Stock Code: 2321

^{}[]

TECOM

TECOM CO., LTD.

2025 ANNUAL REPORT

Printed on March 31, 2026

Annual report is available at http://mops.twse.com.tw http://www.tecom.com.tw

This English version is only a translation of the Chinese version. If there is any inconsistency or discrepancy between the Chinese and English versions, the Chinese version shall prevail for all intents and purposes.

Company Spokesman : Li, Mei-Ling
Title : Director Finance & Accounting Division
Tel : (03)577-5141
Email : emily.lee @tecom.com.tw
Acting spokesman : Wang, Yen-Lee
Title : Manager Finance & Accounting Division
Tel : (03)577-5141
Email : [email protected]
Head office : 23, R & D 2 Road, Hsinchu Science Park, Hsin-Chu Taiwan (R.O.C.)
Tel : (03)577-5141
Taipei Office : 7F., No. 19-8, Sanchong Rd., Nangang Dist., Taipei City, Taiwan (R.O.C.)
Tel : (02)2655-1000
Taichung Office : No. 113, Dadun 12th St., Nantun Dist., Taichung City, Taiwan (R.O.C.)
Tel : (04)2320-5777
Kaohsiung Office : Rm. B, 6F., No. 59, Minquan 1st Rd., Lingya Dist., Kaohsiung City, Taiwan (R.O.C.)
Tel : (07)331-3376
The stock transfer agency : Stock Agency Department, Taishin Securities Co., Ltd.
Address : B1., No. 96, Sec. 1, Jianguo N. Rd., Zhongshan Dist., Taipei City, Taiwan (R.O.C.)
Tel : (02)25048125
Website : https://www.tssco.com.tw
Names of CPAs : Jiang, Cheng Han, Liu, Chien-Yu
Name of CPA firm : PwC Taiwan
Address : 27F., No. 333, Sec. 1, Keelung Rd., Xinyi Dist., Taipei City, Taiwan (R.O.C.)
Tel : (0 Website 2)2729-6666
Website : https://www.pwc.tw
Venue for trading the Company’s listed overseas securities and inquiry method for such overseas securities: Nil
Company website : https://www.tecom.com.tw

Table of Contents for Annual Report

I. Letter to Shareholders ... 1
II. Corporate Governance Report ... 3
1. Directors, Supervisors, General Manager, Deputy General Manager, Associates, Departments and Branches Office Information ... 3
2. Remuneration paid to Directors, Supervisors, General Manager, and Deputy General Manager in the Past Year ... 9
3. Corporate Governance Status ... 14
4. Accountant Fees ... 49
5. Change of Accountants ... 50
6. The Employment of The Company’s Chairman, General Manager, Financial or Accounting Manager with the Firm of the Auditing CPA or Its Affiliated Businesses in the Past Year ... 50
7. Particulars about Changes in Shareholding and Equity Pledge of Directors, Supervisors, Managers and Shareholders Holding More Than 10% of The Company's Shares in the Past Year and as of the Date of Publication of the Annual Report ... 51
8. Information About the Top 10 Shareholders who are Interested parties or relatives within the second degree of kinship, including spouses ... 52
9. The Company, its directors, executives, and businesses directly or indirectly controlled by The Company, holding shares in the same investee company, and combining to calculate the comprehensive shareholding ratio ... 53

III. Fundraising status ... 54
1. Capital and Share ... 54
2. Corporate Bonds ... 57
3. Preferred Shares ... 59
4. Overseas Depositary Receipts ... 62
5. Employee Stock Options ... 62
6. New Share Issuance Restrictions on Employee Rights ... 62
7. Issuance of New Shares for Acquisition or Exchange of Other Companies’ Shares ... 62
8. Financing Plans and Implementation ... 62

IV. Operations Profile ... 63
1. Business Scope ... 63
2. Market and Sales Overview ... 74
3. Employee Information for the Last Two Years and as of the Publication Date of this Annual Report ... 88
4. Environmental Expenditure Information ... 89
5. Labor Relations ... 90
6. Information security management ... 91
7. Important Contracts ... 92

V. Review and Analysis of Financial Status and Business Results and Risk Issues ... 93
1. Financial Status ... 93
2. Financial Performance ... 94
3. Cash Flow ... 95
4. Impact of Major Capital Expenditure in the Past Year on the Financial ... 96
5. Re-investment Policy in the Past Year, the Main Reason for Its Profit or Loss, the Improvement Plan and Investment Plan in the Next Year ... 96
6. Review and Analysis of Risk Issues in the Past Year and as of the Date of Publication of the Annual Report ... 96
7. Other important matters ... 98

VI. Special notes ... 99
1. Information about The Company’s Affiliates ... 99
2. Private Placement of Securities in the Past Year and as of the Date of Publication of the Annual Report ... 99
3. Other Necessary Supplementary Notes ... 99
4. Matters in the Past Year and as of the Date of Publication of the Annual Report Which Have a Substantial Impact on Owner’s Equity as Stipulated in Item 3, Paragraph 2 of Article 36 of the Securities Exchange Law ... 99

I. Letter to Shareholders

Dear Shareholders,

In 2025, Taiwan's economy demonstrated steady growth, supported by strong global demand for artificial intelligence and a recovery in the technology sector. However, industries across the board also faced rising production costs due to surging prices of raw materials and energy. In addition, compliance requirements and the global push for energy conservation and carbon reduction within supply chains posed further challenges.

The Company's operations span three major sectors: SME business communications, smart building solutions, and intelligent electromechanical systems with a focus on energy saving and carbon reduction. Although the transition to mobile and digital solutions has led to a decline in call volume for traditional wired business PBX systems, SMEs continue to show steady annual demand for system upgrades. With the Company maintaining a market share of nearly $70\%$ , the market remains stable. In the smart building sector, the number of housing completions decreased in 2025 due to labor shortages, resulting in lower-than-expected revenue. However, the government's strong policy push toward building energy efficiency is expected to become a new growth driver in 2026.

In the area of energy-saving and intelligent electromechanical systems, significant progress was achieved due to government efforts to promote energy conservation and the manufacturing industry's push toward low-carbon and smart transformation. Notably, our carbon inventory, carbon management, and energy management services integrating Artificial Intelligence of Things (AIoT), system platform development, data collection and analysis were further enhanced by our consulting services in carbon and energy management. By the end of 2025, we successfully partnered with a government-affiliated foundation to secure projects related to carbon inventory and energy management, which are expected to contribute new revenue streams in 2026.

1. Results of Business Plan Implementation

In 2025, in addition to continuing organizational optimization and cost reduction efforts, the Company also developed a series of forward-looking and innovative solutions in AIoT, energy conservation and carbon reduction, and business communication applications, aiming to tap into high-margin market opportunities. For the year, the standalone operating revenue amounted to NT$464.31 million, with a net loss after tax of NT$12.25 million.

On a consolidated basis, the total operating revenue reached NT$732.51 million, with a consolidated net loss after tax of NT$5.62 million.

2. 2025 Financial Revenue and Expenditure Analysis and Profitability Analysis

The 2025 and 2024 Financial Revenue and Expenditure Analysis and Profitability Analysis are as follows:

(Unit: NTD thousand dollars)

Items	2025	2024
Individual
Operating revenue	464,314	483,859
Operating profit (loss)	(25,669)	(15,506)
Net Income (Loss)	(12,251)	(14,694)
Total comprehensive income	(9,033)	(6,323)
Combined
Operating revenue	732,508	631,414
Operating profit (loss)	(6,190)	(22,434)
Net Income (Loss)	(5,619)	(16,848)
Total comprehensive income	(2,401)	(8,477)

Note : Please refer to the Company's financial reports and annual reports for comprehensive information on all financial matters.

3. Research Development Expenditure

The Company's R&D capabilities have not only been recognized by domestic and international customers, but we also place great emphasis on product layout. Our annual R&D expenses totaled NT$72.16 million. Our main R&D focuses on enterprise-level new-generation IP mobile switchboard systems, full-network smart home systems, cloud-based smart security video solutions, Industrial IoT smart electro-mechanical health management systems and cloud services, energy efficiency monitoring and management, corporate carbon management, and digital carbon inventory tools, etc. These are the key drivers of the Company's sales growth.

2026 Business Objectives

Looking ahead to 2026, the growth trend in digital transformation and Industrial Internet of Things (IIoT) applications remains strong. The Company will continue to enhance its offerings in the existing domains of business communications and smart building solutions by providing value-added features to drive revenue growth. In parallel, the Company will further advance its strategic transformation toward energy conservation and carbon reduction.

2026 Business Policy and Sales Policy

(1) Business Strategy

Smart Energy Management and Digital Transformation:

Promote dual transformation in digitalization and decarbonization by integrating digital management systems that combine software and hardware with the ESCO (Energy Service Company) model, enabling enterprises to reduce energy consumption and operational costs.

Integration of Smart Operation & Maintenance (Smart O&M) and Energy Management Systems:

Empower enterprises to achieve both low-carbon and intelligent transformation by reducing carbon emissions and electricity usage across factory operations, production lines, and buildings.

Ongoing Development of Smart Security and Communication Systems:

Continue to invest in and enhance smart home/building intercom and security systems, as well as smart office business communication solutions. Actively expand into both domestic and international markets

(2) Sales Policy

Continue to adjust the channel structure, introduce the integration of new products, import product quality and strengthen after sales service, establish a diversified internet service system, to improve profitability.
Develop thoroughly the smart electro-mechanical health management systems and cloud services, assist electromechanical equipment maintenance partners to utilize digital solutions to improve preventive maintenance abilities, ensure the operations of customers' factories and production equipment, reduce energy consumption and carbon emissions.
Centering on ESG solutions, we provide one-stop services to empower enterprises in achieving dual transformation in digitalization and decarbonization.
Impact of External Competitive Environment, Regulatory Environment, and Macro Business Environment

Amid the growing trends of smart manufacturing, smart operation & maintenance, and energy conservation and carbon reduction, the Company is actively investing in industry-specific IoT solutions tailored to different application scenarios. These solutions are expected to become key competitive advantages in driving a return to profitability in 2026.

As the external competitive landscape continues to evolve rapidly, the Company remains vigilant in monitoring major domestic and international strategic and regulatory developments. By proactively aligning with regulatory trends—such as those related to energy conservation and carbon reduction—we aim to transform compliance requirements into innovative market opportunities.

The Company's management team and all employees deeply understand the expectations of shareholders and the general public. Looking ahead, in fiscal year 2026, in addition to pursuing revenue growth, our primary goal is to ensure profitability and continue to reduce the combined debt of the Company and the group. In addition to revenue growth, the Company also aims to maintain its gross profit margins of its main businesses. We will continue to focus on stable risk control, actively optimize our business model and strategy to improve operational performance, while also providing greater profits and growth to our shareholders. We would like to express our gratitude to all shareholders for their support and encouragement over the past year.

Chairman: Wu, Su-Chiu
General Manager: Tien, Ying-Juei
Accounting Supervisor: Li, Mei-Ling

II. Corporate Governance Report

Directors, Supervisors, General Manager, Deputy General Manager, Associates, Departments and Branches Officer Information

(1) Directors

March 28, 2026

Job title	Nationality	Name	Gender/Age	Date of Appointment	Term	Date of appointment to position	Shares held at Time of Appointment		Shares held		Shares held by spouse and minor children		Shares held through nominees		Principal work experience and academic qualifications	Positions concurrently held in other companies at present	Other managerial officer(s) with which the person has a relationship of spouse or relative within the second degree
							No. of shares	Shareholding ratio	No. of shares	Shareholding ratio	No. of shares	Shareholding ratio	No. of shares	Shareholding			Job title	Name	Relationship
Chairman	ROC	TECO Electric & Machinery Co., Ltd	Female 61-70 years old	1140216	3years	1140216	60,090,307	63.52%	19,228,898	63.52%	0	0%	0	0%	M.S. in Financial Management: Syracuse University, New York, USA	Vice Chairman of TECO Electric & Machinery Co., Ltd	None	None	None
		Representative - Wu, Su-Chiu							0	0%	0	0%	0	0%
Directors	ROC	TECO Electric & Machinery Co., Ltd	Male 51-60 years old	1140804	3years	1140804	60,090,307	63.52%	19,228,898	63.52%	0	0%	0	0%	M.S. in Financial Management, National Chengchi University, Taiwan	Director of Finance, Finance and Administration Center, TECO Electric & Machinery Co., Ltd.	None	None	None
		Representative - Liu, Su-Sheng							0	0%	0	0%	0	0%
Directors	ROC	TECO Electric & Machinery Co., Ltd	Male 61-70 years old	1130618	3years	1040608	60,090,307	63.52%	19,228,898	63.52%	0	0%	0	0%	Graduate Institute of Industrial Management, National Taiwan University of Science and Technology	Associate Vice President, Finance and Administration Center, TECO Electric & Machinery Co., Ltd.	None	None	None
		Representative - Liu, An-Bing							0	0%	0	0%	0	0%
Directors	ROC	TECO Electric & Machinery Co., Ltd	Male 61-70 years old	1130618	3years	1130618	60,090,307	63.52%	19,228,898	63.52%	0	0%	0	0%	LL.M. in European Studies, College of International Affairs, Tamkang University, Taiwan	General Manager of TECOM CO. LTD.	None	None	None
		Representative - Tien, Ying-Juei							0	0%
Directors	ROC	Liu, Chao-Kai	Male 71-80 years old	1130618	3years	690925	3,679,189	3.89%	1,177,340	3.89%	109,440	0.36%	0	0%	Ph.D. in Electrical Engineering from the University of Illinois, United States	Chairman of GDH CO., LTD.	None	None	None
Directors	ROC	Yang, Shih-Chien	Male 71-80 years old	1130618	3years	690925	0	0%	0	0%	0	0%	0	0%	Ph.D. in Electrical Engineering from Northwestern University, United States	Chairman of Global Strategic Management Consultant Co., Ltd.	None	None	None
Independent Directors	ROC	Chen, Hui-Ming	Female 51-60 years old	1130618	3years	1130618	0	0%	0	0%	0	0%	0	0%	Ph.D. in Business Administration, National Central University, Taiwan	Professor, Department of Management Sciences, Tamkang University	None	None	None
Independent Directors	ROC	Lin, Chiang-Sang	Male 51-60 years old	1130618	3years	1040608	0	0%	0	0%	0	0%	0	0%	Ph.D. in Accounting from the Department of Accounting at National Chengchi University, Taiwan	Professor of Accounting Department at Chung Yuan Christian University Independent Director, Audit Committee Member, and Remuneration Committee Member of Rushik Semiconductor Corp., Microelectronics Technology Inc., and Efron Technology, Inc.	None	None	None
Independent Directors	ROC	Lee, Feng Ao	Male 51-60 years old	1130618	3years	1070612	0	0%	0	0%	0	0%	0	0%	Master of Laws in Chinese Mainland Law from the In-Service Master's Program in Chinese Mainland Law at Soochow University, Taiwan	Managing Partner of Equilibrium Law Firm. Director and Audit Committee Member and Remuneration Committee Member of BlackSons Co., Ltd. Director of Chun-Tree Technology Co., Ltd.	None	None	None

Note 1: Ms. Wu, Su-Chiu was elected as the Chairperson of the Company on July 2, 2025.
Note 2: Mr. Lin, Jhia-Sheng was appointed as the representative of the institutional director on August 4, 2025.

Major shareholders of juridical-person shareholders

March 31,2026

Names of juridical-person shareholders	Major shareholders of juridical-person shareholders
	Shareholders	Shareholding%
TECO Electric & Machinery Co., Ltd	PJ Asset Management	15.71%
	Hon Hai Precision Industry Co., Ltd.	9.99%
	Walsin Lihwa Corporation	9.62%
	Jaryuan Investment Co. Ltd	5.05%
	Ho Yuan International Investment Co., Ltd.	2.12%
	Creative Sensor Co., Ltd.	1.98%
	Tong Kuang Investment Co., Ltd.	1.35%
	Kuang Yuan Industrial Co., Ltd.	1.13%
	Yinge Int. Inv. Co., Ltd	0.95%
	You Wan International Investment Co., Ltd.	0.86%

Major Shareholders of Corporate Entities listed in Table1 and their Corporate Shareholders 3.

4.March 31,2026

Corporate shareholders	Major shareholders of corporate shareholders
PJ Asset Management	Ho Yang Management Consulting Co., Ltd. (100%)
Hon Hai Precision Industry Co., Ltd.	Terry Gou (12.40%), Labor Pension Fund (New System) (1.77%), Yuanta Taiwan Top 50 ETF under the custody of CTBC Bank (1.68%), LGT Bank Investment Account under the custody of Standard Chartered Bank (1.30%), Stichting Depositary APG Emerging Markets Equity Pool under the custody of Standard Chartered Bank (1.26%), Vanguard Emerging Markets Stock Index Fund under the custody of J.P. Morgan Chase Bank (1.20%), iShares MSCI Emerging Markets ETF Investment Account under the custody of Citibank (Taiwan) (0.99%), Norges Bank Investment Account under the custody of Citibank (0.96%), Government of Singapore (GIC) Investment Account under the custody of Citibank (0.93%), Fidelity SAI All-Country World ex U.S. Index Fund under the custody of Standard Chartered Bank (0.63%)
Walsin Lihwa Corporation	Winbond Electronics Corp. (6.09%), Chin-Xin Investment Co., Ltd. (6.04%), Rong Jiang Co., Ltd. (5.00%), TECO Electric & Machinery Co., Ltd. (4.75%), Coutts & Co. Investment Account under the custody of Standard Chartered Bank (Taiwan) Ltd., Business Department (4.13%), HannStar Display Corp. (3.09%), Chiao, Yu-Hui (2.73%), Yu Siang Investment Co., Ltd. (1.79%), Ching An Investment Co., Ltd. (1.79%), Yun Xing International Ltd. (1.78%)
Jaryuan Investment Co. Ltd	Hai Lin-Chen (80.26%), Shu-Chiung Tseng (16.08%), Ho Yuan International Investment Co., Ltd. (3.55%), Chang Wei Management Consulting Co., Ltd. (0.11%)
Ho Yuan International Investment Co., Ltd.	Five Star Asset Management Co., Ltd. (100%)

-5-

Creative Sensor Co., Ltd.	Teco Image Co., Ltd. (18.88%), Universal Cement Corporation (8.59%), Tien Da Investment Co., Ltd. (8.06%), Universal Cement Investment Co., Ltd. (5.88%), Kuan-Ling Electronics Co., Ltd. (3.72%), Creative Sensor Inc. (Treasury Shares) (2.06%), Ah-Chung Hou (1.27%), CTBC Bank Co., Ltd. in its capacity as Trustee for the Employee Stock Ownership Association Trust Account of Creative Sensor Inc. (1.20%), Kao-Huang Lin (1.20%), Po-Han Chang (0.94%)
Tong Kuang Investment Co., Ltd.	Kuang Yuan Industrial Co., Ltd. (39.27%), Ho-Hui Huang-Lin (35.01%), Bright Industry (HK) Co., Ltd. (12.73%), Tong Ho Global Investment Co., Ltd. (6.00%), Others (6.99%)
Kuan Yuan Industrial Co., Ltd.	Tung Kuang Investment Co., Ltd. (34.46%), Ho-Hui Huang-Lin (51.58%), Bright Industry (HK) Co., Ltd. (10.0%), Tong Ho Global Investment Co., Ltd. (0.74%), Others (3.22%)
Yinge Int. Inv. Co., Ltd	Huang, Po-Chih (77.72%), Du-Man Investment Co., Ltd. (8.62%), Po-Shih International Investment Co., Ltd. (8.62%), Xiao-Li Creative Co., Ltd. (4.31%), and Hsu, Feng-Mei (0.72%)
Yu Wan International Investment Co., Ltd.	Kuan Yuan Industrial Co., Ltd.(39.13%), Tong Kuang Investment Co., Ltd.(30.20%), Hong Kong Wealth Friend Limited (8.44%), Huang, Jen-Hsin (2.61%), Liu, Hui-Tzu (2.43%), Lin, Yu-Chao (2.11%), Lin, Li-Chung (2.00%), Lin, Yu-Ping (1.89%), Tseng, Lun-Pin (1.86%), and Chuang, Chung-Jen (1.80%),

5. Professional Qualifications and Independence of Directors

Name	Professional Qualifications and Experiences	Independence (Note)	Number of independent directors concurrently serving on the boards of other publicly listed companies.
Chairman, Wu, Su-Chiu	Possessing more than fifteen years of working experience in financial planning, currently serving as Vice Chairman of TECO Electric & Machinery Co., Ltd., and without any circumstances as stipulated in Article 30 of The Company Act.	Not applicable.	0
Representative of TECO Electric & Machinery Co., Ltd: Liu, An-Bing	Possessing more than twenty years of working experience in company operations, currently serving as Associate Vice President of the Finance and Administration Center, TECO Electric & Machinery Co., Ltd. and without any circumstances as stipulated in Article 30 of The Company Act.	Not applicable.	0
Representative of TECO Electric & Machinery Co., Ltd: Lin, Jia-Sheng	Possessing more than twenty years of working experience in company operations, currently serving as Director of Finance of the Finance and Administration Center, TECO Electric & Machinery Co., Ltd. and without any circumstances as stipulated in Article 30 of The Company Act.	Not applicable.
Representative of TECO Electric & Machinery Co., Ltd: Tien, Ying-Juei	Possessing more than twenty years of working experience in company operations, currently serving as General Manager of TECOM CO. LTD., and without any circumstances as stipulated in Article 30 of The Company Act.	Not applicable.	0
Liu, Chao-Kai	Possessing more than twenty years of working experience in company operations, currently serving as Chairman of GDH CO.,	Not applicable.	0

Conditions Name	Professional Qualifications and Experiences	Independence (Note)	Number of independent directors concurrently serving on the boards of other publicly listed companies.
	LTD., and without any circumstances as stipulated in Article 30 of The Company Act.
Yang, Shih-Chien	Possessing more than five years of working experience in company operations, currently serving as Chairman of Global Strategic Management Consultants Inc., and without any circumstances as stipulated in Article 30 of The Company Act.	Not applicable.	1
Chen, Shui Lien	Holding an professorship in the Department of Management Sciences at Tamkang University, with a degree in finance and accounting, and without any circumstances as stipulated in Article 30 of The Company Act.	(1) Not holding the positions of director, supervisor, or employee of the company or affiliates by himself/herself, spouse, or relatives within second degree of kinship (2) Not holding the company's shares by himself/herself, spouse, or relatives within second degree of kinship (or in the name of others) (3) Not holding the positions of director, supervisor, or employee at companies with special relationship with the company (as specified in article 3-1-5~8 of "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies") (4) No provision of such services as commerce, legal affairs, and accounting to the company and affiliates, as well as no collection of compensations, in recent two years. (5) Compliance with the conditions of independence listed in the "Regulations Governing Appointment of Independent Directors and Compliance Matters of Public Companies" of the Financial Supervisory Commission.	0
Lin, Chiang-liang	Serving as a professor in the Department of Accounting at Chung Yuan Christian University, with a degree in finance and accounting, and without any circumstances as stipulated in Article 30 of The Company Act.		3
Lee, Feng Ao	Having passed the national examination and obtained a lawyer's certificate, currently serving as Managing Partner of Chunghsing Law Firm, and without any circumstances as stipulated in Article 30 of The Company Act.		0

Note: Based on the listing review criteria and the requirements for the establishment and compliance of independent directors of public companies, The Company has obtained independence declaration statements from each independent director, confirming their compliance with the legal requirements for independent qualifications.

6. Board Diversity and Independence

(1) Board Diversity:

The Company implements a policy of board member diversification in accordance with the Corporate Governance Best Practice Principles, including but not limited to the following two dimensions:

Basic Conditions and Values: gender, age, nationality, and culture, etc.
Professional Knowledge and Skills: professional background (such as law, accounting, industry, finance, marketing, or technology), professional skills, and industry experience, etc. At the 2024 Annual Shareholders' Meeting held on June 18, 2024, The Company elected a total of 9 directors (including 3 independent directors), and the specific management goal of the board's diversification policy was achieved as follows:

Management Targets:	Achievement:	Note
The board of directors should include at least one female director.	The board of directors includes two female directors. The proportion of female directors increased to 22.22%.	Achieved
The number of directors who also serve as company executives should not exceed one-third of the total number of directors	One director also serves as a company executive, accounting for 1/9 of the total number of directors.	Achieved
There should not be more than two directors who have a spouse or a first-degree relative on the board.	There are no directors who have a spouse or a first-degree relative on the board.	Achieved
Independent directors now account for more than one-third of the board seats.	The proportion of independent directors rising to 33.33%.	Achieved

The implementation of the board diversity policy is as follows:

Diversity Core Elements Directors' Name	Basic Conditions and Values			Initial Appointment Date (YYYY/MM/DD)	Independent Director Tenure	Professional Background Experience				Professional Knowledge and Skills
	Nationality	Gender	Age			Law	Accounting	Industry	Technology	Operational Judgment Ability	Management Ability	Leadership and Decision-making Ability	Crisis Management Ability	Industry Knowledge	International Market Perspective
Liu, Chao-Kai	ROC	Male	71-80	1980/09/25				V	V	V	V	V	V	V	V
Wu, Su-Chiu		Female	61-70	2025/02/16			V	V	V	V	V	V	V	V	V
Yang, Shih-Chien		Male	71-80	2006/06/09				V	V	V	V	V	V	V	V
Peng, Chi-Tseng		Male	51-60	2024/06/18				V	V	V	V	V	V	V	V
Liu, An-Bing		Male	61-70	2024/06/18			V	V	V	V	V	V	V	V	V
Tien, Ying-Juei		Male	61-70	2024/06/18				V	V	V	V	V	V	V	V
Chen, Shui Lien (Independence Director)		Female	51-60	2024/06/18	<3 Years		V			V	V	V	V	V	V
Lin, Chiang-liang (Independence Director)		Male	51-60	2015/06/08	9< Years		V			V	V	V	V	V	V
Lee, Feng Ao (Independence Director)		Male	51-60	2018/06/12	6-9 Years	V				V	V	V	V	V	V

(2) Board of Directors' Independence:

The current Board of Directors of The Company consists of 9 members, including 3 independent directors, representing a proportion of $33.3\%$ . As of the end of 2025, the independent directors have all met the regulations of the Financial Supervisory Commission Securities and Futures Bureau regarding independent directors, and there have been no circumstances falling under Articles 26-3, Paragraph 3 and 4 of the Securities and Exchange Act among the directors and independent directors.

(2) General Manager, Deputy General Manager, Associates, Departments and Branches Officer Information
March 31, 2026

Job title	Nationality	Name	Gender	Date of Appointment	Shares held		Shares held by spouse and minor children		Shares held through nominees		Principal work experience and academic qualifications	Positions concurrently held in other companies at present	Other managerial officer(s) with which the person has a relationship of spouse or relative within the second degree
					No. of shares	Shareholding ratio	No. of shares	Shareholding ratio	No. of shares	Shareholding ratio			Title	Name	Relations
General Manager	ROC	Tien, Ying-Juei	Male	2023.01.03	0	0%	0	0%	0	0%	Master's Degree in Law from the European Studies Institute, College of International Relations, Tamkang University	Corporate Representative of TECO Electric & Machinery Co., Ltd. Chairman of Wu Han Tecom Co., Ltd.	None	None	None
Deputy General Manager	ROC	Sun, Hsu-Hsin	Male	2017.01.01	0	0%	0	0%	0	0%	National Cheng Kung University Department of Transportation and Communication Management Science	Director, Wuhan Tecom Technologies Co., Ltd.	None	None	None
Head of Finance and Accounting	ROC	Li, Mei-Ling	Female	2025.12.17	0	0%	0	0%	0	0%	Tamkang University Department of Accounting	Director, GDH Co., Ltd.	None	None	None
Corporate Governance Officer	ROC	Tung, Hsien-Kang	Male	2023.03.25	0	0%	0	0%	0	0%	Master's Degree in Law from Washington College of Law, American University	None	None	None	None

(3) Where the Chairperson and the General Manager, or persons holding equivalent positions, are the same person, spouses, or relatives within the first degree of kinship, the reasons, reasonableness, necessity, and corresponding measures shall be explained: The Chairperson and the General Manager of the Company are not related within the first or second degree of kinship.

Remuneration paid to Directors, Supervisors, General Manager, and Deputy General Manager in the Past Year (1) Directors and Independent Directors' Remuneration

2026, Unit: in thousand NT$

	Title	Name	Directors' Remuneration							Ratio of A,B,C,D's Total to Net Profit after Tax (%)	Part-time Employees received Related Remuneration						Ratio of A,B,C,D,E,F,G's Total to Net Profit after Tax (%)	Receiving Remuneration from investments outside of Subsidiaries or the Parent Company
			Remuneration (A)		Pension (B)		Directors' remuneration(C)		Operating Expense(D)			Compensation Expense(E)		Pension(F)		Employee Bonus Stock(G)
			The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company		Cash Value	Stock Value
1	Chairman (Note4)	TECO Electric & Machinery Co., Ltd Representative-Wu, Su-Chiu	0	0	0	0	0	0	45.3	45.3	45.3 -0.3700%	45.3 -0.3700%	0	0	0	0	0	0	45.3 -0.3700%	45.3 -0.3700%	23,770
2	Directors (Note4)	Liu, Chao-Kai	0	0	0	0	0	0	266	266	266 -2.1713%	266 -2.1713%	2,698	2,698	0	0	0	0	2,964 -24.1927%	2,964 -24.1927%
3	Directors	TECO Electric & Machinery Co., Ltd Representative-Sun, Chien-Jung	0	0	0	0	0	0	7.1	7.1	7.1 -0.0577%	7.1 -0.0577%	0	0	0	0	0	0	7.1 -0.0577%	7.1 -0.0577%
4	Directors	TECO Electric & Machinery Co., Ltd Representative-Peng, Chi-Tseng	0	0	0	0	0	0	48.6	48.6	48.6 -0.3967%	48.6 -0.3967%	0	0	0	0	0	0	48.6 -0.3967%	48.6 -0.3967%
5	Directors	TECO Electric & Machinery Co., Ltd Representative-Liu, An-Bing	0	0	0	0	0	0	86	86	86 -0.7020%	86 -0.7020%	0	0	0	0	0	0	86 -0.7020%	86 -0.7020%
6	Directors	TECO Electric & Machinery Co., Ltd Representative-Tien, Ying-Juei	0	0	0	0	0	0	86	90	86 -0.7020%	90 -0.7346%	3,909	3,909	108	0	0	0	4103 -33.4904%	4107 -33.5231%
7	Directors	TECO Electric & Machinery Co., Ltd Representative-Lin, Jia-Sheng	0	0	0	0	0	0	37.4	37.4	37.4 -0.3053%	37.4 -0.3053%	0	0	0	0	0	0	37.4 -0.3053%	37.4 -0.3053%
8	Directors	Yang, Shih-Chien	0	0	0	0	0	0	614	614	614 -5.0118%	614 -5.0118%	0	0	0	0	0	0	614 -5.0118%	614 -5.0118%	None
9	Independent Directors	Lin, Chiang-liang	0	0	0	0	0	0	622	622	622 -5.0771%	622 -5.0771%	0	0	0	0	0	0	622 -5.0771%	622 -5.0771%	None
10	Independent Directors	Lee, Feng Ao	0	0	0	0	0	0	620	620	620 -5.0608%	620 -5.0608%	0	0	0	0	0	0	620 -5.0608%	620 -5.0608%	None
11	Independent Directors	Chen, Shui Lien	0	0	0	0	0	0	622	622	622 -5.0771%	622 -5.0771%	0	0	0	0	0	0	622 -5.0771%	622 -5.0771%	None

Note 1: Please describe the compensation policy, system, standards, and structure for independent directors, and explain the correlation between such compensation and factors including their duties, risks assumed, and time commitment: Compensation for independent directors is determined based on their level of participation in the Company's operations and the value of their contributions, with reference to prevailing industry standards and the Company's operating conditions. Such compensation is reviewed by the Remuneration Committee and submitted to the Board of Directors for approval.
Note 2: Except as disclosed in the table above, in the most recent fiscal year, no directors of the Company received compensation for providing services to all entities included in the financial reports (such as serving as consultants to the parent company, all entities included in the financial reports, or investee companies in a non-employee capacity).

Note 3: Calculated based on the Company's net loss after tax of NT$12,251 thousand as reported in the 2025 parent company only financial statements.

Note 4: Mr. Liu Chao-Kai resigned as Chairperson on July 2, 2025, and was succeeded by Ms. Wu Su-Chiu.

Remuneration Bracket Table

The remuneration brackets for the company's directors are as follows:	Name of Director (Note)
	The Company	All companies in financial statement
Below NT$ 1,000,000	1、3、4、5、7、8、9、10、11	1、3、4、5、7、8、9、10、11
NT$1,000,000 (inclusive) – NT$2,000,000 (exclusive)
NT$2,000,000 (inclusive) – NT$3,500,000 (exclusive)	2	2
NT$3,500,000 (inclusive) – NT$5,000,000 (exclusive)	6	6
NT$5,000,000 (inclusive) – NT$10,000,000 (exclusive)
NT$10,000,000 (inclusive) – NT$15,000,000 (exclusive)
NT$15,000,000 (inclusive) – NT$30,000,000 (exclusive)
NT$30,000,000 (inclusive) – NT$50,000,000 (exclusive)
NT$50,000,000 (inclusive) – NT$100,000,000 (exclusive)
NT$100,000,000 and above
Total	11people	11people

(Note: Each director is represented by an identification number)

2025, Unit: in thousand NT$

(2) General Manager, Deputy General Manager, and Managers' Remuneration

Number	Title	Name	Salaries(A)		Pension(B)		Compensation(C)		Employee Bonus Stock (D)				Ratio of A,B,C,D's Total to Net Profit after Tax (%) (Note 1)		Receiving Remuneration from investments outside of Subsidiaries or the Parent Company
			The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company		Companies in the consolidated financial report		The Company	Companies in the consolidated financial report
									Cash Value	Stock Value	Cash Value	Stock Value
1	General Manager	Tien, Ying-Juei	8,262	8,937	354	354	1,024	1,036	0	0	0	0	總額 9,640 占比 -78.69%	總額 10,326 占比 -84.29%	2,031
2	Deputy General Manager	Sun, Hsu-Hsin
3	Chief Financial Officer	Sun, Mau-Luen
4	Chief Accountant	Wang, Yen-Lee
5	Corporate Governance Officer	Tung, Hsien-Kang
6	Head of Finance and Accounting	Li, Mei-Ling

Note 1: Calculated based on the Company's net loss after tax of NT$12,251 thousand as reported in the 2025 parent company only financial statements.
Note 2: Mr. Sun, Mao-Luen resigned on December 15, 2025; Ms. Wang, Yen-Lee resigned on December 17, 2025; and Ms. Li Mei-Ling assumed the position on December 15, 2025 and assumed the position of Chief Accounting Officer on December 17, 2025.
Note 3: The retirement pension amount represents the Company's contributions made for individuals concurrently holding employee status, and does not represent actual amounts paid.

Remuneration Scale Table

Remuneration scale for each General Manager and Deputy General Manager of The Company	Name of General Managers and Deputy General Managers
	The Company	Companies in the consolidated financial report
Lower than 1,000,000 NT$	4、6	4、6
1,000,000 NT$ (Include) ~ 2,000,000 NT$ (Exclude)	2、3、5	2、3、5
2,000,000 NT$ (Include) ~ 3,500,000 NT$ (Exclude)
3,500,000 NT$ (Include) ~ 5,000,000 NT$ (Exclude)	1	1
5,000,000 NT$ (Include) ~ 10,000,000 NT$ (Exclude)
10,000,000 NT$ (Include) ~ 15,000,000 NT$ (Exclude)
15,000,000 NT$ (Include) ~ 30,000,000 NT$ (Exclude)
30,000,000 NT$ (Include) ~ 50,000,000 NT$ (Exclude)
50,000,000 NT$ (Include) ~ 100,000,000 NT$ (Exclude)
Over 100,000,000 NT$
Total	6 people	6 people

(3) Remuneration of the top five highest-paid Executives in the TWSE/TPEx Listed Company
2025 Unit: in thousand NT$

Title	Name	Salaries(A)		Pension(B)		Compensation(C)		Employee Bonus Stock (D)				Ratio of A, B, C, D's Total to Net Profit after Tax (%) (Note 1)		Receiving Remuneration from investments outside of Subsidiaries or the Parent Company
		The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report	The Company		Companies in the consolidated financial report		The Company	Companies in the consolidated financial report
								Cash Value	Stock Value	Cash Value	Stock Value
General Manager (Note1)	Liu, Chao-Kai	8,862	9,536	295	295	2,442	2,450	0	0	0	0	總額11,599占比-94.68%	總額12,282占比-100.25%	12,657
Deputy General Manager	Tien, Ying-Juei
Chief Financial Officer	Sun, Hsu-Hsin
Chief Accountant	Sun, Mau-Luen
Corporate Governance Officer	Tung, Hsien-Kang

Note 1: Mr. Liu Chao-Kai resigned as Chairperson on July 2, 2025.
Note 2: Calculated based on the Company's net loss after tax of NT$12,251 thousand as reported in the 2025 parent company only financial statements.
Note 3: The retirement pension amount represents the Company's contributions made for individuals concurrently holding employee status, and does not represent actual amounts paid.

(4) Names of Managers who distribute Employee Remuneration and the Distribution Situation

	Title	Name	Stock Value	Cash Value	Total	Ratio of Total to Net Profit after Tax(%)
Manager	General Manager	Tien, Ying-Juei	0	0	0	0
	Deputy General Manager	Sun, Hsu-Hsin
	Chief Financial Officer	Sun, Mau-Luen
	Chief Accountant	Wang, Yen-Lee
	Corporate Governance Officer	Tung, Hsien-Kang

Note: As the company incurred operating losses in 2025, no provision for employee remuneration was made.

(5) Comparison and Explanation of the information on the Remuneration paid to Directors, General Managers, and Deputy General Managers of The Company and all companies included in the consolidated financial statements in the past two years

Analysis of the ratio of total compensation to net profit after tax in the individual financial statements

Title	2024		2024
	The Company	Companies in the consolidated financial report	The Company	Companies in the consolidated financial report
Directors	-79.74%	-79.77%	-18.91%	-18.91%
General Managers and Deputy General Managers	-78.69%	-84.29%	-69.29%	-73.21%

Note: Director Remuneration includes compensation, pensions, director and supervisor remuneration, and business execution expenses; Manager Remuneration includes salaries, pensions, bonuses and special allowances, and employee compensation. The calculation is based on the after-tax net loss of NT$12,251 thousand in the company's 2025 parent-only financial statement.

Explain the policies, standards, and combinations of remuneration payments, the procedures for setting remuneration, and the relationship between operational performance and future risks:

(1). The remuneration paid to directors of The Company mainly includes remuneration for performing their duties and remuneration set aside for directors and supervisors in accordance with The Company's articles of association. The remuneration payment policy is based on their level of participation in operations and their contribution value.
(2). The remuneration paid to the general manager and deputy general manager of The Company is based on a comprehensive assessment of The Company's and their individual operational performance. Performance evaluation is based on the degree of achievement of operational goals, profit margins, growth rates, operational efficiency, and future development potential. The targets and their weights are set at the beginning of the year based on the internal and external operating environment and a comprehensive consideration of future risk factors.
(3). In summary, the remuneration of directors, general managers, and deputy general managers is executed in accordance with The Company's existing regulations, and there will be no significant impact on The Company's future operational risks.
(4). Apart from reasonable remuneration received from The Company, the directors, general managers, and deputy general managers of The Company do not receive remuneration from other companies in the consolidated financial statements.

3. Corporate Governance Status

(1) The Board of Directors Implementation Status (2024)

In 2025, the Board of Directors held eight meetings. The attendance of directors is as follows:

Title	Name	Actual no. of meetings attended	No. of meetings with entrusted attendance	Actual no. of attendance rate (%)	Note
Chairman	Representative of TECO Electric & Machinery Co., Ltd-Wu, Su-Chiu	8	0	100%	Assumed office on February 16, 2025(Expected to attend 8 meetings)
Directors	Liu, Chao-Kai	8	0	100%	(Expected to attend 8 meetings)
Directors	Representative of TECO Electric & Machinery Co., Ltd-Peng, Chi-Tseng	4	0	100%	Resigned from office on August 4, 2025 (Expected to attend 4 meetings)
Directors	Representative of TECO Electric & Machinery Co., Ltd-Liu, An-Bing	8	0	100%	(Expected to attend 8 meetings)
Directors	Representative of TECO Electric & Machinery Co., Ltd-Lin, Jia-Sheng	4	0	100%	Assumed office on August 4, 2025(Expected to attend 4 meetings)
Directors	Representative of TECO Electric & Machinery Co., Ltd-Tien, Ying-Juei	8	0	100%	(Expected to attend 8 meetings)
Directors	Yang, Shih-Chien	8	0	100%	(Expected to attend 8 meetings)
Independent Directors	Chen, Shui-Lien	8	0	100%	(Expected to attend 8 meetings)
Independent Directors	Lin, Chiang-Liang	8	0	100%	(Expected to attend 8 meetings)
Independent Directors	Lee, Feng Ao	7	1	87.5%	(Expected to attend 8 meetings)
Actual Attendance Rate of All Board Members = 98.6%
(Total Actual Attendance of All Directors / Total Expected Attendance of All Directors = 71 / 72 = 98.6%)
Other matters to be disclosed:
1. If the board of directors operates under any of the following circumstances, the dates of the board meetings, the agenda, the opinions of all independent directors, and The Company's handling of the opinions of independent directors should be stated:
(1) Matters listed under Article 14-3 of the Securities Exchange Law: Please refer to pages 17-19 of this year's annual report for details on the Audit Committee's operations. All proposals were approved by all independent directors.
(2) Apart from the matters mentioned above, there were other resolutions of the Board of Directors where independent directors expressed opposition or reservations and such dissenting opinions were recorded or documented in writing: No such circumstances exist
2. The execution status of directors abstaining from voting due to a conflict of interest should be disclosed, including the name of the director, the agenda, the reason for abstention, and their participation in the vote.
Board of Directors Date / Term	Directors' Name	Agenda Item	Reason for Recusal
August 6, 2025 22nd Term, 9th Meeting	Mr. Liu Chao-Kai / Ms. Wu Su-Chiu	Compensation for the outgoing Chairperson and the newly appointed Chairperson.	Chairperson Wu Su-Chiu and Director Liu Chao-Kai had a conflict of interest and therefore recused themselves from the discussion and voting. The proposal was approved with the consent of the other attending directors, with Independent Director Lin Chiang-Liang acting as chairperson pro tempore.
September 15, 2025 22nd Term, 10th Meeting	Ms. Wu Su-Chiu	Compensation for the Chairperson.	Chairperson Wu Su-Chiu had a conflict of interest and therefore recused herself from the discussion and voting. The proposal was approved with the consent of the other attending directors, with Independent Director Lin Chiang-Liang acting as chairperson pro tempore.

-14-

-15-

As a listed company, The Company should disclose information regarding the self-evaluation (or peer evaluation) of the board of directors, including the evaluation cycle, scope, method, and content. The Company should also fill out section 2 on the execution status of the board of directors' evaluation. Please refer to page 16 of this year's annual report for detailed information.
Objectives for Strengthening Board Functions in the Current and Most Recent Fiscal Years (e.g., establishment of the Audit Committee, enhancement of information transparency) and Evaluation of Implementation

(1) Board Operations
The operations of the Company’s Board of Directors are conducted in accordance with the Articles of Incorporation and relevant laws and regulations. All directors possess the professional knowledge, skills, and competence necessary to perform their duties, and act in good faith and with due loyalty to maximize the interests of all shareholders.

(2) Enhancement of Corporate Governance
Upon approval by the Board of Directors, the Company has adopted the Ethical Corporate Management Best Practice Principles, the Procedures for Ethical Management and Guidelines for Conduct, and the Corporate Governance Best Practice Principles, and continues to revise and update such policies in accordance with applicable laws, regulations, and operational practices.

(3) Enhancement of Information Transparency
The Company’s financial statements are periodically audited (or reviewed) by PricewaterhouseCoopers Taiwan. They are announced within the timeframe required under the Corporate Governance Evaluation regulations. In addition, all other disclosures required by applicable laws and regulations are completed accurately and in a timely manner. The Company has also established a Corporate Governance Officer to ensure that all material information is disclosed promptly and appropriately, enabling shareholders and stakeholders to access relevant financial and operational information through the Market Observation Post System (MOPS) or the Company’s website in a timely manner.

Board of Directors Evaluation Implementation Status

Evaluation Cycle	Evaluation Period	Evaluation Scope	Evaluation Method	Evaluation Content
Annually	1,1,2025~12,31,2025	Board of Directors' Performance Evaluation	Self-assessment questionnaire for "Board of Directors' Performance Evaluation"	The measurement items of the "Board of Directors' Performance Self-Evaluation Questionnaire" include five aspects: participation in company operations, improvement of the quality of board decision-making, composition and structure of the board, selection and continuous education of directors, and internal control, totaling 45 items.
		Director Members' Performance Evaluation	Self-assessment questionnaire for "Director Members' Performance Evaluation"	The measurement items of the "Director Members; Performance Self-Evaluation Questionnaire" include six aspects: understanding of company goals and tasks, awareness of director responsibilities, participation in company operations, internal relationship management and communication, professional knowledge and continuous education of directors, and internal control, totaling 23 items.
		Functional Committees' (Audit Committee, Remuneration Committee) Performance Evaluation	Self-assessment questionnaire for "Functional Committees' Performance Evaluation"	The measurement items of the "Functional Committee Performance Self-Evaluation Questionnaire" include five aspects: participation in company operations, understanding of functional committee responsibilities, improvement of the quality of functional committee decision-making, composition and member selection of the functional committee, and internal control, totaling 26 items.

The Company has adopted the Board Performance Evaluation Rules in accordance with Article 37 of the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies. Matters relating to the Board performance evaluation were completed in January 2026, and the evaluation results were reported to the Board of Directors on March 9, 2026. The annual self-evaluation of the performance of each functional committee was also completed in January 2026 and reported to the Board of Directors on March 9, 2026.

(2) Audit Committee Implementation Status

The committee consists of three members, all of whom are independent directors of the board.
The Audit Committee is established to assist the Board of Directors in overseeing the quality and integrity of the Company’s accounting, auditing, financial reporting processes, and internal controls.

In fiscal year 2025, the Audit Committee primarily reviewed the following matters:

Quarterly and annual financial reports., Revisions to the internal control system and related key policies, Assessment of the effectiveness of internal controls, Appointment and remuneration of the certified public accountants, Review and approval of the 2026 annual audit plan

In 2025, the Audit Committee held 6 meetings. The attendance of the Independent Directors is as follows:

Title	Name	Actual no. of meetings attended	No. of meetings with entrusted attendance	Actual no. of attendance rate (%)	Note
Independent Directors	Lin, Chiang-liang	6	0	100%	(Expected to attend 8 meetings)
Independent Directors	Lee, Feng-Ao	6	1	83.33%	(Expected to attend 8 meetings)
Independent Directors	Chen, Shui-Lien	6	0	100%	(Expected to attend 8 meetings)
Other matters to be disclosed:
1. If the Audit Committee operates under any of the following situations, the date of the board meeting, agenda, resolution of the Audit Committee, and The Company's handling of the opinions of the Audit Committee shall be disclosed.
(1) Matters listed under Article 14-5 of the Securities Exchange Law:
Board of Directors’ Meeting Date/Cycle.	Agenda Content.			Dissenting Opinions, Qualified Opinions, or Major Recommendations from Independent Directors	Resolution of the Audit Committee and the Company’s Response to the Audit Committee’s Opinions
03.05.2025 The 22nd-5th Section	The Company’s 2024 Business Report and Financial Statements.			Approved by all attending committee members.	None
	The Company’s 2024 Loss Appropriation Proposal.			Approved by all attending committee members.	None
	Appointment of the auditor for 2024, and assessment of their independence and suitability for remuneration.			Approved by all attending committee members.	None
	Evaluation of the effectiveness of the Company’s 2024 internal control system and the Internal Control System Statement (declaring the internal control system effective).			Approved by all attending committee members.	None
05.13.2025 The 22nd-6th Section	The Company’s Q1 2025 consolidated financial statements.			Approved by all attending committee members.	None
08.06.2025 The 22nd-9th Section	The Company’s Q2 2025 consolidated financial statements.			Approved by all attending committee members.	None

-17-

-18-

| 10.31.2025
The 22^{nd}-11^{th} Section | The Company’s Q3 2025 consolidated financial statements. | | Approved by all attending committee members. | None |
| --- | --- | --- | --- | --- |
| | Conversion of the Company’s privately placed Class A preferred shares into privately placed common shares. | | Approved by all attending committee members. | None |
| | The Company’s 2026 audit plan. | | Approved by all attending committee members. | None |
| 12.17.2025
The 22^{nd}-12^{th} Section | The Company’s 2026 operating budget. | | Approved by all attending committee members. | None |
| | Change of the Company’s Chief Accounting Officer and spokesperson. | | Approved by all attending committee members. | None |
| | Proposal to abolish the Mobile Communications Branch. | | Approved by all attending committee members. | None |

(2) Other matters that were not approved by the Audit Committee but were approved by over two-thirds of the entire Board of Directors:

Audit Committee Date / Term	Agenda Item	Dissenting Opinions, Qualified Opinions, or Major Recommendations from Independent Directors	Resolution of the Board of Directors
2025.12.17
22^{nd} Term, 12^{th} Meeting	Compensation proposal for the newly appointed Chief Accounting Officer.	None	Approved with the consent of all attending directors upon consultation by the Chairperson.

Regarding the execution of recusal by independent directors in matters related to conflicts of interest, the report should include the names of the independent directors, the content of the matters, the reasons for recusal, and their participation in the voting: No such circumstances exist
Communication between the independent directors and the internal audit manager and the auditor:

(1) The Audit Committee regularly communicates and understands the financial reports, newly issued accounting standards, and other matters with the auditor; the audit report is legally submitted to the Audit Committee for review, and the audit manager attends the Audit Committee meeting to report.

(2) The communication between the independent directors and the internal audit manager was positive, and the independent directors have no further comments. The summary of the main communication matters for the 2025 fiscal year is as follows:

Audit Committee Date/Cycle	Communication Matters	Communication Results
03.05.2025
The 4^{th} meeting of the 3^{rd} session	Internal Audit Business Report of The Company.	Understood
	The "Internal Control Systems" (affirming the effectiveness of internal controls) for the year 2024 of The Company.	Approved after deliberation, and will be submitted to the Board of Directors for resolution.
05.13.2025
The 5^{th} meeting of the 3^{rd} session	Internal Auditor's Report of The Company.	Understood
08.06.2025
The 6^{th} meeting of the 3^{rd} session	Internal Auditor's Report of The Company.	Understood
10.31.2025
No general directors or managers were present.	1. Report on the implementation of the 2025 internal audit operations.
2. Explanation of the 2026 audit plan.	Acknowledged with no further recommendations.

| 10.31.2025
The 8^{th} meeting of the
3^{rd} session | Internal Auditor’s Report of The Company. | Understood |
| --- | --- | --- |
| | The Company’s 2026 Internal Audit Plan. | Reviewed and approved, and submitted
to the Board of Directors for resolution. |
| 12.17.2025
The 6^{th} meeting of the
3^{rd} session | Internal Auditor’s Report of The Company. | Understood |
| (3) The communication between the independent directors and the signing auditor was positive, and the
independent directors have no further suggestions. The summary of the main communication matters for the 2025
fiscal year is as follows: | | |
| Audit Committee
Date/Cycle | Communication Matters | Communication Results |
| 03.05.2025
The 4^{th} meeting of the
3^{rd} session | The business report and financial report for the year
2024 of The Company. | Reviewed and approved, and submitted
to the Board of Directors for resolution. |
| 05.13.2025
The 5^{th} meeting of the
3^{rd} session | The consolidated financial report for the Q1 of 2025 of
The Company. | Reviewed and approved, and submitted
to the Board of Directors for resolution. |
| 08.06.2025
The 6^{th} meeting of the
3^{rd} session | The consolidated financial report for the Q2 of 2025 of
The Company. | Reviewed and approved, and submitted
to the Board of Directors for resolution. |
| 10.31.2025
No general directors
or managers were
present. | 1. Independence and responsibilities of the financial.
report reviewers and the accounting firm.
2. Review conclusion, scope, and findings of the.
Company’s Q3 2025 financial statements.
3. Updates on significant regulations. | 1. The financial statements were
approved by the Audit Committee
and the Board of Directors, and were
announced and filed on schedule.
2. The Company fully cooperated in
order to meet the requirements of the
competent authorities. |
| 10.31.2025
The 8^{th} meeting of the
3^{rd} session | The consolidated financial report for the Q2 of 2025 of
The Company. | Reviewed and approved, and submitted
to the Board of Directors for resolution. |

(3) Corporate Governance and its Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
1. Has The Company established and disclosed corporate governance practices in accordance with the “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”?	v		1. The Company has established a “Corporate Governance Best Practice Principles” to ensure good corporate governance and pursue maximization of shareholder rights and sustainable management.	No significant difference
2. Company shareholding structure and shareholder rights:
(1) Has The Company established internal operating procedures for handling shareholder proposals, questions, disputes, and litigation, and implemented them according to the procedures?	v		(1) The Company has established a spokesperson and a proxy spokesperson in accordance with regulations to handle shareholder suggestions, questions, disputes, and litigation matters.	(1) No significant difference
(2) Does The Company have a list of the major shareholders and the ultimate controllers of those shareholders?	v		(2) The Company has entrusted a professional shareholder service agency to handle relevant matters and regularly report related information in accordance with regulations. The Company always maintains an understanding of the shareholding situation of insiders and major shareholders holding more than 10% of the shares at any time.	(2) No significant difference
(3) Has The Company established and implemented risk control and firewall mechanisms between related companies?	v		(3) The Company has established relevant control measures in the internal control system and subsidiaries supervision and control operations procedures for all business dealings with related enterprises, which are treated as independent third parties except for independent operations.	(3) No significant difference
(4) Has The Company established internal regulations prohibiting insiders from trading securities based on undisclosed information?	v		(4) The Company has also established the "Prevention of Insider Trading Management and Handling Procedures for Material Non-Public Information" to prohibit insider trading of securities using undisclosed information. Relevant guidelines are provided to internal personnel for dissemination and reminders are given on matters related to insider trading every year.	(4) No significant difference
3. Composition and responsibilities of the board of directors:
(1) Has the board of directors formulated a diversity policy, specific management goals, and implemented them?	v		(1) The composition of the Board of Directors of The Company emphasizes diversity. Board	(1) No significant difference

-20-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(2) Has The Company voluntarily established other functional committees in addition to the required remuneration and audit committees?	v		members possess expertise in business judgment, management, industry knowledge, leadership, and decision-making capabilities. Among them, four directors have professional backgrounds in finance and accounting. The Board is composed of individuals with comprehensive academic and professional experience, ensuring a well-rounded and diverse structure. There are nine director seats, including three independent directors, and two female directors. The specific management goal of "the number of directors who concurrently serve as company managers shall not exceed one-third of the total number of directors",and members of the Board of Directors actively attended Board meetings in 2025, the actual attendance rate of directors was 98.6%, demonstrating effective supervision of and understanding of the implementation of operating plans and related matters.These enable The Company to fulfill its functions in decision-making and supervision. Please refer to page 8 of this year's annual report for detailed information.
(3) Has The Company established a performance evaluation method for the board of directors and its evaluation process, conducted annual evaluations, reported the results to the board of directors, and used them as a reference for individual director compensation and nomination for reappointment?	v	(2)	The Company has established a “remuneration Committee” and an "Audit Committee" and has defined their responsibilities in accordance with the Securities Exchange Law. In the future, The Company will establish other functional committees as required by laws and regulations and The Company's operating scale.	(2) The current organizational structure of The Company meets operational needs. We will consider setting up other functional committees in the future depending on The Company's business scale.
			(3) The Company’s Board of Directors approved the Board Performance Evaluation Rules on August 13, 2019. The 2025 performance evaluations, including the Board Performance Evaluation, Director Performance Evaluation, Remuneration Committee Performance Evaluation, and Audit Committee Performance Evaluation, were completed in January 2026. The	(3) No significant difference

-21-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(4) Does The Company regularly evaluate the independence of the accountant?	v		evaluation results were submitted to the 13th meeting of the 22nd Board of Directors on March 9, 2026. In addition, the results of individual director performance evaluations serve as a reference for the selection or nomination of directors and independent directors.

(4) As required by Article 29 of the Corporate Governance Best Practice Principles, The Company should evaluate the independence and suitability of its appointed accountants regularly, at least once a year. The Company's finance unit evaluates the independence and suitability of the appointed accountants using the "Assessment Form for CPAs Independence and suitable Audit Accountants." Two accountants were evaluated and found to meet the independence and suitability assessment criteria of The Company and are considered qualified to be the accountants for The Company. The evaluation results were submitted for review and approved by the 10^{th} session of the 3^{rd} Audit Committee (on March 9, 2026), and were discussed and approved at the 13^{th} session of the 22^{nd} Board of Directors (on March 9, 2026) regarding the assessment of the independence and suitability of the signing accountants. | (4) No significant difference |
| 4. Do listed companies have appropriate and adequate corporate governance personnel, and designate a corporate governance officer responsible for corporate governance related matters (including but not limited to providing information necessary for board of directors to carry out business, assisting directors and supervisors in complying with laws, handling matters related to board of directors and shareholder meetings in accordance with the law, preparing board of directors and shareholder meeting minutes, etc.)? | v | | According to the "Guidelines for the Establishment and Exercise of Powers by the Board of Directors of Listed Companies," The Company established a governance officer in the 21st 12th Board of Directors meeting on March 24, 2023. | No significant difference |
| 5. Has The Company established communication channels with stakeholders (including but not limited to shareholders, employees, customers, and | v | | To respond to various stakeholders, including shareholders, employees, customers, and suppliers, The Company provides communication | No significant difference |

-22-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
suppliers), set up a stakeholder area on The Company's website, and properly responded to important corporate social responsibility issues raised by stakeholders?			channels and practices based on their concerns, implements corporate governance integrity and transparency, and establishes a stakeholder section and corresponding contact information on The Company's website to address issues related to corporate sustainability, social responsibility, and other relevant topics.
6. Has The Company appointed a professional shareholder service agency to handle shareholder meeting affairs?	v		The Company has appointed Taishin Securities Agency Department as our shareholder meeting agent.	No significant difference
7. Information disclosure:
(1) Has The Company set up a website to disclose financial and corporate governance information?
(2) Does The Company use other methods for information disclosure (such as setting up an English website, designating a person in charge of collecting and disclosing company information, implementing a spokesperson system, and posting the process of corporate briefings on The Company's website)?
(3) Does The Company announce and file annual financial reports within two months after the end of the fiscal year, and disclose and file quarterly financial reports for the first, second, and third quarters, as well as monthly operating results within the prescribed time limit?	v	v	(1) The Company discloses financial, operational, and corporate governance information in a timely manner through its official website (www.tecom.com.tw).
(2) The Company has established both Chinese and English websites to provide relevant information. Ms. Li, Mei-Ling, Chief Financial Officer, has been appointed as the spokesperson, and Ms. Wang, Yen-Li, Accounting Manager, serves as the deputy spokesperson. All material information that may affect shareholders and stakeholders is disclosed promptly and appropriately. Presentations and related materials for institutional investor conferences are also available on the Company’s website.
(3) The Company's annual financial reports, quarterly reports for the first, second, and third quarters, and monthly operating results are all announced and reported in compliance with laws and regulations.	(1) No significant difference
(2) No significant difference
(3) No significant difference
8. Does The Company have other important information that helps understand the corporate governance status(including but not limited to employee benefits, employee care, investor relations, supplier relations, stakeholder rights, director training, the implementation of risk management policies and risk measurement standards, the implementation of customer policies, and The Company's purchase of liability insurance for directors.)?	v		(1) Employee Rights: All regulations and measures relating to labor-management relations are established in accordance with the Labor Standards Act, which serves as the minimum standard for the Company’s personnel management rules. Any new or revised measures concerning labor-management relations are finalized only after full consultation and communication between labor and management, with the aim of protecting	(1)No significant difference

Evaluation Item	Implementation Status
	Yes	No	Abstract Illustration
			employee rights and achieving a win-win outcome for both parties.
(2) Employee Care: The Company has established an Employee Welfare Committee. Through the operation of the welfare committee elected by employees, various welfare matters are administered. In addition, retirement reserves and contributions are made in accordance with the Labor Standards Act and the Labor Pension Act.
(3) Investor Relations: The protection of shareholders’ rights and interests is the Company’s primary objective. To facilitate investors’ understanding of the Company’s operations, the Company not only discloses information on the Market Observation Post System (MOPS) in accordance with regulations, but has also established an “Investor Relations” section on its website, where financial information is updated regularly. Investors may also submit suggestions via email, telephone, or the website, and designated personnel are assigned to handle such matters.
(4) Sustainable Development: The Company has adopted the Sustainable Development Best Practice Principles and continues to promote corporate governance, environmental sustainability, social welfare, and enhanced disclosure of corporate social responsibility information.
(5) Director Professional Development: The Company’s directors are professionals in their respective fields. The Company provides directors with relevant legal and regulatory updates as needed, and the management team regularly delivers business and other related briefings to the Board. The Company also complies with the Directions for the Implementation of Continuing Education for Directors and Supervisors of TWSE/TPEx Listed Companies. Please refer to	(2)No significant difference

(3)No significant difference

(4)No significant difference

(5)No significant difference |

-24-

Evaluation Item	Implementation Status
	Yes	No	Abstract Illustration
			pages 42–43 of this annual report or disclosures on the MOPS for further details.
(6) Implementation of Risk Management Policies and Risk Measurement Standards: The Company has established various management regulations, including the Procedures for Acquisition or Disposal of Assets, Procedures for Endorsements and Guarantees, and Regulations Governing Loans of Funds to Others, which serve as the basis for risk control and risk measurement standards for the operating and internal audit units when carrying out the above operations.
(7) Implementation of Customer Policy: The Company provides customers with comprehensive services and protection. Customer complaints are addressed promptly through full communication to understand customer needs, thereby enhancing interaction between the Company and its customers. Relevant matters are also reviewed and improved from time to time during internal meetings.
(8) Directors’ and Officers’ Liability Insurance: The Company purchases liability insurance for directors and managerial officers on an annual basis, and reports the key details of such insurance coverage to the Board of Directors.	(6)No significant difference

(7)No significant difference

(8)No significant difference |
| 9. Please explain the improvements in the recent year's corporate governance evaluation results released by the Corporate Governance Center of Taiwan Stock Exchange Corporation, and provide priority strengthening measures for areas that have not yet been improved. (Companies that have not been evaluated can be omitted.) | | v | The Company is not included in the evaluated companies list. | Not applicable. |

-25-

(Appendix 1) CPA Review Form

Evaluation Item	Evaluation Content	Evaluation Result
A) Review of Independence Requirements	1 Do the CPA, their spouse, or minor children have any investment or financial interest in the Company?	N
	2 Do the CPA, their spouse, or minor children have any lending or borrowing relationship with the Company? (This does not apply if the client is a financial institution with normal dealings.)	N
	3 Are the CPA or members of the audit engagement team currently, or have they within the past two years served as a director, officer, or held a position with significant influence over the audit at the Company?	N
	4 Have the CPA or audit engagement team members promoted or brokered the Company's issuance of shares or other securities?	N
	5 Have the CPA or audit engagement team members, beyond services permitted by law, acted as legal representatives of the Company in legal or other dispute matters with third parties?	N
	6 Do the CPA or audit engagement team members have a spouse, direct blood relative, in-law, or collateral relative within the second degree of kinship who is a director, officer, or holds a position with significant influence over the audit at the Company?	N
	7 Has any retired partner within the past year served as a director, officer, or held a position with significant influence over the audit at the Company? No	N
	8 Have the CPA or audit engagement team members accepted substantial gifts or special favors from the Company or its directors, officers, or major shareholders?	N
	9 Is the CPA currently employed by the client or audited entity in a regular position with fixed salary, or serving as a director or supervisor (audit committee member)?	N
Evaluation Item	Evaluation Content	Evaluation Result
B) Review of Independence Practices	1 Has the CPA recused themselves from handling matters where they have direct or significant indirect interest that may impair their impartiality and independence?	Yes
	2 In providing audit, review, re-examination, or special audit services and issuing opinions on financial statements, has the CPA maintained both actual and apparent independence?	Yes
	3 Do members of the audit engagement team, other joint CPAs, firm partners, the CPA firm, its affiliates, and associated firms also maintain independence from the Company?	Yes
	4 Does the CPA uphold a professional attitude of integrity and diligence in executing their services?	Yes
	5 While executing professional services, does the CPA maintain an impartial and objective stance, avoiding any prejudice, conflict of interest, or relationships that could impair professional judgment?	Yes

Evaluation Item	Evaluation Content	Description	Evaluation Result
C) Review of Competency	1 Has the CPA been subject to any disciplinary action by the CPA Disciplinary Committee in the past two years? Has the CPA firm been involved in any major lawsuits in the past two years or currently?	CPAs Mr. Chiang Cheng-Han and Ms. Liu Chien-Yu have not been listed in any disciplinary announcements by the Financial Supervisory Commission's Securities and Futures Bureau.	Good
	1 Does the CPA firm have sufficient scale, resources, and regional coverage to perform audit services for the Company?	PwC Taiwan, the local affiliate of the world’s largest CPA firm PwC, has affiliate firms in all major regions where the Group operates, ensuring timely and local handling of relevant matters.	Good
	2 Does the CPA firm have clearly defined quality control procedures to ensure the quality of financial reporting?	The appointed CPA firm has established clear quality control procedures to reasonably ensure effective execution. These procedures include internal control systems set in accordance with Audit Standard Bulletin No. 46, “Quality Control for CPA Firms.”	Good
	2 Does the CPA firm promptly inform the Board of Directors of any significant issues or developments related to risk management, corporate governance, financial accounting, or related risk control?	The appointed PwC CPAs have consistently communicated audit findings with the Company’s management and audit committee in a timely manner, with early involvement in key issues.	Good

-27-

(4) Remuneration Committee Implementation Status
1. Remuneration Committee Members' Information

Identity (Note 1)	Name	Professional Qualifications and Experiences	Independence Status (Note 2)	Number of other publicly listed companies' remuneration committee memberships held concurrently.
Independent Directors	Chen, Shui Lien	Honorary Professor of Management Science Department at Tamkang University with a degree in finance and accounting-related fields and no circumstances falling under any subparagraph of Article 30 of The Company Act.	1. Not an employee of The Company or its affiliates.
2. Not a director or supervisor of The Company or its affiliates.
3. Not a natural person shareholder who, together with his/her spouse, minor children, or shareholders who hold more than 1% of the total issued shares of The Company or among the top ten shareholders of The Company, holds more than 1% of the total issued shares of The Company in his/her own name or in the name of others.
4. Not a manager or a person listed in 2 or 3 above, his/her spouse, his/her relatives within the second degree of kinship, or his/her lineal relatives within the third degree of kinship.
5. Not a director, supervisor, or employee of a corporate shareholder who holds directly more than 5% of the total issued shares of The Company, is among the top five shareholders, or is appointed as a director or supervisor of The Company pursuant to Article 27, Paragraph 1 or Paragraph 2 of The Company Act.
6. Not a director, supervisor, or employee of another company or institution whose board of directors or voting rights exceeding half of The Company's board of directors or supervisor seats is controlled by the same person.
7. Not a director or supervisor of another company or institution whose chairman or general manager or equivalent position is the same person or spouse of The Company's chairman or general manager.
8. Not a director, supervisor, manager or shareholder holding more than 5% of the shares of a specific company or institution that has financial or business dealings with The Company.
9. Not a professional, sole proprietor, partner, company or organization owner, partner, director, supervisor, manager, or spouse thereof who provides professional services such as business, legal, financial, or accounting related services to The Company or its affiliates and has not received cumulative compensation exceeding NTD 500,000 in the past two years.	0
Independent Directors	Lin, Chiang-liang	Professor of Accounting Department at Chung Yuan Christian University with a degree in finance and accounting-related fields and no circumstances falling under any subparagraph of Article 30 of The Company Act.		3
Independent Directors	Lee, Feng Ao	Holding a lawyer certificate obtained through passing the national examination, currently serving as the managing partner of Balance Law Firm, and no circumstances falling under any subparagraph of Article 30 of The Company Act.		0

-28-

Remuneration Committee Implementation Status

(1) The Remuneration Committee of The Company consists of three members.

(2) Responsibilities of the Remuneration Committee: The primary function of the Remuneration Committee is to strengthen corporate governance and to attract and retain talent by evaluating and overseeing the compensation policies for the Company's directors and managerial officers. Its main responsibilities include the periodic review of performance evaluation mechanisms and the remuneration policies and systems for directors and managers, as well as the assessment and determination of their individual compensation packages.

(3) The term of office for the current committee is from August 12, 2024 to June 17, 2027. The Remuneration Committee held three meetings in 2025, and the membership and attendance of the committee are as follows:

Title	Name	Actual no. of meetings attended	No. of meetings with entrusted attendance	Actual no. of attendance rate (%)
Convener	Chen, Shui Lien	3	0	100%
Member	Lin, Chiang-liang	3	0	100%
Member	Lee, Feng Ao	3	0	100%
Other matters to be disclosed:
1. If the board of directors does not adopt or amend the recommendations of the Remuneration Committee, the date, agenda, resolution, and The Company's handling of the Remuneration Committee's opinions shall be described: None.
2. If there are any objections or reservations with a recorded or written statement from any members of the Remuneration Committee regarding its decisions, the date, agenda, content, all members' opinions, and the handling of such opinions shall be described: None.
3. The main communication matters and summary of resolutions for the year 2025 are as follows:
Remuneration Committee Date/Cycle	Communication Item			Communication Result
08.06.2025
The 3^{rd} meeting of the 6^{th} session	Directors’ compensation and benefits proposal			Approved and submitted to the board of directors for resolution.
	Chairperson compensation proposal			Approved and submitted to the board of directors for resolution.
08.27.2025
The 2^{nd} meeting of the 6^{th} session	Withdrawal of the Chairperson compensation proposal			Approved and submitted to the board of directors for resolution.
12.08.2025
The 5^{th} meeting of the 6^{th} session	Regular evaluation of the reasonableness of managerial officers’ compensation			All attending committee members confirmed that the compensation of the Company’s managerial officers was reasonable.
	Approved with the consent of all attending committee members.			Approved and submitted to the board of directors for resolution.

-29-

(5) Implementation of sustainable development and differences and reasons for differences between The Company's Sustainable Development Best Practice Principle and the practice guidelines for listed companies.

Evaluation Item	Implementation Status
	Yes	No	Abstract Illustration
1. Has The Company established a governance structure to promote sustainable development, with a dedicated unit responsible for this task, and authorized and supervised by the board of directors?	v		The Company adopted the Sustainable Development Best Practice Principles upon approval by the Board of Directors on August 12, 2024, and has established a dedicated (or concurrently assigned) unit for sustainable development. This unit is responsible for sustainability policies, systems, related management guidelines, specific promotion plans, and implementation, and reports the progress of such implementation to the Board of Directors on a quarterly basis.
The Company has also established the Sustainability Information Management Procedures and the Procedures for Preparation and Filing of Sustainability Reports, and regularly discloses sustainability-related measures in its annual report, on the Market Observation Post System (MOPS), and in its sustainability report.	No significant difference
2. Has The Company conducted risk assessments related to environmental, social, and governance issues that are relevant to its operations, based on the principles of materiality, and developed relevant risk management policies or strategies?	v		(1) The scope of risk assessment for the current year covers TECO Electric &Machinery Co., Ltd. and its subsidiaries, GDH CO., LTD. and Wuhan Tecom Technology Co., Ltd. These entities are included in the assessment scope in consideration of their relevance to the Company’s core operations and their level of impact on material topics.
(2) In addition to identifying major issues related to corporate governance—such as socio-economic and legal compliance, strengthening the functions of the Board of Directors, and stakeholder engagement—the Company develops corresponding management strategies. Through the preparation of the Sustainability Report, it identifies environmental, social, and other material risks by defining assessment criteria, processes, and outcomes, along with relevant risk management policies or strategies.	No significant difference

-30-

Evaluation Item	Implementation Status
	Yes	No	Abstract Illustration
3. Environmental Issues
(1) Has The Company established an appropriate environmental management system based on its industry characteristics?
(2) Is The Company committed to improving energy efficiency and using renewable materials with low environmental impact?
(3) Has The Company assessed the potential risks and opportunities of climate change for its current and future operations and taken measures to address climate-related issues?	v		(1) Relevant internal management operations are carried out in accordance with ISO system requirements.
(2) The Company has taken various measures to reduce the impact of operations on the natural environment, such as using energy-efficient lighting equipment for indoor lighting, setting a minimum temperature for air conditioning, cleaning the air conditioning filter to improve efficiency, recycling waste paper, sorting garbage, and reducing the amount of waste. The energy-saving effect is more than 1% per year.
(3) In the second half of 2025, the Company completed a preliminary assessment of climate change risks. The Company evaluates the potential risks and opportunities of climate change on The Company's current and future operations, considers relevant regulations of environmental protection authorities and stakeholder requirements, and formulates annual energy-saving measures and targets. The Company collaborates with the Ministry of Economic Affairs to implement various energy-saving programs and achieves an annual energy-saving rate of more than 1%. The energy-saving rate for 2024 and 2025 were 11.2% and 0.67%.	(1) No significant difference
(2) No significant difference
(3) No significant difference

-31-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(4) Has The Company compiled greenhouse gas emissions, water usage, and total waste weight for the past two years and developed policies to reduce energy consumption and carbon emissions, reduce water usage, or manage other waste?	v		Greenhouse Gas Emission Management:
•Recent Greenhouse Gas Emissions The Company’s 2025 GHG inventory results have been disclosed in the chapter on Climate-Related Information for Listed and OTC Companies in this annual report. Internally, we have launched company-wide education and awareness programs on resource conservation, along with periodic inspections, to effectively prevent unnecessary resource waste.
Water Resource Management:
•Water usage in the past three years	(4) No significant difference
			Year Water Consumption
			2023 18,369 m³
			2024 15,426 m³
			2025* 18,545 m³
			*Note:The reporting boundary for 2025 includes the subsidiaries BAYCOM and TECOM Wuhan.
Management effectiveness: Due to business needs, the Company’s water consumption increased by 3,119 cubic meters during the current year. As a responsive measure, the Company will continue to reduce water resource usage through ongoing technical improvements.
Waste Management:
•Quantity of hazardous and non-hazardous waste in the past three years
			Year Waste Production (tons)
			2023 5.25
			2024 4.36
			2025 4.91
			Management Effectiveness: Continue to adopt life-cycle management principles and promote strategies such as source reduction and waste reuse.
4. Social Issues
(1) Has The Company developed management policies and procedures in accordance with relevant laws and international human rights conventions?	v		(1) The Company actively practices corporate social responsibility in accordance with the international trend of balancing environmental, social, and corporate governance development. We comply with relevant labor laws and respect internationally recognized basic labor rights principles to protect the legitimate rights and interests of our employees. We have established relevant management regulations	(1) The Company will disclose information related to corporate sustainability on The Company website and the public information disclosure platform as

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(2) Has The Company established reasonable employee welfare measures (including salary, leave, and other benefits) and appropriately reflected its business performance or results in employee compensation?	v		and systems to treat our employees in a legal, fair, and friendly manner and expect our supply chain partners to follow suit.

(2) 1. The Company has established a staff welfare committee to promote various welfare measures and plan employee care and support policies to enhance employee health and abilities.
2. We disclose and implement various allowances, bonuses, subsidies, retirement systems (including the establishment of a retirement reserve fund committee, regular meetings to determine the allocation ratio and situation of the old and new systems, and the employee retirement application process and conditions), and leave systems on our internal website.
3. The Company has implemented flexible working hours, allowing employees to adjust their start and end times with greater flexibility.
4. The business department has established a performance bonus system under which operating results are reflected in compensation, allowing employees to share in the Company’s achievements. | needed or required by law in the future.

(2) No significant difference |
| (3) Does The Company provide employees with a safe and healthy working environment and regularly conduct safety and health education for employees? | v | | (3) The Company complies with relevant laws and regulations on occupational safety and health, and we have qualified first-aid personnel and sufficient first-aid kits. We provide labor safety and health education and training to new and existing employees before they change jobs, and we have established lactation rooms in accordance with the Gender Equality in Employment Act. Additionally, we have established an emergency response team and defined emergency response management procedures to respond to any emergency situation that may cause loss of life, property, and environmental pollution, including power outages, water outages, fires, floods, typhoons, earthquakes, | (3) No significant difference |

-33-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(4) Has The Company established an effective career development training plan for employees?	v		personnel injuries (temporary or permanent disability), food poisoning, statutory communicable diseases (such as SARS/Covid-19), water pollution, and any other emergency situation. The Company also arranges for a licensed nurse to visit the office four times per month to provide employees with professional health consultations. In 2025, the company recorded zero fire incidents, with no injuries or fatalities, and the ratio of injured or deceased employees to the total number of employees was zero.
(5) Does The Company comply with relevant laws and international standards regarding customer health and safety, customer privacy, marketing and labeling, and develop relevant policies and complaint procedures to protect consumer or customer rights?	v		(4) The Company has established a comprehensive employee training program and provides diversified training courses tailored to different positions, expertise, and needs. At the same time, the Company supports employees’ competency development, enhances professional capabilities, and provides second-skill development programs when appropriate to enrich employees’ career paths.	(4) No significant difference
	v		(5) In 2025, total training hours for new employees amounted to 240 hours, while the total hours of internal and external training courses reached 1,275 hours. Details of the training programs are disclosed in the Employee Rights and Benefits section of the Sustainability Report.The Company strictly adheres to environmental protection laws and regulations in product design and manufacturing, striving to achieve the standards of world environmental protection policies. We effectively control raw materials and processes to ensure that the products we provide meet the specifications of ROHS. We respect customer privacy and comply with confidentiality agreements and personal data protection laws. At the same time, we provide standardized and effective complaint procedures for our products and services. If there	(5) No significant difference

-34-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
(6) Has The Company developed a supplier management policy requiring suppliers to comply with relevant regulations in environmental protection, occupational safety and health, or labor rights, and implemented it effectively?			are any relevant issues, customers can directly contact our business personnel provided on The Company's website to protect consumer rights and provide complaint channels.

(6) The Company has established a "Supplier Code of Conduct" to require suppliers to comply with this code in their business conduct, including labor, health and safety, environment, business ethics, and management systems. We also require suppliers to fully comply with the laws and regulations of their operating countries/regions. At the same time, we conduct regular audits, and the audit results are also one of the important factors for The Company's decision-making. The Company will continue to uphold the spirit of mutual trust and mutual benefit with suppliers, and carry out supplier audits and management based on integrity. We confirm that suppliers comply with various environmental protection treaties and social responsibilities to grow together with The Company and create a win-win situation. | (6) No significant difference |
| 5. Has The Company used internationally recognized reporting standards or guidelines to prepare a sustainability report or other non-financial information disclosure report? Has the report obtained the confirmation or assurance opinion of a third-party verification unit? | v | | The Company’s Sustainability Report is prepared in accordance with the GRI and SASB standards. The 2025 report is scheduled for publication and will be disclosed on the Company’s website by the end of August 2026. | (7) No significant difference |
| 6. If The Company has established its own sustainability guidelines based on the "Practice Guidelines for Sustainable Development of Listed Companies", please describe how they operate and the differences between these guidelines and The Company's established guidelines. The Company has established the "Sustainable Development Practice Guidelines." All corporate social responsibility operations are carried out in accordance with the content and related provisions of these guidelines, ensuring full compliance without any discrepancies. | | | | |
| 7. Other important information that helps to understand the implementation of sustainable development: The Company provides various employment and internship opportunities, and employs several individuals with disabilities who possess employment capabilities. Over the years, The Company has been operating with integrity and striving to provide its employees with a stable and healthy environment for personal growth, while maximizing shareholder value and fulfilling its responsibility for sustainable development. | | | | |

-35-

(6) Climate-Related Information for Listed Companies:

Implementation Status of Climate-Related Information

Item	Implementation Status
(1) Describe the board of directors’ and management’s oversight and governance of climate-related risks and opportunities.	Since 2024, the Company has been actively addressing climate change-related issues and promoting the management of climate-related risks and opportunities to ensure the sustainable development of the enterprise.
(2) Explain how identified climate risks and opportunities impact the company’s business, strategy, and financials (short-, medium-, and long-term).	1. Acute Physical Risks (Extreme weather events such as typhoons, flooding, and heatwaves):
Field employees may suffer heat-related injuries due to hot working environments. Power outages and flooding at operating sites may disrupt production and delivery schedules.
Short-term: Labor shortages and increased overtime costs for other employees.
Medium-term: Damage to buildings and equipment at operating sites, resulting in higher maintenance costs and increased outsourcing expenses.
Long-term: Damage to buildings and equipment beyond affordable maintenance capacity.
Response Strategies:
Provide heat hazard prevention training to help employees recognize symptoms of heat stress and strengthen self-protection awareness.
Regularly inspect generator equipment to ensure proper operation and avoid equipment damage caused by power outages or restoration.

Chronic Physical Risks (Long-term temperature rise and changes in precipitation):
Rising temperatures may increase energy consumption and operating costs, while water shortages may affect production and cooling system operations.
Short-term: Increased costs of energy and water resources for operations.
Medium-term: Higher utility costs and the need to seek external suppliers for water resources.
Long-term: Excessive utility costs that become unsustainable.
Response Strategies:
Introduce intelligent management systems for high-energy-consuming equipment and replace obsolete equipment to reduce purchased electricity usage. Strengthen water resource management and promote water-saving technologies.
Policy and Regulatory Risks (Carbon fees and stricter environmental regulations):
Carbon fees may increase operating costs, while stricter regulations requiring higher environmental standards for products may increase R&D costs.
Short-term: No significant impact from carbon emission costs.
However, the use of environmentally friendly materials may increase R&D and raw material costs.
Medium-term: Higher carbon fee rates imposed by the government may increase environmental costs. Products that fail to meet higher environmental standards may reduce customer willingness to purchase.
Long-term: Inability to bear carbon fee expenses and declining customer demand, resulting in reduced revenue.
Although Eastern Communications currently does not incur carbon fee expenses, the Company has established a target of reducing greenhouse gas emissions by 1% annually based on the base-year emissions level.
The Company voluntarily conducts carbon inventories and implements |

-36-

-37-

	carbon reduction strategies. It also adopts green products and plans the R&D and manufacturing of green products to ensure compliance with international environmental standards.
	4. Market and Technology Risks (Low-carbon transition and industry transformation):
Growing awareness of energy saving and carbon reduction may change product demand. Increased investment costs in green technologies may affect short-term financial performance.
Short-term: Products may fail to meet market demand, resulting in a slight decline in order volume. Increased green technology investment may affect short-term financial results.
Medium-term: Market acceptance of non-green products may decline. Long-term: Products may lose market competitiveness entirely, making it difficult to improve profitability.
Response Strategies:
Integrate low-carbon products to enhance customer willingness to purchase. Make early arrangements for a green supply chain to strengthen market competitiveness.
	5. Reputational Risks (Rising stakeholder expectations):
Insufficient communication may undermine investor confidence. Increased customer awareness of environmental protection may affect brand image.
Short-term: No significant impact.
Medium-term: Rising investor awareness and expectations regarding sustainable business operations may reduce investment willingness.
Long-term: Failure to adopt sustainability concepts and actions may damage corporate reputation and revenue.
Response Strategies:
Enhance transparency of sustainability information disclosures.
Integrate energy-saving and low-carbon product portfolios to strengthen the Company’s green brand image.
(3) Describe the financial impacts of extreme climate events and transition activities.	1. Changes in Market Demand:
Customer demand for low-carbon products and services is increasing, and green technology has become a competitive advantage for businesses.
Short-term: No significant impact.
Medium- to Long-term: Improved business performance and revenue growth.
Corporate Actions:
Develop energy-saving and carbon-reduction products to increase market share. Expand green solutions and provide low-carbon digital transformation services.
	2. Development of Renewable Energy:
Declining renewable energy costs improve the economic benefits of using green electricity.
Short-term: No significant impact.
Medium- to Long-term: The use of self-generated renewable energy can reduce purchased energy costs.
Corporate Actions:
Plan the installation of renewable energy generation facilities or purchase renewable electricity to increase renewable energy usage and reduce the Company’s operational carbon footprint.
	3. Policy and Regulatory Support:
The government is promoting corporate low-carbon transformation by providing subsidies and preferential policies. The Financial Supervisory Commission also requires the disclosure of greenhouse gas inventory data and emission reduction response measures.

-38-

| | Short-term: Improved product efficiency.
Medium-term: Enhanced business performance and revenue growth.
Long-term: Improved green corporate image and stable revenue growth.
Corporate Actions:
Integrate internal product resources, strengthen ESG performance, and enhance investor confidence. |
| --- | --- |
| | 4. Enhanced Corporate Resilience:
Low-carbon transformation helps reduce energy costs and improve operational efficiency.
Short-, Medium-, and Long-term: Improved energy efficiency and reduced energy expenses.
Corporate Actions:
Enhance risk management capabilities through digital technology and sustainability strategies. Establish a carbon management system to ensure compliance with future regulatory requirements. |
| (4) Explain how the identification, assessment, and management of climate risks are integrated into the overall risk management framework. | Following TCFD recommendations and industry information, the Company uses scenario analysis to identify climate-related risks and opportunities, considering policy and regulation, physical environment, technology, and other external factors for periodic evaluation. Internal discussions are held to assess risk and opportunity factors relevant to the Company. |
| (5) If scenario analysis is used to assess resilience to climate change risks, describe the scenarios, parameters, assumptions, analytical factors, and key financial impacts used. | The Company utilizes the "Taiwan Climate Change Projection Information and Adaptation Knowledge Platform" to analyze maximum temperature and rainfall under the RCP8.5 scenario, and uses the "NGFS Water Resource Sensitivity Analysis" to estimate water scarcity. These data support climate risk assessments across the Company's operational sites and supply chain vendors to mitigate asset loss. |
| (6) If there are transition plans to manage climate-related risks, describe the plan details, as well as the indicators and targets used to identify and manage physical and transition risks. | Current Climate Strategy Framework:
1. Enhancing Corporate Resilience: Low-carbon transition reduces energy costs and improves operational efficiency. By leveraging digital technology and sustainability strategies, the Company strengthens enterprise risk management, proactively develops sustainability plans, and establishes carbon and energy management systems to ensure compliance with future regulatory requirements.
2. Corporate Transformation: Developing carbon and energy management systems enables better public understanding of the financial significance of carbon management, enhances corporate image, and drives revenue growth. |
| (7) If internal carbon pricing is used as a planning tool, explain the basis for the price setting. | Internal Carbon Pricing not yet implemented |
| (8) If climate-related targets are set, describe the activities covered, greenhouse gas emission scopes, planning periods, and annual progress. If carbon offsets or renewable energy certificates (RECs) are used to achieve targets, specify the source and amount of offsets or RECs. | The Company has set a 1% annual reduction target of total GHG emissions based on the baseline year 2023. Solar power generation installation assessments are ongoing to increase the use of renewable energy. |
| (9) Greenhouse gas inventory and assurance status, reduction targets, strategies, and concrete action plans. | Please refer to sections 2 and 3 for detailed information. |

GHG Inventory and Assurance in the Past Two Years

	2025	2024
		Total Emissions (tCO2e)	Total Emissions (tCO2e)
The Company	Scope 1	143.4227	152.1096

	Scope 2	519.9431	519.3027
	Subtotal	663.3658	671.412
Subsidiary- BAYCOM	Scope 1	18.2010	19.0931
	Scope 2	271.1493	197.9617
	Subtotal	289.3503	217.055
Subsidiary -Tecom Wuhan	Scope 1	1.3026	0.7800
	Scope 2	10.9532	12.0100
	Subtotal	12.2558	12.7900
Total		964.9719	901.2573

Greenhouse Gas Assurance Information:

Please describe the assurance status for the most recent two years as of the publication date of this annual report, including the assurance scope, assurance provider, assurance standards, and assurance opinion.

In accordance with the Sustainability Development Roadmap for TWSE/TPEx Listed Companies issued by the Financial Supervisory Commission in March 2022, the Company is subject to greenhouse gas inventory requirements in the third implementation phase (i.e., completion of the inventory by 2026 and verification by 2028). Therefore, no assurance opinion is available for the 2025 greenhouse gas inventory.

Greenhouse Gas (GHG) Inventory, Assurance, and Reduction Strategy

The Company completed third-party verification of its organizational greenhouse gas (GHG) inventory for the year 2024 on April 23.

The planned GHG emission reduction measures include:

Replacement of outdated water pumps (In planning)
Employees are encouraged to turn off lights when not in use and set air conditioners at 26°C to reduce energy use. (Implemented)
A smart monitoring system has been set up to track and manage air conditioning electricity usage. (Implemented)
Deployment of a Carbon Management System. The system monitors and analyzes GHG emissions, identifies high-emission hotspots, and enables timely implementation of targeted emission reduction measures. (Implemented)

(7) Implementation of Ethical Corporate Management and differences and reasons for differences between The Company's Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
1. Establishment of the Policy and Plan for Business Integrity
(1) Has The Company established a policy for business integrity that has been approved by the board of directors and clearly stated the policy and practices of business integrity in its regulations and external documents, and has the board of directors and senior management actively implemented the policy commitments?	v		(1) The Company has established a Code of Integrity Operation and Ethical Behavior Guidelines, which have been disclosed on the Public Information Observation System. Integrity is our core value and fundamental to operating the business, and this standard applies to The Company's directors, executives, employees, and related parties.	(1) No significant difference
(2) Has The Company established a risk assessment mechanism for unethical behavior, regularly analyzed and assessed business activities with a higher risk of unethical behavior within its business scope, and formulated measures to prevent unethical behavior, at least covering the preventive measures of Article 7, Paragraph 2 of the "Integrity Operation Guidelines for Listed Companies"?	v		(2) The Company has established a "Risk Assessment Mechanism and Operational Management Procedures for Unethical Behavior," which includes preventive measures for the behaviors listed in Article 7, Paragraph 2 of the "Integrity Operation Guidelines for Listed Companies" The Human Resources Department is responsible for evaluating the appropriateness and effectiveness of the prevention plan and reporting to the Board of Directors.	(2) No significant difference
(3) Has The Company clearly defined operational procedures, behavior guidelines, penalties for violations, and complaint mechanisms in the plan to prevent unethical behavior, and implemented them, and periodically reviewed and revised the above plan?	v		(3) The Company's "Integrity Operation and Behavior Guidelines" prevent unethical behavior and establish internal and external reporting channels and processing systems. The above regulations have specified operational procedures, behavioral guidelines, violation and complaint systems, and are analyzed and evaluated regularly each year to develop preventive measures against unethical behavior, which are reported to the Board of Directors.	(3) No significant difference

-40-

Evaluation Item	Implementation Status
	Yes	No	Abstract Illustration
2. Implementation of Business Integrity
(1) Has The Company evaluated the integrity records of counterparties and stipulated integrity behavior clauses in contracts signed with them?

(2) Has The Company established a dedicated unit under the board of directors to promote corporate integrity, and regularly (at least once a year) reported to the board of directors on its policy for business integrity, measures to prevent unethical behavior, and supervision and implementation?

(3) Has The Company established a policy to prevent conflicts of interest, provided appropriate statement channels, and implemented them?

(4) Has The Company established effective accounting and internal control systems to implement business integrity, and based on the evaluation results of unethical behavior risks, formulated relevant audit plans for internal audit units to check compliance with measures to prevent unethical behavior, or entrusted accountants to conduct audits?
(5) Does The Company regularly hold internal and external education and training on business integrity? | v | | (1) The Company conducts business activities externally, and the Legal Department reviews the contract terms to avoid transactions with those who have a record of unethical behavior.

(2) The Company has designated personnel responsible for integrity management, and the Human Resources Department is responsible for formulating and supervising the implementation of The Company's integrity management policies and related measures. Reports are submitted to the Board of Directors annually, and no significant violations have been found to date.

(3) The Company expresses concern about conflicts of interest in its integrity operations, and clearly outlines the situations/standards of conflicts of interest in the Code of Conduct, requiring relevant personnel to recuse themselves. Additionally, it is required that when they become aware of or face similar situations, they proactively and fully report to their immediate supervisors or the Board of Directors.

(4) To ensure the implementation of integrity operations, The Company has established effective accounting and internal control systems, and internal audit personnel regularly check compliance with these systems.

(5) The Company reviews and revises relevant regulations for integrity operations and announces them for all employees to follow. Regular internal education and training on integrity management | (1) No significant difference

(2) No significant difference

(3) No significant difference

(4) No significant difference

(5) No significant difference |

-41-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
			are provided, and when new employees are trained, The Company's "Code of Conduct for Integrity Management" is communicated, and they are required to sign an "Employee Integrity Commitment."
3. Operation of the Whistleblowing System
(1) Has The Company established a specific whistleblowing and reward system, established convenient whistleblowing channels, and assigned appropriate receiving personnel for the subjects of whistleblowing?	v		(1) The Company places great emphasis on promoting ethical values and has established a " Code of Integrity Operation and Ethical Behavior Guidelines" to regulate our whistleblowing system. We encourage employees to report any suspected or discovered violations of laws or company regulations through our internal independent reporting mailbox ([email protected]), hotline (03-5775141#2600), or in writing, which will be handled by our audit department.	(1) No significant difference
(2) Has The Company established standard operating procedures for investigating reported matters, measures to be taken after completing investigations, and relevant confidentiality mechanisms?	v		(2) We have established a complaint handling procedure with clear operating procedures from filing a complaint to investigation and resolution. The Company maintains confidentiality of all individuals involved in the reporting process, and for employees who violate ethical behavior, they shall be dismissed in accordance with relevant laws or company management regulations. For agents, suppliers, customers, or other business partners found to have engaged in unethical behavior during business transactions with The Company, we shall immediately cease doing business with them and add them to our blacklist to uphold The Company's policy of ethical operation.	(2) No significant difference
(3) Does The Company take measures to protect whistleblowers from inappropriate treatment due to whistleblowing?	v		(3) To prevent unfair retaliation or treatment, The Company shall protect individuals involved in the	(3) No significant difference

-42-

Evaluation Item	Implementation Status			Deviations from “the Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies” and Reasons
	Yes	No	Abstract Illustration
			investigation process related to whistleblowing.
4. Strengthening Information Disclosure
Does The Company disclose the contents and effectiveness of its established policy for business integrity on its website and the Taiwan Stock Exchange and Gretai Securities Market information disclosure platform?	v		The Company has disclosed some information related to its integrity management on the Public Information Observation System. This includes the "Ethical Corporate Management." There is a dedicated person responsible for collecting and disclosing information, and a spokesperson system is in place.	No significant difference
5. If the company has adopted its own ethical corporate management best practice principles based on the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies, please describe any deviations between the principles and their implementation:
The Company has adopted the Ethical Corporate Management Best Practice Principles and continues to promote and implement such principles in accordance therewith, together with various awareness and communication initiatives to strengthen the understanding of management-level personnel. The content and related operations of the Company’s principles are not materially different from the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies.
6. Other important information that can help understand The Company's integrity operations (such as The Company's review and amendment of its established Ethical Corporate Management):
The Company adheres to The Company Act, Securities Exchange Law, relevant regulations for listed companies, and all applicable laws as the foundation for implementing integrity in our business operations. We prohibit any business dealings with parties involved in dishonest practices.

(8) Other important information that can enhance understanding of The. Company's corporate governance practices may also be disclosed:

The Company continues to invest resources to enhance corporate governance practices. A dedicated “Corporate Governance” section has been established on the Company’s website to provide information on the Company’s governance practices, along with access to relevant governance regulations for download. In addition, the Company discloses material information in a timely manner and holds investor conferences on a regular basis. Please refer to the Company’s website or the Market Observation Post System (MOPS) for more information.

Directors' Continuing Education Status:

Title	Name	Date of Education	Organizer	Course Title	Number of Hours
Chairman	Representative of TECO Electric & Machinery Co., Ltd: Wu, Su-Chiu	2025.07.31	Taiwan Stock Exchange	2025 Summit on Strengthening Taiwan's Capital Market	3
		2025.08.13	Chinese Independent Directors Association	Challenges and Responses to the New Global Economic and Trade Landscape	3
Director	Representative of TECO Electric & Machinery Co., Ltd: Liu, An-Bing	2025.08.13	Chinese Independent Directors Association	Challenges and Responses to the New Global Economic and Trade Landscape	3
		2025.12.16	Taiwan Academy of Corporate Directors	Manufacturing Transformation in the AI Era and Directors' Governance Responsibilities	3
Director	Representative of TECO Electric & Machinery Co., Ltd: Tien, Ying-Juei	2025.08.13	Chinese Independent Directors Association	Challenges and Responses to the New Global Economic and Trade Landscape	3
		2025.12.16	Taiwan Academy of Corporate Directors	Manufacturing Transformation in the AI Era and Directors' Governance Responsibilities	3
Director	Representative of TECO Electric & Machinery Co., Ltd: Lin, Jia-Sheng	2025.08.13	Chinese Independent Directors Association	Challenges and Responses to the New Global Economic and Trade Landscape	3
Director	Liu, Chao-Kai	2025.08.13	Chinese Independent Directors Association	Challenges and Responses to the New Global Economic and Trade Landscape	3
		2025.12.16	Taiwan Academy of Corporate Directors	Manufacturing Transformation in the AI Era and Directors' Governance Responsibilities	3
Director	Yang, Shih-Chien	2025.10.30	Chinese Corporate Governance Association	Group Governance and Performance Management	3
		2025.10.30	Chinese Corporate Governance Association	Professional Training Course on Dual Transformation of Sustainability and Digitalization	3
Independent Director	Chen, Shui Lien	2025.07.25	Securities and Futures Institute	2025 Legal Compliance Seminar on Insider Equity Transactions	3
		2025.10.03	Securities and Futures Institute	2025 Seminar on Insider Trading Prevention	3

-45-

Title	Name	Date of Education	Organizer	Course Title	Number of Hours
Independent Director	Lin, Chiang-Liang	2025.11.03	Taiwan Corporate Governance Association	Key Analysis of Presentation and Disclosure Requirements under IFRS 18 Financial Statements	3
		2025.11.03	Taiwan Corporate Governance Association	Analysis of Fraud Crime Patterns and Related Legal Liability Cases	3
Independent Director	Lee, Feng Ao	2025.05.06	Securities and Futures Institute	Carbon Credit Trading Mechanisms and Applications in Carbon Management	3
		2025.12.16	Taiwan Academy of Corporate Directors	Manufacturing Transformation in the AI Era and Directors’ Governance Responsibilities	3

Managers' Education Status:

Title	Name	Date of Education	Organizer	Course Title	Number of Hours
Associates (Chief Accountant)	Wang, Yen-Lee	09.08.2025~09.09.2025	Accounting Research and Development Foundation	Continuing Education for Chief Accounting Officers of Issuers, Securities Firms, and Stock Exchanges	12
Director (Supervisor of Finance and Accounting)	Li, Mei-Ling	09.08.2025~09.09.2025	Accounting Research and Development Foundation	Continuing Education for Chief Accounting Officers of Issuers, Securities Firms, and Stock Exchanges	12
Audit Supervisor	Chu, Ruey-Chei	10.23.2025	The Institute of Internal Auditors-Chinese Taiwan	Interpretation of Financial Analysis Indicators and Prevention of Operational Risks	6
		11.19.2025	The Institute of Internal Auditors-Chinese Taiwan	Regulations and Practical Analysis of Loans of Funds, Endorsements and Guarantees, and Acquisition or Disposal of Assets	6

Corporate Governance Officer Functions:

(1) Conducting meetings related to the Board of Directors and Shareholders' Meetings in accordance with the law.
(2) Preparation of minutes for Board of Directors and Shareholders' Meetings.
(3) Assisting directors and independent directors in their appointments, continuous education, and execution of business-required tasks.
(4) Assisting directors and independent directors in compliance with laws and regulations.
(5) Other matters stipulated by the company's articles of association or contracts, etc.

Governance Officer Education Status:

Title	Name	Date of Education	Organizer	Course Title	Number of Hours
Corporate Governance Officer	Tung, Hsien-Kang	06.03.2025	The Institute of Internal Auditors-Chinese Taiwan	How Internal Auditors Interpret Operating Performance and Risks from IFRS Financial Statements	6
		12.16.2025	The Institute of Internal Auditors-Chinese Taiwan	Intelligent Auditing Era: AI Systems Auditing and AI-Assisted Auditing	6

(9) Execution Status of Internal Control System

Internal Control Statement

Please refer to the Market Observation Post System (MOPS) [website: https://mops.twse.com.tw > Company > Corporate Governance > Company Rules > Internal Control/Internal Control Statement Disclosure]. Enter the year and company code to search for the Internal Control Statement disclosure.

Disclosure of the auditor's review report: In the event that the internal control system is not applicable, the auditor appointed to review the internal control system shall disclose the review report.

(10) For the current fiscal year and up until the date of publication of the annual report, if The Company and its insiders have been legally punished, or if The Company has imposed penalties on its insiders for violating internal control system regulations, and if the penalty results may have a significant impact on shareholder equity or securities prices, the content of the penalty, m

(11) ajor deficiencies, and improvement status shall be disclosed: None

(12) Important resolutions of the shareholders' meeting and the board of directors for the current fiscal year and up until the date of publication of the annual report shall be disclosed.

Important resolutions of the shareholders' meeting and the board of directors for the current fiscal year and up until the date of publication of the annual report shall be disclosed.

03.05.2025	Important Board Resolutions: • Approved the Company’s 2024 Business Report and Financial Statements. • Approved the Company’s 2024 loss appropriation proposal. • Approved the appointment of the certifying CPA for 2025, remuneration, and evaluation of independence and competence. • Approved the evaluation of the effectiveness of the Company’s 2024 internal control system and the Internal Control System Statement (declaring the internal control system effective). • Approved the amendment to Article 23 of the Company’s Articles of Incorporation. • Approved the convening of the Company’s 2025 Annual General Shareholders’ Meeting. • Approved the total short-term borrowing credit line from financial institutions for 2025. • Approved the renewal of the Company’s bank credit facilities. • Approved new bank credit facilities.
05.13.2025	Important Board Resolutions: • Approved the Company’s Q1 2025 consolidated financial statements. • Approved amendments to the Sustainability Information Management Procedures. • Approved the Company’s IFRS Sustainability Disclosure Standards implementation plan. • Approved the proposed adoption of the Procedures for Preparation and Filing of Sustainability Reports. • Approved proposed amendments to the Detailed Rules for Internal Audit Implementation of Sustainability Information Management Procedures. ※The timetable planning report for greenhouse gas inventory and verification was presented to the Board.
06.19.2025	Major Resolutions of the Annual General Shareholders’ Meeting: 1. Approved the Company’s 2024 Business Report and Financial Statements. 2. Approved the Company’s 2024 loss appropriation proposal. 3. Approved amendments to the Company’s Articles of Incorporation.
07.02.2025	Important Board Resolutions: • Approved the establishment of the Smart Electromechanical Strategic Transformation Committee. • Approved the election of the new Chairperson.
08.06.2025	Important Board Resolutions: • Approved the Company’s Q2 2025 consolidated financial statements. • Approved matters recommended by the 3rd meeting of the 6th Remuneration Committee. • Approved adjustments to the Company’s organizational structure.

Approved the Company’s 2024 Sustainability Report.
Approved the renewal of the Company’s bank credit facilities.
Approved newly granted bank credit facilities.
※The timetable planning report for greenhouse gas inventory and verification was presented to the Board.

09.15.2025

Important Board Resolutions: - Approved matters recommended by the 4th meeting of the 6th Remuneration Committee. - Approved two proposals submitted by the Strategic Transformation Committee in response to the transformation of the Company’s smart electromechanical business.

10.31.2025

Important Board Resolutions: - Approved the Company’s Q3 2025 consolidated financial statements. - Approved the conversion of privately placed Class A preferred shares into privately placed common shares. - Approved the Company’s 2026 internal audit plan. - Approved the renewal of the Company’s bank credit facilities. - Approved the disposal of equity interests in three affiliated companies. - Approved adjustments to the Company’s organizational structure. ※The timetable planning report for greenhouse gas inventory and verification was presented to the Board.

12.17.2025

Important Board Resolutions: - Approved the change of the Company’s Chief Accounting Officer and spokesperson. - Approved the compensation proposal for the newly appointed Chief Accounting Officer. - Approved the regular evaluation of the reasonableness of compensation for the Company’s managerial officers. - Approved the Company’s 2026 operating budget. - Approved amendments to the Rules for Distribution of Employee Compensation. - Approved amendments to the Detailed Rules for Internal Audit Implementation. - Approved the abolition of the Mobile Communications Branch. - Approved newly granted bank credit facilities.

Execution Status of the 2025 Annual Shareholders' Meeting (June 19, 2025):

No.	Resolution Item	Implementation Status
1	Approval of recognizing the company's 2024 operating report and financial statements.	The approval rate accounted for 99.92% of the total voting rights, and the resolution was passed as proposed.
2	Approval of recognizing the appropriation of losses for 2024.	The approval rate accounted for 99.92% of the total voting rights, and the resolution was passed as proposed.
3	Approved the amendment to the Company’s Articles of Incorporation.	The approval rate accounted for 99.92% of the total voting rights, and the resolution was passed as proposed.

(13) For the latest fiscal year and up to the date of publication of the annual report, there have been instances where directors expressed dissenting opinions regarding significant resolutions passed by the board of directors. These dissenting opinions were documented or presented in written statements, and their main contents are as follows: None

Accountant Fees
Unit: in thousand NT$

Accounting firm	CPA name	Audit period	Audit fee	Non-audit fee	Total	Note
PwC Taiwan	Jiang, Cheng Han	Full year 2025	3,200	125	3,325
	Liu, Chien-Yu

Note: Non-audit fees of NT$125 thousand dollars include professional services such as tax and business consultation.

(1) When non-audit fees paid to the auditor, the auditor's affiliated firm, and its related enterprises account for more than 25% of the audit fees, the amounts and nature of both audit and non-audit fees shall be disclosed: No such circumstance.

(2) If audit fees paid for the current year after changing the auditor and the audit fees are reduced by more than that of the previous year, the amounts and reasons for the changes in audit fees before and after the change shall be disclosed: No such circumstance.

(3) If the audit fees decrease by 10% or more compared to the previous year, the amount, percentage, and reasons for the decrease in audit fees shall be disclosed: No such Circumstances

-50-

5. Change of Accountants

(1) Regarding the former accountant.

Date of Change	07.15.2024
Reasons for change and explanation	Compliance with the internal rotation policy of KPMG Taiwan Joint Accounting Firm
Explanation of termination or non-acceptance of appointment by the appointee or accountant	Party Situation		Accountant	Appointer
	Voluntary termination of appointment		Not applicable	Not applicable
	No longer accepting (continuing) appointment		Not applicable	Not applicable
Audit opinions and reasons other than unqualified opinions issued in the past two years	None
Whether there are any disagreements with the issuer	Yes		Accounting principles or practices
			Disclosure of financial statements
			Scope or procedures of audit
			Others
	No	v
	Explanation
Other disclosure matters (Items 4 to 7 of the first item of paragraph 6 of Article 10 of this standard shall be disclosed)	None

(2) Regarding the successor accountant:

Accounting firm	PricewaterhouseCoopers Taiwan
CPA name	Jiang, Cheng Han, Liu, Chien-Yu
Date of appointment	07.15.2024
Consultation and results on specific transaction accounting treatment or accounting principles and potential opinions to be issued on financial reports	Not Applicable
Written opinions from the successor auditor on matters where they disagree with the predecessor auditor	Not Applicable

(3) Letter of response from the former accountant regarding three matters listed in Article 10, Paragraph 6, Subparagraphs 1 and 2 of this standard: None

The Employment of The Company's Chairman, General Manager, Financial or Accounting Manager with the Firm of the Auditing CPA or Its Affiliated Businesses in the Past Year: None

Particulars about Changes in Shareholding and Equity Pledge of Directors, Supervisors, Managers and Shareholders Holding More Than 10% of The Company's Shares in the Past Year and as of the Date of Publication of the Annual Report

(1) Information on changes in shareholding of directors, managerial personnel, and major shareholders.

Title	Name	Year 2024		As of April 18 of the current fiscal year
		Shareholding Increase/(Decrease)	Pledged share Increase/(Decrease)	Shareholding Increase/(Decrease)	Pledged share Increase/(Decrease)
Chairman	TECO Electric & Machinery Co., Ltd	0	0	0	0
	Representative: Wu, Su-Chiu (Note 1)	0	0	0	0
Director	TECO Electric & Machinery Co., Ltd	0	0	0	0
	Representative: Liu, An-Bing	0	0	0	0
Director	TECO Electric & Machinery Co., Ltd	0	0	0	0
	Representative: Lin, Jia-Sheng (Note 2)	0	0	0	0
Director	TECO Electric & Machinery Co., Ltd	0	0	0	0
	Representative: Tien, Ying-Juei	0	0	0	0
Director Representative	Peng, Chi-Tseng (Note 3)	0	0	Not Applicable	Not Applicable
Director Representative	Sun, Chien-Jung (Note 4)	0	0	Not Applicable	Not Applicable
Director	Liu, Chao-Kai	0	0	0	0
Director	Yang, Shih-Chien	0	0	0	0
Independent Director	Chen, Shui Lien	0	0	0	0
Independent Director	Lin, Chiang-liang	0	0	0	0
Independent Director	Lee, Feng Ao	0	0	0	0
General Manager	Tien, Ying-Juei	0	0	0	0
Deputy General Manager	Sun, Hsu-Hsin	0	0	0	0
Major shareholder	TECO Electric & Machinery Co., Ltd	0	0	0	0
Head of Finance Department	Sun, Mau-Luen (Note 5)	0	0	Not Applicable	Not Applicable
Head of Finance Department	Li, Mei-Ling (Note 6)	0	0	0	0
Head of Accounting Department	Wang, Yen-Li (Note 7)	0	0	Not Applicable	Not Applicable
Head of Accounting Department	Li, Mei-Ling (Note 6,8)	0	0	0	0
Corporate Governance Officer	Tung, Hsien -Kang	0	0	0	0

Note 1: Corporate Director Ms. Wu Su-Chiu assumed office on February 16, 2025.
Note 2: Corporate Director Mr. Lin Jia-Sheng assumed office on August 4, 2025.
Note 3: Corporate Director Mr. Peng Chi-Tseng was dismissed on August 4, 2025.
Note 4: Corporate Director Mr. Sun Chien-Jung was dismissed on February 16, 2025.
Note 5: Chief Financial Officer Mr. Sun Mao-Luen was dismissed on December 15, 2025.
Note 6: Chief Accounting Officer Ms. Li Mei-Ling assumed office on December 15, 2025.
Note 7: Chief Accounting Officer Ms. Wang Yen-Li was dismissed on December 17, 2025.
Note 8: Chief Accounting Officer Ms. Li Mei-Ling assumed office on December 17, 2025.

(2) Related parties involved in the share trading information: None
(3) Related parties involved in the share pledge information: None

Information About the Top 10 Shareholders who are Interested parties or relatives within the second degree of kinship, including spouses
March 08, 2026 (Based on the shareholder registry)

Name	Shareholding		Shareholding of spouse and minor children		Total shareholding by nominee arrangements		Specify the name of the entity or person and their relationship to any of the other top 10 shareholders with which the person is a related party or has a relationship of spouse or relative within the 2nd degree
	Shares	%	Shares	%	Shares	%	Name of entity or individual	Relationship
TECO Electric & Machinery Co., Ltd	19,228,898	63.52%	0	0%	0	0%	None	None
Liu, Chao-Kai	1,177,340	3.89%	109,440	0.36%	0	0%	Shen, Bau-Dau	Spouse
Ku, Shih-Yang	745,091	2.46%	0	0%	0	0%	None	None
BAYCOM OPTO-ELECTRONICS TECHNOLOGY CO.,LTD.	317,689	1.05%	0	0%	0	0%	None	None
Liu, Wen-Feng	199,296	0.66%	0	0%	0	0%	None	None
Huang, Yi	188,000	0.62%	0	0%	0	0%	None	None
Chen, You-Ren	149,000	0.49%	0	0%	0	0%	None	None
VOYAGE INVESTMENT LIMITED	151,000	0.50%	0	0%	0	0%	None	None
Huang, Chao-He	130,000	0.43%	0	0%	0	0%	None	None
Huang, Yuan-Mu	115,000	0.38%	0	0%	0	0%	None	None
Lin, Wen-Lin	111,000	0.37%	0	0%	0	0%	None	None
Shen, Bau-Dau	109,440	0.36%	1,177,340	3.89%	0	0%	Liu, Chao-Kai	Spouse
Zhong, Gui-Ming	91,440	0.30%	0	0%	0	0%	None	None

The Company, its directors, executives, and businesses directly or indirectly controlled by The Company, holding shares in the same investee company, and combining to calculate the comprehensive shareholding ratio.

December 31,2025 Unit: shares; %

Re-invested businesses	The Company's investment		Directors, Managers, and directly or indirectly controlled investment		Total investment
	Shareholding	Shareholding %	Shareholding	Shareholding %	Shareholding	Shareholding %
BAYCOM OPTO-ELECTRONICS TECHNOLOGY CO., LTD.	14,700,741	43.76	0	0	14,700,741	43.76
A-TEL INC.	596,925	28.19	0	0	596,925	28.19
Taian Technology Sdn. Bhd.	1,100,000	10.00	0	0	1,100,000	10.00
E-JOY ELECTRONICS INTERNATIONAL CO., LTD.	641,129	4.90	0	0	641,129	4.90
TECNOS INTERNATIONAL CONSULTANT CO., LTD	752,592	5.26	0	0	752,592	5.26
TECO TOUR TRAVEL SERVICE CO., LTD.	480,000	16.00	0	0	480,000	16.00

Note: It refers to long-term investments accounted for using the equity method by The Company.

III. Fundraising Status

Capital and Shares

Source of Share Capital

Specify the types of shares issued by The Company in the most recent fiscal year and up to the date of publication of the annual report.

April 21, 2025 Unit: NT$ per share

Year/Month	Par Value (NT$)	Approved Capital		Paid-in Capital		Note
		Shareholding	Amount	Shareholding	Amount	Source of Share Capital	Capital Increased by Assets Other than Cash	Others
09/1980	10	1,500,000	15,000,000	1,500,000	15,000,000	Establishment		Yuantou No. 769
05/1981	10	3,000,000	30,000,000	3,000,000	30,000,000	Capital increase 15,000,000		Yuanji No. 0619
11/1981	10	3,720,000	37,200,000	3,720,000	37,200,000	Capital increase 7,200,000		Yuanji No. 1794
02/1982	10	3,870,000	38,700,000	3,870,000	38,700,000		Technical Analysis 1,500,000	Yuanji No. 0302
08/1986	10	5,000,000	50,000,000	5,000,000	50,000,000	Capitalization of Retained Earnings10,449,000 Capital increase 851,000		Yuanjing No. 8943
02/1988	10	9,000,000	90,000,000	9,000,000	90,000,000	Capitalization of Retained Earnings40,000,000		Yuanjing No. 02008
12/1988	10	19,000,000	190,000,000	19,000,000	190,000,000	Capital increase 10,000,000 Capitalization of Retained Earnings90,000,000		Yuanjing No. 16064
12/1989	65	27,000,000	270,000,000	27,000,000	270,000,000	Capital increase 80,000,000		Yuanjing No. 14898
12/1990	10	40,500,000	405,000,000	40,500,000	405,000,000	Capitalization of Retained Earnings54,000,000 Capitalization of Capital Reserve81,000,000		Yuanjing No. 13227
08/1991	10	64,800,000	648,000,000	64,800,000	648,000,000	Capitalization of Retained Earnings121,500,000 Capitalization of Capital Reserve 121,500,000		Yuanjing No. 10202
08/1992	10	84,240,000	842,400,000	84,240,000	842,400,000	Capitalization of Retained Earnings129,600,000 Capitalization of Capital Reserve 64,800,000		Yuanjing No. 10817
11/1993	25	101,088,000	1,010,880,000	101,088,000	1,010,880,000	Capital increase 84,240,000 Capitalization of Retained Earnings42,120,000 Capitalization of Capital Reserve42,120,000		Yuanjing No. 15400
	10
09/1994	10	106,142,400	1,061,424,000	106,142,400	1,061,424,000	Capitalization of Capital Reserve 50,544,000		Yuanjing No. 12111
08/1995	10	118,879,488	1,188,794,880	118,879,488	1,188,794,880	Capitalization of Retained Earnings63,685,440 Capitalization of Capital Reserve 63,685,440		Yuanshang No. 12085
08/1996	10	170,000,000	1,700,000,000	135,522,618	1,355,226,180	Capitalization of Retained Earnings83,215,650 Capitalization of Capital Reserve 83,215,650		Yuanshang No. 13563
12/1997	10	170,000,000	1,700,000,000	142,478,899	1,424,788,990	Capitalization of Retained Earnings69,562,810		Yuanshang No. 25251
09/1998	10	200,000,000	2,000,000,000	158,150,989	1,581,509,890	Capitalization of Retained Earnings128,225,120 Capitalization of Capital Reserve 28,495,780		Yuanshang No. 022804
07/1999	10	250,000,000	2,500,000,000	182,003,948	1,820,039,480	Capitalization of Retained Earnings208,480,903 Capitalization of Capital Reserve 30,048,687		Yuanshang No. 016453
11/1999	-	250,000,000	2,500,000,000	189,894,952	1,898,949,520	Corporate Bond Conversion78,910,040		Yuanshang No. 024636
01/2000	-	250,000,000	2,500,000,000	198,699,293	1,986,992,930	Corporate Bond Conversion 88,043,410		Yuanshang No. 000292
03/2000	-	250,000,000	2,500,000,000	200,095,319	2,000,953,190	Corporate Bond Conversion 13,960,260		Yuanshang No. 004823
07/2000	10	420,000,000	4,200,000,000	245,882,673	2,458,826,730	Capitalization of Retained Earnings318,897,890 Capitalization of Capital Reserve 120,057,200 Corporate Bond Conversion 18,918,450		Yuanshang No. 016214
	-
11/2000	-	420,000,000	4,200,000,000	245,888,715	2,458,887,150	Corporate Bond Conversion 60,420		Yuanshang No. 026962
09/2001	10	420,000,000	4,200,000,000	276,978,790	2,769,787,900	Capitalization of Retained Earnings175,621,010 Capitalization of Capital Reserve 135,238,800 Corporate Bond Conversion 40,940		Yuanshang No. 022526
09/2002	10	420,000,000	4,200,000,000	290,827,730	2,908,277,300	Capitalization of Capital Reserv138,489,400		Yuanshang No. 0910019937
09/2003	10	420,000,000	4,200,000,000	297,331,831	2,973,318,310	Capitalization of Retained Earnings107,931,010 Cancellation of Treasury Stock 42,890,000		Yuanshang No. 0920023311
	-
11/2012	1.5	945,000,000	9,450,000,000	630,665,181	6,306,651,810	Private Placement Convertible Preferred Shares		Yuanshang No. 1010036570
09/2018	10	945,000,000	9,450,000,000	315,332,590	3,153,325,900	Reduction of 315,332,591 Shares		Zhushang No. 1070026706
08/2020	10	945,000,000	9,450,000,000	94,599,777	945,997,770	Reduction of 220,732,81 Shares		Zhushang No. 1090023878
12/2022	10	945,000,000	9,450,000,000	30,271,929	302,719,290	Reduction of 64,327,848 Shares		Zhushang No. 1110040531

-55-

Class of shares	Approved Capital
	Shares in circulation	Unissued shares	Total
Registered common shares (listed)	14,271,928	914,728,071	945,000,000
Privately Placed Common Shares	16,000,001

For issuers who have been approved to raise funds through the comprehensive declaration system for the issuance of securities, information on the approved amount, planned issuance, and issued securities should also be disclosed: Not applicable.

(2) Major Shareholders

March 28, 2026 (As recorded in the shareholder registry.)

| Shares
Major Shareholders | Shareholding | Shareholding% |
| --- | --- | --- |
| TECO Electric & Machinery Co., Ltd | 19,228,898 | 63.52% |
| Liu, Chao-Kai | 1,177,340 | 3.89% |
| Ku, Shih-Yang | 652,000 | 2.15% |
| BAYCOM OPTO-ELECTRONICS
TECHNOLOGY CO., LTD. | 317,689 | 1.05% |
| Liu, Wen-Feng | 199,296 | 0.66% |
| Chen, You-Ren | 166,000 | 0.55% |
| VOYAGE INVESTMENT LIMITED | 151,000 | 0.50% |
| Huang, Chao-He | 130,000 | 0.43% |
| Shen, Bau-Dau | 109,440 | 0.36% |
| Zhong Gui-Ming | 91,440 | 0.30% |

(3) Dividend Policy and Implementation Status of The Company

Dividend Policy stipulated in the Articles of Incorporation

(A) The dividend policy stipulated in The Company's articles of incorporation is as follows: According to the profitability of the current fiscal year, The Company should allocate 1% to 10% of profits to distribute employee remuneration; No less than 10% of the employee compensation under this item shall be allocated to grassroots employees, and the remuneration for directors and supervisors should not exceed 5%. The recipients of employee remuneration may include employees of subsidiary companies who meet certain conditions. However, when The Company still has accumulated losses, these losses should be offset.

The ratio of employee remuneration and remuneration for directors and supervisors, and the decision to distribute employee remuneration in the form of stocks or cash, must be approved by a resolution of the board of directors with the attendance of more than two-thirds of the directors and the consent of the majority of the attending directors, and must be reported to the shareholders' meeting.

The profitability of the current fiscal year referred to in the preceding paragraph means the pre-tax income of the current fiscal year minus the income before distributing employee remuneration and remuneration for directors and supervisors.

(B) If The Company has profits in the annual closing of accounts, they will be allocated in the following order:

(1) Payment of taxes.
(2) Offset accumulated losses.
(3) Set aside 10% as legal reserve. However, when the legal reserve has reached the total amount of capital, this limit no longer applies.
(4) Provision or reversal of special reserve in accordance with relevant laws and regulations.
(5) Payment of special stock dividends.
(6) The remaining balance is added to undistributed earnings from previous fiscal years and distributed as dividends to shareholders. The Board of Directors will prepare a proposed profit distribution plan. If the profit distribution plan includes cash dividends, the Board of Directors is authorized to distribute them through a special resolution and report to the shareholders' meeting.

The dividend distribution policy of the company takes into account factors such as the current and future investment environment, funding needs, domestic and international competitive conditions, and capital budgeting, while considering the interests of shareholders, balancing dividends, and long-term financial planning as principles. The proportion of cash dividends in the aforementioned shareholder dividends for each fiscal year shall generally not exceed 50%, but shall not be less than 5%.

When the company has no losses, it may distribute all or part of the legal reserve surplus and capital surplus in accordance with the provisions of the Company Law as new shares or cash. When distributing the legal reserve surplus as new shares or cash, it shall be limited to the portion exceeding 25% of the paid-in capital.

If the company, in accordance with the provisions mentioned above, distributes all or part of the legal reserve surplus and capital surplus in accordance with the Company Law as cash, the Board of Directors is authorized to distribute them through a special resolution and report it at the most recent shareholders' meeting.

The proposed dividend distribution situation for this shareholders' meeting: Not applicable.

(4) Impact of proposed free stock dividends on The Company's operating performance and earnings per share: Not applicable.

(5) Employees and Directors' Remuneration

Percentage or range of employees' and directors' remuneration as stated in The Company's articles of incorporation: Please refer to page 56 (3) of this annual report, Section 6 - Company's Dividend Policy and Implementation Status.
Basis for estimating the amount of employee and director remuneration in the current period, calculation basis for employee remuneration distributed in stocks, and accounting treatment for any differences between the estimated amount and the actual amount of remuneration distributed: The Company did not estimate employee and director remuneration in the 2025 fiscal year, as no profit was distributed.
Decisions made by the board of directors regarding the distribution of remuneration:

(1) The amount of employee and director remuneration distributed in cash or stocks: None.
(2) The proportion of employee remuneration distributed in stocks and the total amount of employee remuneration compared to The Company's after-tax net income for the period and the total amount of employee remuneration: Not applicable.

Actual distribution of employee and director remuneration in the previous fiscal year (including the number of shares distributed, the amount, and the stock price), any differences between the actual distribution and the recognition of employee and director remuneration, and an explanation of the differences, reasons, and treatment: Not applicable, as The Company did not distribute any profits in the previous fiscal year.

(6) Share Buyback Status: None.

-56-

-57-

2. Corporate Bonds

(1) Corporate Bonds

Type of Corporate Bonds		The 1st tranche of year 2021 unsecured corporate bonds issued through private placement
Issuing date		November 17, 2021
Face value		1 million NT$
Place of issue and trading		Domestic
Issue price		Issued at par value
Issue amount		133 million NT$
Coupon rate		Annual interest rate 2.00%
Term		Maturity: Five-year
Maturity date: November 17, 2026
Guarantor		None
Trustee		None
Underwriter		None
Attesting lawyer		None
Attesting CPA		None
Redemption Method		The principal will be fully repaid once upon maturity five years from the issuance date.
Unredeemed balance		133 million NT$
Conditions for redemption or early redemption		Starting from the issuance date of The Company's bonds, after three years, The Company may at any time buy back the bonds early at face value per bond, and the bondholders shall not object.
Restrictive covenants		None
Name of rating agency, date and result of rating		None
Other rights	The monetary amount of common shares, global depositary receipts, or other securities already converted, exchanged, or subscribed up to the annual report publication date	None
	The issuance and conversion, exchange, or subscription rules	Please refer to page 58 of this annual report.
The possible dilution of shareholding and influence on shareholder equity caused by the issuance and conversion, exchange, or subscription rules and the terms of issuance.
Name of the custodian institution of the exchangeable underlyings

(2) Corporate Bond Issuance Procedures

Tecom Co., Ltd.
Domestic Unsecured Corporate Bond Issuance Method for 2021

Board of Director’s Resolution Date: November 11, 2021

Bond Name: Tecom Co., Ltd. (hereinafter referred to as "The Company") issued unsecured corporate bonds (hereinafter referred to as the "Corporate Bonds") in 2021.
Total Issuance: The total issuance of The Company Bonds is NTD 133 million.
Face Value: The face value of each Company Bond is NTD 1 million.
Par Value: The Company Bonds will be issued at 100% of their face value.
Issuance Period: The issuance period of The Company Bonds is five years, from November 17, 2021 to November 17, 2026.
Coupon Rate: The coupon rate of The Company Bonds is a fixed annual rate of 2%.
Repayment: The Company Bonds will be repaid once at maturity.
Call Option: The Company may exercise a call option to repurchase The Company Bonds at any time after three years from the issue date, at the face value of each bond plus accrued interest. The bondholders shall not object to the repurchase. The Company will notify the bondholders in writing or by other means ten days prior to the forced repurchase.
Interest Payment: The Company Bonds will pay interest annually based on the face value and the coupon rate, with a single interest payment per year. Interest will be rounded to the nearest cent for each NTD 1 million bond. If the repayment and interest payment date falls on a bank holiday, the payment will be made on the next business day without additional interest.
Bond Form: The Company Bonds will be issued in a paperless form and registered with Taiwan Depository & Clearing Corporation.
Paying Agent: The Company has entrusted the East District Branch of Hua Nan Commercial Bank to act as the paying agent for bond principal and interest payments.
Notification Method: Matters related to notifying bondholders in accordance with legal requirements shall be handled accordingly.

-58-

3. Preferred Shares

(1) Preferred Shares

| Item Issuing date | | | November 1, 2012
(Privately placed convertible preferred shares type A) |
| --- | --- | --- | --- |
| Par value | | | 10 |
| Issue Price | | | 1.5 |
| Number of shares (Note 1) | | | 16,000,001 |
| Total amount (Note 2) | | | 24,000,001 |
| Rights and obligations | Distributions of dividends and bonuses | Annual interest rate of 3%, calculated based on the issue price. | |
| | | Distribution of residual property | Same as Common Shares |
| | | Exercise of voting rights | With voting rights |
| | | Others | None |
| Issued and outstanding preferred shares (Note3) | Number of shares redeemed or converted | 16,000,001 | |
| | | Balance of shares not redeemed or converted | 0 |
| | | Terms and conditions for redemption or conversion | Please refer to page 60-61 of this annual report. |
| Market price per share | | | Not Applicable |
| Other rights | Amount converted or subscribed as of the annual report publication date | | 160,000,010 |
| | Issuance and conversion or subscription rules | | Please refer to page 60-61 of this annual report. |
| The possible effect of the terms of issuance on the shareholders equity of holders of preferred shares, possible dilution of shareholding, and effect on the equity of current shareholders. | | | Before the conversion of preferred stock to common stock, earnings must be distributed to preferred stockholders first before common stock dividends can be distributed. If the preferred stock is converted to common stock, the earnings per share of common stock shareholders will be diluted, and the degree of dilution will depend on the number of shares converted. |

Note 1: Number of shares after capital reduction in November 2022.
Note 2: Total amount after capital reduction in November 2022.
Note 3: The holders of the Company's privately placed Class A convertible preferred shares requested conversion. into a total of 16,000,001 common shares. On October 31, 2025, the Board of Directors resolved to set November 20, 2025 as the record date for the issuance of new common shares in connection with the share conversion, and the related registration amendment was completed on December 3, 2025.

(2) Issuance and conversion methods for preferred shares

Tecom Co., Ltd.

First private placement issuance in 2012.

Issuance and conversion methods of convertible preferred shares of Type A

Name of the Preferred Shares

Tecom Co., Ltd. (hereinafter referred to as "The Company") issued convertible preferred shares of Type A (hereinafter referred to as the "Preferred Shares").

Purpose of the Issuance

To improve the financial structure and enhance operational capital in response to future changes in economic conditions, business growth requirements, and to increase The Company's competitiveness.

Method of Issuance

Issuance by private placement in accordance with Article 43-6~8 of the Securities Exchange Law.

Total Issuance

The total issuance is 333,333,350 shares, with a par value of NTD 10 per share, for a total (par value) of NTD 3,333,333,500. The total amount actually received is NTD 500,000,025.

Issue Price

The issue price per share is NTD 1.5.

Issue Date

The Preferred Shares were issued on November 1, 2012 (hereafter referred to as the "Issue Date").

Issuance Period The issuance period is five years, from the Issue Date of November 1, 2012, to the maturity date of October 31, 2017 (hereafter referred to as the "Maturity Date")
Dividends

(1) The dividend rate of the Preferred Shares is set at an annual interest rate of 3%, calculated based on the issue price.

(2) The dividends of the Preferred Shares cannot be accumulated.

(3) In the event of The Company's annual accounting profit after paying all taxes and fees in accordance with the law and accounting standards, and making up for previous year losses and setting aside for legal reserve, The Company shall prioritize the distribution of the current year's dividends to the holders of Preferred Shares before distributing dividends to the common shareholders.

(4) In the year when the dividend of the Preferred Shares is received, if the dividend for the common shares exceeds 3% of the face value, the holders of the Preferred Shares may participate in the distribution of the excess portion by converting one share of the Preferred Shares into a proportionate number of common shares, but they may not participate in the distribution of profits or capital reserve for the common shares before conversion.

(5) The dividends of the Preferred Shares will be paid in cash once a year, and the record date will be determined by the Board of Directors of The Company after the financial statements have been approved at the annual shareholders' meeting. The dividends of each year will be calculated based on the actual number of days in the year of issuance.

(6) Holders of Preferred Shares who convert to common shares before the ex-dividend date are not eligible to participate in the distribution of dividends of the current year for the Preferred Shares, but may participate in the distribution of profits or capital reserve for common shares.

Conversion Target

The new common shares issued by The Company.

Conversion Period

The holders of the Preferred Shares may request The Company to convert their Series A Preferred Shares into common shares based on the conversion ratio after two years from the date of the Preferred Shares issuance, except during the period when the transfer of shares is suspended or when conversion rights cannot be exercised under applicable laws and regulations. The rights and obligations of the converted common shares shall be the same as those of the common shareholders, except as otherwise provided by law.

Conversion Ratio

Holders of Preferred Shares, except during the period when the transfer of shares is suspended, may convert their shares into common shares at a ratio of... (conversion ratio to be specified).

-60-

Conversion Procedures

Request The preferred shareholders of The Company may request for conversion by either of the following two methods:

(1) Conversion through book-entry transfer with the Taiwan Depository & Clearing Corporation (TDCC)

After the preferred shares of The Company have been listed (or traded) on the stock exchange, shareholders may fill out the "Application Form for Conversion/Redemption of Preferred Shares via Book-Entry Transfer" (specifying the request for conversion) at their securities brokers, and the brokers will then submit the application to TDCC on their behalf. Upon acceptance of the application, TDCC will forward it to The Company's stock transfer agent, and the conversion will take effect upon delivery without the option to cancel. The Company will then complete the conversion process within five business days after delivery and transfer the converted share certificate to the shareholder's securities account held with the TDCC.

(2) Conversion through The Company's stock agency

The holders of the preferred shares shall prepare the "Conversion Application Form" with their original seal affixed when requesting conversion, and submit the original of the preferred stock to The Company's stock agency for conversion. The conversion shall take effect upon delivery, and no revocation shall be allowed. After receiving the application for conversion, The Company's stock agency shall record the conversion in the shareholder register and deliver the certificate of rights within five business days from the date of receipt.

Adjustment of Share Certificate

If there are any changes to The Company's common shares (including but not limited to capital increases from retained earnings, capital increases from capital reserves, capital increases from employee bonuses, mergers, stock splits, and reductions in capital, but excluding the issuance of common shares due to the conversion of bonds or convertible preferred shares or the exercise of conversion or subscription rights granted to others), The Company will adjust the share certificates of shareholders recorded in the shareholder register according to the adjustment ratio of the common shares within 20 days after the record date.

Application for Public Offering of Preferred Shares

The preferred shares of The Company will not be listed for trading upon issuance. Pursuant to Article 68 of the Regulations Governing the Offering and Issuance of Securities by Issuers, after three years from the delivery date of the preferred shares, the board of directors of The Company may, at its discretion, apply to the Taiwan Stock Exchange for the public offering and listing of the preferred shares subject to market conditions.

Rights and Obligations after Conversion

From the effective date of conversion until one business day prior to the delivery date of the common shares to be issued, the rights and obligations of the preferred shareholders of The Company, unless otherwise provided by laws and regulations, shall be the same as those of the common shareholders of The Company.

Other Rights

(1) The holders of the preferred stock have the right to vote at the common stockholders' meeting, to elect directors, and to be elected as directors.

(2) When The Company issues new shares for cash, the holders of preferred stock have the same priority subscription rights as the holders of common stock.

(3) Both parties agree to redeem the unconverted preferred stock at the issue price.

(4) If the preferred stock cannot be redeemed due to legal requirements or objective factors, the dividend on the uncollected preferred stock shall be changed to an annual interest rate of 3% and may be accumulated, calculated based on the actual extended period.

Amendment of Issuance and Conversion Method

If this method is amended due to relevant laws and regulations or The Company's articles of incorporation, The Company may amend and announce this issuance and conversion method after the resolution of the board of directors, except for any amendment that would prejudice the rights of the holders of preferred stock, which must be approved by a resolution of the preferred stockholders' meeting.

Any matters not covered by this issuance and conversion method shall be handled in accordance with relevant laws and regulations.

-61-

Overseas Depositary Receipts: None
Employee Stock Options: None
New Share Issuance Restrictions on Employee Rights: None
Issuance of New Shares for Acquisition or Exchange of Other Companies' Shares: None
Financing Plans and Implementation Status
(1) Plan content: Refer to pages 100 - 101 of this annual report.
(2) Implementation Status: Refer to pages 100 - 101 of this annual report.

-62-

IV. Operations Profile

1.Business Scope

(1) Business Scope

Main Contents of Business:
(1) Centralized User Exchange Switch (CRCS)
(2) Communication Network Systems
(3) Data Communication Networks
(4) Private Automatic Branch Exchange (PABX)
(5) Wireless Communication Equipment
(6) Fiber Optics, Optical Cables, and Their Components
(7) Professional Microcomputers and Peripheral Equipment
(8) Switching DC Power Supply Equipment
(9) Microwave Communication Equipment
(10) Aerospace Communication and Control Systems
(11) Communication and Control Equipment for Rail Vehicles
(12) Testing Equipment for Communication Line End Users, Composite Terminal Boards, Safety Devices, Telephone User Loop Remote Telemetry Interface Isolators, and Line Facility Security Monitoring and Management Systems
(13) Internet Protocol (IP) Phones
(14) Mobile Broadband Communication Equipment
(15) Smart Home Systems
(16) Cloud-based Intelligent Home Monitoring Systems
(17) Smart Electromechanical Health Management Systems
(18) Various Sensors for Smart Electromechanical Systems
(19) ESG-Ready Management Platform
(20) EMS Management Platform
(21) ESCO-Related Services and Solutions

The research and development, design, manufacturing, sales, promotion, and after-sales service of the above items and their peripheral equipment.

Business Proportion:

Item	Proportion of Total Revenue for Fiscal Year 2025
Business Communication Systems	52.3%
Smart Electromechanical Series and Others	13.0%
Optical Cables and Optical Communication Components	34.7%

-63-

Current Products/Services and New products/services planned for development by The Company

(1). Current Products/Services:

A. Our business exchange system integrates digital and IP network switches, providing mobile extension apps, IP networks, fixed networks, and video communications. The complete range of digital and IP network switches, from 20 to 1000 lines, fully satisfies enterprise users' needs for voice communication, IP network communication, and integrated applications.

B. The TECOM Smart Monitoring product series includes the Hybrid HD Surveillance System, Network-based Intelligent Recognition Surveillance System, and Integrated Management System for Smart Monitoring Security. These products can be used in commercial offices, residential areas, as well as special project sites. The products can be customized and integrated with business switch systems for seamless operation. We continue to introduce system integration solutions.

C. The e-Home smart home system uses the latest mobile communication and cloud network technologies to provide users with secure, convenient, and comfortable high-quality smart home products. It features visual intercom, security alarms, message distribution, smart home, property functions, and can be controlled via the smart phone app for mobile intercom and monitoring, as well as situational control of home facilities.

D. The Smart Electromechanical products enable customers to monitor and detect the operational conditions of various electromechanical facilities such as motors, fans, pumps, and elevators using various sensing devices (vibration sensors, temperature sensors, electricity meters, etc.). We provide operational data and timely notifications for equipment maintenance and inspection to ensure optimal performance of all facilities.

E. The smart sensor product series features a lightweight and easy-to-install design, with simple operation to immediately obtain facility operating data.

F. TECOM CO, LTD. has launched a factory unmanned inspection solution that can greatly improve manual inspection operations. Wireless smart sensors are installed on all inspected equipment in the factory, automatically measuring and synchronously reporting, which not only improves manual operations but also avoids the two shortcomings of a) accuracy and b) occupational safety. Furthermore, it brings immediate smart automation elements to the factory, providing the fastest path to enter Industry 4.0.

G. In response to the requirement from the Energy Bureau of the Ministry of Economic Affairs regarding energy efficiency declaration for high-energy-consuming chiller and compressed air systems in factories:

Each factory is required to install necessary devices for hourly measurement and recording. Starting from the year 2023, they must annually declare the energy efficiency of the previous year's chiller system and compressed air system. In compliance with the Energy Bureau's requirement, TECOM has introduced the CEm Electromechanical Equipment Energy Consumption and Efficiency Management System to assist factories in meeting energy declaration requirements and achieving electricity cost savings.

H. M S O&M (Smart Operation & Management) - Intelligent Equipment Operation and Maintenance Management: The VB-800ML ("Golden Guardian") vibration meter uses advanced vibration technology to estimate the percentage of electricity waste in motor systems (motor + load), assisting factory managers in controlling power waste. It provides a new approach for factories to save energy, reduce emissions, and lower "hidden costs."

I. ESG Ready Platform: In addition to the above EMS, CEm, and MHEW functions, the platform now includes the CNm platform and carbon footprint products.

J. CNm Platform:

i. Provides a one-stop AI carbon management platform service, including carbon inventory consulting, system implementation, outsourced carbon inventory, and management services.

ii. Cloud-based energy-saving and carbon-reduction services for SMEs.

K. ESCO Services:

i. AI Energy-Saving Diagnostics and Data-Driven Solutions

Use the AI carbon management platform to conduct energy consumption diagnostics and simulate energy-saving benefits.
Launch an "AI Energy-Saving Health Check" service that automatically generates reports integrated with EMS data.
Develop measurable and verifiable energy performance management systems to support performance guarantees and subsidy applications.

ii. Collaborative Ecosystem and Channel Expansion

-64-

Establish an ESCO partnership ecosystem with financial institutions, leasing companies, and consulting teams.
Cooperate with strategic partners such as TECO Electric & Machinery Co., Ltd. to promote large-scale energy-saving projects for commercial buildings, hospitals, and industrial parks.
Promote ESCO subsidy programs for SMEs through government agencies such as the Energy Administration and SME Administration.

iii. Energy Retrofit and Managed Service Model
1. Launch "ESCO Managed Services," integrating planning, retrofit, operation and maintenance, and performance tracking.
2. Establish diversified contract models such as shared energy-saving benefits and performance guarantees.
3. Combine TECO equipment with the EMS platform to form an integrated "AI + Hardware" energy-saving solution.

iv. Regional Development and Demonstration Promotion
1. Establish demonstration projects for "Smart Energy-Saving Hospitals" and "Smart Factories."
2. Participate in government tenders for energy-saving subsidies and carbon management projects (such as Taiwan Water Corporation, Taiwan Railways, and the Tourism Administration).
3. Build an energy performance database based on successful project sites to promote regional expansion.

(2) New products/services planned for development by The Company are as follows:
- Carbon Footprint Inventory System
- Emergency Notification System
- SDX500M-PRO: An upgraded version of the existing SDX500 product, featuring a new chipset to enhance Quality of Service (QoS) and energy-saving performance.
- SD616-PRO: A modernized upgrade of the SD616, incorporating a new chipset to improve market competitiveness.
- Smart Gateway AG-350: The e-Home 6.0 smart home system introduces a new e-gateway to enhance intelligent control capabilities.
- EMS Management Platform: Enhanced functions for green power generation systems, lighting systems, remote control, and ISO 14067 product carbon footprint management.

-65-

-66-

Industry overview

1. Industry Status and Development

In recent years, the development trend of the Internet of Things (IoT) has been strong. The mobile communication industry, with smartphones as its main product, has made mobility and APP indispensable basic elements in product planning. Mature 4G/5G technology has driven various application services and related markets, including mobile broadband, cloud applications, smart homes, and Industry 4.0.

The Company's new product development uses IoT technology, cutting-edge information and communication technology, and provides a fully intelligent health management platform for electromechanical equipment in factories, as well as the development of sensing components such as vibration, temperature, and electricity measurement. Through the network, real-time, bidirectional, and interactive intelligent operation and control can be achieved, bringing the latest generation of maintenance and automation benefits to factory owners.

For the development of smart home products, we invest in various types of smart video doorbells and smart home care systems based on the needs of families for security and automation. As the home gateway products are successfully installed in individual cases, their contribution to revenue also grows.

The nearly global coverage of the IoT, the widespread use of smartphones and mobile terminals, the extensive coverage of wireless networks, and the rise of other internet technologies and online payment and digitization technologies have all been influenced by the rise of the internet in various aspects of human life. The internet has brought a whole new way of life and channel models.

Enterprises seek to ensure the information network security of internal communication and external communication, while consumers' awareness of personal data confidentiality increases. This will be the focus and necessary functional requirement of future product security. Our Fusion Access System has a dual-layer login authentication function to ensure the security of consumer and enterprise information.

As for improving operational performance, in order to reduce operating costs and enhance operational competitiveness, the advantages of ODM design and strong cooperation with EMS professional manufacturers are introduced to enhance overall competitiveness and customer satisfaction, and achieve The Company's operational profit goals.

Regarding EMS Function Optimization:

Driven by AI-enabled smart energy transformation, the Company is building an energy management ecosystem that combines intelligent control with sustainable services.

Integrate renewable energy sources into the EMS platform to achieve coordinated multi-energy control and optimized dispatching.
Establish the foundation for virtual power plant applications, supporting renewable energy integration and energy exchange management.
Promote digitalization and intelligent management of renewable energy data, and introduce AI to optimize energy management decision-making.

Expansion of Industry Applications

Develop EMS application solutions for the manufacturing sector, medical institutions, and commercial office buildings, creating cross-industry implementation models.
Build pilot demonstration systems for medium and large customers to create successful cases with scalable market potential.
Launch tiered EMS SaaS solutions to increase adoption among small and medium-sized enterprises.

-67-

Smart Monitoring and AI Optimization

Establish AI-based energy-saving control models for chillers, air compressors, lighting systems, and other equipment to improve overall energy efficiency.
Introduce AI predictive maintenance and health management (integrated with SO&M) to reduce the risk of unexpected downtime and lower maintenance costs.
Establish mechanisms for energy consumption forecasting and abnormality analysis reports to promote data-driven energy-saving decisions and continuous improvement.

Strategic Partnerships and Regional Development

Cooperate with TECO Electric & Machinery Co., Ltd. and third-party partners to jointly promote energy-saving solutions and establish collaborative promotion mechanisms.
Expand into Southeast Asian and Middle Eastern markets by exporting the AI smart energy management platform.
Integrate ESCO ecosystem partners with financial institutions to promote “Smart Energy Saving + Financing” solutions, thereby expanding cross-sector collaboration and market penetration.

2. Industry Upstream, Midstream, and Downstream Relationships

(1) The Company mainly designs and manufactures network communication-related products and equipment, which belong to the midstream manufacturers in the industry chain. The upstream, midstream, and downstream relationships are as follows:

Upstream	Semiconductor IC design chip manufacturing memory	PCB boards Passive components Antennas	Power supplies Mechanical parts Packaging materials Connectors
Midstream	Network Communication, Smart Home, Smart Electromechanical Products R&D and Manufacturing
Downstream	Network Equipment Suppliers System Integration Manufacturers	Distribution Channels	Telecommunications Operators

(2) Telecommunications Industry Upstream, Midstream, and Downstream Relationships

3. Various development trends and competitive landscape of the product

(1) Cloud and Mobile Devices

The applications of cloud computing, the Internet of Things (IoT), and mobile devices continue to be a global trend in technological development. It is expected that companies will invest more resources into the various related services of this trend for their future applications and development. In light of this, targeting a mobile broadband architecture, innovative features combining cloud computing can be developed for cloud-based mobile PBX systems and services, as well as a converged network access system. By integrating mobile intranet and existing enterprise fixed broadband networks, low-cost mobile internet access, secure internal data access, and network application services can be provided, significantly reducing the overall mobile internet expenses of enterprises and effectively lowering their operating costs.

(2) Industry 4.0 Drives the Rise of Smart Factories

Under the wave of Industry 4.0, enterprises and governments are jointly striving to continue moving towards digital transformation. Smart factories, which combine IoT, robotics, sensing technology, and data analysis, are being established one after another, extending to "smart logistics" and "smart services" and driving industry upgrading. Smart factories are a trend that includes several features:

Additional sensors installed on all equipment, materials, semi-finished products, and finished products in the factory.
Large-scale use of robots for automated production, combined with IT for real-time quality monitoring to improve efficiency and stabilize quality.
> Comprehensive automatic measurement (AOI, ATE, robot arms, etc.) for fine calibration adjustments, which can also manufacture products in real-time in response to changes in orders.
Utilizing on-site monitoring systems to collect a large amount of production equipment and product data, which is transmitted to cloud servers. Through Big Data analysis, decision-making accuracy is improved.
Accumulating a large amount of consumer data, analyzing and understanding customer habits and predicting customer needs. The business model shifts from B2C to a customer-oriented approach, "diverse and small quantities" of C2B customized production and sales, allowing customers to return.

The development impact of Industry 4.0 is long-term. To respond to the rapidly changing market, many companies choose to place their manufacturing plants near their customers to uncover more demand, respond quickly, and provide the services that customers need. As the market demand for production lines' flexibility increases, how to control the status of each machine and equipment to make the production process smoother and faster is a problem that enterprises must consider when transitioning to a smart factory. Therefore, the demand for smart electromechanical monitoring system equipment will increase year by year to ensure that the stability of the factory's machinery and equipment is sufficient to support automated production.

(2) Overview of Technology and R&D

R&D expenses incurred in the latest fiscal year ending March 31, 2026.

Unit: in thousand NTS

Fiscal Year	Fiscal Year 2025	As of March 31, 2026
R&D Expenses	72,163	17,325

Due to The Company's strong R&D capabilities being recognized by a leading international telecommunications giant, we have been able to secure partial product development funding from our customers. This not only helps us achieve cost efficiency but also increases the likelihood of successful new product development, ultimately achieving a win-win situation for both The Company and our customers.

Technology or products developed successfully

As a company that has been dedicated to research and development since its founding in 1980, we have established R&D centers on both sides of the Taiwan Strait. Our engineers have an average of more than 10 years of experience in telecommunications and network product development, making us a leading force in the domestic market and the main driver of our continuous growth.

Our main focus is on the research and development, as well as the manufacturing, of a full range of professional-grade communication equipment, including commercial digital communication system products, e-Home systems, wired and wireless communication transmission system equipment, voice transmission system equipment, integrated access equipment, and fiber transmission system equipment. We are the only company in Taiwan that integrates voice communication, network communication, wireless communication, optical communication, and mobile communication services.

Our various products have been recognized by professional organizations and customers both domestically and internationally, and have won awards such as the "Science Park Innovation Product Award" for the UMA indoor base station, the "Science Park Innovation Product Award" and the "National Quality Award" for the e-Home system, the "CES2011 Innovation Award" and the "Science Park Innovation Product Award" for the intelligent IP exchange machine IG6600, and the "Best Supplier Award for 2013" from Japanese communications giant OKI, among others. Additionally, the first iPad Docking Phone in Taiwan received Apple MFi "Made for iPad" certification.

In response to global trends, we have launched products that integrate voice, data, imaging, and mobile communication. Our main products include broadband communication products, Industry 4.0 smart electromechanical products, smart phone business communication systems, 4G LTE Small Cells, cloud-based intelligent service gateways, cloud-based smart video doorbells, and smart home systems, among others.

Our newly developed "Unmanned Inspection" solution for factories uses artificial intelligence and machine learning to compute the health index (Hx) of inspected equipment in the vibration and temperature domains. This solution provides precise alerts and predictive maintenance schedules automatically, greatly improving the deficiencies of traditional "manual inspection". The sensors used in the Unmanned Inspection solution have built-in calculation modules (MCUs) that leverage machine learning (ML) and artificial intelligence (AI) algorithms to obtain the median value of vibration during normal operation of the inspected electrical machinery, which serves as a health benchmark. The weighted computation then produces a health index for the electrical machinery, which is classified into nine levels (H9 being the healthiest and H1 being the least healthy) to accurately express warning and alert states. This is a unique and significant innovation in the market. Based on the health index levels, it can accurately suggest predictive maintenance schedules, avoiding the cost of "over-maintenance" and evolving from traditional "preventive maintenance" to "predictive maintenance".

The awareness of ESG (Environmental, Social, and Governance) is increasingly prevalent, with government regulations in various regions and supply chain requirements across industries. It has become essential for businesses to establish ESG capabilities. TECOM, as a leading company, has introduced the ESG-Ready management platform to assist enterprises in rapidly establishing comprehensive ESG capabilities.

The TECOM ESG-Ready solution is designed with a comprehensive modular approach, allowing enterprises to choose and deploy the necessary functionalities at their own pace. This step-by-step approach enables the establishment of ESG capabilities and achieves optimal investment outcomes.

The ESG-Ready management platform consists of four major software modules, each serving as a tool to achieve specific ESG goals. The four functional modules are:

CNm (Carbon Neutral management) Greenhouse gas inventory management
EMS (Energy Management System) Electricity consumption management
CEm (Consumption Efficiency management) High-consumption equipment efficiency management
S O&M (Smart Operation & Management) Intelligent Equipment Operation and Maintenance Management

(3) Long and Short-Term Business Development Plan

Main Business Development Direction

As a high-tech communication system equipment manufacturer, Tecom Co., Ltd. continues to move forward and provide innovative value-added services to its customers as our corporate mission. In addition to

-69-

utilizing the solid foundation established by the "Multi-Network Integration," we have continuously launched new-generation cloud service home gateways, smart homes, and intelligent monitoring products to enhance the safety and automation of household users, in order to strengthen customer satisfaction and pursue a quality-first attitude, striving to enhance existing customer relationships and optimize current customer and product portfolios. Improving operational efficiency, increasing production capacity utilization, and achieving reasonable profits are short-term business development indicators.

ESG and AI applications have become major global trends in recent years. In particular, "net-zero emissions" has become one of the most critical issues for businesses, especially as governments worldwide tighten environmental regulations. Companies must comply with these regulations and meet supply chain order requirements, making this a key focus in business operations. Meanwhile, "smart manufacturing" continues to be a significant and ongoing priority for governments, which have also designated "smart machinery" as a key part of industrial innovation policies. This clearly shows that "intelligent automation" and "AI integration" are crucial steps toward industrial upgrading. TECOM Company has always been at the forefront of the industry, from network transmission services to mobile applications, from data collection to cloud services, from IoT to IIoT, and now aiming for AIOT and AI adoption and solution-based one-stop services are the company's primary operational goals and development focus. These aim to assist industries in complying with government environmental regulations, as well as accelerating the transformation and intelligent upgrading of smart manufacturing through AI integration.

With growing awareness and implementation of ESG, alongside increasingly stringent environmental regulations by governments worldwide and rising supply chain demands across industries, enterprises must build robust ESG capabilities. Our company takes the lead by launching the ESG-Ready platform to help businesses quickly establish comprehensive ESG capabilities. Tongxun has independently developed four major ESG Ready platforms: EMS and AI Carbon Management Platform focus on management-based carbon reduction, while SOM and CEm focus on equipment-based carbon reduction. Under this framework, Tongxun offers a solution-based one-stop service that includes both "equipment carbon reduction" and "management carbon reduction" functions. To support enterprises in taking the first step toward "net-zero emissions," Tongxun has introduced an AI-powered high-tech greenhouse gas inventory solution (AI Carbon Management Platform).

Recently, there has been growing social consensus in Taiwan regarding net-zero emissions and sustainable development. Enterprises understand and recognize that net-zero is a social responsibility, a government mandate, and a requirement for export orders. To assist companies in smoothly completing greenhouse gas inventories, Tongxun offers the "AI High-Tech Proxy Inventory Service," which helps enterprises easily get started and addresses two major concerns in current inventories: (1) accuracy (human errors) and (2) reliability (inventory procedures). Heavy power-consuming equipment in factories across industries, such as chillers and air compressors, often wastes electricity when failing to meet the Energy Bureau's standards under the Ministry of Environment. This can cause power waste amounting to millions of New Taiwan dollars, and rising electricity prices make this issue more severe. Tongxun provides a "Heavy Equipment Energy Efficiency Parameter AI High-Tech Proxy Measurement Service," which measures various parameters and uses AI machine learning technology to accurately calculate equipment energy efficiency, comparing it with the standard efficiency values published by the Energy Bureau. This service helps factories identify electricity waste and additional carbon emissions data, providing a strong basis for energy saving and cost reduction.

In addition to the AI-powered proxy measurement services mentioned above for the factory's three major high-energy-consuming equipment—chillers, air compressors, and large motors—recent government policies promoting carbon trading and carbon pricing have accelerated enterprises' adoption of electricity management (EMS) platforms. TECOM offers a robust EMS solution that provides enterprises with both EMS platform implementation and outsourced EMS electricity management services.

Equipment carbon reduction, also known as "equipment carbon reduction," is achieved through efficient equipment operation, which is more tangible and quantifiable compared to management-based carbon reduction methods, making it increasingly popular for energy conservation and carbon reduction.

2. Short-Term Business Development Plan

Smart Mechatronics:

The systematic management of electromechanical equipment in factories is becoming increasingly important. Starting with the sensor (vibration sensor) data acquisition, The Company has been deploying a more comprehensive range of such products, from wired to wireless sensors, and even to higher technology

-70-

machine learning Bluetooth wireless vibration-temperature sensors, to meet the application needs of various industries and equipment, and to accelerate the competitiveness of intelligence, differentiation, and unmanned automation.

To achieve comprehensive intelligent operation and maintenance (O&M) in factories, our company has also launched an intelligent inspection device designed to meet the needs of various types of factories and integrate seamlessly with existing systems. Compared to conventional inspection devices on the market, this solution offers greater systematization and efficiency. Additionally, we provide customized services to support factories in advancing toward full intelligent O&M. The architecture and functionalities of our SOM intelligent O&M platform are as follows:1. Our system products adopt a three-tier architecture for the Internet of Things: Sensor, Gateway, Cloud & Local Site.

This platform supports various types of sensors, both fixed and mobile, empowering the digitization of manual inspections without altering the customer's existing inspection methods. This enhances the efficiency of manual inspections. For critical equipment, fixed sensors are used to provide more frequent data collection, which is then uploaded to the intelligent operations and maintenance management platform (including both on-premises and cloud solutions). This enables real-time monitoring of the health status of key equipment, ensuring the normal operation of factory facilities and production lines, and improving operational efficiency.
Our company also provides intelligent gateways supporting 4G/5G/WiFi and fixed networks, which can transmit industrial big data collected from factory sites and equipment to the central control center, thereby reducing management workload. The SOM platform by Dongxun offers both on-premise security and cloud efficiency, providing powerful intelligent operation and maintenance management capabilities:
Situation Room, IoT APP, real-time push notifications, database, trends, analysis and diagnosis (optional), alerts, records, administrative management, reports, etc.
IoT real-time push notifications for alerts, and decision-making on repairs or updates based on health deterioration.
Cloud access anytime.
Monthly download of management reports.
TECOM has launched the next-generation motor intelligent inspection device, which utilizes a portable smart vibration meter paired with a patented intelligent inspection app (available on Android phones or tablets) to measure next-generation vibration data. Data can be uploaded to the backend inspection database and the on-premise SOM platform service with one click. Combined with three categories of report services required by various levels of client personnel, this forms an integrated "trinity" service.
TECOM has also launched a factory-wide motor health management data statistics software module. This module performs multiple statistical analyses on the health status of all motors across the factory. Supervisors do not need to access each motor's individual database; they can understand the entire factory's motor health status at a glance from the statistical analysis results. Furthermore, based on these multiple statistical outcomes, factory maintenance baselines and standards can be established, existing policies can be revised and improved, and the overall maintenance performance of the factory can be tracked.

Electricity prices in our country have risen multiple times over the past one to two years, with no expectation of decrease in the foreseeable future. The installation of EMS has become urgent for enterprises. Effective electricity management requires various electricity usage data to assist enterprises in quickly identifying and replacing low-efficiency equipment while immediately implementing carbon reduction measures. For enterprise customers, delaying carbon reduction measures even for a day can have a direct and negative impact on profitability.

To achieve effective management, robust software with powerful management functions is necessary. The EMS introduced by TECOM has six main functions:

Energy baseline
Electricity analysis
Energy management
Intelligent dashboard
Power alarm report
Mobile APP

Unlike many EMS systems, TECOM's EMS solution allows for immediate energy-saving measures, enabling factories to identify high-energy-consuming equipment wasting electricity within 2 to 4 weeks and make repairs or replacements as needed, potentially achieving significant energy savings of 10% to 15%. This fully meets customer needs and greatly enhances market competitiveness and market share.

-71-

Furthermore, TECOM's advantage over other competitors lies in its ability to assist enterprises in implementing EMS applications by:

1) Introducing TECOM's designated ISO 50001 counseling experts to guide enterprises in obtaining ISO 50001 certification.
2) Providing DongYuan Group's experience in electricity conservation and emission reduction implementation.

TECOM Smart Energy and Carbon Management Platform

Highlight 1 | AI Power Dispatching Brain

Integrates electricity consumption, energy storage, solar power, and green power trading.

Optimizes power allocation in real time to reduce contracted capacity and peak electricity charges.

Highlight 2 | Digital Twin Command Center

Real-time monitoring of HVAC, lighting systems, EV charging stations, and other equipment.

Visualized presentation of energy consumption hotspots and abnormal conditions.

Highlight 3 | Forecasting × Energy Storage × Demand Management

AI forecasts load demand and power generation output.

Works with energy storage systems to intelligently shave peaks and fill valleys.

Highlight 4 | Smart Operation & Maintenance with Knowledge Graphs

Equipment health diagnostics and anomaly alerts.

Improves maintenance efficiency and reduces reliance on manpower.

AI Energy Dispatching Hub

One platform integrating all building energy resources.

☑ AI real-time power dispatching
☑ Solar power × Energy storage × Green power integration
☑ Digital twin command monitoring
☑ Peak shaving × Electricity cost optimization
☑ Smart O&M × Anomaly alerts

In assisting clients to establish ESG capabilities, TECOM, a leading company, has introduced the ESG-Ready platform to help businesses quickly establish comprehensive ESG capabilities. The ESG-Ready platform framework and product solutions consist of a foundational management platform that includes standard specifications: visualization, communication, computing, IoT apps, database, trends, analysis, alerts, records, administrative management, and reporting, encompassing 11 powerful features. Additionally, advanced specifications such as artificial intelligence/big data analytics and carbon reduction prediction models make TECOM's technology and product solutions stand out among competitors in the industry. The foundational platform can integrate four major ESG software modules: AI Carbon Management Platform and Greenhouse Gas Inventory (AI-DT), EMS (Energy Management System) - Electricity Consumption Management, CEm (Consumption Efficiency Management) - High Energy Consumption Equipment Efficiency Management, SOM (Smart Operation and Management) - Intelligent Equipment Operation and Maintenance Management Platform. Among these modules, SOM currently stands as an exclusive and leading market technology and product solution for obtaining the necessary information for electricity waste control. It assists factory managers in implementing electricity waste and greenhouse gas control. Since its launch, EWm has gained significant customer favor and has been rapidly adopted and verified through proof-of-concept (POC) tests. Customers have the flexibility to choose functionalities, deployment schedules, and investment considerations during ESG deployment. TECOM's ESG-Ready solution is designed with comprehensive modularity, allowing enterprises to select and deploy the necessary functionalities at any given time, step by step, to establish ESG capabilities and achieve optimal investment results, creating a win-win situation.

Information and Communication Systems:

(1) PBX Business Telephone System

With Panasonic's exit from the switchboard market, various manufacturers have begun to vie for market share. In addition to its existing large-scale systems (IP1000L, SDX500) and small-scale systems (SD616A), TECOM will introduce a mid-sized system (SDX500 lite) to strengthen its product line. Simultaneously,

-72-

TECOM will aggressively enter the market with the new MOCET small IP PBX system under a new brand and product line, aiming to capture market share from competitors. Additionally, to assist existing digital switchboard customers in upgrading to IP mobile extensions, TECOM has launched a new product, MEKT, in Marchl, which can be connected to desktop extensions to realize the convenience of "phone as an extension."

(2) CCTV Intelligent Surveillance System

In view of the increasingly serious cybersecurity issues in the surveillance market, the Company has launched self-branded surveillance products together with the dedicated Tecom View app. All devices and accessories comply with relevant standards, including BSMI, CE, and FCC certifications.

Certain models are equipped with AI functions. When integrated with the Company's PBX system, they can provide diversified intelligent real-time alerts, effectively improving notifications while reducing manpower requirements and enhancing efficiency.

(3) Mobile Communication Products

In the mobile communication product category, TECOM offers the FG8552 industrial-grade 4G LTE mobile router. This device operates reliably in harsh environments, with standing temperatures ranging from $-30^{\circ}\mathrm{C}$ to $+70^{\circ}\mathrm{C}$. It has been used in long-term partnerships with electric scooter charging stations, providing stable 4G data transmission. TECOM also offers other products such as the FG8102 4G router and FG8661 5G industrial-grade router, which are widely utilized in fields such as video surveillance, environmental monitoring, security providers, and smart electromechanical systems. These products provide mobile network transmission services in areas where physical network cables are difficult to reach, catering to various customer scenarios.

Product competitiveness is crucial for increasing sales. Therefore, it is essential to enhance product technology, quality, and functionality to meet customer demands. Furthermore, expanding online and offline sales channels, actively collaborating with various industries, and participating in exhibitions help to increase product sales and enhance brand exposure and recognition.

After-sales service is equally important for customers. Providing excellent after-sales service enhances customer satisfaction and increases loyalty. Therefore, prioritizing after-sales service and offering comprehensive technical support and assistance is a crucial guarantee for successful sales.

Long-Term Business Development Plan

The main objective of the plan is to extend existing network services to mobile applications, cloud, Internet of Things, and expert systems. The development directions include:

Application Integration:
Keep up with global communication network product technology trends.
Integrate channel resources to increase productivity of business personnel, and strengthen all-round product connections with customers.
Utilize the energy of strategic partners from various fields, cultivate the smart home service market, and provide all-round digital life needs.
Integrate group resources, leverage operational synergy, and develop information and communication integration service projects to expand the market.
Strive to represent first-line brands and competitive products, and seek to lay out second and third-line brands with high cost performance as agent businesses, and combine them with online shopping platforms to create operational efficiency, multi-channel sales, and diversified revenue and gross profit for diversified products, channels, and intelligent digital products.
Mobile communication technology is rapidly developing towards 5G. TECOM will gradually introduce 5G application products such as IIOT, AIOT, etc. to meet more diverse smart network needs.
Through the Internet of Things (IOT), the application of 5G technology further increases the efficiency of predictive maintenance for factories, and promotes the market demand for predictive maintenance.
Information and Communication Systems:
Integration of PBX Business Telephone Systems, CCTV Intelligent Surveillance, and Mobile Communication Products

-73-

We maintain close collaboration with system operators such as Chunghwa Telecom and Far EasTone to create new business revenue streams. Our successful cultivation of 4G network applications has led us to advance to 5G applications and explore new market opportunities. In terms of integrated network access systems, we have successfully combined the operator's preferential bandwidth rates and monthly fees with flexible customized networking functions, audio-visual streaming, data network transmission, and intelligent monitoring services for large enterprises and chain stores. In addition, we actively participate in bidding and invest in smart city construction plans promoted by various county and city government units, including smart parking, intelligent traffic control at intersections, traffic flow monitoring, and environmental monitoring, by providing 4G and 5G-related network products such as Fusion VPN and various routers, as well as AI intelligent monitoring series products, to obtain the best revenue and profits.

(2) e-Home Smart Home System

Government Promotes Net-Zero Carbon Policy, Smart Building Certifications Support Energy Saving and Carbon Reduction

The government is actively advancing net-zero carbon emission pathways, including regulations covering public buildings, private residences, and office/factory buildings. The "Building Energy Efficiency Label" standards have been established. Additionally, the 2024 edition of the Smart Building Certification Assessment Manual incorporates multiple basic requirements and encouragement measures to support buildings in obtaining energy efficiency and smart building certifications, improving building operation and maintenance management, and progressing toward the government's net-zero carbon goals.
Key focus areas currently being promoted include "Operation & Maintenance Management," "Security Monitoring," and "Energy Management," for which standard formats have been set by relevant authorities. Electromechanical equipment in residential complexes (such as water pumps, generators, elevators, etc.) must have predictive maintenance capabilities, creating a pressing need for smart electromechanical product solutions. According to the Ministry of the Interior's Architecture and Building Research Institute regulations, the Low-Carbon Building Labeling system will be officially implemented starting July 1, 2025. Buildings achieving a low-carbon rating of Level 4 or above will meet the low-carbon building standard. These regulations aim to reduce carbon emissions throughout building material production, transportation, construction, renovation, and demolition stages.
Through the integration of TECOM's smart electromechanical products and energy-saving solutions, predictive and diagnostic functions for the operation of rotating electric motors can be provided, reducing energy consumption caused by early failures and greatly improving the overall energy-saving benefits.

2. Market and Sales Overview

(1) Market Analysis

Sales regions and market share of main products/services

The main sales regions of The Company's products are Asia (including domestic market), North America, and Europe. In the future, we will continue to explore new customer groups in various regions through market cultivation and new product development strategies to sustain this growth momentum.

As for the future market growth, with the successful launch of our e-Home smart home system, cloud-based smart service gateway, and related cloud-based smart ICT integrated application systems, the market demand for related products is expected to grow. This will make a significant contribution to The Company's revenue and profit growth.

Please refer to the table below for our sales regions and revenue:

Region	Fiscal Year 2025
	Amount	%
Taiwan	688,097	93.94%
America	6,972	0.95%
Others	37,439	5.11%
Total	732,508	100.00%

Market Future Supply and Demand and Growth Potential

(1) Information and Communication Systems

PBX Business Telephone Systems

For a long time, TECOM Company has been continuously investing in the development and sales of system products, and has been promoting its own brand in the domestic small and medium-sized enterprise market. In particular, it has maintained a leading position in the field of PBX systems, with a market share of over 50%, making it the number one brand in the domestic market.

With the IP-ization of communication networks and the widespread popularity of smartphones, various network-based software and hardware are becoming more widespread, providing more convenient and cost-effective services. Traditional fixed-line phones can only provide voice applications, which is clearly not in line with the global trend of IP-ization.

It is estimated that more than 70% of the current 1 million enterprise users in our country are still using traditional digital exchange PBXs. However, with the advent of the 5G era, the willingness of enterprise users to upgrade to IP network exchange PBXs has been increasing year by year. This has created a new blue ocean market for communication systems on the enterprise side. If combined with the support of cloud-based diversified value-added application services, it will accelerate the adoption of the latest cloud-connected PBX systems by enterprises, in line with the rapid evolution of the times.

In addition to traditional digital exchange systems, TECOM's PBX systems also provide advanced IP network exchange systems, which integrate mobile networks, IP networks, fixed networks, and video communications, and provide a complete range of exchange systems to fully meet the needs of enterprise users for voice communications, IP network communications, and integrated applications. Moreover, the PBX cloud-based value-added service platform solution can fully demonstrate a forward-looking vision and fully meet the needs of modern enterprises for cloud-connected PBX systems.

e-Home Smart Home System

Currently, the market sees an average of 90,000 new housing units introduced each year. With a market share of almost 30%, TECOM ehome's intercom device serves as the foundation for integrating various weak-current and electromechanical systems to create a cloud-based smart community system that can be widely used in every community.

As part of the government's 2050 net-zero pathway planning, reducing carbon emissions and energy consumption in the construction industry is a necessary measure to achieve net-zero emissions.

According to data from the National Sustainable Development Committee of the Executive Yuan, Taiwan's 2050 net-zero emission pathway will be based on four major transformations: energy transformation, industrial transformation, lifestyle transformation, and social transformation, supported by two governance foundations: technological research and development and climate legislation. In addition, the government has formulated twelve key strategies covering energy, industry, and lifestyle transformation policies to promote green growth.

According to the Architecture and Building Research Institute of the Ministry of the Interior, the 2024 edition of the Building Energy Efficiency Assessment Manual (BERS) will be officially implemented from July 1, 2025. The low-carbon building labeling levels are based on the evaluation of a building's whole life-cycle carbon footprint. These regulations aim to reduce carbon emissions during building material production, transportation, construction, renovation, and demolition stages.

TECOM has developed the "Integrated Building Management System" (IBMS), also known as the "Smart Home Platform," which integrates: access control, surveillance, central monitoring, and intercom systems. It also incorporates energy management functions, including electricity management and carbon emission calculations. The platform assists building owners in achieving intelligent functionality in terms of safety, health, energy efficiency, and management. Moving forward, all platform functionalities will be cloud-based, expanding from new constructions to existing buildings.

(2) Smart Electromechanical

The Company offers a "smart unmanned inspection program" to leading companies in various industries with multiple factory locations. This program employs artificial intelligence and machine learning to calculate the health index (Hx) of inspected equipment in terms of vibration and temperature, providing accurate alerts and predictive maintenance schedules automatically. It greatly improves the shortcomings of traditional "manual inspections." To fully achieve comprehensive intelligent operation and maintenance (O&M) for factories, we have launched a smart inspection device that can be integrated into on-site systems, meeting the management needs of various types of motors in different factories. This allows customers to quickly experience Tongxun's powerful and comprehensive intelligent O&M

-75-

platform, which offers flexible options for required reports. The service is provided on a monthly subscription basis, enabling customers to easily obtain the reports they need, allowing personnel at all levels to access different reports as required.

To meet customers' special needs in intelligent O&M, we accept various customized research and development projects. Besides satisfying individual customer requirements, these solutions can also be standardized products to broaden market reach and provide more diversified services. Examples include smart health inspection devices for elevators, vibration measurement and predictive alert systems for robotic arms, and more.

We actively promote our installed customer base using wired and wireless smart equipment O&M management platforms such as MHm-P, MHEW, and SOM. Customers can purchase additional data statistics software modules and seamlessly upgrade their systems. Within a short period, data from hundreds of motors across the factory can be collected and analyzed statistically. Based on these statistics, factory maintenance baselines and standards can be established, allowing for policy adjustments and improvements, and enabling ongoing monitoring of the factory's maintenance performance.

We continue to promote the installation of vibration sensors on TECO's large and small frame motors to transform them into smart motors, helping to enhance their global competitiveness. We are also actively expanding the electromechanical equipment maintenance market in the United States, Japan, Southeast Asia, and China.

We are actively bidding for vibration measurement projects related to various components of the Taipei Metro (e.g., train cars, escalators, fans, and axles) to expand our vibration monitoring business among all rail companies. Having successfully implemented the MHm-P smart electromechanical health management system in the Taipei Metro, we can apply the system to various data collection and system applications across the Taipei Metro, enhancing our adherence to multiple Taipei Metro operations. At the same time, this experience will also be extended and promoted to all sectors of the rail transportation industry.

We are strongly and continuously promoting the AI high-tech greenhouse gas inventory solution (AI-Carbon Management Platform) to large corporations. Beyond the company headquarters itself, there is increasing demand for "greenhouse gas inventory" certification from upstream and downstream supply chains, driving the need and execution of inventory operations. This will be extended and expanded to publicly listed subsidiaries and their supply chains.

Especially for companies exporting mainly to Europe and the Americas, the greenhouse gas inventory tools and management platforms are in great demand, generating unlimited and continuously growing business opportunities.

The AI-Carbon Management Platform developed by our company is based on AI-driven approaches, with the latest generation focusing on "management." It has already been adopted by the Ministry of Economic Affairs as the designated management platform for 25,000 SMEs. Currently, the platform covers Scope 1 and Scope 2 emissions, and it is planned to incorporate carbon footprint tracking and include Scope 3 by Q1 2025, thereby meeting the needs of more customers.

The AI-Carbon Management Platform from our company includes the following two components:

1) AI-DTDigital inventory tools:

Using AI recognition technology to automatically scan emission invoices and receipts, obtaining digital data. Built-in software for "automatic inventory list generation" arranges the recognized digital data automatically to create an inventory list compliant with regulations.

2) AI-Carbon Management Platform:

Based on the inventory list data, set emission reduction targets, formulate management improvement plans, and track implementation effects. The five main functions are:

Intelligent emission dashboard
Multi-zone emission management
Total list aggregation
Alert reports
Mobile APP

The above fully meets customer needs. Our goal is to help clients easily comply with increasingly stringent environmental regulations and simplify the verification process, greatly improving efficiency

and accuracy. This will significantly benefit us in capturing market opportunities and expanding market share.

In addition to sales, we also provide AI high-tech proxy verification services to assist enterprises in smoothly completing their greenhouse gas inventories. The Ministry of Economic Affairs' Energy Bureau has set threshold requirements and inspection regulations for heavy electricity-consuming equipment (such as chillers and air compressors). For large factories, TECOM Company offers a "Heavy Equipment Energy Efficiency Parameter AI High-Tech Measurement Service," which measures various parameters and uses AI machine learning technology to accurately calculate equipment efficiency, comparing it against the Energy Bureau's published standard efficiency values. This service helps factories grasp their electricity wastage and additional carbon emission data, providing strong support for energy-saving and cost-reduction efforts.

In the wave of energy saving, carbon reduction, and ESG (Environmental, Social, and Governance) initiatives, 136 countries worldwide have already declared their commitment to achieving net-zero emissions by 2050. To meet this goal, leading global brands are demanding carbon neutrality throughout their supply chains. Our company's ESG Ready product line offers two unique emission reduction solutions: 1. Equipment Health-Based Emission Reduction, and 2. Management and Scheduling-Based Emission Reduction. These solutions have already received certification from government agencies and have been adopted by leading enterprises across various industries. With this solid foundation, our company is well-positioned to further expand into broader markets and attract more customers. To that end, we have invested significant resources into developing comprehensive net-zero emission solutions. As the next step, we plan to actively pursue the business scope of Electricity-Saving Management Technical Consulting Services (ESCO). This move will elevate our offerings beyond product and technical solutions into higher-level consulting services. By adopting this dual-track approach—combining cutting-edge products with expert consulting—we aim to deliver broader, more advanced, and more integrated services. This will help us win greater recognition and adoption of TECOM's solutions, not only in the private sector but also through expanded collaboration with relevant government agencies. This development will mark a new milestone for TECOM in the field of net-zero emissions.

Competitive Niches

In recent years, we have actively invested in the development of new-generation smart home products and the application of "smart buildings" in communities. By using sensors connected to cloud platforms, relevant electricity, water resource, and environmental monitoring can be quickly established and controlled. This enables the development of energy-saving solutions that meet market demands to comply with the trend of net zero carbon emissions for buildings. In the future, we will continue to expand into new customer groups in various regions through market cultivation and new product development strategies, in order to sustain this growth momentum.

As for the future growth of the market, based on the successful launch of cloud-based intelligent ICT integrated application systems and services such as smart electrical and electronic products, cloud-based intelligent video doorbells, all-network intelligent home systems, and cloud-based intelligent service gateways, the market demand for related products is expected to grow. This will make a significant contribution to The Company's revenue and profit growth.

2. Opportunities, Challenges, and Strategies for Development

(1) Opportunities:

A. Continuing investment in research and development of next-generation communication technologies will enable us to provide customers with high-quality differentiated services and establish long-term and stable partnerships.

B. Our "multi-network integration" communication technology and products have become one of the mainstream trends in the market, and have been adopted by major telecom operators. As new application products continue to be launched, they will continue to bring growth momentum to The Company.

C. We have launched a full-network smart home system that meets market demand, integrates security control and automation needs, and has the potential to lead the future of mobile communication services. This represents a vast market potential.

-77-

D. The development of wireless local area network voice communication systems, integrating broadband networks, wireless network telephones, and related access technologies, has significantly enhanced the competitiveness of our product line.

E. With the growing prevalence of the Industrial Internet of Things (IIoT), our various MEMS vibration sensor products have gained a market advantage and are being shipped in large quantities. We will continue to deepen our expertise and expand our leading edge.

F. Under the ESG trend, the wave of ESG initiatives presents favorable conditions for promoting and selling our company's ESG-Ready products.

(2) Challenges

A. Currently, the cost of labor in manufacturing production bases continues to increase, and cost increases are not easily transferred, resulting in a lower operating profit margin.

B. In recent years, equipment suppliers in mainland China have rapidly improved their technology and continuously engaged in price competition, which has had a considerable impact on product prices.

C. The industry is becoming increasingly competitive, and the strong competition from small and medium-sized network communication companies in mainland China has led to a gradual compression of gross profit margins.

D. There is a shortage of software talent in Taiwan's network communication industry.

E. Smartphones have reached saturation, the replacement cycle for consumers is longer, the unit price is polarized, the business risks have increased, and competition is fierce, with low and difficult-to-improve profit margins.

-78-

-79-

(3). Strategies

A. Create product differentiation services to avoid price-cutting and red ocean competition strategies.
B. Offer a variety of products, expand revenue, and use detailed operational analysis to calculate the cost structure of each product to reduce operating costs. Use low-cost advantages to expand market share and maintain steady profitability.
C. Actively develop diversified cloud-based intelligent Internet of Things (IoT) integrated application service products and platforms to increase customer adoption opportunities and accelerate market maturity.
D. Precisely segment the market's user/enterprise needs and develop diversified network application services tailored to the target customer group's requirements.
E. Actively layout the 5G market, develop 5G-related products, and gain a market advantage.
F. Continual refinement and optimization of ESG-Ready module solutions, providing a more comprehensive and complete offering to assist clients in establishing ESG capabilities.
G. Identification and cultivation of business opportunities in energy conservation, carbon reduction, digital assets, and carbon credit trading for long-term development.

(2) Important Uses and Manufacturing Processes of Main Products

Important Uses of Main Products

(1). Important uses of broadband communication products:

Product Category	Use
Fiber-optic network access equipment	Used for receiving high-speed data transmission through the technology of optical-electric conversion in fiber-optic networks.
4G VoLTE gateway	A home device that integrates mobile data, voice, and wireless functions to provide various value-added applications.
LTE small base station	A small mobile network edge device that provides mobile users with voice calling and mobile internet access, among other uses.

(2). PBX Business Telephone Systems

Currently, companies around the world generally have their own telephone systems, collectively known as "customer premise equipment" (CPE). Depending on the size of the system, it can be classified as either an "electronic switchboard" or a "business phone system", with the latter accounting for approximately 80% of the CPE market. These systems not only meet the external communication needs of users, but also satisfy the internal communication needs of enterprises through various special functions, such as call forwarding, intercom, and conferencing. As the global proliferation of the Internet and mobile communications continues to increase, the demand for multi-network services is growing. The Company provides a multi-functional platform system that combines voice, data, network monitoring, and mobile communications, and offers a new generation of super IP-based integrated business phone systems that integrate traditional phone lines, network phones, and gateways, in order to meet the world trend of IP network communication. Our product line is complete, including various capacities of digital, analog, and network-integrated exchange systems.

The new generation of telecommunications is rapidly emerging through cloud technology and mature environments, and can provide new and diverse value-added functions and telecommunications services. Currently, internet phone systems have been recognized as one of the three major voice-over-IP (VoIP) systems, along with fixed-line phone systems and mobile phone systems. In response to the rapid growth of smartphones and tablets, The Company has developed a new generation of communication systems that combine network switches (IP-PBX, expandable up to 1000 lines), network phones, smartphone apps, a smartphone business communication system, and a cloud-based mobile switchboard system, in order to fully develop the market for small and medium-sized enterprises.

(3). e-Home Smart Home System

In recent years, spurred by the wave of mobile and digital technologies and the growth of smart connected environments, consumers' demand for smart home systems has gradually taken shape, expanding from initial needs for access control, intercoms, and security alerts to encompass energy management, home automation, health care, and integration with mobile communication devices, forming four major areas of interest.

To increase our competitiveness in the smart home system market and distance ourselves from competitors, The Company has launched the world's leading all-network e-Home smart home system. This system offers monitoring systems, network services, access control systems, video intercom, intelligent control, and a smart mobile phone app, providing modern homes with more convenient living solutions. We aim to become a leading player in this market and have achieved significant success in the domestic and Chinese real estate markets. In response to the widespread adoption of cloud-based video services, we have also added a cloud-based smart video doorbell product, providing an additional layer of security protection for household users.

In October 2019, our smart home system product received certification from the "Taiwan Smart Building Association" and was awarded the "Smart Building Material Label." This certification is a positive recognition of our product's functionality and quality, and provides a clear competitive advantage for bidding on government-led "social housing" projects.

To meet the changing needs of the market, The Company has invested more resources in research and development of "smart building planning and design" in 2022. Our product integrates the eight major indicators of smart buildings and incorporates the development of indoor intercoms, resulting in the creation of our flagship product, the "TECOM Smart Home Platform IBMS." The "TECOM Smart Home Platform IBMS" has seven key features: (1) integration of access control and central monitoring systems onto the same platform, eliminating the need to manage each subsystem separately; (2) intuitive and easy-to-understand dashboard design management pages; (3) easy maintenance without requiring the purchase of multiple host computers or software; (4) modular design, high expandability, and high flexibility to suit various projects; (5) compliance with the information security environment for smart building certification levels; (6) integration of AI algorithms to improve building energy efficiency; and (7) easy upgrades for smart buildings, without the need for system integration.

(4). Fusion Access System

Whether it is internal communication within The Company or external business negotiations, it has become the norm for employees to use personal mobile devices as communication tools. Therefore, having a highly efficient and secure network environment is crucial for companies. In view of this, TECOM Company has developed a solution specifically for small and medium-sized enterprises, launching the Fusion Access System for enterprise use. This system allows companies to centrally manage network access devices, enabling employees to access internal data anytime and anywhere, and ensuring uninterrupted service to improve work efficiency. TECOM's Fusion Access System combines mobile intranet and existing fixed broadband networks, providing small and medium-sized enterprises with low-cost mobile internet access, secure internal data access, and network application services.

The system is composed of Fusion Gateway and Fusion Mobile, and companies only need to add a Fusion Gateway and connect it to the corporate network. Field employees can then access the internet through the existing broadband network, significantly reducing overall mobile internet expenses for The Company.

(5). Cloud-based Smart Electromechanical Health Management IoT System (MHm-P) for Industry 4.0

In recent years, the smart factory system has been flourishing. The Company has developed the cloud-based Smart Electromechanical Health Management IoT System (MHm-P) using IoT, mobile communication, and big data technologies, which is rated as Industry 4.0. This system can provide management and scheduling of the health status of all factory machines (production and administrative) to equipment managers. The system enables equipment managers to monitor the operation status, trends, and health conditions of the factory machines from anywhere, ensuring that all working machines are in optimal condition, maintenance is performed timely, quickly, and accurately, and preventive maintenance recommendations can be made.

The electromechanical health management system enables factory operators to fully grasp the health status of all electromechanical equipment in the factory, with multiple benefits:

Trend notifications can prompt preventive maintenance to prevent unexpected downtime and significantly reduce the occurrence of no-warning shutdowns. Timely repairs and inspections will also extend machine life and reduce replacements.
Ensure that working machines are in the best condition and maintain the highest productivity.
The remote shutdown function can prevent large-scale disasters such as machine burning, replacing repairs with small fixes, saving money, manpower, and materials.

-80-

The interactive diagnostic function is innovative and practical, saving time and manpower in repair inspections.
The platform can provide the power consumption of each electromechanical equipment, which is essential for factory energy management and analysis. It not only prevents energy waste but also calculates the energy consumption of each product, making production cost calculation more accurate.

(6). The Next-Generation Factory Unmanned Inspection System

The Company has developed a new product, the "unmanned inspection" solution for factories, which can provide many benefits for factory owners:

The unmanned inspection operation, measurement, and recording are fully automatic, ensuring accurate data acquisition.
No need for human mobility.
Simply install intelligent sensors on equipment, and sync once per set time across the entire factory, with results displayed through indicator lights on dashboards, mobile devices, or control room screens, making it easy to understand.
If the number of factory equipment reaches 500 or 1,000, this solution can provide comprehensive health data for all 500 or 1,000 machines every time it syncs, which is beyond what manual operation can achieve.
The unmanned inspection can eliminate the risk of personnel injury in locations where safety concerns are high. According to statistics, the average cost of work-related injuries exceeds 1 million for each incident. The use of unmanned measurement in dangerous areas such as rooftops can bring significant benefits to both productivity and human safety. The Next-Generation Factory Unmanned Inspection System is a new technology that replaces the traditional work mode, which is in line with the "factory improvement" defined by Industry 4.0, and can immediately upgrade factory operations.

(7). Portable Vibration Diagnostic Instrument (PVDI) for Industry 4.0

The TECOM Group is a leading company in the electromechanical field and has many years of experience in vibration measurement and maintenance operations. They deeply understand the difficulties of vibration maintenance and have specially designed a series of portable vibration diagnostic instruments (Pro-3200 / Pro-3600 / Pro-9000P) to meet the needs of vibration maintenance.

A. Pro-3200/3600 Vibration Diagnostic Instrument:

The Pro-3200/3600 portable box includes an IoT gateway, a smart vibration sensor, and a mobile power supply, which can be carried by maintenance technicians to the site to diagnose the vibration information of electromechanical equipment in real time.

This diagnostic instrument uses MEMS and IoT new generation technology, combined with the application of the patented "Interactive Diagnosis", which is currently leading the world. The vibration sensor is connected to the IoT gateway and smart phone, executing interactive measurement. This diagnostic instrument has powerful interactive and analysis capabilities, as well as new generation IoT functions, which will significantly improve the efficiency of on-site maintenance measurements and save manpower and time.

Pro-3200 can be said to be the "black technology tool" for routine inspection of factory electromechanical equipment. The vibration operation of the equipment can be fully automatically measured, and the measurement results are automatically stored and filed. When all the equipment in the factory is measured, the factory has successfully established a "full equipment vibration operation database". This database is not insignificant and can be used for big data analysis and comparative diagnosis.

There are many types of electromechanical equipment in the factory. We provide key measurement points for the most common types of equipment (wind, pumps, gearboxes, motors, etc.), and the inspection personnel can place the vibration sensor attached to Pro-3200 at each key point. Vibration measurement is fully automatic, and each equipment should be measured within 10 minutes and the file is established. This vibration diagnostic instrument can bring the following benefits to the factory maintenance personnel:

Routine inspection and automatic testing
Automatic archiving and establishment of vibration database
Big data analysis and comparative diagnosis
Upgrade to an Industry 4.0 intelligent manufacturing project vendor.

B. Pro-9000P Vibration Diagnostic Instrument:

The Pro-9000P is a professional-grade portable vibration diagnostic instrument that is suitable for measuring, analyzing, and diagnosing vibrations in all types of rotating machinery. Users can easily detect equipment vibration problems through simple installation and operation on a tablet computer provided in the kit. This tool can significantly improve maintenance operations and is a must-have for factories, manufacturers, dealers, and maintenance technicians.

This vibration diagnostic instrument is powerful and has the following main features:

Real-time data acquisition, health analysis, and fault diagnosis capabilities
Real-time display of waveform (time-frequency) of the original vibration value
Real-time display of spectrum graphs, including acceleration FFT, velocity FFT, envelope spectrum, etc.
With the measured data, users can scale the spectrum graph to view detailed information
Provides a real-time monitoring health indicator (or confidence indicator) that converts to an overall health score ranging from 0 to 1, with 1 representing perfect health, and conforms to the spirit of ISO-10816
The provided real-time health indicators include the health indicator (or CV), velocity RMS value (or Vrms), and acceleration RMS (or Grms)
Can switch to trend mode to view the trend of health indicators, including the health indicator (or CV), velocity RMS value (or Vrms), and acceleration RMS (or Grms)
Displays a health trend chart based on the latest 100 data records
Can display at least two channels of information at once
Provides diagnostic information and continuously evaluates whether the target mechanical equipment has potential fault problems, with the evaluation result displayed in this area
The diagnostic information should include at least the following diagnostic items:
Spindle type: imbalance, shaft bending, misalignment, looseness
Bearing type: oil whirl, oil whip, inner ring damage, outer ring damage, ball damage
Gear type: gear eccentricity, gear misalignment, gear tooth breakage, gear wear, gear shaft bending
Electrical type: uneven air gap, rotor bar breakage, phase problem
Provides predictive analysis function, which can perform predictive analysis through database data and algorithms.

C. Pro-9900 Fully Automatic Vibration Diagnostic Instrument

The Pro-9900 is an advanced upgrade of the Pro-9000P, which provides intuitive health status (CV), predictive maintenance schedules, diagnostic results, and recommended strategies based on existing real-time spectrum displays, health status (CV), and diagnostic data. The Pro-9900 is a fully automatic professional diagnostic instrument that can be used without the presence of vibration experts, and is combined with TECOM's routine/high-end unmanned patrol and real-time monitoring solutions. It provides measurement and recording tools for maintenance personnel to perform measurements and records before and after maintenance, as well as verification and acceptance tools for comparison. In this way, the intelligent product can form a complete "closed-loop service." The Pro-9900 offers two operating modes: automatic mode and expert mode:

Automatic mode:

General users only need to enter basic equipment parameters, and the Pro-9900 can automatically output health status (CV), vibration data, and diagnostic data. The Pro-9900 can directly output diagnostic reports or acceptance reports in the form of predictive maintenance schedules, diagnostic results, and recommended strategies based on health status (CV) and diagnostic data.

Expert mode:

When the user is an expert, the Pro-9900 can be used in expert mode to review diagnostic spectra and data on a case-by-case basis, and can capture screenshots to create the necessary expert analysis reports.

After the measurement is completed, the Pro-9900 displays the diagnostic results and recommended strategies in simple and understandable language for everyone to understand.

D. Pro-6800 Portable Smart Motor Health Inspector

The Pro-6800 is designed for inspecting the operating status of factory motors—an essential task in industrial operations. Traditional manual methods of measurement and recording often fall short in accurately assessing motor health. In contrast, Tong Hsing's Smart Motor Health Inspector leverages

-82-

next-generation IoT technology with seamless cloud-to-local integration, delivering highly intelligent health management. It significantly upgrades traditional manual inspection processes, offering both superior performance and affordability, making it an indispensable tool for factory maintenance teams.

Key Advantages Over Traditional Inspection Tools:

In addition to measuring RMS vibration levels, the device also collects raw vibration data, enabling in-depth analysis and diagnostics to pinpoint the root cause of issues.
By using machine learning (ML) and artificial intelligence (AI) algorithms, the system can calculate motor health indices and suggest predictive maintenance schedules after collecting as few as 30 data points.
The proprietary app automatically analyzes raw vibration data to determine if the motor system has excessive power consumption issues, backed by an invention patent.
Within 2 to 4 weeks, the system can identify motors showing signs of health degradation or energy inefficiency, enabling timely repair or replacement.
All inspection data is uploaded to a back-end management platform that offers powerful features such as command center dashboards, real-time alerts, centralized database, trend analysis, anomaly detection, records, and customizable reports.

(8). Next Generation Vibration Meter Series

The TECOM Next Generation Vibration Meter Series features a new generation microelectromechanical system (MEMS) chip that integrates a sensor and a signal processor into one device. It also uses top-of-the-line 316L stainless steel gauge bodies and gauge seats, making it the most feature-rich vibration meter on the market today. With low noise density, high measurement bandwidth, and high resolution, it is suitable for measuring spindles and servo motors.

To meet the various application requirements of the industrial sector, the vibration signal can be output in multiple ways, providing a variety of vibration meters:

VB-300 Series: Three-axis Vibration Meter
VB-310: Three-axis vibration sensor, RS-485, Modbus, Raw data, 105°C
VT-315: Three-axis vibration temperature integrated sensor, RS-485, Modbus, Raw data, 105°C
VB-320SCB: Ultra-thin three-axis vibration sensor, RS-485, Modbus, Raw data
VB-451SCB: 0-5V analog, 85°C
VB-330: Three-axis high-frequency vibration sensor, RS-485, Modbus, Raw data, 105°C
VB-420HT: MEMS, 4-20ma, 105°C
VB-100: Smart Self-contained Screen Vibration Meter
VBD-120: Vibration Display Screen
VB-700: MEMS IEPE Vibration Meter
VB-800: Bluetooth Wireless Vibration Temperature Meter
VB-168: Bluetooth Wireless Vibration Temperature Meter
VB-800EX: Bluetooth Wireless Explosion-proof Vibration Temperature Meter
VB-168EX: Bluetooth Wireless Explosion-proof Vibration Temperature Meter
VB-168EX: Bluetooth wireless explosion-proof vibration temperature sensor
VB-800ML: Bluetooth wireless vibration temperature sensor, capable of edge computing: machine learning and artificial intelligence

The VB-800ML wireless (Bluetooth) vibration sensor is capable of estimating excessive power consumption and carbon emissions resulting from motor degradation. It features a built-in microprocessor for edge computing, machine learning, and artificial intelligence capabilities. The VB-800ML can directly interface with a mobile app without the need for a gateway device, allowing for direct retrieval of measurement data. It operates on battery power (replaceable) for up to three years and requires simple installation without the need for power or network cables or any specific network environment. The mobile app enables users to monitor the motor's operational health and the energy and carbon wastage resulting from degradation.

These two pieces of information, energy wastage and carbon wastage, are critical data that assist users in making timely and accurate decisions regarding motor maintenance, adjustments, or replacements.

-83-

Estimating energy wastage and converting it into monetary value provides users with a direct and tangible reminder, making it a significant innovation.
Converting the monetary value into excessive carbon emissions in kilograms offers quantifiable emission reduction measures, supporting corporate carbon neutrality and the implementation of ESG policies.

(9). CEm Energy Efficiency and Consumption Management System

In response to the requirements of the Industrial Development Bureau, Ministry of Economic Affairs, regarding energy efficiency declaration for high-energy-consuming chiller and compressed air systems in factories:

All factories are required to install necessary devices for hourly measurement and recording during the year 2022. Starting from the year 2023, they must declare the energy efficiency of chiller and compressed air systems for the previous year.

To meet the requirements of the Energy Bureau, TECOM has introduced the CEm Electrical and Mechanical Equipment Energy Consumption and Efficiency Management System, which helps factories comply with energy reporting and achieve cost savings. The system has the following features:

TECOM's "CEm Energy Efficiency and Consumption Management System" utilizes new technologies such as smart sensors, cloud platforms, artificial intelligence, and machine learning to significantly enhance the "manual inspection" process of factory energy consumption and efficiency, saving labor hours.
Uniquely in the market, the system employs AI/ML calculations to determine energy consumption (Cx) and efficiency (Ex) indices, enabling early maintenance of equipment and substantial savings in electricity costs.
The system provides multiple differentiated functions, such as data interruption retransmission and direct connection between mobile phones and on-site gateways, ensuring no data loss and offering expert-level control.
While the Energy Bureau's requirements focus on energy consumption and efficiency measurement and reporting, our Cx and Ex indices encourage property owners to improve the operational efficiency of their equipment, reduce inefficient electricity consumption, and conserve national power resources. This aligns with the deeper expectations of the Energy Bureau.
The system serves as an important indicator for factory ESG (Environmental, Social, and Governance) and facilitates the concrete implementation of ESG strategies in factories.

(10). MHEW (Machine Health & Electricity Waste management) refers to the management of motor health and electricity waste.

TECOM introduces the VB-800ML (KinBaoBiao) Vibration Measurement Gauge, which utilizes advanced vibration technology to estimate the electricity consumption percentage of motor systems (motor + load). This platform assists factory managers in controlling electricity consumption, providing a novel approach to achieve energy savings and reduce "hidden costs" in factories. The Motor Dual-Protection Consumption Management Platform offers specific energy-saving and emission-reduction functionalities:

Aging and deterioration of motor equipment lead to hidden electricity consumption and carbon waste, posing obstacles to the implementation of ESG policies.
TECOM's Motor Dual-Protection Consumption Management solution utilizes vibration technology to estimate the electricity consumption percentage of motors. This prompts factories to expedite maintenance and reduce electricity cost losses.
The electricity consumption percentage can be converted into excess carbon emissions in kilograms, providing a unique "quantitative" carbon reduction method that brings tangible benefits to ESG emission reduction initiatives and can potentially reduce carbon taxes.
By saving on electricity costs and reducing waste heat emissions, this platform offers dual benefits to both the company and the environment.

-84-

(11). CNm (Carbon Neutral Management) Platform:

TECOM offers a digital greenhouse gas inventory tool to assist enterprises in digitizing inventory, generating lists, and smoothly obtaining verification statements. However, to progressively reduce carbon emissions annually, companies need a carbon management mechanism. TECOM's CNm platform provides powerful, advanced, and user-friendly carbon management. The digital inventory tools seamlessly integrate into the CNm platform, allowing companies to immediately commence carbon management. Carbon management features include:

Situation room for visual information
Remote online review
Emission density trends
Identification and monitoring of hotspots
Setting emission reduction targets and monitoring completion
Excess emission alerts
IoT mobile APP
Emission prediction mechanism

(12). EMS (Energy Management System) – Electricity Management

In an era of rising electricity prices, how enterprises can enhance energy efficiency, reduce energy consumption costs, and manage greenhouse gas emissions has become a crucial issue in pursuing sustainable development. The International Organization for Standardization (ISO) has established a systematic framework for energy management—ISO 50001, an international standard that guides organizations in improving energy performance, including energy efficiency, use, and consumption. Through a structured management approach, ISO 50001 aims to reduce GHG emissions, mitigate environmental impacts, enhance energy efficiency, and lower energy costs. TECOM's ESG Management Platform – EMS Electricity Management Module is designed in full compliance with the ISO 50001 standard. It not only provides real-time energy measurement and analysis, but also includes features such as energy performance indicator (EnPI) management and energy baseline (EnB) establishment, assisting enterprises in obtaining ISO 50001 certification.

Key Features of the EMS Electricity Management Module:

Real-time data acquisition and analysis of energy usage.
Identification of key energy-consuming areas to prioritize efficiency improvements.
Set and manage energy baselines as reference points for performance comparison.
Track and compare short- and long-term energy consumption performance.
Tools for monitoring patterns, generating alerts, and diagnosing anomalies.
Automatically generate certification-ready documentation aligned with ISO 50001.
Integration of the ISO 14064 Carbon Inventory System
Integration of ISO 14067 Product Carbon Footprint Management
Remote control for chillers, air compressors, and equipment
Integration of green power generation systems
Integration of energy storage systems
Integration of lighting systems
Integration of machine learning to provide AI-based energy-saving control

-85-

2. Manufacturing Processes

(3) Major Raw Materials' Status of Supply

Major Raw Materials	Main Source	Status of Supply
IC and electronic components	Domestic and foreign suppliers	Good
Printed circuit board	Domestic suppliers	Good
Plastic components	Domestic suppliers	Good
Optical fibers	Domestic and foreign suppliers	Good

(4) The names of customers that accounted for more than 10% of total sales or purchases in any of the past two years, along with their sales or purchase amounts and percentages, and an explanation of the reasons for any changes in their levels

The names of suppliers that accounted for more than 10% of total purchases:

Unit: in thousand (NT$)

	Year 2024				Year 2025
Item	Name	Amount	Percentage of annual net sales (%)	Relationship with the issuer	Name	Amount	Percentage of annual net sales (%)	Relationship with the issuer
1	A	62,650	20.52		A	57,891	15.28	None
2	Others	242,626	79.48		Others	320,899	84.72
	Export	305,276	100		Export	378,790	100

Note: Due to different product sales combinations in each year, the amount of raw material costs may vary.

Customers accounting for over 10% of total sales:

Unit: in thousand (NT$)

	Year 2024				Year 2025
Item	Name	Amount	Percentage of annual net sales (%)	Item	Name	Amount	Percentage of annual net sales (%)	Item
1	A	67,022	10.6	None	A	165,485	22.59	None
2	Others	564,392	89.4		Others	567,023	77.41
	Net sales amount	631,414	100		Net sales amount	732,508	100

Note: Due to different product sales combinations in each year, the amount of sales may vary.

Employee Information for the Last Two Years and as of the Publication Date of this Annual Report.

Year		Year 2024	Year 2025	As of March 31, 2026
Number of Employees	Direct Employees	19	13	13
	Indirect Employees	131	117	114
	Total	150	130	127
Average Age		50.00	50.77	51.51
Average Length of Service		13.56	13.47	13.60
Educational attainment distribution ratio	Master's Degree or Above	21.33%	23.03%	22.83%
	College Degree	64%	63.21%	62.99%
	High School Diploma	11.33%	12.31%	11.81%
	Below High School	3.33%	2.31%	2.26%

-88-

4. Environmental Expenditure Information

(1) The total amount of losses (including compensation) and disposals due to environmental pollution incurred during the current fiscal year and up until the date of publication of the annual report: None

The Company does not generate significant pollutants during the manufacturing process, and we have not experienced any environmental losses due to pollution in the past two years. Additionally, we allocate a certain percentage of our monthly water bill to the Science Park Administration to facilitate their coordination of environmental protection matters.

(2) Explanation of future strategies (including improvement measures) and potential expenses:

Continued efforts have been made to conduct environmental protection and occupational health and safety inspections, identifying and improving unsafe conditions within the premises. Regular training sessions on environmental protection and occupational health and safety have been conducted, along with emergency response drills and monitoring of the work environment. Employee health check-ups are conducted every two years, and on-site nursing personnel conduct monthly health evaluations for employees. These measures have effectively reduced workplace hazards and risks, preventing occupational accidents from occurring.

(3) Measures to protect the working environment and employees' personal safety:

Establishment of specialized units for occupational safety and health and environmental protection:

In accordance with the "Regulations for the Management of Occupational Safety and Health," specialized units and occupational safety and health committees have been established, and the occupational safety and health committee is regularly convened every quarter to review and assess the effectiveness of continuous improvement, with the goal of achieving a zero-accident workplace. In terms of environmental management, executing and reporting on environmental management related operations in compliance with the law, implementing resource recycling and reuse operations.

Regular environmental protection and occupational safety and health education and training:

New and existing employees are provided with occupational safety and health education and training in accordance with regulatory requirements. Employees who handle organic solvents or waste are required to attend education and training courses. Employees who operate dangerous machinery or equipment must be trained and licensed before being allowed to operate them, such as forklifts and X-rays. Regular refresher training is also provided to enhance employee awareness of safety and environmental protection.

Workplace safety:

An automatic inspection plan is established in accordance with occupational safety and health regulations to conduct various operation checks on a daily, weekly, monthly, quarterly, semi-annual, and annual basis.

Operation environment monitoring:

In accordance with the "Implementation Measures for Occupational Environmental Monitoring," chemical factor operation environment monitoring is conducted every six months, including monitoring of carbon dioxide and organic solvents. Local exhaust equipment and lighting and illumination are inspected annually, and qualified operation environment monitoring agencies are commissioned to conduct regular monitoring in accordance with legal requirements. Currently, YuDa Technology Consulting Co., Ltd. is responsible for operation environment monitoring, and the results from 2024 to 2025 years are all qualified, to ensure that the workplace meets regulatory requirements and protects the health of employees.

Regularly conducting fire emergency response education and training:

Emergency response training is conducted every six months in accordance with regulatory requirements, and emergency response team members provide education and training for seed learners in each department.

Health care and management:

The health of employees is The Company's greatest asset. The Company also implements health checks for general and special hazardous operations in accordance with the "Regulations for Health Protection of Workers," publishes health information, promotes health promotion activities, and provides on-site nursing staff and doctors to provide health education services and health information for employees, continuously promoting employee self-health management and providing a safe and comfortable working environment.

-89-

-90-

5. Labor Relations

(1) Employee benefits, education and training, retirement system, and the implementation of agreements and measures for employee rights protection:

Employee Welfare Measures:
The Company values employee compensation and welfare, actively cultivates talent, complies with labor laws and regulations, and safeguards employee rights and interests. In addition to enrolling employees in National Health Insurance and Labor Insurance as required by law, the Company has also established an Employee Welfare Committee to administer employee welfare matters. Welfare funds are allocated monthly, and through a comprehensive welfare system, the Company helps stabilize employees' lives while fostering relationships of mutual trust and reliance. Major welfare measures include:
(1) Annual health examinations
(2) Flexible working hours
(3) Long-service employee recognition
(4) Marriage, funeral, and celebration subsidies
(5) Discounts at partner merchants
(6) Illness and emergency assistance
Employee Education and Training:
The Company is people-oriented and, based on the principles of personal growth and corporate development, plans comprehensive education and training programs. A complete training system is provided through annual training plans, including internal training courses and external programs organized by professional institutions, enabling employees to continuously acquire updated professional skills and enhance their expertise.
Retirement System and Implementation:
To ensure a stable retirement life for employees and enhance service morale, the Company contributes retirement funds in accordance with applicable laws:
(1) In accordance with the Labor Standards Act, the Company has established a Pension Reserve Supervisory Committee and makes monthly contributions to a pension reserve account with the Bank of Taiwan. The Company also formulates and implements labor retirement regulations in compliance with relevant requirements.
(2) In accordance with the Labor Pension Act, the employer contributes 6% of each employee's monthly salary to the employee's individual pension account with the Bureau of Labor Insurance.
Measures for Protecting Employee Rights and Interests:
The Company maintains harmonious labor-management relations. All policies and measures are implemented in accordance with relevant laws and regulations, with satisfactory results. Any new or revised labor-management measures are finalized only after full consultation and communication between labor and management; therefore, no disputes or conflicts have arisen. The Company has established an Employee Welfare Committee, implemented a retirement system, encouraged employees to participate in various training programs, provided Labor Insurance, National Health Insurance, and group insurance, and arranged regular health examinations to care for employees' physical and mental well-being and protect their rightful interests.
Agreements Between Labor and Management:
Any new or revised labor-management measures are finalized only after full consultation and communication between labor and management. As a result, no disputes or conflicts have occurred.
(2) List the losses suffered in the recent year and up to the date of publication of the

annual report due to labor disputes, and disclose the estimated amount and response measures for current and future possible occurrences, if any: None.

6. Information Security Management

(1) Describe the framework for managing information security risks, the information security policy, specific management plans, and resources invested in information security management:

Information Security Management Framework: To ensure information security and protect the interests of The Company and stakeholders, the General Manager serves as the overall person in charge of information security operations and oversees information security policies and governance-related matters. A "Information Security Processing Team" has been established, composed of representatives from the Information Department and various departments, to carry out relevant information security work.
Information Security Policy: In accordance with the "Guidelines for Public Companies to Establish Internal Control Systems" Article 9, The Company has formulated regulations on computer information security.
Specific Management Plans: The "Information Technology Committee" is held annually to review and promote information security and information protection policies and guidelines, and to ensure the effectiveness of information security management measures.
Resources Invested in Information Security Management: Due to the constant emergence of new methods of cybercrime and frequent incidents of network and ransomware attacks in recent years, The Company has deployed corresponding information security equipment and personnel to respond to such threats. In the future, The Company will continue to strengthen its investment in information security.

(2) Disclosure of Losses, Potential Impact, and Response Measures due to Significant Cybersecurity Incidents in the Current and Previous Fiscal Year up to the Date of Publication of the Annual Report, and an Explanation of the Inability to Reasonably Estimate If Applicable: None

-91-

7. Important Contracts

Contract Type	Parties involved	Contract Start and Ending Dates	Major Content	Restrictive clauses
Land lease agreement	Science Industrial Park Administration	01.20.2008~12.31.2027	Leasing of factory premises and land from the administration	Restricted to use for specific business purposes.
Credit agreement	CTBC Bank	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	Mega International Commercial Bank	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	E.SUN BANK	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	Taiwan Cooperative Bank	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	UNION BANK OF TAIWAN	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	Hua Nan Bank	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Credit agreement	Baycom Opto-electronics Technology co., ltd.	05.23.2025~05.23.2028	Enhance operating capital and strengthen financial structure	Improve financial structure and increase short-term debt repayment ability.
Factory Lease Contracts	Wistron Corporation	1.1.2023-12.31.2027	Factory Lease	Restricted to use for specific business purposes.
Factory Lease Contracts	Wistron Corporation	9.1.2023-4.30.2026	Factory Lease	Restricted to use for specific business purposes.
Procurement contract	TECO Electric & Machinery Co., Ltd and other companies	The contract period is one year, but if either party fails to provide written notice to the other party of termination or renegotiation before 30 days prior to the expiration date, the contract will be automatically extended for one year. The same conditions apply for subsequent extensions.	Regulations on rights and obligations regarding manufacturing and supplying materials	None
Distribution agreement	SONGYU (SY) Technology CO., LTD. and other companies	The contract period is one year, but either party may renew the contract under the same conditions with the mutual agreement of both parties, provided that the request for renewal is made three months prior to the expiration date.	Regulations on rights and obligations regarding the sale and purchase of products such as smart home systems, centralized user exchange equipment, user-side exchange systems, smart mobile communication systems, and wireless communication devices.	None

-92-

V. Review and Analysis of Financial Status and Business Results and Risk Issue

1. Financial Status

Unit: in thousand (NT$)

| Year
Item | Year 2025 | Year 2024 | Difference | |
| --- | --- | --- | --- | --- |
| | | | Amount | % |
| Current assets | 641,162 | 656,666 | (15,504) | (2.36) |
| Non-current assets | 584,711 | 636,170 | (51,459) | (8.09) |
| Total assets | 1,225,873 | 1,292,836 | (66,963) | (5.18) |
| Current liabilities | 398,879 | 646,008 | (247,129) | (38.25) |
| Non-current liabilities | 382,835 | 205,749 | 177,086 | 86.07 |
| Total liabilities | 781,714 | 851,757 | (70,043) | (8.22) |
| Share Capital | 302,719 | 302,719 | 0 | 0.00 |
| Capital reserve | 0 | 6,237 | (6,237) | (100.00) |
| Retained earnings | (137,169) | (106,875) | (30,294) | (28.35) |
| Other interests | 27,112 | 11,027 | 16,085 | 145.87 |
| Treasury shares | 0 | (13,812) | 13,812 | 100.00 |
| Interests attributable to parent | 192,662 | 199,296 | (6,634) | (3.33) |
| Non-controlling interests | 251,497 | 241,783 | 9,714 | 4.02 |
| Total equity | 444,159 | 441,079 | 3,080 | 0.70 |
| Explanation of Changes | | | | |
| 1. Decrease in Assets: Mainly due to the repayment of liabilities. | | | | |
| 2. Decrease in Liabilities: Mainly due to the repayment of liabilities. | | | | |
| 3. Increase in Equity: Mainly due to increased profits of subsidiaries, which raised total equity and resulted in higher non-controlling interests compared with the previous year. | | | | |

-94-

2. Financial Performance

Unit: in thousand (NT$)

| Year
Item | Year 2025 | Year 2024 | Increase (Decrease)
Amount | Changes Ratio% |
| --- | --- | --- | --- | --- |
| Operating Revenue | 732,508 | 631,414 | 101,094 | 16.01 |
| Operating costs | 511,870 | 440,595 | 71,275 | 16.18 |
| Gross Profit | 220,638 | 190,819 | 29,819 | 15.63 |
| Non-operating income and expenses | 816 | 5,471 | (4,655) | (85.08) |
| Profit Before Income Tax | (5,374) | (16,963) | 11,589 | 68.32 |
| Current income tax expense | (245) | 115 | (360) | (313.04) |
| Net income (Loss) for the period | (5,619) | (16,848) | 11,229 | 66.65 |
| Comprehensive Income (Loss) for the period | (2,401) | (8,477) | 6,076 | 71.68 |
| 1. Analysis of Changes in Income and Expenditure:
1. Increase in Gross Profit: Mainly attributable to increased demand for export orders of indoor optical fiber cables and higher sales of externally sourced products, resulting in higher operating revenue and gross profit compared with the previous year.
2. Net Profit (Loss) for the Period: Although operating revenue and gross profit increased compared with the previous year, net loss was recorded for the current year due to a decrease in non-operating income.
3. Total Comprehensive Income (Loss) for the Period: The extent of losses narrowed during the current year, and the market value of investment targets declined slightly compared with the same period of the previous year; accordingly, total comprehensive income for the current period still increased compared with the same period of the previous year.
2. Expected sales volume and basis, possible effect on the company's finance and business in the future, and counter plan:
Given the industrial environment and supply and demand on the market, plus business development, status of orders reception, and recent operating status, revenues of various business items are expected to keep growing steady in the coming one year. | | | | |

-95-

3. Cash Flow

(1) Analysis and explanation of changes in cash flow in the past years and plan for improving liquidity shortage:

Unit: in thousand(NT$)

Beginning cash balance	Net cash provided by operating activities for the year	Net cash (used in) provided by investing and financing activities for the year	Net cash (outflow) inflow for the year	Remedies for cash deficiency,
				Investment Plan	Financial Plan
225,484	(7,720)	(72,694)	(80,414)	-	-
1. Analysis of Changes in Cash Flow for the Current Year: (1) Operating Activities: Mainly due to an increase in accounts receivable during the current period, resulting in net cash outflow from operating activities. (2) Investing Activities: Mainly due to increased capital expenditures, resulting in net cash outflow from investing activities. (3) Financing Activities: Mainly due to the repayment of bank borrowings, resulting in net cash outflow from financing activities. 2. Remedial Measures for Insufficient Cash and Liquidity Analysis: (1) Remedial Measures for Insufficient Cash: Not applicable.
Year
Item	Year 2024	Year 2023	Increase (Decrease) Ratio
---	---	---	---
Cash flow ratio	0	8.27	(100.00)%
Cash flow adequacy ratio	95.29	120.99	(21.24)%
Cash reinvestment ratio	0	8.61	(100.00)%
Analysis of changes in percentage:
The increase in the cash flow adequacy ratio was primarily due to the growth in net cash flows from operating activities over the past five years.

(2) Analysis of Cash Liquidity for the Next Year

Operating activities: It is expected that the domestic and international economic situation will gradually recover. However, the global consumer market is still uncertain, and business operations still need to be evaluated cautiously. Nevertheless, new business opportunities created by new market changes and continued control of various expenditures are expected to result in net cash inflows from operating activities.
Investing activities: Non-core investment projects will continue to be reviewed, and if necessary, appropriate disposal will be made to inject funds into core business investments. It is expected that investing activities will result in net cash inflows.
Financing activities: Continuously use cash inflows from core business and self-owned funds to expand core business and repay loans. It is expected that financing activities will result in net cash outflows.

Impact of Major Capital Expenditure in the Past Year on the Financial: None
Re-investment Policy in the Past Year, the Main Reason for Its Profit or Loss, the Improvement Plan and Investment Plan in the Next Year:

(1) Re-investment Policy in the Past Year:
The Company's re-investment policy has always focused on investing in the communication-related industry to complement our core business.

(2) the Main Reason for Its Profit or Loss, the Improvement Plan:
In the future, we will continue to strive for the growth of our core business, and the re-investment policy will focus on upstream and downstream integration in line with product trends. The Company will continue to supervise and assist its subsidiaries to accelerate the improvement of profitability. In the future, we will also adjust our product strategy in a timely manner to enhance investment efficiency in response to the overall market trends.

(3) Investment Plan in the Next Year:
In the next year, our re-investment policy will adopt more rigorous evaluation criteria to create the greatest benefit for our shareholders.

Review and Analysis of Risk Issues in the Past Year and as of the Date of Publication of the Annual Report
Impact of Interest Rate Fluctuations on the Company's Profit/Loss and Future Countermeasures
In fiscal year 2025, the Company's financial costs amounted to NT$15,365 thousand, primarily consisting of interest expenses on bank loans, representing 2.1% of the annual operating revenue. Adhering to the principles of safety and prudence, the Company will continue to monitor interest rate trends and, under the premise of improving its financial structure and mitigating interest rate risks, will carefully determine financing methods to secure more favorable rates and reduce potential operational risks arising from interest rate fluctuations.
Impact of Exchange Rate Fluctuations on the Company's Profit/Loss and Future Countermeasures
As the Company's operations are primarily focused on the domestic market, exchange rate fluctuations have minimal impact on the Company.
Impact of Inflation on the Company's Profit/Loss and Future Countermeasures
As the Company's products are not sold directly to general consumers, inflation has no immediate or direct impact on its operations. Historically, the Company's profit and loss have not been significantly affected by inflation. Going forward, the Company will continue to closely monitor market price fluctuations. Should inflation drive an increase in procurement costs, the Company will make appropriate adjustments to sales prices and maintain close oversight of supplier pricing to mitigate the potential risks of cost fluctuations on profitability.

(2) Policies related to high-risk, high-leverage investments, lending to others, endorsements and guarantees, and derivative transactions, as well as the main reasons for profit or loss and future response measures:

-96-

The Company does not engage in high-risk or high-leverage investments. With regard to lending funds to others and endorsement guarantee transactions, The Company has established related regulations such as the "Endorsement Guarantee Operation Procedure," "Funds Lending to Others Operation Procedure," and "Acquisition or Disposition of Assets Processing Procedure." Derivative financial product transactions are all used to avoid the risk of foreign currency asset and liability exchange rate fluctuations. In summary, in order to ensure asset security, The Company does not engage in high-risk behaviors, and there are no significant profits or losses.

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

The Company has detailed planning and progress tracking for the development progress, research and development expenses, expected mass production time, and achievement of goals for each research and development project. For the expected research and development expenses for the year 2025, please refer to page 69 of this annual report.

(4) Impact of important domestic and international policies and legal changes on The Company's financial business and response measures:

The Company closely monitors and understands policies and laws that may affect The Company's operations and adjusts The Company's relevant systems accordingly. During the past year and until the date of publication of this annual report, changes in relevant laws and regulations have not had a significant impact on The Company's operations.

(5) Impact of technological changes (including information security risks) and industry changes on The Company's financial business and response measures:

The Company closely monitors technological developments within its industry, keeps abreast of market trends, and evaluates their potential impact on its operations. As of the publication date of this annual report, technological changes (including information security risks) and industry shifts have not had any material impact on the Company's operations..

(6) Impact of changes in corporate image on crisis management and response measures: None.

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

(8) Expected benefits, potential risks, and response measures related to expanding the factory: None.

(9) Risks and response measures related to concentration in purchasing or sales:

The Company continues to strive towards diversifying its market customers in order to expand market share and revenue.

(10) Impact, risks, and response measures related to the transfer or replacement of the substantial shareholdings or change in ownership of The Company's directors or shareholders holding more than 10% of the shares:

There has been no large-scale transfer or replacement of shareholding by the directors or major shareholders of The Company in the past year.

(11) Impact, risks, and response measures related to changes in The Company's management rights: None.

(12) Major lawsuits or non-litigation events involving The Company, directors, general managers, substantial responsible persons, major shareholders with a shareholding exceeding 10%, and subsidiary companies that have been determined by a final judgment or are still pending and may have a significant

-97-

impact on shareholder equity or security prices. The disputed facts, subject matter amount, lawsuit commencement date, major parties involved in the litigation, and handling status as of the date of the annual report should be disclosed: None.

(13) Other significant risks and response measures:

TECOM has established an appropriate network and computer security protection system to protect its important information assets and enterprise operation systems from illegal intrusion or attacks. However, in extreme cases, it is still possible to cause potential system damage, data loss, and even production line shutdown due to malicious attacks such as hackers, Trojans, viruses, worms, network paralysis, and encryption ransomware.

TECOM cannot guarantee perfect defense against various new types of attacks and hacker tactics but will try its best to ensure the effectiveness of various security measures.

As of the end of the year of 2025 and the date of publication of the annual report, TECOM has not discovered any significant network attacks or hacker ransom events that have had or will have a significant adverse impact on The Company's business and operations, nor has it been involved in any related legal cases or regulatory investigations.

Other important matters: None

-98-

VI. Special notes

Information about The Company’s Affiliates
Please refer to the Market Observation Post System (MOPS) at https://mops.twse.com.tw > Individual Company > Electronic Document Download > Related Party Transaction Statements Section. Enter the company code to search for information related to affiliated enterprises
Private Placement of Securities in the Past Year and as of the Date of Publication of the Annual Report: Please refer to Pages 100 - 101.
Other Necessary Supplementary Notes: None
Matters in the Past Year and as of the Date of Publication of the Annual Report Which Have a Substantial Impact on Owner’s Equity as Stipulated in Item 3, Paragraph 2 of Article 36 of the Securities Exchange Law: None

-99-

2. Private Placement of Securities in the Past Year and as of the Date of Publication of the Annual Report

| Item | Private Placement of Convertible Preferred Shares in 2012
Issue date: November 1, 2012 | | | | |
| --- | --- | --- | --- | --- | --- |
| Type of private placement securities | Convertible Preferred Shares | | | | |
| Date of approval by the shareholders meeting and amount approved | Approval date: October 12, 2012 Number of shares: Up to 625,000,000 shares | | | | |
| Basis and rationality of the price setting | (1) The pricing of this private placement of convertible preferred shares was set at no less than 80% of the theoretical price. The theoretical price was calculated using an appropriate pricing model that takes into account all rights included in the offering terms. Any rights that were not taken into account in the model should be excluded from the offering terms. The actual pricing and date of the private placement shall be authorized by the Board of Directors within the range of the percentage approved by the shareholders' meeting in the future based on specific circumstances.

(2) In accordance with the Securities Exchange Law and the "Notes for Public Companies Conducting Private Placement of Securities," the pricing of this private placement of convertible preferred shares at no less than 80% of the theoretical price should be considered reasonable. However, due to recent closing prices in the centralized trading market not exceeding the face value, the price of the private placement of convertible preferred shares may be lower than the face value. If the future private placement price is lower than the face value, the impact on shareholders' equity would be the accumulation of losses resulting from the difference between the private placement price and the face value, which will be eliminated based on The Company's future operating results. | | | | |
| Method of selection of qualified persons | This offering is conducted in compliance with Article 43-6 of the Securities Exchange Law. | | | | |
| Reason for necessity of private placement | (1) Reason for not adopting a public offering: In consideration of the timeliness and feasibility of raising capital in the capital market, we intend to raise funds through a private placement to specific individuals.

(2) Amount of the private placement: Within the quota of 625,000,000 shares, to be conducted once within one year from the date of the shareholders' meeting.

(3) Intended use of the private placement proceeds and expected benefits: The private placement proceeds will be used to improve the financial structure and increase operating capital to cope with changes in future economic conditions, business growth needs, and to enhance The Company's competitiveness. | | | | |
| Share payment completion date | October 31, 2012 | | | | |
| Information on the places | Counterparty of the private placement | Qualifications | Subscription Quantity | Relationship with The Company | Participation in Company Operations |
| | TECO Electric & Machinery Co., Ltd | Meet the requirements of Article 43-6, paragraph 1, subparagraph 3 of the Securities Exchange Law | 320,000,000 | Hold at least 10% of The Company's shares as a corporate director or shareholder. | None |
| | Liu, Chao-Kai | Meet the requirements of Article 43-6, paragraph 1, subparagraph 3 of the Securities Exchange Law | 13,333,350 | The Company's responsible person | The Company's responsible person |
| Actual subscription (or conversion) price | NT$1.5 per share | | | | |
| Difference between actual subscription (or conversion) price and reference price | Not Applicable | | | | |
| Impacts of private placement on shareholders' equity (for example, increase of cumulative losses) | Accumulated Losses Increased | | | | |
| Fund utilization of private placement and project implementation progress | Completed in the third quarter of 2013 | | | | |
| Private placement benefits | To enhance working capital and improve financial structure. | | | | |

-100-

| Item | Private Placement of Convertible Preferred Shares in 2021
Issuance Date: November 17, 2021 | | | | |
| --- | --- | --- | --- | --- | --- |
| Type of private placement securities | Unsecured Corporate Bonds | | | | |
| Date of approval by the Board of Directors and amount approved | Approval Date: November 3, 2021 Total Issuance Amount: NT$133,000 thousand dollars | | | | |
| Basis and rationality of the price setting | Not Applicable | | | | |
| Method of selection of qualified persons | This offering is conducted in compliance with Article 43-6 of the Securities Exchange Law. | | | | |
| Reason for necessity of private placement | (1) Reasons for not using public offering: Due to The Company's accumulated losses, public offering is not feasible. Considering the timing and feasibility of capital market fundraising, The Company intends to raise funds through private placement to specific individuals.
(2) Private placement amount: The total issuance amount is NT$133,000 million.
(3) Intended use of funds and expected benefits of private placement: The funds raised through private placement will be used to improve The Company's financial structure and to enhance operating capital, in order to respond to future changes in economic conditions, business growth needs, and to increase The Company's competitiveness. | | | | |
| Share payment completion date | November 17, 2021 | | | | |
| Information on the places | Private Placement Recipients | Qualification Requirements: | Subscription Quantity | Relationship with The Company | Participation in Company Operations |
| | BAYCOM OPTO-ELECTRONICS TECHNOLOGY CO.,LTD. | Qualified party under Article 43-6 of the Securities Exchange Law | 133,000,000 | A subsidiary of The Company. | None |
| Actual subscription (or conversion) price | Not Applicable | | | | |
| Difference between actual subscription (or conversion) price and reference price | Not Applicable | | | | |
| Impacts of private placement on shareholders' equity (for example, increase of cumulative losses) | None | | | | |
| Fund utilization of private placement and project implementation progress | Completed in the fourth quarter of 2021 | | | | |
| Private placement benefits | To enhance working capital and improve financial structure. | | | | |

AI assistant

Tecom Co., Ltd. — Annual Report 2025

52005_rns_2026-05-11_3f8ff5af-4f07-4aac-bd7c-00706d7577cc.pdf

2025 ANNUAL REPORT

Table of Contents for Annual Report

I. Letter to Shareholders

1. Results of Business Plan Implementation

2. 2025 Financial Revenue and Expenditure Analysis and Profitability Analysis

3. Research Development Expenditure

5. Professional Qualifications and Independence of Directors

6. Board Diversity and Independence

(1) Board Diversity:

(2) Board of Directors' Independence:

3. Corporate Governance Status

(1) The Board of Directors Implementation Status (2024)

5. Change of Accountants

(2) Major Shareholders

2. Corporate Bonds

3. Preferred Shares

Industry overview

1. Industry Status and Development

Regarding EMS Function Optimization:

Expansion of Industry Applications

Smart Monitoring and AI Optimization

Strategic Partnerships and Regional Development

2. Industry Upstream, Midstream, and Downstream Relationships

3. Various development trends and competitive landscape of the product

(1) Cloud and Mobile Devices

(2) Industry 4.0 Drives the Rise of Smart Factories

2. Short-Term Business Development Plan

Smart Mechatronics:

TECOM Smart Energy and Carbon Management Platform

(1) PBX Business Telephone System

(2) CCTV Intelligent Surveillance System

(3) Mobile Communication Products

Long-Term Business Development Plan

(2) e-Home Smart Home System

2. Market and Sales Overview

(1) Market Analysis

Competitive Niches

2. Opportunities, Challenges, and Strategies for Development

(1) Opportunities:

(4). Fusion Access System

(5). Cloud-based Smart Electromechanical Health Management IoT System (MHm-P) for Industry 4.0

Key Advantages Over Traditional Inspection Tools:

(8). Next Generation Vibration Meter Series

4. Environmental Expenditure Information

5. Labor Relations

6. Information Security Management

7. Important Contracts

V. Review and Analysis of Financial Status and Business Results and Risk Issue

1. Financial Status

2. Financial Performance

3. Cash Flow

(2) Analysis of Cash Liquidity for the Next Year

2. Private Placement of Securities in the Past Year and as of the Date of Publication of the Annual Report

More from Tecom Co., Ltd.

Tecom Co., Ltd. Annual Report 2025