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RECTRON Annual Report 2025

Apr 30, 2026

51998_rns_2026-04-30_98100f20-6296-4ba9-b901-6e1a1eedcfc0.pdf

Annual Report

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Stock Code: 2302

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RECTRON LTD.

2025 ANNUAL REPORT

Printing Date: April 27, 2026 Website: http://mops.twse.com.tw/

1. Company Spokesperson and Acting Spokesperson:

Spokesperson:

Name: Lin Jui Ping

Title: Deputy General Manager of General Administration and General Manager of the Electronic Business Department

Phone: (02) 2880-1122 Email: [email protected] Acting Spokesperson: Name: Wang Tsuo Tzu Title: Deputy Manager of the Accounting Department Phone: (02) 2880-1122

Email: [email protected]

2. Address and Phone Numbers of Head Office and Factory:

Head Office:

Address: No. 192-2, Section 4, Chengde Road, Shilin District, Taipei City 11167 Phone: (02) 2880-1122

Factory:

Address: No. 71, Zhongshan Road, Tucheng District, New Taipei City 23680 Phone: (02) 2268-1314

3. Share Transfer Agency:

Name: IBF Securities Co., Ltd., Stock Transfer Agency Department

Address: 15F, No. 188, Section 5, Nanjing East Road, Songshan District, Taipei City 105411 Website: www.wls.com.tw

Phone: (02) 2528-8988

4. Certified Public Accountants and Audit Firm for the Recent Annual Financial Report:

Accountant Names: Shih-Chin Chih, Huang, Hsin-Ting Firm Name: An-Hou Jianye Certified Public Accountants Address: 68F, No. 7, Section 5, Xinyi Road, Taipei City 11049 Website: www.kpmg.com.tw Phone: (02) 8101-6666

5. Name of Overseas Stock Exchange for Trading and Method of Obtaining Information on Overseas Securities: N/A

6. Company Website: www.rectron.com.tw

Table of Contents

1. Report to Shareholders ............................................................................................................................... 1 2. Corporate Governance Report 1. Information of Directors, Supervisors, the General Manager, Deputy General Managers, Assistant Managers, and Heads of Departments .................................................................................. 6 2. Corporate Governance Practices ......................................................................................................... 25 3. Information on Auditor's Remuneration ............................................................................................. 69 4. Information on Change of Auditors .................................................................................................... 69 5.The Chairman, General Manager, or individuals responsible for finance or accounting management of the company who have served in the affiliated firm of the signing auditor or its related entities in the past years. ............................................................................. 69 6.Changes in the transfer of share ownership and share pledge by directors, supervisors, managers, and shareholders with a stake exceeding 10% during the recent fiscal year and up to the date of printing the annual report .............................................................................................. 70 7. Information on related parties or relatives within the second degree of kinship among the top ten shareholders in terms of shareholding percentage ........................................................................ 71 8. The shares held by the Company, its Directors, Supervisors, managers, and enterprises directly or indirectly controlled by the Company in the same reinvested enterprise, and the comprehensive shareholding ratio calculated on a consolidated basis. .............................................. 72 3. Funding Status 1. Share Capital and Shares .................................................................................................................... 73 2. Bond Issuance by the Company. ......................................................................................................... 77 3. Preferred Shares Issuance by the Company. ....................................................................................... 77 4. American Depositary Receipts (ADRs) Issuance by the Company. ................................................... 77 5. Employee Stock Options Issuance by the Company .......................................................................... 77 6. Accumulated information until the printing date of the annual report regarding managers who obtained employee stock options and the top ten employees in terms of the number of stock options exercisable, including their names, acquisition details, and exercise status ................. 77 7. Restricted Employee Stock Issuance by the Company. ...................................................................... 77 8. Accumulated information until the printing date of the annual report regarding managers who obtained restricted employee stocks and the top ten employees in terms of the number of shares acquired, including their names and acquisition status. ...................................................... 77 9. Issuance of New Shares in Merger or Acquisition of Other Companies. ........................................... 77 10.Execution Status of Fund Utilization Plan. ........................................................................................ 77 4. Operation Overview 1. Business Contents ............................................................................................................................... 78 2. Market and production/sales overview. .............................................................................................. 84

  1. Number of employees in the company. ............................................................................................... 88 4. Environmental expenditure information ............................................................................................. 88 5. Labor-Management Relations ............................................................................................................. 89 6. Information on information technology and cybersecurity management. .......................................... 90 7. Key contracts and agreements. ........................................................................................................... 91 5. Review Analysis and Risk Assessment of Financial Status and Financial Performance 1. Financial Status ................................................................................................................................... 92 2. Financial Performance ........................................................................................................................ 93 3. Cash Flow ........................................................................................................................................... 94 4. The impact of significant capital expenditures in the most recent fiscal year on financial operations. ........................................................................................................................................... 95 5. The recent year's investment policy and the main reasons for profitability or loss in investments, along with improvement plans and future one-year investment plans. ....................... 95 6. Analysis and assessment of risk factors. ............................................................................................. 95 7. Other important matters. ..................................................................................................................... 98 6. Special Notes 1. Related information on affiliated enterprises ...................................................................................... 99 2. Private placement of tradable securities in the recent fiscal year and up to the date of printing of the annual report ............................................................................................................................. 99 3. Holdings or disposals of the company's shares by subsidiary companies in the recent fiscal year and up to the date of printing of the annual report ...................................................................... 99 4. Other necessary supplementary explanations. .................................................................................... 99 7. Major events in the most recent year up until the publication date of the annual report with significant impact on shareholders’ equity or stock price. .................................................................... 99 Appendix I: Consolidated Financial Statements ........................................................................................ 99 Appendix II: Individual Financial Statements ............................................................................................ 99

1. Report to Shareholders

Dear Shareholders,

First and foremost, we extend our sincere gratitude to all our shareholders for their long-standing support and encouragement of the Rectron Group.

Reflecting on 2025, global supply chains had previously maintained high inventory levels in anticipation of pandemic-related disruptions. However, in 2024, volatile global political and economic conditions led to weakened end-consumer demand and a significant slowdown in procurement momentum, resulting in slower-than-expected inventory destocking. It was not until 2025 that market demand began to recover as inventory adjustments gradually concluded.

The Company’s consolidated revenue for 2025 reached NT$845,768 thousand, an increase of NT$88,311 thousand or approximately 12% compared to NT$757,457 thousand in 2024. Net income after tax for the period was NT$81,873 thousand, a decrease of NT$43,658 thousand or approximately 35% from NT$125,531 thousand in 2024. Basic earnings per share (EPS) stood at NT$0.49, also representing a 35% decrease from NT$0.75 in the previous year.

In recent years, evolving US-China trade relations, along with tariffs and trade barriers, have reshaped the global industrial landscape. In response to these market trends, the Company has actively expanded its presence in automotive electronics, industrial control, and consumer electronics. We have also strengthened the marketing of our proprietary brands to increase market share and enhance our overall competitive advantage. Simultaneously, we continue to elevate customer service quality and deepen client relationships to drive further operational growth momentum.

Looking ahead, the Rectron Group will continue to strengthen its core competencies, increase product value-add, and enhance the efficiency of resource integration. By leveraging these operational synergies, we aim to move steadily toward sustainable growth.

We would like to express our deepest gratitude to all shareholders for your long-standing support and for taking the time to attend today’s meeting. Building on a solid foundation, the Company has continued to grow while remaining committed to maximizing shareholder value. Facing a volatile and challenging business environment, we will maintain a proactive yet prudent approach - continuously driving innovation, deepening brand value, and improving management performance to secure the greatest long-term interests for our shareholders.

Chairman LIN WENG-TENG

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1. Operating Results for the Year 2025

(1) Achievement of Operating Plan:

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Unit: NTD in thousands; %
Amount of Increase
Year 2025 Year 2024 (Decrease)
Percentage of
Difference Increase
Item Amount Amount Amount (Decrease)%
Operating Revenue 845,768 757,457 88,311 12
Operating Cost 535,970 481,413 54,557 11
Operating Gross Profit 309,798 276,044 33,754 12
Operating Expenses 192,634 199,273 (6,639) (3)
Operating Profit (Loss) 117,164 76,771 40,393 53
Non-Operating
6,342 78,834 (72,492) (92)
Revenue (Expenses)
Consolidated Pre-tax
123,506 155,605 (32,099) (21)
Net Income (Loss)
Income Tax Expense 41,633 30,074 11,559 38
Consolidated Total Net
81,873 125,531 (43,658) (35)
Income (Loss)
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In 2025, the Company benefited from the completion of inventory destocking from the previous period and a gradual recovery in market demand. Consolidated revenue reached NT$845,768 thousand, representing growth over the NT$757,457 thousand recorded in 2024. Furthermore, driven by our proactive expansion into the automotive electronics and smart meter markets in India, gross profit for 2025 rose to NT$309,798 thousand, an increase compared to NT$276,044 thousand in 2024.

Despite intense market competition, the Company remained committed to proprietary brand marketing, market strategic layout, and refined cost control measures. As a result, operating expenses for 2025 remained comparable to those of 2024. However, influenced by the broader macroeconomic environment and its impact on foreign exchange gains and losses, non-operating income and expenses for 2025 totaled NT$6,345 thousand, a decrease of NT$72,492 thousand from NT$78,834 thousand in 2024. Taking these factors into account, net income after tax for the year was NT$81,873 thousand, reflecting a slight decrease of NT$43,658 thousand compared to NT$125,531 thousand in the previous year.

(2) Regarding the budget execution:

In accordance with the guidelines for handling public financial forecasts of publicly traded companies, the company did not have a public financial forecast for the year 2025.

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  • (3) Financial income and profitability analysis

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Unit: %
Analysis Item Year 2025 Year 2024
Debt to Assets Ratio (%) 30.62 30.68
Financial Ratio of Long-Term Capital to Real Estate, 324.72 300.50
Structure (%) Plant, and Equipment (%)
Current ratio (%) 141.02 133.25
Debt-Paying
Capacity (%) Quick Ratio (%) 118.24 115.18
Return on assets (%) 3.12 5.05
Return on Shareholder Equity (%) 4.5 6.96
Profitability Net Profit Margin (%) 9.68 16.57
(%) Earnings Per Share (NT$) 0.49 0.75
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(4) Research and Development Status

In 2025 and 2024, the Company’s consolidated R&D expenses for 2025 and 2024 were NT$5,884 thousand and NT$6,675 thousand, respectively, both representing 1% of the total revenue for their corresponding periods. These investments were primarily directed toward the implementation of automated packaging processes and innovative manufacturing technologies.

Looking ahead, the Company will continue to focus on optimizing product processes, developing new products, and enhancing automated production lines to increase the flexibility and efficiency of capacity utilization.

2. Overview of 2026 Business Plan

  1. Business Policy

  2. (1)Strengthen the marketing system and expand market presence by proactively building and enhancing specialized marketing teams both domestically and internationally. Deepen collaborations with strategic partners to broaden distribution channels and application markets, thereby further boosting the company's overall revenue performance.

  3. (2)Promote process automation and enhance production stability by continuously introducing and upgrading automated manufacturing equipment. This approach reduces risks associated with labor shortages, meets diverse customer demands, and ensures the stable delivery of high-quality products.

  4. (3)Strengthen the integration of IT and industrialization to leverage the benefits of big data. Accelerate the convergence of information technology and industrial processes by establishing a comprehensive production and sales database. Utilize big data for integrated analysis to enhance decision-making efficiency and further strengthen the company's overall competitiveness.

  5. (4)Expanding the automotive product line to capture growth opportunities. We continue to invest in the development of automotive-grade small-signal components, with a strong focus on the automotive electronics market. By building a comprehensive product portfolio, we aim to meet diverse market demands and strengthen our position in this rapidly growing sector.

2. Expected Sales Volume and Basis

The Company anticipates a moderate growth in sales volume for 2026 compared to 2025. This growth is primarily attributed to the continued strengthening of our sales teams and our proactive expansion into the automotive electronics markets in India and

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the United States, which has steadily driven up related demand.

Furthermore, the ongoing global supply chain restructuring and the order-shift effect (diversification of suppliers) triggered by geopolitical tensions continue to gain momentum. These factors are expected to further bolster the Company’s overall shipment performance.

Considering that the overall business environment remains characterized by high uncertainty, the Company will continue to adhere to the principles of prudence and stability in its operations. We remain committed to strengthening our risk management mechanisms and actively investing in the development of new product part numbers (P/Ns). This strategy is designed to meet diverse application requirements across various industries, ensuring the Company’s sustained and stable operational growth.

3. Important Sales and Marketing Policies

The production and sales policy of our company is a combination of planned and order-based production strategies. Based on changes in industry conditions, market supply and demand, internal production capacity, and inventory levels, we continuously develop rolling production and sales plans. These plans are dynamically adjusted with inventory control measures to maintain optimal inventory levels and enhance operational efficiency.

3. Company's Future Development Strategies

  1. Customer-Centric Approach: Creating Value in Partnership with Market Leaders. Adhering to a customer-oriented business philosophy, we actively collaborate with leading market brands to jointly develop innovative products. This ongoing partnership helps us continuously enhance the company's value and market position.

  2. Deepening Customer Relationships and Expanding a Diverse Product and Service Portfolio. We focus on strengthening our existing customer base by extending a diversified product line that addresses their specific needs. Through offering one-stop solutions, we aim to enhance customer loyalty and deepen our collaborations.

  3. Strengthening Key Technologies to Build Competitive Manufacturing Advantages. We are actively investing in the research, development, and mass production capabilities of key components, enhancing product technology content and supply flexibility. This further strengthens the company’s competitive advantage within the industry value chain.

4. Impact of External Competitive, Regulatory, and Macro-Economic Environment.

  1. External Competitive Environment

As industrial trends evolve, the competitive landscape of the diode market has gradually shifted from a purely price-driven model to a technology- and application-oriented approach. The overall market is characterized by rapid changes and increasingly intensified competition.

Although the Company faces multifaceted competitive pressures from global peers, we have established a solid sales network and a professional customer base by leveraging our long-term experience in high-niche markets across Europe and the United States. Simultaneously, the Company is proactively expanding into the automotive electronics and smart meter markets in India. By refining cost control, strengthening differentiated product design, and providing superior customer service, we continue to enhance our overall market competitiveness, further solidifying customer loyalty and the stability of our collaborative relationships.

2. Regulatory Environment

Our Company has always strictly adhered to relevant domestic and international laws,

~ 4 ~

regulations, and industrial policies. We have established comprehensive management mechanisms across various functions-including finance, shareholder services, auditing, and legal affairs-to continuously monitor regulatory trends and policy developments.

All operational activities are executed in accordance with our internal control systems and Standard Operating Procedures (SOPs) to ensure full compliance with legal requirements and principles of corporate governance. Based on our assessment, there are currently no major regulatory changes that have a material impact on the Company’s finances or business operations, and overall operations remain stable.

3. Impact of Overall Business Environment

With global inflationary pressures gradually easing and monetary policy adjustments by major economies taking effect, the overall economic environment is showing a trend of moderate recovery. However, factors such as geopolitical risks, international trade uncertainties, and regional conflicts continue to impact market confidence, keeping the overall operating environment challenging.To navigate these external shifts, the Company will remain focused on high-value-added product markets while deepening our core customer service and technical support capabilities. Furthermore, we will enhance manufacturing efficiency and cost control to maintain our competitive advantage and strengthen our operational resilience.

In recent years, the Company has achieved sustained growth built upon a foundation of steady operations and remains dedicated to creating long-term value for our shareholders. In the face of multifaceted and uncertain future challenges, we will maintain a proactive yet prudent stance—continuously driving innovation, optimizing our business models, and deepening our brand value. By enhancing overall management performance, we remain committed to achieving our ultimate goal of maximizing shareholder equity.

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2. Corporate Governance Report

1. Information of Directors, Supervisors, the General Manager, Deputy General Managers, Assistant Managers, and Heads of Departments

  1. Information of Directors and Supervisors

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March 31, 2026
J Nationalit Name Gender/ Appointme T Initial Time of Election Currently Spouse and Under Others' Key Current Positions Held in Other Executives, Directors, or
o y or Place Age nt e Date of Shares Held Shares Held Minor Children Names Experie the Company and Other Companies Supervisors with
b of Date r Election Current Shares Shares Held nces Spousal or Second-Degree Relative
Registrati m Held (Educati Relationships
t on o Number of Shareho Number of Share Numb Share Numb Share on) and
i f Shares lding Shares holdi er of holdi er of holdi Backgro
t O Ratio % ng Share ng Share ng und
l f Ratio s Ratio s Ratio Company Positions in Other Relation
Job Title Name
e f % % % Positions Companies ship
i
c
e
Republic Juiye 2025.05.29 3 1996.10.16 42,788,288 25.73 42,788,288 25.73 Not Not Not Not Not Not applicable Not applicable Not Not Not
C of China. Enter applic applic applic appli applicab applicable applicab applicabl
h
prise able able able cabl le le e
a Co., e
i Ltd.
rma of China. Republic Lin, Weng 61~ 70 Male 2025.05.29 3 1996.10.16 0 0 0 0 0 0 0 0 College degree Chairman and General Chairman, Juiye Enterprise Co., Director I-Chin Lin, Father and
n -Teng years Manager Ltd. daughter
old. (Note2)
Republic Juiye . 2025.05.29 3 1996.10.16 42,788,288 25.73 42,788,288 25.73 Not Not a Not Not Not Not applicable Not applicable Not Not Not
of China.. Enter applic pplica applic appli applicab applicable applicab applicabl
prise able ble able cabl le le e
Co., e
D Ltd.
i
Republic Repre Female 2025.05.29 3 2016.06.28 0 0 0 0 0 0 0 0 Master's Director Chairman, Director Lin, Father
r
of China. sentat 31~ 40 Degree Bigwig Perfect Weng-T and
e ive: years International Co., eng daughter
c Lin, old Ltd.
t
I-Chi
o
n
r
Republic Repre Male 2025.05.29 2 2020.09.14 0 0 0 0 0 0 0 0 Universi Director General Manager None Lin, Spouse
of China. sentat 31~ 40 ty of RECTRON I-Chin
ive: years degree ELECTRONIC
Pan, old. ENTERPRISES,
Hsin- INC
Jen
----- End of picture text -----

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----- Start of picture text -----

Republic Repre Female 2025.05.29 3 2010.06.25 0 0 0 0 0 0 0 0 Universi Deputy General Chairman, None None None
of China. sentat 51~60 ty Manager and Chu-Ting
ive: years degree General Enterprise Co.,
Lin, old. Manager of the Ltd..
Jui-Pi Electronic
Business
ng
Division
Republic Repre Male 2025.05.29 3 2025.01.01 0 0 0 0 0 0 0 0 Universi General None None None None
of China. sentat 61~ 70 ty Manager of the
ive: years degree Electronics
old. Business
Liu
Division
Nien-
Fu
Republic Lin, Male 2025.05.29 3 2016.06.28 0 0 0 0 0 0 0 0 Universi None None None None None
of China. Ruey- 61~ 70 ty
Tou years degree
old.
I
Republic Maa, Male 2025.05.29 3 2021.08.30 0 0 0 0 0 0 0 0 Master's None Wisdom Marine None None None
n of China. Kwo- 61~ 70 Degree Group
d
Juh years Independent
e old. Director
p Independent
e Director
n
d Pontens
e Semiconductor
n co.,Ltd.
t Independent
Director
Independent
D Director
i
Chih Yeh
r Consultancy
e Limited CEO.
c
t Republic of Lee, Male 2025.05.29 3 2022.06.23 0 0 0 0 0 0 0 0 University None Deputy General None None None
o China Shiue-C 41~ 50 degree Manager of Fulai
r hen years old. Construction Co.,
Ltd.
Republic of Chang, Female 2025.05.29 3 2023.06.16 0 0 0 0 0 0 0 0 College None TAIWAN None None None
China Chia- 71~ 80 degree TSENG-CHOW
Jung years old. ENGINEERING
CO.,LTD.
Financial Manager
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Note 1: Representatives of Juiye Enterprise Co., Ltd.: Lin, Weng-Teng Lin, I-Chin, Pan, Hsin-Jen, Lin, Jui-Ping, Liu Nien-Fu.

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Note 2: The Chairman and the General Manager of the Company are the same person. The Company has increased the number of independent directors.

Table 1: Major shareholders of corporate shareholders

2.
Name of Corporate Shareholder Major Shareholders of Corporate
S
h
a
r
e
h
o
l
d
e
r
s
Juiye Enterprise Co., Ltd. LIN, WENG-TENG (75%), LIN, I-CHIN (25%)
Bigwig Perfect International Co., Ltd. LIN, I-CHIN (98.27%)
Conditions
Name
Professional Qualifications and
Experience
Independence status
Number of other
public corporations
in which the person
concurrently serves
as an independent
director.
Juiye Enterprise Co., Ltd.
Representative: LIN,
WENG-TENG
Chairman and GeneralManager
of RECTRON LTD.
Holding the position of General Manager of the company while having the
status of a manager.
The remaining individuals have been verified against the independence
criteria listed in the "Regulations Governing the Appointment of Independent
Directors of Publicly Issued Companies and Related Compliance Matters"
issued by the Financial Supervisory Commission, and still meet the relevant
independence requirements.
None
Juiye Enterprise Co., Ltd.
Representative: LIN,
I-CHIN		 Chairman of RECTRON LTD. The remaining individuals have been verified against the independence
criteria listed in the "Regulations Governing the Appointment of Independent
Directors of Publicly Issued Companies and Related Compliance Matters"
issued by the Financial Supervisory Commission, and still meet the relevant
independence requirements.		 None
  1. Disclosure of Directors' and Supervisors' Professional Qualifications and Independence of Independent Directors:

~ 8 ~

Conditions
Name
Professional Qualifications and
Experience
Independence status
Number of other
public corporations
in which the person
concurrently serves
as anindependent
director.		 Conditions
Name
Professional Qualifications and
Experience
Independence status
Number of other
public corporations
in which the person
concurrently serves
as anindependent
director.		 Conditions
Name
Professional Qualifications and
Experience
Independence status
Number of other
public corporations
in which the person
concurrently serves
as anindependent
director.		 Conditions
Name
Professional Qualifications and
Experience
Independence status
Number of other
public corporations
in which the person
concurrently serves
as anindependent
director.
Juiye Enterprise Co., Ltd.
Representative: PAN,
HSIN-JEN
General Manager of RECTRON
ELECTRONIC
ENTERPRISES, INC
The remaining individuals have been verified against the independence
criteria listed in the "Regulations Governing the Appointment of Independent
Directors of Publicly Issued Companies and Related Compliance Matters"
issued by the Financial Supervisory Commission, and still meet the relevant
independence requirements.
None
Juiye Enterprise Co., Ltd.
Representative: LIN,
JUI-PING
Audit Manager at KPMG
United Accounting Firm.
General Manager of the
Electronic Business Division
and Deputy General Manager of
the General Management
Department at RECTRON LTD.
The remaining individuals have been verified against the independence
criteria listed in the "Regulations Governing the Appointment of Independent
Directors of Publicly Issued Companies and Related Compliance Matters"
issued by the Financial Supervisory Commission, and still meet the relevant
independence requirements.
None
Juiye Enterprise Co., Ltd.
Representative: LIU,
NIEN-FU		 General Manager of the
Electronics Business Division of
RECTRON
The remaining individuals have been verified against the independence
criteria listed in the "Regulations Governing the Appointment of Independent
Directors of Publicly Issued Companies and Related Compliance Matters"
issued by the Financial Supervisory Commission, and still meet the relevant
independence requirements.		 None

~ 9 ~

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Conditions Number of other
public corporations
Name Professional Qualifications and in which the person
Independence status
Experience concurrently serves
as an independent
director.
----- End of picture text -----

LIN, RUEY-TOU Bachelor's Degree in Business
Administration from Tamkang
University.
Honorary Consultant to the
Legislative Yuan
Municipal Consultant to the
Taipei City Council
Municipal Consultant to the
Taipei City Government		 The company follows the provisions of the "Regulations Governing the
Appointment and Compliance Matters of Independent Directors of Public
Companies" in its establishment.
In addition to obtaining a declaration from the independent director, the
company has also reviewed the company's employee system, the director's
own holdings, holdings by spouse and relatives within the second degree of
kinship, the list of directors of affiliated companies, and examined the
shareholder registry and financial systems of the company and its affiliated
companies for the past two years to verify the absence of the aforementioned
situations.
The company has conducted searches on the Judicial Yuan's Legal
Information Retrieval System, Taiwan Bills Finance Corporation, etc., and
found no circumstances falling under Article 30 of the Company Act.
Based on the audit results, the company confirms that the independent
director meets the independence criteria.		 None

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----- Start of picture text -----

Conditions Number of other
public corporations
Name Professional Qualifications and in which the person
Independence status
Experience concurrently serves
as an independent
director.
----- End of picture text -----

Name Professional Qualifications and
Experience		 Independence status in which the person
concurrently serves
as anindependent
director.
MAA ,KWO-JUH Master's Degree in Accounting,
National Chengchi University.
Certified Public Accountant of
the Republic of China.
KPMG Chief Consultant
Chairman and CEO of KPMG
Taiwan. President of the
Professional Association of
Corporate Governance.
Adjunct Professor at the
Department of Law, National
Chengchi University.
Adjunct Professor at the
Department of Law, National
Taiwan University.
Wisdom Marine Group
Independent Director
Independent Director
Pontens Semiconductor co.,Ltd.
Independent Director
Independent Director
Chih Yeh Consultancy Limited
CEO.		 The company follows the provisions of the "Regulations Governing the
Appointment and Compliance Matters of Independent Directors of Public
Companies" in its establishment.
In addition to obtaining a declaration from the independent director, the
company has also reviewed the company's employee system, the director's
own holdings, holdings by spouse and relatives within the second degree of
kinship, the list of directors of affiliated companies, and examined the
shareholder registry and financial systems of the company and its affiliated
companies for the past two years to verify the absence of the aforementioned
situations.
The company has conducted searches on the Judicial Yuan's Legal
Information Retrieval System, Taiwan Bills Finance Corporation, etc., and
found no circumstances falling under Article 30 of the Company Act.
Based on the audit results, the company confirms that the independent
director meets the independence criteria.		 2 companies

~ 11 ~

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----- Start of picture text -----

Conditions Number of other
Professional Qualifications and Independence status public corporations
Name Experience in which the person
concurrently serves
as an independent
director.
----- End of picture text -----

Name Professional Qualifications and
Experience
Independence status		 public corporations
in which the person
concurrently serves
as an independent
director.
LEE, SHIUE-CHEN Audit Manager at KPMG
United Accounting Firm,
Finance.
Finance and Accounting
Manager at Hung Kuo Group.
Deputy General Manager of
Fulai Construction Co., Ltd.		 The company follows the provisions of the "Regulations Governing the
Appointment and Compliance Matters ofIndependent Directors of Public
Companies" in its establishment.
In addition to obtaining a declaration from the independent director, the
company has also reviewed the company's employee system, the director's
own holdings, holdings by spouse and relatives within the second degree of
kinship, the list of directors of affiliated companies, and examined the
shareholder registry and financial systems of the company and its affiliated
companies for the past two years to verify the absence of the aforementioned
situations.
The company has conducted searches on the Judicial Yuan's Legal
Information Retrieval System, Taiwan Bills Finance Corporation, etc., and
found no circumstances falling under Article 30 of the Company Act.
Based on the audit results, the company confirms that the independent
director meets the independence criteria.









None

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----- Start of picture text -----

Conditions Number of other
public corporations
Professional Qualifications and in which the person
Independence status
Experience concurrently serves
Name as an independent
director.
----- End of picture text -----

Name Professional Qualifications and
Experience		 Independence status in which the person
concurrently serves
as an independent
director.
CHANG, CHIA- JUNG Graduated from Ming Chuan
Women's College of Commerce
Taiwan Tseng-Chow
Engineering CO.,LTD.
Financial Manager		 The company follows the provisions of the "Regulations Governing the
Appointment and Compliance Matters of Independent Directors of Public
Companies" in its establishment.
In addition to obtaining a declaration from the independent director, the
company has also reviewed the company's employee system, the director's
own holdings, holdings by spouse and relatives within the second degree of
kinship, the list of directors of affiliated companies, and examined the
shareholder registry and financial systems of the company and its affiliated
companies for the past two years to verify the absence of the aforementioned
situations.
The company has conducted searches on the Judicial Yuan's Legal
Information Retrieval System, Taiwan Bills Finance Corporation, etc., and
found no circumstances falling under Article 30 of the Company Act.
Based on the audit results, the company confirms that the independent
director meets the independence criteria.		 None

Note 1: Professional qualifications and experience: Describe the professional qualifications and experience of individual directors and supervisors, and if they are members of the audit committee with accounting or financial expertise, their accounting or financial background and work experience should be stated. Also, indicate whether there are any circumstances under Article 30 of the Company Act.

Note 2: Independent directors should state their independence status, including but not limited to whether they or their spouses, parents, or children within the second degree of kinship serve as directors, supervisors, or employees of the Company or its affiliates; whether they or their spouses, parents, or children within the second degree of kinship hold shares of the Company or its affiliates or utilize others' names to hold such shares; whether they serve as directors, supervisors, or employees of related parties of the Company as referred to in Article 3, Paragraph 1, Subparagraphs 5 to 8 of the Regulations Governing the Appointment of Independent Directors and Compliance Matters for Public Companies; and the amount of compensation received in the past two years for providing business, legal, financial, accounting or other services to the Company or its affiliates.

3. Board Diversity and Independence:

(1) Board Diversity:

The company advocates and respects a policy of board diversity to enhance corporate governance and promote the sound development of the board's composition and structure. We believe that a diverse board can contribute to the overall performance of the company. The selection of board members is based on the principle of selecting individuals with diverse and complementary capabilities across industries. This includes basic diversity factors such as age, gender, and nationality, as well as industry experience and relevant skills in areas such as finance, accounting, legal, information technology, and public utilities. Additionally, board members possess abilities in business judgment, management, leadership decision-making, and crisis handling. Article 20 of the "Corporate Governance Practices Guidelines"

~ 13 ~

states that the board as a whole should possess the following abilities to strengthen its functions and achieve the ideal goals of corporate governance: 1. Operational judgment ability. 2. Accounting and financial analysis ability. 3. Business management ability. 4. Crisis handling ability. 5. Industry knowledge. 6. International market perspective. 7. Leadership ability. 8. Decision-making ability.

The current status of the company's policy and implementation of diversified board members are as follows:

==> picture [671 x 397] intentionally omitted <==

----- Start of picture text -----

Basic Composition Industry Experience Professional Abilities Number of other public
Conditions
Independent Profes corporations in which the
Age
Director Tenure sional Archite Busin Inform person concurrently serves
Have Financi
31 41 51 61 71 Servic cture ess ation Acco Risk as an independent director.
Nationa Gende emplo 3 3 6 al Engin
to to to to to es and and and Legal untin Manag
lity r yee years to Year and eering
40 50 60 70 80 and Engine Suppl Techno g ement
status or 6 or Finance
years years years years years Marke ering y logy
Name less years more
old old old old old ting
Taiwan
Chairman LIN, WENG-TENG Male          None
R.O.C.
Taiwan
Director LIN I-CHIN Female        None
R.O.C.
Taiwan
Director PAN,HSIN-JEN Male         None
R.O.C.
Taiwan
Director LIN, JUI-PING Female        None
R.O.C.
Taiwan
Director LIU, NIEN-FU Male      None
R.O.C
Independent Director LIN, Taiwan
Male         None
RUEY-TOU R.O.C.
Independent Director Taiwan
Male          2Companies
MAA ,KWO-JUH R.O.C.
Independent Director LEE, Taiwan
Male          None
SHIUE-CHEN R.O.C.
Independent Director CHANG, Taiwan
Female       None
CHIA- JUNG R.O.C.
----- End of picture text -----

The 20th Board of Directors of the company consists of 9 directors, including 4 independent directors. They possess the overall abilities of business judgment, leadership decision-making, operational management, international market perspective, and crisis handling. They have industry experience and professional

~ 14 ~

expertise. One independent director has accounting and financial expertise with practical experience in practice, management, or teaching. The average tenure of the company's directors is 9 years. All directors are nationals of the company. The composition structure includes 4 independent directors, accounting for 44.4%, and 5 directors with employee status, accounting for 55.6%. The age distribution of the directors includes 2 directors in the age range of 31-40, 1 director in the age range of 41-50,1 director in the age range of 51-60, 4 directors in the age range of 61-70, and 1 director in the age range of 71-80. In addition to the above, the company also emphasizes gender equality in the composition of the board. The current board includes 3 female members, accounting for a high percentage of 33.3% female directors. The company will continue to strive to increase the percentage of female directors in the future. The diversity, complementarity, and implementation of the board have already included and complied with the standards specified in Article 20 of the "Corporate Governance Best Practice Principles." In the future, the company will timely revise and enhance the diversity policy based on the operation of the board, operational requirements, and development needs. This includes but is not limited to the standards related to basic qualifications and values, professional knowledge, and skills, to ensure that board members possess the necessary knowledge, skills, and qualities for executing their duties. (2) Board Independence:

The independent directors of the Company have served an average tenure of more than five years. Among them, one independent director has served for more than 3 terms consecutively. This is due to their financial expertise, familiarity with relevant laws and regulations, and specialized experience in corporate governance, which significantly benefits the company. Despite their extended tenure, they are still able to utilize their expertise and provide professional opinions for the supervision of the board. The tenure of other independent directors does not exceed 3 terms.

  • (3) Compliance with Securities and Exchange Act:

There are no circumstances within the meaning of Article 26(3) and (4) of the Securities and Exchange Act, including situations where there are spousal or close relatives relationships between directors, supervisors, or between directors and supervisors. None of the directors or independent directors of the company have relationships that fall within the provisions of Article 26(3) and (4) of the Securities and Exchange Act. The number of directors with spousal or close relatives’ relationships within the company does not exceed half of the total seats.

~ 15 ~

4. General Manager, Deputy General Manager, Assistant Managers, and Head of Departments and Branch Offices:

March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026 March31,2026
Job title
Nationa
lity
Name
G
en
de
r
Date of
appointment		 Shareholdings
Shares
Shareholdings
held by
spouse and minor
children
Holding shares under
another person's name Primary professional
(educational)
background
Current
positionsheld
by managers
with spousal or close
relatives
relationships in other
companies
Remarks
Numbe
r of
Shares
Shareh
olding
Ratio %
Numbe
r of
Shares
Sharehold
ing Ratio
%
Number
of Shares
Shareholdi
ng Ratio %
Job
Title
Name Relatio
nship
General
Manager
Deputy
General
Manager and
General
Deputy
General
Manager of
the Electronic
Division
Director of
the Electronic
Business
Division.		 Taiwan
R.O.C.
Taiwan
R.O.C.
Taiwan
R.O.C.
Taiwan
R.O.C.		 Lin,
Weng-Te
ng
Lin,
Jui-Ping
Liu,
Nien-Fu
Lin
Shi-jie		 Ma
le
Fe
ma
le
Ma
le
Ma
le		 2025.11.13
2020.09.14
2024.01.10
2014.05.01		 -
-
-
-		 -
-
-
-		 -
-
-
-		 -
-
-
-		 -
-
-
-		 -
-
-
-		 College degree/Chairman of
RECTRON LTD.
University degree/Audit
Manager at KGMP United
Accounting Firm.
Deputy General Manager
of Sales
Chief Engineer of Taiwan
Semiconductor
Corporation.

Chairman, Juiye
Enterprise Co.,
Ltd.
Chairman,
Chu-Ting
Enterprise Co.,
Ltd..
-
-		 -
-
-
-		 -
-
-
-		 -
-
-
-		 Note
-
-
-

Note: When the Chairman of the Board and the General Manager hold the highest managerial positions and are spouses or close relatives, the reasons, justifications, necessity, and corresponding measures should be disclosed (such as increasing the number of independent director seats and ensuring that a majority of directors do not hold positions as employees or managers, etc.) along with relevant information.

The Chairman of the Board in our company also serves as the General Manager to enhance operational efficiency and decision-making execution. In order to strengthen the independence of the Board of Directors, appropriate candidates have been actively trained internally. Additionally, the Chairman closely communicates with the directors to fully understand the company's operational status and plans, and implements corporate governance initiatives. In the future, the company plans to increase the number of independent director seats to enhance the capabilities of the Board and strengthen its oversight functions. Currently, the following specific measures have been implemented:

  1. Independent directors in the company possess expertise in business, law, finance, accounting, or necessary knowledge related to company operations to effectively fulfill their supervisory roles.

~ 16 ~

  1. Directors are arranged to attend professional director courses provided by external organizations such as the Securities and Futures Institute to enhance the effectiveness of the Board's operations.

  2. Independent directors participate in functional committees, engage in comprehensive discussions, and provide recommendations for the Board's reference. They also communicate with the accountants and internal auditors to ensure effective corporate governance.

~ 17 ~

5. Remuneration for general directors and independent directors (individual names and remuneration methods disclosed separately)

December 31, 2025 Unit: NT$1,000

==> picture [718 x 441] intentionally omitted <==

----- Start of picture text -----

The total amount and
Director remuneration Percentage of Total Net Remuneration Paid to Part-Time Employees proportion of A, B, C, D,
Profit After Tax of A, B, E, F, and G, as well as
C, and D their respective
Remuneration (A) Retirement and sevpay (B) Compensation Director (C) Business executionExpenses (D) After-tax net profit of NT$ 81,873 thousand Salary, Bonuses, and Other Allowances Retirement and sevpay (F) Employee Compensation (G) percentages of net income After-tax net profit of after tax. CompensatioDirectors by n Paid to
(Note 3) (E) NT$1 81,873 thousand a Re-Invested
Job
Title Name Company
All companies in Other than
ThempCo financial companies in the All CompanThe y financial companies in the All CompanThe y financial companies in the All CompTheany companies financial in the All CompanyThe companies in the financial All CompTheany companies in the financial All CompTheany companies in the financial All divideCash The Company dividend Stock dividethe financial reportCash Stock CompanyThe Companies in Consolidated financial the Company’s Subsidiarythe
any report report report report report report report nd amount nd dividend statements
amou Stock Amou amount
nt Amount nt
Corpo
rate Juiye 0 0 0 0
Direct Enterprise 0 0 0 0 0 0 0 0 0% 0% 0 0 0 0 0 0 0 0 0% 0% None
or Co., Ltd.
Juiye
Enterprise
Chair Co., Ltd. 0 0 0 0 550 550 0 0 550 550 197 3,561 0 0 0 0 0 0 747 4,111 None
man Representativ 0.67% 0.67% 0.91% 5.02%
e: Lin,
Weng-Teng
Juiye
Direct Enterprise 550 550 1,876 3,698
Co., Ltd. 0 0 0 0 550 550 0 0 3,148 0 0 0 0 0 0 None
or 067% 0.67% [1,326] 2.29% 4.52%
Representativ
e: Lin, I-Chin
Juiye
Enterprise
Direct Co., Ltd. 0 0 0 0 550 550 0 0 550 550 154 3,592 10 12 0 0 0 0 714 4,154 None
or Representativ 0.67% 0.67% 0.87% 5.07%
e:
Pan,Hsin-Jen
Juiye
Enterprise
Direct Co., Ltd. 0 0 0 0 550 550 0 0 550 550 2,030 95 95 0 0 0 0 2,109 2,675 None
or Representativ 0.67% 0.67% [1,464] 2.58% 3.27%
e: Lin,
Jui-Ping
Juiye
Enterprise
Direct Co., Ltd. 0 0 0 0 0 0 0 0 0 0 3,214 78 78 0 0 0 0 1,465 3,292 None
or Representativ 0% 0% [1,386] 1.79% 4.02%
e: Liu,
Nien-Fu
Independent Lin, 600 600 0 0 0 0 0 0 600 600 0 0 0 0 0 0 0 0 600 600 None
Director Ruey-Tou 0.73% 0.73% 0.73% 0.73%
----- End of picture text -----

~ 18 ~

Indepen
dent
Director
Maa,
Kwo-Juh
600
600
0
0
0
0
0
0
600
0.73%
600
0.73%
0
0
0
0
0
0
0
0
600
0.73%
600
0.73%
None
Indepen
dent
Director
Lee,
Shiue-Chen
120
600
0
0
0
0
0
0
120
0.15%
120
0.15%
0
0
0
0
0
0
0
0
120
0.15%
120
0.15%
None
Indepen
dent
Director
Chang, Chia-
Jung
120
120
0
0
0
0
0
0
120
0.15%
120
0.15%
0
0
0
0
0
0
0
0
120
0.15%
120
0.15%
None
1. Please specify the policy, system, standards, and structure of independent director remuneration and describe the correlation between the remuneration amount and factors such as responsibilities,
risks, and time commitment: The remuneration for independent directors in our company is determined based on the results of the "Board of Directors' Performance Evaluation" and the
provisions of the "Remuneration and Compensation Committee Organizational Regulations." It takes into account individual responsibilities, time commitment, as well as the individual's
performance achievements and contributions as an independent director to provide reasonable compensation. The standards and structure of remuneration for independent directors are submitted
to the Board of Directors for approval after being reviewed and approved by the Compensation Committee.
2. Apart from the disclosure in the table above, in the most recent fiscal year, directors of the company received remuneration for services provided (such as serving as consultants to the parent
company, all companies within the financial reports, or non-employee advisors to investee businesses): There is no such case.

6. Remuneration for supervisors (individual names and remuneration methods)

On June 23, 2022, the company established an Audit Committee to replace the role of the supervisor. Therefore, the relevant disclosure of the supervisor's remuneration is no longer applicable from that date.

~ 19 ~

7. Remuneration for the General Manager and Deputy General Manager (Individual disclosure of names and remuneration methods)

December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None		 December 31, 2025
Unit: NTD inthousands
Employee Compensation Amount (D)
Percentage of Total
Net Profit After Tax of
A, B, C, and D（％）
Compensatio
n Paid to
Directors by a
Re-Invested
Company
Other than the
Company’s
Subsidiary
The Company
All companies in the
financial report
The
Company
All
companie
s in the
financial
report
Cash
dividen
d
amount
Stock
dividend
Amount
Cash
dividend
amount
Stock
dividend
Amount
0
0
0
0
197
0.24%
3,561
4.35%
None
0
0
0
0
1,559
1.90%
2,125
2.60%
None
0
0
0
0
1,464
1.79%
3,292
4.02%
None
Job Title
Name		 Salary (A)
Retirement benefits (B)
Bonuses and
Special Expenses (C)
The
Compa
ny
All
companies in
the financial
report
The
Compa
ny
All
companies in
the financial
report
The
Compa
ny
All
companies in
the financial
report
General
Manager
Lin,
Weng-
Teng		 197
3,561
0
0
0
0		 0
0
0
0
197
0.24%
3,561
4.35%
None
Deputy
General
Manager and
General
Manager
of
the Electronic
Business
Division
Lin,
Jui-Pin
g		 1,464
2,030
95
95
0
800		 0
0
0
0
1,559
1.90%
2,125
2.60%
None
General
Manager
of
the Electronic
Division		 Liu,
Nien-F
u		 1,386 3,214 78 78 0 0 0 0 0 0 1,464
1.79%		 3,292
4.02%		 None

~ 20 ~

  1. Remuneration for the top five highest-paid executives (Individual disclosure of names and remuneration methods)

==> picture [598 x 375] intentionally omitted <==

----- Start of picture text -----

A, B, C, and D, the
total amount and the Compensation
Salary (A) Bonuses and Employee Compensation Amount (D) proportion (in Paid to
Retirement benefits (B) Special Expenses (C) percentage) to the net
income after tax of Directors by a
125,531 thousand NTD
are as follows: Re-Invested
Job Title Name
Company
All All All All companies in All
The companies The companies The companies The Company the financial report The companies Other than the
Company in the financial Company in the financial Company in the financial (Note 5) Company in the financial Company’s
Cash Stocks Cash Stocks
report report report Amount Amount Amount Amount report Subsidiary
General
Manager of a Pan, 154 3,592 10 12 0 0 0 0 0 0 164 3,604 None
Hsin-Jen 0.20% 4.40%
Subsidiary
General
Manager Lin, 197 3,561 0 0 0 0 0 0 0 0 197 3,561 None
Weng-Teng 0.24% 4.35%
General
Manager of
the Electronic Liu, 1,386 3,214 78 78 0 0 0 0 0 0 1,4641.79% 3,2924.02% None
Division Nien-Fu
General
Manager
1,326 3,148
of a Lin, I-Chin 1,326 3,148 0 0 0 0 0 0 0 0 None
1.62% 3.84%
Subsidiary
Deputy
General
Manager Lin, 1,464 2,030 95 95 0 0 0 0 0 0 1,559 2,125 None
and Jui-Ping 1.90% 2.60%
General
Manager
----- End of picture text -----

~ 21 ~

  1. The names of managers involved in distributing employee compensation and the distribution details are as follows

The names of managers involved in distributing employee compensation and the distribution details are as follows

December 31, 2025
Unit: NTD in thousands
The proportion (%) of the
total amount to the net
income after tax.
0%
Job title Name Stock Amount Cash amount Total The proportion (%) of the
total amount to the net
income after tax.
M
a		 General Manager Lin, Weng-Teng
n
a
g
e
r		 Deputy General Manager
and General Manager of the
Electronic Business
Division
Lin, Jui-Ping		 0 0 0
General Manager of the
Electronic Division		 Liu,Nien-Fu

~ 22 ~

  1. Analysis and explanation of the proportion of total remuneration to net income after tax for directors, supervisors, general manager, and deputy general manager paid by the company and all consolidated companies in the past two fiscal years, including the policies, standards, composition, procedures for determining remuneration, and their correlation with business performance.

==> picture [672 x 195] intentionally omitted <==

----- Start of picture text -----

Proportion of total Proportion of total remuneration Proportion of total Proportion of total remuneration
remuneration to net income to net income after tax for remuneration to net income to net income after tax for
after tax for directors, directors, supervisors, general after tax for directors, directors, supervisors, general
supervisors, general manager, manager, and deputy general supervisors, general manager, and deputy general
Job Title
and deputy general manager manager paid by all consolidated manager, and deputy manager paid by all consolidated
paid by the company in 2024. companies in the company's general manager paid by the companies in the company's
2024 consolidated financial company in 2024.. 2025 consolidated financial
statements. statements.
Director 6.15% 18.10% 10.20% 23.66%
General Manager and
3.08% 8.41% 3.93% 10.97%
Vice General Manager
----- End of picture text -----

The procedure for remuneration payment is closely associated with operational performance and future risks.

The remuneration paid to directors of the Company is determined based on the percentages and scope stipulated in the Company's Articles of Incorporation. In years of profitability, an allocation of not less than 1% shall be provided for employee compensation and not more than 2% for director remuneration. If the company has accumulated losses from previous years and makes a profit in the current year, it should first make up for the losses before allocating employee and director remuneration, and the remaining balance should be allocated according to the aforementioned ratio. In the event of accumulated losses from previous years, any profits in the current year must first be used to offset the losses before allocating funds for employee compensation and director remuneration, with the remaining balance allocated according to the aforementioned proportions. The distribution of employee and director remuneration should be resolved by the board of directors and reported to the shareholders' meeting.

The salary and compensation paid by the company include cash compensation, retirement benefits, various allowances, and other measures with substantial incentives. The scope is consistent with the requirements for disclosure in the annual report of publicly traded companies regarding director, supervisor, and manager remuneration. To establish a sound salary and compensation system for the company's directors, supervisors, and managers, the company has established a salary and compensation committee and formulated the "Salary and Compensation Committee Organization Regulations." The

~ 23 ~

Compensation Committee, in accordance with the aforementioned regulations, evaluates the Company's remuneration policies and systems for directors, supervisors, and managers from a professional and objective standpoint. It periodically reviews the performance evaluation of directors, supervisors, and managers, as well as the policies, systems, standards, and structures of remuneration. During the review process by the Compensation Committee, the remuneration should be based on the continued assessment of directors, supervisors, and managers and reference the usual industry standards, taking into account individual performance, the Company's ongoing performance, and the rationality of future risk linkage.

The remuneration of executives in the Company is determined by the Chairman of the Board, authorized by the Board of Directors, taking into account the nature of their work, responsibilities, as well as factors such as education, experience, skills, and potential development. The policies, standards, composition, and procedures for remuneration, as well as their relationship with business performance and future risks, are established in accordance with the Company's "Articles of Incorporation" and relevant management regulations.

In summary, the policies, standards, procedures for determining remuneration, and their relationship with business performance and future risks in the Company are all carried out in accordance with the provisions of the Company's "Articles of Incorporation" and relevant "Management Regulations."

~ 24 ~

2. Corporate Governance Practices

（ 1 ） Board of Directors operation situation

The Board of Directors held 8 meetings (A) during the recent fiscal year, ending on March 31, 2026. The attendance record of directors and supervisors is as follows:

==> picture [716 x 376] intentionally omitted <==

----- Start of picture text -----

Actual attendance (B) Delegated attendance count Actual attendance rate (%)
Job Title Name remarks
[B/A]
Juiye Enterprise Co., Ltd.
Chairman 7 0 87.5%
Representative: Lin, Weng-Teng
Juiye Enterprise Co., Ltd.
Director 8 0 100%
Representative: Lin, I-Chin
Juiye Enterprise Co., Ltd.
Director 8 0 100%
Representative: Pan, Hsin-Jen
Juiye Enterprise Co., Ltd.
Director 8 0 100%
Representative: Lin, Jui-Ping
Juiye Enterprise Co., Ltd.
Director 8 0 100%
Representative: Liu,Nien-Fu
Independent
Lin, Ruey-Tou 8 0 100%
Director
Independent
Maa, Kwo-Juh 8 0 100%
Director
Independent
Lee, Shiue-Chen 8 0 100%
Director
Independent
Chang, Chia- Jing 8 0 100%
Director
Other items that shall be recorded:
1. If any of the following circumstances occur in the operation of the board of directors, the date, term, agenda, opinions of all independent directors and the
company's handling of independent directors' opinions should be described:
----- End of picture text -----

~ 25 ~

==> picture [716 x 467] intentionally omitted <==

----- Start of picture text -----

1. Matters stipulated in Article 14-3 of the Securities and Exchange Act:
All independent directors and the
Meeting date Important decisions of the Board of Directors company's handling of independent
directors' opinions
19th session 1.The Company's declaration on internal control system for the year Independent Director's opinion:
19th time 2024. None.
2025.3.11 2.Proposal for the appointment of Certified Public Accountants. Company's handling of independent
3.Proposal for Participation in the Capital Increase of the director's opinion: None.
Investment Subsidiary Chu-Ting Enterprise Co., Ltd. Resolution: Approved by all
4.Proposal for the amendment to the Company's "Procedures for attending directors
Lending Funds to Other Parties.”
5.Proposal for the 2024 Profit Distribution.
19th session 1.Proposal for the Company's Q1 2025 Financial Statements.
20th time
2025.5.14
20th session 1.Proposal for the Company's Q2 2025 Financial Statements.
2th time 2.Proposal for the Company's 100% investment in Shanghai
2025.8.14 Lizhengda Industrial Co., Ltd.
20th session 1.Proposal for the Company's Q3 2025 Financial Statements.
3th time 2.Proposal for the appointment and dismissal of the General
2025.11.13 Manager.
20th session 1.Proposal for the Revise the "Internal Control System" and
4th time "Internal Audit Implementation Rules"
2025.12.16
----- End of picture text -----

~ 26 ~

2.
3.		 20th session
5th time
2026.3.11
1.Proposal for the Company's 2025 Business Report and Financial
Statements.
2.The Company's declaration on internal control system for the year
2025.
3.Proposal for the appointment of Certified Public Accountants.
4.Proposal for the 2025 Profit Distribution.
(2) Other board resolutions that were opposed or had reservations from independent directors with recorded or written statements, besides the
aforementioned items: None.
Members who recused themselves from voting on matters related to conflicts of interest shall state their names, the content of the resolution, the reasons
for recusal, and their voting participation:
1. During the 20th board meeting of the 3th term held on November 13, 2025, when setting the Directors’ remuneration distribution in 2024, directors Lin
I-Chin, Lin Weng-Teng, Pan Hsin-Jen, Lin Jui-Ping abstained from voting due to their status as interested parties in the matter.
2. During the 20th board meeting of the 3th term held on November 13, 2025, when determining the appointment and dismissal of the General Manager
directors Lin, Weng-Teng abstained from voting due to his status as interested parties in the matter.
Implementationof BoardEvaluation:
Evaluation
Period
Evaluation Period
Evaluation
Scope
Evaluation
Method
Evaluation Content
Conducted
annually
From January 1,
2025
to December 31,
2025
Overall Board,
Individual
Directors,
Compensation
Committee
Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees
(1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree		 20th session
5th time
2026.3.11
1.Proposal for the Company's 2025 Business Report and Financial
Statements.
2.The Company's declaration on internal control system for the year
2025.
3.Proposal for the appointment of Certified Public Accountants.
4.Proposal for the 2025 Profit Distribution.
(2) Other board resolutions that were opposed or had reservations from independent directors with recorded or written statements, besides the
aforementioned items: None.
Members who recused themselves from voting on matters related to conflicts of interest shall state their names, the content of the resolution, the reasons
for recusal, and their voting participation:
1. During the 20th board meeting of the 3th term held on November 13, 2025, when setting the Directors’ remuneration distribution in 2024, directors Lin
I-Chin, Lin Weng-Teng, Pan Hsin-Jen, Lin Jui-Ping abstained from voting due to their status as interested parties in the matter.
2. During the 20th board meeting of the 3th term held on November 13, 2025, when determining the appointment and dismissal of the General Manager
directors Lin, Weng-Teng abstained from voting due to his status as interested parties in the matter.
Implementationof BoardEvaluation:
Evaluation
Period
Evaluation Period
Evaluation
Scope
Evaluation
Method
Evaluation Content
Conducted
annually
From January 1,
2025
to December 31,
2025
Overall Board,
Individual
Directors,
Compensation
Committee
Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees
(1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree		 20th session
5th time
2026.3.11
1.Proposal for the Company's 2025 Business Report and Financial
Statements.
2.The Company's declaration on internal control system for the year
2025.
3.Proposal for the appointment of Certified Public Accountants.
4.Proposal for the 2025 Profit Distribution.
(2) Other board resolutions that were opposed or had reservations from independent directors with recorded or written statements, besides the
aforementioned items: None.
Members who recused themselves from voting on matters related to conflicts of interest shall state their names, the content of the resolution, the reasons
for recusal, and their voting participation:
1. During the 20th board meeting of the 3th term held on November 13, 2025, when setting the Directors’ remuneration distribution in 2024, directors Lin
I-Chin, Lin Weng-Teng, Pan Hsin-Jen, Lin Jui-Ping abstained from voting due to their status as interested parties in the matter.
2. During the 20th board meeting of the 3th term held on November 13, 2025, when determining the appointment and dismissal of the General Manager
directors Lin, Weng-Teng abstained from voting due to his status as interested parties in the matter.
Implementationof BoardEvaluation:
Evaluation
Period
Evaluation Period
Evaluation
Scope
Evaluation
Method
Evaluation Content
Conducted
annually
From January 1,
2025
to December 31,
2025
Overall Board,
Individual
Directors,
Compensation
Committee
Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees
(1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree		 20th session
5th time
2026.3.11
1.Proposal for the Company's 2025 Business Report and Financial
Statements.
2.The Company's declaration on internal control system for the year
2025.
3.Proposal for the appointment of Certified Public Accountants.
4.Proposal for the 2025 Profit Distribution.
(2) Other board resolutions that were opposed or had reservations from independent directors with recorded or written statements, besides the
aforementioned items: None.
Members who recused themselves from voting on matters related to conflicts of interest shall state their names, the content of the resolution, the reasons
for recusal, and their voting participation:
1. During the 20th board meeting of the 3th term held on November 13, 2025, when setting the Directors’ remuneration distribution in 2024, directors Lin
I-Chin, Lin Weng-Teng, Pan Hsin-Jen, Lin Jui-Ping abstained from voting due to their status as interested parties in the matter.
2. During the 20th board meeting of the 3th term held on November 13, 2025, when determining the appointment and dismissal of the General Manager
directors Lin, Weng-Teng abstained from voting due to his status as interested parties in the matter.
Implementationof BoardEvaluation:
Evaluation
Period
Evaluation Period
Evaluation
Scope
Evaluation
Method
Evaluation Content
Conducted
annually
From January 1,
2025
to December 31,
2025
Overall Board,
Individual
Directors,
Compensation
Committee
Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees
(1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree		 20th session
5th time
2026.3.11
1.Proposal for the Company's 2025 Business Report and Financial
Statements.
2.The Company's declaration on internal control system for the year
2025.
3.Proposal for the appointment of Certified Public Accountants.
4.Proposal for the 2025 Profit Distribution.
(2) Other board resolutions that were opposed or had reservations from independent directors with recorded or written statements, besides the
aforementioned items: None.
Members who recused themselves from voting on matters related to conflicts of interest shall state their names, the content of the resolution, the reasons
for recusal, and their voting participation:
1. During the 20th board meeting of the 3th term held on November 13, 2025, when setting the Directors’ remuneration distribution in 2024, directors Lin
I-Chin, Lin Weng-Teng, Pan Hsin-Jen, Lin Jui-Ping abstained from voting due to their status as interested parties in the matter.
2. During the 20th board meeting of the 3th term held on November 13, 2025, when determining the appointment and dismissal of the General Manager
directors Lin, Weng-Teng abstained from voting due to his status as interested parties in the matter.
Implementationof BoardEvaluation:
Evaluation
Period
Evaluation Period
Evaluation
Scope
Evaluation
Method
Evaluation Content
Conducted
annually
From January 1,
2025
to December 31,
2025
Overall Board,
Individual
Directors,
Compensation
Committee
Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees
(1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree
Evaluation
Period		 Evaluation Period Evaluation
Scope		 Evaluation
Method		 Evaluation Content
Conducted
annually		 From January 1,
2025
to December 31,
2025		 Overall Board,
Individual
Directors,
Compensation
Committee		 Board
Self-Assessm
ent, Director
Self-Assessm
ent,
Functional
Committees		 (1) Board performance evaluation: at least includes the
degree of participation in company operations, quality
of board decision-making, board composition and
structure, selection and continuing education of
directors, internal control, etc.
(2) Individual director performance evaluation: at least
includes the grasp of company goals and missions,
recognition of director's duties, degree of participation
in
company
operations,
internal
relationship
management and communication, director's expertise
and continuing education, internal control, etc.
(3) Functional committeeperformance evaluation: degree

~ 27 ~

4. of participation in company operations, recognition of
functional committee duties, quality of functional
committee decision-making, composition and member
selection of functional committees,internal control,etc.
Note: On June 23, 2023, the company established an Audit Committee to replace the role of the supervisor. Therefore, the involvement of the
supervisor in the operation of the board is no longer applicable from that date.

~ 28 ~

Attendance of Independent Directors at Board Meetings from the most recent year to March 31, 2026

◎：indicatespersonal attendance ◎：indicatespersonal attendance ◎：indicatespersonal attendance ☆：indicates attendance by proxy*：indicates absence
November 13
December 16
March 5
March 11
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎		 ☆：indicates attendance by proxy*：indicates absence
November 13
December 16
March 5
March 11
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎		 ☆：indicates attendance by proxy*：indicates absence
November 13
December 16
March 5
March 11
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎		 ☆：indicates attendance by proxy*：indicates absence
November 13
December 16
March 5
March 11
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
◎
Independent
Director		 March 11 May 14 May 29 August 14 November 13 December 16 March 5 March 11
Lin, Ruey-Tou ◎ ◎ ◎ ◎ ◎ ◎ ◎ ◎
Maa,Kwo-Juh ◎ ◎ ◎ ◎ ◎ ◎ ◎ ◎
Lee,Shiue-Chen ◎ ◎ ◎ ◎ ◎ ◎ ◎ ◎
Chang,Chia-Jung ◎ ◎ ◎ ◎ ◎ ◎ ◎ ◎

Communication between Independent Directors, Internal Audit Manager, and Auditors (including significant matters, methods, and outcomes regarding the company's finances and business conditions):

  1. The company's internal audit department submits audit reports and audit tracking tables to the Independent Directors on a monthly and quarterly basis. In regular circumstances, communication between the internal audit manager and Independent Directors takes place through email, phone, or face-to-face meetings, as needed. Additionally, the internal audit department provides an annual audit business report to the Independent Directors, communicating the audit report results and the status of other tracking reports.

  2. The company's external auditors report to the Independent Directors at least once a year regarding key audit matters, financial statement reviews, or audit results for the company and its subsidiaries. They also engage in communication with the Independent Directors.

  3. Summary of communication between Independent Directors, Internal Audit Manager, and Auditors over the past year:

==> picture [432 x 120] intentionally omitted <==

----- Start of picture text -----

Date Communication with Internal Audit Director: Results
2025.03.11 Internal Audit Business Report for the year 2024. No special recommendations from
the independent directors.
2025.05.14 Internal Audit Business Report for the period No special recommendations from
from January 2025 to March 2025. the independent directors.
2025.08.14 Internal Audit Business Report for the period No special recommendations from
from April 2025 to June 2025. the independent directors.
2025.11.13 Internal Audit Business Report for the period No special recommendations from
from July 2025 to September 2025. the independent directors.
2025.12.16 Proposal for the 2026 Internal Audit Plan, and the No special recommendations from
----- End of picture text -----

~ 29 ~

amendments to the Company's "Internal Control the independent directors. System" and "Implementation Rules for Internal Audit."

(2) Audit Committee Operations:

Information on the operations of the Audit Committee

The Audit Committee held four meetings during the most recent fiscal year 6 ( Ａ ). The attendance of independent directors is as follows:

Job Title
Name		 Number of
attendance in
person(B)
Delegated
attendance count
Rate of attendance in person
(%)
(Ｂ/Ａ)(Note1, Note 2)		 Remarks
Independent
Director
Lin, Ruey-Tou		 6
0
100%
Independent
Director
Maa, Kwo-Juh		 6
0
100%
Independent
Director
Lee, Shiue-Chen		 6
0
100%
Independent
Director
Chang, Chia-Jung		 6
0
100%
Other items that shall be recorded:
1.In the event of any of the following circumstances regarding the operation of the Audit Committee, the date and session, agenda items,
dissenting opinions of independent directors, reservations or significant recommendations, decision results of the Audit Committee, and
the company's handling of the opinions of the Audit Committee shall be disclosed.
(1) Matters listed in Article 14-5 of the Securities and Exchange Act.

~ 30 ~

Meeting date
Significant Resolutions of the Audit Committee
Decision Results of the Audit
Committee and the Board
of Directors' handling of the opinions
of the Audit Committee
1st session,16nd
time
2025.3.11
1.Proposal for the Company's 2024 Business Report and Financial Statements.
2.The Company's declaration on internal control system for the year 2024.
3.Assessment of the Independence of Certified Public Accountants and the 2025
Audit Fees.
4.Proposal for participating in the capital increase of the subsidiary, Chu-Ting
Enterprise Co., Ltd.
5.Proposal for the amendment to the Company's "Procedures for Lending Funds to
Other Parties.”
6.Proposal for the 2024 Profit Distribution.
No other opinions were expressed by
attending members.
After obtaining unanimous approval,
it was presented to
the Board of Directors for discussion
and was passed without objection
by all attending directors.
1st session,17nd
time
2025.5.14
1.Proposal for the Company's Q1 2025 Financial Statements.
2. Proposal for the amendment to the general principles of the Company’s "Policy on
Pre-approval of Non-Assurance Services."
2st session,1nd
time
2025.8.14
1.Proposal for the Company's Q2 2025 Financial Statements.
2.Proposal for the Company's 100% investment in Shanghai Lizhengda Industrial
Co.,Ltd.
2st session,2nd
time
2025.11.13
1. Proposal for the Company's Q3 2025 Financial Statements.
2st session,3nd
time
2025.12.16
1.Develop an operational plan for 2026.
2.The proposed audit plan for the fiscal year 2026.
3.Revise the "Internal Control System" and "Internal Audit Implementation Rules"
2st session,4nd1.Proposal for the Company's 2025 Business Report and Financial Statements.
1st session,17nd
time
2025.5.14
1.Proposal for the Company's Q1 2025 Financial Statements.
2. Proposal for the amendment to the general principles of the Company’s "Policy on
Pre-approval of Non-Assurance Services."
2st session,1nd
time
2025.8.14
1.Proposal for the Company's Q2 2025 Financial Statements.
2.Proposal for the Company's 100% investment in Shanghai Lizhengda Industrial
Co.,Ltd.
2st session,2nd
time
2025.11.13
1. Proposal for the Company's Q3 2025 Financial Statements.
2st session,3nd
time
2025.12.16
1.Develop an operational plan for 2026.
2.The proposed audit plan for the fiscal year 2026.
3.Revise the "Internal Control System" and "Internal Audit Implementation Rules"
2st session,4nd 1.Proposal for the Company's 2025 Business Report and Financial Statements.

~ 31 ~

==> picture [818 x 548] intentionally omitted <==

----- Start of picture text -----

time 2.The Company's declaration on internal control system for the year 2025.
2026.3.11 3.Proposal for the appointment of Certified Public Accountants and the 2026 Audit
Fees.
4.Proposal for the 2025 Profit Distribution.
(2) In addition to the above matters, there were no other resolutions that were not approved by the Audit Committee but were approved
by a majority of two-thirds or more of the entire board of directors.
2. The implementation status of independent directors' recusal from matters involving conflicts of interest shall include the names of
independent directors, the content of the agenda, reasons for recusal due to potential conflicts of interest, and their participation in the
voting process: No such instances.
3. Communication between Independent Directors and Auditors (including significant matters, methods, and outcomes regarding the
company's finances and business conditions).
(1) The CPA shall meet with the independent directors individually at least once a year to report on the audit or review results, as well as
any significant matters requiring attention.
(2) Other: InIn the event of significant irregularities or matters deemed necessary for independent communication by the independent
directors or CPAs, meetings may be convened on an ad-hoc basis at any time.
Date Attendees Matters discussed Results of
communication
2025/12/16 Independent Director Maa, Kwo-Juh Communication with the No objections.
Independent Director Lee, Shiue-Chen company's governance unit for
Independent Director Chang, Chiu-Jung the third quarter of 2025.
Independent Director Lin, Ruey-Tou
CPA: Chin, Shih-Chin
(3) Involvement of the supervisor in the operations of the board of directors.
On June 23, 2023, the company established an Audit Committee to replace the role of the supervisor. Therefore, the involvement of the
supervisor in the operation of the board is no longer applicable from that date.
(4) The state of the Company's implementation of corporate governance, any departure of such implementation from the Corporate Governance
~ 32 ~
----- End of picture text -----

Best-Practice Principles for TSEC/TPEx Listed Companies, and the reason for any such departure.

Item Implementation Status
The Reason of
Departure from the
Corporate
Governance Best
Practice Principles
for TWSE & TPEx
Listed Companies
Summary and Explanation		 Implementation Status
The Reason of
Departure from the
Corporate
Governance Best
Practice Principles
for TWSE & TPEx
Listed Companies
Summary and Explanation
Yes No
1. Does the company」establish and disclose a
code of practice of corporate governance in
accordance with the “Corporate Governance Best
Practice Principles for TWSE & TPEx Listed
Companies?”		 v To establish sound corporate governance practices, our company has referred to the Corporate
Governance Best Practice Principles for Listed and OTC Companies established by the Taiwan
Stock Exchange and the Taipei Exchange. We have formulated our own Corporate Governance
Guidelines for compliance and have disclosed them on the Market Observation Post System.
We comply with
the requirements of
the "Corporate
Governance Best
Practices for Listed
and OTC
Companies."
2. Equity Structure and Shareholders' Equity of the
Company
(1) Does the Company have internal procedures in
place to handle shareholders’ suggestions,
questions, disputes, and lawsuits, and implement
these procedures accordingly?
(2) Does the Company have a list of its major
shareholders and a list of actual controllers of the
major shareholders?
(3) Does the Company establish and implement risk
management and firewall mechanisms with
related companies?
(4) Does the Company have internal rules that
prohibit insiders from trading securities using
market information that is not publicly available?
v
v
v
v		 (1)Shareholder suggestions or disputes are handled by a dedicated spokesperson or proxy
spokesperson appointed by the company. Shareholders can submit their questions through
telephone or the company's website. If legal issues are involved, assistance from legal
professionals is sought.
(2)The company regularly obtains the latest shareholder registry from a shareholder services
agency to understand the list of major shareholders and the ultimate controllers of major
shareholders.
(3)Assets, financial operations, and accounting related to related-party transactions are
independently operated by dedicated personnel. The head office conducts periodic audits,
and transactions with related parties are conducted in accordance with the company's
internal control rules.
(4)The company has established the "Internal Handling Procedures for Material Information"
and the "Internal Handling and Prevention of Insider Trading Procedures" to prevent
unauthorized disclosure of information and ensure consistency and accuracy in the
company's external communications.










We comply with
the requirements of
the "Corporate
Governance Best
Practices for Listed
and OTC
Companies."

~ 33 ~

==> picture [724 x 419] intentionally omitted <==

----- Start of picture text -----

Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
3. Composition and Responsibilities of the Board of v (1)The company advocates and respects a policy of board diversity to enhance corporate We comply with
Directors governance and promote the sound development of the board's composition and structure. We the requirements of
(1) The Board of Directors has formulated a policy believe that a diverse board can contribute to the overall performance of the company. The the "Corporate
on diversity, specific management objectives, and selection of board members is based on the principle of selecting individuals with diverse and Governance Best
has effectively implemented them. complementary capabilities across industries. This includes basic diversity factors such as age, Practices for Listed
gender, and nationality, as well as industry experience and relevant skills in areas such as and OTC
finance, accounting, legal, information technology, and public utilities. Additionally, board Companies."
members possess abilities in business judgment, management, leadership decision-making, and
crisis handling. Article 20 of the "Corporate Governance Practices Guidelines" states that the
board as a whole should possess the following abilities to strengthen its functions and achieve
the ideal goals of corporate governance:
Core elements Gender Operati Accoun Bus Cri Ind inte lea dec Leg
of diversity onal ting ines sis ustr rnat der isio al
judgme and s ma y ion shi n-m kno
nt financia ma nag kno al p aki wle
ability l nag em wle mar abil ng dge
analysis em ent dge ket ity abil
ability ent abil insi ity
abil ity ght
ity
Director's name
Lin, Weng-Teng Male v v v v v v v v
Lin, I-Chin Female v v v v v v v v
Pan, Hsin-Jen Male v v v v v v v
Lin, Jui-Ping Female v v v v v v v v
Liu, Nien-Fu Male v v v v v v v
Lin, Ruey-Tou Male v v v
Maa, Kwo-Juh Male v v v v v v v v v
Lee, Shiue-Chen Male v v v v v v v v
Chang, Chia-Jung Female v v v v v v
----- End of picture text -----

~ 34 ~

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----- Start of picture text -----

Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
----- End of picture text -----

(2)Besides the Compensation Committee and Audit
Committee, does the company voluntarily set up
other functional committees?
(3) Has the company established a board
performance evaluation method and its
evaluation method, conducted performance
evaluations regularly every year, and reported the
results of the evaluation to the board for use as a
reference for individual director compensation
and nomination for reappointment?

v
v		 (2) The company currently has established an Audit Committee and a Compensation
Committee. Regarding the establishment of other functional committees, the company has
conducted an overall assessment considering the effective utilization of resources and the
absence of an urgent need for their establishment at present. However, future establishment of
such committees will be based on the actual operational situation.
(3) The company has conducted evaluations in accordance with the "Board Performance
Evaluation Measures," which include the overall board, individual director members, and
functional committees. The evaluation methods include self-assessment within the board and
self-assessment by director members. The performance evaluation of the board covers six
major dimensions: 1. Understanding of company goals and missions. 2. Awareness of director
responsibilities. 3. Involvement in company operations. 4. Internal relationship management
and communication. 5. Director's expertise and continuous professional development. 6.
Internal controls.
The company's shareholder services department conducts an evaluation of the overall
performance of the board of directors at the end of each fiscal year. The results of this
evaluation are utilized as a reference for future director selection, nomination, and
determination of individual director compensation.

~ 35 ~

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----- Start of picture text -----

Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
(4) Does the company regularly assess the v (4)The company's designated auditing firm is KPMG. The company follows the provisions of
independence of its auditing CPAS? Article 47 of the Accountants Act and formulates independence assessment criteria based
on the contents of Bulletin No. 10, "Integrity, Fairness, Objectivity, and Independence,"
regarding independence and professional ethics. The appointment and independence
assessment of auditors Chin, Shih-Chin and Huang, Hsin-Ting for the current year were
approved by the board of directors on March 11, Year 2026. The assessment criteria
include:
Evaluatio Compliance
n Results with
Evaluation Items
independence
requirements
1. No significant financial interest with the client. Yes Yes
2. Avoiding any inappropriate relationship with the client. Yes Yes
3.The auditor must ensure the honesty, fairness, and independence of their Yes Yes
assistants.
4.The auditor is prohibited from auditing the financial statements of a client for Yes Yes
whom they provided services within the previous two years.
5. The auditor cannot allow others to use their name. Yes Yes
6. The auditor cannot hold shares of the client. Yes Yes
7. The auditor cannot engage in monetary loans with the client, except for Yes Yes
normal financial transactions with the financial industry.
8. The auditor cannot have joint investments or profit-sharing relationships with Yes Yes
the client.
9. The auditor cannot hold a regular job or receive a fixed salary from the Yes Yes
client.
10. The auditor cannot be involved in management functions that may Yes Yes
compromise their independence.
11. The auditor cannot engage in any other business activities that may Yes Yes
jeopardize their independence.
12. The auditor cannot perform auditing services for a client if they have a Yes Yes
spousal, direct blood relative, direct relative by marriage, or fourth-degree
collateral blood relationship with the client or its management personnel.
13. The auditor cannot receive any commissions related to their professional Yes Yes
services.
After evaluation, both auditors have been found to meet the requirements for independence and
qualification.
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~ 36 ~

Item Implementation Status
The Reason of
Departure from the
Corporate
Governance Best
Practice Principles
for TWSE & TPEx
Listed Companies
Summary and Explanation		 Implementation Status
The Reason of
Departure from the
Corporate
Governance Best
Practice Principles
for TWSE & TPEx
Listed Companies
Summary and Explanation
Yes No
4. Does the company allocate a sufficient
number of qualified and appropriate
corporate governance personnel and
designate a corporate governance officer
responsible for corporate governance-related
matters (including, but not limited to,
providing necessary information to directors
and supervisors for their duties, assisting
directors and supervisors in complying with
laws, conducting board of directors and
shareholders' meetings, preparing minutes of
meetings,etc.)?		 v In accordance with the company's "Corporate Governance Guidelines," the management team
is responsible for fulfilling their duties and implementing the corporate governance system.
According to the company's "Board of Directors Meeting Procedures" and "Remuneration
Committee Organization Rules," Lin, Jui-Ping, Vice General Manager of the General
Management Department and General Manager of the Electronics Division, has been
appointed as the Corporate Governance Officer. Additionally, a corporate governance task
force consisting of four members from the Finance Department, Internal Audit, and
Shareholder Services has been formed to handle related corporate governance matters. This
includes providing the board with necessary information for business execution, managing
board and shareholder meetings in compliance with the law, handling company registration,
preparing minutes for board and shareholder meetings, and assisting the board in strengthening
its functions to ensure the protection of stakeholder interests and the fair treatment of
shareholders.		 We comply with
the requirements of
the
"Corporate
Governance
Best
Practices for Listed
and
OTC
Companies."

~ 37 ~

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Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
(5) Whether the company has established v The company has currently disclosed a stakeholder section and an investor relations We comply with
communication channels with stakeholders contact window on its website www.rectron.com.tw, and appropriately addresses the requirements
(including but not limited to shareholders, important corporate social responsibility issues raised by stakeholders. of the "Corporate
employees, customers, and suppliers), and set The company respects the rights and interests of stakeholders. When the legitimate Governance Best
up a stakeholder section on the company's rights and interests of stakeholders are infringed upon, the company handles them Practices for
website to address important corporate social appropriately based on the principles of good faith: Listed and OTC
responsibility issues raised by stakeholders. (1) Banks and creditors: Direct communication with the company's financial Companies."
supervisor or treasury personnel to provide sufficient information for their
management decisions.
(2) Employees: Direct communication through the company's internal complaint
channels in written or email form, with supervision from the management
department.
(3) Suppliers: Acceptance of suggestions and communication coordination by the
procurement supervisor and procurement personnel.
(4) Consumers: Direct communication with customers by the business supervisor or
sales staff, promptly addressing customer demands and product feedback, and
resolving related issues immediately.
(5) Communities or stakeholders: Communication with the company is conducted by
the company's spokesperson or authorized representative. For nearby
communities, communication with the communities is conducted by the plant
manager on behalf of the company.
(6) The company has currently disclosed a stakeholder section and an investor
relations contact window on its website, appropriately addressing important
corporate social responsibility issues raised by stakeholders.
6. Does the company appoint a professional v The company has appointed a professional share registrar agency, " IBF Securities We comply with the
requirements of the
stock agency to handle the affairs of the Co., Ltd" Share Registrar Department," to handle shareholder meeting affairs. "Corporate Governance
Board of Shareholders? Best Practices for Listed
and OTC Companies."
7. Information Disclosure We comply with
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~ 38 ~

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----- Start of picture text -----

Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
----- End of picture text -----

(1) Does the company have a website that
discloses financial and corporate
governance information?
(2)The company has implemented other forms
of information disclosure (such as
establishing an English website,
designating dedicated personnel for
collecting and disclosing company
information,
implementing a spokesperson system, and
placing the process of corporate
presentations on the company's website)?
(3) Has the company announced and filed its
annual financial report within two months
after the end of the accounting year, and
announced and filed its first, second, and
third quarter financial reports and monthly
business operations before the prescribed
deadline?		 v
v		 v (1) The company's website, www.rectron.com.tw, is used to disclose financial,
operational, and corporate governance information.
(2) The company has designatedindividuals responsible for collecting and disclosing
company information. It has established a spokesperson and proxy spokesperson
system and has set up an investor mailbox to promptly respond to investor
inquiries. All relevant information that the company is required to disclose by law
is promptly announced and made available for investor clarity and queries through
the "Public Information Observation System."
(3) The company completes the announcement and filing of the annual financial report
withinthe prescribed deadline after the end of the fiscal year. It also meets the
deadlines for announcing and filing the first, second, and third quarterly financial
reports and provides information on monthly operating performance.








the requirements
of the "Corporate
Governance Best
Practices for
Listed and OTC
Companies."

~ 39 ~

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----- Start of picture text -----

Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
----- End of picture text -----

8. Does the company have other important
information that helps understand the
operation of corporate governance (including
but not limited to employee benefits,
employee care, investor relations, supplier
relationships, rights of stakeholders, status of
education and training for directors and
supervisors, implementation of risk
management policies and risk measurement
standards, execution of customer policies,
and the company's purchase of liability
insurance for directors and supervisors)?		 v (1) Employee benefits:
The company has always treated its employees with integrity and adhered to
relevant labor laws to safeguard their legal rights and interests.
(2) Employee Care:
The company establishes personnel management regulations based on
government laws and regulations such as the Labor Standards Act, Gender
Equality Act, and Sexual Harassment Prevention Act as the minimum standards to
protect employee rights. Regular labor-management meetings are held for
effective communication. Additionally, a "Welfare Committee" is established,
allocating funds monthly to organize employee welfare activities, including
holiday gift vouchers, year-end party lucky draws, health check-ups, and labor,
health, and group insurance.
(3) Investor Relations:
The company appoints a spokesperson and proxy spokesperson to handle
shareholder suggestions or disputes, aiming to establish effective communication
between the company and investors. This ensures that investors have a
comprehensive understanding of the company's business performance,
achievements, and long-term operational strategies.
(4) Supplier Relationships:
The company promotes "green procurement" and requires suppliers of raw
materials to provide declarations guaranteeing that their products do not contain
harmful substances to the environment. This ensures compliance with customer
and EU RoHS regulations. Furthermore, communication with suppliers is
conducted to enhance their positive impact on society and the environment.
(5) Rights of Stakeholders:
Stakeholders can communicate with the company or provide feedback through
the dedicated stakeholder section on the company's website, ensuring the
protection of their relevant rights and interests.
Compliance with
the "Corporate
Governance Best
Practice
Principles for
Listed
Companies"
requirements.

~ 40 ~

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Implementation Status The Reason of
Departure from the
Corporate
Item Governance Best
Yes No Summary and Explanation Practice Principles
for TWSE & TPEx
Listed Companies
(6) Directors and Supervisors Continuing Education: Please refer to the company's
2024 annual report (Section Ten).
(7) Implementation of Risk Management Policies and Risk Measurement Standards:
The company has established various internal regulations and conducts risk
management assessments.
(8) Implementation of Customer Policy: The company has established the "Code of
Business Conduct" to adhere to ethical business practices. Please refer to Section
Five of the company's 2025 annual report for an overview of operations.
(9) Purchase of Directors and Supervisors Liability Insurance: In 2025, the company
obtained directors and officers liability insurance coverage of USD 1 million. As of
the publication of the annual report, the coverage has not expired. The renewal
process will be completed before the expiration in June 2025, and important details
of the insurance will be submitted to the upcoming board of directors meeting.
9. please provide an explanation of the improvements made based on the recent corporate governance evaluation published by the Corporate Governance Center of
Taiwan Stock Exchange, and propose priority areas and measures for further enhancement where improvements have not yet been made: The company is
continuously addressing relevant matters and measures based on the corporate governance evaluation results and in accordance with the Corporate Governance
Best Practice Principles.
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~ 41 ~

(5) Composition, Responsibilities, and Utilization of the Remuneration Committee:

(1) Compensation Committee Membership Details

March 31, 2026 March 31, 2026 March 31, 2026 March 31, 2026 March 31, 2026
Cond
itions
Identity
(Note 1)Name
Professional Qualifications and
Experience (Note 2)
Independence Status (Note 3)
Number of members
who are also members
of the compensation
committee of other
public corporations.
Independent
Director
Convener
Lin, Ruey-Tou
Department of Business Administration,
Tamkang University
Honorary Consultant to the Legislative
Yuan
Municipal Consultant to the Taipei City
Council
Municipal Consultant to the Taipei City
Government
Independence status
All threepositions have no circumstances as
described in Note 2. Furthermore, they have
obtained a declaration of independence
from independent directors, confirming
their compliance with the legal
requirements for independence (at the time
of appointment and during their term).
None
Independent
Directore		 Maa, Kwo-Juh Master's degree in Accounting from
National Chengchi University.
Passed the Certified Public Accountant
(CPA) Examination in Taiwan.
Chief Consultant at KPMG.
CEO at KPMG Taiwan.
Chairman and CEO at KPMG Taiwan.
President of the Corporate Governance
Professionals Association, a non-profit
organization
Wisdom Marine Group Independent
Director Independent Director
Pontens Semiconductor co.,Ltd.
Independent Director Independent Director
Chih Yeh ConsultancyLimited CEO.		 Independence status
All three positions have no circumstances as
described in Note 2. Furthermore, they have
obtained a declaration of independence
from independent directors, confirming
their compliance with the legal
requirements for independence (at the time
of appointment and during their term).

2 companies

~ 42 ~

Independent
Director		 Lee, Shiue-Chen Tamkang University, Department of
Accounting
Audit Manager at KPMG United
Accounting Firm.
Finance and Accounting Manager at Pao Lai
Construction Co., Ltd.
Finance and Accounting Manager at Hong
Guo Group's affiliated business.
Deputy General Manager of Fulai
Construction Co.,Ltd.
Independence status
All members of the Compensation
Committee meet the independence criteria
as specified in Note 2. They have also
obtained a declaration from the
Compensation Committee members
confirming their compliance with the legal
requirements for independence during their
appointment and tenure.		 None

  • Note 1: For relevant work experience, professional qualifications, experience, and independence status of Compensation Committee members, please refer to the information provided in "Directors and Supervisors Data (1)."

  • Note 2: Independence criteria include but are not limited to the following: whether the Compensation Committee member, their spouse, or relatives within the second degree of kinship serve as directors, supervisors, or employees of the company or its related enterprises; whether the member, their spouse, or relatives within the second degree of kinship (or through the use of others' names) hold shares in the company and the proportion of such holdings; whether they serve as directors, supervisors, or employees of specific related companies with the company (as defined in Article 6, Paragraph 1, Subsections 5-8 of the Regulations Governing the Establishment and Exercise of Powers of Compensation Committees of Listed and OTC Companies); and the remuneration received for providing business, legal, financial, accounting, or other services to the company or its related enterprises in the past two years.

(2) Duties of the Compensation Committee:

Legal basis: Article 4 and Article 5 of the "Organizational Regulations of the Compensation Committee" of the company. According to Article 4 of the regulations:

  • The committee shall faithfully fulfill the following duties with the care of a good manager and submit its recommendations to the Board of Directors for discussion:

  • Establish and regularly review the performance evaluation criteria for directors, supervisors, and managers, as well as the annual and long-term performance objectives, compensation policies, systems, standards, and structures. Disclose the content of the performance evaluation criteria in the annual report.

  • Conduct regular evaluations and set performance targets for directors, supervisors, and managers. Based on the evaluation results derived from the performance evaluation criteria, determine the content and amount of their individual compensation. The annual ~ 43 ~

report should disclose the individual performance evaluation results of directors and managers, as well as the content, amount, relevance, and reasonableness of individual compensation in relation to the evaluation results, and report them at the shareholders' meeting.

The term "compensation" referred to in the above provisions includes cash compensation, stock options, bonus shares, retirement benefits or severance pay, various allowances, and other substantial incentive measures. Its scope should be consistent with the matters to be disclosed in the guidelines for items related to remuneration of directors, supervisors, and managers of publicly listed companies.

According to Article 5, the principles for fulfilling the duties are as follows:

  1. The performance evaluation and compensation of directors, supervisors, and managers should reference the customary levels of the industry and consider the reasonable correlation with individual performance, company's operating performance, and future risks.

  2. Directors and managers should not be encouraged to engage in activities that exceed the company's risk tolerance in pursuit of compensation.

  3. The proportion of short-term performance-based bonuses and the timing of variable compensation payments for directors and senior executives should be determined taking into account the industry characteristics and the nature of the company's business.

  4. The content and amount of compensation for directors and managers should be reasonable and considerate. The determination of directors' and managers' compensation should not significantly deviate from the financial performance. If there is a significant decline in profits or long-term losses, the annual compensation should not be higher than the previous year. If it is still higher than the previous year, a reasonable explanation should be disclosed in the annual report and reported at the shareholders' meeting.

  5. When discussing the recommendations of the remuneration committee, the board of directors should consider various factors, including the amount, payment methods, and future risks of compensation.

  6. If the board of directors does not adopt or modifies the recommendations of the remuneration committee, it must be approved by a two-thirds majority of the directors present at the meeting, with the agreement of a majority of the attending directors. The resolution should comprehensively consider and specifically explain whether the adopted remuneration is better than the recommendations of the remuneration committee.

  7. If the remuneration approved by the board of directors is better than the recommendations of the remuneration committee, the differences and reasons should be recorded in the minutes of the board of directors' meeting. Furthermore, within two days from the date of the board's approval, the company should make an announcement and report the information on the designated information

~ 44 ~

disclosure website of the competent authority.

  1. For matters related to the compensation of directors and managers of subsidiary companies that require approval from the board of directors of the parent company due to the hierarchical responsibility of the subsidiary companies, the remuneration committee of the parent company should submit recommendations to the board of directors for discussion.

(3) Information about the Operation of the Compensation Committee

1.The Company has 3 members of the Compensation Committee.

2.Current term of the committee: August 14, 2025, to May 28, 2028. In the most recent fiscal year, the remuneration committee held 2 meetings (A), and the qualifications and attendance of the committee members are as follows:

Job Title
Name
Number of attendance
in person (B)
Delegated attendance
count
Rate of attendance in
person (%)
(B/A)
(Note)
Remarks
Convener
Lin, Ruey-Tou
2
0
100%
Committee
member
Maa, Kwo-Juh
2
0
100%
Committee
member
Lee, Shiue-Chen
2
0
100%
Other items that shall be recorded:
1. If the Board of Directors rejects or amends the suggestions of the Compensation Committee, the date, session number, proposal content, results of
Board resolution, and the Company’s handling of Compensation Committee’s opinions should be recorded in details (e.g., where the compensation
approved by the Board is higher than the compensation suggested by the Compensation Committee, the difference and reasons should be detailed):
None.
2. If any Committee member has objections and/or reservations with the resolutions of the Compensation Committee and such situations were
recorded or as written statements, the committee meeting date, session number, proposal content, all members’ opinions, and the handling of
opinions shall be documented in details: None.
3. If any Committee member has objections and/or reservations with the resolutions of the Compensation Committee and such situations were
recorded or as written statements, the committee meeting date, session number, proposal content, all members’ opinions, and the handling of
opinions shall be documented in details: None.
4. Discussions and Resolutions of the Remuneration Committee, and Company's Handling of Member Opinions:

~ 45 ~

Remuneration
Committee
MeetingDates
Content and Follow-up of the Proposal
Handling of all remuneration
committee opinions and company
remunerationcommittee opinions		 Remuneration
Committee
MeetingDates
Content and Follow-up of the Proposal
Handling of all remuneration
committee opinions and company
remunerationcommittee opinions
2025.03.11
Distribution of employee remuneration and director and
supervisor remuneration for the fiscal year 2024.
Remuneration Committee Resolution:
The resolution was unanimously
approved by all committee members.
Company's Handling of
Remuneration Committee Resolution:
The resolution was approved by the
attending directors without any
objections, in accordance with the
recommendation of the Remuneration
Committee.
2025.11.13
Distribution of Directors’ Remuneration for Fiscal Year
2024.
2025.11.13 Distribution of Directors’ Remuneration for Fiscal Year
2024.

(4) Nomination Committee Member Information and Operation Status: The company has not established a Nomination Committee .

~ 46 ~

(6) The implementation of sustainable development and the differences with the sustainability practices guidelines of listed companies are as follows:

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----- Start of picture text -----

Implementation Status The Reason of Departure
from the Corporate
Item Governance Best Practice
Yes No Summary and Explanation
Principles for TWSE &
TPEx Listed Companies
----- End of picture text -----

Item Yes No Implementation Status
Summary and Explanation		 The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
1. Is the company established with a
governance framework for promoting
sustainable development, including the
establishment of dedicated personnel
responsible for driving sustainable
development initiatives, authorized by the
board of directors and supervised by the
board of directors?		 v 1.To deepen engagement with sustainable development and
fulfill corporate social responsibility (CSR), the Company has
established the "Sustainable Development Best Practice
Principles." The Board of Directors serves as the highest
governance body for promoting these initiatives, periodically
reviewing progress. Under the Board’s oversight, a Corporate
Governance Task Force has been established to propose and
execute sustainability policies, systems, or management
strategies and specific action plans, reporting to the Board on
a regular basis.
2.Regarding the Board’s oversight for fiscal year 2025, the
Corporate Governance Task Force has submitted progress
reports to the Board on a quarterly basis.		 Future compliance with
legal requirements will
be ensured.

~ 47 ~

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----- Start of picture text -----

Implementation Status The Reason of Departure
from the Corporate
Item Governance Best Practice
Yes No Summary and Explanation
Principles for TWSE &
TPEx Listed Companies
----- End of picture text -----

Item Yes No Implementation Status
Summary and Explanation		 The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
2. Has the Company conducted risk
assessments on environmental, social, and
corporate governance issues related to its
operations, in accordance with the principles
of materiality, and established relevant risk
management policies or strategies?
v		 1. The company has established the "Corporate Governance
Best Practice Principles" to ensure effective corporate
governance, promote sustainable environmental
development, and uphold social welfare. The "Insider
Trading Prevention Operational Procedures," "Code of
Conduct," and "Internal Control System" formulated by the
company are designed to implement risk management
policies. The content of these policies is developed in
compliance with relevant government regulations.
2. To enhance the management of corporate social
responsibility, the company has formed a committee
comprising personnel from different departments to promote
corporate social responsibility as part of their job
responsibilities. The Deputy General Manager of the
General Administration Department is responsible for
overseeing these initiatives and regularly reporting the
progress and effectiveness to the board of directors.
To fulfill our corporate social responsibility, one of our
subsidiaries entered the medical equipment field in 2020 to
contribute to public safety during the pandemic.
3. The Company conducts materiality assessments through a
three-step process: "Identification, Assessment, and
Analysis." We examine the actual and potential impacts of
our business activities across economic, environmental, and
social dimensions. These findings serve as the foundation
for planning and refining our sustainability management
strategies.
4. Based on the results of the materiality assessment, we have
identified five material topics: Customer Service and
Management, Sustainable Supply Chain Management,
Talent Management and Development, Human Rights and
Equal Opportunity, and Energy Management.
No difference found.

~ 48 ~

Item Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Summary and Explanation		 Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Summary and Explanation
Yes No
3. Environmental issues
(1) Has the company established an
appropriate environmental management
system based on its industry
characteristics?		 v (1) The company has obtained ISO 14001 certification for its
environmental management system, which effectively
prevents and controls environmental pollution while
improving energy efficiency.
No difference found.
(2) The company is committed to enhancing
energy efficiency and utilizing low-impact
renewable materials to minimize
environmental burdens.		 v (2) In recent years, due to energy shortages and escalating
ecologicaldamage, along with the increasingly severe
issue of global warming, the company has been
implementing various measures to promote energy
conservation and carbon reduction. This includes the
adoption of energy-saving equipment in offices,
advocating for energy-saving practices, encouraging
employees to conserve energy, and strengthening
resource utilization and recycling to reduce the impact on
the environment.
No difference found.
(3) Has the company evaluated the potential
risks and opportunities of climate change on
its current and future operations, and taken
climate-related measures in response?
v		 (3)The company evaluates the potential risks and opportunities
posed by climate change to its current and future operations
and takes corresponding measures to address climate-related
issues. Thecompany continues to monitor the impact of
climate change on its business activities and invests in
pollution control equipment to reduce the environmental
impact of its operations. As a manufacturing company,
potential risks mainly include resource shortages, rising raw
material costs, unstable transportation demand,and threats
to employee safety from extreme weather conditions. These
factors could potentially affect the company. To mitigate
risks, the company not only stays informed about
international trends but also improves energy efficiency,
actively develops related products using green energy
technologies, reduces water and electricity consumption,
and adopts more efficientprocesses to lower operatingcosts.














No difference found.

~ 49 ~

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----- Start of picture text -----

Implementation Status The Reason of Departure
from the Corporate
Item Governance Best Practice
Yes No Summary and Explanation
Principles for TWSE &
TPEx Listed Companies
----- End of picture text -----

Item Yes No Implementation Status
Summary and Explanation		 The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
(4) The company tracks greenhouse gas
emissions, water consumption, and total
waste weight over the past two years and
has developed policies for energy
conservation, carbon reduction, greenhouse
gas reduction, water conservation, and
waste management.		 v (4) The company strives to meet the goal of low-carbon
manufacturing. In order to increase the use of renewable
energy, annual energy reduction measures are formulated
and reviewed every year. In addition, the waste recycling
rate can be improved by changing the use requirements of
raw materials. Starting from 2025, due to factors such as
electricity price adjustments by Taiwan Poewr Company,
increased costs for waste removal and treatment, and
higher water usage resulting from soil and groundwater
remediation projects at the factory, the Tucheng Plant has
implemented operational adjustments in response to
various environmental issues in order to achieve the goal
of sustainable corporate operations.
Greenhouse gas emissions: 5.3% reduction compared to
2024.
Carbon emission intensity: reduced by 5.0% compared
with 2024.
Water consumption: increase of 23.8% compared with
2024.
Electricity consumption: 4.00% less than in 2024.
Waste: 16.10%less than in 2024.		 No difference found.

~ 50 ~

Item Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Summary and Explanation		 Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Summary and Explanation
Yes No
4. Social Issues
(1) The company has developed management
policies and procedures in accordance with
relevant laws and international human
rights conventions.
v		 (1) The company complies with the International Bill of
Human Rights and national labor laws, and has
established employee "work rules" and a
labor-management committee. Important matters are
communicated and coordinated between labor and
management representatives, and regular assessments and
discussions on human rights issues are conducted to
safeguard the rights and interests of employees.
1. Employee Rights: The company ensures compliance
with legal requirements for employee labor insurance,
national health insurance, and retirement pension
contributions.
2. Insurance: The company has obtained public liability
insurance and employee group insurance.
3. Management Procedure: Work rules have been
implemented and published on both the company
bulletin board and the intranet for all employees to
follow.
No difference found.
(2) Has the company established and
implemented reasonable employee welfare
measures (including salary, vacation, and
other benefits), and appropriately reflected
business performanceor results in employee
compensation?
v		 (2) The company adheres to the Labor Standards Act and
relevant regulations to establish various salary and
benefits measures for employees. It provides competitive
welfare benefits to motivate employees, conducts regular
assessments, and distributes performance bonuses to share
theachievements of the company's operations.		 No difference found.

~ 51 ~

Item Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Yes
No
Summary and Explanation		 Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Yes
No
Summary and Explanation		 Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Yes
No
Summary and Explanation		 Implementation Status
The Reason of Departure
from
the
Corporate
Governance Best Practice
Principles for TWSE &
TPEx Listed Companies
Yes
No
Summary and Explanation
(3) The company provides a safe and healthy
working environment for employees and
regularly conducts safety andhealth
education.
v
(3) The company conducts annual employee health checks
and provides counseling for employees on psychological
issues by physicians. It regularly organizes fire safety
training and implements safety personnel to ensure a
secure working environment. The company conducts
regular inspections of safety precautions in the work
environment. Through continuous education and training,
as well as employee awareness, unsafe behaviors leading
to accidents are reduced. The company promotes a
smoke-free working environment to enable employees to
work in a comfortable and healthy atmosphere. It
regularly maintains and disinfects water supply facilities.
In case of natural disasters or accidents caused by human
error, the company conducts periodic fire/earthquake
drills to ensure that employees are well-prepared and
capable of handling emergencies according to the
contingency plans, minimizing the impact on employees.
Additionally, the company provides group insurance for
employees, ensuring appropriate medical coverage in
case ofwork-relatedinjuries.
No difference found.
(4) The company establishes an effective
career development and training plan for
employees.
v
(4) To promote employees' career development, the company
regularly conducts internal or external training programs
to enhance their professional capabilities.
No difference found
(5) With regard to issues such as customer
health and safety, customer privacy,
marketing and labeling related to products
and services, doesthe company comply
with relevant laws and international
standards, and develop relevant policies
and complaint procedures to protect
consumerorcustomer rights?






v		 (5) The company values customer feedback and provides
channels for customers to contact them, such as
dedicated product contact points and email addresses.
They also have a dedicated section for stakeholders to
submit inquiries, complaints, or suggestions. The
company upholds ethical and integrity principles and
ensures appropriate handling and feedback to safeguard
customer rights.		 No difference found.

~ 52 ~

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Implementation Status The Reason of Departure
from the Corporate
Item Governance Best Practice
Yes No Summary and Explanation
Principles for TWSE &
TPEx Listed Companies
(6) Has the company established a supplier v (6) The company has a supplier evaluation method that No difference found.
management policy, requiring suppliers to requires suppliers to meet the company's requirements
follow relevant regulations on for product safety and ethical standards. It encourages
environmental protection, occupational suppliers to enhance their social and environmental
safety and health, or labor rights, and responsibilities, including compliance with labor rights,
implemented such policy? health and safety standards, environmental protection,
and ethical norms. By working together with suppliers,
the company strives for sustainable development and
improves corporate social responsibility efforts.
5. Has the company referred to internationally v The company complies with the requirements and regulations The company has not yet
recognized standards or guidelines for of the competent authorities and relevant laws in fulfilling its prepared a corporate
preparing non-financial reports such as corporate social responsibility. The company has established a responsibility report. The
sustainability reports? Has the dedicated section on its website for corporate social decision to compile such a
aforementioned report obtained a responsibility, where relevant information will be disclosed, report will be based on the
confirmation or assurance opinion from a including on the company's website and public information company's development
third-party verification agency? disclosure platforms. needs and regulatory
requirements.
6. If the company has established its own sustainability guidelines based on the "Practical Guidelines for Sustainable Development of Listed and OTC
Companies," please describe how they differ from the operational guidelines established.
The company has not yet established a corporate social responsibility (CSR) code, therefore this item is not applicable. However, the company actively
promotes various social responsibilities and is committed to complying with the requirements outlined in the "Guidelines for Corporate Social
Responsibility Practices of Listed and Over-the-Counter Companies."
----- End of picture text -----

  1. Other important information to understand the execution of sustainable development:

The company has formulated product environmental protection specifications to control products without hazardous substances. It has obtained ISO 14001: 2015 Environmental Management System Certification. The production of products complies with the EU ROHS requirements and incorporates halogen-free design., and plan to obtain ISO 45001:2018 (formerly OHSAS 18001) occupational safety and health management system certification. In terms of greenhouse gas management, the company has currently implemented a self-inspection of carbon emissions. In the future, it will cooperate with the government's requirements to implement ISO 14064 greenhouse gas emission verification/confirmation to promote corporate social responsibility and continue to meet the technical requirements of environmental protection of customer products.

~ 53 ~

  • (7) If the company has established corporate governance guidelines and related regulations, the inquiry methods should be disclosed. The company's website provides an "Information Disclosure" section where stakeholders can access and download relevant regulations, including corporate governance practices, code of conduct, ethical guidelines, and important board decisions. The website address is http://www.rectron.com.tw.

  • (8) Climate-related information of TWSE/ TPEx Listed companies ：

Implementation status of climate-related information

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Item Implementation Status
1.Describe board and management oversight and governance of The company's board of directors continues to pay attention to the
climate-related risks and opportunities. operational risks and business opportunities derived from climate change,
so it will take climate change issues into consideration. If major capital
investments are considered, priority will be given to energy conservation,
carbon reduction and green energy for evaluation. The company's
management continues to support the company in implementing energy
conservation, water conservation, waste reduction and greenhouse gas
reduction management.
2.Describe how the identified climate risks and opportunities impact the Short-term impact : Our current risk profile is driven by the TWSE/TPEx
company's business, strategy and finances (short-term, medium-term, Sustainability Roadmap, impending carbon taxes, and supply chain
long-term) decarbonization requirements. While our products are currently exempt
from mandatory carbon pricing, a future carbon tax would lead to higher
production costs.
Medium-term impact: Product raw material costs increase, and the
consumer market shifts to low-carbon products. In the future, the company
will focus on low-carbon reduction control and water-saving processes to
effectively control product costs and win market orders for low-carbon
products.
Long-term impact: The ESG ratings will influence the willingness of
investors and banks to raise funds. Customers’ requirements for ESG and
their innovative ability to develop new low-carbon and low-energy
products have increased. The company will implement ESG governance
and invest in the long-term development of low-carbon products based on
the company’s sustainable business goals. Strive for more business
opportunities.
3. Describe the financial impact of extreme climate events and transition Due to the impact of extreme climate on the average temperature of the
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~ 54 ~

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actions. city, summers are hot, which increases air conditioning energy
consumption and electricity bills. In recent years, as the technology
industry continues to expand factories and increases water demand, there
will be hidden dangers of water shortage. Our company's current process
water demand The volume is not large, but an emergency response plan has
still been established.
4. Describe how climate risk identification, assessment and management After the unit responsible for climate-related risks and opportunities
processes are integrated into the overall risk management system. reviews and approves the priority of risk strategy execution and risk
control, the identification unit convenes a climate risk identification
meeting. Through cross-functional communication, the company evaluates
the impacts of acute and chronic climate change patterns on corporate
operations and value chain activities, based on indicators such as physical
risks, transition risks, and opportunities. Furthermore, the company
explores the risk disasters or opportunities encountered in different regions
to identify the financial impact and applicability of each risk and
opportunity to the Company.
The climate change risk management process has not yet been established.
5. If scenario analysis is used to assess resilience to climate change risks, A scenario analysis evaluation has not yet been used and will be considered
the scenarios, parameters, assumptions, analysis factors and main financial for future development subject to the extent of the impact of climate
impacts used should be described. change on the Company.
6. If there is a transformation plan to manage climate-related risks, describe There is no transformation plan to address climate-related risks at the
the content of the plan, and the indicators and goals used to identify and moment.
manage physical risks and transformation risks.
7. If internal carbon pricing is used as a planning tool, the basis for setting As of now, carbon pricing has not been utilized as a planning tool
the price should be stated. internally, and will be considered in the future based on the evaluation of
the extent of the climate change impacts and relevant regulations.
8. If climate-related goals are set, the activities covered, the scope of No climate-related goals have been set at this time, and consideration will
greenhouse gas emissions, the planning schedule, annual achievement be given to the development of overall climate risks and opportunities in
progress and other information should be explained; if carbon offsets or the future.
renewable energy certificates (RECs) are used to achieve relevant goals, the
information should be explained. Source and quantity of offset carbon
reduction credits or quantity of renewable energy certificates (RECs)
9.Greenhouse gas inventory and assurance, reduction targets, strategies and In accordance with the "Sustainable Development Roadmap" published by
specific action plans (fill in 1-1 and 1-2 separately) the Financial Supervisory Commission in March 2022, the Company is
classified as a TWSE/TPEx listed company with a paid-in capital of less
than NT$5,000 million. The individual companies shall complete the
inventory in 2026 and the verification in 2028, whilst the subsidiaries
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~ 55 ~

within the consolidated statements shall complete the inventory in 2027 and the verification in 2029. The Company will continue to control the implementation of GHG inventory and verification, as well as the disclosure of GHG emissions, in accordance with the guidelines and regulations issued by the competent authorities.

1-1 Company greenhouse gas inventory and confirmation status in the last two years

1-1-1 Greenhouse gas inventory information

Describe the emission volume (metric tons CO2e), intensity (metric tons CO2e/million yuan) and data coverage of greenhouse gases in the past two years.

No inventory has been conducted yet, and the Company is required by the "Sustainable Development Roadmap" to complete an inventory of individual companies by 2026.

1-1-2 Greenhouse Gas Confirmation Information

Describe the confidence situation in the last two years as of the publication date of the annual report, including the scope of the confidence, the organization of the confidence, the criteria for the confidence and the opinion of the confidence.

The Company has not yet conducted the assurance process, and it is required by the "Sustainable Development Roadmap" that the assurance process should be completed by 2028 for individual companies.

1-2 Greenhouse gas reduction goals, strategies and specific action plans

Describe the greenhouse gas reduction base year and its data, reduction targets, strategies, specific action plans and achievement of reduction targets.

The Company has not yet set the base year and data, reduction targets, strategies and concrete action plans, and will establish and implement them in accordance with the "Sustainable Development Roadmap" issued by the Financial Supervisory Commission in March 2022 in a sequential manner.

~ 56 ~

(9) The company's compliance with ethical business practices and measures:

The company has established the "Internal Handling Procedures for Material Non-public Information" and disseminated it to all employees for their compliance and awareness.

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Departure from the Ethical
Disclosure of compliance with the principles of integrity
Operational Status Corporate Management Best
management and differences and reasons from the best practice
Practice Principles for
guidelines for integrity management of listed and OTC
Yes No Summary and Explanation TWSE & TPEx Listed
companies.Item
Companies, and reasons
----- End of picture text -----

1. Formulating Policies and Plans for Ethical Corporate
Management
(1) Has the company established a policy of ethical
management approved by theboard of directors and clearly
stated the policy and practices of ethical management in
regulations and external documents, and has the board of
directors and senior management actively implemented the
commitment to the management policy?
(2) Has the company established a risk assessment mechanism
for dishonest behavior, regularly analyzed and evaluated
business activities with higher risk of dishonest behavior
within its scope of business, and formulated measures to
prevent dishonest behavior, covering at least preventive
measures for each item in Article 7, Paragraph 2 of the
"Code of Conduct for Integrity in Listed and OTC
Companies"?		 v
v		 (1) To promote and advocate for ethical behavior, the
company has established the "Code ofConduct" and
"Ethical Behavior Standards," which are disclosed on
the Public Information Observation System and the
company's website. All employees receive guidance on
the company's core values and compliance with the
system. The company also requires stakeholders who
have business dealings with the company, such as
suppliers and contractors, to adhere to the same ethical
standards as company employees.
(2) In order to ensure the implementation of integrity
practices, the company has established effective
accounting and internal control systems. Internal
auditors regularly assess compliance with these
systems and implement relevant preventive measures
for activities that pose higher risks of dishonest
behavior, as outlined in Article 7, Section 2 of the
"Integrity Practices for Listed Companies and
Over-the-Counter Companies," or other business
activities within the scope of operations. The company
has also formulated the "Internal Handling of Material
Information and Prevention of Insider Trading
Guidelines," "Code of Conduct," and "Ethical
Behavior Standards," which are published on the
company's website for compliance.
Additionally, the company has an internal reporting
system in place for employees and relevant individuals
to report any improper conduct, and designated
managementpersonnel handle such reportspersonally.

























No difference found.

~ 57 ~

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Departure from the Ethical
Disclosure of compliance with the principles of integrity
Operational Status Corporate Management Best
management and differences and reasons from the best practice
Practice Principles for
guidelines for integrity management of listed and OTC
Yes No Summary and Explanation TWSE & TPEx Listed
companies.Item
Companies, and reasons
----- End of picture text -----

(3) Has the company clearly defined operating
procedures, behavioral guidelines, disciplinary
measures for violations, and appeal procedures in its
plan to prevent dishonest behavior, and implemented
and periodically reviewed and revised the
aforementioned plan?		 v (3) To prevent any dishonest behavior, unauthorized
information disclosure, ensure consistency and
accuracy in the company's external
communications, and strengthen the prevention
of insider trading, the company has developed
the "Code of Conduct" and the "Internal
Handling of Material Information and Prevention
of Insider Trading Guidelines." All employees
are required to refrain from engaging in activities
that may involve conflicts of interest or potential
conflicts of interest, and important personnel and
senior executives must regularly report their
compliance with these guidelines. The company
requires suppliers or other collaborators to
refrain from engaging in any illegal business
activities and from providing improper benefits
or bribes to companyemployees.

No difference found.

~ 58 ~

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Departure from the Ethical
Disclosure of compliance with the principles of integrity
Operational Status Corporate Management Best
management and differences and reasons from the best practice
Practice Principles for
guidelines for integrity management of listed and OTC
Yes No Summary and Explanation TWSE & TPEx Listed
companies.Item
Companies, and reasons
----- End of picture text -----

2. Implementation of Ethical Corporate Management
(1) Does the company evaluate the integrity recordsof its
business counterparts and include clauses on ethical
conduct in contracts signed with them?
(2) Has the company established a dedicated unit under
the Board of Directors to promote corporate integrity
and reports regularly (at least once a year) to the
Board of Directors on its integrity management
policy, measures to prevent dishonest behavior, and
the monitoring and implementation status?
(3) Has the company formulated a policy to prevent
conflicts of interest, established appropriate channels
for reporting, and ensured its implementation?
(4) Does the company have effective accounting and
internal control systems in place to implement
corporate integrity, and does the internal audit unit
develop relevant audit plans based on the assessment
of the risk of dishonest behavior, and use them to
verify compliance with anti-dishonesty behavior
plans, or commission accountants to conduct audits?
(5) Does the company regularly conduct internal and
external education and training on ethical corporate
management?
v
v
v
v
v		 (1) The company requires its business counterparts,
such as suppliers or other collaborators, to adhere
to the same ethical standards as the company's
management and employees.
(2) The company's Board of Directors appoints
dedicated managers and internal audit teams to
vigorously promote corporate integrity from
different levels and perspectives. Any abnormal
circumstances will be promptly reported to the
Board of Directors.
(3) The company has an internal reporting system in
place, allowing employees and related
individuals to report any improper professional
conduct, which is then handled personally by
designated management personnel.
(4) The company has designed internal control
systems for operational procedureswith potential
higher risks of dishonest behavior. The internal
audit team implements annual audit plans based
on risk assessments and submits audit reports to
the Board of Directors.
(5) The company's "Code of Conduct" is not only
disclosed in the "Corporate Governance" section
of the company's website but also regularly
communicated within the company to ensure that
every employee understands and complies with
it.


No difference found.

~ 59 ~

Disclosure of compliance with the principles of integrity
management and differences and reasons from the best practice
guidelines for integrity management of listed and OTC
companies.Item
Operational Status
Departure from the Ethical
Corporate ManagementBest
Practice Principles for
TWSE & TPEx Listed
Companies,and reasons
Yes
No
Summary and Explanation		 Disclosure of compliance with the principles of integrity
management and differences and reasons from the best practice
guidelines for integrity management of listed and OTC
companies.Item
Operational Status
Departure from the Ethical
Corporate ManagementBest
Practice Principles for
TWSE & TPEx Listed
Companies,and reasons
Yes
No
Summary and Explanation		 Disclosure of compliance with the principles of integrity
management and differences and reasons from the best practice
guidelines for integrity management of listed and OTC
companies.Item
Operational Status
Departure from the Ethical
Corporate ManagementBest
Practice Principles for
TWSE & TPEx Listed
Companies,and reasons
Yes
No
Summary and Explanation		 Disclosure of compliance with the principles of integrity
management and differences and reasons from the best practice
guidelines for integrity management of listed and OTC
companies.Item
Operational Status
Departure from the Ethical
Corporate ManagementBest
Practice Principles for
TWSE & TPEx Listed
Companies,and reasons
Yes
No
Summary and Explanation		 Disclosure of compliance with the principles of integrity
management and differences and reasons from the best practice
guidelines for integrity management of listed and OTC
companies.Item
Operational Status
Departure from the Ethical
Corporate ManagementBest
Practice Principles for
TWSE & TPEx Listed
Companies,and reasons
Yes
No
Summary and Explanation
3. Implementation of the Company's Whistleblowing
System
(1)Does thecompany have a specific whistleblowing and
reward system, a convenient whistleblowing channel,
and appropriate personnel assigned to handle the
whistleblowing?
(2)Has the company established standard operating
procedures for investigating reported matters,
including the actions to be taken after the
investigation and relevant confidentiality measures?
(3) Does the company take measures to protect the
whistleblower against inappropriate disciplinary
actions?
v
v
v
(1) The company has already established an internal
reporting system that allows employees and
relevant individuals to report any improper
professional conduct. Any behavior that violates
our code of ethics will be strictly disciplined
according to the company's disciplinary
measures, including termination of employment
and legal actions.
(2) In accordance with Article 19 of our "Code of
Conduct," we have established an internal
reporting mechanism that operates based on
confidentiality principles for conducting
investigation procedures.
(3) In accordance with Article 19 of our "Code of
Conduct," we ensure the confidentiality of the
whistleblower's identity and the reported content.
Whistleblowers are protected from any improper
treatment as a result of their reports.
No difference found.
4. Enforcing Information Disclosure
Does the company disclose the content of its integrity
management guidelines and their implementation
effectiveness on its website and the public
information platform?		 v The company places integrity management-related
regulations and promotional information on its
website and internal resources for employees to
access at any time. The annual reports published on
the website provide detailed information on integrity
management.		 No difference found.

~ 60 ~

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|||||
|---|---|---|---|
|Departure from the Ethical|
|Disclosure of compliance with the principles of integrity|
|Operational Status|Corporate Management Best|
|management and differences and reasons from the best practice|
|Practice Principles for|
|guidelines for integrity management of listed and OTC|
|Yes|No|Summary and Explanation|TWSE & TPEx Listed|
|companies.Item|
|Companies, and reasons|
|5. If the company has its own Code of Ethical Corporate Management in accordance with the “Ethical Corporate Management Best Practice Principles|
|for TWSE & TPEx Listed Companies,” please describe any departure from the code in its operation:|
|In addition to the "Integrity Management Guidelines" and "Code of Ethics," the company has also incorporated relevant regulations in its "Work|
|Rules." The company, guided by principles of integrity, transparency, and accountability, establishes sound corporate governance and risk|
|management mechanisms to create a sustainable operating environment.|
|To ensure the effective management of integrity operations, the company has assigned a dedicated unit responsible for policy development,|
|prevention plans, and overseeing their implementation. This unit regularly reports to the board of directors. The company has clearly stated its|
|integrity management policies and practices, as well as the commitment of the board of directors and management to actively implement these|
|policies. There have been no significant deviations from the established guidelines.|
|6.Other important information that helps to understand the operation of the company's business integrity (such as the company's review and revision of|
|its established code of conduct for business integrity, etc.):|
|(1) The company complies with company law, securities trading law, commercial accounting law, relevant regulations for listed and OTC|
|companies, and other applicable business laws and regulations as the basis for implementing integrity management.|
|(2) To establish a robust internal system for processing and disclosing significant information, prevent improper information leakage, ensure|
|consistency and accuracy in external information disclosures, and strengthen the prevention of insider trading, the company has developed the|
|"Internal Handling and Prevention of Insider Trading Management Regulations." These regulations specify the guidelines for directors,|
|executives, and employees in handling significant internal information. The "Code of Ethics" of the company prohibits directors and executives|
|from seeking personal gains through the use of company assets, information, or their positions. Additionally, to ensure the implementation of|
|integrity management, the company has established effective accounting and internal control systems. The internal audit department conducts|
|regular audits to assess compliance with these systems. For business activities that pose a higher risk of dishonest behavior under Article 7,|
|Paragraph 2 of the "Integrity Management Guidelines for Listed and OTC Companies" or within the company's scope of operations, relevant|
|preventive measures have been implemented. In conclusion, the company has implemented the provisions of the "Integrity Management|
|Guidelines for Listed and OTC Companies."|

----- End of picture text -----

(10) Other significant information that enhances understanding of the company's corporate governance practices: None.

~ 61 ~

(11) Continuing Education of Directors and Supervisors for the year 2025:

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----- Start of picture text -----

Date of Study
Job Title Name Organizer Course Name
Education Hours
Chairman Lin, Weng-Teng 2025/10/02 The Institute of Internal Practical Discussion and 6 hours
Auditors-Chinese Mitigation Strategies for
Taiwan "Insider Trading" and
"Financial Statement Fraud."
Director Lin, I-Chin 2025/07/10 Accounting Research Practical Insights into Common 6 hours
and Development Financial Reviews and Essentia
Foundation, Republic Control Compliance.
of China
Director Pan, Hsin-Jen 2025/07/10 Accounting Research Practical Insights into 6 hours
and Development Common Pitfalls in Financial
Foundation, Republic Reviews and Essential Internal
of China Control Compliance.
Director Lin, Jui-Ping 2025/09/04 The Institute of Internal Payroll Cycle Management 6 hours
Auditors-Chinese and the Labor Incident Act
Taiwan from the Perspective of
Corporate Governance.
Director Liu, Nien-Fu 2025/02/26 Accounting Research Practical Internal Audit and 6 hours
and Development Control of Corporate
Foundation, Republic Employee Incentive Programs.
of China
2025/03/06 Accounting Research Navigating Employee Fraud: 6 hours
and Development Legal Responsibilities and
Foundation, Republic Practical Internal Control
of China Insights.
Independent Maa, Kwo-Juh 2025/06/09 Taipei Bar Association. Latest Developments in 3 hours
Director Corporate Governance and the
Responsibilities of Directors,
Supervisors, and Managers.
2025/07/25 National Federation of Materiality Considerations in 3 hours
Certified Public Sustainability Information
Accountants Disclosure.
Associations of the
Republic of China
Independent Lin, Ruey-Tou 2025/10/02 The Institute of Internal Practical Discussion and 6 hours
Director Auditors-Chinese Mitigation Strategies for
Taiwan "Insider Trading" and
"Financial Statement Fraud."
Independent Lee, Shiue-Chen 2025/11/07 Accounting Research Internal Audit and Control 6 hours
Director and Development Essentials for "Sustainability
Foundation, Republic Information Management" and
of China Practical Case Analysis.
Independent Chang, Chia-Jung 2025/11/06 Securities and Futures Criminal Modus Operandi 3 hours
Director Institute Involving Virtual Assets and
Anti-Money Laundering
Measures.
2025/11/20 Securities and Futures 2026 Global and Taiwan 3 hours
Institute Economic Outlook:
Navigating the New Normal.
----- End of picture text -----

(12) Manager's Participation in Governance-Related Training and Education:

Job Title Name Date of
Education		 Organizer Course Name Study
Hours
General
Manager		 Lin,
Weng-Teng		 2025/10/02 The Institute of Internal
Auditors-Chinese Taiwan		 Practical Discussion and
Mitigation Strategies for
"Insider Trading" and		 6 hours

~ 62 ~

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----- Start of picture text -----

"Financial Statement
Fraud."
Corporate Lin, 2025/09/04 The Institute of Internal Payroll Cycle 6 hours
Governance Jui-Ping Auditors-Chinese Taiwan Management and the
Officer Labor Incident Act from
the Perspective of
Corporate Governance.
2025/12/12 The Institute of Internal Must-Know Points: Key 6 hours
Auditors-Chinese Taiwan Considerations and
Impacts of IFRS S1/S2 on
Internal Control and
Internal Audi
2025/12/18 The Institute of Internal Practical Analysis and 6 hours
Auditors-Chinese Taiwan Response Strategies for
Insider Trading and
Financial Statement
Misrepresentation.
(13) Employee Training and Development:
The average training hours per employee in our company for the year 2025 was 7 hours.
The training courses were categorized into three major types, and their execution status is as follows:
Course Categories Shift Total Number Total Training Remarks
of Participants Hours
Financial 3 3 18
Management 10 8 60
Environment, 2 2 12
Health, and Safety
Total 15 13 90
----- End of picture text -----

  • (14) Information on personnel responsible for financial transparency and their relevant licenses as specified by

the competent authority:

mpetent authority:
License Number(personnel holding the
licenses)
Internal
Audit		 Financial
Basic Internal Control Competency
Test
1

(15) Procedures for handling significant information

The company has established procedures related to major information processing operations. The responsible unit will regularly notify relevant peer-level supervisors to remind them whether there is any major information that needs to be disclosed in accordance with the law, and inform them of relevant regulations. In addition, in order to ensure that colleagues and manager-level directors are aware of and comply with relevant regulations, the company has formulated "Insider Trading Prevention Measures." In order to reduce the risk of insider trading, the company regularly conducts education and training for company executives and colleagues, and provides relevant educational and promotional articles to help colleagues understand the relevant regulations.

~ 63 ~

  • (16) Disclosure of the implementation status of internal control system

1. Internal Control Statement

RECTRON LTD. Internal Control System Statement

Date: March 11, 2026

Based on the results of self-assessment, the Company hereby declares the following regarding its internal control system for the year 2025:

  1. It is the responsibility of the Board of Directors and Managers of the Company to establish, implement and maintain the internal control system, which the company has established. The purpose of the system is to achieve the goals of effectiveness and efficiency in operations (including profitability, performance, and safeguarding of assets), reliable reporting with timeliness, transparency, and compliance with relevant regulations and laws, providing reasonable assurance.

  2. The internal control system has its inherent limitation, no matter how perfect the design is, the effective internal control system can only provide reasonable assurance for the above three objectives; moreover, the effectiveness of the internal control system may change with the change of environment and situation. However, the internal control system of the Company is provided with a self-monitoring mechanism, and the company will take corrective actions once the absence is identified.

  3. The Company shall judge whether the design and implementation of the internal control system are effective or not according to the judgment items of the effectiveness of the internal control system stipulated in the "Guidelines for the Establishment of Internal Control System by Public Owned Corporations" (hereinafter referred to as " Handling Guidelines"). The internal control system assessment criteria adopted in the "handling guidelines" are based on the management control process, which divides the internal control system into five components: 1. Control Environment, 2. Risk Assessment, 3. Control Activities, 4. Information and Communication, and 5. Monitoring Activities. Each component includes a number of items. For the foregoing items, please refer to the provisions of "Handling Guidelines".

  4. The Company has adopted the above internal control system assessment criteria to evaluate the effectiveness of the design and implementation of the internal control system.

  5. Based on the assessment results mentioned above, the Company believes that its internal control system as of December 31, 2025 (including the supervision and management of subsidiaries) is effectively designed and implemented to understand the degree of achieving operational effectiveness and efficiency goals, provide reliable, timely, transparent, and compliant reporting, and reasonably ensure the achievement of the aforementioned goals.

  6. This statement will become a major part of the Company's annual report and public disclosure. If any of the contents disclosed above is found to be false, with concealment or other illegal matters, it will involve legal liabilities under Articles 20, 32, 171 and 174 of the Securities and Exchange Act.

  7. This statement has been approved by the Board of Directors of the Company on March 11, 2026. Among the 9 directors present, there were no objections, and all agreed with the content of this statement. This statement is hereby declared.

RECTRON LTD.

Chairperson: Lin,Weng-Teng

General Manager: Lin,Weng-Teng

~ 64 ~

  1. The Company has not commissioned an accountant to conduct a special review of the internal control system: None.

  2. (17) In the most recent fiscal year and up until the date of printing this annual report, there have been no penalties imposed on the Company or its insiders in accordance with the law, and there have been no major deficiencies or improvements related to penalties imposed by the Company on its insiders for violations of internal control system provisions: None.

  3. (18) Important resolutions of the shareholders' meeting and the board of directors for the most recent fiscal year up to the date of printing of the annual report:

  4. 1.Important resolutions and matters discussed at the 2025 regular shareholders’ meeting (May 29, 2025): Attendance: Directors Lin I-Chin, Directors Pan Hsin-Jen and Directors Lin Jui-Ping .

==> picture [453 x 490] intentionally omitted <==

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Acknowledged matter Acknowledge the result Execution situation
(1)2024 annual operating The voting results of this proposal: The resolution has
report and financial Attendance of voting shareholders been fully executed
statements (including 103,816,136 voting rights. according to the
consolidated financial Votes in favor 95,794,735 voting decision
statements) case rights.Votes against 547,646 voting
rights.Invalid votes 0 voting
rights.Abstentions/Not voted 7,473,755
voting rights.
The voting results for this case are as
follows: in favor votes account for
92.27% of the voting rights present at the
shareholders' meeting. The original
proposal is passed according to the voting
results.
(2) The distribution of The voting results of this proposal: The resolution has
earnings for the fiscal Attendance of voting shareholders been fully executed.
year 2024 103,816,136 voting rights. The ex-dividend date
Votes in favor 95,794,704 voting rights. for the distribution has
Votes against 547,646 voting rights. been set as June 23,
Invalid votes 0 voting 2025, and the cash
rights.Abstentions/Not voted 7,473,786 dividend will be
voting rights. distributed on July 11,
The voting results for this case are as 2025.
follows: in favor votes account for
92.27% of the voting rights present at the
shareholders' meeting. The original
proposal is passed according to the voting
results.
Matters for Discussion Result of discussion Result of implement
(1) To Amend Parts of the The voting results of this proposal:
Handled in accordance
Articles of Attendance of voting shareholders
with the revised rules.
Incorporation. 103,816,136 voting rights.
Votes in favor 95,774,685 voting
rights.Votes against 565,696 voting
rights.Invalid votes 0 voting
rights.Abstentions/Not voted 7,475,755
----- End of picture text -----

~ 65 ~

==> picture [453 x 706] intentionally omitted <==

----- Start of picture text -----

voting rights.
The voting results for this case are as
follows: in favor votes account for
99.25% of the voting rights present at the
shareholders' meeting. The original
proposal is passed according to the voting
results.
The voting results of this proposal:
(2)To Amend Regulations on Handled in accordance
Attendance of voting shareholders
Lending Funds to Others. with the revised rules.
103,816,136 voting rights.
Votes in favor 95,731,684 voting
rights.Votes against 606,697 voting
rights.Invalid votes 0 voting
rights.Abstentions/Not voted 7,477,755
voting rights.
The voting results for this case are as
follows: in favor votes account for
92.21% of the voting rights present at the
shareholders' meeting. The original
proposal is passed according to the voting
results.
Election Matters Election Results Result of implement
1. Juiye Enterprise Co., Ltd.
Election of the 20th Board of The matter has been
Representative: Lin, I-Chin Votes
Directors processed and
Received: 95,690,396
completed in
2. Juiye Enterprise Co., Ltd.
accordance with the
Representative:Lin, Weng-Teng Votes
resolution of the
Received: 95,678,866
Shareholders' Meeting.
3. Juiye Enterprise Co., Ltd.
Representative: Pan, Hsin-Jen Votes
Received: 95,678,866
4. Juiye Enterprise Co., Ltd.
Representative: Lin, Jui-Ping Votes
Received: 95,676,654
5. Juiye Enterprise Co., Ltd.
Representative: Liu, Nien-Fu Votes
Received: 95,678,366
6. Independent Director Lin, Ruey-Tou
Votes Received: 95,611,930
7. Independent Director Maa, Kwo-Juh
Votes Received: 95,643,199
8. Independent Director Lee, Shiue-Chen
Votes Received: 95,666,118
9. Independent Director Chang, Chia-Jung
Votes Received: 97,232,055
Other Proposals Voting Results Result of implement
The voting results of this proposal:
Proposal to Release the The matter has been
Attendance of voting shareholders
Non-competition processed and
103,816,136 voting rights.
Restrictions on Newly completed in
Votes in favor 95,915,814 voting
Elected Directors (Including accordance with the
rights.Votes against 363,379 voting
Independent Directors) and resolution of the
rights.Invalid votes 0 voting
Their Representatives. Shareholders' Meeting.
rights.Abstentions/Not voted 7,536,943
voting rights.
----- End of picture text -----

~ 66 ~

The voting results for this case are as follows: in favor votes account for 92.39% of the voting rights present at the shareholders' meeting. The original proposal is passed according to the voting results.

  1. Important resolutions of the board of directors in the most recent year and as of the publication date of the annual report:

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Meeting date Important decisions of the Board of Directors
19th session (1) Approval of the Company's operating report and financial statements for the year
19rd time 2024 are submitted for review.
2025.03.11 (2) Approval of the Company's declaration on internal control system for the year 2024
is submitted for approval.
(3) Approval of the Assessment of the independence of visa accountants and
accountant fees in 2025, proposed for discussion
(4) Approval of the performance evaluation and self-assessment report of the board
members, board of directors, and functional committees for the year 2024 will be
presented for public review
(5) Approval of the Company's proposed participation in the capital increase of its
equity-method investee, CHU-TING ENTERPRISE CO., LTD.
(6) Approval of the Proposal to amend certain articles of the company's "Articles of
Incorporation" for discussion.
(7) Approval of the Proposal for the distribution of profits for the fiscal year 2024 for
discussion.
(8) Approval of the 2024 cash dividend distribution case is proposed for discussion.
(9) Approval of the Proposal for the distribution of employee compensation and
director's remuneration for the fiscal year 2024 is submitted for discussion.
(10) Approval of the Proposal for the Comprehensive Re-election of All Directors
(11) Approval of the Proposed Nomination List of Director (Including Independent
Director) Candidates.
(12) Approval of the Proposal to Exempt Newly Elected Directors (Including
Independent Directors) and Their Representatives from Restrictions on Engaging in
Competitive Activities
(13) Approval of the Proposal to establish matters related to the 2025 Shareholders'
Meeting is submitted for discussion.
(14) Approval of the Proposal to establish the acceptance period and venue for the
submission of proposals and nominations by shareholders holding 1% of the shares
for the 2025 Shareholders' Meeting is submitted for discussion.
19th session (1) Approval of the financial statements for the first quarter of the company's fiscal
20th time year 2025 will be presented for deliberation.
2025.05.14 (2) Approval of amendments to the Company's general principles for the pre-approval
of non-assurance services.
20th session (1) Approval of the election of the Chairman of the Board.
1th time
2025.05.29
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~ 67 ~

20th session
2th time
2025.08.14		 (1) Approval of thefinancial statements for the second quarter of the company's fiscal
year 2025 will be presented for deliberation.
(2) Approval of the proposal to purchase Directors, Supervisors, and Managers'
liability insurance will be submitted to the Board of Directors for retrospective
approval.
(3) Approval of the appointment of Remuneration Committee members.
(4) Approval of the Company’s 100% investment in Shanghai Lizhengda Industrial
Co.,Ltd.
20th session
3st time
2025.11.13		 (1) Approval of the financial statements for the third quarter of 2025 are submitted for
review.
(2) Approval of the 2024 director remuneration distribution case is proposed for
discussion.
(3) Approval of the appointment or dismissal of the General Manager.
(4) Approval of the election of the Chairman of the Board.
20th session
4nd time
2025.12.16		 (1) Approval of the Proposal for the 2026 Operational Plan, to be put to a Shareholder
Vote.
(2) Approval of the proposed audit plan for the fiscal year 2026 is submitted for public
resolution.
(3) Approve of the definition and scope of "Entry-level Employees"
(4) Approval of the Proposed amendment to the Company's "Internal Control System"
and "Internal Audit Implementation Regulations," for deliberation.
20th session
5nd time
2025.03.05		 (1) Approval of the election of an additional Director.
(2) Approval of the Proposal to establish matters related to the 2026 Shareholders'
Meeting is submitted for discussion.
(3) Approval of the Proposal to establish the acceptance period and venue for the
submission of proposals and nominations by shareholders holding 1% of the shares
for the2026 Shareholders' Meetingis submittedfordiscussion.
20th session
6rd time
2026.03.11		 (1) Approval of the Company's operating report and financial statements for the year
2025 are submitted for review.
(2) Approval of the Company's declaration on internal control system for the year 2025
is submitted for approval.
(3) Approval of the Assessment of the independence of visa accountants and
accountant fees in 2026, proposed for discussion
(4) Approval of the performance evaluation and self-assessment report of the board
members, board of directors, and functional committees for the year 2025 will be
presented for public review
(5) Approve of the definition and scope of "Entry-level Employees"
(6) Approve of the director candidate list nominated and reviewed by the Board.
(7) Approval of the Proposal for the distribution of profits for the fiscal year 2025 for
discussion.
(8) Approval of the 2025 cash dividend distribution case is proposed for discussion.
(9) Approval of the Proposal for the distribution of employee compensation and
director's remuneration for the fiscal year 2025 is submitted for discussion.
(10) Approval of the Proposal to Exempt Newly Elected Directors and Their
Representatives from Restrictions on Engagingin Competitive Activities

(19) In the recent fiscal year and up to the printing date of the annual report, there were no dissenting opinions, recorded statements, or written declarations from directors or supervisors regarding significant resolutions passed by the Board of Directors.

~ 68 ~

3. Information on Auditor’s Remuneration

  • (1) Accounting Firm Fee Information Range Table (Please check the applicable range or enter the amount)
Amount unit: NTD in thousands.
Name of the
accountant
Auditor’s review
period
Audit Fees
Non-Audit Fees
Total
Rema
rks
Chih,
Shih-Chin
2025.01.01~2025.12.31
3,080
553
3,633Note
Huang,
Hsin-Ting
2025.01.01~2025.12.31		 Amount unit: NTD in thousands.
Name of the
accountant
Auditor’s review
period
Audit Fees
Non-Audit Fees
Total
Rema
rks
Chih,
Shih-Chin
2025.01.01~2025.12.31
3,080
553
3,633Note
Huang,
Hsin-Ting
2025.01.01~2025.12.31
Name of
accounting
firm		 Name of the
accountant
Auditor’s review
period
Audit Fees
Non-Audit Fees
Total
Rema
rks
KPMG United
Accounting
Firm.		 Chih,
Shih-Chin
2025.01.01~2025.12.31
3,080
553
3,633Note
Huang,
Hsin-Ting
2025.01.01~2025.12.31
Huang,
Hsin-Ting		 2025.01.01~2025.12.31

Note :The non-audit fees include a tax certification fee of 500 thousand NTD, a salary information verification fee of 30 thousand NTD, and business registration fees of 23 thousand NTD.

  • (1) Cases where the non-audit fees paid to the signing accountant, the accounting firm to which the signing accountant belongs, and its affiliated enterprises account for more than one-fourth of the audit fees: None.

  • (2) In the case of changing accounting firms and a decrease in audit fees paid for the current fiscal year compared to the previous fiscal year, the amount and proportion of the decrease in audit fees, as well as the reasons, should be disclosed: None.

  • (3) In the case of a reduction in audit fees of more than 10 percent compared to the previous fiscal year, the amount and proportion of the decrease in audit fees, as well as the reasons, should be disclosed: None.

4.Information on Change of Auditors ： Not applicable.

5. The Chairman, General Manager, or individuals responsible for finance or accounting management of the company who have served in the affiliated firm of the signing auditor or its related entities in the past year: None.

~ 69 ~

6. Changes in the transfer of share ownership and share pledge by directors, supervisors, managers, and shareholders with a stake exceeding 10% during the recent fiscal year and up to the date of printing the annual report.

(1) Changes in the Shareholding of Directors, Supervisors, Managers and Major Shareholders

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For the fiscal year ending on
Year 2025
March 31, 2026.
Increase Increase
Increase Increase (decrease)
Job Title Name (decrease) in (decrease) in
(decrease) in the in the
the the
number of shares number of pledged
number of number of
held. shares
shares held. pledged shares
----- End of picture text -----

o e ame (decrease) in the
number of shares
held.		 in the
number of pledged
shares		 (ecrease) n
the
number of
sharesheld.		 (ecrease) n
the
number of
pledged shares
Director
Independen
t Director
Independen
t Director
Independen
t Director
Independe
nt
Director
Manager
Manager
Manager
Major
sharehold
er		 Juiye Enterprise Co., Ltd.
Representative: Lin,
Weng-Teng
Representative: Lin, I-Chin
Representative: Pan, Hsin-Jen
Representative: Lin, Jui-Ping
Representative: Liu, Nien-Fu
Lin, Ruey-Tou
Maa, Kwo-Juh
Lee, Shiue-Chen
Chang, Chia-Jung
Lin, I-Chin
Lin, Jui-Ping
Liu, Nien-Fu
Bigwig Perfect International
Co., Ltd.		 -
-
-
-
-
-
-
-
-
-
-
-
-		 -
-
-
-
-
-
-
-
-
-
-
-
-
-		 -
-
-
-
-
-
-
-
-
-
-
-
-		 -
-
-
-
-
-
-
-
-
-
-
-
-

(2) Share transfer information: None.

(3) Share pledge information: None.

~ 70 ~

7. Information on related parties or relatives within the second degree of kinship among the top ten shareholders in terms of shareholding percentage:

Information on the relationships among the top ten shareholders in terms of shareholding percentage.

==> picture [483 x 508] intentionally omitted <==

----- Start of picture text -----

The titles or names and
relationships of the top
Total Shares
Shares Held ten shareholders who
Held in the Re
Individual by Spouses are related persons,
Name of ma
hold shares. and Minor spouses, or relatives
Other rks
Children within the second
Persons
degree of kinship.
Name (Note 1)
(Note 3)
Nu
Share Num Share
Shareh mb
holdi ber holdi Name
Number of olding er Relationsh
ng of ng (Or
Shares Ratio of ip
Ratio Shar Ratio Name)
% Sha
% es %
res
Juiye Enterprise Corporate
42,788,288 25.73 - - - - -
Co., Ltd. directors.
Bigwig Perfect
International Co., 38,141,792 22.94 - - - - - -
Ltd
Juyang Xingye
7,505,195 4.51 - - - - - -
Co., Ltd
New Multi
Investment Co., 4,742,000 2.85
Ltd.
Chen, Yu-Chien 3,341,507 2.01 - - - - - -
Chen, Mei-Chen 2,403,264 1.45
Chang,
Kuo-Cheng 2,211,452 1.33
Wang, 1,440,976 0.87
Shih-Hao
Lin, Li-Chun 1,330,000 0.80 - - - - - -
Citibank Ltd. as
Custodian for
Barclays Capital
SBL/PB 1,217,000 0.73 - - - - - -
Investment
Account
----- End of picture text -----

  • Note 1: All top ten shareholders, including corporate shareholders, should be listed, with the names of the corporate shareholders and their representatives listed separately.

  • Note 2: The calculation of shareholding percentage should include shares held under one's own name, as well as those held under the name of one's spouse, minor children, or held by others on one's behalf.

  • Note 3: The disclosure of relationships between the shareholders listed above, including both corporate and natural persons, should be made in accordance with the disclosure requirements of the financial reporting standards for issuers.

~ 71 ~

8. The shares held by the Company, its Directors, Supervisors, managers, and enterprises directly or indirectly controlled by the Company in the same reinvested enterprise, and the comprehensive shareholding ratio calculated on a consolidated basis.

Comprehensive ownership percentage.

As of March 31, 2026 (unit: shares; %)

==> picture [500 x 215] intentionally omitted <==

----- Start of picture text -----

Investments of Directors,
Investments made by Supervisors, Managers and Comprehensive
the company. Businesses Directly or investments.
Investment in other businesses.
Indirectly Controlled
Number of Sharehold Number of Sharehold Number of Sharehold
Shares ing Ratio Shares ing Ratio Shares ing Ratio
Rectron Electronic 205,000 100.00% - - 205,000 100.00%
Enterprise Inc.(USA)
Rectron Electronics (China) 20,000 100.00% - - 20,000 100.00%
Co., Ltd.
CHU-TING ENTERPRISE 20,000,000 100.00% - - 20,000,000 100.00%
CO., LTD.
100.00%
Zhejiang Rectron Electronics 0 0.00% 74,200 100.00% 74,200
Co., Ltd (Note 2) (Note 1) (Note 1)
----- End of picture text -----

  • Note 1: The company, a limited liability company, disclosed its investment amount in thousands of TWD. On November 15, 2024, the company completed a capital reduction registration, reducing its capital by 10,000 thousand USD. The reduction was applied against the original investment amount using the exchange rate of 32.47 on the same day. The funds were remitted to the Company on January 2, 2025, at an exchange rate of 32.865 TWD/USD. Approval from the Investment Commission of the Ministry of Economic Affairs was obtained on May 13, 2025.

  • Note 2: The company has entrusted investment in mainland China companies to Rectron China Investments.

~ 72 ~

3. Funding Status

1. Share Capital and Shares

(1) Source of Share Capital

==> picture [485 x 603] intentionally omitted <==

----- Start of picture text -----

Authorized Capital Paid-In Capital Note
Iss
Year and ue Equity-Settl
month Pri Number of Number of Source of Share ed
Amount Amount Others
ce: Shares Shares Capital Share-Based
Payment
Cash capital increase - -
87.04 10 170,000,000 1,700,000,000 107,219,023 1,072,190,230
600,000,000
Capital increase by - -
retained earnings
107,219,020
Capital reserve to
1999.07.28 10 300,000,000 3,000,000,000 239,384,729 2,393,847,290 capital increase
214,438,040
Cash increase in
capital.
1,000,000,000
Capital increase by - -
retained earnings
98,147,740
Capital reserve to
capital increase
2000.09.21 10 400,000,000 4,000,000,000 277,000,000 2,770,000,000
272,898,590
Employee Bonus
Transferred to
Capital Increase
5,106,380
Capital reduction. - -
2003.11.25 10 400,000,000 4,000,000,000 186,975,000 1,869,750,000
900,250,000
Private placement - -
cash increase in
2005.04.22 10 400,000,000 4,000,000,000 236,975,000 2,369,750,000
capital.
500,000,000
Private placement - -
cash increase in
2006.11.21 10 400,000,000 4,000,000,000 286,975,000 2,869,750,000
capital.
500,000,000
Capital reduction. - -
2007.09.27 10 400,000,000 4,000,000,000 203,178,300 2,031,783,000
837,967,000
Capital reduction. - -
2008.09.20 10 400,000,000 4,000,000,000 148,128,300 1,481,283,000
550,500,000
Private placement - -
cash increase in
2008.12.29 10 400,000,000 4,000,000,000 208,128,300 2,081,283,000
capital.
600,000,000
Capital reduction. - -
2009.10.10 10 400,000,000 4,000,000,000 157,328,300 1,573,283,000
508,000,000
----- End of picture text -----

~ 73 ~

==> picture [487 x 216] intentionally omitted <==

----- Start of picture text -----

Capital increase by
2011.08.27 10 400,000,000 4,000,000,000 160,002,881 1,600,028,810 retained earnings
26,745,810
Capital increase by - -
2014.11.03 10 400,000,000 4,000,000,000 161,302,881 1,613,028,810 retained earnings
13,000,000
Capital increase by
2015.08.27 10 400,000,000 4,000,000,000 166,302,881 1,663,028,810 retained earnings
50,000,000
Approved Capital Stock
Shares
R e m a r k s
Outstanding shares in
Category Unissued shares. Total
circulation.
Common
166,302,881 233,697,119 400,000,000
Share
----- End of picture text -----

Summary declaration system-related information: Not applicable.

(2) Shareholding structure

(2) Shareholding structure (2) Shareholding structure (2) Shareholding structure (2) Shareholding structure (2) Shareholding structure (2) Shareholding structure (2) Shareholding structure
March 24,2026
Shareholder
Structure
Number
Government
institutions.
Financial
institutions.
Other
Corporations Individuals.
Foreign
institutions
and
foreigners.
Total
Number of Persons
1
3
21
20,222
29
20,276
Number of Shares
Held
276
29,469
93,287,709 68,667,427
4,318,000 166,302,881
Shareholding Ratio 0% 0.02% 56.09% 41.29% 2.60% 100%

~ 74 ~

(3) List of Major Shareholders

==> picture [440 x 331] intentionally omitted <==

----- Start of picture text -----

Shares
Percentage of
Name of Major Number of Shares Held
Shareholding%
Shareholders
Juiye Enterprise Co., Ltd. 42,788,288 25.73
Bigwig Perfect International Co., Ltd 38,141,792 22.94
Juyang Xingye Co., Ltd 7,505,195 4.51
New Multi Investment Co., Ltd. 4,742,000 2.85
Chen, Yu-Chien 3,341,507 2.01
Chen, Mei-Chen 2,403,264 1.45
Chang, Kuo-Cheng 2,211,452 1.33
Wang, Shih-Hao 1,440,976 0.87
Lin, Li-Chun 1,330,000 0.80
Citibank Ltd. as Custodian for
1,217,000 0.73
Barclays Capital SBL/PB Investment
Account
----- End of picture text -----

~ 75 ~

(4) Dividends and Distribution Status

  1. The dividend policy of the company is as follows:

In accordance with the company's articles of incorporation, if there is a surplus in the annual financial statements after payment of all taxes and the offsetting of prior-year losses as required by law, ten percent (10%) of the remaining balance shall be allocated to the legal reserve for retained earnings. However, this requirement does not apply when the legal reserve for retained earnings has reached the total capital of the company.

If necessary, the board of directors may propose the allocation of special retained earnings, which are adjusted according to legal requirements or business needs, and retain them accordingly. After considering these factors, any remaining profits can be distributed. The distribution percentages are as follows:

(1)Employee compensation ratio shall not be lower than one percent (1%).

  • (2)Compensation for directors and supervisors shall not exceed two percent (2%).

  • (3)The remaining profits shall be determined by the board of directors and proposed to the shareholders' meeting for approval.

The distribution of employee bonuses in the form of stock dividends may include eligible employees of subsidiary companies, and the allocation ratio shall be determined by the board of directors.

As the company is in a period of growth, considering business expansion, long-term financial planning, and meeting shareholders' demand for cash flow, the annual cash dividend shall not be less than ten percent (10%) of the total amount of cash and stock dividends. The ratio of cash dividends shall be determined by the board of directors and proposed to the shareholders' meeting for approval.

  1. Proposed dividend distribution for the current shareholders' meeting:

The profit distribution for the fiscal year 2025 has been approved by the board of directors on March 11, 2026, with a cash dividend of NT$58,206,008 (NT$ 0.35 per share of free distribution to shareholders). However, it has not yet been approved by the shareholders' general meeting in 2026.

  • (5) The proposed issuance of bonus shares for the current year's shareholders' meeting will have no impact on the company's business performance and earnings per share.

(6) Employee bonuses and director/supervisor remuneration

  1. Information related to employee bonuses and director/supervisor remuneration as stated in the company's articles of incorporation:

  2. If there is a surplus in the annual financial statements, the company shall allocate no less than one percent (1%) as employee compensation and no more than two percent (2%) as compensation for directors and supervisors. However, when the company has accumulated losses, an amount should be reserved in advance for offsetting, and then employee compensation and director/supervisor remuneration should be allocated based on the aforementioned ratios.

  3. Basis for estimating employee bonuses and director/supervisor remuneration for the current period, calculation basis for distributing stock dividends, and accounting treatment in case of differences between the estimated and actual distribution amounts:

  4. If there are changes in the amounts of employee bonuses and director/supervisor remuneration as approved by the shareholders' meeting on profit distribution, the differences should be accounted for as adjustments based on accounting estimates and recognized in the subsequent fiscal year's income statement. This does not affect the financial statements that have already been recognized.

  5. Information regarding proposed employee bonuses approved by the board of directors: (1) Cash dividends of NT$1,200,000 are proposed to be distributed to employees.

~ 76 ~ 

     - Director and supervisor remunerations of NT$2,200,000 are proposed to be distributed. This proposal has been approved by the Board of Directors but is pending approval at the 2026 Shareholders' Meeting.

     - (2) Proposed distribution of employee stock dividends and the proportion to the current period's net income after tax and the total amount of employee dividends:None.

     - (3) Calculation of earnings per share after considering the proposed distribution of employee dividends and director and supervisor remunerations:None..

  4. Distribution of retained earnings from the previous year for employee dividends and director and supervisor remunerations (including the number of shares distributed, amounts, and share prices), any differences with recognized employee dividends and director and supervisor remunerations should be disclosed, along with the reasons and handling: There is no difference between the distribution of retained earnings from the previous year by the company and the proposed distribution approved by the Board of Directors.
  • (7) Share repurchases by the company: As of now, the company has not repurchased any of its own shares.

2. Bond Issuance by the Company: As of now, the company has not issued any corporate bonds.

3. Preferred Shares Issuance by the Company : As of now, the company has not issued any preferred shares.

4. American Depositary Receipts (ADRs) Issuance by the Company: As of now, the company has not issued any ADRs.

5. Employee Stock Options Issuance by the Company: As of now, the company has not issued any employee stock options.

6. Accumulated information until the printing date of the annual report regarding managers who obtained employee stock options and the top ten employees in terms of the number of stock options exercisable, including their names, acquisition details, and exercise status: Not applicable.

7. Restricted Employee Stock Issuance by the Company: As of now, the company has not issued any restricted employee stocks.

8. Accumulated information until the printing date of the annual report regarding managers who obtained restricted employee stocks and the top ten employees in terms of the number of shares acquired, including their names and acquisition status: Not applicable.

9. Issuance of New Shares in Merger or Acquisition of Other Companies: As of now, the company has not conducted any mergers or acquisitions that involved the issuance of new shares.

10. Execution Status of Fund Utilization Plan: None.

~ 77 ~

4. Operation Overview

1. Business Contents

  • (I) Business Scope ：

  • (A) The main business activities of the company are as follows:

    • （ 1 ） CC01080 Electronic components manufacturing.

    • （ 2 ） F119010 Wholesale of electronic materials.

    • （ 3 ） F219010 Electronic materials retail.

    • （ 4 ） F113030 Wholesale of precision instruments.

    • （ 5 ） F213040 Retail of precision instruments.

    • （ 6 ） F401010 International trade.

    • （ 7 ） I301010 Information software services.

    • （ 8 ） I301020 Data processing services.

    • （ 9 ） I301030 Electronic information supply services.

    • （ 10 ） F118010 Wholesale of computer software.

    • （ 11 ） F218010 Retail of information software.

    • （ 12 ） E605010 Computer equipment installation.

    • （ 13 ） E604010 Mechanical installation.

    • （ 14 ） CC01060 Wired communication equipment manufacturing.

    • （ 15 ） F113020 Wholesale of electrical appliances.

    • （ 16 ） F213010 Retail of electrical appliances.

    • （ 17 ） F113070 Wholesale of telecommunications equipment.

    • （ 18 ） F213060 Retail of telecommunications equipment.

    • （ 19 ） H701010 Residential and commercial property development and leasing.

    • （ 20 ） H701020 Industrial factory development and leasing.

    • （ 21 ） H701040 Specialized zone development.

    • （ 22 ） H701050 Investment in public infrastructure construction.

    • （ 23 ） I102010 Investment consulting.

    • （ 24 ） I103060 Management consulting.

    • （ 25 ） CB01030 Pollution control equipment manufacturing.

    • （ 26 ） F113100 Wholesale of pollution control equipment.

    • （ 27 ） F213100 Retail of pollution control equipment.

    • （ 28 ） J101030 Waste removal.

    • （ 29 ） J101040 Waste disposal.

    • （ 30 ） J101060 Waste (wastewater) treatment.

    • （ 31 ） J101090 Waste cleaning.

    • （ 32 ） CD01030 Automobile and its components manufacturing.

    • （ 33 ） F114030 Wholesale of automobile and motorcycle parts.

    • （ 34 ） F214030 Retail of automobile and motorcycle parts.

    • （ 35 ） J901020 General hotel industry.

    • （ 36 ） F501030 Beverage shops.

    • （ 37 ） F501060 Restaurant industry.

    • （ 38 ） F104110 Wholesale of textiles, clothing, shoes, hats, umbrellas, and fashion accessories.

    • （ 39 ） F204110 Retail of textiles, clothing, shoes, hats, umbrellas, and fashion accessories.

    • （ 40 ） F105050 Wholesale of furniture, bedding, kitchenware, and decorative items.

    • （ 41 ） F205040 Retail of furniture, bedding, kitchenware, and decorative items.

    • （ 42 ） F109070 Wholesale of educational, musical instruments, and recreational products.

    • （ 43 ） F209060 Retail of educational, musical instruments, and recreational products.

~ 78 ~

  • （ 44 ） F111090 Wholesale of building materials.

  • （ 45 ） F211010 Retail of building materials.

（ 46 ） E801010 Interior decorating.

（ 47 ） I503010 Landscape and interior design.

（ 48 ） ZZ99999 Permitted activities not restricted or prohibited by law.

  • (B) The revenue distribution of the company for the year 2025 is as follows: Semiconductors account for 95.63%, Medical Equipment accounts for 0.98%, and Other sectors account for 3.39%.

(C) The current product lineup of the company includes:

  1. Rectifiers:

  2. (1) Bridge rectifiers

  3. (2) Fast recovery bridge rectifiers

(3) High-efficiency fast recovery bridge rectifiers

(4) Schottky rectifiers

(5) High-voltage Schottky rectifiers

(6) Low forward voltage drop Schottky rectifiers

(7) High-temperature (H Type) Schottky rectifiers

(8) Diode rectifiers

(9) Fast rectifiers

(10) High-efficiency rectifiers

(11) Ultra-high-efficiency rectifiers

(12) TVS transient voltage suppressors

(13) High-voltage (>220V) TVS transient voltage suppressors

(14) Low-voltage (<10V) TVS transient voltage suppressors

(15) Zener Diodes

(16) Surface-Mount Diode

(17) Fast Surface-Mount Diode

(18) High-Efficiency Surface-Mount Diode

(19) Ultra-High Efficiency Surface-Mount Diode

(20) Schottky Surface-Mount Rectifier

(21) High-Efficiency, Fast-Recovery, Low-Loss Bridge Rectifier (Mixed Assembly)

(22) High-Voltage Silicon Stack (10KV–16KV)

  • (23) Automotive 5000W–8000W Load Dump Diode

  • Transistor Field:

    • (1)Power transistors

    • (2)Trench Metal-Oxide-Semiconductor Field-Effect Transistor (Trench MOSFET)

    • (3)Super-Junction Metal-Oxide-Semiconductor Field-Effect Transistor (Super-Junction MOSFET)

    • (4)Metal-Oxide-Semiconductor Field-Effect Transistor (MOSFET) for Automotive Applications

  • Small Signal Products:

~ 79 ~

(1) ESD (Electrostatic Discharge) protection devices

(2) Schottky Diodes

  • (3) Switching Diodes

  • (4) Zener Diodes

  • Third-generation semiconductors:

  • (1) Silicon Carbide (SiC) Schottky 650V-1200V

(2) Silicon Carbide (SiC) MOSFET 650V-1200V

  • (D) Future Research and Development Plans

(1) Low-loss Schottky wafer with a high groove structure.

  • (2) High voltage (>300V) trench Schottky wafer.

  • (3) High voltage (200V-500V) transient voltage suppressor wafer.

(4) Low voltage (<5V) transient voltage suppressor wafer.

  • (5) High voltage (1700V) SiC Schottky wafer.

  • (6) Planar Process Lead-Free Wafer Development.

  • (7) Low Vf Lead-Free Process Series Bridge Rectifiers.

(8) 3D Structure Combination of Different Characteristics Die Packaging Development.

(9) High-Voltage, Low-Loss, Ultra-Fast Recovery Bridge Rectifier

  • (2) Sector Overview:

  • (A) Current Industry Status and Development:

Driven by the demand from different application fields, semiconductor devices have since been divided into two major branches and developed rapidly: one is the microelectronic devices represented by integrated circuits (ICs), characterized by low power and high density, mainly used for information detection, transmission, and processing; the other is the power electronics devices, which are characterized by high power and high reliability, primarily responsible for energy control and conversion.

The application areas of power semiconductor products are extremely wide. With the trend of highly integrated electronic product functions, a single product often needs to have multiple functions, and each function requires an independent power source to provide specific voltage or current. As a result, the demand for power conversion is increasing, and this key technology relies on power semiconductors to achieve it.

Power devices, which combine energy conversion and circuit control functions, are core components in energy processing systems, with the characteristic of "controlling large power operations with small power." As the electrification and automation of automobiles advance rapidly, the demand for power devices continues to grow, especially in the high-voltage and high-current product sectors, where the market demand increase is even more significant. The structure of the power semiconductor industry is highly similar to that of the IC industry, covering the entire process from product specification design, wafer manufacturing, to component packaging. Mainstream international power semiconductor manufacturers are mostly IDM (Integrated Device Manufacturer) models, which integrate design, manufacturing, and packaging.

~ 80 ~

Taiwanese manufacturers also mainly follow the IDM model, with some adopting Fabless (focused on design) or specialized wafer foundry and packaging outsourcing models.

Currently, most domestic MOSFET manufacturers focus on component design, with manufacturing outsourced to specialized wafer foundry companies; diode manufacturers, due to simpler manufacturing processes, mostly operate under their own manufacturing with a complete IDM model. Taiwanese wafer foundries, in addition to serving local clients, also undertake foundry services for foreign power semiconductor giants such as IGBT and other high-end products due to their advantages in process technology, becoming an important development opportunity for Taiwan in the global power semiconductor market.

  • (B) Interrelationships among Upstream, Midstream, and Downstream in the Industry:

The structure of the discrete component industry can generally be divided into three major parts: upstream raw material supply, midstream wafer manufacturing and packaging/testing, and downstream application sectors.

In terms of upstream raw material supply, the main materials include wafers/epitaxial wafers, precious metals, non-ferrous metals, aluminum alloys, and various non-metallic materials. Among these, Taiwan is partially self-sufficient in wafer/epitaxial wafer production, but relies on imports for precious metals like gold, silver, platinum, and certain non-ferrous metals. Key domestic suppliers of wafer materials and diffusion materials include companies such as Zhongmei Silicon and Jiajing.

The midstream industry focuses on wafer manufacturing and packaging/testing, encompassing wafer production, packaging technology, and finished product testing. As the industry structure evolves, some midstream companies are actively extending upstream, investing in wafer technology research and development and manufacturing to move toward vertical integration and enhance overall competitiveness.

The downstream application sectors are extremely diverse, covering industries such as information technology, communications, consumer electronics, machine tools, automotive electronics, office equipment, AI intelligent devices, and solar energy. The market size is enormous, and application demands continue to expand, driving the growth momentum of the entire industry chain.

  • (C) Product Development Trends:

In recent years, diode components have shown a polarized development trend: in high voltage and current application fields, such as electromechanical equipment and other products, high-power components with high voltage withstand capabilities are still required for voltage regulation and rectification. On the other hand, in the field of electronic information products, there is a demand for smaller, more precise diode components for circuit protection. In response to different usage scenarios, various types of diodes continue to maintain stable market demand.

In terms of production technology, the functionality and electrical characteristics of discrete components are determined at the wafer manufacturing stage. Therefore, the product characteristics are closely tied to the wafer processing. To enhance competitiveness, major manufacturers are actively promoting upstream process integration, extending from traditional

~ 81 ~

component manufacturing to wafer diffusion and epitaxial processes. This not only helps reduce raw material costs but also allows for flexible adjustment of wafer electrical properties according to different product requirements, improving production flexibility and efficiency.

Regarding packaging technology, diode products are evolving from traditional axial packaging (Axial), power packaging (TO type), and bridge packaging (Bridge) to smaller surface-mount device (SMD) packaging. Currently, SMD packaging has become the mainstream in the market and holds the highest growth potential. It is further advancing toward even smaller DFN packaging and multi-die composite packaging technologies.

At the product technology level, the market is gradually progressing from general standard products to high-voltage, fast-switching, and Schottky (Schottky) high-power rectifier diodes. Simultaneously, with the increasing application of MOSFETs, there will be continued development of high-end power devices such as MOSFETs, IGBTs, and Silicon Carbide (SiC) to meet the strong demand for high-performance power management in emerging markets.

(D) Competitive Situation:

Although the number of domestic manufacturers engaged in diode production is not large, the overall industry development has matured, with most companies having moved their later-stage assembly processes to mainland China. As China's self-manufacturing capabilities improve year by year, market competition has become increasingly intense. In response to the competitive pressure, the industry generally adopts strategies focused on reducing production costs and expanding market share to achieve economies of scale. This approach aims to strengthen market competitiveness and enhance profitability.

  • (3) Technology and R&D Overview ：

  • Research and development expenses are as follow:

Unit: NTD in thousands

logy and R&D Overview：
arch and development expenses are as follow:
Unit: NTD in thousands		 logy and R&D Overview：
arch and development expenses are as follow:
Unit: NTD in thousands		 logy and R&D Overview：
arch and development expenses are as follow:
Unit: NTD in thousands
Fiscal Year
Year 2025
2026Q1
Explanation Consolidated
financial reports
Consolidated financial
reports
Research and
development expenses		 5,884
1,377
Net operatingrevenue 845,768
216,325
Proportion of net
operatingrevenue		 0.70% 0.64%

2. Successful technology or product developments:

In response to the global demand for electronic products, diodes/transistors, as fundamental electronic components, have a steady demand. The company continues to upgrade its automated equipment to increase production capacity in line with business orders. Additionally, the company focuses on enhancing competitiveness in high-end markets by dedicating efforts to the research and production of related components for smart mobile phone power applications and new energy vehicle battery management systems. This has led to the company's leading position in the market. The following are the summarizations of the successful new products and technologies developed in the past two years:

~ 82 ~

  1. General Purpose Diodes.

  2. Fast Recovery Diodes.

  3. Bridge Rectifiers.

    • (1) Establishment of RSM fully automated production line.

    • (2) Establishment of RBU fully automated production line.

  4. Ultra Small Surface Mount Bridge Rectifiers (MINI-BRIDGES). DIP Bridge ULBF610 (Bridge Rectifier).

  5. Schottky Diodes.

    • (1) LOW VF Schottky products.

    • (2) 150V High Voltage Schottky products.

    • (3) 200V High Voltage Schottky products.

    • (4) MBR series Schottky products.

    • (5) High Current Schottky products.

    • (6) Mass production of Schottky with reduced grain size.

    • (7) Low-loss Schottky products.

    • (8) Low VF 100/120V Schottky products.

    • (9) Low VF 150/200V Schottky products.

    • (10) High Temperature (High Tj Type) Schottky products.

    • (11) Trench Low VF 60V Schottky products.

    • (12) Trench Low VF 45V Schottky products.

    • (13) 0.5A 30V Schottky wafer.

  6. High Voltage Rectifiers.

  7. Electrostatic Protection Devices.

  8. High-Efficiency Recovery Diodes and Ultra-Fast Recovery Diodes. STD GPP/SF (EPI) 200V 3A products with reduced grain size.

  9. Full series Transient Voltage Suppressors (T.V.S) TVS diodes. Transient Voltage Suppressors of 5KW and above.

  10. Surface Mount Devices (SMD)

  11. High Power Surface Mount Devices TO252, TO263.

  12. Insulated High Power Rectifiers (IT0-220).

  13. 0.5 and 1 Watts SMA Zener Diodes.

  14. 600V-800V Metal-Oxide-Semiconductor Field-Effect Transistors.

  15. 20~300V SGT Mosfet.

  16. High-Efficiency, Fast-Recovery, Low-Loss Bridge Rectifier (Mixed Assembly)

  17. Automotive 5000W–8000W Load Dump Diode

  18. (4) Long-term and short-term business development plans:

As part of the short-term development plan, the company will continue to drive production

~ 83 ~

automation, focusing on refining existing processes to improve yield, reduce production costs, and enhance product competitiveness.

In the long term, the company aims to develop high-value products such as MOFET/SiC/ESD protection as part of its business expansion strategy. This includes offering customers a wider range of choices and superior product quality and services to effectively expand the company's arket share.

2. Market and production/sales overview.

(1) Market Analysis

1. Product Sales Regions (Consolidated for 2025)

In 2025, our company's product line focused on diode rectifiers, making the Asian region the highest in terms of sales structure.

==> picture [352 x 88] intentionally omitted <==

----- Start of picture text -----

Region Amount (in thousand NTD) Percentage (%)
Taiwan 41,880 4.95
United States 89,535 10.59
Asia 702,122 83.02
Europe 11,450 1.35
Other countries 781 0.09
----- End of picture text -----

2. Major Competitors

In recent years, the company has continued to improve its technological capabilities and optimize product specifications, clearly positioning its main competitors according to product categories. For small-signal products, the primary competitors are ONSEMI and ROHM; for mid-to-high power products, Infineon and Vishay are the main competitors. The company's products achieve over 80% functionality matching and compatibility, which effectively optimizes customers' component selection, enhances the overall cost-performance ratio, and strengthens market competitiveness.

3. Market Supply and Demand Outlook and Business Objectives

As the pandemic eased in 2023 and regions around the world gradually reopened, coupled with uncertainties such as the Russia–Ukraine war and the U.S.–Iran conflict in 2026, which drove up global energy and material prices, global consumption patterns and the overall economic environment have undergone adjustments. At the same time, surging demand for AI has led wafer fabs to operate at full capacity, resulting in extended lead times and rising costs. This has caused overall market disruptions, with the semiconductor market heavily concentrated on AI, while growth momentum in other segments has slowed.

Starting from 2026, as the market gradually recovers, the effect of advance ordering driven by rising raw material prices, along with an increase in urgent customer orders, is expected to boost market demand and contribute positively to overall revenue. Meanwhile, as the U.S.–China trade war and geopolitical competition among major powers intensify, the global trend of

“de-Chinaization” in exports and international branding is accelerating. This is prompting manufacturers to relocate to emerging Asia-Pacific regions and encouraging the return of

~ 84 ~

Taiwanese businesses. China’s position as the “world’s factory” has weakened, while Southeast Asia and India are gradually increasing their roles in the global semiconductor supply chain.

The Company’s products are fundamental semiconductor discrete devices with a wide range of applications, including home appliances, telecommunications, audio-visual equipment, computers, multimedia, new energy vehicles, photovoltaic energy storage, and 5G. The market outlook remains promising. In recent years, the Company has also actively expanded into the new energy vehicle and electric scooter markets, while investing in AI-related applications, which is expected to continue driving revenue growth.

  1. Favorable and unfavorable factors for future development and corresponding strategies: Favorable factors:

  2. (1) The company has deeply cultivated sales channels in Europe, the United States, and Asia for many years, establishing a complete sales team and agency system. This enables the company to effectively diversify its revenue distribution and reduce market risks.

  3. (2) With the rising awareness of renewable energy applications and the widespread adoption of new energy vehicles, the company can leverage its existing channels to expand its market presence and drive sales growth.

  4. (3) The successful introduction of international major brand clients has further enhanced brand trust and attracted similar clients to adopt the company's products.

Unfavorable factors:

  • (1) Market volatility and disorder have led to intensified price competition. On one hand, customers demand very short lead times; on the other, pricing has become the primary consideration. As a result, greater resources must be invested in marketing and customer relationship management, and the payback period for such investments has lengthened.

  • (2) Rising raw material prices, inflation, and exchange rate fluctuations have increased costs and added uncertainty to delivery schedules.

  • (3) The U.S.–China trade war has affected export markets and the procurement strategies of international brand customers. The Company has actively adjusted its manufacturing footprint; however, the domestic China market is also strengthening localization requirements, which must be addressed simultaneously, leading to more diversified resource allocation.

  • Countermeasures:

  • (1) Actively develop high-profit, high-technology threshold products to avoid falling into the low-price competition market.

  • (2) Continuously invest in the development of high-specification products, targeting the new energy, AI, and high-end application markets.

  • (3) Strengthen cooperation with supply chain partners to ensure stable supply, enhance customer satisfaction, and improve customer loyalty.

==> picture [496 x 55] intentionally omitted <==

~ 85 ~

  • (2) Major product applications and production processes

  • (1) Major product applications:

The company's main products are used in household appliances, communication devices, computers, and new energy vehicles.

  • (2) Production processes:

==> picture [356 x 567] intentionally omitted <==

  • (3) Main Raw Material Supply Situation

The main materials used in the production of our company's power semiconductor devices are non-special components. We maintain good technical cooperation and long-term business relationships with our suppliers, ensuring a high level of supply stability.

~ 86 ~

  • (4) Customer Names and Purchase (or Sales) Amounts for any Year in the Past Two Years that Accounted for more than 10% of the Total Purchase (or Sales) Amount, and Explanation of the Changes. Due to contractual agreements and the confidentiality of customer names and transaction parties, especially when they involve individuals who are not related parties, they will be represented by code names.

1. Key suppliers in the recent two years

Unit: NTD in thousands

==> picture [481 x 195] intentionally omitted <==

----- Start of picture text -----

Year 2024 Year 2025 As of the fiscal year ending on
March 31, 2026(unaudited figures)
Item Name Amount Percentage Relation Name Amount Percenta Relation Name Amount Percentag Relation
of net to the ge of net to the e of the to the
purchase issuer purchase issuer net issuer
amount for amount purchase
the full for the of the
year. (%) full year. current
(%) fiscal
year(%)
1 Z35 50,800 14 Note 1 Z35 80,837 17 Note 1 Z35 29,618 24 Note 1
2 T11 40,493 11 Note 1 Z30 52,281 11 Note 1 Z30 21,551 17 Note 1
3 Z30 39,459 11 Note 1 T11 50,723 11 Note 1
Others 244,636 64 Note 1 Others 279,752 61 Note 1 Others 73,265 59 Note 1
Net Net Net
Total 375,388 100 463,593 100 124,434 100
purchase purchase purchase
----- End of picture text -----

Note 1: Non-related persons

Note 2: Reasons for Changes in the List of Major Purchasing Customers in the Last Two Years: This is mainly because certain electronics companies have adjusted their procurement volumes based on delivery performance, product quality, and pricing. In order to meet the timeliness requirements of customer orders, they have gradually shifted their purchases to suppliers offering better lead times and quality.

  1. Key customers in the recent two years

Unit: NTD in thousands

==> picture [480 x 238] intentionally omitted <==

----- Start of picture text -----

Year 2024 Year 2025 As of March 31, 2026(unaudited
figures)
Item Name Amount Percentage Relation Name Amount Percentage Relation Name Amount Sales-to-Net Relation
of the net to the of the net to the Sales Ratio to the
sales of the issuer sales of the issuer for the issuer
year(%) year(%) period
ending the
previous
quarter of
the current
fiscal year
(%).
1 T21 115,159 15 Note 1 T14 184,440 22 Note 1 T14 30,544 14 Note 1
2 T14 80,649 11 Note 1 T21 112,148 13 Note 1 T21 29,985 14 Note 1
3 T18 72,020 10 Note 1 Note 1 T24 28,323 13 Note 1
4 T25 27,225 13 Note 1
Others 489,629 64 Note 1 Others 549,180 65 Note 1 Others 100,248 46 Note 1
Total Net Net Net
sales 757,457 100 sales 845,768 100 sales 216,325 100
----- End of picture text -----

~ 87 ~

Note 1: Non-related persons

  • Note 2: Reasons for the changes in the list of major customers in the past two years: There have been no significant changes among the major customers, mostly variations in their sales rankings.

3. Number of employees in the company.

Employee Information for the Recent Two Years Up to the Publication Date of This Annual Report

March31,2026 March31,2026 March31,2026 March31,2026
Year
Year 2024
Year 2025
As of the end of the
current fiscal year
March 31, 2026
Num
b f
Staff Members
94 persons
99 persons
95 persons
er o
Empl
Total Workforce
49 persons
47 persons
46 persons
oyees Total
143 persons
146 persons
141 persons
Average age
48years old
50years old
50 years old
Average years
of service
14 years
16 years
17 years
Educ
ation
al
attain		 Doctorate
0 persons
0 persons
0 persons
Master's degree
2 persons
2 persons
2 persons
College degree
59 persons
65 persons
66 persons
ment
dii		 High school
54 persons
54 persons
53 persons
str
butio
n
Ratio		 Below high school 28 persons 24 persons 23 persons

4. Environmental expenditure information

  • (1) The Company’s factory is located in the Tucheng Industrial Zone in New Taipei City. In addition to paying wastewater treatment fees on a monthly basis and air pollution fees on a quarterly basis, the Company complies with environmental regulations by implementing relevant environmental protection measures to prevent pollution.

  • (2) In response to the requirements of the European Union's environmental directive (ROHS), the company adopts green design, green management, green manufacturing management, and green marketing management. The company actively requests that the raw materials supplied by its suppliers comply with ROHS regulations, enabling the smooth export of products to the European region.

  • (3) In the past two years, the company has not incurred any losses or disposals due to environmental pollution.

~ 88 ~

5. Labor-Management Relations

  1. List of employee welfare measures, training and development programs, retirement system, and their implementation, as well as the agreements and measures for safeguarding employee rights.

  2. (1) Employee welfare measures include

  3. (a) Group insurance, accident insurance, and medical insurance.

  4. (b) Subsidies for marriage, funeral, and joyous occasions.

  5. (c) Annual company trips.

  6. (d) Bonuses during major festivals.

  7. (e) Retirement benefits system.

  8. (2) Employee training and development

The company organizes periodic external training programs to enhance employees' skills, knowledge, and work efficiency. The effectiveness of education and training is assessed and included in the performance evaluation criteria.

  • (3) Retirement system and its implementation:

To ensure stable post-retirement lives for our employees, our company has established a labor retirement policy in accordance with the law. We have also set up a Labor Retirement Reserve Supervisory Committee, which regularly allocates retirement reserves to the "Labor Retirement Reserve Fund" account at the Taiwan Bank, based on a fixed ratio of the total payroll expenses. This is done to safeguard the rights of our employees. Starting from July 1, 2005, we have also adopted the government's new retirement policy, whereby a monthly contribution of 6% of the employee's total wages is made to the employee's individual retirement account. For employees who voluntarily contribute to their retirement funds, an additional amount is deducted from their monthly salary based on their voluntary contribution rate, which is then remitted to the Bureau of Labor Insurance's individual retirement account.

(4) Agreements between labor and management and measures for safeguarding employee rights: The company has established legal provisions for working conditions and has implemented systems such as work rules. In addition to complying with the Labor Standards Act to protect employees' rights at work, there is a mechanism for resolving labor disputes. As a result, the labor-management relationship in the company has always been harmonious, and there have been no labor disputes. The employees have a strong sense of belonging and there are no issues regarding labor disputes. Furthermore, the company maintains open channels of communication through autonomous management within the organization. Regular employee trips are organized externally to alleviate work-related stress and fatigue.

  1. Specify the losses incurred due to labor disputes in the most recent fiscal year and up to the date of the annual report's printing, and disclose the estimated amounts and strategies to address current and potential future losses: None.

~ 89 ~

6. Information on information technology and cybersecurity management.

1. Information Security Organization:

The company has established a cross-departmental task force called the "Information Security Management Team." The team is led by the Vice President of Administration and is responsible for planning and executing the company's information security initiatives. They also develop measures for information security management, crisis reporting, and emergency response.

2. Information Security Policy:

The company's information security policy is to "maintain the confidentiality, integrity, availability, and legality of the company's information, and to prevent unauthorized use, disclosure, alteration, destruction, or loss of assets in the event of human error, intentional sabotage, or natural disasters, which could impact the company's operations or compromise its interests."

In addition to adhering to the requirements of the information security policy, the company regularly conducts information security awareness programs and provides employee training.

3. Risk Control for Information Security:

With rapidly evolving cyber-attack techniques, it is impossible to completely avoid paralyzing network attacks from any third party. Network attacks can occur through methods such as email phishing, network spoofing, or brute force attacks, resulting in the introduction of malicious programs into the company's internal network for disruption or data theft. Disruptive attacks can lead to operational interruptions, while data theft attacks can result in the leakage of important operational data or personal information of employees and customers.

The company actively plans and implements information security measures to continuously improve the information security environment and reduce information security risks. In terms of management, relevant management standards are established in areas such as policy and system, organizational responsibilities, manpower security, document control, asset management, communication and operation management, access control, physical environment, system development and maintenance, business continuity management, security incident management, and regulatory compliance. On the technical side, various measures are deployed, including network firewalls, intrusion detection systems, email security systems, automated detection and updating of operating systems, virus protection systems, network access systems, security monitoring systems, and vulnerability scanning systems. Internal auditors and organizations conduct annual audits of the company's information security management system. The security operations, risk control, and incident improvements are reviewed annually and reported to the Information Security Committee to control and reduce information security risks.

4. Employee Information Security Training:

Basic information security education and training are provided to new employees upon their onboarding. Regular information security education and training are conducted for employees to

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enhance their awareness of information security. Internal information audit findings are addressed through immediate information security controls and preventive measures to minimize the risk of employees leaking confidential information about the company and its clients. In the event of external information security incidents, timely information security notifications are issued to strengthen the company's information security maturity and raise employee awareness of defending against external malicious attacks. These measures provide information security assurance for the company's production and operational activities.

  1. In 2025, no significant network attacks that impacted the company's operations occurred.

  2. Management Measures:

Our company places great importance on the field of information security and is committed to building a comprehensive defense architecture to ensure the confidentiality, integrity, and availability of company, customer, and supplier data.

  • (1) Network protection includes the deployment of firewalls for multi-layered isolation and protection.

  • (2) Access control is implemented through permission management and various authentication methods.

  • (3) Each endpoint is required to install antivirus software for virus defense and early warning.

The company will take a more proactive approach in terms of information security strategy, incident response mechanisms, and technical infrastructure to assess the exposure level of information security risks and plan appropriate insurance measures to ensure optimal control of information security risks.

In the most recent fiscal year and up to the date of printing of the annual report, there have been no significant losses, potential impacts, or necessary measures resulting from major information and communication security incidents: The company has not been affected by any significant information and communication security incidents that would impact its operations in the most recent fiscal year up to the date of printing of the annual report.

7. Key contracts and agreements.

Type of
contract
Parties involved
Contract start
and end date
Key content
Restrictio
ns		 Type of
contract
Parties involved
Contract start
and end date
Key content
Restrictio
ns		 Type of
contract
Parties involved
Contract start
and end date
Key content
Restrictio
ns		 Type of
contract
Parties involved
Contract start
and end date
Key content
Restrictio
ns		 Type of
contract
Parties involved
Contract start
and end date
Key content
Restrictio
ns
Financing
agreement
Hua Nan Commercial Bank,
Nansongshan Branch
2025.09-2026.09 Financing borrowings
None
Financing
agreement
First Commercial Bank, Tatung
Branch
2025.08-2026.08 Financing borrowings
None
Sales and
Purchase
Agreement		 Jiashan Economic Development
Asset Management Co., Ltd.
2023.09		 Agreement on Land and Factory
Withdrawal for Zhejiang Rectron
None

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5 . Review Analysis and Risk Assessment of Financial Status and Financial Performance

1. Financial Status

  • (1) Comparative Analysis of Changes in Consolidated Assets, Liabilities, and Shareholders' Equity for the Past Two Years.

Unit: NTD in thousands

==> picture [489 x 373] intentionally omitted <==

----- Start of picture text -----

Change in the
proportion of
Difference
increase and
Year decrease
Year 2024 Year 2025
Analysis
Amount % Description
Item (Note)
Current asset 979,725 1,022,283 42,558 4.34
Property, plant, and 579,332 -56,458 -8.88
635,790
equipment
Intangible Assets 0 0 0 0.00
Other Assets 1,027,911 1,002,774 -25,137 -2.45
Other non-current assets 2,357 1,751 -606 -25.71
Total Assets 2,645,783 2,606,140 -39,643 -1.50
Current Liability 735,239 724,922 -10,317 -1.40
Deferred income tax 66,881 -320 -0.48
67,201
liabilities
Other non-current 6,183 -3,124 -33.57
9,307
liabilities
Total Liabilities 811,747 797,986 -13,761 -1.70
Capital stock 1,663,029 1,663,029 0 0.00
Capital surplus 9 9 0 0.00
Retained earnings 274,294 264,669 -9,625 -3.51
Other Equities -103,296 -119,553 -16,257 15.74 NOTE (二)1
Treasury stock 0 0 0 0.00
Non-control equity 0 0 0 0.00
Total equity 1,834,036 1,808,154 -25,882 -1.41
----- End of picture text -----

(2) Analysis of Recent Changes: (the analysis focuses on items with changes exceeding 10% and reaching a threshold of NT$10,000 thousand.)

  1. Other Equity: This was mainly attributable to the disposal of financial assets measured at fair value through other comprehensive income during the current period.

~ 92 ~

2. Financial Performance

(1) Consolidated comparative analysis table of financial performance

Unit: NTD in thousands

==> picture [442 x 382] intentionally omitted <==

----- Start of picture text -----

Increase
Year (Decrease) in Change Ratio
Item Year 2024 Year 2025 Amount ％
Operating revenue 757,457 845,768 88,311 11.66
Operating gross profit 276,044 309,798 33,754 12.23
Operating expenses 199,273 192,634 -6,639 -3.33
Operating Profit (Loss) 76,771 117,164 40,393 52.61
Non-operating income and 78,834 6,342 -72,492 -91.96
expenses
Net Profit Before Tax on 155,605 123,506 -32,099 -20.63
Continuing Operations
Income Tax Expense 30,074 41,633 11,559 38.44
Current net profit (loss) 125,531 81,873 -43,658 -34.78
Current Other Comprehensive -15,538 -11,299 4,239 -27.28
Income
Total comprehensive income for 109,993 70,574 -39,419 -35.84
the period
Net profit attributable to owners of 125,531 81,873 -43,658 -34.78
the parent.
Net Profit Attributable to 0 0 0 0.00
Non-Controlling Interests
Total Comprehensive Profit and 109,993 70,574 -39,419 -35.84
Loss Attributable to Owners of
Parent Company
Total comprehensive income 0 0 0 0.00
Comprehensive income attributed
to non-controlling interests.
Earnings Per Share (NT$) 0.75 0.49 -0.26 -34.67
----- End of picture text -----

1. Analysis of Changes in Ratios:

  • (1) Operating Revenue (Gross Profit): This was mainly due to increased global inventory restocking demand during the current period, along with successful cultivation of high-margin niche customer orders, which boosted gross profit and led to growth in both operating revenue and gross profit compared to the previous period.

  • (2) Operating Net Profit (Loss): This was mainly due to improved cost control during the current period, which resulted in a slight decrease in selling and administrative expenses compared to the previous period; therefore, operating profit increased in the current period.

  • (3) Non-operating Income and Expenses: This was mainly due to an increase in foreign exchange losses arising from exchange rate fluctuations in the current period compared to the previous period.

  • (4) Net Profit (Loss) for the Period: This was mainly due to a decrease in non-operating income, resulting in a slight decline in net profit for the current period compared to the previous period.

  • (5) Other Comprehensive Income for the Period (Net of Tax): This was mainly due to a decrease in gains from exchange differences arising from the translation of financial statements of foreign operations, as well as an increase in unrealized losses on foreign corporate bonds.

  • Reasons for significant changes in the company's main business activities: None.

  • Forecasted sales quantity for the upcoming fiscal year and the primary factors influencing the company's expected sales growth or decline:

~ 93 ~

Unit:ThousandPieces (K/PCS) Unit:ThousandPieces (K/PCS) Unit:ThousandPieces (K/PCS)
Expected sales quantity for major products
Primary factors influencing the
potential continuous
growth or decline in expected
sales quantity:
Item
Year 2026
Year 2025
The company's sales forecast is
based on the sales performance
and pricing in the years 2024
and 2025.
Rectifier
789,600
658,000
Face mask
6,180
5,150
Face mask 6,180 5,150

3. Cash Flow

Cash Flow Analysis

h Flow
Cash Flow Analysis		 h Flow
Cash Flow Analysis		 h Flow
Cash Flow Analysis		 h Flow
Cash Flow Analysis
Unit: NTD in thousands
Initial Cash
Balance
Net Cash Flow
from Operating
Activities for the
Year
Total Cash
Outflows
for the Year
Cash Surplus
(Deficit) Amount		 Remedial Measures for
Cash Shortage
Investmen
tplan
Financial
Planning
564,394 98,484 214,704 448,174 - -
  • (1) Analysis of Annual Cash Flow Changes:

The Company’s net cash decreased by $116,220 thousand in 2025 compared to 2024. The changes in cash flows from various operating activities are as follows:

  • (1) Operating Activities: Due to increased collections in the prior period, inventories increased in the current period compared to the previous period, while accounts payable decreased. As a result, net cash inflow from operating activities declined compared to the previous period.

  • (2) Investment Activities: This was mainly due to the acquisition of financial assets measured at fair value through profit or loss and increased purchases of property, plant, and equipment during the current period, resulting in a higher net cash outflow compared to the previous period.

  • (3) Financing Activities: This was mainly due to an increase in cash dividends paid during the current period compared to the previous period, resulting in a higher net cash outflow from financing activities.

  • (2) Cash Shortage Remedial Measures and Liquidity Analysis:

  • Cash Shortage Remedial Measures: None.

  • Liquidity Analysis:

hortage Remedial Measures and Liquidity Analysis:
ash Shortage Remedial Measures: None.
iquidityAnalysis:		 hortage Remedial Measures and Liquidity Analysis:
ash Shortage Remedial Measures: None.
iquidityAnalysis:		 hortage Remedial Measures and Liquidity Analysis:
ash Shortage Remedial Measures: None.
iquidityAnalysis:		 hortage Remedial Measures and Liquidity Analysis:
ash Shortage Remedial Measures: None.
iquidityAnalysis:
December 31,
2024
December 31,
2025
Increase (decrease)
rate %
Cash Flow Ratio(%)
26.82
13.59
-13.23
Cash Flow Adequacy
Ratio (%)
321.51
189.63
-131.88
Cash Flow Reinvestment
Ratio (%)		 8.48 0.14 -8.34

  • (1) Cash Flow Ratio: This was mainly due to the collection of accounts receivable in the prior period and a decrease in accounts payable in the current period, resulting in a lower cash flow ratio in the current period compared to the previous period.

  • (2) Cash Liquidity Ratio: This was mainly due to a decrease in cash inflows from operating activities

~ 94 ~

in the current period compared to the same period of the previous year, as well as over the past five years.

  • (3) Cash Reinvestment Ratio: This was mainly due to a decrease in net cash inflow from operating activities in the current period compared to the same period of the previous year.

  • (3) Analysis of Future Cash Liquidity for the Next Year:

lysis of Future Cash Liquidity for the Next Year: lysis of Future Cash Liquidity for the Next Year: lysis of Future Cash Liquidity for the Next Year: lysis of Future Cash Liquidity for the Next Year:
Beginning
Beginning
Estimated net cash
flows from operating
iii f h fll
Estimated cash
outflows for
Estimated
surplus
dfii f		 Expected measures to
remedy any cash
shortfall.
Cash Balance
actvtes or te u
year.
the full year.
(ecency) o
cash remaining.		 Investment
plan
Financial
Planning
448,174 119,944 52,657 515,462 - -

1.Analysis of Expected Cash Flows for the Year 2026:

The Company’s opening cash balance was $448,174 thousand. It is estimated that net cash inflow from operating activities over the next year will be approximately $119,944 thousand, while net cash outflows from financing activities are expected to be approximately $52,657 thousand. Accordingly, the projected ending cash balance is approximately $515,462 thousand. 2.Remedial measures and analysis of cash shortfall: None.

4. The impact of significant capital expenditures in the most recent fiscal year on financial operations.

： None .

5. The recent year's investment policy and the main reasons for profitability or loss in investments, along with improvement plans and future one-year investment plans.:

1. Investment Policy

The Company’s new investments remain primarily focused on the semiconductor business. To mitigate operational risks, the Company will pursue diversified operations as a supplementary strategy in response to market changes.

2. Main Reasons for Profit or Loss.

In 2025, the Company’s investee businesses experienced modest revenue growth compared to the previous year, driven by the gradual depletion of excess inventory in the global supply chain and a subsequent recovery in market demand.

  1. Future Year Investment Plan.

In addition to maintaining its current investment policy, the Company will continue to monitor industry trends and invest at appropriate times based on changes in the business environment.

6. Analysis and assessment of risk factors.

(1) Impact of interest rates, exchange rates, and inflation on the company's income and measures to be taken

in the future.

Unit: NTD in thousands

Year
Item
Year 2024		 Year
Item
Year 2024		 Year 2025
Interest expense 301 177
Netexchange (loss) gain 42,473 (28,408)
Inflation - -

~ 95 ~

  1. Impact of interest rates, exchange rates, and inflation on company's revenue and profitability:

The company closely monitors interest rate fluctuations and manages its cash position to control liquidity risk. The company's operating funds are sufficient to meet cash requirements when bank loan contracts mature, mitigating liquidity risk without the need for additional fundraising.

The sensitivity analysis is based on the interest rate exposure of derivative and non-derivative instruments as of the reporting date. For floating-rate liabilities, the analysis assumes that the outstanding amount remains constant throughout the year.

The management reports to key executives using a rate change of +/- 0.5%, which represents a reasonable range of interest rate fluctuations.

If interest rates increase or decrease by 0.5% while all other variables remain constant, the company's pre-tax net profit for the fiscal year 2025 will decrease or increase by 0 thousand NT dollars due to the impact of variable-rate bank borrowings.

  • 2.Specific measures to address exchange rate fluctuations:

  • (1) The company regularly analyzes exchange rate trends, monitors its cash position, and plans appropriate fundraising channels. It evaluates bank loan interest rates and maintains close communication with banks to stay informed about the latest exchange rate developments and control liquidity risk.

  • (2) Depending on the financial situation and exchange rate fluctuations, the company adjusts foreign currency deposits in a timely manner.

  • 3.Impact of inflation and corresponding measures:

Rising oil and electricity prices and higher raw material costs exert pressure on the company's expenses. The current strategy is to continuously develop suppliers to lower raw material costs and minimize the impact of inflationary pressures on raw material price increases.

(2) Policies, main reasons for profit or loss, and future response measures for engaging in high-risk, high-leverage investments, lending funds to others, endorsing guarantees, and trading in derivative financial products are analyzed and evaluated on an annual basis and up until the date of the annual report ：

  1. The company does not engage in high-risk or highly leveraged investments, nor does it provide funds to others.

  2. Endorsement and guarantees: The company follows its endorsement and guarantee procedures, and as of the date of the annual report printing, the company has not engaged in any endorsement or guarantee transactions.

  3. Derivative transactions: The company follows its procedures for dealing with derivatives, and as of the date of the annual report printing, the company has not engaged in any derivative transactions.

  4. (3) Future research and development plans and expected R&D expenses:

In 2025, the Company established a wafer design team to actively develop relationships with more high-quality wafer foundries and implement various development projects. The primary focus is on

~ 96 ~

lead-free processes, particularly those featuring special low-power consumption and ultra-fast recovery characteristics, in order to proactively align with European environmental regulations.

As for packaging, development efforts are mainly driven by the needs of major customers for new products. These include the development of high-power DIP bridge packages as well as lead-free PLP (Panel Level Packaging) processes.

==> picture [497 x 105] intentionally omitted <==

----- Start of picture text -----

Expected R&D and
Current development Expected
Products under development production costs
progress completion time
(in NTD)
ULBF In progress 6,000,000 2026/04/30
RSBF In progress 6,000,000 2026/06/30
TO247-IGBT-RI40N1200T7/RI75N650T7 In progress 7,000,000 2026/12/31
PLP Lead-free packaging process In progress 15,000,000 2027/06/30
----- End of picture text -----

  • (4) Impact of Important Changes in Domestic and International Policies and Regulations on Corporate Finance and Sales, and Response Strategies:

The company constantly monitors significant domestic and international policy and legal changes and evaluates their potential impact. In the past year, there have been no significant policy or legal changes that have adversely affected the company's financial operations.

  • (5) The impact of technological changes (including cybersecurity risks) and industry transformations on the Company's financial operations and corresponding measures are considered.

The company's products serve as essential components in electronic products, and technological advancements still require the use of the company's products. The company actively invests in research and development to promote the application of its products and enhance competitiveness, which is a key goal for the company. In terms of information security risk management, the company has established and implemented an information security management system. Information security policies have been established to regulate the company's information security practices. Regular internal information security audits are conducted to ensure the effectiveness of the management system and compliance with legal regulations. Therefore, information security risks are not considered significant operational risks for the company.

  • (6) Impact of changes in corporate image on crisis management and response measures:

The company maintains a good corporate image, and there have been no changes in corporate image that would impact crisis management.

  • (7) Anticipated benefits, potential risks, and response measures related to mergers and acquisitions: None.

  • (8) Anticipated benefits, potential risks, and response measures related to expanding facilities: None.

  • (9) Risks associated with concentration in purchasing or sales and response measures: None.

  • (10) Impact, risks, and response measures related to the significant transfer or replacement of directors, supervisors, or major shareholders holding more than 10% of shares: None.

  • (11) Impact, risks, and response measures related to changes in ownership rights: None.

~ 97 ~

  • (12) Disclosure of significant litigation, non-litigation events involving the company, directors, supervisors, general manager, substantial responsible person, major shareholders holding more than 10% of shares, and subsidiary companies, where the outcomes may have a significant impact on shareholders' equity or securities prices. The disclosure should include the disputed facts, amount involved, commencement date of litigation, key parties involved, and the status of the proceedings as of the printing date of the annual report: None.

  • (13) Other significant risks and response measures: None.

7. Other significant matters: None.

~ 98 ~

6. Special Notes

1. Related information on affiliated enterprises

  • (1) Consolidated business report of affiliated enterprises

Please refer to the "Related Party Transaction Statements Section" under "Single Company > Electronic Document Download" on the Market Observation Post System (MOPS): https://mopsov.twse.com.tw/mops/web/bfhtm_q2

  • (2) Consolidated Financial Statements of Related Companies

    • Since the consolidated financial statements of related parties are identical to those in the annual financial report, and a declaration has already been issued in the annual financial report, please refer to page 3 of the 2025 consolidated financial report of Rectron, available on the Market Observation Post System (MOPS) under: Single Company > Electronic Document Download > Financial Reports https://mops.twse.com.tw/mops/#/web/t57sb01_q1

  • (3) Related party report: Not applicable

2. Private placement of tradable securities in the recent fiscal year and up to the date of printing of the annual report: None.

3. Holdings or disposals of the company's shares by subsidiary companies in the recent fiscal year and up to the date of printing of the annual report: None.

4. Other necessary supplementary explanations: None.

7. Major events in the most recent year up until the publication date of the annual report with significant impact on shareholders’ equity or stock price: None

  • (1) Appendix I – Consolidated Financial Report:

    • Please refer to the 2025 Consolidated Financial Report of Rectron, available on the Market Observation Post System (MOPS) under:

Single Company > Electronic Document Download > Financial Reports https://mops.twse.com.tw/mops/#/web/t57sb01_q1

(2) Appendix II – Standalone Financial Report:

Please refer to the 2025 Standalone Financial Report of Rectron, available on the Market Observation Post System (MOPS) under:

Single Company > Electronic Document Download > Financial Reports https://mops.twse.com.tw/mops/#/web/t57sb01_q1

~ 99 ~

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