TFC - AGM Information 2021 | FinancialReports.eu

Stock No.: 1722

TAIWAN FERTILIZER CO., LTD.

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2021 Annual General Shareholders’ Meeting Minutes

Jul 28, 2021

Venue: GIS MOTC Convention Center

(No. 24, Sec.1, Hangzhou S.Rd., Zhongzheng Dist., Taipei City)

TAIWAN FERTILIZER CO., LTD. 2021 Annual General Shareholders’ Meeting Minutes

Date: July 28, 2021, 9:00AM (Wednesday)

Venue: GIS MOTC Convention Center (No. 24, Sec.1, Hangzhou S.Rd., Zhongzheng Dist., Taipei City)

Attendance: 570,838,145 out of a total of 980,000,000 shares outstanding (Shares present in person and in proxy), which represents 58.24% of shares outstanding (including 239,410,678 for those who have exercised their voting power by way of electronic transmission)

Others present: Chiang Ta-Chung, Attorney at law of Lee and Li Attorneys and Law Tseng Kuo-Yang, CPA of KPMG Director Fan Mei-Ling Director Sun Uang-Shyang Independent Director Lee Ming-Shiuan Independent Director Lin Horng-Chang

Chairman: Huang Yao-Hsing Meeting Secretary : Liu Chi-Ching

Commencement: Report on Number of Shares Present or Represented

I. Chairman’s Address : (Omitted)

II. Reported Items

Report No. 1

Subject: The Company’s 2020 business report

Description

I. The 2020 Business Report have been reviewed by the Audit Committee, and approved by the Board of Directors in the 27th meeting, 34th Term on March 25, 2021.
II. Attached please find the Company's 2020 business report

Business Report

1. Foreword:

Looking back to 2020, all industries were severely impacted by the global pandemic. Although the Company’s revenue is no exception, but with the hard working and efforts made by the management team, the gross profit of fertilizer, chemical engineering, and lease achieved growth. In addition, the re-investment gain of Al-Jubail Fertilizer Company, and the gain from disposing investment real estate are recognized. The final consolidated net profit of the term is NTD 2,452,881 thousands, or 18.84% higher from 2019.

2. Overview of Business:

(I) Production and marketing :

The Company's actual output of fertilizer products totaled 550,500 tons in 2020, decreased by 5.48% from 2019. The output of chemical engineering products totaled 193,318 tons, decreased by 1.69% from 2019. The actual sales of fertilizer products totaled 634,983 tons, decreasing by 16.64% from 2019, (the domestic sales of fertilizer products increased, but the re-sale of urea by Al-Jubail decreased, and thus the total sales decreased.) And that of chemical engineering products totaled 194,274 tons, decreased by 2.84% from 2019.

(II) Operating revenue and profit:

1. Parent-only financial statement

The operating revenue was NTD9,931,129 thousand in 2020, decreased by 21.34% from NTD12,624,716 thousand in 2019. The net operating profit, NTD1,188,302 thousand, decreased by 27.04% from 2019. The net non-operating profit was NTD1,775,881 thousand, increased by 112.80% from 2019. The current net profit was NTD2,452,881 thousand ， increased by 18.84% from 2019.

2. Consolidated financial statements

The operating revenue was NTD10,169,742 thousand in 2020, decreased by 21.11% from NTD12,890,565 thousand in 2019. The net operating profit, NT$1,247,689 thousand, decreased by 23.27% from 2019. The net non-operating profit was NTD1,717,686 thousand, increasing by 104.91% from 2019. The current net profit

wasNTD2,452,881 thousand ， increased by 18.84% from 2019.

(III) Financial structure:

1. Parent-only financial statement

The Company had solid financial structure. Until December 31, 2020, the Company has had the assets totaled NTD75,768,371 thousand, and liabilities totaled NTD24,459,660 thousand. The liability ratio was 32.28%. The equity amounted to NTD51,308,711 thousand, and EPS NTD52.36.

Consolidated financial statements

The Company had solid financial structure. Until December 31, 2020, the Company has had the assets totaled NTD76,346,127 thousand, and liabilities totaled NTD25,037,416 thousand. The liability ratio was 32.79%. The equity amounted to NTD 51,308,711 thousand, and EPS NT$52.36.

(IV) Investment plan:

The new compounded fertilizer factory and chemical tanks newly constructed at the West 10th Pier of Taichung Harbor have been completed in 2020, and the mass production has been started gradually in the latter half of 2020. In the future, the synergies of operation and management are expected to increase the overall profit. For the C2 development in Nangang Software Park, the construction progress has achieved 67.12% (as of December 2020). The development operation is in progress as scheduled. And the construction permit for C4 development project has been received and the construction was started. The development, planning, and merchant recruitment for the Hsinchu Science and Commerce Park, and the land of old plant in Kaohsiung are in progress, too. The sustainable properties are established in a gradual manner, to become a foundation of stable profit for the Company.

III. Outlook

The international geopolitics, the U.S-Sino trade dispute, and pandemic are slowing down, but they impact the macro economy greatly. The Company will keep on monitoring the development of international conditions, for better responses.

In the regard of fertilizer and chemical engineering business, the strategy to develop niche product will still be applied. Other than expanding business scope to increase revenue, the synergies of operation and management are expected to increase the overall profit.

For the real estate development business, we will continue to be very selective, and establish the sustainable properties. The development projects of Nangang Software Park and Hsinchu Science and Commerce Park are advanced as planned, to ensure the operational guideline of increasing profit weight of sustainable properties.

Chairman of Board: Yao-Hsing Huang General Manager: Yao-Hsing Huang

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Chief Accountant: Mei-Ling Huang

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Report No. 2

Subject: The Audit Committee’s report on the Company’s 2020 annual final accounts and statements

Audit Report of the Audit Committee

The Company's 2020 business report, financial statements and statement of earnings distribution were submitted by the Company’s Board of Directors. The financial statements were already audited by Kuo-Yang Tseng, CPA and Heng-Sheng Lin of KPMG, who also issued the auditor report accordingly.

The Audit Committee, after completing the audit of said business report, financial statements and statement of earnings distribution, believes that they are free of material misstatement, and thus produces this report according to Article 219 of the Company Act.

Please review accordingly.

To:

2021 General Shareholders’ Meeting of the Company

TAIWAN FERTILIZER CO., LTD. Convener of Audit Committee: Lin, Hung-Chang

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March 25, 2021

Report No. 3

Subject: The report on remuneration to the Company's directors and employees in 2020.Please proceed to report.

Submitted by the Board of Directors

Description:

I. This matter is handled in accordance with the subparagraph 1 of Article 25 of the Company's Articles of Incorporation.
II. The profit sought by the Company in 2020 based on the financial statements as audited by KMPG (the income before earnings before tax less remuneration to employees, directors and supervisors) totaled NT$3,087,690,792.
III. The remuneration payable to directors and employees pursuant to the Company's Articles of Incorporation is stated as following:
(I) Remuneration to directors/supervisors, NT$49,403,052, in cash Meet the requirement about 1.6% of the profit, NT$3,087,690,792, in 2020.
(II) Remuneration to employees, NT$74,104,579, in cash: Meet the requirement about 2.4% of the profit, NT$3,087,690,792, in 2020.
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Report No. 4

Subject: The report on amendments to the “Code of Ethical Conduct for the Company's Directors and the Highest-level Executives and above” in part

Submitted by the Board of Directors

Description

I. By referring to the amended “Guidelines for the Adoption of Codes of Ethical Conduct for TWSE/GTSM Listed Companies,“ announced by TWSE with Letter Tai-Zheng-Zhi-Li-Zhi No. 10900094681, dated June 3, 2020,” Article 3, 9, 10, 11, and 12 of the “Code of Ethical Conduct for the Company's directors and 1st-level executive officer and above“ were amended, and approved by the Board of Directors in the 21st meeting, 34th Term on June 30, 2020.
II. The comparison table for amendments to the “Code of Ethical Conduct for Directors and 1st-level executive officer and above of Taiwan Fertilizer Co., Ltd.” is enclosed herewith (see Attachment).
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Code of Ethical Conduct for the Company's Directors and the Highest-level Executives and above of Taiwan Fertilizer Co., Ltd.

Amended Provision Article 3 Preventing Conflict of Interest

Current Provision Article 3 Preventing Conflict of Interest

Remark I. By referring Article 26-3 Paragraph 3 of the Securities and Exchanges Act, and Article 17 Paragraph 1, Subparagraph 3 of the “Supplementary Provisions to the Taiwan Stock Exchange Corporation Rules for Review of Securities Listings” issued by TWSE, the criteria of independence among directors and supervisors, the requirement of relatives in Article 3 is amended. II. As parents and children are both within the second degree of kinship, the wording is simplified.

Amended Provision	Current Provision	Remark
Article 3 Preventing Conflict of Interest The directors and 1st-level executive officer and above shall avoid the conflicts of interest arising when personal interest intervenes or is likely to intervene in the overall interest of the Company, as for example when they are unable to perform their duties in an objective and efficient manner, or when they take advantage of their positions in the Company to obtain improper benefits for either themselves or their spouses, or relatives within thesecond degree of kinship. In order to prevent the conflict of interest, the loans of funds, provisions of guarantees, and major asset transactions between the Company and said persons or the affiliates in which they work for shall be subject to review and approval by the Board of Directors. The relevant purchase (sale) shall be handled by taking into consideration the Company’s maximum interest.	Article 3 Preventing Conflict of Interest The directors and 1st-level executive officer and above shall avoid the conflicts of interest arising when personal interest intervenes or is likely to intervene in the overall interest of the Company, as for example when they are unable to perform their duties in an objective and efficient manner, or when they take advantage of their positions in the Company to obtain improper benefits for either themselves or their spouses, parents, children, or relatives within thethirddegree of kinship. In order to prevent the conflict of interest, the loans of funds, provisions of guarantees, and major asset transactions between the Company and said persons or the affiliates in which they work for shall be subject to review and approval by the Board of Directors. The relevant purchase (sale) shall be handled by taking into consideration the Company’s maximum interest.	I. By referring Article 26-3 Paragraph 3 of the Securities and Exchanges Act, and Article 17 Paragraph 1, Subparagraph 3 of the “Supplementary Provisions to the Taiwan Stock Exchange Corporation Rules for Review of Securities Listings” issued by TWSE, the criteria of independence among directors and supervisors, the requirement of relatives in Article 3 is amended. II. As parents and children are both within the second degree of kinship, the wording is simplified.
Article 3 Preventing Conflict of Interest The directors and 1st-level executive officer and above shall avoid the conflicts of interest arising when personal interest intervenes or is likely to intervene in the overall interest of the Company, as for example when they are unable to perform their duties in an objective and efficient manner, or when they take advantage of their positions in the Company to obtain improper benefits for either	Article 3 Preventing Conflict of Interest The directors and 1st-level executive officer and above shall avoid the conflicts of interest arising when personal interest intervenes or is likely to intervene in the overall interest of the Company, as for example when they are unable to perform their duties in an objective and efficient manner, or when they take advantage of their positions in the Company to obtain improper benefits for either	By referring Article 26-3 Paragraph 3 of the Securities and Exchanges Act, and Article 17 Paragraph 1, Subparagraph 3 of the “Supplementary Provisions to the Taiwan Stock Exchange Corporation Rules for Review of Securities Listings” issued by TWSE, the criteria of independence among directors and supervisors, the requirement of relatives in Article 3 is amended. As parents and children are both within the second degree of

themselves or their spouses, or relatives within the second degree of kinship. In order to prevent the conflict of interest, the loans of funds, provisions of guarantees, and major asset transactions between the Company and said persons or the affiliates in which they work for shall be subject to review and approval by the Board of Directors. The relevant purchase (sale) shall be handled by taking into consideration the Company’s maximum interest.	themselves or their spouses, parents, children, or relatives within the third degree of kinship. In order to prevent the conflict of interest, the loans of funds, provisions of guarantees, and major asset transactions between the Company and said persons or the affiliates in which they work for shall be subject to review and approval by the Board of Directors. The relevant purchase (sale) shall be handled by taking into consideration the Company’s maximum interest.	kinship, the wording is simplified.
Article 9 Encouraging reporting on misconduct or any conduct against the Code of Ethical Conduct: The Company's employees shall report to the Audit Committee, managers, internal auditor officers or other competent persons about any misconduct or conduct against the Code of Ethical Conduct committed by any director or 1st-level executive officer and above, upon awareness of the same. To encourage reporting misconducts, the Company shall establish the concrete whistleblowing system that allows anonymous reporting and make the employees be aware that the Company will make the best effort to protect the whistleblower from retaliations.	Article 9 Encouraging reporting on misconduct or any conduct against the Code of Ethical Conduct: The Company's employees shall report to the Audit Committee, managers, internal auditor officers or other competent persons about any misconduct or conduct against the Code of Ethical Conduct committed by any director or 1st-level executive officer and above, upon awareness of the same. Once the reported case is proven true, the Company will reward them pursuant to the relevant requirements. The Company shall process the reported information as confidential information, and shall make every endeavor to keep in confidence the informants’ identity and protect their safety to prevent them from retaliation and threat in anyform.	By referring to Article 23 of the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies, the anonymous whistleblowing is allowed and thus the related texts are amended. Also by referring to the template of the Guidelines for the Adoption of Codes of Ethical Conduct for TWSE/GTSM Listed Companies of TWSE, the texts of Article 9 are amended.
Article 10 Disciplinary measures: When the directors or 1st-level executive officers and above	Article 10 Disciplinary measures: When the directors or 1st-level executive officers and above	To accommodate the enforcement of the Personal Information Protection Act, the texts of Article 10 are amended.

violate the Code of Ethical Conduct, the Company shall verify the truth and report the same to the Board of Directors. The violator shall bear the relevant civil and criminal liabilities, and be disciplined according to the relevant requirements, in the case of 1st- level executive officers and above. The Company shall also without delay disclose on the Market Observation Post System (MOPS) the violator’s date of violation, reasons for the violation, the provisions of the Code violated, and the disciplinary actions taken. The violator may seek remedies under the relevant appeal system established by the Company.	violate the Code of Ethical Conduct, the Company shall verify the truth and report the same to the Board of Directors. The violator shall bear the relevant civil and criminal liabilities, and be disciplined according to the relevant requirements, in the case of 1st- level executive officers and above. The Company shall also without delay disclose on the Market Observation Post System (MOPS) the violator’s job title, name, date of violation, reasons for the violation, the provisions of the Code violated, and the disciplinary actions taken. The violator may seek remedies under the relevant appeal system established by the Company.
Article 11 Any exemption of directors or 1st-level executive officers and above from compliance with the Code with good cause shall be approved upon resolution by the Board of Directors and the information on the date on which the Board of Directors adopted the resolution for exemption, the objections or reservations of any independent director, period and cause of exemption and standards applicable to the exemption shall be disclosed without delay on the MOPS, for the shareholders to assess if the resolution adopted by the Board of Directors is appropriate, in order to prevent the arbitrary or suspicious exemption from the code of ethical conducts, while assuring any circumstances in the code of ethical conducts are covered under a proper control mechanism, to protect the Company.	Article 11 Any exemption of directors or 1st-level executive officers and above from compliance with the Code with good cause shall be approved upon resolution by the Board of Directors and the information on the exempted person's job title and name, the date on which the Board of Directors adopted the resolution for exemption, period and cause of exemption and standards applicable to the exemption shall be disclosed without delay on the MOPS, so that the shareholders may evaluate the appropriateness of the resolution and maintain the Company's interest and rights.	To accommodate the enforcement of the Personal Information Protection Act and by referring to Article 14-3, the Securities and Exchange Act, regarding the speech records of independent directors and the template of the Guidelines for the Adoption of Codes of Ethical Conduct for TWSE/GTSM Listed Companies of TWSE, the texts of Article 11 are amended.

Article 12 The code shall be disclosed on the Company’s website, annual reports, prospectus and the MOPS. The same applies to the amendments.	Article 12 The code shall be disclosed on annual reports, prospectus, and the MOPS. The same applies to the amendments.	By referring to the requirement of NYSE Listed Company Manual 303A.10 for companies to disclose the code of ethical conducts on their website and the requirements of Article 3-3, the “Taiwan Stock Exchange Corporation Rules Governing Information Filing by Companies with TWSE Listed Securities and Offshore Fund Institutions with TWSE Listed Offshore Exchange-Traded Funds” that “a TWSE listed company shall establish a company website,” the texts of this Article are amended.

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III. Ratification Items

Ratification No. 1

Subject: The Company's 2020 business report and financial statements are submitted for ratification,rought forth for your ratification.

Submitted by the Board of Directors

Description

I. The Company’s 2020 financial statements and its subsidiaries’ consolidated financial statements have already audited by the external auditors with audit report. Said financial statements, together with the business report (please see Pages 2~3 of the Handbook), were also reviewed by the Audit Committee and the audit report is issued accordingly.
II. The proposal was approved up the deliberation of Board in the 27th meeting, 34th Term on March 25, 2021.
III. Enclosed please find the Company's 2020 Independent Auditor’s Report and Financial Statements (see Attachment).

Resolution: THAT the above is approved by ordinary resolution. The voting rights of the attending shareholders when voting: 570,834,145 rights.

Voting Results	Percentage of the voting rights of the attending shareholders
Votes favorable: 519,801,600 rights (electronic votes of 221,651,153 rights included)	91.05%
Votes against: 93,924 rights (electronic votes of 93,924 rights included)	0.01%
Invalid rights: 0 right	0%
Abstained and un-voted rights: 50,938,621 rights (electronic votes of 17,665,601 rights included)	8.91%

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Stock Code:1722

TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Financial Statements

With Independent Auditors ’ Report For the Years Ended December 31, 2020 and 2019

Address: 6F, No.88, Nanjing E. Rd., Sec 2, Taipei City 10457, Taiwan Telephone: (02)2542-2231

The independent auditors’ report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and consolidated financial statements, the Chinese version shall prevail.

Contents 1. Cover Page 2. Table of Contents 3. Representation Letter 4. Independent Auditors’Report 5. Consolidated Balance Sheets 6. Consolidated Statements of Comprehensive Income 7. Consolidated Statements of Changes in Equity 8. Consolidated Statements of Cash Flows 9. Notes to Consolidated Financial Statements (1) Company history (2) Approval date and procedures of the consolidated financial statements (3) New standards, amendments and interpretations adopted (4) Summary of significant accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Commitments and contingencies (10) Losses Due to Major Disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (d) Major shareholders (14) Segment information		Page
	1 2 3 4 5 6 7 8 9 9 9～10 11～29 29～30 30～66 66～68 68 68～69 69 69 69 70～74 74～75 75 76 76～77

Representation Letter

The entities that are required to be included in the combined financial statements of TAIWAN FERTILIZER CO., LTD. as of and for the year ended December 31, 2020 under the Criteria Governing the Preparation of Affiliation Reports, Consolidated Business Reports, and Consolidated Financial Statements of Affiliated Enterprises are the same as those included in the consolidated financial statements prepared in conformity with International Financial Reporting Standards No. 10 by the Financial Supervisory Commission, "Consolidated Financial Statements." In addition, the information required to be disclosed in the combined financial statements is included in the consolidated financial statements. Consequently, TAIWAN FERTILIZER CO., LTD. and Subsidiaries do not prepare a separate set of combined financial statements.

Company name: TAIWAN FERTILIZER CO., LTD. Chairman: Huang-Yao Hsing Date: March 25, 2021

Independent Auditors ’ Report

To the Board of Directors of TAIWAN FERTILIZER CO., LTD.:

Opinion

We have audited the consolidated financial statements of TAIWAN FERTILIZER CO., LTD. and its subsidiaries (“the Group”), which comprise the consolidated Balance Sheets as of December 31, 2020 and 2019, and the consolidated statement of comprehensive income, changes in equity and cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the report of other auditors (please refer to Other Matter paragraph), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2020 and 2019, and its consolidated financial performance and its consolidated cash flows for the year ended December 31, 2020 and 2019 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“IFRSs”), International Accounting Standards (“IASs”), interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (the “Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements for the year ended December 31, 2020. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. The key audit matters that, in our professional judgment, should be communicated are as follows:

Impairment assessment of intangible assets

For the accounting policy of impairment assessment of intangible assets, please refer to note 4 (m) “Intangible assets” of the consolidated financial statements. For the accounting estimate and uncertainty assumption of impairment assessment of intangible assets, please refer to note 5 of the consolidated financial statements. For the impairment assessment of intangible assets, please refer to 6(l) of the consolidated financial statements.

4-1

Key audit matters:

As described in Note 6(l) of the consolidated financial statements, the Group acquired control over Taiwan Yes Deep Ocean Water Co., Ltd. (“ Taiwan Yes” ), which was accounted for as acquisition using the equity method (including the goodwill and trademark with indefinite useful lives). In accordance with IAS 36 “Impairment of Assets”, goodwill and intangible assets with indefinite useful lives should be tested for impairment annually; and based on the estimated future cash flows of Taiwan Yes (the cash-generating unit), the recoverable amount was evaluated in order to determine whether there is any impairment of the aforementioned investment accounted for by using the equity method (including the goodwill and intangible assets with indefinite useful lives). Since the estimated future cash flows requires management’s forecasting of the industry overview and the future operating performance of Taiwan Yes, the recoverable amount will be affected and an impairment loss will be incurred should there be any change in the situation. Therefore, the impairment assessment of equity-method investments has been identified as a key audit matter.

How the matter was addressed in our audit:

Our principal audit procedures included confirming whether the management has properly assessed the recoverability of goodwill based on the forecasted cash flows within the following 5 years, wherein the assessment has been reviewed by the competent authority; and verifying whether the management has disclosed the impairment of goodwill in the financial statements on a timely manner after identifying such circumstance. In addition, we also assessed the adequacy of the forecasting methods and the discount rate used ’ by the management, and compared the discount rate with external information; verified the management s assumptions with external relevant information, and evaluated the major assumptions (including the forecast revenue growth rate, discount rate and forecast margin).

Other Matter

We did not audit the consolidated financial statements as of and for the years ended December 31, 2020 and 2019 of the certain investees in equity method. Those statements were audited by other auditors, whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included in the corporation's financial statements for these investees, is based solely on the report of other auditors. As of December 31, 2020 and 2019, the investments in the aforementioned investees are 12.05% (NT$9,202,183 thousand) and 12.30% (NT$9,304,896 thousand) of consolidated total assets. For the years ended December 31, 2020 and 2019, the investment income on the above said investees are 20.02% (NT$593,696 thousand) and 30.49% (NT$751,432 thousand) of the Company's income before income tax.

TAIWAN FERTILIZER CO., LTD. has additionally prepared its parent company only financial statements as of and for the years ended December 31, 2020 and 2019, on which we have issued an unqualified opinion.

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

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs, IASs, interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

’ In preparing the consolidated financial statements, management is responsible for assessing the Group s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

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Those charged with governance are responsible for overseeing the Group’s financial reporting process.

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

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

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

4-3

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Kuo-Yang Tseng and Heng-Shen Lin.

KPMG

Taipei, Taiwan (Republic of China) March 25, 2021

Notes to Readers

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

The independent auditors’ audit report and the accompanying consolidated financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and consolidated financial statements, the Chinese version shall prevail.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020 Amount % $ 3,062,027 4 1,300,013 2 112,566 - 118,885 - 659,112 1 12,797 - 6 - 2,822,354 4 364,115 - 1,066,109 1 8,935 -	December 31, 2020	December 31, 2020	December 31, 2020
	Amount	%	Amount
	2,232,969 3 2,042,946 3
	455,120 1 223,648 - 7,104,724 10 7,089,164 10 160,439 - 192,913 - 14,627,720 19 15,018,003 20 131,319 - 107,486 - 325,125 - 257,583 -
9,526,919 12
2,712,178 4 28,507 - 9,282,092 12 14,758,989 20 1,150,181 2 38,102,213 50 122,639 - 325,883 - 115,396 - 193,730 - 27,400 -
	22,804,447 30 22,888,797 30
	25,037,416 33 24,931,743 33
	9,800,000 13 9,800,000 13 2,244,652 3 2,244,073 3 3,397,549 4 3,191,153 4 30,823,647 41 31,147,849 41 3,391,695 4 2,994,828 4 1,651,168 2 1,347,150 2
66,819,208 88
	51,308,711 67 50,725,053 67
$ 76,346,127 100	$ 76,346,127 100 75,656,796 100

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

2020	% 100 (75)	2019	% 100 (76)
Amount $ 10,169,742 (7,580,633)		Amount 12,890,565 (9,859,254)
2,589,109	25	3,031,311	24
299,990 974,846 66,584	3 9 1	298,297 1,040,379 66,624	2 8 1
1,341,420	13	1,405,300	11
1,247,689	12	1,626,011	13
44,080 80,046 1,019,917 (4,561) 578,204	- 1 10 - 6	86,167 79,017 (49,252) (5,216) 727,540	- - - - 6
1,717,686	17	838,256	6
2,965,375 512,494	29 5	2,464,267 400,312	19 3
2,452,881	24	2,063,955	16
(35,816) 715,107 10,833 (7,163)	- 7 - -	(4,398) 195,108 2,740 (879)	- 2 - -
697,287	7	194,329	2
(7,717) (504,660) (101,288)	- (5) (1)	(3,996) (195,916) (39,297)	- (2) -
(411,089)	(4)	(160,615)	(2)
286,198	3	33,714	-
$ 2,739,079	27	2,097,669	16
$ 2,452,881	24	2,063,955	16
$ 2,739,079	27	2,097,669	16
$	2.50		2.11
$	2.50		2.10

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Balance at January 1, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Reversal of special reserve Changes in equity of associates and joint ventures accounted for using equity method Balance at December 31, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Reversal of special reserve Other changes in capital surplus Balance at December 31, 2020
	Share capital Ordinary shares Capital surplus	Retained earnings
		Legal reserve Special reserve Unappropriate d retained earnings Total retained earnings

See accompanying notes to consolidated financial statements.

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Expected credit gain for bad debt expense Net gain on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of profit of associates and joint ventures accounted for using equity method (Gain) loss on disposal of property, plant and equipment, net Gain on disposal of investment properties Impairment loss on non-financial assets Unrealized foreign current exchange (gain) loss Donation expense Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Decrease (increase) in notes receivable Decrease (increase) in accounts receivable Decrease (increase) in other receivable Decrease (increase) in inventories Decrease (increase) in prepayments Decrease (increase) in other current assets Total changes in operating assets Increase (decrease) in contract liabilities Increase (decrease) in notes payable Increase (decrease) in accounts payable Increase (decrease) in other payable Increase (decrease) in receipts in advance Increase (decrease) in other current liabilities Increase (decrease) in net defined benefit liability Increase (decrease) in deferred credits Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Income taxes refund (paid) Net cash flows from (used in) operating activities	For the years ended December 31 2020 2019 $ 2,965,375 2,464,267 1,074,367 1,004,707 6,524 6,662 - (1,323) (5,065) (9,926) 4,561 5,216 (44,080) (86,167) (41,776) (41,806) (578,204) (727,540) (1,025) 33 (1,047,961) (15,405) - 12,891 (11,245) 22,775 10,075 19,532	For the years ended December 31 2020 2019 $ 2,965,375 2,464,267 1,074,367 1,004,707 6,524 6,662 - (1,323) (5,065) (9,926) 4,561 5,216 (44,080) (86,167) (41,776) (41,806) (578,204) (727,540) (1,025) 33 (1,047,961) (15,405) - 12,891 (11,245) 22,775 10,075 19,532
	2020 $ 2,965,375 1,074,367 6,524 - (5,065) 4,561 (44,080) (41,776) (578,204) (1,025) (1,047,961) - (11,245) 10,075
	(633,829)	189,649
	75,782 80,799 3,591 (377,280) (200,631) (5,472)	(5,515) 296,739 1,602 366,905 375,182 149
	(423,211)	1,035,062
	(18,436) (8,957) (156,269) (16,595) 292,522 6,522 (11,983) (390,367)	(60,751) 8,096 (146,012) (103,907) 8,964 (4,298) (11,159) (392,092)
	(303,563)	(701,159)
	(726,774)	333,903
	(1,360,603)	523,552
	1,604,772 45,422 234,284 (4,561) (555,851)	2,987,819 86,310 1,324,413 (5,216) (675,289)
	1,324,066	3,718,037

8-1

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows (CONT ’ D)

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of financial assets designated at fair value through profit or loss Proceeds from disposal of financial assets designated at fair value through profit or loss Acquisition of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease in other receivables Acquisition of intangible assets Acquisition of investment properties Proceeds from disposal of investment properties Decrease (increase) in other financial assets Decrease (increase) in other non-current assets Net cash flows from (used in) investing activities Cash flows from (used in) financing activities: Increase in short-term loans Decrease in short-term loans Increase (decrease) in guarantee deposits received Payment of lease liabilities Cash dividends paid Net cash flows from (used in) financing activities Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	For the years ended December 31 2020 2019 (150,000) - 98,000 2,927 (5,710,000) (1,826,799) 5,975,233 2,083,118 - (10,000) (943,905) (1,145,721) 1,039 224 20,718 129,375 (2,230) - (2,516,076) (1,065,863) 1,422,740 22,826 3,118,621 (586,643) 30,535 (7,770)	For the years ended December 31 2020 2019 (150,000) - 98,000 2,927 (5,710,000) (1,826,799) 5,975,233 2,083,118 - (10,000) (943,905) (1,145,721) 1,039 224 20,718 129,375 (2,230) - (2,516,076) (1,065,863) 1,422,740 22,826 3,118,621 (586,643) 30,535 (7,770)
	2020 (150,000) 98,000 (5,710,000) 5,975,233 - (943,905) 1,039 20,718 (2,230) (2,516,076) 1,422,740 3,118,621 30,535
	1,344,675	(2,404,326)
	24,000 (36,000) 67,542 (31,832) (2,156,000)	136,000 (136,000) (22,815) (30,689) (2,156,000)
	(2,132,290)	(2,209,504)
	5,948 542,399 2,519,628	(25,637) (921,430) 3,441,058
	$ 3,062,027	2,519,628

See accompanying notes to consolidated financial statements.

Stock Code:1722

TAIWAN FERTILIZER CO., LTD.

Parent Company Only Financial Statements

With Independent Auditors ’ Report For the Years Ended December 31, 2020 and 2019

Address: 6F, No.88, Nanjing E. Rd., Sec 2, Taipei City 10457, Taiwan Telephone: (02)2542-2231

The independent auditors’ report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ report and parent company only financial statements, the Chinese version shall prevail.

Contents 1. Cover Page 2. Table of Contents 3. Independent Auditors’Report 4. Balance Sheets 5. Statements of Comprehensive Income 6. Statements of Changes in Equity 7. Statements of Cash Flows 8. Notes to Financial Statements (1) Company history (2) Approval date and procedures of the financial statements (3) New standards, amendments and interpretations adopted (4) Summary of significant accounting policies (5) Significant accounting assumptions and judgments, and major sources of estimation uncertainty (6) Explanation of significant accounts (7) Related-party transactions (8) Pledged assets (9) Commitments and contingencies (10) Losses Due to Major Disasters (11) Subsequent Events (12) Other (13) Other disclosures (a) Information on significant transactions (b) Information on investees (c) Information on investment in mainland China (d) Major shareholders (14) Segment information 9. List of major account titles		Page
	1 2 3 4 5 6 7 8 8 8～9 10～27 27～28 28～62 63～66 66 66～67 67 67 67～68 69～72 72～73 73 73 73 74～80

Independent Auditors ’ Report

To the Board of Directors of TAIWAN FERTILIZER CO., LTD.:

Opinion

We have audited the financial statements of TAIWAN FERTILIZER CO., LTD.(“the Company”), which comprise the Balance Sheets as of December 31, 2020 and 2019, and the statement of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the report of other auditors (please refer to Other Matter paragraph), the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2020 and 2019, and its financial performance and its cash flows for the year ended December 31, 2020 and 2019 in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards ( “ IFRSs ” ), International Accounting Standards (“IASs”), interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

We conducted our audits in accordance with the Regulations Governing Auditing and Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements for the year ended December 31, 2020. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. The key audit matters that, in our professional judgment, should be communicated are as follows:

Impairment assessment of investments in equity method (including goodwill and intangible assets with an indefinite useful life)

Please refer to notes 4(n), 5 and 6(h) for the “recognition of impairment assessment of investments ” “ accounted for by the equity method , assumptions used and uncertainties considered in determining investments accounted for by the equity method, investments for impairment loss and obsolescence” and “balances of impairment loss and obsolescence”, respectively.

3-1

Key audit matters:

As described in Note 6(h) of the accompanying financial statements, the Company acquired control over Taiwan Yes Deep Ocean Water Co., Ltd. (“ Taiwan Yes” ), which was accounted for as acquisition using the equity method (including the goodwill and trademark with indefinite useful lives). In accordance with IAS 36 “Impairment of Assets”, goodwill and intangible assets with indefinite useful lives should be tested for impairment annually; and based on the estimated future cash flows of Taiwan Yes (the cash-generating unit), the recoverable amount was evaluated in order to determine whether there is any impairment of the aforementioned investment accounted for by using the equity method (including the goodwill and intangible assets with indefinite useful lives). Since the estimated future cash flows requires management’s forecasting of the industry overview and the future operating performance of Taiwan Yes, the recoverable amount will be affected and an impairment loss will be incurred should there be any change in the situation. Therefore, the impairment assessment of equity method investments has been identified as a key audit matter.

How the matter was addressed in our audit:

Our principal audit procedures included confirming whether the management have properly assessed the recoverability of goodwill based on the forecasted cash flows within the following 5 years, wherein the assessment have been reviewed by the competent authority; and verifying whether the management has disclosed the impairment of goodwill in the financial statements on a timely manner after identifying such circumstance. In addition, we also assessed the adequacy of the forecasting methods and the discount rate used by the management, and compared the discount rate with external information; verified the management’s assumptions with external relevant information, and evaluated the major assumptions (including the forecast revenue growth rate, discount rate and forecast margin).

Other Matter

We did not audit the financial statements as of and for the years ended December 31, 2020 and 2019, of certain investees in equity method. Those statements were audited by other auditors, whose reports have been furnished to us. Our opinion, insofar as it relates to the amounts included in the Corporation’s financial statements for these investees, is based solely on the reports of the other auditors. As of December 31, 2020 and 2019, the investments in the aforementioned investees are 12.15% and 12.33% ($9,202,183 thousand and $9,304,896 thousand), of the Corporation’s total assets. For the years ended December 31, 2020 and 2019, the investment income on the above said investees are 20.03% and 30.51% ($593,696 thousand and $751,432 thousand) of the Corporation’s income before income tax.

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

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities Issuers and IFRSs, IASs, interpretation as well as related guidance endorsed by the Financial Supervisory Commission of the Republic of China, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s financial reporting process.

3-2

Auditors ’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the auditing standards generally accepted in the Republic of China will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the group audit.

3-3

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partners on the audit resulting in this independent auditors’ report are Kuo-Yang Tseng and Heng-Shen Lin.

KPMG

Taipei, Taiwan (Republic of China) March 25, 2021

Notes to Readers

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

The independent auditors’ audit report and the accompanying parent company only financial statements are the English translation of the Chinese version prepared and used in the Republic of China. If there is any conflict between, or any difference in the interpretation of the English and Chinese language independent auditors’ audit report and parent company only financial statements, the Chinese version shall prevail.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2020 Amount % $ 2,521,222 3 1,300,013 2 112,566 - 117,543 - 646,808 1 11,523 - 2,774,010 4 285,034 - 900,000 1 7,299 -	December 31, 2020	December 31, 2020
	Amount	%
	1,955,626 3 1,864,243 3
	223,648 - 223,648 - 7,104,724 10 7,089,164 10 136,462 - 164,257 - 14,627,720 19 15,018,003 20 131,319 - 107,486 - 280,161 - 250,609 -
8,676,018 11
2,712,178 4 28,507 - 12,121,677 16 12,421,858 17 1,122,080 2 38,094,155 50 11,724 - 285,570 - 115,396 - 159,188 - 20,020 -
	24,459,660 32 24,717,410 33
	9,800,000 13 9,800,000 13 2,244,652 3 2,244,073 3 3,397,549 5 3,191,153 4 30,823,647 41 31,147,849 41 3,391,695 4 2,994,828 4 1,651,168 2 1,347,150 2
	51,308,711 68 50,725,053 67
67,092,353 89
$ 75,768,371 100	$ 75,768,371 100 75,442,463 100

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Statements of Comprehensive Income

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

2020	% 100 (75)	2019	% 100 (76)
Amount $ 9,931,129 (7,458,489)		Amount 12,624,716 (9,640,510)
2,472,640	25	2,984,206	24
(258,061) (959,675) (66,602)	(2) (10) (1)	(255,859) (1,033,241) (66,440)	(2) (8) (1)
(1,284,338)	(13)	(1,355,540)	(11)
1,188,302	12	1,628,666	13
37,684 97,462 1,020,337 (3,581) 623,979	- 1 10 - 7	75,204 76,370 (34,615) (4,089) 721,671	1 1 - - 6
1,775,881	18	834,541	8
2,964,183 511,302	30 5	2,463,207 399,252	21 3
2,452,881	25	2,063,955	18
(35,816) 715,107 10,833 (7,163)	- 7 - -	(4,398) 195,108 2,740 (879)	- 2 - -
697,287	7	194,329	2
(512,377) (101,288)	(5) (1)	(199,912) (39,297)	(2) -
(411,089)	(4)	(160,615)	(2)
286,198	3	33,714	-
$ 2,739,079	28	2,097,669	18
$	2.50		2.11
$	2.50		2.10

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Statements of Changes in Equity

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Balance at January 1, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Reversal of special reserve Other changes in capital surplus Balance at December 31, 2019 Profit Other comprehensive income Total comprehensive income Appropriation and distribution of retained earnings: Legal reserve appropriated Cash dividends of ordinary share Reversal of special reserve Other changes in capital surplus Balance at December 31, 2020	Share capital Ordinary shares Capital surplus	Retained earnings
		Legal reserve Special reserve Unappropriate d retained earnings Total retained earnings
	- - - - 2,063,955 2,063,955 - - - 2,063,955 - - - - (779) (779) (160,615) 195,108 34,493 33,714
	- - - - 2,063,176 2,063,176 (160,615) 195,108 34,493 2,097,669
	- - 228,131 - (228,131) - - - - - - - - - (2,156,000) (2,156,000) - - - (2,156,000) - - - (86,838) 86,838 - - - - - - 438 - - - - - - - 438
	9,800,000 2,244,073 3,191,153 31,147,849 2,994,828 37,333,830 (51,551) 1,398,701 1,347,150 50,725,053 - - - - 2,452,881 2,452,881 - - - 2,452,881 - - - - (17,820) (17,820) (411,089) 715,107 304,018 286,198
	- - - - 2,435,061 2,435,061 (411,089) 715,107 304,018 2,739,079
	- - 206,396 - (206,396) - - - - - - - - - (2,156,000) (2,156,000) - - - (2,156,000) - - - (324,202) 324,202 - - - - - - 579 - - - - - - - 579
	$ 9,800,000 2,244,652 3,397,549 30,823,647 3,391,695 37,612,891 (462,640) 2,113,808 1,651,168 51,308,711

See accompanying notes to parent company only financial statements.

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Statements of Cash Flows

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) operating activities: Profit before tax Adjustments: Adjustments to reconcile profit (loss): Depreciation expense Amortization expense Net gain on financial assets or liabilities at fair value through profit or loss Interest expense Interest income Dividend income Share of profit of subsidiaries,associates and joint ventures accounted for using equity method (Gain) loss on disposal of property, plant and equipment, net Gain on disposal of investment properties Unrealized foreign currency exchange loss Loss on disposal of investments Donation expense Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Changes in operating assets: Decrease (increase) in notes receivable Decrease (increase) in accounts receivable Decrease (increase) in other receivable Decrease (increase) in inventories Decrease (increase) in prepayments Decrease (increase) in other current assets Total changes in operating assets Changes in operating liabilities: Increase (decrease) in contract liabilities Increase (decrease) in notes payable Increase (decrease) in accounts payable Increase (decrease) in other payable Increase (decrease) in receipts in advance Increase (decrease) in other current liabilities Increase (decrease) in net defined benefit liability Increase (decrease) in deferred credits Total changes in operating liabilities Total changes in operating assets and liabilities Total adjustments Cash inflow generated from operations Interest received Dividends received Interest paid Income taxes refund (paid) Net cash flows from (used in) operating activities	For the years ended December 31 2020 2019 $ 2,964,183 2,463,207 1,024,419 993,158 6,524 6,661 (5,065) (9,926) 3,581 4,089 (37,684) (75,204) (41,776) (41,806) (623,979) (721,671) (1,025) 21 (1,047,961) (15,405) 1,597 624 - 108 10,075 19,532	For the years ended December 31 2020 2019 $ 2,964,183 2,463,207 1,024,419 993,158 6,524 6,661 (5,065) (9,926) 3,581 4,089 (37,684) (75,204) (41,776) (41,806) (623,979) (721,671) (1,025) 21 (1,047,961) (15,405) 1,597 624 - 108 10,075 19,532
	2020 $ 2,964,183 1,024,419 6,524 (5,065) 3,581 (37,684) (41,776) (623,979) (1,025) (1,047,961) 1,597 - 10,075
	(711,294)	160,181
	76,354 88,973 4,031 (380,104) (170,435) (5,463)	(12,130) 292,938 1,562 365,271 415,524 753
	(386,644)	1,063,918
	(22,745) (8,959) (153,149) 13,260 292,494 4,016 (11,983) (390,367)	(60,936) 10,019 (149,391) (105,563) 9,306 (3,070) (11,159) (392,092)
	(277,433)	(702,886)
	(664,077)	361,032
	(1,375,371)	521,213
	1,588,812 39,026 234,284 (3,581) (554,572)	2,984,420 75,347 1,324,413 (4,089) (674,168)
	1,303,969	3,705,923

7-1

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Statements of Cash Flows (CONT ’ D)

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from (used in) investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of financial assets designated at fair value through profit or loss Proceeds from disposal of financial assets designated at fair value through profit or loss Acquisition of investments accounted for using equity method Proceeds from disposal of subsidiaries Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Decrease (increase) in refundable deposits Decrease in other receivables Acquisition of intangible assets Acquisition of investment properties Proceeds from disposal of investment properties Decrease (increase) in other financial assets Increase in other non-current assets Net cash flows from (used in) investing activities Cash flows from (used in) financing activities: Increase (decrease) in guarantee deposits received Payment of lease liabilities Cash dividends paid Net cash flows from (used in) financing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2020 (150,000) 98,000 (5,710,000) 5,975,233 (500,000) - (197,718) 1,039 30,514 15,680 (2,230) (2,515,774) 1,422,740 3,225,104 -	2019 - 2,927 (1,826,799) 2,083,118 (10,000) 9,301 (383,438) 225 (785) 129,375 - (1,065,641) 22,826 (994,928) (420)
	1,692,588	(2,034,239)
	29,552 (27,245) (2,156,000)	(24,380) (26,195) (2,156,000)
	(2,153,693)	(2,206,575)
	842,864 1,678,358	(534,891) 2,213,249
	$ 2,521,222	1,678,358

See accompanying notes to parent company only financial statements.

Ratification No. 2

Subject: The Company’s 2020 earnings distribution is submitted for ratification,brought forth for your ratification.

Submitted by the Board of Directors

Remark:

I. The Company’s financial statements from January 1, 2020 to December 31, 2020 have been audited by CPAs, and the net profit after tax of the year is NTD 2,452,881,251.
II. The 2020 settled earnings after tax and the undistributed earnings are intended to be distributed as following:
(I) 10% appropriated as legal reserve:
- On the basis of the net profit after tax of the year is NTD 2,452,881,251, the re-measurement of defined benefit plan accounted as retained earnings of NTD 17,819,693 is deducted, and the reversal recognized a special reserves by TIFRS for the first time of NTD 324,201,146 is added. 10% of such balance is appropriated as legal reserve, for NTD 275,926,270.
(II) Bonus disttribution.
- On the basis of the net profit after tax of the year is NTD 2,452,881,251, the undistributed earnings after adjustment of NTD 938,814,049 is added, and the legal reserve of NTD 275,926,270 and the undistributed earnings at the end of the period of NTD 861,769,030 are deducted. The balance of NTD 2,254,000,000 will be distributed as the shareholders’ bonus in cash for NTD 2.3 per share.
III. The proposal has been reviewed by the Audit Committee in the 18th meeting, 1st Term on March 25, 2021, and approved by the Board of Directors in the 27th meeting, 34th Term on March 25, 2021. Upon the approval of the AGM, the Board of Directors is authorized to determine the base date of dividend. In addition, before the base date of dividend distribution to shareholders, in case of any buyback or transfer, conversion, write-off of treasury shares as indicated in Article 28-2 of the Securities and Exchange Act, that affect the total outstanding shares and thus the dividend yield changes, the Board of Directors is fully authorized to handle this.
IV. The aggregation information regarding the actual receivers of employees’ remuneration and the amounts of the previous year (2019) is disclosed in the Company’s annual report and MOPS.
V. As the Company do not prepare financial forecast nor distribute bonus share, the effect of bonus share on the Company’s performance, EPS, and ROI of shareholders are not applicable.
VI. Attached please find the Company’s 2020 earnings distribution table (see later)

Resolution: THAT the above is approved by ordinary resolution,

The voting rights of the attending shareholders when voting: 570,834,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 520,234,597 rights 91.13% (electronic votes of 222,084,150 rights included)

Votes against: 302,924 rights 0.05% (electronic votes of 302,924 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 50,296,624 rights 8.80% (electronic votes of 17,023,604 rights included)

Attachment

TAIWAN FERTILIZER CO., LTD. EARNINGS DISTRIBUTION TABLE

2020

TAIWAN FERTILIZER CO., LTD. EARNINGS DISTRIBUTION TABLE 2020	Attachment	Attachment
	Unit: NTD＄
Items	Amount	Remarks
I. Intended Distribtuion: Undistributed earnings at the beginning of the period Reversal recognized a special reserves by TIFRS for the first time Remeasurement of defined benefit plan accounted as retained earnings Undistributed earnings after adjustment Net profit after tax of the year Appropriation for legal reserve (10%) Distributable earnings of the period II. Distribution Items: Dividend to shareholders- cash (NTD 2.3 per share X 980,000,000 shares) Undistributed earnings at the end of the period	632,432,596 324,201,146 -17,819,693	Note 1 Note 2
	938,814,049 2,452,881,251 -275,926,270
	3,115,769,030 -2,254,000,000
	861,769,030
Notes: (1) The undistributed earnings at the beginning of the period is the amount of the “undistributed earnings at the end of the period” listed on the 2019 Earnings Distribution Table approved by the 2020 AGM. (2) The earnings of 2020 will be distributed first. (3) The total frictions of cash dividends under NTD 1 will be listed as the other income of the Company.

Note 1: Article 237, paragraph 1, the Company Act

(1) A company, when allocating its surplus profits after having paid all taxes and dues, shall first set aside ten percent of said profits as legal reserve. Where such legal reserve amounts to the total paid-in capital, this provision shall not apply.
(2) When appropriating the legal reserve, it was handled pursuant to the Letter Jing-Shan-Zhi No. 10802432410 and No. 10902005780 by MOEA.

Note 2: Article 25, Paragraph 3, the Articles of Incorporation

In case where the Company have surplus profit after settling the annual accounts, when allocating its surplus profits after having paid all taxes and dues, shall first set aside ten percent of said profits as legal reserve, and appropriate or reverse the special reserves as required by laws. The sum of such balance with the accumulated undistributed earnings from the previous year is deemed the distributable earnings. However, the special reserves may be reserved or appropriated as the operation requires, and the Board of Directors will propose the earnings distribution to the AGM to distributing bonus to shareholders.

IV. Discussion and Election Items

Discussion and Election Items 1.

Cause: The amendments to the Company's “Rules of Procedure for Shareholders Meetings” in part, please vote.

Submitted by the Board of Directors

Remark:

I. Amended to cope with the announcement of TWSE with Letter Tai-ZhengZhi-Li-Zhi No. 1100001446, dated January 28, 2021, regarding the “Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings.”
II. The comparison table for amendments to the “Rules of Procedure for Shareholders Meetings of Taiwan Fertilizer Co., Ltd.” in part is enclosed herewith (see Attachment).
Resolution: THAT the above is approved by ordinary resolution.( As the AGM of this year was delayed due to the pandemic, the amendment date of the Rules of Procedure for Shareholders’ Meetings is amended to July 28, 2021, the actual meeting date.)

The voting rights of the attending shareholders when voting: 570,834,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 520,342,656 rights 91.15% (electronic votes of 222,192,209 rights included) Votes against: 145,258 rights 0.02% (electronic votes of 145,258 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 50,346,231 rights 8.81% (electronic votes of 17,073,211 rights included)

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The comparison table for amendments to the “Rules of Procedure for Shareholders Meetings of Taiwan Fertilizer Co., Ltd.” in part is enclosed herewith.1

Amended Provision	Current Provision	Remark
Article 9 The chair shall call the meeting to order at the appointed meeting time, while announcing the related	Article 9 The chair shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month. 2nd paragraph omitted	Amended to cope with the announcement of TWSE with Letter Tai-Zheng-Zhi-Li-Zhi No. 1100001446, dated January 28, 2021, regarding the “Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings.”
information of shares without
voting rights and attending
shares. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders meeting shall be convened within one month. 2ndparagraph omitted
Article 17 1st paragraph omitted Matters pertaining to election or discharge of directors and independent	Article 17 1st paragraph omitted Matters pertaining to election or discharge of directors and independent directors,	Amended to cope with the announcement of TWSE with Letter Tai-Zheng-Zhi-Li-Zhi

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	directors, alteration of the Articles of Incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, dissolution, merger, spin- off, or any matters as set forth in Paragraph I, Article 185,Article 26-1 and 43-6 of the Securities and Exchanges Act, and Article 56-1 and 60-2 of the Regulations Governing the Offering and Issuance of Securities by Securities Issuershereof, shall be itemized in the causes or subjects to be described and the essential contents shall be explained in the notice to convene a meeting of shareholders, and shall not be brought up as extemporary motions. Omitted hereafter		alteration of the Articles of Incorporation, reduction of capital, application for the approval of ceasing its status as a public company, approval of competing with the company by directors, surplus profit distributed in the form of new shares, reserve distributed in the form of new shares, dissolution, merger, spin-off, or any matters as set forth in Paragraph I, Article 185 hereof shall be itemized in the causes or subjects to be described and the essential contents shall be explained in the notice to convene a meeting of shareholders, and shall not be brought up as extemporary motions; the essential contents may be posted on the website designated by the competent authority in charge of securities affairs or the company, and such website shall be indicated in the above notice. Omitted hereafter	No. 1100001446, dated January 28, 2021, regarding the “Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings.”
	Article 20 Election of directors and independent directors, shall comply with the Company Act, related laws and regulations, and the Company’s procedures of elections. The result shall be announced onsite, including the names of the elected directors and independent directors, and their votes,as well as the names and votes of these directors and independent directors not elected. 2ndparagraph omitted		Article 20 Election of directors and independent directors, shall comply with the Company Act, related laws and regulations, and the Company’s procedures of elections. The result shall be announced onsite, including the names of the elected directors and independent directors, and their votes. 2nd paragraph omitted	Amended to cope with the announcement of TWSE with Letter Tai-Zheng-Zhi-Li-Zhi No. 1100001446, dated January 28, 2021, regarding the “Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings.”

37 -

Discussion and Election Items 2.

Cause: The amendments to the Company's “Procedures of Electing Directors and Independent Directors” in part, please vote.

Submitted by the Board of Directors

Description:

Amended to cope with the announcement of TWSE with Letter Tai-ZhengZhi-Li-Zhi No. 1090009468, dated June 3, 2020, regarding the “Sample Template for XXX Co., Ltd. Procedures for Election of Directors.”
The comparison table for amendments to the “Procedures for Election of Directors and Independent Directors of Taiwan Fertilizer Co., Ltd.” (see later).

Resolution: THAT the above is approved by ordinary resolution.( As the AGM of this year was delayed due to the pandemic, the amendment date of the "Procedures for Election of Directors and Independent Directors" is amended to July 28, 2021, the actual meeting date.)

The voting rights of the attending shareholders when voting: 570,834,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 516,295,268 rights 90.44% (electronic votes of 218,144,821 rights included) Votes against: 140,487 rights 0.02% (electronic votes of 140,487 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 54,398,390 rights 9.52% (electronic votes of 21,125,370 rights included)

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The comparison table for amendments to the “Procedures of Electing Directors and Independent Directors,” Taiwan Fertilizer Co., Ltd.

	Amended Provision		Current Provision	Remark
	Article 5 Ballots are printed by the Board of Directors, and each attending shareholder is given one ballot with the attendance card number with the number of voting rights printed on it. Voters specified the name or account nameof the candidate; however, if a governmental agency or institution is a candidate, the name of such governmental agency or institution shall be specified, or the name of governmental agency or institution and the name of the representative. If there are several representatives, each of their name shall be specified.		Article 5 Ballots are printed by the Board of Directors, and each attending shareholder is given one ballot with the attendance card number with the number of voting rights printed on it. Voters specified the name or account nameof the candidate; if the candidate is not a shareholder, the name and the ID number/Uniform number of the candidate shall be specified.However, if a governmental agency or institution is a candidate, the name of such governmental agency or institution shall be specified, or the name of governmental agency or institution and the name of the representative. If there are several representatives, each of their name shall be specified.	Amended to cope with the announcement of TWSE with Letter Tai-Zheng-Zhi-Li-Zhi No. 1090009468, dated June 3, 2020, regarding the “ Sample Template for XXX Co., Ltd. Procedures for Election of Directors.”
	Article 7 A ballot is invalid under any of the following circumstances; the voting rights indicated in the ballot must not counted under the candidate(s) specified in the ballot: 1. Attendance registration is not completed. 2. The ballot was not prepared bya person with the right to convene. 3. The writing is unclear and indecipherable . 4. Candidates specified more than the seats to be elected. 5. The sum of the votes to each candidate is more than the total voting rights. 6. The texts in the ballot are altered,or texts other than the		Article 7 A ballot is invalid under any of the following circumstances; the voting rights indicated in the ballot must not counted under the candidate(s) specified in the ballot: 1. Attendance registration is not completed. 2. The ballot was not prepared bythe Company’s Board of Directors. 3. The writing is unclear and indecipherable . 4. Candidates specified more than the seats to be elected. 5. The sum of the votes to each candidate is more than the total voting rights. 6. The texts in the ballot are altered,or texts other than the	Amended to cope with the announcement of TWSE with Letter Tai-Zheng-Zhi-Li-Zhi No. 1090009468, dated June 3, 2020, regarding the “ Sample Template for XXX Co., Ltd. Procedures for Election of Directors.”

39 -

	required one are included. 7. The ballot is not placed in the ballot box, or the placed ballot is blank. 8. The information of the specified candidate(s) does not conform to thedirector candidate (independent directors included) list.		required one are included. 7. The ballot is not placed in the ballot box, or the placed ballot is blank. 8. The information of the specified candidate(s) arenot specified as required in Article 5,or inconsistent after checking.
	Article 11 These Procedures, and any amendments hereto, shall be implemented after approval by a shareholders meeting.		Article 11 These Procedures, and any amendments hereto, shall be implemented after approval by a shareholders meeting. The deletion of provisions about supervisors referred to herein shall become effective as of the date when the Audit Committee is established.	The Company has established the Audit Committee, and thus adjusted and deleted the content of this Article.

40 -

Discussion and Election Items 3.

Cause: Election of the Company’s 35th Board of Directors (including independent directors). Please elect.

Submitted by the Board of Directors

Description:

The term of office for the directors (independent directors included) of 34th Term will expire on June 30, 2021. Pursuant to the Articles of Incorporation of the Company, the full re-election shall be held in this (2021) General Shareholders’ Meeting.
Pursuant to Article 16 and Article 16-1 of the Articles of Incorporation, the Company establishes nine directors, including three independent directors. The election of directors (independent directors included) adopts the candidate nomination system. Shareholders shall elect from the candidate list, both for directors and independent directors, while the seats of elected are counted separately.
Nine seats of directors (three seats of independent directors included) are intended to be elected in this General Shareholders’ Meeting. The term of office is three years, from July 1, 2021 to June 30, 2024.
The election for directors of 35th Term adopts the candidate nomination system. The candidate list has been approved in the 28th meeting of the Board of Directors of 34th Term, specified as following:
Please elect

Resolution: (As the AGM of this year was delayed due to the pandemic, the term of the current directors and independent directors started from July 28, 2021 to July 27, 2024, for three years.)

Candidates category	Name	Representive	Voting Rights	Vote
Director	Council of Agriculture, Executive Yuan	Huang Yao-Hsing	829,345,659	elected
Director	Council of	Hu Jong-I	481,901,307	elected

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	Agriculture, Executive Yuan
Director	Council of Agriculture, Executive Yuan	Fan Mei-Ling	481,586,576	elected
Director	Council of Agriculture, Executive Yuan	Tai, Ko-Yuan	481,510,555	elected
Director	Council of Agriculture, Executive Yuan	Hsu, Min-Lin	481,274,228	elected
Director	Tsao, Chi-Hung		226,134,516	elected
Independent Director	Lin, Su-Ming		456,420,064	elected
Independent Director	Ho Yen-Sheng		457,305,664	elected
Independent Director	Weng Ming-Jang		456,991,574	elected

42 -

Candidate List of Directors/Independent Directors of Taiwan Fertilizer Co., Ltd.

Serial No.	Name of Candidate	Name of Candidate	Major Educational and Professional Background	Number of Share Held
1	Director	Council of Agriculture, Executive Yuan Representative: Huang Yao-Hsing	PhD, Department of Materials Science, National Sun Yat-sen University General Manager, Taiwan Fertilizer; Deputy General Manager and Chief of Taichung Factory, Taiwan Fertilizer; Assistant Deputy General Manager of Taiwan Fertilizer; Chief of Sales Dept, Taiwan Fertilizer; Chief of Factory Dept, Chief of Hsin Chu and Miaoli Factory, Taiwan Fertilizer. Current position: Chairman and General Manager, Taiwan Fertilizer Co.,Ltd.	235,886,376
2	Director	Council of Agriculture, Executive Yuan Representative: Hu Jong-I	PhD, Agricultural Economics, The University of Tokyo Chief Secretary, Council of Agriculture, Executive Yuan; Chief, Department of Farmer’s Service, Council of Agriculture, Executive Yuan Current position: Director General, Agriculture and Food Agency, Council of Agriculture,Executive Yuan	235,886,376
3	Director	Council of Agriculture, Executive Yuan Representative: Fan Mei-Ling	PhD, Natural Resources Administration, National Dong Hwa University Hualien District Agricultural Research and Extension Station, Council of Agriculture, Executive Yuan; Department of Farmer’s Service, Council of Agriculture, Executive Yuan Current position: Chief Secretary, Council of Agriculture,Executive Yuan	235,886,376
4	Director	Council of Agriculture, Executive Yuan Representative: Tai,Ko-Yuan	Master, Department of Aquaculture, National Pingtung University of Science and Technology Researcher,National	235,886,376

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			Museum of Marine Biology and Aquarium; Chief, Hairy Crab Farm; President of Dalin Branch, Chiayi County Young Farmer Association; Vice President, Chiayi County Young Farmer Association. Current position: Xin Mei Florist
5	Director	Council of Agriculture, Executive Yuan Representative: Hsu, Min-Lin	Department of Tourism, Chinese Culture University Executive Secretary, Employee Welfare Committee, Taiwan Fertilizer; Member of Occupational Safety and Health, Taiwan Fertilizer Current position: Senior Coordinator, Taiwan Fertilizer	235,886,376
6	Director	Tsao, Chi-Hung	Completion, Education Institute, National Kaohsiung Normal University; Department of Russian Language and Literature, Chinese Culture University Chairman, Foundation of Taiwan Sugar Association; Minister, Council of Agriculture, Executive Yuan; County Mayor, Pingtung County; Member of 4th and 5th Term, Legislative Yuan; Convener, Education and Culture Policy Panel of DDP, Legislative Yuan Current position: Chairman, Dawu Mountain Foundation; Independent Director, Sun Rise E&T Corporation	0
7	Independent Director	Lin, Su-Ming	PhD of Accounting, Arizona State University Dean, Department and Institute of Accounting, National Taiwan University; Independent Director, Nan Shan Life Co., Ltd.; Independent Director, Ruentex Industries Limited; Director, iPass Corporation (Representative of National	0

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			Development Fund); Director, China Airlines (Representative of National Development Fund); Consultant, National Federation of CPA Associations of the R.O.C. Current position: Professor, Department of Accounting, National Taiwan University
8	Independent Director	Ho Yen-Sheng	PhD, Department of Real Estate and Built Environment, National Taipei University; PhD Candidate, Institute of Geodesy and Geoinformation, University of Bonn Member, Legal Affairs Committee; Member, Deliberation Panel, Urban Renewal and Dispute Handling, Taipei City; Member, Deliberation Panel, Urban Renewal and Dispute Handling, Taichung City; Member, Realtor Reward and Punishment Committee, Taichung City; Member, Real Estate Dispute Mediation Committee, Taichung City Current position: Associate Professor, Department of Land Management, Feng Chia University	0
9	Independent Director	Weng Ming-Jang	PhD of Economics, Texas A&M University Independent Director, Sheh Fung Screws Co., Ltd; Independent Director, Perfect Medical Ind. Co., Ltd.; Visiting Scholar, Department of Finance and Banking, Universiti Malaya; Chief, Extension Education Center, National Kaohsiung University; Part-Time Associate Professor, Department of Business Administration, National KaohsiungUniversityof	0

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Science and Technology; Chief, EMBA Center, National Kaohsiung University Current position: Associate Professor, Department of Applied Economics, National Kaohsiung University

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Discussion and Election Items 4

Cause: Proposal to release the institutional shareholder of the 35th term, Council of Agriculture, Executive Yuan, from the non-compete restrictions

Submitted by the Board of Directors

Description:

Pursuant to Article 209 of the Company Act, a director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.
Pursuant to the explanation in the Letter Shang No.89206938 issued by the MOEA on April 24, 2000, and according to Article 27, Item 2 of the Company Act, when an institutional shareholder designated representatives as the elected directors, the designated representatives and the institutional shareholder shall be subject to the non-competition restrictions imposed on directors, to comply with the intention of Article 209 of the Company Act.
Please release the institutional shareholder from the non-competition restrictions for the following business :

restrictions for the following business	:
Name of the institutional shareholder	Council of Agriculture, Executive Yuan
Company concurrently serves in	Taipei Agricultural Products Marketing Co., Ltd.
Position concurrently serves as	Institutional director
Major business	Supermarkets International Trade. Restaurants Parking area Operators Warehousing

The proposal has been approved in the 28th Meeting, Board of Directors of 34th Term, and submitted to the AGM for vote.

Resolution: THAT the above is approved by special resolution.

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The voting rights of the attending shareholders when voting: 334,951,769 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 278,776,140 rights 83.21% (electronic votes of 216,512,069 rights included) Votes against: 854,423 rights 0.25% (electronic votes of 854,423 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 55,321,206 rights 16.51% (electronic votes of 22,044,186 rights included)

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Discussion and Election Items 5.

Cause: Proposal to release the candidate of director of the 35th term, Tsao, Chi-Hung, from the non-compete restrictions. Please vote.

Submitted by the Board of Directors

Description:

Pursuant to Article 209 of the Company Act, a director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.
Please release Tsao, Chi-Hung, the Director of 35th term, from the noncompetition restrictions for the following business :

Director	Tsao, Chi-Hung
Company concurrently serves in	Sun Rise E&T Corporation
Position concurrently serves as	Independent Director
Major business	Wholesale of Chemical Feedstock Retail Sale of Chemical Feedstock International Trade.

The proposal has been approved in the 28th Meeting, Board of Directors of 34th Term, and submitted to the AGM for vote.

Resolution: THAT the above is approved by special resolution.

The voting rights of the attending shareholders when voting: 570,838,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 504,705,051 rights 88.41% (electronic votes of 206,554,604 rights included) Votes against: 1,204,172 rights 0.21% (electronic votes of 1,204,172 rights included)

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Invalid rights: 0 right	0%
Abstained and un-voted rights: 64,928,922 rights (electronic votes of 31,651,902 rights included)	11.36%

50 -

Discussion and Election Items 6

Cause: Proposal to release the candidate of independent director of the 35th term, Lin, Su-Ming, from the non-compete restrictions. Please vote.

Submitted by the Board of Directors

Description:

Pursuant to Article 209 of the Company Act, a director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.
Please release Lin, Su-Ming, the Independent Director of 35th term, from the non-competition restrictions for the following business :

Independent Director	Lin, Su-Ming
Company concurrently serves in	Ruentex Industries Limited
Position concurrently serves as	Independent Director
Major business	Wholesale of Cosmetics Retail Sale of Fertilizer Retail Sale of Environmental Agents Retail Sale of Cosmetics Department Stores Supermarkets International Trade. Restaurants Parking area Operators Warehousing Housing and Building Development and Rental Industrial Factory Development and Rental

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The proposal has been approved in the 28th Meeting, Board of Directors of 34th Term, and submitted to the AGM for vote.

Resolution: THAT the above is approved by special resolution.

The voting rights of the attending shareholders when voting: 570,838,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 504,836,005 rights 88.43% (electronic votes of 206,685,558 rights included) Votes against: 914,920 rights 0.16% (electronic votes of 914,920 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 65,087,220 rights 11.39% (electronic votes of 31,810,200 rights included)

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Discussion and Election Items 7.

Cause: Proposal to release the candidate of independent director of the 35th term, Weng, Ming-Jang, from the non-compete restrictions. Please vote.

Submitted by the Board of Directors

Description:

Pursuant to Article 209 of the Company Act, a director who does anything for himself or on behalf of another person that is within the scope of the company's business, shall explain to the meeting of shareholders the essential contents of such an act and secure its approval.
Please release Weng, Ming-Jang, the Independent Director of 35th term, from the non-competition restrictions for the following business :

Independent Director	Weng, Ming-Jang
Company concurrently serves in	Sheh Fung Screws Co., Ltd	Perfect Medical Ind. Co., Ltd.
Position concurrently serves as	Independent Director	Independent Director
Major business	International Trade.	Wholesale of Alcohol Wholesale of Other Chemical Products Wholesale of Cosmetics Retail Sale of Alcohol Retail Sale of Other Chemical Products Retail Sale of Cosmetics Warehousing Waste Disposing Waste Treatment

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The proposal has been approved in the 28th Meeting, Board of Directors of 34th Term, and submitted to the AGM for vote.

Resolution:THAT the above is approved by special resolution.

The voting rights of the attending shareholders when voting: 570,838,145 rights.

Percentage of the voting rights of Voting Results the attending shareholders Votes favorable: 504,715,636 rights 88.41% (electronic votes of 206,565,189 rights included) Votes against: 996,340 rights 0.17% (electronic votes of 996,340 rights included) Invalid rights: 0 right 0% Abstained and un-voted rights: 65,126,169 rights 11.39% (electronic votes of 31,849,149 rights included)

V. Motions ： None

VI. Dismissed of the meeting ： The meeting was adjourned.

54 -

AI assistant

TFC — AGM Information 2021

51902_rns_2021-08-13_01998867-1de4-484e-a504-635be3eff20d.pdf

TAIWAN FERTILIZER CO., LTD.

2021 Annual General Shareholders’ Meeting Minutes

TAIWAN FERTILIZER CO., LTD. 2021 Annual General Shareholders’ Meeting Minutes

I. Chairman’s Address : (Omitted)

II. Reported Items

Report No. 1

Description

Business Report

1. Foreword:

2. Overview of Business:

(I) Production and marketing :

(II) Operating revenue and profit:

1. Parent-only financial statement

2. Consolidated financial statements

(III) Financial structure:

1. Parent-only financial statement

(IV) Investment plan:

III. Outlook

Report No. 2

Audit Report of the Audit Committee

Report No. 3

Report No. 4

Description

Code of Ethical Conduct for the Company's Directors and the Highest-level Executives and above of Taiwan Fertilizer Co., Ltd.

III. Ratification Items

Ratification No. 1

TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Financial Statements

Table of contents

Representation Letter

Independent Auditors ’ Report

Opinion

Basis for Opinion

Key Audit Matters

Key audit matters:

How the matter was addressed in our audit:

Other Matter

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

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Notes to Readers

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars , Except for Earnings Per Common Share)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2020 and 2019

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD. AND SUBSIDIARIES

Consolidated Statements of Cash Flows (CONT ’ D)

For the years ended December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

TAIWAN FERTILIZER CO., LTD.

Table of contents

Independent Auditors ’ Report

Opinion

Basis for Opinion

Key Audit Matters

Key audit matters:

How the matter was addressed in our audit:

Other Matter

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

Auditors ’ Responsibilities for the Audit of the Financial Statements

Notes to Readers

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

Balance Sheets

December 31, 2020 and 2019

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN FERTILIZER CO., LTD.

TFC AGM Information 2021