MAYER PIPE - AGM Information 2021

Mayer Steel Pipe Corporation Minutes of 2021 Annual Shareholders' Meeting

Time: 9.00 am on July 15, 2021 (Thursday)

Venue: No. 3, Qingnian Rd., Yangmei Dist., Taoyuan City (China-Motor Training Center)

Attendance: Shareholders and proxies in attendance represented 131,781,820 shares, accounting for 59.22% of the 222,526,100 shares issued by the Company in total.

Directors in attendance: Chairman Chun-Fa Huang, Director Ta-Teng Cheng, Independent Director Chih-Ling Chen, Independent Director Huang-Chi Liu, and Independent Director Ching-Chuan Lo

Other attendees: CPA Chin-Feng Lin and Lawyer Shih-Chang Huang

Chairperson: Chun-Fa Huang

Minutes Taker: Jui-Chun Wang

I. Call the Meeting to Order
II. Chairperson's Remarks: Omitted
III. Report Matters:
- (I) Report on the 2020 business. (See Appendices)
- (II) Audit Committee's audit report of 2020 financial statements. (See Appendices)
- (III) Report on the distribution of remuneration for employees and Directors in 2020. (See Appendices)
- (IV) Report on the earnings distribution by way of cash dividends in 2020. (See Appendices)
- (V) Report on the Company's Ethical Corporate Management Best Practice Principles. (See Appendices)
- (VI) Report on the Company's Procedures for Ethical Management and Guidelines for Conduct (See Appendices)
- (VII)Other reported matters. (See Appendices)
IV. Proposals:
Proposal 1: The Company's 2020 Financial Statements, submitted for approval. (Proposed by the Board of Directors)
Explanatory Notes: The Company’s 2020 business report (see Appendix), financial report (including parent company-only financial statements and consolidated financial statements (see Appendix I), which were audited and certified by CPAs Chin-Feng Lin and Ya-Chuan Chang from Crowe (TW) CPAs), were audited at the 18th meeting of the 2nd session of the Audit Committee on March 19, 2021, where an audit report was issued and approved at the 21st meeting of the 21st session of the Board of Directors on March 19, 2021.
Resolution: The number of votes cast by shareholders on the spot after adding the number of votes exercised electronically was as follows: 110,784,493 votes in favor of the proposal (including 109,800,137

votes exercised electronically), 34,678 votes against the proposal (including 34,678 votes exercised electronically), and 3,881,473 invalid votes/votes not exercised (including 3,856,069 votes exercised electronically). The percentage of votes in favor of the proposal was 96.58% (where the total voting rights of shareholders in attendance was 114,700,644). Hence, the proposal was approved.

Proposal 2: Distribution of cash dividends from earnings in 2020, submitted for approval. (Proposed by the Board of Directors)
Explanatory Notes: The distribution of earnings in 2020 was audited at the 19th meeting of the 2nd session of the Audit Committee on April 27, 2021, where an audit report was issued and approved by the 22nd meeting of the 21st session of the Board of Directors on April 27, 2021. For the 2020 Earnings Distribution Table, kindly refer to Appendix II.

Resolution: The number of votes cast by shareholders on the spot after adding the number of votes exercised electronically was as follows: 110,987,452 votes in favor of the proposal (including 110,003,096 votes exercised electronically), 26,679 votes against the proposal (including 26,679 votes exercised electronically), and 3,686,513 invalid votes/votes not exercised (including 3,661,109 votes exercised electronically). The percentage of votes in favor of the proposal was 96.76% (where the total voting rights of shareholders in attendance was 114,700,644). Hence, the proposal was approved.

V. Discussion:
Proposal 1: Amendments to the Articles of Incorporation for resolution. (Proposed by the Board of Directors)
Explanatory Note: According to Documents J.C.Z.F. No.1090150022 and J.C.Z.F. No.10901500221 issued by the Financial Supervisory Commission (Taiwan) on March 31, 2021, it is proposed that the Company amend certain provisions of the "Articles of Incorporation" to meet its future business development needs. For more information, kindly refer to Appendix III.
Resolution: The number of votes cast by shareholders on the spot after adding the number of votes exercised electronically was as follows: 110,980,072 votes in favor of the proposal (including 109,995,716 votes exercised electronically), 34,597 votes against the proposal (including 34,597 votes exercised electronically), and 3,685,975 invalid votes/votes not exercised (including 3,660,571 votes exercised electronically). The percentage of votes in favor of the proposal was 96.75% (where the total voting rights of shareholders in attendance was 114,700,644). Hence, the proposal was approved.
Proposal 2: Amendments to the "Rules Governing the Proceedings of Shareholder Meetings" for resolution. (Proposed by the Board of Directors)
Explanatory Notes: With reference to the "Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings" amended and issued by TWSE on January 28, 2021, it is proposed that the Company

amend certain provisions of the "Procedures for Election of Directors" to meet its future business development needs. For more information, kindly refer to Appendix IV. Resolution: The number of votes cast by shareholders on the spot after adding the number of votes exercised electronically was as follows: 110,979,612 votes in favor of the proposal (including 109,995,256 votes exercised electronically), 35,604 votes against the proposal (including 35,604 votes exercised electronically), and 3,685,428 invalid votes/votes not exercised (including 3,660,024 votes exercised electronically). The percentage of votes in favor of the proposal was 96.75% (where the total voting rights of shareholders in attendance was 114,700,644). Hence, the proposal was approved.

VI. Extempore Motions: None.
VII. Adjournment: At 9.16 am.

Report on the 2020 Business:

Business Report

I. Management Principles:
Promotion of the new concepts of the manufacturing service industry.
Implementation of business strategy of diversified cooperation.
Building an energetic organizational environment with smooth communication and coordination.
Maintenance and continuous improvement of the quality assurance system.
Continuous product upgrade and equipment transformation.
Strengthening the training of middle and senior management talents.
II. Implementation Overview:

As the largest steel pipe manufacturing professional factory in Taiwan, the maintenance and continuous improvement of quality assurance, and the continuous product upgrade and equipment transformation are necessary to ensure the leading position of Mayer's product quality, which are also the active management strategies that Mayer has been implementing.

The Company’s long-term concepts in the manufacturing service industry have won the mutual trust and assistance between its customers, maintained a stable supply and demand relationship between customers and the Company, and ensured the Company’s leading position in the market.

In response to the impact of the tariff barriers in foreign markets on the competitiveness of exported steel pipes and the impact of possible opening up of Mainland China’s welded steel pipes imports on the domestic market in the future, the Company has reviewed and formulated various corresponding strategic plans, which are implemented successively.

III. Implementation Results of the Business Plan:
In 2020, revenue amounted to NT$4,811,114 thousand (comprehensive: NT$5,073,767 thousand), representing an increase of approximately 14.69% as compared to NT$4,194,836 thousand (comprehensive: NT$4,483,371 thousand) in 2019.
In the first half of 2020, domestic steel product users experienced a significant downturn due to panic and low demand arising from the epidemic. The willingness to purchase inventory resumed successively in May and June. Since July, as the demand for steel pipes and steel sheets for infrastructure, factories, and residential construction was gradually released to the market, domestic prices of steel products were able to gradually increase from the decline, while upstream steel factories were able to slowly turn a loss into profit. The Company’s and construction demands for galvanized steel pipes, galvanized electrical wires and stainless steel pipes have already returned to the normal level.

IV. Operating Income: Unit: NT$'000

Operating Income: Unit: NT$'000
Items	2020 (Consolidated)	2020 (Parent company only)
Net operatingincome	5,073,767	4,811,114
Operating costs	4,583,199	4,330,519
Gross operating profit,net	490,405	480,432
Operating Profit	267,460	293,431
Total non-operating income and expenses	178,471	147,051
Other income	86,317	74,819
Othergainandloss,net	59,675	58,294
Finance cost	(48,663)	(32,042)
Share of profit and loss of associates and joint ventures accounted for using the equitymethod,net	81,142	45,980
Netincomefromcontinuing operations,net	445,931	440,482
Netprofit	392,144	392,624

Note: Net operating profit includes realized/(unrealized) (loss)/profit from sales of goods.

V. Fulfillment of Expected Amount:

Unit: NT$1,000

Items	2020 Actual amount (Consolidated)	2020 Actual amount (Parent company only)	2020 Expected amount (Parent company only)	Differences (Parent company only)	Rate of fulfillment (Parent company only)
Net operating income	5,073,767	4,811,114	3,905,875	905,239	123.18
Operating costs	4,583,199	4,330,519	3,559,457	771,062	121.66
Gross operating profit, net	490,405	480,432	346,418	134,014	138.69
Operating Expenses	222,945	187,001	185,995	1,006	100.54
Operating Profit	267,460	293,431	160,423	133,008	182.91
Income before income tax	445,931	440,482	313,815	126,667	140.36

Note: Net operating profit includes realized/(unrealized) (loss)/profit from sales of goods.

VI. Profitability Analysis:

	Descriptions	2020 (Consolidated)	2020 (Parent company only)
Profitability	Returnonassets (%)	6.59	7.17
	Returnonshareholders'equity (%)	12.5	12.52
	Ratio of net profit before tax to paid-in capital(%)	20.04	19.79
	Net profitmargin(%)	7.73	8.16
	Earningsper share(NT$)	1.76	1.76

VII. Research and Development:

Equipment

In 2021, we will inspect the factory machine parts that are often malfunctioning and affecting the normal operation of the production lines in 2020, and prioritize the modification and renewal of thread, alignment, heat treatment, and water pressure testing equipment.

2. Skills

The research and improvement of the welding skills of medium and low carbon alloy steel products, as well as the further improvement of the flexibility quality of welding steel pipes with low-diameter and thick walls, are the key projects that the Company will be continuously implementing in the long term.

Environment protection

In 2020, the investigation and evaluation of soil and groundwater pollution at the Pushin Plant was completed, which were, together with the results, submitted to the Taoyuan City Government for review. With regard to industrial sewage, air, and noise pollutions, we have implemented operations in compliance with environmental protection regulations and continued to make improvements to fulfill our social responsibilities.

Chairman: Chun-Fa Huang

General Manager: Min-Chih Hsiao

Chief accountant: Hui-Wen Li

Audit Committee's Review Report on the 2020 Financial Statements:

Audit Committee's Review Report

The Board of Directors has prepared the Company's 2020 Business Report and Financial Statements. The Board of Directors has also appointed Crowe (TW) CPAs to audit the Financial Statements and an audit report has been issued accordingly.

The above Business Report and Financial Statements have been reviewed by the Audit Committee. We have not found any inconsistencies with applicable laws. Therefore, we hereby issue this report in compliance with Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act.

Submitted for review

The Company's 2021 General Shareholders' Meeting

Mayer Steel Pipe Corporation Convener of the Audit Committee: Chih-Ling Chen

March 19, 2021

Audit Committee's Review Report

The Board of Directors has prepared the Company's 2020 earnings distribution proposal, which has been reviewed by the Audit Committee. We have not found any inconsistencies with applicable laws. Therefore, we hereby issue this report in compliance with Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act.

Submitted for review

The Company's 2021 General Shareholders' Meeting

Mayer Steel Pipe Corporation Convener of the Audit Committee: Chih-Ling Chen

April 27, 2021

Report on the Distribution of Remuneration for Employees and Directors in 2020:

(I) Handled in accordance with the Company Law and Article 40 of the Company’s Articles of Association. The Company’s 2020 profit has been audited by the CPA. Based on the audited amount, it is proposed to distribute 5% of the profit by cash as employee remuneration (equivalent to NT$23,939,239) and 3% of the profit by cash as Directors’ remuneration by cash (equivalent to NT$14,363,544).
(II) The distribution of employees’ and Directors’ remuneration was approved at the 21st meeting of the 21st session of the Board meeting on March 19, 2021.

Report on the earnings distribution by way of cash dividends in 2020:

(I) Handled according to Article 240 of the Company Act and Article 40 of the Company's Articles of Association. Where shareholders' bonus is distributed in cash, the Board of Directors is authorized to determine such distribution by a resolution approved by a majority vote at a meeting attended by over two-thirds of the Directors and report to the Shareholders' Meeting.
(II) The Company’s 2020 audited profit after tax amounted to NT$392,624,239, with distributable earnings of NT$394,780,400. The Company intended to distribute a shareholder dividend of NT$1.70 per share, with a total amount of NT$378,294,370. The cash dividend is rounded off to the nearest NT Dollar, with the decimal places removed. The total rounded-off cash dividend below NT$1 is accounted as other income of the Company.
(III) The proposal was approved by the 22nd meeting of the 21st session of the Board of Directors on April 27, 2021. The cash dividend distribution date was set on June 19, 2021 (ex-dividend date), while the cash dividend distribution date was set on July 7, 2021. In the event that the transfer, conversion, and cancellation of the Company’s shares due to repurchase or other factors that affect the number of outstanding shares and hence the dividend payout ratio of the shareholders, the Chairman is also authorized to handle such matters and make adjustments in his/her absolute discretion.

Report of the Company's Ethical Corporate Management Best Practice Principles:

To foster a corporate culture of ethical management and establish an internal control mechanism, so as to improve the sustainable operation and development of the Company and to maintain a sound business operation, the Company has formulated this code with reference to the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” issued by Taiwan Stock Exchange Corporation. (Please refer to Appendix VII, page #pageXX# of this Handbook).

Report of the Company's Procedures for Ethical Management and Guidelines for Conduct:

The Company engages in commercial activities following the principles of fairness, honesty, faithfulness, and transparency, and in order to fully implement a policy of ethical management and actively prevent unethical conduct, these Procedures and Guidelines are adopted pursuant to the provisions of the Ethical Corporate Management Best Practice Principles for the Company and the applicable laws and regulations of the places where the Company and its group enterprises and organizations operate, with a view to providing all personnel of the Company with clear directions for the performance of their duties. (Please refer to Appendix VIII, page #pageXX# of this Handbook).

Other report matters:

Report on the endorsements/guarantees and loans to others of the Company and its (sub)subsidiaries:

(I) Ending balance (limit) of the Company’s endorsements/guarantees in 2020: 1. Balance of the endorsements/guarantees to Ting Pang Development Co., Ltd. was NT$250,000 thousand.
(II) Ending balance of the endorsements/guarantees of the (sub)subsidiaries in 2020: None.
(III) Ending balance (limit) of the Company’s loans to others in 2020:
Balance of loans to the subsidiary, Mayer Corporation Development International Limited, was NT$17,353 thousand.
Balance of loans to the subsidiary, Mayer Inn Corporation: 0.
The balance of the loan to Ting Pang Development Co., Ltd. was NT$58,000 thousand.
(IV) Ending balance of loans to others of the (sub)subsidiaries in 2020: None.

Appendix I INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders

Mayer Steel Pipe Corporation

Opinion

We have audited the accompanying parent company only financial statements of Mayer Steel Pipe Corporation (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 related 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 of 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 judgment, 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 from the Company’s parent company only financial statements for the year ended December 31, 2020 are stated as follows:

Valuation of inventory

As of December 31, 2020, the inventory - manufacturing net amount of the Company is NT$1,000,184 thousand (after deducting allowance for inventory valuation, obsolescence losses, and idled losses of NT$4,715 thousand). Please refer to Notes 5 and 6 (8) for the financial statements. The inventory valuation of tthe Company are affected by international steel price and market fluctuations, possibly resulting in slow-moving inventory and subsequent obsolescence losses. The Company’s accounting policies for reporting allowance for inventory valuation and obsolescence losses are based on information on the age of inventory, which comes from management’s evaluation of the expected net realizable value of each product based on inventory sales and purchase price to determine the value of normal quality inventory by the lower cost and net realizable value and report allowances for valuation loss. Because such evaluation involves major judgments from management and the inventory’s book value is such a major part of financial statements, we have listed inventory valuation as a key audit matters. Our primary auditing procedure for the aforementioned item is as follows:

Understand and evaluate the design and effectiveness of the Company’s internal inventory control system, including the accuracy of reported age of inventory.
Evaluate the age of inventory at the end of the year and take samples to verify the accuracy of reported age of inventory.
Verify that basic assumptions made in the calculation of net realizable values are sound.

Conduct inventory sampling at the end of the year to confirm and evaluate whether the inventory is out of date or damaged.

Valuation of financial assets

As of December 31, 2020, the Company’s non-current financial assets at fair value through profit or loss, non-current financial assets at fair value through other comprehensive income, and net investment accounted under the equity method totals NT$1,945,591 thousand. Please refer to Notes 5 and 6 (2), (3), and (11). The Company assess their fair value and report their financial asset (losses) income at fair value, unrealized gains (losses) from investments in equity instruments at fair value through other comprehensive income, and shares of income of affiliated companies and joint ventures accounted under the equity method. These assessments are made by management based on assessment reports by professional appraisal companies and the net equity value and current gains/losses of affiliated companies. The management evaluates increases and decreases in book value to recognize the shares of investees’ income, then evaluate whether there are any objective evidence of impairment to determine any impairment amount. Because book value is significant to the parent company only financial statements, we have listed non-current financial asset at fair value through other comprehensive income, noncurrent financial assets at fair value through other comprehensive income, and net investment amount recognized under the equity method as key audit matters. Our primary auditing procedure for the aforementioned item is as follows:

Obtain professional appraisal report of the Company’s non-current financial assets at fair value through other comprehensive income, non-current financial assets at fair value through other comprehensive income, as well as the most recent comparable financial statements provided by affiliate companies to verify the soundness of how the fair value is determined.
Verify the accuracy of reported financial assets at fair value through profit or loss, unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income, and shares of profits and losses of affiliated companies and joint ventures recognized under the equity method.

Make adjustments to the financial statements of affiliated companies based on auditing results so that the financial statements comply with the requirements and presentations of the IFRS, IAS, IFRIC, and SIC approved by Financial Supervisory Commission.

Other Matters

We did not audit the financial statements of certain companies in which the Company has investments accounted for using the equity method. Those financial statements were audited by other independent accountants, whose reports thereon have been furnished to us, and our opinion expressed herein, insofar as it relates to the amounts included in the parent company only financial statements was based solely on the reports of other independent accountants. Investments in these associates amounted to NT$189,240 thousand and NT$178,664 thousand, both representing 3% of the total assets as of December 31, 2020 and 2019, and the share of profit of these associates accounted for using equity method amounted to NT$53,900 thousand and NT$58,150 thousand, both representing 12% of total income before income tax for the years then ended, respectively. In addition, the share of other comprehensive income of these associates accounted for using equity method amounted to NT$ (8,830) thousand and NT$ (3,801) thousand, representing (31%) and (14%) of total comprehensive income for the years then ended, respectively.

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 from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the parent company only financial statements.

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

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

Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company 's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors' report to the related disclosures in the parent company only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors' report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure, and content of the parent company only financial statements, including the disclosures, and whether the the parent company only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the 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 Company audit. We remain solely responsible for our auditor 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 ethica1 requirements regarding independence, and to communicate with them all re1ationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent company only financial statements for the year ended December 31, 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 ChinFeng Lin and Ya-Chuan Chang.

Crowe (TW) CPAs Taipei, Taiwan (Republic of China) March 19, 2021

Notice to Readers

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

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

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY BALANCE SHEETS December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

Assets Current assets`：` Cash and cash equivalents(Note 6) Current financial assets at fair value through profit or loss(Note 6) Current financial assets at fair value through other comprehensive income(Note 6) Notes receivable, net(Note 6) Notes receivable due from related parties, net(Note 6 and 7) Accounts receivable, net(Note 6) Accounts receivable due from related parties, net(Note 6 and 7) Finance lease receivable, net(Note 6 and 8) Other receivables(Note 6) Other receivables due from related parties(Note 6) Inventories, manufacturing business(Note 6) Inventories (for construction business)(Note 6,7 and 8) Prepayments(Note 6) Other current assets(Note 6 and 8) Total current assets Non-current assets`：` Non-current financial assets at fair value through profit or loss(Note 6) Non-current financial assets at fair value through other comprehensive income(Note 6) Non-current financial assets at amortised cost(Note 6) Investments accounted for using equity method(Note 6 and 7) Property, plant and equipment(Note 6,7 and 8) Right-of-use assets(Note 6) Investment property, net(Note 6 and 8) Intangible assets Deferred tax assets(Note 6) Other non-current assets(Note 6, 7, 8 and 9) Total non-current assets Total assets Liabilities and equity Current liabilities`：` Current borrowings(Note 6 and 8 ) Short-term notes and bills payable(Note 6) Current contract liabilities(Note 6 and 7) Notes payable Accounts payable Accounts payable to related parties(Note 7) Other payables Other payables to related parties(Note 7) Current tax liabilities Current lease liabilities(Note 6) Long-term borrowings, current portion(Note 6 and 8) Other current liabilities, others Total current liabilities Non-current liabilities`：` Non-current portion of non-current borrowings(Note 6 and 8) Non-current provisions(Note 6 and 9) Current tax liabilities, non-current(Note 6) Deferred tax liabilities(Note 6) Non-current lease liabilities(Note 6) Net defined benefit liability, non-current(Note 6) Other non-current liabilities, others(Note 6) Total non-current liabilities Total liabilities Equity`：` Total Share capital(Note 6) Total capital surplus(Note 6) Retained earnings(Note 6) Legal reserve Special reserve Unappropriated retained earnings Total retained earnings Total other equity interest(Note 6) Total equity Total liabilities and equity	December 31, 20	20	% 3 - - 2 - 7 - - 1 - 16 3 2 14 48 6 2 - 24 13 1 3 - - 3 52 100 32 1 - 4 1 - 2 - 1 - - - 41 1 1 - 3 - - 2 7 48 37 5 3 3 7 13 3 ) 52 100	% `＄` 161,223 3 61,825 1 14,532 - 63,036 1 86 - 327,485 6 2,352 - 923 - 7,802 - 30,000 1 746,502 13 100,228 2 102,832 2 737,596 13 2,356,422 42 369,379 7 121,938 2 10,000 - 1,501,670 27 836,762 15 40,316 1 153,502 3 - - 2,011 - 186,571 3 3,222,149 58 `＄` 5,578,571 100 `＄` 1,503,154 27 29,972 1 4,576 - 304,189 5 31,910 1 - - 124,540 2 126 - 43,510 1 13,381 - - - 6,519 - 2,061,877 37 77,813 2 316 - - - 184,203 3 27,096 - 23,014 - 71,634 2 384,076 7 2,445,953 44 2,225,261 40 281,622 5 156,048 3 242,551 4 435,360 8 833,959 15 ( 208,224 ) ( 4 ) 3,132,618 56 `＄` 5,578,571 100 Amount December 31, 2019
	`＄` 172,557 28,516 53,410 92,752 - 424,032 8,384 840 68,476 - 1,000,184 153,398 104,878 841,938 2,949,365 374,725 113,560 - 1,457,306 798,430 32,136 150,569 177 20,000 192,397 3,139,300 `＄` 6,088,665 `＄` 1,959,907 29,992 2,461 228,904 64,745 120 120,300 - 76,446 10,489 2,711 6,613 2,502,688 72,435 41,746 21,814 176,385 21,788 22,903 90,554 447,625 2,950,313 2,225,261 281,622 197,832 208,224 404,805 810,861 ( 179,392 ) 3,138,352 `＄` 6,088,665 Amount










		(

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

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME For the Years Ended December 31, 2020 and 2019

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

Operating revenue(Note 6 and 7) Operating costs(Note 6 and 7) Gross profit from operations Unrealized profit (loss) from sales Realized profit (loss) on from sales Gross profit from operations Operating expenses(Note 6 and 7) Selling expenses Administrative expenses Impairment gain and reversal of impairment loss Total operating expenses Net operating income Non-operating income and expenses Interest income(Note 6 and 7) Other income(Note 6 and 7) Other gains and losses, net(Note 6) Finance costs, net(Note 6) Impairment gain and reversal of impairment loss Share of profits of subsidiaries and associates(Note 6) Total non-operating income and expenses Profit (loss) from continuing operations before tax Income tax expense (Note 6) Net Income Other comprehensive income (loss) Remeasurement of defined benefit obligation(Note 6) Unrealised gains (losses) from investments in equity instruments measured at fair value through other comprehensive income(Note 6) Components of other comprehensive income that will not be reclassified to profit or loss Share of other comprehensive gain of subsidiaries and associates `－`Items that may be reclassified subsequently to profit or loss:`(`Note6`)` Other comprehensive loss for the year, net of income tax(Note 6) Components of other comprehensive income that will be reclassified to profit or loss Other comprehensive income, net Total comprehensive income Basic earnings per share(Note 6)	2020	％％ 100 `＄` 4,194,836 100 ( 90 ) ( 3,754,299 ) ( 89 ) 10 440,537 11 - ( 980 ) - - 1,543 - 10 441,100 11 ( 2 ) ( 77,681 ) ( 2 ) ( 3 ) ( 123,581 ) ( 3 ) 1 6,503 - ( 4 ) ( 194,759 ) ( 5 ) 6 246,341 6 1 5,246 - 1 58,475 2 1 105,696 3 ( 1 ) ( 30,701 ) ( 1 ) - ( 16 ) - 1 103,093 2 3 241,793 6 9 488,134 12 ( 1 ) ( 51,428 ) ( 2 ) 8 436,706 10 - ( 6,616 ) - 1 32,185 1 1 25,569 1 ( 1 ) 3,262 - 1 ( 1,120 ) - - 2,142 - 1 27,711 1 9 `＄` 464,417 11 `＄` 1.96 2019 Amount
	`＄` 4,811,114 ( 4,330,519 ) 480,595 ( 1,143 ) 980 480,432 ( 75,677 ) ( 130,987 ) 19,663 ( 187,001 ) 293,431 13,850 60,969 58,294 ( 32,042 ) - 45,980 147,051 440,482 ( 47,858 ) 392,624 ( 173 ) 45,833 45,660 ( 24,282 ) 7,281 ( 17,001 ) 28,659 `＄` 421,283 `＄` 1.76 Amount

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

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY

For the Years Ended December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

		Retai	ned Earnings		Others
	`＄` 125,989 - 125,989 30,059 - - - - - - - - - 156,048 41,784 - - - - - - - `＄` 197,832 Legal Reserve	`＄` 102,504 - 102,504 - 140,047 - - - - - - - - 242,551 - - - ( 34,327 ) - - - - `＄` 208,224 Special Reserve	`＄` 499,164 ( 664 ) 498,500 ( 30,059 ) ( 140,047 ) ( 311,537 ) 436,706 ( 6,616 ) 430,090 - ( 7,650 ) ( 3,445 ) ( 492 ) 435,360 ( 41,784 ) - ( 411,674 ) 34,327 392,624 ( 173 ) 392,451 ( 3,875 ) `＄` 404,805 Unappropriated Earnings	`＄`( 58 ) - ( 58 ) - - - - 4,477 4,477 - - - - 4,419 - - - - - ( 29,125 ) ( 29,125 ) - `＄`( 24,706 ) Foreign Currency Translation Reserve	`＄`( 242,493 ) - ( 242,493 ) - - - - 29,850 29,850 - - - - ( 212,643 ) - - - - - 57,957 57,957 - `＄`( 154,686 ) Unrealized Gain(Loss) on Financial Assets at Fair Value Through Other Comprehensive Income
`＄`



(



`＄`

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

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities
Profit (loss) before tax
Adjustments：
Adjustments to reconcile profit (loss)
Depreciation expense
Amortization expense
Expected credit loss (gain)
Net loss (gain) on financial assets or liabilities at fair value through profit or loss
Interest expense
Interest income
Dividend income
Share of loss (profit) of associates and joint ventures accounted for using equity method
Loss (gain) on disposal of property, plan and equipment
Loss (gain) on disposal of investments
Other adjustments to reconcile profit (loss)
Total adjustments to reconcile profit (loss)
Changes in operating assets and liabilities
Decrease (increase) in financial assets at fair value through profit or loss, mandatorily measured at fair value
Decrease (increase) in notes receivable
Decrease (increase) in notes receivable due from related parties
Decrease (increase) in accounts receivable
Decrease (increase) in accounts receivable due from related parties
Decrease (increase) in other receivable
Decrease (increase) in other receivable due from related parties
Decrease (increase) in inventories
Decrease (increase) in prepayments
Decrease (increase) in other current assets
Total changes in operating assets
Increase (decrease) in contract liabilities
Increase (decrease) in notes payable
Increase (decrease) in accounts payable
Increase (decrease) in accounts payable to related parties
Increase (decrease) in other payable
Increase (decrease) in other payable to related parties
Increase (decrease) in provisions
Increase (decrease) in other current liabilities
Increase (decrease) in net defined benefit liability
Total changes in operating liabilities
Total changes in operating assets and liabilities
Total adjustments
Cash inflow (outflow) generated from operations
Interest received
Dividends received
Interest paid
Income taxes refund (paid)
Net cash flows from (used in) operating activities ＄
440,482
＄
488,134
67,077
70,794
5,949
4,068
(
19,663 )
(
6,487 )
(
82,801 )
(
106,460 )
32,042
30,394
(
13,850 )
(
5,246 )
(
48,763 )
(
42,415 )
(
45,980 )
(
103,093 )
3,674
1,637
(
23,780 )
(
1,633 )
-
(
309 )
(
126,095 )
(
158,750 )
56,734
8,622
(
29,716 )
46,872
86
(
86 )
(
97,884 )
21,584
(
6,032 )
9,392
(
33,756 )
(
382 )
30,000
(
30,000 )
(
306,852 )
181,902
(
2,046 )
4,447
(
21,815 )
23,205
(
411,281 )
265,556
(
2,115 )
(
15,862 )
(
75,285 )
(
108,505 )
32,835
(
17,715 )
120
-
(
4,661 )
15,176
(
126 )
126
41,430
316
94
15
(
284 )
106
(
7,992 )
(
126,343 )
(
419,273 )
139,213
(
545,368 )
(
19,537 )
(
104,886 )
468,597
7,932
6,040
222,003
231,286
(
30,838 )
(
31,078 )
(
11,636 )
(
34,198 )
82,575
640,647
2020
2019

(Cotinued)

Cash flows from (used in) investing activities：
Acquisition of financial assets at fair value through other comprehensive income
Proceeds from disposal of financial assets at fair value through other comprehensive income
Proceeds from capital reduction of financial assets at fair value through other comprehensive income
Proceeds from repayments of financial assets at amortised cost
Acquisition of investments accounted for using equity method
Proceeds from capital reduction of investments accounted for using equity method
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Decrease in refundable deposits
Acquisition of intangible assets
Decrease in long-term lease and installment receivables
Increase in other non-current assets
Decrease in prepayments for business facilities
Increase in other prepayments
Other investing activities
Net cash flows from (used in) investing activities
Cash flows from (used in) financing activities：
Increase in short-term loans
Decrease in short-term loans
Increase in short-term notes and bills payable
Decrease in short-term notes and bills payable
Proceeds from long-term debt
Repayments of long-term debt
Increase in guarantee deposits received
Payments of lease liabilities
Cash dividends paid
Payments to acquire treasury shares
Net cash flows from (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period (
16,789 )
(
930 )
2,707
2,885
20,814
41,628
10,000
-
(
110,000 )
(
196,170 )
-
40,000
(
18,750 )
(
46,256 )
3,677
124
3,486
58,135
(
185 )
-
685
(
41,021 )
(
4,848 )
-
(
11,007 )
13,383
-
(
9,545 )
171
(
563 )
(
120,039 )
(
138,330 )
456,753
-
-
(
187,692 )
20
-
-
(
2 )
-
68,813
(
2,667 )
-
21,580
-
(
15,214 )
(
14,053 )
(
411,674 )
(
311,537 )
-
(
29,739 )
48,798
(
474,210 )
-
-
11,334
28,107
161,223
133,116
＄
172,557
＄
161,223
2020
2019

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

INDEPENDENT AUDITORS’ REPORT

The Board of Directors and Shareholders

Mayer Steel Pipe Corporation

Opinion

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

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as of December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and 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 of 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 Group 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 judgment, 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 from the Group’s consolidated financial statements for the year ended December 31, 2020 are stated as follows:

Valuation of inventory

As of December 31, 2020, the inventory - manufacturing net amount of Mayer Steel Pipe Corporation and subsidiaries is NT$1,039,463 thousand (after deducting allowance for inventory valuation, obsolescence losses, and idled losses of NT$5,433 thousand). Please refer to Notes 5 and 6 (8) for the consolidated financial statements. The inventory valuation of the Group are affected by international steel price and market fluctuations, possibly resulting in slow-moving inventory and subsequent obsolescence losses. The Company’s accounting policies for reporting allowance for inventory valuation and obsolescence losses are based on information on the age of inventory, which comes from management’s evaluation of the expected net realizable value of each product based on inventory sales and purchase price to determine the value of normal quality inventory by the lower cost and net realizable value and report allowances for valuation loss. Because such evaluation involves major judgments from management and the inventory’s book value is such a major part of consolidated financial statements, we have listed inventory valuation as a key audit matters. Our primary auditing procedure for the aforementioned item is as follows:

Understand and evaluate the design and effectiveness of the Company ’ s internal inventory control system, including the accuracy of reported age of inventory.
Evaluate the age of inventory at the end of the year and take samples to verify the accuracy of reported age of inventory.
Verify that basic assumptions made in the calculation of net realizable values are sound.
Conduct inventory sampling at the end of the year to confirm and evaluate whether the inventory is out of date or damaged.

Valuation of financial assets

As of December 31, 2020, the Group’s non-current financial assets at fair value through profit or loss, non-current financial assets at fair value through other comprehensive income, and net investment accounted under the equity method totals NT$991,327 thousand. Please refer to Notes 5 and 6 (2), (3), and (11). The Group’s assess their fair value and report their financial asset (losses) income at fair value, unrealized gains (losses) from investments in equity instruments at fair value through other comprehensive income, and shares of income of affiliated companies and joint ventures accounted under the equity method. These assessments are made by management based on assessment reports by professional appraisal companies and the net equity value and current gains/losses of affiliated companies. The management evaluates increases and decreases in book value to recognize the shares of investees’ income, then evaluate whether there are any objective evidence of impairment to determine any impairment amount. Because book value is significant to the consolidated financial statements, we have listed non-current financial asset at fair value through other comprehensive income, non-current financial assets at fair value through other comprehensive income, and net investment amount recognized under the equity method as key audit matters. Our primary auditing procedure for the aforementioned item is as follows:

Obtain professional appraisal report of the Group ’ s non-current financial assets at fair value through other comprehensive income, non-current financial assets at fair value through other comprehensive income, as well as the most recent comparable financial statements provided by affiliate companies to verify the soundness of how the fair value is determined.
Verify the accuracy of reported financial assets at fair value through profit or loss, unrealized gains (losses) from investments in equity instruments measured at fair value through other comprehensive income, and shares of profits and losses of affiliated companies and joint ventures recognized under the equity method.

3. Make adjustments to the financial statements of affiliated companies based on auditing results so that the financial statements comply with the requirements and presentations of the IFRS, IAS, IFRIC, and SIC approved by Financial Supervisory Commission.

Other Matters

We did not audit the financial statements of certain companies in which the Group has investments accounted for using the equity method. Those financial statements were audited by other independent accountants, whose reports thereon have been furnished to us, and our opinion expressed herein, insofar as it relates to the amounts included in the consolidated financial statements was based solely on the reports of other independent accountants. Investments in these associates amounted to NT$189,240 thousand and NT$178,664 thousand, both representing 3% of the consolidated total assets as of December 31, 2020 and 2019, and the share of profit of these associates accounted for using equity method amounted to NT$53,900 thousand and NT$58,150 thousand, both representing 12% of total consolidated income before income tax for the years then ended, respectively. In addition, the share of other comprehensive income of these associates accounted for using equity method amounted to NT$ (8,830) thousand and NT$ (3,801) thousand, representing (31%) and (14%) of total consolidated comprehensive income for the years then ended, respectively.

We have also audited the parent company only financial statements of Mayer Steel Pipe Corporation as of and for the years ended December 31, 2020 and 2019 on which we have issued an unmodified opinion.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with 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 Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Those charged with governance (including members of the Audit Committee) are responsible for overseeing the Group's financial reporting process.

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

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an 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.

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

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements 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 ChinFeng Lin and Ya-Chuan Chang.

Crowe (TW) CPAs Taipei, Taiwan (Republic of China)

March 19, 2021

Notice to Readers

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

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

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED BALANCE SHEETS

December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

Assets Current assets`：` Cash and cash equivalents(Note 6) Current financial assets at fair value through profit or loss(Note 6) Current financial assets at fair value through other comprehensive income(Note 6) Current financial assets at amortised cost(Note 6) Notes receivable, net(Note 6) Accounts receivable, net(Note 6) Accounts receivable due from related parties, net(Note 6 and 7) Finance lease receivable, net(Note 6 and 8) Other receivables(Note 6) Inventories, manufacturing business(Note 6) Inventories (for construction business)(Note 6`、`7 and 8) Prepayments(Note 6) Other current assets(Note 6 and 8) Total current assets Non-current assets`：` Non-current financial assets at fair value through profit or loss(Note 6) Non-current financial assets at fair value through other comprehensive income(Note 6) Non-current financial assets at amortised cost(Note 6) Investments accounted for using equity method(Note 6 and 7) Property, plant and equipment(Note 6`、`7 and 8) Right-of-use assets(Note 6) Investment property, net(Note 6 and 8) Intangible assets(Note 7) Deferred tax assets(Note 6) Other non-current assets(Note 6`、`7`、`8 and 9) Total non-current assets Total assets Liabilities and equity Current liabilities`：` Current borrowings(Note 6 and 8) Short-term notes and bills payable(Note 6 and 8) Current contract liabilities(Note 6 and 7) Notes payable Notes payable to related parties(Note 7) Accounts payable Accounts payable to related parties(Note 7) Other payables Other payables to related parties(Note 7) Current tax liabilities Current lease liabilities(Note 6) Long-term liabilities, current portion(Note 6 and 8) Other current liabilities, others(Note 6) Total current liabilities Non-current liabilities`：` Non-current portion of non-current borrowings(Note 6 and 8) Non-current provisions(Note 6 and 9) Current tax liabilities, non-current(Note 6) Deferred tax liabilities(Note 6) Non-current lease liabilities(Note 6) Net defined benefit liability, non-current(Note 6) Other non-current liabilities, others(Note 6) Total non-current liabilities Total liabilities Equity attributable to owners of parent Total Share Capital(Note 6) Total capital surplus(Note 6) Retained earnings(Note 6) Legal reserve Special reserve Unappropriated retained earnings Total retained earnings Total other equity interest(Note 6) Total equity attributable to owners of parent Non-controlling interests(Note 6) Total equity Total liabilities and equity	December 31,2020		% 4 1 1 1 1 7 - - 1 15 9 2 13 55 6 3 - 6 15 10 2 - - 3 45 100 29 1 - 3 - 1 - 2 - 1 1 - - 38 1 1 - 3 9 - 2 16 54 33 4 3 3 6 12 3 ) 46 - 46 100	% `＄` 361,821 6 110,159 2 14,532 - - - 63,036 1 355,807 6 2,352 - 923 - 17,246 - 790,096 12 550,914 9 114,062 2 737,596 12 3,118,544 50 369,379 6 218,695 4 10,000 - 425,778 7 1,074,738 17 716,375 11 153,502 2 2,210 - 2,011 - 211,622 3 3,184,310 50 `＄` 6,302,854 100 `＄` 1,503,154 24 29,972 - 4,875 - 311,718 5 572 - 56,601 1 - - 142,787 2 2,221 - 45,397 1 50,281 1 - - 6,701 - 2,154,279 34 77,813 1 316 - - - 184,203 3 658,086 11 23,014 - 74,037 1 1,017,469 16 3,171,748 50 2,225,261 35 281,622 4 156,048 3 242,551 4 435,360 7 833,959 14 ( 208,224 ) ( 3 ) 3,132,618 50 ( 1,512 ) - 3,131,106 50 `＄` 6,302,854 100 Amount December 31,2019
	`＄` 244,858 42,620 59,335 61,248 92,752 478,822 8,384 840 100,385 1,039,463 628,142 116,143 841,938 3,714,930 374,725 204,297 - 412,305 1,024,556 658,560 150,569 3,141 20,000 214,296 3,062,449 `＄` 6,777,379 `＄` 1,959,907 29,992 2,743 229,038 - 94,997 120 129,029 16 78,774 48,745 2,711 6,752 2,582,824 72,435 41,746 21,814 176,385 614,523 22,903 100,394 1,050,200 3,633,024 2,225,261 281,622 197,832 208,224 404,805 810,861 ( 179,392 ) 3,138,352 6,003 3,144,355 `＄` 6,777,379 Amount











		(

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

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Years Ended December 31, 2020 and 2019

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

Operating revenue(Note 6、7 and 14)
Operating costs(Note 6 and 7)
Gross profit from operations
Unrealized profit (loss) from sales
Realized profit (loss) on from sales
Gross profit from operations
Operating expenses(Note 6 and 7)
Selling expenses
Administrative expenses
Impairment gain and reversal of impairment loss
Total operating expenses
Net operating income
Non-operating income and expenses
Interest income(Note 6)
Other income(Note 6 and 7)
Other gains and losses, net(Note 6)
Finance costs, net(Note 6)
Impairment gain and reversal of impairment loss
Share of profits of subsidiaries and associates(Note 6 and 14)
Total non-operating income and expenses
Profit (loss) from continuing operations before tax
Income tax expense (Note 6 and 14)
Net Income
Other comprehensive income
Remeasurement of defined benefit obligation(Note 6)
Unrealised gains (losses) from investments in equity instruments measured
at fair value through other comprehensive income(Note 6)
Components of other comprehensive income that will not be reclassified to profit or loss
Exchange differences on translation(Note 6)
Share of other comprehensive income of associates and joint ventures accounted for using equity method,
components of other comprehensive income that will be reclassified to profit or loss(Note 6)
Other comprehensive loss for the year, net of income tax(Note 6)
Components of other comprehensive income that will be reclassified to profit or loss
Other comprehensive income, net
Total comprehensive income
Net Income attributable to:
Shareholders of the parent
Non-controlling interests
Total comprehensive income attributable to:
Shareholders of the parent
Non-controlling interests
Basic earnings per share(Note 6) 2020

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

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the Years Ended December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

	Common Stock	Capital Reserve		Retained	Earnings			Others		Treasury Stock	Total
			Legal Reserve	Special Reserve	Unappropriated Earnings	Totel	Foreign Currency Translation Reserve	Unrealized Gain(Loss) on Financial Assets at Fair Value Through Other Comprehensive Income	Total
`＄`	2,245,261 -	`＄` 283,711 -	`＄` 125,989 -	`＄` 102,504 -
	2,245,261	283,711	125,989	102,504	498,500	726,993					3,013,414
	- - - - -	- - - - -	30,059 - - - -	- 140,047 - - -				- - - - 29,850	- - - - 34,327	- - - - -
	-	-	-	-	430,090	430,090	4,477	29,850	34,327	-	464,417
				- - - -				- - - -	- - - -
	2,225,261 - - - - -	281,622 - - - - -	156,048 41,784 - - - -
	-	-	-	-	392,451	392,451
	- -	- -	- -	- -
`＄`	2,225,261	`＄` 281,622	`＄` 197,832	`＄` 208,224	`＄` 404,805	`＄` 810,861

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

Mayer Steel Pipe Corporation and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2020 and 2019

(In Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities
Profit (loss) before tax
Adjustments：
Adjustments to reconcile profit (loss)
Depreciation expense
Amortization expense
Expected credit loss (gain)
Net loss (gain) on financial assets or liabilities at fair value through profit or loss
Interest expense
Interest income
Dividend income
Share of loss (profit) of associates and joint ventures accounted for using equity method
Loss (gain) on disposal of property, plan and equipment
Loss (gain) on disposal of investments
Other adjustments to reconcile profit (loss)
Total adjustments to reconcile profit (loss)
Changes in operating assets and liabilities
Decrease (increase) in financial assets at fair value through profit or loss, mandatorily measured at fair value
Decrease (increase) in notes receivable
Decrease (increase) in accounts receivable
Decrease (increase) in accounts receivable due from related parties
Decrease (increase) in other receivable
Decrease (increase) in inventories
Decrease (increase) in prepayments
Decrease (increase) in other current assets
Total changes in operating assets
Increase (decrease) in contract liabilities
Increase (decrease) in notes payable
Increase (decrease) in notes payable to related parties
Increase (decrease) in accounts payable
Increase (decrease) in accounts payable to related parties
Increase (decrease) in other payable
Increase (decrease) in other payable to related parties
Increase (decrease) in provisions
Increase (decrease) in other current liabilities
Increase (decrease) in net defined benefit liability
Total changes in operating liabilities
Total changes in operating assets and liabilities
Total adjustments
Cash inflow (outflow) generated from operations
Interest received
Dividends received
Interest paid
Income taxes refund (paid)
Net cash flows from (used in) operating activities ＄
445,931
＄
495,170
138,334
97,406
7,578
5,382
(
19,663 )
(
6,487 )
(
84,877 )
(
108,565 )
48,663
36,212
(
19,149 )
(
14,931 )
(
48,763 )
(
42,415 )
(
81,142 )
(
94,487 )
3,690
1,652
(
24,809 )
(
3,406 )
-
(
309 )
(
80,138 )
(
129,948 )
92,738
34,996
(
29,716 )
46,872
(
124,352 )
23,388
(
6,032 )
11,396
(
58,726 )
(
5,965 )
(
326,595 )
202,068
(
2,081 )
(
6,142 )
(
21,815 )
23,206
(
476,579 )
329,819
(
2,132 )
(
20,841 )
(
82,680 )
(
100,976 )
(
572 )
572
38,396
(
46,867 )
120
-
(
14,179 )
19,432
(
2,205 )
81
41,430
316
51
119
(
284 )
106
(
22,055 )
(
148,058 )
(
498,634 )
181,761
(
578,772 )
51,813
(
132,841 )
546,983
15,736
18,550
116,997
127,468
(
30,838 )
(
31,078 )
(
16,960 )
(
44,646 )
(
47,906 )
617,277
2020
2019

(Continued)

Cash flows from (used in) investing activities：
Acquisition of financial assets at fair value through other comprehensive income
Proceeds from disposal of financial assets at fair value through other comprehensive income
Proceeds from capital reduction of financial assets at fair value through other comprehensive income
Acquisition of financial assets at amortised cost
Proceeds from repayments of financial assets at amortised cost
Acquisition of property, plant and equipment
Proceeds from disposal of property, plant and equipment
Decrease in refundable deposits
Acquisition of intangible assets
Increase in long-term lease and installment receivables
Decrease in long-term lease and installment receivables
Increase in other non-current assets
Increase in prepayments for business facilities
Decrease in prepayments for business facilities
Increase in other prepayments
Other investing activities
Net cash flows from (used in) investing activities
Cash flows from (used in) financing activities：
Increase in short-term loans
Decrease in short-term loans
Increase in short-term notes and bills payable
Decrease in short-term notes and bills payable
Proceeds from long-term debt
Repayments of long-term debt
Increase in guarantee deposits received
Payments of lease liabilities
Cash dividends paid
Payments to acquire treasury shares
Change in non-controlling interests
Net cash flows from (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period (
20,189 )
(
8,590 )
2,707
5,814
36,433
72,866
(
61,248 )
-
10,000
-
(
31,694 )
(
226,726 )
3,677
124
3,493
45,979
(
1,527 )
-
-
(
41,021 )
685
-
(
4,895 )
-
(
9,612 )
-
-
11,988
-
(
9,986 )
8,569
(
563 )
(
63,601 )
(
150,115 )
456,753
-
-
(
187,692 )
20
-
-
(
2 )
-
68,813
(
2,667 )
-
21,580
-
(
68,735 )
(
33,813 )
(
411,674 )
(
311,537 )
-
(
29,739 )
8,328
41
3,605
(
493,929 )
(
9,061 )
(
2,917 )
(
116,963 )
(
29,684 )
361,821
391,505
＄
244,858
＄
361,821
2020
2019

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

Statement of Declaration

We hereby certify that

In 2020 (from January 1 to December 31, 2020), the Company's entities that are required to be included in the consolidated financial statements of affiliated enterprises under the "Criteria Governing Preparation of Consolidated Business Report of Affiliated Enterprises, Consolidated Financial Statements of Affiliated Enterprises, and Affiliation Reports" are the same as those required to be included in the parent-subsidiary consolidated financial statements under the International Financial Reporting Standards 10. Moreover, the related information required to be disclosed for the consolidated financial statements of affiliated enterprises has been fully disclosed in the aforementioned parent-subsidiary consolidated financial statements. Consequently, a separate set of consolidated financial statements of affiliated enterprises is not prepared.

Company name: Mayer Steel Pipe Corporation

Chairman: Chun-Fa Huang

March 19, 2021

Appendix II

Mayer Steel Pipe Corporation 2020 Earnings Distribution Table

Ending retained earnings: ··························································· NT$ 16,229,348 ·························································································· --------------------Add: Current net income after tax ················································· NT$ 392,624,239 : Revolving special surplus reserve ·········································· NT$ 28,832,472 Less: Provision of 10% legal reserve (Note 1)··································· (NT$ 38,857,620) : Adjustment of retained earnings for the defined benefit plan ·········· (NT$ 173,168) : Disposal of equity instruments at fair value through other comprehensive income ················································ (NT$ 3,874,871) ·························································································· ---------------------Earnings available for distribution: ················································ NT$ 394,780,400 ·························································································· ---------------------Distribution items Shareholders' bonus - cash dividend ($1.70* 222,526,100 shares) ················· 378,294,370 ·························································································· ---------------------Ending retained earning: ···························································· NT$ 16,486,030 ·························································································· =============

Note: The above earnings distribution shall prioritize 2020 earnings distribution. Shareholders' bonus is distributed in cash, and the proposed shareholders' bonus is distributed in cash dividends of $1.70 per share and the total distribution of shareholders’ bonus is $378,294,370, on the basis of 222,526,100 shares in issue at that time.
(Note 1): According to the Ministry of Economic Affairs Letter Shang-Zi No. 10802432410 dated January 9, 2020, the legal reserve shall be provided based on "the sum of net profit after tax for the period and included to the other items beyond the net profit after tax for the period shall be included in the undistributed earnings for the year."

Responsible person: Chun-Fa Huang Manager: Min-Chih Hsiao Chief accountant: Hui-Wen Li

Appendix III

Mayer Steel Pipe Corporation

Comparison between Original and Amendments to Articles of Incorporation

Articles	Amended provisions	Original provisions	Reference and reason for the amendment
Article 40	To the extent that the Company has profit in the year, the Company shall set aside 1% to 5% of such profit as employee remuneration and no more than 3% of such profit as director remuneration, provided that the Company shall first offset the cumulative losses, if any. The remuneration to the employees may be distributed in dividend or cash, eligible personnel includes employees of the Company and employees of subsidiaries meeting certain requirements. The remuneration to the Directors shall only be distributed in cash. Distribution of the employees' and Directors' remuneration shall be resolved by a majority vote at a Board meeting attended by over two-thirds of the Directors, and reported to the shareholder's meeting. If the employees' remuneration mentioned in the preceding paragraph is distributed in shares and resolved by the Board of Directors, a resolution may be resolved to issue new shares or buy back the Company’s shares in the same meeting. The Company’s dividend policy takes into account the Company’s capital demand and long-term financial planning, in line with the current and future development plans, takes into account the investment environment, domestic and foreign competition, as well as shareholders' interests, so as to determine the amount and types of earnings to be distributed. The earnings in the annual financial statements of the Company shall first be allocated to pay income tax and offset the accumulated losses of the preceding years before allocating 10% of the remaining earnings to the legal reserve, which is not applicable where the legal reserve has reached the paid-in capital. The Company shall also make provision or reversal for special reserve pursuant to the rules prescribed by the competent authority. However, if special surplus reserve is provided for the net deduction of other equity accumulated in the previous period, special surplus reserve of the same amount shall be provided from the remaining surplus in the previous period. If there are still deficiencies, the current after-tax net profit plus items other than the current after-tax net profit shall be included in the	To the extent that the Company has profit in the year, the Company shall set aside 1% to 5% of such profit as employee remuneration and no more than 3% of such profit as director remuneration, provided that the Company shall first offset the cumulative losses, if any. The remuneration to the employees may be distributed in dividend or cash, eligible personnel includes employees of the Company and employees of subsidiaries meeting certain requirements. The remuneration to the Directors shall only be distributed in cash. Distribution of the employees' and Directors' remuneration shall be resolved by a majority vote at a Board meeting attended by over two-thirds of the Directors, and reported to the shareholder's meeting. If the employees' remuneration mentioned in the preceding paragraph is distributed in shares and resolved by the Board of Directors, a resolution may be resolved to issue new shares or buy back the Company’s shares in the same meeting. The Company’s dividend policy takes into account the Company’s capital demand and long-term financial planning, in line with the current and future development plans, takes into account the investment environment, domestic and foreign competition, as well as shareholders' interests, so as to determine the amount and types of earnings to be distributed. The annual earnings in the financial statements of the Company shall first be allocated to pay income tax and offset the accumulated losses of the preceding years before allocating 10% of the remaining earnings to the legal reserve, which is not applicable where the legal reserve has reached the paid-in capital. The Company shall also make provision or reversal for special reserve pursuant to the rules prescribed by the competent authority. Together with accumulated undistributed earnings, the Board of Directors shall submit an earnings distribution proposal to be resolved at the shareholders'meeting.	I. According to J.C.Z.F. No.1090150022 and J.C.Z.F. No.10901500221 issued by Financial Supervisory Commission(Taiwan) as of Mar.31, 2021, it is proposed to amend the content of this article to meet the needs of the Company's future business development. II. The amendment to this Article was reviewed and approved by the 19th Audit Committee of the 2nd Session on Apr. 27th, 2021.

	current remaining surplus, and the undistributed surplus shall be accumulated with the previous year, and the Board of Directors shall draw up a surplus distribution proposal for resolution by the Shareholders' Meeting. The Company may distribute earnings in the form of cash dividends or share dividends. If the Company intended to distribute earnings, no less than 50% of the distributable earnings for the year shall be distributed as dividends to shareholders each year. Shareholder bonus shall be distributed in cash dividend. If it is distributed in share dividend, its ratio shall be no more than 50% of the total dividend. Where the above Shareholder bonus is distributed in cash, the Board of Directors is authorized to determine such amount by a resolution approved by a majority vote at a meeting attended by over two-thirds of the Directors and report to the shareholders'meeting.	The Company may distribute earnings in the form of cash dividends or share dividends. If the Company intended to distribute earnings, no less than 50% of the distributable earnings for the year shall be distributed as dividends to shareholders each year. Shareholder bonus shall be distributed in cash dividend. If it is distributed in share dividend, its ratio shall be no more than 50% of the total dividend. Where the above Shareholder bonus is distributed in cash, the Board of Directors is authorized to determine such amount by a resolution approved by a majority vote at a meeting attended by over two-thirds of the Directors and report to the shareholders' meeting.
Article 46	These Articles were established on August 9, 1959. The 1st amendment was approved on Aug. 09, 1959…………………, the 37th amendment on Jun. 25, 2010, the 38th amendment on Jun. 27, 2012, the 39th amendment on Jun. 12, 2015, the 40th amendment on Jun. 21, 2016, the 41st amendment on Jun. 19, 2017, the 42nd amendment on Jun. 12, 2019, the 43rd amendment on Jun. 8, 2021.	These Articles were established on August 9, 1959. The 1st amendment was approved on Aug. 09, 1959…………………, the 37th amendment on Jun. 25, 2010, the 38th amendment on Jun. 27, 2012, the 39th amendment on Jun. 12, 2015, the 40th amendment on Jun. 21, 2016, the 41st amendment on Jun. 19, 2017, the 42nd amendment on Jun. 12, 2019.	Record of the amendment date.

Appendix IV

Mayer Steel Pipe Corporation Comparison of the Amendments to Rules of Procedure for Shareholders Meetings

Provisions	Amended provisions	Original provisions	Reference and reason for the amendment
Article 4	The Chairperson shall call the meeting to order at the time scheduled for the meeting, as well as announce information such as the number of shares with no voting right and shares present. However, when the attending shareholders do not represent a majority of the total number of issued shares, the Chairman may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the Chairman shall declare the meeting adjourned. If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month. When, prior to the conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the Chairman may resubmit the tentative resolution for a vote by the shareholders' meeting pursuant to Article 174 of the Company Act.	The Chairman shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the chair shall declare the meeting adjourned. If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month. When, prior to conclusion of the meeting, the attending shareholders represent a majority of the total number of issued shares, the Chairman may resubmit the tentative resolution for a vote by the shareholders' meeting pursuant to Article 174 of the Company Act.	This article is amended with reference to Article 9 of the "Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings" amended on January 28, 2021 by the Taiwan Stock Exchange to enhance corporate governance and protect the interests of shareholders.
Article 19	These Rules were established on August 9, 1959. The 1st amendment was made on June 23, 1998, the 2nd amendment was made on June 18, 2002, the 3rd amendment was made on June 12, 2015, the 4th amendment was made on June 16, 2020, and the 5th amendment was made on June 8, 2021.	These Rules were established on August 9, 1959. The 1st amendment was made on June 23, 1998, the 2nd amendment was made on June 18, 2002, the 3rd amendment was made on June 12, 2015, and the 4th amendment was made on June 16, 2020.	Record of the amendment date.

Appendix VII

Mayer Steel Pipe Corporation Ethical Corporate Management Best Practice Principles

Article 1 Purpose of adoption and scope of application

To foster a corporate culture of ethical management and establish an internal control mechanism, so as to improve the sustainable operation and development of the Company and to maintain a sound business operation, the Company has formulated this code with reference to the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”.

The scope of application of these Principles includes the subsidiaries of the Company, any incorporated foundation in which the Company's accumulated contributions, direct or indirect, exceed 50 percent of the total funds of the foundation, and other group enterprises and organizations, such as institutions or juristic persons, substantially controlled by the Company ("group enterprises and organizations").

Article 2 Prohibition on unethical conduct
When engaging in commercial activities, Directors, managers, employees of the Company or persons having substantial control over the Company ("substantial controllers") shall not directly or indirectly offer, promise to offer, request or accept any improper benefits, nor commit unethical acts including breach of ethics, illegal acts, or breach of fiduciary duty ("unethical conduct") for purposes of acquiring or maintaining benefits.
Parties referred to in the preceding paragraph include civil servants, political candidates, political parties or members of political parties, state-run or private-owned businesses or institutions, and its Directors, supervisors, managers, employees or substantial controllers or other stakeholders.
Article 3 Types of benefits
"Benefits" in these Principles means any valuable things, including money, endowments, commissions, positions, services, preferential treatment or rebates of any type or in any name. However, benefits received or given occasionally in accordance with accepted social customs and that do not adversely affect specific rights and obligations shall be excluded.
Article 4 Compliance
The Company shall comply with the laws and regulations in which it is incorporated, Company Act, Securities and Exchange Act, Business Entity Accounting Act, Political Donations Act, Anti-Corruption Statute, Government Procurement Act, Act on Recusal of Public Servants Due to Conflicts of Interest, TWSE/GTSM listing rules, or other laws or regulations regarding commercial activities, as the underlying basic premise to facilitate ethical corporate management.
Article 5 Policy

The Company shall abide by the operational philosophies of honesty, transparency and responsibility, base policies on the principle of good faith and obtain approval from the Board of Directors, and establish good corporate governance and risk control and management mechanism so as to create an operational environment for sustainable development.

Article 6 Prevention programs

The Company shall formulate preventive measures on the basis of the operational philosophies mentioned in the preceding paragraph to proactively prevent unethical behaviors, including procedures, code of conduct, and related education and training. When establishing the prevention programs, the Company shall comply with relevant laws and regulations of the territory where the Company and its group enterprises and organizations.

In the course of developing the prevention programs, the Company is advised to negotiate with staff, members of labor unions or other representative institutions, and other stakeholders

Article 7 Scope of prevention programs

When formulating prevention programs, the Company shall analyze business activities within the business scope which are at a higher risk of being involved in unethical conduct, and shall strengthen relevant prevention measures.

Prevention programs formulated by the Company shall at least include preventive measures against the following behaviors:

Offering and acceptance of bribes.
Illegal political donations.
Improper charitable donations or sponsorship.
Offering or acceptance of unreasonable presents or hospitality, or other improper benefits.
Article 8 Commitment and implementation

The Company shall request the Directors and senior management to issue a statement of compliance with the ethical management policy and require in the terms of employment that employees comply with such policy.

The Company and its substantial controllers shall clearly specify in their rules and external documents and on the company website the ethical corporate management policies and the commitment by the Board of Directors and senior management on the rigorous and thorough implementation of such policies, and shall carry out the policies in internal management and in commercial activities.
The Company shall compile documented information on the ethical management policy, statement, commitment and implementation mentioned in the first and second paragraphs and keep the said information properly.
Article 9 Ethical management of commercial activities
The Company shall engage in commercial activities in a fair and transparent manner based on the principle of ethical management.
Prior to any commercial transactions, the Company shall take into consideration the legality of its agents, suppliers, clients, or other trading counterparties and whether any of them are involved in unethical conduct, and shall avoid any dealings with persons so involved.
When entering into contracts with their agents, suppliers, clients, or other trading counterparties, the Company shall include in such contracts terms requiring compliance with ethical corporate management policy and that in the event the trading counterparties are involved in unethical conduct, the Company may at any time terminate or rescind the contracts.
Article 10 Prohibition against offering and acceptance of bribes

When conducting business, the Company and its Directors, managers, employees, and substantial controllers, may not directly or indirectly offer, promise to offer, request, or

accept any improper benefits in whatever form to or from clients, agents, contractors, suppliers, public servants, or other stakeholders.

Article 11 Prohibition against illegal political donations When directly or indirectly offering a donation to political parties or organizations or individuals participating in political activities, the Company and its Directors, managers, employees, and substantial controllers shall comply with the Political Donations Act and their own relevant internal operational procedures, and shall not make such donations in exchange for commercial gains or business advantages.
Article 12 Prohibition against improper charitable donations or sponsorship When making or offering donations and sponsorship, the Company and its Directors, managers, employees, and substantial controllers shall comply with relevant laws and regulations and internal operational procedures, and shall not surreptitiously engage in bribery.
Article 13 Prohibition against unreasonable presents, hospitality, or other improper benefits The Company and its Directors, managers, employees, and substantial controllers shall not directly or indirectly offer or accept any unreasonable presents, hospitality or other improper benefits to establish a business relationship or influence commercial transactions.
Article 14 Prohibition against infringement of intellectual property rights The Company and its Directors, managers, employees, and substantial controllers shall observe applicable laws and regulations, the Company's internal operational procedures, and contractual provisions concerning intellectual property, and may not use, disclose, dispose, or damage intellectual property or otherwise infringe intellectual property rights without the prior consent of the intellectual property rights holder.
Article 15 Prohibition against engaging in unfair competitive practices The Company shall engage in business activities in accordance with applicable competition laws and regulations, and may not fix prices, make rigged bids, establish output restrictions or quotas, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce.
Article 14 Prevention of damage to stakeholders by products or services In the course of research and development, procurement, manufacture, provision, or sale of products and services, the Company and its Directors, managers, employees, mandataries, and substantial controllers shall observe applicable laws and regulations and international standards to ensure the transparency of information about, and safety of, their products and services. They shall also adopt and publish a policy on the protection of the rights and interests of consumers or other stakeholders, and carry out the policy in their operations, with a view to preventing their products and services from directly or indirectly damaging the rights and interests, health, and safety of consumers or other stakeholders. Where there are sufficient facts to determine that the Company's products or services are likely to pose any hazard to the safety and health of consumers or other stakeholders, the Company shall, in principle, recall those products or suspend the services immediately.
Article 17 Organization and responsibility The Directors, managers, employees, mandataries, and substantial controllers of the Company shall exercise the due care of good administrators to urge the Company to

prevent unethical conduct, always review the results of the preventive measures and continually make adjustments so as to ensure thorough implementation of its ethical corporate management policies.

To achieve sound ethical corporate management, the Company shall establish an ethical corporate management team under the Board of Directors, responsible for establishing and supervising the implementation of the ethical corporate management policies and prevention programs. The dedicated unit shall be in charge of the following matters, and shall report to the Board of Directors on a regular basis:

Assisting in incorporating ethics and moral values into the Company's business strategy and adopting appropriate prevention measures against corruption and malfeasance to ensure ethical management in compliance with the requirements of laws and regulations.
Formulate programs to prevent unethical conduct, and set out in each program the standard operating procedures and conduct guidelines with respect to the Company's operations and business.
Planning the internal organization, structure, and allocation of responsibilities and setting up check-and-balance mechanisms for mutual supervision of the business activities within the business scope which are possibly at a higher risk for unethical conduct.
Promoting and coordinating awareness and educational activities with respect to ethics policy.
Developing a whistle-blowing system and ensuring its operating effectiveness.
Assisting the Board of Directors and management in auditing and assessing whether the prevention measures taken for the purpose of implementing ethical management are effectively operating, and preparing reports on the regular assessment of compliance with ethical management in operating procedures.
Article 18 Legal compliance in business operations The Company and its Directors, managers, employees, mandataries, and substantial controllers shall comply with laws and regulations and the prevention programs when conducting business.
Article 19 Avoidance of interests
The Company shall adopt policies for preventing conflicts of interest to identify, monitor, and manage risks possibly resulting from unethical conduct, and shall also offer appropriate means for Directors, managers, and other stakeholders attending or present at Board meetings to voluntarily explain whether their interests would potentially conflict with those of the Company.
When a proposal at a given Board of Directors meeting concerns the personal interest of, or the interest of the juristic person represented by, any of the Directors, managers, and other stakeholders attending or present at Board meetings of the Company, the concerned person shall state the important aspects of the relationship of interest at the given board meeting. If his or her participation is likely to prejudice the interest of the Company, the concerned person may not participate in discussion of or voting on the proposal and shall recuse himself or herself from the discussion or the voting, and may not exercise voting rights as proxy for another Director. The Directors shall practice self-discipline and must not support one another in improper dealings.
The Company's Directors, managers, employees, mandataries, and substantial controllers shall not take advantage of their positions or influence in the Company to obtain improper benefits for themselves, their spouses, parents, children or any other person.

Article 20 Accounting and internal control

The Company shall establish effective accounting systems and internal control systems for business activities possibly at a higher risk of being involved in unethical conduct, not have under-the-table accounts or keep secret accounts, and conduct reviews regularly so as to ensure that the design and enforcement of the systems are showing results.

The internal audit unit of the Company shall examine the compliance of the system mentioned in the preceding paragraph and prepare an audit report, which shall be submitted to the Board of Directors. The internal audit unit may also engage a certified public accountant to carry out the audit, and may engage professionals to assist if necessary.

Article 21

Operational procedures and code of conduct

The Company shall establish operational procedures and code of conduct in accordance with Article 6 hereof to guide Directors, managers, employees, and substantial controllers on how to conduct business, which should at least contain the following matters:

Standards for determining whether improper benefits have been offered or accepted.
Procedures for offering legitimate political donations.
Procedures and the standard rates for offering charitable donations or sponsorship.
Rules for avoiding work-related conflicts of interest and how they should be reported and handled.
Rules for keeping confidential trade secrets and sensitive business information obtained in the ordinary course of business.
Regulations and procedures for dealing with suppliers, clients and business transaction counterparties suspected of unethical conduct.
Handling procedures for violations of these Principles.
Disciplinary measures on offenders.

Article 22 Education and training

The Chairman, General Manager, or senior management of the Company shall communicate the importance of corporate ethics to its Directors, employees, and mandataries on a regular basis.

The Company shall periodically organize training and awareness programs for Directors, managers, employees, mandataries, and substantial controllers and invite the Company's commercial transaction counterparties so they understand the Company's resolve to implement ethical corporate management, the related policies, prevention programs and the consequences of committing unethical conduct.

The Company shall apply the policies of ethical corporate management when creating its employee performance appraisal system and human resource policies to establish a clear and effective reward and discipline system.

Article 23 Whistle-blowing system

The Company shall adopt a concrete whistle-blowing system and scrupulously operate the system. The whistle-blowing system shall include at least the following:

An independent mailbox or hotline, either internally established and publicly announced or provided by an independent external institution, to allow internal and external personnel of the Company to submit reports.
Dedicated personnel or unit appointed to handle the whistle-blowing system. Any tip involving a Director or senior management shall be reported to the Independent Directors. Categories of reported misconduct shall be delineated and

  - standard operating procedures for the investigation of each shall be adopted.

Documentation of case acceptance, investigation processes, investigation results, and relevant documents.
Confidentiality of the identity of whistle-blowers and the content of reported cases.
Measures for protecting whistle-blowers from inappropriate disciplinary actions due to their whistle-blowing.
When material misconduct or likelihood of material impairment to the Company comes to its awareness upon investigation, the dedicated personnel or unit handling the whistle-blowing system shall immediately prepare a report and notify the Independent Directors in written form.
Article 24 Disciplinary and appeal system
The Company shall adopt and publish a well-defined disciplinary and appeal system for handling violations of the ethical corporate management rules, and shall make immediate disclosure on the Company's internal website of the title and name of the violator, the date and details of the violation, and the actions taken in response.
Article 25 Information disclosure
The Company shall collect quantitative data about the promotion of ethical management and continuously analyze and assess the effectiveness of the promotion of ethical management policy. The Company shall also disclose the measures taken for implementing ethical corporate management, the status of implementation, the foregoing quantitative data, and the effectiveness of promotion on the company websites, annual reports, and prospectuses, and shall disclose their ethical corporate management best practice principles on the Market Observation Post System.
Article 26 Review and amendment of ethical corporate management policies and measures The Company shall at all times monitor the development of relevant local and international regulations concerning ethical corporate management and encourage its Directors, managers, and employees to make suggestions, based on which the adopted ethical corporate management policies and measures taken will be reviewed and improved with a view to achieving better implementation of ethical management.
Article 27 Implementation

These Principles were established on November 11, 2020. These Principles, and any amendments hereto, shall be implemented after approval by the Audit Committee and the Board of Directors, and submitted to the shareholders' meeting.

Appendix VIII

Mayer Steel Pipe Corporation Procedures for Ethical Management and Guidelines for Conduct

Article 1 Purpose of adoption and scope of application

The Company engages in commercial activities following the principles of fairness, honesty, faithfulness, and transparency, and in order to fully implement a policy of ethical management and actively prevent unethical conduct, these Procedures for Ethical Management and Guidelines for Conduct (hereinafter, "Procedures and Guidelines") are adopted pursuant to the provisions of the Ethical Corporate Management Best Practice Principles for the Company and the applicable laws and regulations of the places where the Company and its group enterprises and organizations operate, with a view to providing all personnel of the Company with clear directions for the performance of their duties.

The scope of application of these Procedures and Guidelines includes the subsidiaries of the Company, any incorporated foundation in which the Company's accumulated contributions, direct or indirect, exceed 50 percent of the total funds of the foundation, and other group enterprises and organizations, such as institutions or juristic persons, substantially controlled by the Company.

Article 2 Applicable subjects

For the purposes of these Procedures and Guidelines, the term "personnel of the Company" refers to any Director, manager, employee, mandatary or person having substantial control of the Company or its group enterprises and organizations. Any provision, promise, request, or acceptance of improper benefits by any of the Company's personnel through a third party will be presumed to be an act by the Company's personnel.

Article 3 Unethical conduct

For the purposes of these Procedures and Guidelines, "unethical conduct" means that any personnel of the Company, in the course of their duties, directly or indirectly provides, promises, requests, or accepts improper benefits or commits a breach of ethics, unlawful act, or breach of fiduciary duty for purposes of acquiring or maintaining benefits.

The counterparties of the unethical conduct under the preceding paragraph include public officials, political candidates, political parties or their staffs, and governmentowned or private-owned enterprises or institutions and their Directors, supervisors, managerial officers, employees, persons having substantial control, or other interested parties.

Article 4 Types of benefits

For the purposes of these Procedures and Guidelines, the term "benefits" means any money, gratuity, gift, commission, position, service, preferential treatment, rebate, facilitating payment, entertainment, dining, or any other item of value in whatever form or name.

Article 5 Responsible unit and duties

The Company shall designate the audit department as the solely responsible unit (hereinafter, "responsible unit") under the Board of Directors to be in charge of the amendment, implementation, interpretation, and advisory services with respect to these Procedures and Guidelines, the recording and filing of reports, and the monitoring of implementation. The responsible unit shall be in charge of the following matters and

also submit regular reports to the Board of Directors:

Assisting in incorporating ethics and moral values into the Company's business strategy and adopting appropriate prevention measures against corruption and malfeasance to ensure ethical management in compliance with the requirements of laws and regulations.
Adopting programs to prevent unethical conduct and setting out in each program the standard operating procedures and conduct guidelines with respect to the Company's operations and business.
Planning the internal organization, structure, and allocation of responsibilities and setting up check-and-balance mechanisms for mutual supervision of the business activities within the business scope which are possibly at a higher risk for unethical conduct.
Promoting and coordinating awareness and educational activities with respect to ethics policy.
Developing a whistle-blowing system and ensuring its operating effectiveness.
Assisting the Board of Directors and management in auditing and assessing whether the prevention measures taken for the purpose of implementing ethical management are effectively operating, and preparing reports on the regular assessment of compliance with ethical management in operating procedures.
Preparing and retaining properly documented information such as ethical management policy and compliance statements, situations concerning the performance of undertakings and enforcement etc.

Article 6 Prohibition against providing or accepting improper benefits

Except under one of the following circumstances, when providing, accepting, promising, or requesting, directly or indirectly, any benefits as specified in Article 4, the conduct of the given personnel of the Company shall comply with the provisions of the Ethical Corporate Management Best Practice Principles for TWSE/GTSM-Listed Companies and these Procedures and Guidelines, and the relevant procedures shall have been carried out:

The conduct is undertaken to meet business needs and is in accordance with local courtesy, convention, or custom during domestic (or foreign) visits, reception of guests, promotion of business, and communication and coordination.
The conduct has its basis in ordinary social activities that are attended or others are invited to hold in line with accepted social custom, commercial purposes, or developing relationships.
Invitations to guests or attendance at commercial activities or factory visits in relation to business needs, when the method of fee payment, number of participants, class of accommodations, and the time period for the event or visit have been specified in advance.
Attendance at folk festivals that are open to and invite the attendance of the general public.
Rewards, emergency assistance, condolence payments, or honorariums from the management.
Money, property, or other benefits with a market value of NT$50,000 or less offered to or accepted from a person other than relatives or friends; or gifts of property with a total market value of NT$50,000 or less given by another party to the majority of the personnel of the Company, provided that the total market value of the property offered to the same counterparty or coming from the same source within a single fiscal year shall be limited to NT$100,000.
Property with a market value of NT$20,000 or less received due to engagement, marriage, maternity, relocation, assumption of a position, promotion or transfer,

  - retirement, resignation, or severance, or the injury, illness, or death of the recipient or the recipient's spouse or lineal relative.

Other conduct that complies with the rules of the Company.
Article 7 Procedures for handling the acceptance of improper benefits Except under any of the circumstances set forth in the preceding article, when any personnel of the Company are provided with or are promised, either directly or indirectly, any benefits as specified in Article 4 by a third party, the matter shall be handled in accordance with the following procedures:
If there is no relationship of interest between the party providing or offering the benefit and the official duties of the Company's personnel, the personnel shall report to their immediate supervisor within 3 days from the acceptance of the benefit, and the responsible unit shall be notified if necessary.
If a relationship of interest does exist between the party providing or offering the benefit and the official duties of the Company's personnel, the personnel shall return or refuse the benefit, and shall report to his or her immediate supervisor and notify the responsible unit. When the benefit cannot be returned, then within 3 days from the acceptance of the benefit, the personnel shall refer the matter to the responsible unit for handling.
"A relationship of interest between the party providing or offering the benefit and the official duties of the Company's personnel," as referred to in the preceding paragraph, refers to one of the following circumstances:
When the two parties have commercial dealings, a relationship of direction and supervision, or subsidies (or rewards) for expenses.
When a contracting, trading, or other contractual relationship is being sought, is in progress, or has been established.
Other circumstances in which a decision regarding the Company's business, or the execution or non-execution of business, will result in a beneficial or adverse impact.

The responsible unit of the Company shall make a proposal, based on the nature and value of the benefit under paragraph 1, that it be returned, accepted on payment, given to the public, donated to charity, or handled in another appropriate manner. The proposal shall be implemented after being reported and approved.

Article 8 Prohibition against and handling procedure for facilitating payments The Company shall neither provide nor promise any facilitating payment. If any personnel of the Company provides or promises a facilitating payment under threat or intimidation, it shall be handled according to the procedures in Article 7. Upon receipt of the report under the preceding paragraph, the responsible unit shall take immediate action and undertake a review of relevant matters in order to minimize the risk of recurrence. In a case involving alleged illegality, the responsible unit shall also immediately report to the relevant judicial agency.
Article 9 Procedures for handling political contributions Political contributions by the Company shall be made in accordance with the following provisions, reported to the supervisor in charge for approval, and a notification shall be given to the responsible unit, and when the amount of a contribution is NT$1,000,000 or more, it shall be made only after being reported to and approved by the Board of Directors:
It shall be ascertained that the political contribution is in compliance with the laws and regulations governing political contributions in the country in which the recipient is located, including the maximum amount and the form in which a

contribution may be made.

A written record of the decision-making process shall be kept.
Account entries shall be made for all political contributions in accordance with applicable laws and regulations and relevant procedures for accounting treatment.
In making political contributions, commercial dealings, applications for permits, or carrying out other matters involving the interests of the Company with the related government agencies shall be avoided.
Article 10 Procedures for handling charitable donations or sponsorships

The annual total amount of charitable donations or sponsorships by the Company shall not exceed 0.1% of the total operating income for the year. Amendments to the annual total amount are subject to the resolution by the Board of Directors. Charitable donations or sponsorships within limit shall be provided in accordance with the following provisions and procedures, submitted by the unit in charge to the Company’s shareholders' meeting for approval, brought to the attention of the responsible unit, and reported in the Board meeting. When the annual total amount exceeds the limit, except for charity donations for severe natural disasters that may be submitted to the following Board meeting for retroactive recognition, the rest is subject to the approval by the Board of Directors.

It shall be ascertained that the donation or sponsorship is in compliance with the laws and regulations of the country where the Company is doing business.
The purpose of the donation is limited to the purpose of donation for domestic or overseas severe emergency events.
A written record of the decision making process shall be kept.
A charitable donation shall be given to a valid charitable institution and may not be a disguised form of bribery.
The returns received as a result of any sponsorship shall be specific and reasonable, and the subject of the sponsorship may not be a counterparty of the Company's commercial dealings or a party with which any personnel of the Company has a relationship of interest.
After a charitable donation or sponsorship has been given, it shall be ascertained that the destination to which the money flows is consistent with the purpose of the contribution.

Article 11

Recusal
When a Director, manager, or other stakeholders of the Company attending or present at a Board meeting, or the juristic person represented thereby, has a stake in a proposal in the meeting, such a Director, manager, or stakeholder shall state the important aspects of the stake in the meeting and, where there is a likelihood that the interests of the Company would be prejudiced, may not participate in the discussion or vote on that proposal, shall recuse himself or herself from any discussion and voting, and may not exercise voting rights as proxy on behalf of another Director. The Directors shall exercise discipline among themselves, and may not support each other in an inappropriate manner.
If in the course of conducting company business, any personnel of the Company discovers that a potential conflict of interest exists involving themselves or the juristic person that they represent, or that they or their spouse, parents, children, or a person with whom they have a relationship of interest is likely to obtain improper benefits, the personnel shall report the relevant matters to both his or her immediate supervisor and the responsible unit, and the immediate supervisor shall provide the personnel with proper instructions.

No personnel of the Company may use company resources on commercial activities

other than those of the Company, nor may any personnel's job performance be affected by his or her involvement in the commercial activities other than those of the Company.

Article 12 Special unit in charge of confidentiality regime and its responsibilities The Company shall set up a special unit charged with formulating and implementing procedures for managing, preserving, and maintaining the confidentiality of the Company's trade secrets, trademarks, patents, works and other intellectual properties and it shall also conduct periodical reviews on the results of implementation to ensure the sustained effectiveness of the confidentiality procedures.
All personnel of the Company shall faithfully follow the operational directions pertaining to intellectual properties as mentioned in the preceding paragraph and may not disclose to any other party any trade secrets, trademarks, patents, works, and other intellectual properties of the Company of which they have learned, nor may they inquire about or collect any trade secrets, trademarks, patents, and other intellectual properties of the Company unrelated to their individual duties.
Article 13 Prohibition against unfair competitive practices The Company shall follow the Fair Trade Act and applicable competition laws and regulations when engaging in business activities, and may not fix prices, make rigged bids, establish output restrictions or quotas, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce.
Article 14 Prevention of damage caused by products and services to stakeholders The Company shall gather relevant information of and understand the applicable laws and regulations and international standards governing its products and services which it shall observe and provide necessary explanations in the internal meetings of the Company to ensure the transparency and safety of the products and services in the course of their research and development, procurement, manufacture, provision, or sale of products and services.
If the Company's products or services directly or indirectly pose any harm to the interest, health, and safety of the consumers or other stakeholders, the Company shall disclose measures and policies that protect the interest of its consumers or other stakeholders in the stakeholder section of its website.
If a third party (including but not limited to media reports) discloses that the Company's products or services are likely to pose any harm to the safety and health of the consumers or other stakeholders, provided that the government department has already given an order to recall those products with potential danger or cease such services, the Company shall verify the facts and present a review and improvement plan.
The responsible unit of the Company shall report the event as in the preceding paragraph, actions taken, and subsequent reviews and corrective measures taken to the Board of Directors.
Article 15 Prohibition against insider trading and non-disclosure agreement All personnel of the Company shall adhere to the provisions of the Securities and Exchange Act, and may not take advantage of undisclosed information of which they have learned to engage in insider trading. Such personnel are also prohibited from divulging undisclosed information to any other party, in order to prevent other parties from using such information to engage in insider trading.
Any organization or person outside of the Company that is involved in any merger, demerger, acquisition and share transfer, major memorandum of understanding, strategic alliance, other business partnership plan, or the signing of a major contract by the Company shall be required to sign a non-disclosure agreement in which they

undertake not to disclose to any other party any trade secret or other material information of the Company acquired as a result, and that they may not use such information without the prior consent of the Company.

Article 16 Compliance and announcement of policy of ethical management The Company shall disclose its policy of ethical management in its internal rules, annual reports, on the Company's websites, and in other promotional materials, and shall make timely announcements of the policy in events held for outside parties such as product launches and investor press conferences, in order to make its suppliers, customers, and other business-related institutions and personnel fully aware of its principles and rules with respect to ethical management.
Article 17 Ethical management evaluation prior to development of commercial relationships Before developing a commercial relationship with another party, such as an agent, supplier, customer, or other counterparty in commercial dealings, the Company shall evaluate the legality and ethical management policy of the party and ascertain whether the party has a record of involvement in unethical conduct, in order to ensure that the party conducts business in a fair and transparent manner and will not request, offer, or take bribes.

When the Company carries out the evaluation under the preceding paragraph, it may adopt appropriate audit procedures for a review of the counterparty with which it will have commercial dealings with respect to the following matters, in order to gain a comprehensive knowledge of its ethical management:

The enterprise's nationality, location of business operations, organizational structure, and management policy, and place where it will make payment.
Whether the enterprise has adopted an ethical management policy, and the status of its implementation.
Whether enterprise's business operations are located in a country with a high risk of corruption.
Whether the business operated by the enterprise is in an industry with a high risk of bribery.
The long-term business condition and degree of goodwill of the enterprise.
Consultation with the enterprise's business partners on their opinion of the enterprise.
Whether the enterprise has a record of involvement in unethical conduct such as bribery or illegal political contributions.
Article 18 Statement of ethical management policy to counterparties in commercial dealings All personnel of the Company, when engaging in commercial activities, shall make a statement to the trading counterparty about the Company's ethical management policy and related rules, and shall clearly refuse to provide, promise, request, or accept, directly or indirectly, any improper benefit in whatever form or name.
Article 19 Avoidance of commercial dealings with unethical operators All personnel of the Company shall avoid business transactions with an agent, supplier, customer, or other counterparty in commercial interactions that is involved in unethical conduct. When the counterparty or partner in cooperation is found to have engaged in unethical conduct, the personnel shall immediately cease dealing with the counterparty and blacklist it for any further business interaction in order to effectively implement the Company's ethical management policy.
Article 20 Stipulation of terms of ethical management in contracts Before entering into a contract with another party, the Company shall gain a thorough

knowledge of the status of the other party's ethical management, and shall make observance of the ethical management policy of the Company part of the terms and conditions of the contract, stipulating at the least the following matters:

When a party to the contract becomes aware that any personnel has violated the terms and conditions pertaining to prohibition of acceptance of commissions, rebates, or other improper benefits, the party shall immediately notify the other party of the violator's identity, the manner in which the provision, promise, request, or acceptance was made, and the monetary amount or other improper benefits that were provided, promised, requested, or accepted. The party shall also provide the other party with pertinent evidence and cooperate fully with the investigation. If there has been resultant damage to either party, the party may claim from the other party twenty percent of the contract price as damages, and may also deduct the full amount of the damages from the contract price payable.
Where a party is discovered to be engaged in unethical conduct in its commercial activities, the other party may terminate or rescind the contract unconditionally at any time.
Specific and reasonable payment terms, including the place and method of payment and the requirement for compliance with related tax laws and regulations.
Article 21 Handling of unethical conduct by personnel of the Company The Company encourages insiders and outsiders for informing unethical or unseemly conduct. However, insiders making a false report or malicious accusation shall be subject to disciplinary action and be removed from office if the circumstance concerned is material.

The Company shall establish and announce an independent mailbox or hotline on its website and the intranet for insiders and outsiders of the Company to submit reports. A whistle-blower shall at least furnish the following information:

The whistle-blower's name and ID number, and an address, telephone number and e-mail address where it can be reached.
The informed party's name or other information sufficient to distinguish its identifying features.
Specific facts available for investigation.

Personnel of the Company handling whistle-blowing matters shall represent in writing they will keep the whistleblowers' identity and contents of information confidential. The Company also undertakes to protect the whistleblowers from improper treatment due to their whistleblowing. The responsible unit of the Company shall observe the following procedure:

Information shall be reported to the shareholders' meeting if involving general employees and to Independent Directors if involving whistle-blowing matters or Directors or senior management.
The responsible unit of the Company and the department head or personnel being reported to in the preceding subparagraph shall immediately verify the facts and, where necessary, with the assistance of the legal compliance or other related department.
If a person being informed of is confirmed to have indeed violated the applicable laws and regulations or the Company's policy and regulations of ethical management, the Company shall immediately require the violator to cease the conduct and shall make an appropriate punishment. When necessary, the Company will seek damages through legal proceedings to safeguard its reputation and interests.
Documentation of case acceptance, investigation processes and investigation results shall be retained for five years and may be retained electronically. In the

event of a suit in respect of the whistleblowing case before the retention period expires, the relevant information shall continue to be retained until the conclusion of the litigation.

With respect to whistle-blowing cases proved to be true after investigation, the Company shall charge relevant units with the task of reviewing the internal control system and relevant procedures and proposing corrective measures to prevent a recurrence.
The responsible unit of the Company shall submit to the Board of Directors a report on the whistleblowing case, actions taken, and subsequent reviews and corrective measures.
Article 22 Actions upon event of unethical conduct by others towards the Company If any personnel of the Company discovers that another party has engaged in unethical conduct towards the Company, and such unethical conduct involves alleged illegality, the Company shall report the relevant facts to the judicial and prosecutorial authorities; where a public service agency or public official is involved, the Company shall additionally notify the governmental anti-corruption agency.
Article 23 Internal awareness sessions and establishment of a system for rewards, penalties, and complaints, and related disciplinary measures
The responsible unit of the Company shall organize one awareness sessions each year and arrange for the Chairman, General Manager, or senior management to communicate the importance of ethics to its Directors, employees, and mandataries. The Company shall link ethical management to employee performance evaluations and human resources policy, and establish clear and effective systems for rewards, penalties, and complaints.
If any personnel of the Company seriously violates ethical conduct, the Company shall dismiss the personnel from his or her position or terminate his or her employment in accordance with applicable laws and regulations or the personnel policy and procedures of the Company

The Company shall disclose on its intranet information the title and name of the violator, the date and details of the violation, and the actions taken in response.

Article 24 Implementation

These Procedures and Guidelines were established on November 11, 2020. These Principles and Guidelines, and any amendments hereto, shall be implemented after approval by the Audit Committee and the Board of Directors, and submitted to the shareholders' meeting.

Appendix IX

The number of shares held by individual and all Directors recorded on the shareholder register as of April 10, 2021:

Total number of issued shares of the Company as of April 10, 2021: 222,526,100 shares

The minimum number of shares held by all Directors required by the laws: 12,000,000 shares.

il		Number of shares held recorded i hhl i h k
Tte	Name	n sareoders regster on te boo closure date
(Over 10% shareholding) Chairman Director Director Director	Yuan Chuan Steel Co., Ltd Representative: Chun-Fa Huang Representative: Chun-Chao Huang Representative: Hsiu-Mei Huang Representative:Yung-Chieh Huang	36,962,353
Director Director	Cheng Ta International Investment Co., Ltd. Representative: Ta-Teng Cheng Representative: Yung-Fen Lin	211,000
IndependentDirector	Chih-Ling Chen	0
Independent Director	Ching-Chuan Lo	0
IndependentDirector	Huang-Chi Liu	0
	Director Total	37,173,353

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MAYER PIPE — AGM Information 2021

51948_rns_2021-08-02_18ce32d9-bcd7-4ada-b3a4-44c9312354cf.pdf

Mayer Steel Pipe Corporation Minutes of 2021 Annual Shareholders' Meeting

Report on the 2020 Business:

Business Report

IV. Operating Income: Unit: NT$'000

V. Fulfillment of Expected Amount:

VI. Profitability Analysis:

2. Skills

Audit Committee's Review Report

Audit Committee's Review Report

Report on the Distribution of Remuneration for Employees and Directors in 2020:

Report on the earnings distribution by way of cash dividends in 2020:

Report of the Company's Ethical Corporate Management Best Practice Principles:

Report of the Company's Procedures for Ethical Management and Guidelines for Conduct:

Other report matters:

Appendix I INDEPENDENT AUDITORS’ REPORT

Opinion

Basis of opinion

Key Audit Matters

Valuation of inventory

Valuation of financial assets

Other Matters

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

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

Notice to Readers

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY BALANCE SHEETS December 31, 2020 and 2019

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF COMPREHENSIVE INCOME For the Years Ended December 31, 2020 and 2019

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF CHANGES IN EQUITY

Mayer Steel Pipe Corporation

PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2020 and 2019

INDEPENDENT AUDITORS’ REPORT

Opinion

Basis of opinion

Key Audit Matters

Valuation of inventory

Valuation of financial assets

Other Matters

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

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

Notice to Readers

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED BALANCE SHEETS

December 31, 2020 and 2019

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the Years Ended December 31, 2020 and 2019

Mayer Steel Pipe Corporation and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

Mayer Steel Pipe Corporation and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2020 and 2019

Statement of Declaration

We hereby certify that

Appendix II

Mayer Steel Pipe Corporation 2020 Earnings Distribution Table

Appendix III

Mayer Steel Pipe Corporation

Appendix IV

Mayer Steel Pipe Corporation Comparison of the Amendments to Rules of Procedure for Shareholders Meetings

Appendix VII

Mayer Steel Pipe Corporation Ethical Corporate Management Best Practice Principles

Article 21

Operational procedures and code of conduct

Article 22 Education and training

Article 23 Whistle-blowing system

Appendix VIII

Mayer Steel Pipe Corporation Procedures for Ethical Management and Guidelines for Conduct

Article 11

Appendix IX

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MAYER PIPE AGM Information 2021