TMC — Annual Report 2023

Jun 12, 2024

==> picture [109 x 102] intentionally omitted <==

Stock Code: 2338

Taiwan Mask Corporation

2023

Annual Report

Date of publication: March 31, 2024

Website of Market Observation Post System: http://mops.twse.com.tw Website to access the annual report of Taiwan Mask Corporation: https://www.tmcnet.com.tw/tw/Investors/AnnualReports

• I. Spokesperson of the Company Name: Eve Yang Job title: Chief Financial Officer Telephone: (03) 563-4370 Email: eve_yang@tmcnet.com.tw

Acting Spokesperson: Name: LC Lin Job title: Director, IT Department Telephone: (03) 563-4370 Email: lclin@tmcnet.com.tw

• II. Headquarters, branch office, factory address and telephone Headquarters: No. 11, Innovation Rd.1, Science-Based Industrial Park, Hsinchu Branch company: None Factory: No. 11, Innovation Rd.1, Science-Based Industrial Park, Hsinchu Telephone: (03) 563-4370 Fax: (03) 578-0752

• III. Stock transfer agent

• Name: Shareholder Services Department of Grand Fortune Securities Address: 6F., No. 6, Section 1, Zhongxiao West Road, Zhongzheng District, Taipei City Website: https://www.gfortune.com.tw/Static/ 股務代理部 /index.html Telephone: (02)2371-1658

• IV. Certified Public Accountant (CPA) and firm for the latest financial report Name: Ya-Hui Cheng (CPA), Chien-Yu Liu (CPA) Accounting Firm: PricewaterhouseCoopers Taiwan Address: 27F, No. 333, Section 1, Keelung Road, Xinyi District, Taipei City Website: https://www.pwc.com.tw Telephone: (02) 2729-6666

• V. Name of overseas exchange where securities are listed, and method of inquiry: Not applicable.

• VI. Company’s website: http://www.tmcnet.com.tw

Taiwan Mask Corporation Annual Report Table of Contents

One. Report	to Shareholders ............................................................................................................. 1
Two. Company Profile ....................................................................................................................... 4
Three. Corporate Governance Report ............................................................................................. 9
I.	Organizational Structure ............................................................................................ 9
II.	Information on Directors, General Manager, Vice General Managers .................... 11
III.	Remuneration paid during the most recent fiscal year to directors of the board
	(including independent directors), the general manager, and vice general managers
	.................................................................................................................................. 18
IV.	Implementation status of corporate governance ...................................................... 24
V.	Information on professional fee of accountant......................................................... 71
VI.	Information on change of accountants ..................................................................... 71
VII.	Information on the chairman, general manager, manager in charge of financial or
	accounting affairs of the Company who has worked in the accounting firm or an
	affiliated company of the certified accountant for the past one year ....................... 71
VIII.	Status of any equity transferred and changes in pledge of stock rights in recent
	years and until the publication date of the annual report by directors, independent
	directors, managers and shareholders with over 10% shares ................................... 72
IX.	Top ten shareholders by shareholding proportion and information of relationships
	among them .............................................................................................................. 74
X.	Company, company’s directors, managers and businesses in direct or indirect
	control by the company, their number of shares of the reinvested businesses, and the
	consolidated calculation of the comprehensive shareholding ratio.......................... 74
Four. Financing Activities ................................................................................................................ 75
I.	Capital and shares .................................................................................................... 75
II.	Handling situation of corporate bonds ..................................................................... 82
III.	Preferred shares ........................................................................................................ 85
IV.	Overseas depositary receipts .................................................................................... 85
V.	Employee stock warrants and employee new restricted shares ............................... 85
VI.	Merger or acquisition, issue of new shares in connection with the acquisition of
	shares of another company ....................................................................................... 85
VII.	Financing plans and implementation ....................................................................... 85
Five. Overview of operations........................................................................................................... 86
I.	Business Activities ................................................................................................... 86
II.	Status of the market and production/sales ................................................................ 88

III.	Employee information .............................................................................................. 93
IV.	Expenditures on environmental protection .............................................................. 93
V.	Labor relations information...................................................................................... 95
VI.	Important contracts................................................................................................... 96
Six. Overview	of Financial Status ................................................................................................... 97
I.	Information on condensed balance sheets and statements of comprehensive income
	for the past five fiscal years ..................................................................................... 97
II.	Financial analysis for the most recent five fiscal years.......................................... 101
III.	Audit Committee’s audit report of the Financial Statements for the most recent
	fiscal year ............................................................................................................... 105
IV.	Parent-only financial statements for the most recent fiscal year (2023) audited and
	attested by certified public accountants ................................................................. 107
V.	Consolidated financial statements for the most recent fiscal year (2023) audited and
	attested by certified public accountants ................................................................. 107
VI.	If the company or its affiliates have experienced financial difficulties in the most
	recent fiscal year or during the current fiscal year up to the date of publication of
	the annual report, the annual report shall explain how said difficulties will affect the
	company's financial situation ................................................................................. 107
Seven. Review	and Analysis of Financial Position and Financial Performance and Risks ..... 108
I.	Financial position ................................................................................................... 108
II.	Financial performance ............................................................................................ 109
III.	Cash flow ............................................................................................................... 110
IV.	Effects of major capital expenditures on finance and operation in the most recent
	fiscal year ............................................................................................................... 110
V.	The Company’s reinvestment policy for the most recent fiscal year, the main
	reasons for the generated profits/losses, the plan for improving re-investment
	profitability and investment plans for the coming year ......................................... 111
VI.	Analysis and assessment of risks ........................................................................... 112
VII.	Other important matters ......................................................................................... 115
Eight. Special	Items to be Included .............................................................................................. 116
I.	Information of affiliated companies ....................................................................... 116
II.	Status of private placement of securities during the most recent fiscal year and up to
	the date of publication of the annual report ........................................................... 122
III.	Holding or disposal of shares in the Company by the Company’s subsidiaries
	during the most recent fiscal year and up to the date of publication of the annual
	report ...................................................................................................................... 122
IV.	Other supplementary information .......................................................................... 122

• V. Situations listed in Article 36, Paragraph 2, Subparagraph 2 of the Securities and Exchange Act, which might materially affect shareholders' equity or the price of the company’s securities, have occurred during the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report, such situations shall be listed .......................................................................................................... 122

Attachment

• Attachment 1. Standalone financial statement for the most recent fiscal year audited and attested by certified public accountants .............................................................. 1-100

• Attachment 2. Consolidated financial statement for the most recent fiscal year audited and attested by certified public accountants ............................................................. 1~102

One. Report to Shareholders

To begin with, I would like to express my appreciation to all shareholders for their support. Under the impacts from continuous international turbulence (geopolitics, the Russia-Ukraine war, the IsraelPalestine conflict) and inflationary factors, governments around the world have to combat inflationary pressure and sluggish consumption after the lockdowns are lifted. The destocking speed of the global semiconductor and electronics industries is not as good as expected. Although there is the topic of AI applications, under the slowdown of demand for consumer products with a large proportion of semiconductors, the scale of the global semiconductor market declined in 2023. However, it is fortunate that the global semiconductor industry will return to growth in 2024 and a double-digit growth is expected. Overall, the difference between semiconductor process technologies and applications will result in a different end demand. In this regard, TMC has a sound positioning, prudently planned to build new capacity and new technologies to cope with the overall demand in a timely and appropriate manner. The Company continuously strengthen operational management efficiency, deepen customer relationship management and services, for constantly growing with strategic customers. Other than the core business of photomask growing and expanding the strategic positioning, the subsidiaries of the Group also focus on the development of their own core businesses, while expanding related businesses with synergies, recruiting key talents to join in the expansion of new businesses and implement the execution strategies, seeking to constantly create value for shareholders with a stable positioning.

The operating results of TMC for 2023 are summarized as follows:

Operation and Finance

In 2023, the consolidated revenue of TMC was NT$7.2 billion, down 7% from the previous year. However, we continue to upgrade technology, expand capacity, and improve quality. Through strengthening organizational functions and reforming management systems, we effectively shorten delivery time and improve customer satisfaction; we also have a robust deployment and increase highend photomask manufacturing services to expand our photomask OEM services with strategic partners, and deepen cooperation with strategic partners.

1. 2023 consolidated revenue and net income, and the comparison with 2022:

Unit: NT$Thousand

			Unit: NT$Thousand
General ledger account	2022	2023	Growth rate
Operatingincome	7,741,118	7,199,935	-7%
Net income(loss)	445,632	164,284	-63%

1. Profitability analysis

Unit: NT$Thousand

General ledger account Operatingincome Net income(loss) fitability analysis	2022 7,741,118 445,632	2023 7,199,935 164,284	Growth rate -7% -63% Unit: NT$Thousand
Item	2022	2023	Growth rate
Grossprofit	2,098,625	1,836,369	-12%
Operating profit	1,248,276	748,631	-40%
Pre-taxprofit	673,713	445,800	-34%
Net income	445,632	164,284	-63%
Basic after-tax EPS	3.37	1.75	-48%

1

Technology research and development

Based on the customer demands in the market and technology progress, TMC expands the capacity of 65/55/40nm key production machines according to the market demand, deepens the manufacturing technology service capability, and passes the verifications of customers and introduces mass production one by one; it invested in the development of technologies and capacity of 28nm photomasks in 2023 to strengthen technology service capability.

Production and manufacturing service

In the establishment of real-time B2B, TMC provides more immediate, accurate and traceable information to FABs, to facilitate customers' convenient and real-time WIP management, assist customers in supplier management, and increase customer trust.

In addition, the Company builds new capacity in a timely manner to increase the production ability, and apply it to the needs of advanced photomasks, for optimizing orders, achieving a balance between production and sales, and maximizing profits. In the future, we will continue to make sound investments to deploy new production capacity position, continuously increases production value and efficiency as the feedback to shareholders. In addition, each subsidiary performs manufacturing and other related services according to its business nature, and continues to expand its operations and improve its quality and manufacturing service capabilities through effective management in order to strengthen its competitive edge in the market.

Summary of 2024 Business Plan

1. The Company will continue to strengthen operations, deepen customer satisfaction and loyalty, continuously optimize quality and control costs through various CIP projects, and optimize orders to achieve balance between production and sales while increasing the Company’s profits.

2. Continuously expanding the photomask business required for 40nm 12-inch wafer related technologies

3. After the successful mass production of 65nm photomasks, in 2024, we will actively expand photomask manufacturing services for 12-inch wafer fabs, by adding the 55-90nm manufacturing services and introducing the mass production of 40nm photomask and plan investment in manufacturing technology and production services for 28nm photomasks.

4. Integration and exertion of the Group’s synergies

5. Under the foundation of photomask service, combining with its subsidiaries, including Miracle Tech’s foundry agency service, Aptos Tech’s flashing memory and testing service, Xsense Tech’s highpower heat dissipation substrate production, Innova Vision’s contact lens manufacturing, DIGITALCAN TECH’s focus on lamination of aerospace metals for defense and industrial purposes, Pilot’s all-round energy solutions of energy generation and energy storage provided, and Moment Semiconductor’s self-owned brand consumer electronic products, there are expectations to create more values for shareholders through the Group’s internal collaborations and the comprehensive resources management.

6. Continuous implementation of sustainable development: Taiwan Mask adheres to the business philosophy of “respect for the sky, love for people, and protect the planet” and develops its business in the three major fields of semiconductor, green energy, and smart manufacturing. We pursue sustainable development with energy creation and

2

energy conservation. By focusing on core business development, managing the Group’s total resources, aiming at innovation and sustainability, and working with strategic customers, suppliers, subsidiaries of the Group, and stakeholders to integrate resources, we will continue to invest in sustainability issues and implement sustainable development.

Future development strategies, impact of the competitive environment, regulatory environment, and the overall business environment

1. Future development strategies

2. The Company continues to heighten its operations capability and deepen its customer service for its core business of photomask. Due to the alignment technology requirements of integrated circuits, Optical Proximity Correction Mask (OPC) and PSM (Phase Shift Mask) are widely used in 8” and 12” foundries due to the alignment technology of ICs, and they vary with the equipment and technology of each foundry. These require close cooperation with the foundry to produce products and services required by customers.

3. Therefore, it is our development strategy to establish and deepen good mutual cooperation with foundries, and become the cooperation partner of strategic customers, and to increase the proportion of related sales.

4. Impact of the competitive environment, regulatory environment, and the overall business environment

5. There is a close relationship between the development of the photomask industry and semiconductor industry. In recent years, the markets and applications of 5G and 6G, AI, IOT, automotive electronics, high-speed computing and energy-saving continue to grow, thus driving the prosperity of the semiconductor and related industries. The protectionism and geopolitics in many countries have brought about new business opportunities and growth, despite the impact and increased uncertainty. TMC increased its production capacity in a timely and appropriate manner, and steadily and progressively invested in new facilities to develop new technologies to assist customers and develop with them for mutual benefit.

Best wishes to all valued shareholders.

Chairperson: Sean Chen

==> picture [45 x 45] intentionally omitted <==

3

Two. Company Profile

I. Date of incorporation

October 21, 1988

II. Company History

April 1, 1988	Initiated by Industrial Technology Investment Corporation (ITIC), the Preparatory Committee selected Mr. Chin-Tai Shih as the Chairperson and hired Mr. Parkson Chen as Director of Preparatory Office.
May 4, 1988	Approved by the Science and Industrial Park for meeting the requirements as stipulated in Article 3 on “Approval for investment and establishment within the Science and Industrial Park” of the Industrial Park’s Establishment Management Regulations.
October 7, 1988	The organizers approved the Company Charter and elected directors and supervisors during the meeting. The nine elected directors are Chung-Mou Chang, Chin-Tai Shih, Ching-Chu Chang, Pao-Hsi Chang, Fan-Cheng Tseng, Hsien-Hsiung Huang, Chi-Lin Chiang, Jui-Yu Kuo, Parkson Chen, and three elected supervisors are Min-Chan Chen, K.J. Wu, and Mei-Li Tsai. The Board of Directors selected Mr. Chin-Tai Shih as Chairperson and hired Mr. Parkson Chen as General Manager.
October 21, 1988	Acquired official company license.
March 4, 1989	Obtained approval from Hsinchu Science Park for a land of 0.96 hectares for use of factory construction.
March 24, 1989	Obtained certificate of business registration approved by the Local Tax Bureau Hsinchu City, and the first business invoice (Government Uniform Invoice) was issued on the same day on March 31.
August 18, 1989	Chairperson Mr. Chin-Tai Shih resigned from the chairperson position and was succeeded by Mr. Chi-Mo Wang.
September 18, 1989	Groundbreaking ceremony for the Company’s new factory site in Hsinchu Science Park.
November 1989	The Company purchased its second electron beam exposure system.
March 16, 1980	Approved by Securities and Futures Bureau (SFB) as a company with initial public offering of stocks.
April 3, 1980	Joint meeting of directors and supervisors during the 1st Term 5th Meeting passed the resolution for cash capital increase of NT$262,500,000 and collected in full on June 5 of the same year.
April 2, 1991	Changing the company’s authorized capital stock to NT$500,000,000 due to long-term development needs of the company was approved at the Shareholders’ Meeting.
July 22, 1991	The Company’s newly-built factory in Hsinchu Science Park was completed for use.
June 1992	Completed outsourced manufacturing of 4 M DRAM photomask by Electronics Institute of Industrial Technology Research Institute (ITRI), proven the strength and ability of submicron development in Taiwan.

4

August 24, 1992	Entered into a contract agreement with Japan’s ICA company to purchase CORE-2564 laser-beam mask/reticle lithography system made by ETEC company to meet the requirements in industrial developments of integrated circuit for 16 M DRAM and 64 M DRAM.
October 1993	ICS company of the United States came to Taiwan to present the Zero-Defect Quality Award to the Company, in recognition of the Company’s speedy delivery of goods and great quality with zero defects.
January 1994	Collaborated with Electronics Institute of Industrial Technology Research Institute (ITRI) to co-develop finished photomask products for Liquid Crystal Display (LCD) usage and to formally supply them to LCD manufacturers.
May 1994	The newly purchased CORE-2564 laser-beam mask/reticle lithography system arrived at the factory. It was the newest model at that time with added computerized rapid processing function and it allowed development of Phase Shift Mask.
November 21, 1994	The Company was approved by the 235th Meeting of the Marketable Securities Listing Committee of the Taipei Stock Exchange Corporation (TWSE) and agreed for the Company’s stock to be listed as Class II stocks. Officially listed on April 17, 1995.
February 13, 1995 - March 14, 1995	The Company’s stocks were co-handled with the eleven securities underwriter of CTBC Securities on matters of public sale prospectus prior to listing, the negotiated sale price was NT$47 per share. All matters of the sale were completed on March 14, 1995, and on March 27 of the same year submitted a declaration to TWSE for official listing on April 17.
May 13, 1995	The Company had purchased a large-size exposure machine which arrived at the factory for set-up, becoming the first company in Taiwan to be able to provide large-size photomasks needed by LCD.
June 6, 1995	The shareholders’ meeting approved increasing the authorized capital stock to NT$700,000,000.
October 17, 1995	Purchased the third CORE2564 machine to the factory for set-up.
January 5, 1996	The Securities and Futures Bureau (SFB) approved the Company’s cash capital increase of NT$85,437,500. The offering was completed on April 2, 1996.
June 1, 1996	The shareholders’ meeting approved increasing the authorized capital stock to NT$1,000,000,000.
June 27, 1996	The Company purchased electron beam exposure system equipment produced by Japan’s electro-optical company which arrived at the factory for set-up. The machine’s model is JBX-7000MV which was designed especially for the production of 64M and 256M DRAM. The Company had introduced a variable shaped beam exposure system for the first time, along with the available equipment at that time, it brought the Company’s production method at that time into a new era.
July 8, 1996	The Company signed a collaborative agreement with United Microelectronics

5

	Corporation (UMC) for 0.35 micrometer (μm) photomask mass production. UMC to purchase one 0.35 μm processing photomask exposure machine to be placed at the Company in 1997. The Company was then responsible for management of the production and manufacturing, supplying photomask to UMC’s 8-inch wafer factory.
August 2, 1996	The laser-beam mask/reticle lithography system made by U.S.A.’s ETEC company that the Company purchased had arrived at the factory for installation. The system model was ALTA-3000 which was considered as the newest precision equipment model at that time, a model type designed specifically for 0.35 μm manufacturing for mass production and 0.25 μm manufacturing development. This machine system provided abundant support and supply to the Company in supplying photomask to 8-inch integrated circuit factories.
November 9, 1996	Joint meeting of directors and supervisors during the 3rd Term 14th Meeting had approved cash capital increase of NT$119,228,750, actual paid-in capital after capital increase was NT$1,100,000,000.
May 21, 1997	The convening of the 1997 Shareholders’ Meeting had approved increasing the authorized capital stock to NT$2,500,000,000, 4th Term Election of Directors and Supervisors with Mr. Chi-Mo Wang’s reappointment as the 4th Term Chairperson.
July 23, 1997	Groundbreaking ceremony for the Company’s second factory, expected year of completion was 1998.
May 21, 1998	The 1998 shareholders’ meeting approved increasing the authorized capital stock to NT$2,700,000,000.
May 5, 1999	The 1999 shareholders’ meeting approved increasing the authorized capital stock to NT$3,891,000,000.
April 2000	The laser-beam mask/reticle lithography system made by U.S.A.’s ETEC company that the Company purchased was the ALTA-3500 model. It was a model type designed specifically for 0.18 μm manufacturing for mass production and 0.15 μm manufacturing development.
June 12, 2000	The 2000 shareholders’ meeting approved the merger with Hsintai Technology Company Limited and increased the authorized capital stock to NT$4,500,000,000. Election of the 5th Term directors and supervisors took place during the meeting, with Mr. Shan-Ko Hsu elected to chairperson.
December 1, 2000	Baseline date for merger of Hsintai Technology Company Limited.
April 24, 2001	The 2001 shareholders’ meeting approved increasing the authorized capital stock to NT$5,200,000,000. By-election for the 5th Term directors and supervisors took place due to resignation of one director and one supervisor from Wensheng Investment Company and ITIC respectively. After the by-election, Biyou Electronics Industrial Company and Tech Alliance Corp. took up positions of director and supervisor respectively.
March 2002	The Company’s second factory had completed construction and was in usage.

6

June 3 2003	The 2003 shareholders’ meeting elected 6th Term directors and supervisors, Mr. Shan- Ko Hsu was reappointed to 6th Term chairperson.	The 2003 shareholders’ meeting elected 6th Term directors and supervisors, Mr. Shan- Ko Hsu was reappointed to 6th Term chairperson.
June 12, 2006	The 2006 shareholders’ meeting elected 7th Term directors and supervisors, Mr. Shan- Ko Hsu was reappointed to 7th Term chairperson.
June 10, 2009	The 2009 shareholders’ meeting elected 8th Term directors and supervisors, Mr. Shan- Ko Hsu was reappointed to 8th Term chairperson.
June 28, 2012	The 2012 shareholders’ meeting elected 9th Term directors and supervisors, Mr. Parkson Chen was elected to 9th Term chairperson.
June 25, 2015	The 2015 shareholders’ meeting elected 10th Term directors, independent directors and supervisors, Mr. Parkson Chen was elected to 10th Term chairperson.
June 23, 2017	The 2017 shareholders’ meeting elected 11th Term directors, independent directors and supervisors, Mr. K.J. Wu was elected to 11th Term chairperson.
October 1, 2017	Baseline date for merger of Miracle Technology CO., LTD. (Miracle Tech).
August 9, 2018	The Board of Directors passed the resolution to acquire equity of Weida Hi-Tech Company by cash.
May 3, 2019	Innova Vision INC. organized cash capital increase by issuance of new shares on May 3, 2020. The Group has not executed based on shares proportion. Therefore, the Group has lost control of this company and Innova Vision INC. is not a subsidiary of the Group now.
June 28, 2019	Aptos Technology INC. held elections for all directors. The Company’s subsidiary Youe Chung Capital Corporation won more than half of the director seats obtaining actual control of this company. It will then be included as a subsidiary of the Group from this date onwards.
March 18, 2020	A special meeting of the shareholders was convened in 2020 for election of 12th Term directors. Mr. Michael Tsai was elected as a 12th Term chairperson.
April 10, 2020 May 15, 2020 June 2, 2020	Weida Hi-Tech Company issued new stocks for cash capital increase separately on April 10, 2020 and May 15, 2020. The Group did not keep up with the subscription for shareholding, which caused the shareholding to drop to 36.7%. Weida Hi-Tech Company then held an extraordinary general meeting of shareholders on June 2, 2020 to elect new directors. The Company won one seat of director and lost the control of the Weida.
November 4, 2020	The board approved of the appointment of Mr. Sean Chen as the Company's chairman of the 12th term.
December 16, 2020	Innova Visison held an extraordinary general meeting of shareholders on December 16, 2020 to elect new directors. The Company’s subsidiary Youe Chung Capital Corporation won all of the director seats, obtaining substantial control of this company. It will then be included as a subsidiary of the Group from this date onwards.
June 2021	Established the Taiwan Mask Charity Foundation.

7

July 2021

The issuance of the 3rd series domestic unsecured convertible bonds for NT$1.8 billion was approved.

September 2022 October 2022 December 2022 December 2022 March 2023 May 2023 August 2023 October 2023 December 2023

Approved the issue of 2022 1st series secured corporate bonds for NT$500 million. Introduced verification of 40nm photomask manufacturing process. Constructed the laser welding R&D center and network with steel structure industry leaders to drive industry transformation. Approved the issue of 2022 2nd series secured corporate bonds for NT$500 million. The Landscape and Ecological Garden of TMC Zhunan Factory was completed to create a sustainable environment. The 2023 shareholders’ meeting elected the 13th Board of Directors, and Mr. Sean Chen was elected as the 13th Chairman. Approved the issue of 2023 1st series secured corporate bonds for NT$500 million. On the 35th anniversary of the establishment of TMC, the Group’s family day was expanded. Approved the issue of 2023 2nd series secured corporate bonds for NT$500 million.

8

Three. Corporate Governance Report

I. Organizational Structure

(I) Organizational Structure

==> picture [786 x 341] intentionally omitted <==

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

Board of Directors
Auditing Office
Chairman
Chief Executive Officer
Chief Financial
Officer (Note)
General Manager
Operations Operations Sales Finance
organization II organization I organization organization
Group China Group
Hsinchu Information Operating Steel New Environmental Advanced
Science Technology and Special Resources Structure Construction Construction Safety Equipment R&D
Park Plant Division Projects Project Division Division and Division #2
Division Division Factory
department Assurance Quality Department Technology R&D Department Factory Affairs Business unit development department Business Management department Production department Finance Accounting department Investment and legal affairs department Resources Human department Purchasing Engineering department Industrial
----- End of picture text -----

Note: The position of Chief Financial Officer is mainly responsible for integrating the financial resources of the Group, and the financial officers or departments established for each firm in the Group (including the Company) are still responsible for handling the financial matters of each firm, and presenting them at different levels according to the approval authority set by each firm. Finally, the CFO summarizes related implementation and reports to the CEO.

9

(II) Business operations of main departments

Main departments	Main duties of each department	Main departments	Main duties of each department
Auditing Office	Audit the internal control operations, assess the soundness and effectiveness of internal controls and the accuracy of financial and accounting information.	Production Management department	Production schedule, import-export, storage and transportation business, testing and certification of photomask.
Group Environmental Safety Construction Division	Management of labor occupational safety and health.	Group Operating Resources and Special Projects Division	Monitor and control project execution progress, process quality, cost utilization and project target discrepancies, and make continuous improvements.
Factory Affairs Department	Controls electricity, air-conditioning and clean room and is responsible for the shift scheduling, meter reading and agents reserves of various system equipment, and is capable of understanding and handling the system issues in a timely manner. Perform primary and secondary maintenance and inspection of system equipment, environmental management system and occupational safety and health-related works, contracting of secondary distribution, buildings and project construction and the related supervision, trial run and acceptance. Analyze and understand the system equipment and improve the operating conditions and the emergencyresponses to various incidents.	Advanced Equipment R&D Division #2	Development of automation equipment.
Hsinchu Science Park Plant	Production management of photomask. Inspection and repair of photomask manufactured, control and management of production cost, production efficiency improvement, manufacturing equipment maintenance and handle process exceptions.	China Steel Structure Project Division	High-energy laser welding, steel structure production automation integration, steel structure smart manufacturing system.
Information Technology Division	CAD technology development, engineering computer software development, maintenance and computer management, maintenance. Coding development, supporting customers information correction and service, providing MIS information.	New Construction Division	Execute planning, evaluation, design, budgeting, schedule estimation, contracting supervision, and operation system establishment of plant systems in accordance with the objectives of the Group'splant expansion andprojectplans.
Technology R&D Department	R&D of advanced manufacturing technology of photomasks. Assessment, development and incorporation of advanced photomask machine and materials, customer new product certification and introduction, discussion of customer technical issues.	Industrial Engineering department	Work standardization, simplifying, process analysis and optimization, investment analysis, cost analysis.
Quality Assurance department	Formulating product specification, quality guarantee planning, customer service.	Purchasing department	Material, machines and general purchase business.
Sales organization	Product sales, market research and development.	Finance organization	Financial scheduling, fund management, collection, production and analysis of accounting information, shareholder services related business, group investment management and legal affairs.
Human Resources department	Human resources and salary, recruiting, administration, education and training andgeneral affairs(management of employee cafeteria, gym and coffee shop).

10

II. Information on Directors, General Manager, Vice General Managers

(I) Information on presdent and vice presidents

March 31, 2024

Job title	Nationality	Name	Gender	Date elected/ appointed	Shareholding	Shareholding	Shares held by spouse, underage dependents	Shares held by spouse, underage dependents	Shares held o	in the names of thers	Main career (academic) backgrounds	Concurrent Position in Other Companies	Managers who are Spouse or Blood Relatives Within the Second Degree	Managers who are Spouse or Blood Relatives Within the Second Degree	Managers who are Spouse or Blood Relatives Within the Second Degree	Note
					Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage			Job title	Name	Relationship
Chief Executive Officer	Republic of China	K.J. Wu	Male	January 15, 2020	5,796	0.00%	5,075,523	1.98%	-	-	MBA, University of Maryland, United States of America; Director, Finance Office, ITRI Chairman,Taiwan Mask Corporation	Chairperson, Taiwan Mask Charity Foundation	-	-	-	-
General Manager	Republic of China	Lidon Chen	Male	January 15, 2020	3,750,000	1.46%	0	0.00%	-	-	Master’s, Department of Atmospheric Sciences, National Central University General Manager of Xintec Inc. General Manager of DelSolar Co., Ltd.	Chairperson, Xsense Technology Corporation Director of Digital-Can Tech. Co., Ltd. Director, Aptos Technology INC. Director of Weida Hi-Tech Co., Ltd. Director of Moment Semiconductor, Inc. Director, Pilot Qiangxiang Co.,Ltd.	-	-	-	-
Chief Financial Officer	Republic of China	Eve Yang	Female	March 17, 2020	1,953,000	0.76%	0	0.00%	-	-	MBA, University of North Alabama, USA Vice President of Finance, FOCI Fiber Optic Communications, Inc.	Chairperson, Youe Chung Capital Corporation Director of Digital-Can Tech. Co., Ltd. Supervisor, Xsense TechnologyCorporation	-	-	-	-
Chief Operating Officer	Republic of China	Nester Huang	Male	February 20, 2020	1,656,000	0.65%	0	0.00%	-	-	Bachelor degree, Department of Applied Physics, Tunghai University Director of Manufacturing (Back-end processes), Micron Technology, Inc. General Manager, JCET Group Co., Ltd.	Chairman of Digital-Can Tech. Co., Ltd. Director, Aptos Technology INC.	-	-	-	-
Vice General Manager of Operations	Republic of China	Che-Pin Tseng	Male	November 15, 2021	293,000	0.11%	2,000	0.00%	-	-	Bachelor degree, Department of Applied Physics, Chung Yuan Christian University Vice President of Operations, Episil Holding Inc. Vice President of Operations, Toppan Chunghwa Electronics, Co., Ltd. Taiwan Branch	-	-	-	-	-
Vice President	Republic of China	Chaucer Chung	Male	August 4, 2023	300,000	0.12%	0	0.00%	-	-	Department of Physics, Fu Jen Catholic University - Master's Degree Manager of PIE/MQR Dept., TSMC Chief of Operations Division, Japan Factory,Hon Hai Precision		-	-	-	-

Note: There are no situations where the aforementioned personnel are the same person as the Chairperson, or is a spouse or first-degree relative of the Chairperson.

11

(II) Profile of directors and independent directors

March 31, 2024

Job title	Nationality or Place of Registration	Name	Gender and Age	Date elected/ appointed	Term	Date first elected	Shareholding when elected	Shareholding when elected	Current shareholding	Current shareholding	Shares held by spouse and underage children	Shares held by spouse and underage children	Shares name	held in the s of others	Main career (academic) backgrounds	Concurrent duties in the Company and in other companies	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Note
							Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage			Job title	Name	Relationship
Chairman	Republic of China	Sean Chen	Male 57	May 24, 2024	3 Years	March 18, 2020	2,000,000	0.78%	2,000.000	0.78%	794,000	0.31%	-	-	Director, Tachun Venture Capital Co., Ltd. Chairperson,Antario Corporation Chief Executive Officer, xFuture Ltd. GLMS Group (NTT Com Asia Partner) Executive Vice President Director of Business Unit, AVerMedia Technologies, Inc. CEO and Co-founder, Goosean Media Inc. Assistant Vice President, Sales Consultation, Oracle Corporation Asia Pacific, Greater China region Manager, Application Software Development Group, Oracle Corporation USA Headquarter IT Manager, Taiwan Semiconductor ManufacturingCompanyLimited	Chairman, Taiwan Mask Corporation Chief Executive Officer, USA’s N2 Connectivity Inc Chairman, Jaas data inc. Director, Xsense Technology Corporation Director, BKS Tec Corp. .
Director	Republic of China	Lidon Chen	Male 60	May 24, 2024	3 Years	March 18, 2020	2.750.000	1.07%	3,750,000	1.46%	-	-	-	-	Master’s, Department of Atmospheric Sciences, National Central University General Manager of Xintec Inc. General Manager of DelSolar Co., Ltd.	Director and President of Taiwan Mask Corporation Chairperson, Xsense Technology Corporation Director of Digital-Can Tech. Co., Ltd. Director, Aptos Technology INC. Director of Weida Hi-Tech Co., Ltd. Director of Moment Semiconductor, Inc. Director,PilotQiangxiangCo.,Ltd.
Director	Republic of China	Chao-Yi Wu	Female 41	May 24, 2024	3 Years	March 18, 2020	9,907,000	3.86%	10,298,000	4.02%	668,000	0.26%	-	-	Master’s degree, Cornell University, USA Manufacturing and Engineering Department, Wintec Industries Inc. Management Department, Sinyi Realty Inc., Japan Account Manager, Browave Corporation President, Browave Corporation Japan	Chairperson, Taiwan Mask Corporation President, Browave Corporation Japan Director, Browave Corporation Chairman, Ontario Capital Co., Ltd.	Chief Executive Officer	K.J. Wu	Father and daughter
Director	Republic of China	Youe Chung Capital Corporation	Method Person (s)	May 24, 2024	3 Years	May 24, 2024	36,731,440	14.32%	35,831,440	13.97%	-	-	-	-
		Representative: Ming-Chung Chang	Male 62	May 24, 2024	3 Years	May 24, 2024	0	0%	0	0%	-	-	-	-	EMBA from National Central University Senior Vice President, Delta Electronics Co., Ltd. Director, Delta Electronics Co., Ltd. Director, Delta Electronics Foundation	-

Note: 1. There are no situations where the aforementioned personnel hold concurrent positions as the chairperson and president or equivalent position (manager as the highest level), or is a spouse or first-degree relative of the Chairperson.

12

Job title	Nationality or Place of Registration	Name	Gender and Age	Date elected/ appointed	Term	Date first elected	Shareholding when elected	Shareholding when elected	Current	shareholding	Shares held by spouse and underage children	Shares held by spouse and underage children	Shares he o	ld in the names f others	Main career (academic) backgrounds	Concurrent duties in the Company and in other companies	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Spouse or relatives of second degree or closer acting as directors, supervisors, or department heads	Note
							Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage			Job title	Name	Relationship
Independent Director	Republic of China	Wei- Chen Wang	Male 66	May 24, 2024	3 Years	July 5, 2021	-	-	-	-	-	-	-	-	Department of Accounting, National Chengchi University CPA, PwC Taiwan	Independent director, Taiwan Mask Corporation Independent director, ENNOSTAR Inc. Independent director, FEATURE INTEGRATION TECHNOLOGY INC. Independent director, Etron Technology CPA, Zhicheng Hexing CPA Firm	-	-	-	-
Independent Director	Republic of China	Huan- Kuei Cheng	Male 69	May 24, 2024	3 Years	July 5, 2021	6,051	0.00%	6,051	0.00%	-	-	-	-	Master of Business Administration, Saginaw Valley State University, Michigan, USA Director, National Chung-Shan Institute of Science and Technology Director, Browave Corporation Supervisor, National Chung- Shan Institute of Science and Technology Assistant Professor, Institute of Accounting, Soochow University	Independent director, Taiwan Mask Corporation Director, National Chung- Shan Institute of Science and Technology	-	-	-	-
Independent Director	Republic of China	Hui-Fen Chan	Female 55	May 24, 2024	3 Years	May 26, 2022	7,000	0.00%	0	0.00%	-	-	-	-	Master of Law, Boston University Bachelor of Law, National Taiwan University Taiwan Attorney and New York State Attorney Qualification Chief Legal Officer, Altek Corporation Head of Legal Affairs, Siliconware Precision Partner Attorney, H. L. Partners Attorney,Lee and Li	Independent director, Taiwan Mask Corporation Independent director, ITEQ CORPORATION, Independent director, Chipmos Technologies Inc. Independent Director, Formosa I Wind Power Co., Ltd. (Note 2) Chairman of Keep Enlightment Management Consulting Co., Ltd. Chairman, KEEP ENLIGHTMENT MARKETING CORP.	-	-	-	-

Note:

1. There are no situations where the aforementioned personnel hold concurrent positions as the chairperson and general manager or equivalent position (manager as the highest level), or is a spouse or firstdegree relative of the Chairperson.

2. Formosa I Wind Power Co., Ltd. is not a public company.

(III) Major shareholders of corporate shareholders

March 31, 2024

	March 31,2024
Name of Corporate Shareholders	Majoritycorporate shareholders
Youe Chung Capital Corporation	Taiwan Mask Corporation (100%)

13

(IV) Main shareholders of majority corporate shareholders

March 31, 2024

	March 31,2024
Name of Legal Person	Majoritycorporate shareholders
Taiwan Mask Corporation	Youe Chung Capital Corporation (13.78%); Chao-Yi Wu (4.02%); TAIWAN MASK CORP. (2.91%); Huei-Chen Wu- Lai (1.98%); Powerchip Investment Holding Corporation (1.61%) ), Lidon Chen (1.46%), Mei-Hui Li (0.89%), Vanguard Starlight Advanced Aggregate International Equity Index under the custody of Chase (0.82%), Sean Chen (0.78%), Dedicated account with CTBC Bank Trust Investment entrusted byTaiwan Life Insurance(II) (0.78%)

• (V) Disclosure of professional qualifications of directors and independence of independent directors

			March 31, 2024
Criteria Name	Professional qualifications and experience	Independence (Note 1)	Concurrently serving as an independent director in other publiclylisted companies
Sean Chen	1. Have more than 20 years of work experience in the area of commerce or otherwise necessary for the business of the Company. 2. Experience in technology industry. 3. Currently the Chairman of Taiwan Mask Corporation. 4. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Not applicable	None
Lidon Chen	1. Have more than 20 years of work experience in the area of commerce or otherwise necessary for the business of the Company. 2. Experience in semiconductor and photovoltaic industry. 3. Currently the President and a director of Taiwan Mask Corporation. 4. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Not applicable	None
Chao-Yi Wu	1. Have more than 10 years of work experience in the area of commerce or otherwise necessary for the business of the Company. 2. Experience in technology and real estate industry. 3. Currently a director of Taiwan Mask Corporation and Taiwan Mask Charity Foundation. 4. Not been aperson of anyconditions specified in Article 30 of	Not applicable	None

14

Criteria Name	Professional qualifications and experience	Independence (Note 1)	Concurrently serving as an independent director in other publiclylisted companies
	the CompanyAct.
Youe Chung Capital Corporation Representative: Ming- Chung Chang	1. Have more than 20 years of work experience in the area of commerce or otherwise necessary for the business of the Company. 2. Experience in technology industry. 3. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Not applicable	None
Wei-Chen Wang	1. More than 20 years of accounting and auditing experience. 2. CPA, PwC Taiwan 3. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Conformed	3
Huan-Kuei Cheng	1. More than 20 years of auditing and corporate governance experience. 2. Had worked as a university professor. 3. Currently a director of National Chung-Shan Institute of Science and Technology and an independent director of Taiwan Mask Corporation. 4. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Conformed	0
Hui-Fen Chan	1. More than 20 years of legal affairs and commerce experience. 2. Taiwan Attorney and New York State Attorney Qualifications. 3. Current an independent director of Taiwan Mask Corporation and other publicly traded companies. 4. Not been a person of any conditions specified in Article 30 of the CompanyAct.	Conformed	2

15

• (VI) Diversity and Independence of the Board of Directors

1. Diversity of the Board of Directors

The “Corporate Governance Best Practice Principles” defined that the composition of the board should be diverse. In addition to limiting those who hold concurrent positions to no more than 1/3 of the total board seats, and that there should be at least two seat of female directors, the diversity policy should be formulated based on the Company's operations, business activities and growth, and should include, but is not limited to the standards of the following two aspects:

• (1) Background and value: Gender, age, etc. (2) Professional background and skills and industry experience.

The Board’s diversity policy, specific management objectives, and the status of achievement:

Diversity policyand management objective	Achievement
There should be at least three independent directors, accountingno less than 1/5 of the board seats.	Achieved
The number of directors taking concurrent positions as the Company's managers shall not exceed 1/3 of the board seats.	Achieved
At least two seats of female directors.	Achieved
Diversification ofprofessional capabilities	Achieved

In 2023, the implementation of the diversity policy for board members of the Company (including professional abilities, independence, and gender diversity) is as follows:

(1) Achievement of diversification of professional abilities

Core abilities		Accounting				An
	Business		Business	Crisis	Knowledge			Decision-
		and financial				international	Leadership
	judgment		management	management	of the			making
Name		analysis				market	ability
	ability		ability	ability	industry			ability
		ability				perspective
Sean Chen	Excellent	Good	Excellent	Excellent	Excellent	Excellent	Excellent	Excellent
Lidon Chen	Excellent	Good	Excellent	Excellent	Excellent	Excellent	Excellent	Excellent
Chao-Yi Wu	Excellent	Excellent	Excellent	Excellent	Good	Excellent	Excellent	Excellent
Ming-ChungChang	Excellent	Good	Excellent	Excellent	Excellent	Excellent	Excellent	Excellent
Wei-Chen Wang	Excellent	Excellent	Excellent	Excellent	Good	Good	Excellent	Excellent
Huan-Kuei Cheng	Excellent	Excellent	Excellent	Excellent	Good	Good	Excellent	Excellent
Hui-Fen Chan	Excellent	Good	Excellent	Excellent	Good	Good	Excellent	Excellent

16

(2) Implementation of independence and gender diversity

The Company’'s 13th Board of Directors consists of seven directors with a gender distribution: five (71%) of which were male directors and two (29%) female directors; in terms of independence, three are independent directors, accounting for 43% of the total number of seats on the Board; all three independent directors are newly elected. The term of office is one term only.

2. Independence of the Board of Directors

The Company has three independent directors, who have more than one-third of the board seats, all of whom are professionals with rich professional and industrial experience. Independent director Wei-Chen Wang is a CPA and has more than 20 years of practical experience in the industry, accounting, finance and auditing. Independent director Huan-Kuei Cheng was a director and supervisor of the National Chung-Shan Institute of Science and Technology and taught at a university; he also has rich experience in business, accounting, auditing, corporate governance and industry. Independent director Hui-Fen Chan is a practicing attorney in Taiwan and New York State of the US, and has worked in the semiconductor industry; she also has extensive business, legal and industry experience. All three independent directors are in compliance with Articles 2, 3 and 4 of the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies, meeting the qualification requirements of specialization, work experience, independence and number of firms concurrently served as an independent director, and are not in the circumstances specified in Paragraph 3 and 4, Article 26-3 of the Securities and Exchange Act.

17

III. Remuneration paid during the most recent fiscal year to directors of the board (including independent directors), the general manager, and vice general managers

(I) Remuneration for directors (including independent directors)

Unit: NT$ Thousand

Job title	Name			Director compensation	Director compensation	Director compensation	Director compensation			Proportion of Total Remuneration (A + B + C + D) out of Net Income (Note 10)	Proportion of Total Remuneration (A + B + C + D) out of Net Income (Note 10)			Compensation received	Compensation received	as employee	as employee	as employee		Total Compensation (A+B+C+D+E+F+G) as a % of the Net Income(Note 10)	Total Compensation (A+B+C+D+E+F+G) as a % of the Net Income(Note 10)	Related profit sharing from earnings from investees other than the subsidiaries or the parent company (Note 11)
		Compensation (A) (Note 2)		Pension (B)		Director remuneration (C)(Note 3)		Fees for services rendered (D)(Note 4)				Base Compensation, Bonuses, and Allowances (E) (Note 5)		Severance Pay and Pensions (F)		Employee remuneratio (Note 6)			n (G)
		The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company	All companies included in the financial statements (Note 7)	The Company		From Conso Entities	All lidated (Note 7)	The Company	All companies included in the financial statements (Note 7)
																Cash	Stock	Cash	Stock
Chairman	Sean Chen	0	0	0	0	8,976	8,976	140	140	2.49	2.49	4,060	4,060	0	0	2,000	0	2,000	2,000	4.15	4.15	None
Director	Lidon Chen
Director	Chao-Yi Wu
Director	Representatives, Youe Chung Capital Corporation: Ming-ChungChang
Independent Director	Wei-Chen Wang	4,320	4,320	0	0	3,024	3,024	105	105	2.04	2.04	0	0	0	0	0	0	0	0	2.04	2.04	None
Independent Director	Huan-Kuei Cheng
Independent Director	Hui-Fen Chan

Note :

1. The policy, system, standards and structure of remuneration payments to independent directors, and describe the relations between the responsibility, risk, time committed to the organization and other factors and the amount of remuneration to them.

2. (1) Director remuneration payment policy:

   • According to Article 23 of the Articles of Incorporation, the Company shall distribute not less than 10% of the current year’s profit situation for employee remuneration and not more than 2% of current year’s profit for director remuneration. However, profits must first be taken to offset against cumulative losses, if any. Employee remuneration, as mentioned above, can be paid in cash or in shares. Qualified employees of subsidiaries are also included in the payment. Current year profit situation as mentioned in the preceding paragraph refers to the profit which is the current year’s pre-tax profit before distribution of employee remuneration and director and supervisor remuneration. The distribution of employee and director remuneration shall be executed after the resolution approval at the Board meeting with more than two-thirds of directors attending and of more than half of the attending directors agreed and passed the resolution, and reported to the shareholders meeting.

3. (2) The remuneration standards and packages, the procedure for determining remuneration and its linkage to the Company’s operating performance and future risks: The remuneration of the Company’s directors shall be determined by the Board of Directors, as authorized by the Articles of Incorporation, with reference to the extent of each director’s participation in the Company’s operations and his or her contribution, and with reference to the usual level of domestic and foreign industry payment standards. If the Company is profitable, the board (including the Remuneration Committee) shall decide the amount of remuneration for directors in accordance with the Articles of Incorporation. Independent directors are ex-officio members of the Audit Committee. Considering their duties, risks and time commitment, they are paid reasonable remuneration in addition to the director remuneration they receive. According to the Company Charter, the Company shall distribute not more than 2% of the current year’s profit situation for director remuneration. The proportion distributed by the Company is reasonable, in accordance to the Charter.

4. In addition to the disclosure shown in the above table, the remuneration received by the directors for their service provided to all companies listed in the financial reports in the most recent fiscal year: None.

5. The Company’s 13th board of directors was elected at the regular shareholders’ meeting on May 24, 2023. The directors elected were: Sean Chen, Lidon Chen, Chao-Yi Wu, Youe Chung Capital Corporation (Representative: Ming-Chung Chang), Independent Director Wei-Chen Wang, Independent Director Huan-Kuei Cheng and Independent Director Hui-Fen Chan.

18

(II) Remuneration range of directors (including independent directors)

Range of compensation paid to the Company’s directors	Name of director	Name of director	Name of director	Name of director
	Sum of first 4 compensations(A+B+C+D)		Sum of first 7 compensations(A + B + C + D + E + F + G)
	The Company (Note 8)	From All Consolidated Entities(Note 9)H	The Company (Note 8)	From All Consolidated Entities(Note 9)I
Below NT$1,000,000
NT$1,000,000 ~ NT$1,999,999	Representatives, Youe Chung Capital Corporation: Ming-ChungChang	Representatives, Youe Chung Capital Corporation: Ming-ChungChang	Representatives, Youe Chung Capital Corporation: Ming-ChungChang	Representatives, Youe Chung Capital Corporation: Ming-ChungChang
NT$2,000,000 ~ NT$3,499,999	Sean Chen, Chao-Yi Wu, Huan-Kuei Cheng Wei-Chen Wang, Hui-Fen Chan	Sean Chen, Chao-Yi Wu, Huan-Kuei Cheng Wei-Chen Wang,Hui-Fen Chan	Sean Chen, Chao-Yi Wu, Huan-Kuei Cheng Wei-Chen Wang, Hui-Fen Chan	Sean Chen, Chao-Yi Wu, Huan-Kuei Cheng Wei-Chen Wang, Hui-Fen Chan
NT$3,500,000 ~ NT$4,999,999
NT$5,000,000 ~ NT$9,999,999	Lidon Chen	Lidon Chen	Lidon Chen	Lidon Chen
NT$10,000,000 ~ NT$14,999,999
NT$15,000,000 ~ NT$29,999,999
NT$30,000,000 ~ NT$49,999,999
NT$50,000,000 ~ NT$99,999,999
NT$100,000,000 and above
Total	7people	7people	7people	7people
Total	7people	7people	7people	7people

• Note 1: The names of directors should be separately listed (legal person shareholder should list the name of the legal person and the representative separately), and the payment to each director and independent director should be summarized and disclosed.

• Note 2: Refers to the remuneration of directors in the most recent year (including the salary, differential pay for the job, severance pay, various rewards, bonuses and others).

• Note 3: Fill in the remuneration amount allocated to directors approved by the board meeting in the most recent year.

• Note 4: Refers to the related business implementation expenses of directors in the most recent years (including transportation, special disbursement, various allowance, housing, cars and other tangibles). In the case of provision of housing, cars and other forms of transportation or personal expenditure, disclose the nature and cost of the assets provided and the rent, gasoline and other payments paid at the actual or the fair market price. If a driver is assigned to the executive, please note the Company's payment to the driver, which is not included in the remuneration here.

• Note 5: Refers to the salary, differential pay for the job, severance pay, various rewards, bonuses, transportation, special disbursement, various allowances, housing, cars and other tangibles for the directors taking concurrent positions as employees (including as the general manager, assistant general manager, other department managers or employees). In the case of provision of housing, cars and other forms of transportation or personal expenditure, disclose the nature and cost of the assets provided and the rent, gasoline and other payments paid at the actual or the fair market price. If a driver is assigned to the executive, please note the Company’s payment to the driver, which is not included in the remuneration here. The salary expenses recognized in accordance with IFRS2 Share-based Payment, including obtaining employee stock options, restricted stock awards, participation in new share issuance through cash capital increase, should be included in the remuneration.

• Note 6: Refers to those directors taking concurrent positions as employees (including as the general manager, assistant general manager, other department managers or employees) and receiving employee compensation (including stocks and cash) in the most recent year, of whom the allocated employee compensation approved by the board shall be disclosed. If the amount cannot be estimated, calculate the amount for this year based on the actual allocated amount last year.

• Note 7: The total amount of remunerations paid to directors of the Company by all companies (including the Company) shall be disclosed in the consolidated report.

• Note 8: The total amount of various types of remunerations paid by the Company to each director and disclose the names in the specified range grades.

• Note 9: The total amount of various types of remunerations paid by all companies (including the Company) in the consolidated report to each director should be disclosed. Disclose the names of directors in the specified range grades.

• Note 10: The net income after tax refers to the number in the standalone financial report.

• Note 11: a. This field should state the amount of remuneration paid to directors from non-consolidated affiliates or parent companies.

• b. If a director of the Company receives a remuneration from non-consolidated affiliates or the parent company, the amount shall be included in Field I of the appropriate range grade, and the field name should be changed to “Parent company and all non-consolidated affiliates”.

• c. Remunerations refer to remuneration, compensation (including employee, director and supervisor compensation) and allowance for business operations received by the directors of the Company who serve as directors, supervisors or managing executives of the other non-consolidated affiliates that are not subsidiaries or the parent company.

• ＊The remunerations disclosed here in this Table are different from the incomes defined by the Income Tax Act. This Table is for the purpose of information disclosure and not for tax matters.

19

(III) Remuneration for President and Vice Presidents

Unit: NT$ Thousand

Job title	Name	Salary (A) (Note 2)	Salary (A) (Note 2)	Resignation Pension (B)	Resignation Pension (B)	Bonuses and Allowances (C)(Note 3)	Bonuses and Allowances (C)(Note 3)	Employee remuneration (D) (Note 4)	Employee remuneration (D) (Note 4)	Employee remuneration (D) (Note 4)	Employee remuneration (D) (Note 4)	Proportion (%) of Total Remuneration (A + B + C + D) out of Net Income(Note 8)	Proportion (%) of Total Remuneration (A + B + C + D) out of Net Income(Note 8)	Whether receive remuneration from non- consolidated affiliates or the parent company (Note 9)
		The Company	From All Consolidated Entities (Note 5)	The Company	From All Consolidated Entities (Note 5)	The Company	From All Consolidated Entities (Note 5)	The Company		From All Consolidated Entities(Note 5)		The Company	From All Consolidated Entities (Note 5)
								Cash	Stock	Cash	Stock
Chief Executive Officer	K.J. Wu (Note 1)	12,628	12,628	0	0	6,085	6,085	6,672	0	6,672	0	6.93	6.93	None
General Manager	Lidon Chen
Chief Operating Officer	Nester Huang
Chief Financial Officer	Eve Yang
VicePresident	Po-Wen Hsiao
VicePresident	Che-Pin Tseng
VicePresident	ChaucerChung

Note 1: No remuneration was paid to the Chief Executive Officer, K.J. Wu

(IV) Range of remuneration to President and Vice Presidents

Range of remuneration to the Company’s President and Vice Presidents	Names of President and vicepresidents	Names of President and vicepresidents
	The Company (Note 6)	From All Consolidated Entities (Note 7)E
Below NT$1,000,000	K.J. Wu(Note),Po-Wen Hsiao	K.J. Wu(Note),Po-Wen Hsiao
NT$1,000,000 ~ NT$1,999,999
NT$2,000,000 ~ NT$3,499,999	Chaucer Chung	Chaucer Chung
NT$3,500,000 ~ NT$4,999,999	Che-Pin Tseng	Che-Pin Tseng
NT$5,000,000 ~ NT$9,999,999	Lidon Chen, Eve Yang, Nester Huang	Lidon Chen, Eve Yang, Nester Huang
NT$10,000,000 ~ NT$14,999,999
NT$15,000,000 ~ NT$29,999,999
NT$30,000,000 ~ NT$49,999,999
NT$50,000,000 ~ NT$99,999,999
NT$100,000,000 and above
Total	7people	7people

Note: No remuneration was paid to the Chief Executive Officer, K.J. Wu.

Note 1: The names of general manager and assistant general managers should be separately listed and summarized to disclose the payment for each person. Note 2: Refers to the salary, differential pay for the job and severance of general manager and assistant general managers in the most recent year.

Note 3: Refers to the various rewards, bonuses, transportation, special disbursement, various allowances, housing, cars and other tangibles and other remunerations of general manager and assistant general managers in the most recent year. In the case of provision of housing, cars and other forms of transportation or personal expenditure, disclose the nature and cost of the assets provided and the rent, gasoline and other payments paid at the actual or the fair market price. If a driver is assigned to the executive, please note the Company's payment to the driver, which is not included in the remuneration here. The salary expenses recognized in accordance with IFRS2 Share-based Payment, including obtaining employee stock options, restricted stock awards, participation in new share issuance through cash capital increase, should be

20

included in the remuneration.

• Note 4: Refers to the employee remuneration (including stocks and cash), approved by the board, to be allocated to the general manager and assistant general managers in the most recent year. If the amount cannot be estimated, calculate the amount for this year based on the actual allocated amount last year.

• Note 5: The total amount of remunerations paid to the general manager and assistant general managers of the Company by all companies (including the Company) shall be disclosed in the consolidated report.

• Note 6: The total amount of various types of remunerations paid by the Company to the president and each vice president and disclose the names in the specified pay grades. The amount disclosed in the table is the actual payment for 2022.

• Note 7: The total amount of various types of remunerations paid by all companies (including the Company) in the consolidated report to each one of general managers and assistant general managers should be disclosed. Disclose their names in the specified range grades.

• Note 8: The net income after tax refers to the number in the standalone financial report.

• Note 9: a. This field should clearly state the amount of remuneration paid to general managers and assistant general managers from non-consolidated affiliates or parent company.

• b. If the general manager or assistant general managers of the Company receive remuneration from a non-consolidated affiliates or the parent company, the amount shall be included in Field E of the appropriate grade range, and the field name should be changed to “The parent company and all non-consolidated affiliates.”

• c. Remunerations refer to remuneration, compensation (including employee, director and supervisor compensation) and allowance for business operations received by the general manager and assistant general managers of the Company who serve as directors, supervisors or managing executives of the other non-consolidated affiliates that are not subsidiaries or the parent company.

• The remunerations disclosed here in this Table are different from the incomes defined by the Income Tax Act. This Table is for the purpose of information disclosure and not for tax matters.

21

(V) Remuneration for management level - Top five

(V)Remun	eration f	or management leve		l - Topfive								Unit: NT$ Thousand
Job title	Name	Salary (A) (Note 2)		Pension (B)		Bonuses and Allowances (C) (Note 3)		Employee remuneration (D) (Note 4)				Proportion (%) of Total Remuneration (A + B + C + D) out of Net Income (Note 6)		Whether receive remuneration from non- consolidated affiliates or the parent company (Note 7)
		The Company	The Company’s financial reports (Note 5)	The Company	The Company’s financial reports (Note 5)	The Company	The Company’s financial reports (Note 5)	The Company		All companies in the Company’s financial reports (Note 5)		The Company	Tthe Company’s Company’s financial reports
								Cash	Stock	Cash	Stock
General Manager	Lidon Chen	12,497	12,497	0	0	5,995	5,995	6,672	0	6,672	0	6.87	6.87	None
Chief Operating Officer	Nester Huang
Chief Financial Officer	Eve Yang
Vice President	Chaucer Chung
Vice President	Che-Pin Tseng

• Note 1: The “Five highest paid executives” refer to the Company’s managers. Please refer to Tai-Cai-Zheng-San-Zi No. 0920001301 document published by the Securities and Futures Bureau, Financial Supervisory Commission on March 27, 2003 on the standards which define the scope of roles of managers. As for the calculation of the five highest amount in remuneration, it is the total of salary, retirement pensions, bonuses and allowances and employees' remuneration (that is, A + B + C + D) recorded on the consolidated financial reports received by the Company's managers, which are then ranked to show the managers who have the five highest figure in remuneration.

• Note 2: Refers to the salary, differential pay for the job and severance of five highest paid managers in the most recent year.

• Note 3: Refers to the various rewards, bonuses, transportation, special disbursement, various allowances, housing, cars and other tangibles and other remunerations of the five highest paid managers in the most recent year. In the case of provision of housing, cars and other forms of transportation or personal expenditure, disclose the nature and cost of the assets provided and the rent, gasoline and other payments paid at the actual or the fair market price. If a driver is assigned to the executive, please note the Company's payment to the driver, which is not included in the remuneration here. The salary expenses recognized in accordance with IFRS 2 Share-based Payment, including obtaining employee stock options, restricted stock awards, participation in new share issuance through cash capital increase, should be included in the remuneration.

• Note 4: Refers to the employee remuneration (including stocks and cash), approved by the board, to be allocated to the five highest paid managers in the most recent year. If the amount cannot be estimated, calculate the amount for this year based on the actual allocated amount last year and then fill out Table 1-3.

• Note 5: The total amount of remunerations paid to the five highest paid managers of the Company by all companies (including the Company) shall be disclosed in the consolidated report.

• Note 6: The net income after tax refers to the number in the standalone and individual financial reports.

• Note 7: a. This field should clearly state the amount of remuneration paid to the five highest paid managers from non-consolidated affiliates or the parent company. (Please fill in “None,” if there is none).

• b. Remunerations refer to remuneration, compensation (including employee, director and supervisor compensation) and allowance for business operations received by the five highest paid managers of the Company who serve as directors, supervisors or managing executives of the other non-consolidated affiliates that are not subsidiaries or the parent company.

• The remunerations disclosed here in this Table are different from the incomes defined by the Income Tax Act. This Table is for the purpose of information disclosure and not for tax matters.

22

(VI) Names of managers who are assigned employee compensation and the assignment

(VI) Names	of managers who are assigned employee compensation and the assignment	of managers who are assigned employee compensation and the assignment	of managers who are assigned employee compensation and the assignment	of managers who are assigned employee compensation and the assignment	of managers who are assigned employee compensation and the assignment	of managers who are assigned employee compensation and the assignment
	As of March 31,2024 Unit: NT$Thousand
	Job title(Note 1)	Name(Note 1)	Stock	Cash	Total	Total as apercentage of net income(%)
Managerial Officer	General Manager	LidonChen	-	6,672	6.672	1.82
	Chief Operating Officer	Nester Huang
	Chief Financial Officer	Eve Yang
	Vice President	Chaucer Chung
	Vice President	Che-Pin Tseng

Note 1: Names and titles can be disclosed separately and the profit distribution can be summarized in an aggregate amount.

• Note 2: Refers to the employee remuneration (including stocks and cash), approved by the board, to be allocated to the executive managers in the most recent year. If the amount cannot be estimated, calculate the amount for this year based on the actual allocated amount last year. The net income after tax refers to the number in the standalone financial report.

• Note 3: The applicability for managers is based on Document No. 0920001301 of Tai-Cai-Zheng-San-Zi No. announced by the Financial Supervisory Commission on March 27, 2003. (1) General manager and the equivalent position levels (2) Assistant general manager and the equivalent position levels (3) Department directors and the equivalent position levels (4) Head of the Finance Department (5) Head of the Accounting Department (6) Other people who manage matters for and sign on behalf of the Company.

Note 4: For the directors, general manager and assistant general managers who receive employee remuneration (including stocks and cash), this Table will be filled out.

• (VII) Analysis of the total remuneration paid, as a percentage of net income in the standalone financial report, to the Company’s board directors, the general manager and assistant general managers during the most recent two years by the Company and all companies included in parent company only statements

Unit: NT$ Thousand; %

							Unit: NT$ Thousand; %	Unit: NT$ Thousand; %
Items Year	Total compensation for directors		Total compensation for President and vice presidents		Total compensation		Total amount as % of net income of the Company and on the consolidated financial statements
	The Company	All companies included in consolidated statements	The Company	All companies included in consolidated statements	The Company	All companies included in consolidated statements	The Company	All companies included in consolidated statements
2022	18,230	18,230	39,774	39,774	58,004	58,004	8.24	8.24
2023	16,320	16,320	19,381	19,381	35,701	35,701	9.75	9.75

The remuneration policies, standards and packages, the procedure for determining remuneration and its linkage to the Company's operating performance and future risks:

1. The director remuneration is determined in accordance with the Articles of Incorporation, and is no more than 2% of the profit of the year. The Remuneration Committee deliberates on the amount, which is then submitted to the board for resolution.

2. The appointment, remuneration, and dismissal of the president and vice presidents are subject to the Company’s regulations, and remuneration is paid according to their contribution, performance, duties and service tenure. The Remuneration Committee deliberates on the standard of remuneration for the president and vice presidents, which is then submitted to the board for resolution.

3. The Company’s main principle for remuneration is to connect duties and performance results, and provide remuneration relatively competitive to attract and retain talents.

23

IV. Implementation status of corporate governance

(I) Operation of the Board of Directors

The Board of Directors met seven times in 2023 and the attendance of directors was as follows:

Job Title	Name	Actual Attendance in Person (B) 7	Number of proxy attendants 0	Actual Attendance in Person (%), (B/A)	Note
Chairman	Sean Chen			100
Director	Fushuo Investment Co., Ltd. Representative: Martin Chu	3	3	100	Dismissed after full re-election on May 24, 2023; three attendance required.
Director	Lidon Chen	7	7	100
Director	Chao-Yi Wu	7	7	100
Director	Youe Chung Capital Corporation Representative: Ming- ChungChang	4	4	100	Took office after full re-election on May 24, 2023; four attendance required.
Independent Director	Wei-Chen Wang	7	7	100
Independent Director	Huan-Kuei Cheng	7	7	100
Independent Director	Hui-Fen Chan	7	7	100
Other matters that shall be recorded: I. If the Board of Directors operations encounter any of the following situations, it shall state clearly the Board meeting date, term, proposal content, all of the independent directors’ opinion, and the Company’s handling of the opinion of the independent director: 1. Matters listed in Article 14-3 of the Securities and Exchange Act: The Company has established an Audit Committee, and Article 14-3 of the Securities and Exchange Act does not apply. For the explanation on the matters listed in Article 15-5 of the Securities and Exchange Act, please refer to the information on the operation of the Audit Committee in this year's annual report. (p. 21) 2. Other BOD resolutions to which objections or qualified opinions for the record or in writing are expressed by independent directors: None. II. For the recusal of directors due to conflicts of interest, please describe the name of the director, the proposal content, the reason for recusal and theparticipation in voting: Board Meeting Date Name of director Content of proposal Reasons for recusal Participation in voting March 3, 2023 Director Lidon Chen Appointment of directors and president of subsidiaries. The legal representative of Youe Chung Capital Corporation, serves as the director of Moment Semiconductor,Inc. Did not participate in discussion and voting April 14, 2023 Director Lidon Chen Proposal to transfer the Company’s treasury shares to employees. Director, Lidon Chen, recused due to conflicts of interest. Did not participate in discussion and voting August 4, 2023 Director Lidon Chen Deliberating 2022 distribution of employee remuneration for managerial officers and director remuneration. Director, Lidon Chen, recused due to conflicts of interest. Did not participate in discussion and voting November 8, 2023 Director Lidon Chen Proposal to participate in the capital increase by cash in the subsidiary, Pilot Battery Co.,Ltd. Director, Lidon Chen, recused himself from the discussion as he served as a director of Pilot. Did not participate in discussion and voting November 8, 2023 Director, Chao-Yi Wu Proposal to participate in the capital increase by cash in the subsidiary, Pilot BatteryCo.,Ltd. Director, Chao-Yi Wu recused himself recused himself from the discussion as he served as a major shareholder and director of Pilot. Did not participate in discussion and voting

24

• III. Self-assessment by the Board of Directors, its evaluation cycle, scope of assessment, method, and assessment contents: 1. Evaluation cycle and period:

  • The Company shall hold the Board of Directors performance evaluation at least once a year, current year performance evaluation shall be carried out at the end of the year as the evaluation cycle based on the evaluation procedures and indicator. Assessment results shall be reported to the Board of Directors in the 1st quarter of the following year.

• Scope and method of assessment: The scope of the Company’s Board of Directors’ performance evaluation includes performance evaluation for overall Board of Directors, functional committees (including Audit Committee and Remuneration Committee) and individual board members. Methods can be internal self-assessment by the board, selfevaluation by board members or other appropriate methods to conduct performance evaluation.

• Evaluation contents:

  • (1) Board performance evaluation: Includes the level of participation in the operation of the Company, improvement of the quality of the board of directors' decision making, composition and structure of the board of directors, election and continuing education of the directors and internal control.

  • (2) Individual board member performance evaluation: Includes the alignment of the goals and missions of the Company, awareness of the duties of a director, level of participation in the operation of the Company, management of internal relationship and communication, the director's professionalism and continuing education and internal control.

• IV. Targets and implementation status evaluation of strengthening the functional competence of the Board of Directors in current year and the most recent fiscal year:

• The Company has formulated the “Rules of Procedure for Board of Directors Meetings” in accordance with Paragraph 8, Article 26-3 of the Securities and Exchange Act for compliance.

• The Company has established an remuneration committee on December 28, 2011, which determines and regularly reviews the remuneration to directors and managerial officers, and regularly reviews the policies, systems, standards and structure of performance appraisal and salary remuneration of directors and managerial officers.

• The Company has established its Audit Committee on June 23, 2017, which performs its duties specified in the Securities and Exchange Act, the Company Act and other laws and regulations.

• In order to put corporate governance into practice and strengthen board functions, the Company formulated the Board and Functional Committee Performance Appraisal Measures on May 6, 2020. The internal board performance appraisal is conducted (subject to the appraisal procedures and indicators) at least once a year, and once every three years by external independent specialized institution or teams of external experts and scholars, and the results are reported to the board in the first quarter of the next year. The results of the 2023 self-evaluation of the board and functional committees are “Excellent”, and there are no improvements needed. The results have been reported to the board meeting on March 6, 2024.

(II) Implementation of 2023 Board of Directors’ performance evaluation

Evaluation cycle	Assessment duration	Scope of assessment	Assessment methods	Assessment contents	Assessment result
Conduct once a year	January 1, 2023 - December 31, 2023	Board of Directors as a whole	Internal self- evaluation of the Board of Directors	Board performance evaluation: Includes the level of participation in the operation of the Company, improvement of the quality of the board of directors' decision making, composition and structure of the board of directors, election and continuing education of the directors and internal control.	Self-evaluation by the board: An average score of 4.82, the result is considered excellent, in line with the corporate governance requirements.
	January 1, 2023 - December 31, 2023	Each individual director	Self- evaluation of directors	Individual board member performance evaluation: Includes the alignment of the goals and missions of the Company, awareness of the duties of a director, level of participation in the operation of the Company, management of internal relationship and communication, the director's professionalism and continuingeducation and internal control.	Self-evaluation by the board members (self- or peer-evaluation): An average score of 4.87, the result is considered excellent, in line with the corporate governance requirements.
	January 1, 2023 - December 31, 2023	Each functional committee	Self- evaluation of committee member	Functional committee performance appraisal: The participation in the operation of the Company, awareness of the duties of the functional committee, improvement of quality of decisions made by the functional committee, makeup of the functional committee and election of its members and internal control.	1. Self-evaluation of the Audit Committee: An average of 5. 2. Self-evaluation of Remuneration Committee: An average of 4.99. The results are considered excellent, in line with corporate governance requirements.

25

(III) Operations of the Audit Committee

The 2nd and 3rd Audit Committee held meetings six times (A) in 2023, and the attendance of independent directors is shown as follows:

Job Title	Name	Attendance in person (B)	Attendance by proxy Times	Percentage of actual attendance (%) (B/A)	Note
Independent Director	Wei-Chen Wang	6	0	100
Independent Director	Huan-Kuei Cheng	6	0	100
Independent Director	Hui-Fen Chan	6	0	100
Other matters that shall be recorded: I. If the Audit Committee operations encounter any of the following situations, it shall state clearly the Audit Committee meeting date, term, proposal content, resolution results of the Audit Committee meeting, and the Company’s handling of the opinion of the Audit Committee: 1. Items listed in Article 14-5 of the Securities and Exchange Act: Meeting Date Content of proposal Any objection, expression of reservations or significant recommendations by independent directors Results of the Audit Committee’s resolution Company’s response to the Audit Committee’s opinions 16th meeting of the 2nd Audit Committee March 4, 2023 (1) 2022 business report and financial statements. (2) Proposed to not continue the issue of common shares by private placement approved by the 1st extraordinary general meeting in 2022. (3) Proposed to Issue common shares by private placement. (4) Amendment to provisions of the Articles of Incorporation. (5) The Company’s 2022 Internal Control System Validity Evaluation and Declaration of Internal Control System. (6) Endorsements/guarantees for subsidiary Miracle Technology CO., LTD. (7) Appointment and remuneration of CPAs in 2023. None Unanimous vote by all attending committee members to approve the proposal after the chairperson consulted with the members. Not applicable The 17th meeting of the 2nd term April 14,2023 Proposal to transfer the Company’s treasury shares to employees. The 18th meeting of the 2nd term May5,2023 The Company’s Q1 2023 financial report. The 13th meeting of the 2nd term August 4,2023 The Company’s Q2 2023 financial report. The 14th meeting of the 2nd term November 8,2023 The Company’s Q3 2022 financial report. 2. Besides the abovementioned items, resolutions that are passed by more than two-thirds of all of the directors but not passed by the Audit Committee: None. II. For the recusal of independent directors due to conflicts of interests, please describe the name of the independent director, the proposal content, the reason for recusal and the participation in voting: There have been no occurrences of situations for the recusal of independent directors due to conflicts of interests, therefore, not applicable. III. Communications situations among independent directors, internal audit officer and accountant (including communications on the company finance and business situation, the major events, method and results): 1. Important highlights of the communications between independent directors and internal audit officer Date Important highlights of the communications March 4, 2023 (1)Aggregated report on 2022 Audit items and deficiencytrackingimprovement status (2) 2022 Internal Control System Validity Evaluation and Declaration of Internal Control System.

Meeting Date	Content of proposal	Any objection, expression of reservations or significant recommendations by independent directors	Results of the Audit Committee’s resolution	Company’s response to the Audit Committee’s opinions
16th meeting of the 2nd Audit Committee March 4, 2023	(1) 2022 business report and financial statements. (2) Proposed to not continue the issue of common shares by private placement approved by the 1st extraordinary general meeting in 2022. (3) Proposed to Issue common shares by private placement. (4) Amendment to provisions of the Articles of Incorporation. (5) The Company’s 2022 Internal Control System Validity Evaluation and Declaration of Internal Control System. (6) Endorsements/guarantees for subsidiary Miracle Technology CO., LTD. (7) Appointment and remuneration of CPAs in 2023.	None	Unanimous vote by all attending committee members to approve the proposal after the chairperson consulted with the members.	Not applicable
The 17th meeting of the 2nd term April 14,2023	Proposal to transfer the Company’s treasury shares to employees.
The 18th meeting of the 2nd term May5,2023	The Company’s Q1 2023 financial report.
The 13th meeting of the 2nd term August 4,2023	The Company’s Q2 2023 financial report.
The 14th meeting of the 2nd term November 8,2023	The Company’s Q3 2022 financial report.

26

May 5, 2023	(1) Aggregated report on Q1 2023 Audit items and deficiency tracking improvement status
	(2)Report on the integration of auditor manpower of theGroup.
August 4, 2023	(1) Aggregated report on Q2 2023 Audit items and deficiency tracking improvement status
November 8, 2023	(1) Aggregated report on Q3 2023 Audit items and deficiency tracking improvement status
	(2)Report on the Group’s audit implementation.
	(3) 2024 Audit Plan.
The Company’s internal audit officer communicates the auditor’s report results with the audit committee, and reports to the audit committee at the quarterly meetings. If special circumstances arise, the internal audit officer will report to the audit committee immediately. There are no occurrences of special circumstances in the year of 2022. Communications between the Company’s Audit Committee and the Internal audit officer have been well.

2.	Important highlights of the communications between independent directors and accountant	Important highlights of the communications between independent directors and accountant
	Date	Important highlights of the communications
	March 4, 2023	The CPAs expressed opinions of the review results for the Company’s 2022 Consolidated/Standalone Financial Statements, and discussed them with the independent directors.
	May 5, 2023	The accountant expressed opinions of the review results for the Company’s Q1 2023 Consolidated Financial Statements,and discussed them with the independent directors.
	August 4, 2023	The accountant expressed opinions of the review results for the Company’s Q2 2023 Consolidated Financial Statements,and discussed them with the independent directors.
	November 8, 2023	The CPAs expressed opinions of the review results for the Company’s Q3 2023 Consolidated Financial Statements,and discussed them with the independent directors.
	The Company’s certified public accountants (CPA) will report the audit or review results of the current quarter’s financial statement during the audit committee’s quarterly meetings, and other communications items of requirements by related laws and regulations. If special circumstances arise, the CPA will report to the audit committee immediately. There are no occurrences of the abovementioned special circumstances for the year of 2023. Communications between the Company’s Audit Committee and CPA have been well.

27

(IV) Composition, job duties of Remuneration Committee and implementation status:

1. Information of the members of the Remuneration Committee

Identity	Criteria Name	Having more than 5 years’ work experience and professionalqualifications listed below	Having more than 5 years’ work experience and professionalqualifications listed below	Having more than 5 years’ work experience and professionalqualifications listed below	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Compliance of independence (Note)	Number of listed companies that the members of the Remuneration Committee concurrently serve in	Note
		Lecturer (or above) of commerce, law and finance, accounting, or any subject relevant to the company’s operations in a public or private tertiary institution	Judge, prosecutor, lawyer, accountant, or holder of national exam or professional qualification relevant to the company’s operations	Commercial, legal, financial, accounting or other work experiences required to perform the Company’s operations	1	2	3	4	5	6	7	8	9	10
Independent Director	Wei-Chen Wang														-
Independent Director	Huan-Kuei Cheng														-
Independent Director	Hui-Fen Chan														-
Others	Chi-Jen Chou														1
Note: A “” is placed in the box if the members met the following conditions during active duty and two years prior to the date elected. (1) Not employed by the Company or any of its affiliated companies. (2) Not a director or supervisor of the company or any of its affiliates (The same does not apply, however, in cases where the person is an independent director of the company, its parent company, a subsidiary or a related company under the same parent company, as appointed in accordance with these regulations or with the laws of the country of the parent company or subsidiary.) (3) Does not hold more than 1% of the Company’s outstanding shares in their own names or under the name of spouse, underage children, or proxy shareholder; nor is a top-10 natural-person shareholder of the Company. (4) Not a spouse, relative within the second degree of kinship or lineal relative within the third degree of kinship, of any of the above persons listed in Subparagraph (2) and (3) or of the manager listed in (1). (5) Not directly owning 5% or more of the Company's total issued shares or one of the top five shareholders in terms of the number of shares owned, and not a director, supervisor or employee of a corporate shareholder who is designated as the Company’s director or supervisor in accordance with Paragraph 1 or 2, Article 27 of the Company Act (The same does not apply, however, in cases where the person is an independent director of the company, its parent company, a subsidiary or a related company under the same parent company, as appointed in accordance with this regulations or with the laws of the country of the parent company or subsidiary.) (6) Not a director, supervisor or employee of another company or institution in which the majority of board seats or voting rights are controlled by the same person in the Company (The same does not apply, however, in cases where the person is an independent director of the company, its parent company, a subsidiary or a related company under the same parent company, as appointed in accordance with these regulations or with the laws of the country of the parent company or subsidiary.) (7) Not a director, supervisor or employee of another company or institution, who is also the chairperson, general manager or equivalent position, or a spouse of these personnel, of the Company (The same does not apply, however, in cases where the person is an independent director of the company, its parent company, a subsidiary or a related company under the same parent company, as appointed in accordance with these regulations or with the laws of the country of the parent company or subsidiary.) (8) A director, supervisor, manager or a shareholder with over 5% ownership of a company or institution which does not have financial or business dealings with the Company (The same does not apply, however, in cases where the specified company or institution holds 20% or more and no more than 50% of the total number of issued shares of the Company, and the person is an independent director of the Company, its parent company, a subsidiary or a related company under the same parent company, as appointed in accordance with this regulations or with the laws of the country of the parent company or subsidiary.) (9) Not a professional individual or an owner, partner, director, supervisor or officer of a sole proprietorship, partnership, company or institution that, provides auditing or commercial, legal, financial, accounting services, which receive less than NT$500,000 in accumulated remuneration over the most recent two years, to the company or to any affiliate of the company or a spouse thereof. This excludes roles as Remuneration Committee, Public Acquisition Review Committee or M&A Special Committee member appointed in accordance with the Securities and Exchange Act or Business Mergers and Acquisitions Act. (10) Does not meet any of the conditions stated in Article 30 of The Company Act.

28

2. Information on the operational status of the Remuneration Committee

• (1) The Remuneration Committee has 3 members, and there are 3 incumbents as of the publication date of the annual report.

• (2) The term of the current members: From May 6, 2020 to May 5, 2023. The Remuneration Committee

convened four meetings in 2023 (A). The qualifications and attendance of the members are as follows:

Job Title	Name	Actual number of attendants (B)	Number of proxy attendants	Percentage of actual attendance (%)(B/A)	Note
Convener	Huan- Kuei Cheng	4	0	100%
Committee member	Chi-Jen Chou	4	0	100%
Committee member	Wei-Chen Wang	4	0	100%
Committee member	Hui-Fen Chan	4	0	100%
Other matters that shall be recorded: I. If the board of directors does not adopt or revise the suggestions of the Remuneration Committee, the date, session, content of proposals, resolutions of the board of directors and the Company’s handling of the opinions of the Remuneration Committee shall be stated (If the salary and remuneration approved by the Board of Directors is more than the recommended amount by the Remuneration Committee, explanation for the differences and reason are expected): None. II. The resolved matters by the Remuneration Committee about which a member expresses an objection or reservation that has been included in records or stated in writing shall state the date, session, content of proposals, all of the members’ opinions and the handling of the opinions of the members: There have been no situations of objections or reservation of opinions by the committee members for each of the discussion. III. Proposals and resolution outcome of the Remuneration Committee meeting, and handling of the committee members’ opinion bythe company: Meeting date Term Content of proposal Committee members’ opinions Company’s handling of the members' opinions Resolution outcome March 3, 2023 The 15th meeting of the 5th term (1) Proposal for the payment of remuneration of Che-Wei, Lin, President of Pilot Battery, and De-Hung Yang, President of Moment Semiconductor, Inc. (2) Distribution of employees and directors’ remuneration for 2022 Approved by all committee members Not applicable Approved April 14, 2023 The 16th meeting of the 5th term (1) According to the Company’s “Policy on Transfer of Share Buyback to Employees,” the Company plans to transfer to managerial officers for its 29th share buyback. Approved by all committee members Not applicable Approved August 4, 2023 The 1st meeting of the 6th term (1) Distribution of 2022 employee remuneration for managerial officers. (2) Distribution of 2022 board remuneration. Proposal for payment of remuneration to Shou- Yi Tseng, President of Aptos Technology, and Chaucer Chung, Vice President of Business, TMC. Approved by all committee members Not applicable Approved October 4, 2023 The 2nd meeting of the 6th term (1) Proposal for payment of remuneration to Chien-Li Cheng, Pilot Battery Co.,Ltd. Approved by all committee members Not applicable Approved

3. Duty of the Salary and Compensation Committee

• According to the Company’s Remuneration Committee Foundation Principles, the Committee shall have the loyalty and shall exercise the due care of a good administrator in conducting the following job responsibilities as listed in the Foundation Principles and submit the suggestions to the board of directors for discussion:

29

• (1) Establish and conduct regular review of directors’ and managers’ performance assessment and compensation policies, systems, standards and structures.

• (2) Conduct regular assessment of compensation for the Company’s directors and managers.

• The committee member shall carry out the aforesaid duty based on the following principles:

• (1) The performance evaluation of the directors and managers and their salary and compensation shall be considered in reference to the payment standard among industry peers and individual performances, in relevance to its reasonableness with the Company’s operations performance and future risks.

• (2) Shall not lead directors and managers to pursue salary and compensation, engaging in risky conducts that outstrip the company’s capacity to handle.

• (3) The bonus proportion of short-term performance for directors and senior level managers and partial changes to remuneration payment time shall be decided in consideration of the industrial characteristics and the nature of the Company’s business.

The remuneration in the above two subparagraphs, includes cash remuneration, stock warrants, employee stock bonus, retirement scheme or post-employment benefit, various allowance and other measures with substantial incentives; its scope shall be consistent with the directors and managers remunerations as mentioned in the Regulations Governing Information to be Published in Annual Reports of Public Companies.

The Board of Directors will not adopt or revise the suggestions by this Committee, it shall be passed by the consent of more than half of the attending directors with more than two-thirds of all directors attending the meeting, and will, during the resolution, provide specific explanation of the remuneration proposal whether it is or it is not more than the amount as suggested by this committee based on overall consideration of the aforesaid items.

If the remuneration that the Board has passed is more than the amount suggested by this Committee, in addition to including the reasons for differences in records, the Company shall submit this information to the website designated by the competent authority within two days from the day the remuneration is passed.

For subsidiaries of the Company, based on its division of responsibilities, any matters to be resolved that require a decision by the Board of Directors, shall first be sent to this Committee for suggestions, followed by submission to the Board of Directors for discussion.

• (V) The succession planning for the board members and important management executives In response to the Group’s development needs, it is necessary to recruit and nurture key talents immediately; in this regard, the Company has been continuously nurturing successors. In the succession planning, the successor must possess the common values of Integrity, Prompt Decision Making and Agility, Teamwork and Collaboration with customers, and Customer loyalty. The Company leverages the regular meetings with the managers of various departments convened by the president. Each department will report on its operations status and describe its short, medium term objective execution plan, and to find a common ground in order to achieve the targets set by the company. The Company also organizes production and sales meetings on a weekly basis convened by senior management, during which sales and related information, production line operations status, raw materials preparation status of the customer demands will be reported, so that decisions are made quickly through effective communications and discussions. In addition, the Company will organize educational training for senior management, as well as the consensus building camps for officers from time to time, so as to build the shared visions and values, while enhancing the professional capabilities in management, professionalism and decision-making. In addition, the Company also actively builds an attractive and growth-oriented environment for all kinds of talents. Succession planning for board members is due to the fact that the overall operations management is becoming more complex as the Group’s operations are growing on a daily basis. The Board of Directors considers the requirements of the Group’s long-term business development, recruits industrial representatives with great work and education experience and moral character as the Company’s director. Each of the directors is familiar with corporate governance, and each has their expertise area which can continue to provide the company operator management strategies and corporate governance advices, effectively monitors the company’s management and operations outcomes. Directors attended timely training for related laws and regulations to fulfill the duties of the Board.

30

(VI) Continuing education of the directors and managerial officers in the recent fiscal year

Job title	Name	Date of training course	Date of training course	Organizer	Course title	Number of hours for continuing education
		Begin	End
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
Chairman	Sean Chen
		December 8,2023	December 8,2023	Securities and Futures Institute,R.O.C.	2023 Promotional Seminar for Insider EquityTrading	3
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
Director
General	Lidon Chen
Manager
		October 20, 2023	October 20, 2023	Securities and Futures Institute, R.O.C.	2023 Promotional Seminar for Insider Trading Prevention	3
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
Representative
of legal entity	Ming-Chung Chang
director
		November 29,2023	November 29,2023	Securities and Futures Institute,R.O.C.	2023 Promotional Seminar for Insider EquityTrading	3
Director	Chao-Yi Wu	September 23, 2023	September 23, 2023	Securities and Futures Institute, R.O.C.	Seminar of Corporate Sustainable Development Best Practice	3
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
		October 20, 2023	October 20, 2023	Securities and Futures Institute, R.O.C.	2023 Promotional Seminar for Insider Trading Prevention	3

31

Job title	Name	Date of training course	Date of training course	Organizer	Course title	Number of hours for continuing education
		Begin	End
Independent Director	Wei-Chen Wang	August 2, 2023	August 2, 2023	Taiwan Corporate Governance Association	The governance strategy of information security of TWSE/TPEX listed companies from the perspective of sustainable development of ESG companies	3
		September 20, 2023	September 20, 2023	Taiwan Investor Relations Institute	How do enterprises innovate and break through profitability in the digital economyera	3
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
		November 2, 2023	November 2, 2023	Taiwan Corporate Governance Association	How do directors and supervisors supervise risk management and crisis management, s well as strengthen corporate governance	3
Independent Director	Huan-Kuei Cheng	October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3
		October 20, 2023	October 20, 2023	Securities and Futures Institute	2023 Promotional Seminar for Insider Trading Prevention	3
		November 22,2023	November 22,2023	Securities and Futures Institute	2023 Promotional Seminar for Insider EquityTrading	3
Independent Director	Hui-Fen Chan	July 4, 2023	July 4, 2023	Stock Exchange	2023 Cathay Sustainable Finance and Climate Change Summit	3
		August 3, 2023	August 3, 2023	Taiwan Corporate Governance Association	Ethical corporate management and the analysis and decision-making application of corporate financial information	3
		September 7, 2023	September 7, 2023	Taiwan Corporate Governance Association	The strategy and practice of dual transformation of sustainability and digital information security	3
		October 4, 2023	October 4, 2023	Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations	3

32

Job title	Name	Date of trainingcourse	Date of trainingcourse	Organizer	Course title	Number of hours for continuing education
		Begin	End
Chief Financial Officer & Corporate Governance Officer & Accounting Officer	Eve Yang				Resonance of Public
					Opinion - Path of
		September	September	Taiwan Investor Relations
					Cooperation among Investor	3
		26, 2023	26, 2023	Institute
					Relations,the Government
					and the Media
				Corporate Operating and Sustainable Development Association	Taiwanese businesses’ operation and merger and acquisition strategy from the perspectives of global political and economic situations
		October 4,	October 4,			3
		2023	2023
				Securities and Futures Institute	2023 Promotional Seminar for Insider Trading Prevention
		October 20,	October 20,			3
		2023	2023
		November	November	Securities and Futures Institute	2023 Promotional Seminar for Insider EquityTrading
						3
		22,2023	22,2023
		December	December		Advanced Education Course
				Shih Chien University		12
		13,2023	14,2023		for AccountingOfficer

33

(VII) Status of corporate governance implementation and the differences from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and the reasons

Companies and the reasons
Assessment items	Operationalstatus			Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
I. Does the Company stipulate and disclose the corporate governance practice principles in accordance with the “Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies”?	V		The Company has adopted corporate governance best practice principles approved by the Board of Directors, and disclosed on the company’s website.	No significant differences
II. The shareholding structure of the Company and shareholders' rights and interests (I) Does the company stipulate internal operating procedures to process matters in regard to the shareholders’ recommendations, doubts, disputes and litigation, and conduct implementation based on these procedures?	V		(I) The Company has a spokesperson who can handle the suggestions, questions and disputes of shareholders. If there are any dispute matters, the Company’s legal team will take over for handling.	No significant differences
(II) Does the Company have a list of major shareholders who actually control the company and a list of shareholders who ultimately control these major shareholders?	V		(II) For a shareholding situation whereby there are directors, managers and main shareholders with over 10% shareholding, such information will be submitted and disclosed on the website of Market Observation Post System in a timely fashion according to legal requirements.
(III) Does the Company create and implement risk control and firewall mechanisms with its affiliates?	V		(III) The Company has formulated monitoring and governance procedures for subsidiaries, procedures for lending capital and endorsements/guarantees, asset acquisition and disposal procedures and so on related internal procedures, so as to establish appropriate risk management control and firewall. Audit personnel regularlymonitortheimplementationstatus.
(IV) Does the Company stipulate internal regulations that prohibit insiders from buyingand sellingsecurities with the	V		(IV) The Company has formulated Procedures for Handling Material Inside Information and policies to prevent insider trading.

34

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
unpublished information on the market?
III. Composition and responsibilities of the board of directors (I) Does the board of directors stipulate and implement a diverse policy regarding the composition of the board members? (II) Other than the establishment of a Remuneration Committee and Audit	V	V	(I) The Company’s board has seven members (including three independent directors), whose expertise covers technology industry, strategy and operation management, sales, finance, accounting, auditing, legal affairs, corporate governance, and sustainability. The Company has formulated a diversification policy for the composition of the board and has implemented accordingly, refer to Article 20 of the Company’s Corporate Governance Code of Conduct for the diversification policy, which has been disclosed on the Company’s website simultaneously. There are a total of seven members (including three independent directors) for the Company’s 13th Boards of Directors members, expertise covering industrial and finance, accounting and business, fulfilling the diversification of Board members. Sean Chen, Lidon Chen, Ming-Chung Chang, Chao-Yi Wu, all of whom are skilled in leadership, business judgment, management, crisis management, and have industry knowledge and international market perspectives; Wei-Chen Wang, a certified public accountant with extensive experience in industry, accounting and finance; Peter Cheng, a former university professor and director and supervisor of the National Chung-Shan Institute of Science and Technology with experience in industry and academia; and Hui-Fen Chan is a practicing attorney in Taiwan and New York State of the US, and has worked in the semiconductor industry, and she also has extensive business, legal and industry experience. Specific management objectives of the diversification policy and the current status: (II) Besides the establishment of a Remuneration Committee and Audit Committee, the Company will establish other functional committees in the future based on the considerations of the company’s Diversity policyandmanagementobjective Achievement There should be at least three independent directors, accounting no lessthan 1/5 of the board seats. Achieved The number of directors taking concurrent positions as the Company’smanagers shall notexceed1/3 of the board seats. Achieved At least two seats of female directors. Achieved Diversification ofprofessional capabilities Achieved	No significant differences

35

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
Committee which are required by law, does the Company plan to set up other functional committees? (III) Does the Company stipulate performance assessment regulations and assessment methods for the board of directors and conduct the performance assessment on a yearly basis, and was the result of performance assessment reported to the board of directors for the reference of individual directors' salary and nomination of reappointment? (IV) Does the company regularly evaluate its certifiedpublic accountant’s	V V		operational requirements. (III) Pursuant to the “Rules for Performance Evaluation of Board of Directors and Functional Committees”, the internal performance evaluation is conducted for the Board and functional committees at least once a year, and once every three years by external independent specialized institution or teams of external experts and scholars. During the evaluation period, the performance evaluation shall be conducted at the end of each year pursuant to the Rules. The results are reported to the board in the first quarter of the next year. Measurement items of the Board’s performance assessment to include five major aspects as below: I. Level of participation in business operations of the Company. II. Improve the decision-making quality of the board of directors. III. Composition and structure of the board of directors. IV. Election and continuing education of the directors. V. Internal control. Measurement items of the directors’ performance assessment to include six major aspects as below: I. Understand the objectives and mission of the Company. II. Understanding of directors’ job responsibilities. III. Level of participation in business operations of the Company. IV. Internal relationship management and communication. V. Professionalism and continuous education of directors. VI. Internal control. The Company’s 2023 Board of Directors performance evaluation results have been reported to the Board of Directors on March 6, 2024, and will also be used to determine the remuneration of individual directors and as the reference of nomination for re-election. The performance evaluation results of the Board of Directors and functional committees in the most recent three years are posted on the official website. (IV) The company regularly conducts a review of the CPA’s independence based on Certified Public Accountant Act and The Norm of Professional Ethics for Certified Public Accountant.

36

Assessment items				Operationalstatus	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No		Description
independence?				The independence and suitability of the Company’s attesting CPAs are assessed in accordance with the “Corporate Governance Best Practice Principles” and the “Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies,” as well as with reference to the Audit Quality Indicators(AQIs).				Note
					Auditor independence	Independence		Note
				Item	Explanation	Yes	No
				1	The professional accountants should avoid and should not accept the engagement when they may have involved in any direct or material indirect interests which mayimpair their impartialityand independence.	V
				2	The audit or review of financial statements provides moderate but not absolute certainty to a wide range of potential users of statements. In addition to maintaining independence in fact, accountants' independence in appearance is more important. Therefore, members of the audit service team, other co- practicing accountants, firms, and firm-affiliated companies must maintain independence from audit clients.	V
				3	The accountants appointed by the Company has the following qualifications: (See 3.1~3.3 below)
				3.1	Integrity: A professional accountant should be straightforward and honest in allprofessional and business relationships.	V
				3.2	Objectivity: A professional accountant should not allow bias, conflict of interest or undue influence of others to override professional or business judgments.	V
				3.3	Independence: An accountant should maintain independence in appearance and fact when performing the audit or review of financial statements, and express opinions in a fair manner.	V
				4	The independence of accountants is related to integrity, impartiality, and objectivity. There is no lack or loss of independence of accountants at the time of appointment, which in turn affects the standpoint of integrity and objectivityand impartiality.	V
				5	The independence of accountants is not affected by self-interest, self- assessment,defense,familiarityand coercion.	V
				6	Independence beingaffected byself-interest means obtainingfinancial

37

Assessment items					Operationalstatus			Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No			Description
					benefits through the Company, or conflicts of interest with the Company due to other interest relationships. No circumstances shown as follows: (6.1~6.6 below)
				6.1	Have a direct or significant indirect financial interest relationship with the Company.	V
				6.2	Have financing or guarantee activities with the Company or its directors and supervisors.	V
				6.3	Consider thepossibilityof losingtheCompanyas a client.	V
				6.4	Have a close business relationshipwith theCompany.	V
				6.5	There is apotential employment relationshipwith theCompany.	V
				6.6	Contingent fees related to theCompany’s audit case.	V
				7	In terms of the independence being affected by self-assessment, reports or judgments made by accountants in non-audit service cases are used as an important basis for audit conclusions in the process of auditing or reviewing financial information; or that members of the audit service team have served as the Company’s directors and supervisors, or may hold positions that directly and significantly influence the audit. No circumstances shown as follows:(7.1~7.2 below)
				7.1	Members of the audit service team are currently serving or have served in the last two years as the Company’s directors, supervisors or managers, or the positions that directlyand significantlyinfluence the audit.	V
				7.2	The non-audit services provided to the Company directly affect the key matters of audit.	V
				8	Independence being affected by defense refers to that members of the audit service team become the defenders of the audit client's position or opinions, causing their objectivity to be questioned. No circumstances shown as follows:(8.1~8.2 below)
				8.1	Promote or mediate the trading of stocks or other securities issued by the Company.	V
				8.2	The accountant has acted as counsel of the Company or represented the Companyin coordinatingmatters relatingto conflicts with a thirdparty.	V
				9	Independence beingaffected byfamiliarityrefers to the close relationshipwith

38

Assessment items					Operationalstatus			Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No			Description
					the board of directors, supervisors, and managers of the Company, which makes accountants or audit service team members overly concerned with or sympathetic to the interests of audit clients. No circumstances shown as follows:(9.1~9.3 below)
				9.1	Have a family relationship with the Company’s directors, supervisors, managers,orpersons who have significant influence on the audit.	V
				9.2	A certified public accountant from the joint CPA firm, within one year after retirement, serves as the Company's director, supervisor, manager or position that has a significant influence on the audit.	V
				9.3	Accept valuable gifts or gratuity from the Company or its directors, supervisors,and managers.	V
				10	The impact of coercion on independence refers to that the members of the audit service team bear or feel intimidation from the Company that prevents them from maintaining objectivity and clarifying professional suspicions. No circumstances shown as follows:(10.1~10.2 below)
				10.1	Accountants are requested to accept improper choices made by the management in accounting policies or improper disclosures in financial statements.	V
				10.2	In order to lower audit expenses, pressure is applied on accountants to improperlyreduce the audit work that should beperformed.	V
					Competence	Requirements of competence met		Note
				Item	Explanation	Yes	No
				1	Whether theyhave accountantqualifications toperform accountingtasks.	V
				2	Whether there has been no punishment by the competent authority or the CPA association, or sanction in accordance with Paragraph 3, Article 37 of the Securities and Exchange Act. Article 37 of the Securities and Exchange Act (Regulation of CPA Auditing and Attestation) Paragraph 3 Depending upon the seriousness of mistake or omission committed bya certifiedpublic accountant in the attestation of the	V

39

Assessment items					Operationalstatus			Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No			Description
					financial reports referred to in Paragraph 1, the Competent Authority may impose any of the following sanctions: (1). Warning. (2). Suspension from practicing any attestation under this Act for a period of two years. (3). Voidance of his/her attestationpermission.
				3	Knowledge of the industryrelevant to the Company.	V
				4	Whether to perform the audit of financial statements in accordance with generally accepted auditing standards and the Regulations Governing Auditing and Attestation of Financial Statements by Certified Public Accountant, and issue financial reports in accordance with the auditplanningschedule.	V
				5	Whether taking advantage of an accountant's status to be an unfair competition in business.	V
				6	Whether the latest changes in accounting, auditing and other related laws and regulations are proactively provided to the management, and are fully discussed and communicated on major differences.	V
				Assessment result Both Ya-Hui Cheng, CPA and Chien-Yu Liu, CPA of PwC Taiwan met the requirements of independence and satisfied the evaluation criteria of suitability. The evaluation results were submitted to and approved by the Audit Committee on March 6, 2024, and deliberated and approved bythe Board of Directors on the same day.
IV. Does the listed or OTC company have qualified and suitable number of corporate governance personnel, and does the company appoint a corporate governance officer to be responsible for matters regarding corporate governance (including but not limited to providing directors with information required for the implementation of business operations, assistingdirectors to complywith laws and	V		The Company currently has established internal units to handle meeting related matters for the Board of Directors and shareholder’s meetings, to process company registration and registration of alteration, prepare meeting minutes for Board of Directors’ and shareholders’ meetings. The Company’s dedicated governance officer is responsible for corporate governance-related issues in order to protect shareholders’ rights and interests and strengthen the functions of the board. The governance officer has several years of experience in shareholder service and administration works in TWSE/TPEx listed companies, and also adheres to the philosophy of corporate governance and continues to carry out tasks required for the position. The main duties of the Company’s corporate governance personnel consist of providing directors with information required for the implementation of business operations,assistingdirectors to complywith laws and regulations,and handlingrelated					No significant differences

40

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
regulations, and preparing meeting minutes for the board of directors meeting, shareholders meeting and so on)?			matters for the board of directors meeting and shareholders meeting according to the laws and regulations, and so on. 2023 Business implementation status: 1. Assists independent directors and directors to implement business operations, provides necessary information and arranges continuous learning for directors: (1) Regularly notifies the Board members on the latest revisions to laws and regulations and its development relating to the company’s area of operations and corporate governance. (2) Monitors the confidential level of related information and provides the directors the required company information, maintaining communications among directors and every business head ensuring smooth exchanges. (3) Assists independent directors and directors to formulate annual continuing education plans and course arrangements according to the company’s industrial characteristics and the director’s experiences and background. 2. Assists in the procedures for meetings of Board of Directors and Shareholders and resolutions matters, in compliance to laws and regulations: (1) Reports to the Board of Directors, independent directors, Audit Committee on corporate governance implementation status, confirms whether the Shareholders meeting and Board of Directors meetings are convened according to the laws and regulations and the corporate governance best practice principles. (2) Assists in reminding directors the related laws and regulations for executing businesses or for making official resolutions to the Board of Directors. (3) Responsible for checking on matters relating to announcing material information of important resolutions by the Board of Directors to ensure the legality and accuracy of the material information in guaranteeing fairness on investors trading information. 3. Maintaining investor relationships: Make arrangements for directors and major shareholders, institutional investors or general shareholders for exchanges and communications when the need arises, to ensure investors obtain sufficient information to assess and decide the reasonableness of the corporate capital market value, so as to allow shareholders rights and interests are well maintained. 4. Informing directors of the formulated Board meeting agenda seven days prior to the meeting, conveningboard meetings andprovidingmeetinginformation, providingreminders beforehand where

41

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
			recusal of directors due to conflicts of interests is required for any topic discussion, and to complete board meeting records within 20 days of the meeting. 5. Registering the date of shareholders meeting in prior according to the laws and regulations, preparing meeting notice, meeting handout, and meeting records within the legal deadline, and carry out registration matters relating to revisions to Charter or re-election of directors. The training for corporate governance officer in 2023 is as follows: The governance officer completed a 12-hour professional training course on corporate governance in 2023. Please refer to “Continuing education of the directors and managers in the recent fiscal year” for details.
V. Has the Company established communication channels with stakeholders (including, but not limited to, shareholders, employees, customers and suppliers) and set up an area dedicated to stakeholders on the Company website and does the Company respond appropriately to sustainable development issues that stakeholders consider important?	V		The Company has created a website as a communications channel with the stakeholders, to provide contact methods and a designated section for stakeholders has been created, making appropriate responses to important sustainable development issues that are of concerns to the stakeholders. 1. Types of stakeholders The Company’s definition of stakeholder is “Internal and external groups or individuals who can exert influences to TMC or are subject to influence by photomask companies.” Based on this definition, the stakeholders of the Company include shareholders, investors, employees, customers, suppliers, and governance agencies and so on. 2. Topics of concerns by stakeholders After the identification of the stakeholders, various communications channels are set-up in accordance to their influences on the Company and their areas of concern. Through the well- established communications channels by the Company’s responsible units, corporate governance, economic, environment and social topics as concerned by the stakeholders are compiled. The key influences to the Company’s sustainable development as defined by the assessment of major topics of concern are “Business ethics and business integrity,” “Reducing operations impacts to the environment,” “Improving customer service satisfaction” and “Social welfare and caring.” 3. Communication channels with stakeholders	No significant differences

42

Assessment items				Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No		Description
			Contact channels	Contact method
			Relationship of shareholder and investor	Company Spokesperson: CFO Eve Yang Contact Telephone No. – (03)5634370 Ext 618 Email – eve_yang@tmcnet.com.tw Company Acting Spokesperson - Director LC Lin Contact Telephone No. – (03)5634370 Ext 135 Email – lelin@tmcnet.com.tw
			Dedicated Customer Service Section	Customer information contact - Senior Manager I-Sheng Huang Contact Telephone No. – (03)5634370 Ext 349 Email –jamesH@tmcnet.com.tw
			Supplier service section	Supplier information contact - Deputy Manager Cheng-Hung Tsai Contact Telephone No. – (03)5634370 Ext 412 Email –mike_tsai@tmcnet.com.tw
			Employee relationship	Employee relationship contact - Division Head Ya-Hui Huang Telephone – (03)5634370 ext 333 Email – where@tmcnet.com.tw
VI. Does the Company entrust a professional shareholder services agency to conduct matters regarding the shareholders meeting?	V		The Company has appointed the Shareholder Service Department, Grand Fortune Securities to handle the Company’s shareholders meeting matters.			No significant differences
VII. Information disclosure (I) Does the Company create a website to disclose information regarding its finance, business operations and corporate governance? (II) Does the Company adopt other methodologyof information disclosure	V V		(I) The Company’s website has a dedicated page to disclose information regarding its finance, business operations and corporate governance. (II) The Company has designated a personnel responsible for disclosing related information on the Market Observation Post System website on a regular basis and from time to time,has continued to			There are no significant differences with the other matters except this part where the company

43

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
(such as creating an English website, appointing a dedicated person to be responsible for the collection and disclosure of the Company’s information, implementing the spokesperson system, and uploading videos of the investor conferences on the company’s website)? (III) Has the Company published and reported its annual financial report within two months after the end of a fiscal year and published and reported its financial reports for the first, second and third quarters as well as its operating status for each month before the specified deadline?		V	monitor various outside reports and information and established the spokesperson system, all of the above based on the regulations of the Taiwan Stock Exchange. The company website is updated based on the investor conference processes. (III) The Company has announced and filed its annual financial report within 75 days after the end of the year. The first, second, and third quarter financial reports and monthly operating status have been announced earlier than the deadline.	has not yet published and reported its annual financial report within two months after the end of the fiscal year at this moment.
VIII. Does the Company have other important information that can help people to understand the operations of corporate governance (including but not limited to the employees’ rights, employee care, Investor relations, supplier relation, rights of interested parties, training status of directors and supervisors, implementation status of risk management policies and standards of risk measurement, the implementation of customer policies, the purchase of liability insurance for directors and supervisors by the Companyand so on)?	V		(I) Status of employee rights and caring for employees: Please refer to the annual report section on “Labor relations information.” (II) Status of rights and interests of the relationships with the investors, suppliers and stakeholders: Please refer to this annual report for the section on “Fulfillment of sustainable development” and the Company’s website on the “page dedicated to the stakeholders.” (III) Status of continuing education for directors: Please refer to this annual report section on “Continuing education of the directors and managers.” (IV) Status of risk management policy and risk measurement standards: Please refer to this annual report section on “Analysis and assessment of risks.” (V) The Company purchases liability insurance for all directors every year, and has reported the latest status on insurance to the board of directors on March 6, 2024.	No significant differences
IX. Please describe the improvements that have been made in response to the corporate governance evaluation results issued by the Corporate Governance Center of the Taiwan Stock Exchange in the most recentyear,andproposepriorities and measures for those notyet improved:

44

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	No	Description
The Company has undergone corporate governance evaluation in accordance with the regulations of the competent authorities. In the latest (10th) Taiwan Stock Exchange governance evaluation, the Company placed in the first 51%~65% of companies and has followed and gradually improved the corporate governance indicators issued by the Corporate Governance Center. It will review and prepare improvement plans for the items that have not yet met corporate governance standards.

45

(VIII) Fulfillment of sustainable development and differences from the Corporate Sustainable

Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons for discrepancies

The Company fulfills its sustainable development based on the following principles:

Implementation of corporate governance

The Company’s Board of Directors shall exercise the duty of care as prudent managers to supervise the Company in fulfilling its sustainable development duties, and constantly reviewing performance to ensure ongoing improvement and sound execution of the sustainable development policy.

The Company’s Board of Directors ensure fulfillment of sustainable development duties from the following aspects:

1. Incorporate sustainable development into the Company’s operational activities and development direction, and approve specific plans for the promotion of sustainable development.

2. Propose a mission (or vision or value) for sustainable development and formulate policies or management guidelines for sustainable development.

3. Ensure that information related to sustainable development is disclosed in a timely and accurate manner.

Development of sustainable environment

The Company complies with relevant environmental laws and regulations and ESG international standards to properly protect the natural environment, and strives to achieve the goals of environmental sustainability in the performance of operating activities. This year, the Company is committed to improving the utilization efficiency of various resources and the use of renewable materials with low environmental impact, making the Earth's resources more sustainable.

The Company considers impacts to ecology, promotes and educates consumers on sustainable consumption concepts, and carries out its operations activities such as R&D, production and service, in accordance to the following principles, to lower the impacts of company operations to the natural environment:

1. Reduce exhaustion of resources and energy in its products and services.

2. Reduce the release of pollutants, toxic and wastes, and shall carry out proper handling of wastes.

3. Increase recyclability and reusability of raw materials or products.

4. Optimize sustainable use of renewable resources to the maximum.

5. Extend the durability of products.

6. Increase efficacy of products and services.

In order to increase the utilization rate of water resources, the Company carries out water conservation plans to properly handle sustainable utilization of water resources and prevent pollution of water, air and land. The Company also adopts measures with the best possible pollution prevention and control technology to reduce negative impacts to human health and environment.

The Company monitors how climate change affects business activities and, based on current operations and greenhouse gas survey, develops energy/carbon reduction and greenhouse gas reduction strategies, incorporates carbon credit as part of the Company's carbon reduction strategies and enforces them accordingly to reduce impacts of the Company’s business activities on the natural environment.

Promotion of social welfare

The Company complies with relevant laws and regulations and international human rights conventions, and does not endanger the basic rights of workers. The Company’s human resource

46

policy shall abide by basic labor rights protection principles, establish appropriate management methods and procedures.

The Company provides a working environment that is safe and healthy for labor, including necessary annual health checks and emergency facilities, and is committed to reducing harmful factors to the employees’ safety and health, in order to prevent occupational hazards. At the same time, the Company should conduct regular educational training on safety and health to its employees, provide employees with a work environment that facilitates career development, and implement effective training programs to help develop the skills needed for career advancement.

The Company provides a transparent and effective consumer complaint procedures for its products and services, handling consumer appeals in a fair and timely manner, and abides by related laws and regulations to ensure respecting consumer privacy rights, protecting the personal information provided by the consumer.

Enhancing disclosure of corporate sustainability information

The Company has prepared the 2022Corporate Sustainability Report pursuant to the GRI Sustainability Reporting Standards 2021 released by the Global Reporting Initiatives (GRI) and the “Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Sustainability Reports by TWSE Listed Companies” released by TWSE, while referring to the sustainability indicators of the Sustainability Accounting Standards Board (SASB); the report was assured by PwC Taiwan. Relevant and reliable information on corporate sustainable development has been disclosed on the Company’s website and the FSC’s Market Observation Post System, and communication with stakeholders has been enhanced.

47

Implementation of promoting sustainable development and differences from the Corporate Sustainable Development Best Practice Principles for

TWSE/TPEx Listed Companies and reasons for discrepancies

Assessment items				Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no		Description
I. Has the Company established a governance structure to promote sustainable development, and set up a dedicated (part-time) unit to promote sustainable development, which is authorized by the Board of Directors to be handled by senior management, and the supervision situation of the Board of Directors?	V		(I)	The Company wants to ensure that the work environment is safe and that the employee rights are protected and respected, so as to fulfill sustainable development responsibilities, has engaged various functional departments to be responsible for management as assigned according to its business nature, which the managers will conduct reviews of the implementation results on a regular basis. Each operation meets the commitments made by the company. The Company’s promotion of sustainable department is implemented by the Group’s Environment, Safety and Engineering Division concurrently. Pursuant to the GRI Sustainability Reporting Standards 2021 released by the Global Reporting Initiatives (GRI) and the “Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Sustainability Reports by TWSE Listed Companies” released by TWSE, while referring to the sustainability indicators of the Sustainability Accounting Standards Board (SASB), the external advisors are engaged to educate and train the related units of the Company for the benchmark sustainable development for implementation. Through this method, it is sought to respond to stakeholders' concerns regarding sustainable development, publicly explain corporate sustainability in terms of economics, environment, and society, implement corporate social responsibility, and continuously move towards sustainable development. The implementation plans and results were reported to the Board of Directors on March 3, 2024. The Board of Directors has learn the progress of sustainable development implementation, and expect the continuous promotion to be superior to the legal requirements. The Company continues to drive sustainable development activities in the future. Dimension Members Work duties Corporate governance Finance organization Information disclosure, dividends policy, tax-related matters, and proper handling of issues of concerns to stakeholders, assists in strengthening the functional competence of the board, and attends to shareholders’ rights and interests. Social welfare Finance organization The finance organization as the coordinating unit in conjunction with Taiwan Mask Charity Foundation, its key functions include caring for society, community participation, welfare activities and corporate image, and the finance department’s small team function will invite related units tojoin the activities.			No significant differences
				Dimension	Members	Work duties
				Corporate governance	Finance organization	Information disclosure, dividends policy, tax-related matters, and proper handling of issues of concerns to stakeholders, assists in strengthening the functional competence of the board, and attends to shareholders’ rights and interests.
				Social welfare	Finance organization	The finance organization as the coordinating unit in conjunction with Taiwan Mask Charity Foundation, its key functions include caring for society, community participation, welfare activities and corporate image, and the finance department’s small team function will invite related units tojoin the activities.

48

Assessment items						Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no				Description
				Environmental sustainability	Operating Organization I Operating Organization II	Production processes management of photomask. Maintenance of production equipment, improvements; new factories are planned to be green buildings. Manufacturing related work, including hazardous substances management, resources. The Company integrates and promotes the Company’s environmental protection, pollution prevention, safety and health implementation, by building and verifying the ISO50001 system (from 2023), as well as the tasks related to the resource saving, communication of relevant laws and regulations, and implementation of greenhouse gas ISO14064-1 system building and verification (from 2023). Purchasing business includes suppliers management, green procurement management. Research and development of photomask, fixing abnormality of manufacturing processes, photomask finished product quality assurance, research and development of new products; related testing and certification of photomask, repair and related manufacturing processes. Promote green energy products related technologyR&D innovation.
				Customer equity	Sales Organization/ uality Assurance department	Product sales, market research and development. Formulating product specification, quality guarantee planning, customer service, storage and transportation business.
				Employee care	Human Resources department	Talent recruitment and employment, remuneration and benefits and employee well-being and safety, educational training and development, communications and rights protection, complaint procedures.
II. Does the Company conduct risk assessment on environmental, social and corporate governance issues that are relevant to its operations and stipulate risk management policies or strategies based on principles of materiality?	V		(I)	The Company has a vision of corporate development and sustainable development and understands that various risks will affect the achievement of business and operational goals. Therefore, in addition to assessing various risks based on ISO9001/ISO14001/ISO27001 systems, during the year, the ISO45001/ISO14064-1 systems have been built, to inspect and establish the risk management mechanism this year to manage various risks of the Company, and formulate improvement strategies/ mechanisms/ methods, to ensure sustainable and stable growth and the pursuit of sustainable businessgoals.				No significant differences

49

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies andreasons
	Yes	no	Description
			The Company established a “Risk Management Steering Committee” to integrate the above- mentioned system, and review and implement measures to address potential strategic, operational, financial, and hazardous risks. The Risk Management Steering Committee meets quarterly, and its members consist of the president & function head. The committee uses the Risk Map to evaluate the probability of risk events and the severity of impact on the company’s operations, define the risk level and the priority of risk control, and take corresponding risk management actions. Report annually to the Audit Committee and the Board of Directors on the Company’s risk environment, risk management priorities, risk assessment and results of countermeasures. (II) The Company evaluates and manages risks based on the materiality principle, to control the risks of the items with mid/high risks upon the risk assessment, including four major dimensions strategy, operation,finance,and hazard.
III. Environmental issues (I) Has the Company set up an environmental management system designed to industry characteristics? (II) Is the Company committed to improving resource efficiency and to the use of renewable materials with low environmental impact? (III) Has the Company assessed the current and future potential risks and opportunities from climate changes and taken measures to address climate-related issues?	V V V		(I) The Company’s environmental management system is implemented through the relevant procedures of the ISO14001 system, to identify various environmental aspects and formulate management procedures, and take into account the control and economical use of water, power, oil, and other resources to achieve the purpose of resource conservation. 1. Water resources management: Committed to raising water resources utilization, and to set short, medium and long term goals, to pursue water resources sustainable reuse as the goal. 2. Waste management: “Reducing manufacturing quantity, resource recycling” as core theme, recycling and reuse is the priority option in waste management (II) The Company has been committed to improving the efficiency of various resources for a long time. In addition to saving power by 1% per year as required by the Bureau of Energy, and establishing power-saving plan targets every year, we also use the central monitoring system, to collect big data to improve operational management, while improving the energy utilization efficiency by replacing with the highly energy-efficient equipment, or installation of frequency converters on rotating equipment; also, through the energy-saving and tracing meeting, it is sought to utilize the energies and resources in the most efficient manner, to reduce waste and carbon. Pursuant to the Company’s commitment in the environment, safety, and health policy, raw materials that reduce environmental impact are used, waste is recycled, reduced, and reused. (III) The Company has conducted assessment of current and future potential risks and opportunities arising from climate change to the enterprise, and adopts it into risk management, actively driving energy efficiency and carbon reduction.	No significant differences

50

Assessment items				Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no		Description
				Potential risks	Potentialopportunity
				Carbon fee, renewable energy, fuel/energy tax and laws and regulations: Changes in laws and regulations may impact the green energy industry’s subsidies amount and other conditions, if subsidies reduce, willingness to invest will drop.	In search for manufacturers with a competitive niche, to avoid impacts to company operations due to cancellation of subsidies.
				Increased raw materials cost: Cost for bulk commodity raw materials has increased due to climate change, resulting in impacts to the companyeventually.	Control related amounts of raw materials to avoid simultaneous concentration of goods.
				Total volume and emissions trading: Climate change has resulted in the general rise of temperature, indirectly impacts the company’s air-conditioning equipment for increased load.	Monitor and review if there are any replacement requirements while conducting maintenance and cleaning work for the whole company, and plan ahead for replacing the old equipment, as a countermeasure to equipment with increased carbon emissions and reduced efficiency.

51

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
(IV) Has the Company compiled the greenhouse gas emissions, water consumption and total weight of waste in the past two years and established management policies for energy saving and reduction of greenhouse gas emission, water consumption and other wastes?	V		reduction of various wastes, to achieve the goal of pollution-free environment. Also promotes environmental policy to suppliers, contractors and carriers, with the expectation of working together towards environmental protection. (IV) For the mask environmental protection business in Taiwan, the waste reduction and energy saving improvement continues under the concept of pollution prevention, and four major environmental protection policies are established: “energy saving and waste reduction, pollution prevention, compliance with laws and regulations, and continuous improvement.” management system and ISO9001 quality management system certification. The establishment of the ISO14064-1 greenhouse gas inventory management system in 2023 has successfully passed the verification. In the future, we will continue to "plan-execute-check-action" to implement the specific hazardous chemicals for electrical and electronic equipment and ban the use of hazardous substances, effectively implement RoHS and REACH_SVHC, and continue to promote environmental protection business in conjunction with the Company's internal audit. 1. Greenhouse gas: In 2023, we built the ISO 14064-1, to inventory the greenhouse gas in 2022. The verified data distinguishes among direct emissions (scope 1, 151.49 metric tons of CO2e/year), indirect energy emissions (scope 2, 15,291.85), and other indirect emissions (scope 3, 3516.74 tons CO2e/year). 2. Energy saving and waste reduction The solar power stations was completed in 2023, and saved about 33,612KW/M and approx. 12,000 during summer for TMC Plant 1, and 9,400KW/M or approx. 34,000 for TMC Plant 2, with carbon reduced by about 255.49 ton-CO2e/year. In addition, NT$9 million was invested to improve the air compressor and 340,238kw is saved per year; from 2022 to 2023, NT$1.6 million was invested to replace nine inverters in air-conditioning boxes, totaling savings: 663,490 kW; NT$220,000 was invested to improve the traditional lights for LED lights , the total savings was 29,229KW, and the total carbon reduction was about 511.31 tons-CO2e/year. In terms of water resources, the water supply for scrubbers used in air pollution prevention equipment was replaced with recycled water. The annual reduction was about 1,800 tons of water. Approximately three tons of air-conditioning condensate are collected every day into recycled water, which saved 1,080 tons per year. A reclaimed water system has been added to the box washing machines required for capacity expansion. The goal is to achieve 100% pure water recovery and save 3,650 tons of water every year. In 2023, NT$15 million has been invested in the centralized recycling treatment of waste sulfuric acid at TMC Plants 1 and 2. Approximately 50 metric tons of waste sulfuric acid were recovered each month,and the monthlyusage of liquid caustic soda were reduced by60 metric tons.

52

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
			3. Pollution prevention To avoid polluting the environment, effectively adopt preventive measures to prevent raw materials or manufacturing processes from generating wastes and harmful substances, leaks of untreated wastes into the surrounding environment, resulting in environmental pollution. Set-up leakage detection equipment for early detection to avoid resulting in pollution to spread, affecting personnel, equipment, and safety of the environment. Preventive equipment’s maintenance and improvement, wastewater, air emissions and wastes generated from manufacturing operations can be treated appropriately, important parameters of various equipment are connected to the central monitoring system for instant monitoring. (1) Water pollution preventive system and recycling and reuse Wastewater system conditions are connected to the monitoring system for wastes, enabling instant monitoring of system operations situations. Adopts onsite second time prevention setup with overflow tank and detection equipment setup, to avoid incidents such as wastewater leakage or returning water from the release pond with abnormal water quality during system malfunction or tank damage resulting in environmental pollution. To avoid release of wastewater that does not qualify for the standards, carry out regular maintenance, raise treatment efficiency to achieve lowering added drug dosage and raise the capability for appropriate handling, early detection of abnormality and treatment to maintain normal operations of systems. The monthly sampling of the Hsinchu Science Park Bureau, and the results from regular testing every half year shows that they are lower than discharge standards. (2) Air pollution prevention Ensure that the exhaust air generated by the process in the factory meets the requirements of environmental protection laws and regulations after treatment. Pollutants are inspected as required by the permit, to ensure compliance with emission standards and reduce air pollutant emissions. In 2023, NT$360,000 has been invested in Plant 3 to increase the frequency of carbon replacement for organic pollutant control system, and the activated carbon is replaced on a monthly basis. In order to maintain the removal efficiency of the control equipment, NT$10 million was invested in Q4 2023 to purchase a zeolite runner to replace the activated carbon system for removing organic pollutants. It is expected to be completed in Q1 2024, and the removal rate of organic pollutants will exceed 95%. The Mask No. 1 Factory invested NT$450,000 to improve the old pipelines and dampers of the scrubbers to increase the stability of the air pollution control system. (3) Waste management Examine the manufacturing process to continuously reduce waste generation, and actively seek opportunities for resource recycling. Waste isproperlydisposed of,and the waste flows in the

53

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
			product life cycle is checked, to assist the Company in discovering recyclable resources. Waste sulfuric acid (concentration >= 40%) recycling was added in 2023 in Plant 1 and 2. The waste liquid discharged by the wet machines from production activities contains about 40% - 80% of sulfuric acid waste liquid (H2SO4). It is collected in a dedicated pipe and tank for recycling, avoiding the mixing of factory wastewater into the wastewater system and increasing the burden on the system. It also reduces the consumption of NaOH. The empty one-gallon barrels for chemicals are sent to the legal treatment plant with dedicated vehicles, and after cleaning and crushing, the barrels are turned into raw plastic pellets. The waste wooden boards from machine move-in and installation operations become the fuel of running boilers by working with vendors with boilers, such as Taiwan Cement. The anti-collision material, BlanK Styrofoam are reused to make plastic pellets. All recycled resources are concretely classified and fully recycled. Therefore, in the Company, 2,855 metric tons of the waste generated from the plants are implemented for the 85% recycling path. Not only it reduces environmental impacts and operating costs, but also implements waste management operations in accordance with relevant laws and regulations. Waste disposal is commissioned to qualified external waste disposal and treatment vendors, and track the transportation truck and waste treatment flows to ensure that they comply with laws and regulations. 4. Complying with laws and regulations Truly understand the government’s request relating to environmental laws and regulations, prepare analysis of the registration form of the regulations and the company’s legality, actively participate in various regulatory briefings held by government units. Regular inspection and testing in accordance to laws and regulations to ensure meeting environmental legal standards, and promote the government’s environmental policies to employees, increasing their environmental protection and legal requirements knowledge, ensuring effective implementation of the company’s environmental protection policies. 5. Continuous improvements Pursuant to ISO14001 system, the annual environmental protection targets and programs for the key implementation items are formulated. Review and audit implementation outcomes each year to ensure effective implementation of continuous improvements of the policies raising environmental quality. The Company’s greenhouse gas emissions, water consumption volume and total weight of wastes generated over the past two years.

54

Assessment items				Operationalstatus	Operationalstatus	Operationalstatus		The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no			Description
							Note Scope 1/2
				Items	2022	2023	Note
				(tonnes)	176,440	196,427
				Water usage intensity (tonnes)/turnover(NT$10,000)	0.46	0.50
				Total waste weight (tonnes)	113.58	285.08
				Total weight of waste (tonnes)/turnover(NT$10,000)	0.0003	0.0007
				Greenhouse gas emissions (metric tons CO2e)	15,443.33	16,406.53	Scope 1/2
				Greenhouse gas emissions (metric tons CO2e)/turnover(NT$10,000)	0.040	0.042
IV. Social Issues (I) Does the Company establish policies and procedures in compliance with regulations and internationally recognized human rights principles? (II) Has the Company established and implemented reasonable employee welfare measures (including remuneration, vacation and other benefits) and appropriately reflected the business performance or results in the employee remuneration policy?	V V		(I) (II)	To fulfill sustainable development, protect all of the employees’, customers’ and stakeholders’ basic human rights, abides by the principles as laid out in the various international human rights conventions such as the “United Nations Universal Declaration of Human Rights,” “United Nations Guiding Principles,” “United Nations Guiding Principles on Business and Human Rights,” “The United Nations Global Compact,” and “International Labor Organization,” formulates and discloses human rights policy, disclosing related information on the company’s website simultaneously. The Company has formulated and implemented reasonable employee benefit measures, values employees’ rights and fulfill its sustainable development responsibilities. Therefore, the remuneration policy of the Company is based on the correlations of the individual’s capability, his/her contribution to the company, performance, and operations performance, appropriately reflect business performance or outcome in employees’ remunerations to facilitate recruitment, retention and inspiration of human resources, and thereby accomplish the Company’s goals toward sustainability. The Company’s actual average employee salary for 2023 was adjusted to 0-10%. Status of the Company’s employee benefit measures, continuing education and trainings: [Salary and motivation system] Salary and multiple rewards system (Dragon Boat Festival, Mid-Autumn Festival and year-end bonus), additional performance bonus, quarterly bonus and allocation of earnings, production bonus, station allowance; flexible salary adjustment for individuals; employee bonus, employee stock option.				No significant differences

55

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
(III) Does the Company provide employees with a safe and healthy working environment and regularly conduct safety and health training?	V		[Life care and protection] Enjoy complete group insurance (free life insurance/accident insurance/hospitalization medical treatment/accident medical treatment/occupational hazard); cash gifts and subsidies for child birth, weddings, death in the family; birthdays/occasions gift vouchers; free annual employee health check-ups; appointed store; welfare committee to regularly organize travels and various sporting events and domestic and overseas travel subsidies; employee health care, regular visits by doctors and nurses providing on-site care, professional consultation sessions and suggestions for employees; Christmas party. [Convenient facilities] Provides complete indoor employee parking spaces; gym, indoor badminton court, tennis court, table tennis and so on leisure facilities; established lactation room, complete facility for use by female employees; established employee canteen to offer meals, provides free coffee, tea beverages, and 180-inch large screen viewing; provides accommodation for job candidates from other cities. [Trainings] Provides new employee educational training; conducts work training based on the employee’s work requirements; provides external training to employees for self-learning and growth. (III) In addition to establishing the Employee Welfare Committee, setting up gym and medical room, and hiring professional fitness coaches and nursing staff. The Company built and passed the ISO 45001 system this year. It also organizes various employee activities and employee health examinations from time to time to protect the employees' physical and mental health. The Company’s healthy work environment and employee safety protection measures are as below: 1. Environment safety: (1) Regularly check on, test and maintain the fire safety equipment and various public facilities and equipment every year, cooperate with the government regulation prohibiting smoking within the factory. (2) Engage professional office cleaning and disinfection companies regularly once a year, to ensure a safe and comfortable work environment. (3) Monitoring the operating environment as required by laws, and adding items to ensure a safe working environment. 2. Fire safety aspects: Established a complete fire safety system according to the Fire Services Act, and ensured immediate repair of faults. 3. Employee health care: Health examinations are held at the end of each year for employees. The in-house nurses collect statistics on the results of health examinations and manage such by ranking and trackingof employees' healthperiodically. The weight loss activities were also held thisyear to

56

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
(IV) Has the Company established effective career development training plans? (V) Has the Company complied with the relevant regulations and international standards and formulated policies for consumer protection and grievance procedures with respect to consumer health and safety, customer privacy, marketing and labeling of products and services? (VI) Has the Company established supplier management policies which require suppliers to comply with regulations on environmental protection, occupational safety and health or labor rights and reported the implementation?	V V V		promote the concept of weight loss. 4. Regularly review and promote labor safety and health matters, including transportation, health education, and safety, every month. (IV) The Company has set-up comprehensive educational training, to assist employees with diverse career development. (V) The Company has set-up a professional and dedicated customer service team (business/quality assurance/the Group’s environment, safety, and engineering division) responsible for handling demands and complaints from customers. Abides by the environmental protection requirements of the EU RoHS Directive with suppliers. The Company follows related laws and regulations and international standards in the marketing and labelling of its products and services, and marked with obvious labelling. (VI) The Company aims to establish a stable semiconductor supply chain, and attaches great importance to the partnership with supplier partners. Risk assessment, tracking, improvement, and management are conducted for raw material suppliers every year. Raw material shipments must comply with laws and regulations. Through rigorous supplier self-evaluation, we urge suppliers to comply with environmental protection and health regulations at all times. The Company also pays attention to the three major ESG aspects of suppliers, namely economics, society, and environment, and includes all relevant standards in the evaluation. Only those suppliers meeting the requirements can be included in the procurement counterparties after actual verification. If the supplier fail to meet the requirements, the transactions must be terminated and alternative suppliers will be sought. TMC regularly reviews the four major risk items, namely product quality, price, delivery, and service via “supplier audit and inspection" and "supplier delivery quality assessment.” Meanwhile, the environmental criteria and social standards are also evaluated, and the score ranking of the evaluation serves as the basis of supplier management.
V. Has the Company referred to international reporting standards or guidelines in its preparation of sustainable development reports and other reports which disclose the Company's non-financial information? Does the preceding report obtain verification or opinions from a third-party authentication unit?	V		The Company has prepared the 2022 Corporate Sustainability Report pursuant to the GRI Sustainability Reporting Standards 2021 released by the Global Reporting Initiatives (GRI) and the “Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Sustainability Reports by TWSE Listed Companies” released by TWSE, while referring to the sustainability indicators of the Sustainability Accounting Standards Board (SASB); the report was assured by PwC Taiwan. Relevant and reliable information on corporate sustainable development has been disclosed on the Company's website and the FSC’s Market Observation Post System, and communication with stakeholders has been enhanced. The 2023 Corporate SustainabilityReport is currentlybeing prepared,and it is expected to be	No significant differences

57

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	The differences with the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and reasons
	Yes	no	Description
			completed and disclosed on the Company's website and the Market Observation Post System in Q3 2024.
VI. If the Company has established its corporate sustainable development best practice principles in accordance with the “Corporate Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies”, please describe the operations and differences: The Company has established its “Corporate Sustainable Development Best Practice Principles” and there are no significant differences from the actual operations and the Principlesfor Listed Companies.
VII. Other important information that can help others to understand the operations of the corporate sustainable development: This is a dedicated page on the Company’s website to disclose corporate sustainable development operations and stakeholders, sustainability-related operations are regularly updated helpingothers to understand the status of the sustainabilityoperations.

• Note 1: For a company who has already prepared its sustainable development report, a note is required for the operational status stating the method to search the sustainable development report and the index entries substitution.

• Principles of materiality refers to major impacts to the Company’s investors and other stakeholders as a result of environmental, social and corporate governance issues.

58

Climate-related information of publicly traded and OTC companies

(IX) Implementation of reporting of climate-related information

mate-related information of publicly traded and OTC companies X)Implementation of reportingof climate-related information
Items	Implementation
1. Describe board and management supervision and governance of climate-related risks and opportunities. 2. Describe how the identified climate risks and opportunities will affect the Company’s business, strategy and finances (short, intermediate and long term). 3. Describe the financial impact caused by extreme climate events and transition actions. 4. Describe how the identification, assessment, and management processes of climate risks are integrated into the overall risk management system. 5. If scenario analysis is used to assess resilience to climate change risks, the scenarios, parameters, assumptions and analysis factors used and significant financial impacts should be explained. 6. If there is a transition plan to manage climate-related risks, explain the content of theplan,and the indicators andgoals used to identify	1. TMC has established a corporate sustainability management committee to implement the ESG process, which covers the supervision and governance of climate-related risks and opportunities, and regularly reports to the board. 2. Climate risk is within the scope of corporate governance, and we regard it as an opportunity to align with our upstream customers and downstream suppliers, and believe that business revenue will increase in the future. Short- term: The ISO 14064-1 greenhouse gas inventory and verification has been carried out this year. Interim: Conducting the Science Based Targets Initiative (SBTi) to set short-term and long-term carbon reduction targets. Long-term: moving toward the 2050 net zero target. 3. The extreme climate causes disruption to the supply of raw materials, water, and power for production. We have arranged for more than two suppliers to carry out water-saving and water truck transportation plans, while adding generators and UPS to avoid impacts on shipments and revenues, which in turn affect financial performance. 4. Carry out climate risks identification in Q1; formulate climate risks countermeasures or implementation plans in Q2; implement and correct climate risks countermeasures or implementation plans in Q3; and report the implementation results to the board in Q4 every year, and have the Corporate Sustainability Management Committee conduct quarterly review the progress of abovementioned works. 5. Reservoirs are set up in response to extreme climate that may limit or cut off water supply. If the water restrictions in the science park exceeds 20%, and the water is cut off for more than 1 day, water trucks will be dispatched, and the production will not be affected. If there is a time difference in scheduling of water trucks, work hours may be lost. 6. Under the risk of power shortage in Plant 3, the addition of 1,500KW generators was completed in 2023,and theproduction machines in Plant 1

59

and manage physical risks and transition risks. 7. If internal carbon pricing is used as a planning tool, the basis for setting the price should be explained. 8. If there are climate-related goals set, the activities, scope of greenhouse gas emissions, planning schedule, annual progress and other information covered should be explained. If carbon credits or renewable energy certificates (RECs) are used to achieve relevant goals, the source and quantity of carbon reduction credits to be exchanged or the quantity of renewable energy certificates (RECs) should be explained. 9. Status of greenhouse gas inventory and assurance (to be filled in 1-1 separately)

and 2 are equipped with UPS (Uninterrupted Power Supply System) to satisfy the usage deployment. 7. Planning for implementation by 2026. 8. Greenhouse gas inventory activity: the carbon inventory and verification activities of ISO14064-1 2018 version for 2022 was completed in 2023, and the activity continues every year.

1-1. Status of greenhouse gas inventory and assurance

tatus ofgreenhousegas inventoryand assurance
Company information □Companies with a capital of more than NT$10 billion, or in the steel or cement industry. □Companies with a capital of more than NT$5 billion but less than NT$10 billion. ▓Companies with a capital of more than NT$5 billion but less than NT$10 billion.	Sustainable Development Roadmap for publicly traded or OTC firms should at least disclose
	▓Parent company-only inventory	□Inventory of subsidiaries included in the consolidated financial statements
	□Parent-only assurance	□Assurance of subsidiaries included in the consolidated financial statements

60

Scope 1	Total emissions (metric tons CO2e)	Intensity (metric tons CO2e/NT$ million)(Note 2)	Assurance organization
Parent company	151.49	0.038	TUV TÜV NORD Taiwan
Subsidiary
...(Note 1)
Total
Scope 2	Total emissions (metric tons CO2e)	Intensity (metric tons CO2e/NT$ million) (Note 2)	Assurance organization
Parent company	15,291.85	3.933	TUV TÜV NORD Taiwan
Subsidiary
...(Note 1)
Total
Scope 3	3516.74

Instructions for filling the form:

1. The Scope 1 and Scope 2 information in this table shall be compiled in accordance with the schedule stipulated in Paragraph 2, Article 10 of the standard, and companies may voluntarily disclose the information of Scope 3.

2. Companies may conduct GHG inventory according to the following standards:

3. (1) Greenhouse Gas Protocol (GHG Protocol).

4. (2) ISO 14064-1 published by the International Organization for Standardization (ISO).

5. The assurance organization shall comply with the relevant requirements for sustainability report assurance stipulated by the Taiwan Stock Exchange and Taipei Exchange.

6. Subsidiaries can file reports separately, collectively (by country or region), or in a consolidated format (Note 1).

7. The intensity of GHG emissions can be calculated per unit of product/service or revenue, but at least the data calculated in terms of revenue (NT$ million) should be disclosed (Note 2).

8. The proportion of operating locations or subsidiaries not included in the inventory calculation shall not exceed 5% of the total emissions. The total emissions disclosed above refer to the emissions calculated in accordance with Description 1 on the scope of mandatory inventory.

9. The description of assurance should summarize the content of the assurance report of issued by the assurance organization and attach the complete assurance statement to the annual report (Note 3).

61

(X) Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies
	Yes	No	Description
I. Stipulate ethical management policies and plans (I) Does the company establish ethical management policies approved by the board and have bylaws and publicly available documents addressing its corporate conduct and ethics policy and measures and the commitment regarding the implementation of such policy from the board and the executive management team? (II) Has the Company established a risk assessment mechanism against unethical conduct, analyzed and assessed on a regular basis business activities within their business scope which are at a higher risk of being involved in unethical conduct, and established prevention programs accordingly which at least cover the prevention measures against the conducts listed in Paragraph 2 of Article 7 of the Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies?	V V		(I) The Company’s “Ethical Corporate Management Best Practice Principles” was established on August 6, 2015, and some amendments were approved by the Board of Directors on November 4, 2020. There is no difference between the actual operation and the approved “Ethical Corporate Management Best Practice Principles”. The Company is in compliance with the laws and regulations. The Board of Directors was eager to and had duly approved the Corporate Social Responsibility Code of Conduct policy, and in the document, details of the policy and active commitments by the Board of Directors and management level to implement it can be found. (II) The Company has established a risk management organization to identify, evaluate and manage potential risks of the Company, and has evaluated that the acts described in Paragraph 2 of Article 7 of the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies are included in the scope of risk identification, evaluation and management, and has taken appropriate preventive measures. In addition, the Company has set-up a regular and random audit of the implementation situation by the audit personnel and CPA for active response of any potential conflicts of interests within the company.	No significant differences

62

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies
	Yes	No	Description
(III) Has the Company defined operating procedures, conduct guidelines, disciplinary penalties and grievance process in the program preventing unethical conduct and put them in practice and regularly reviewed and amended the program?	V		(III) For promoting and educating on ethical conducts, the Company’s Corporate Social Responsibility Code of Conduct is published on the company website for reference by its personnel anytime as a basis for individual behavior. A unit to handle unethical behavior reporting is also established. If there are discovery of any major events of violations or major damages to the company, the unit will prepare a report immediately and report to the independent directors so as to fulfill the implementation of unethical behavior handling. The company emphasizes its determination to combat dishonest practices through internal control system, work rules, new employee orientation education training, regular campaigns, and monitoring via accounting system, requesting its employees to adhere to the principle of conflict of interests avoidance,andpromotes the company’spolicyto its suppliers.
II. Fulfillment of ethical management (I) Does the Company evaluate the ethical record of the counterparties and clearly stipulate the ethical behavior clause in the contract signed with the counterparties? (II) Has the Company established a full- (or part-) time specialized unit under the board responsible for the promotion of corporate ethics management, which regularly (at least once a year) reports policies on ethical operations, programs on prevention of unethical conduct and the status of supervision to the board?	V V		(I) Before the Company enters into any business activity, will first conduct assessment of the counterparty for its legality, ethics and prudence, so as to ensure both parties engage in a fair and transparent trading conduct, create a fair environment for competition, maintaining the company’s competitiveness. (II) Honesty and faithfulness have always been an important management philosophy of the Company, ethics has been promoted from various aspects in full efforts from the Board of Directors to each of the department management, to which all of the employees should adhere to the Ethical Corporate Management Best Practice Principles. The Company has also established an Audit Committee and internal control system to monitor the company in abiding by the laws and regulations. The Company assigned the Human Resources Department as the accountable unit, ensuring the fulfillment of Ethical Operations Management Best Practice Principles based on each unit’s work duties and scope, and the accountable unit will report to the Board of Directors on a regular basis on the implementation status. Implementation status of the Company’s 2023 Ethical Corporate Management has been reported to the Board on March 6, 2024.	No significant differences

63

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies
	Yes	No	Description
(III) Does the company stipulate a policy to prevent conflicts of interest and provide a proper channel for communication, and practically implement the policy? (IV) Does the company establish an effective accounting system and internal control system for practical implementation of ethical corporate management, and is the system regularly audited by the internal auditing unit, and does the unit propose relevant audit plans based on the assessment results of the risk of misconduct for auditing the implementation status of the prevention plan for misconduct, or entrusted to an accountant for auditing? (V) Does the Company regularly conduct internal and external education and training for ethical management?	V V V		(III) The Company has established Ethical Operations Management Best Practice Principles to prevent conflicts of interest and provide a proper channel for communication. The Company conducts its business activities in a fair and transparent way based on the principles of ethical operations management. In addition, the company has already formulated the whistleblowing system procedures to report on illegal (including corruption) and unethical behaviors. (IV) The Company’s accounting system and internal control system are formulated based on related laws and regulations. The internal audit unit prepares the draft work report and audit report based on the audit results, submit them to the Board of Directors, and hold regular and random audits with the CPA. (V) The Ethical Corporate Management Best Practice Principles have been announced on the Company's website and communicated with employees at monthly management meetings. In 2023, it was promoted through the corporate website and on various occasions to educate employees about adhering to work philosophy and attitude of integrity, fairness, transparency, and self-discipline. In addition,the Companytrained 283 employees in 2023.
III. Operational status of the whistleblowing system of the Company (I) Does the company have a specific whistleblowingand reward system,a	V		(I) For whistleblowing/complaints matters of any possible violations of laws and regulations or the code of conduct,the Companymayreport to the Company’s audit office. The Company	No significant differences

64

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies
	Yes	No	Description
convenient whistleblowing channel and assign appropriate and dedicated personnel to deal with the respondent? (II) Does the company stipulate the standard operating procedures, the follow-up measures should be taken after the investigation and relevant confidentiality mechanism for the reported matters? (III) Does the company take preventive measures to protect the whistleblower from improper treatment due to the report?	V V		establishes standard operating procedures for investigating the complaints received and protects the informant’s identity by establishing confidentiality mechanisms. (II) The Company formulates complaint procedures, set-up responsible units to handle the cases and set-up the handling procedures, abides by privacy data laws and strictly prohibits retaliation conducted against the informant. The Company’s “Ethical Operations Management Best Practice Principles” has stipulated standard operating procedures for investigating the complaints received and ensuring such complaints are handled in a confidential manner. (III) The Company’s “Ethical Operations Management Best Practice Principles” has stipulated items in the investigation of the complaints received, protection of informant's identity and details of reported misconduct, proper measures to shield a complainant from retaliation for filingcomplaints.
IV. Reinforcement of information disclosure (I) Does the company reveal the content of Ethical Corporate Management Best Practice Principles and the implementation results on its website and on the website of the Market Observation Post System?	V		The Company has disclosed its ethical operations management information on its website which has a designated page for corporate governance in addition to disclosing in its annual report.	No significant differences
V. If the Company has stipulated its Ethical Corporate Management Best Practice Principles based on the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”, please state the difference between its operations and the stipulated principles: The Company’s “Ethical Corporate Management Best Practice Principles” had been approved by the Board of Directors on August 6, 2015. There are no differences between actual operations and the Principles. (I) Regular advocacy on ethical operations management concept and advocated to all of the employees on a regular basis during educational trainings: Ethical Operations Management Best Practice Principles have been announced on the Company’s website, and are promoted to the employees during monthly management meetings. (II)Ethical conduct is listed as one of the terms and conditions in contracts with counterparties.

65

Assessment items	Operationalstatus	Operationalstatus	Operationalstatus	Status of the Company’s practice of ethical management and differences from the Ethical Corporate Management Best Practice Principles for the Listed Companies and reasons for discrepancies
	Yes	No	Description
(III) Internal independent grievance reporting mailbox and dedicated line has been established and announced on the Company’s website and on the internal website: No whistleblowingcases on ethics have been received in 2023.
VI. Other important information that helps to understand the implementation status of the company’s ethics management (such as situation of the company conducting review and revision of its Ethical Corporate Management Best Practice Principles): In order to fulfill corporate governance, the responsible unit for ethical management has been established. Revisions to partial articles of the “Ethical Corporation Management Best Practice Principles” have been approved by the Board of Directors on November 4, 2020.

66

(XI) The Company formulates governance principles and related regulations

The Company’s website has a dedicated page to corporate governance for investors to search and download related corporate governance regulations, please refer to the Company’s website. https://www.tmcnet.com.tw/tw/Investors/Announcements

1. Articles of Incorporation

2. Procedures for Lending Funds to Others

3. Asset Acquisition and Disposal Procedures

4. Policies and Procedures for Preventing Insider Trading

5. Procedures for Handling Material Inside Information

6. Audit Committee Foundation Principles

7. Remuneration Committee Foundation Principles

8. Ethical Operations Management Best Practice Principles

9. Corporate Sustainable Development Best Practice Principles

10. Ethical Behavior Code of Conduct

11. Rules of Procedure for Board of Directors’ Meetings

12. Rules of Procedure for Shareholders’ Meetings

13. Procedures for Election of Directors

14. Regulations for Endorsement and Guarantee

Regarding the corporate governance-related situation of the Company, please refer to this annual report for the section on “The governance status of the Company, and the differences with the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and reasons.”

• (XII) Policies and Procedures for Preventing Insider Trading and Procedures for Handling Material Inside Information

To establish a sound material inside information handling and disclosure mechanism, for avoiding improper divulgence of information and to ensure consistency and accuracy of information announced by the Company to outside, and to strengthen the prevention of insider trading, the regulation is specially formulated and hereby provided to all directors, managers and company employees to abide by and for timely education and advocacy purpose. Refer to the Company’s website for related information. https://www.tmcnet.com.tw/tw/Investors/Govermance

67

(XIII) Implementation status of internal control system

1. Statement on Internal Control

Taiwan Mask Corporation Statement on Internal Control

Date: March 6, 2024

Based on the findings of a self-assessment, the Company states the following with regard to its internal control system during the year of 2023:

• I. The Company’s board and management are responsible for establishing, implementing and maintaining a proper internal control system. Our internal control is a process designed to provide reasonable assurance over the effectiveness and efficiency of our operations (including profitability, performance and safeguarding of assets), reliability of our financial reporting and compliance with applicable laws and regulations.

• II. An internal control system has inherent limitations. No matter how perfectly designed, an effective internal control system can provide only reasonable assurance of accomplishing its stated objectives. Moreover, the effectiveness of an internal control system may be subject to changes due to extenuating circumstances beyond our control. Nevertheless, our internal control system contains self-monitoring mechanisms, and we take immediate remedial actions in response to any identified deficiencies.

• III. We evaluate the design and operating effectiveness of the internal control system based on the criteria provided in the Regulations Governing Establishment of Internal Control Systems by Public Companies (herein blow, the “Regulations”). The criteria adopted by the Regulations identify five key components of managerial internal control: 1. Control environment. 2. Risk assessment. 3. Control activities. 4. Information and communication. 5. Monitoring. Each component has its own items. Please see the Regulations for details.

• IV. We have evaluated the design and operating effectiveness of our internal control system according to the aforementioned Regulations.

• V. Based on the assessments described above, the Company considers the design and execution of its internal control system to be effective as at December 31, 2023. This system (including the supervision and management of subsidiaries) has provided assurance with regards to the Company's operational results, target accomplishments, reliability, timeliness and transparency of reported financial information, and its compliance with relevant laws.

• VI. This Statement will be an integral part of the Company’s annual report and prospectus and will be made public. Any falsehood, concealment or other illegalities in the content made public will entail legal liability under Article 20, 32, 171 and 174 of the Securities and Exchange Act.

• VII. This Statement has been passed by the Board in the meeting held on March 6, 2024, all of the attending directors affirm to the content of this Statement.

Taiwan Mask Corporation

==> picture [34 x 34] intentionally omitted <==

Chairman: Sean Chen

General Manager: Lidon Chen

==> picture [35 x 34] intentionally omitted <==

68

1. Where a CPA has to be hired to carry out a special audit of the internal control system, furnish the CPA audit report: None.

2. (XIV) For the year 2023 or during the current fiscal year up to the date of publication of the annual report, disclose any sanctions imposed in accordance with the law upon the Company or its internal personnel, any sanctions imposed by the Company upon its internal personnel for violations of internal control system, and the penalties which may have a significant impact on shareholders' equity or the price of securities, and list the content of penalties, principal deficiencies, and the state any efforts to make improvements: None.

3. (XV) Material resolutions of a shareholders meeting or a Board of Directors meeting during the year of 2023 and during the current fiscal year up to the date of publication of the annual report

4. Material resolutions of a shareholders meeting

   • Key resolutions from the 2023 annual general meeting and their implementation:

   • (1) Ratification of 2022 business report and financial statements.

     • Implementation outcome: Resolution approved. Ratification of 2022 Business Report and Financial Statements, of which the consolidated revenue for the whole year is NT$7,741,118 thousand, net profit after tax is approximately NT$703,519 thousand, basic earnings per share is NT$3.37.

   • (2) Ratification of 2023 earnings distribution proposal

     • Implementation outcome: Resolution approved. The resolution approved the distribution of NT$2.3 per share. The chairman approved on June 22, 2023, to set July 28, 2023 as the book closure date, and the cash dividends were paid on August 18, 2023.

   • (3) Approved distribution of cash dividends from capital surplus. Implementation outcome: Resolution approved. The resolution approved the cash distribution of NT$0.2 per share. The chairman approved on June 22, 2023, to set July 28, 2023 as the book closure date, and the cash dividends were paid on August 18, 2023.

   • (4) Proposed to Issue common shares by private placement.

     • Implementation outcome: Resolution approved. Considering that the issuance period will soon reach the deadline, it is planned not to continue the issue of common shares by private placement approved by the 2023 regular shareholders’ meeting after the board resolution on March 6, 2024.

   • (5) Amendment to provisions of the Company’s “Articles of Incorporation”. Implementation outcome: Resolution approved. The registration was approved by authority with approval document number Zhu-Guan-Ji-GuanZhu-Shang-Zi No. 1120017721 issued on June 5, 2023.

   • (6) Full re-election of directors.

Implementation status: Re-election completed. The registration was approved by authority with approval document number Zhu-Guan-Ji-GuanZhu-Shang-Zi No. 1120017721 issued on June 5, 2023.

• (7) Lifted the restrictions on the non-compete clause of new directors and their representatives. Implementation outcome: Resolution approved. and implemented in accordance with the resolution of the shareholders' meeting.

69

2. Important resolutions of the board of directors

Key resolutions by the Company’s Board of Directors since January 1, 2024 until the publication date of the annual report are as follows:

Date	Term	Keyresolutions
March 6, 2024	The 24th meeting of the 12th term	(1) Approved the distribution of employees and directors’ remuneration for 2023. (2) Approved the 2023 Business Report and Financial Statements (3) Approved the 2023 earnings distribution. (4) Approved not to continue the issue of common shares by private placement approved by the 2023 regular shareholders’ meeting. (5) Approved the private placement of securities. (6) Approved the Company’s 2023 Internal Control System Validity Evaluation and Declaration of Internal Control System. (7) Approved to convene the Company’s 2024 regular shareholders’ meeting. (8) Approved the procurement of equipment. (9) Approved to participate in the private placement of Truelight Corporation. (10) Approved the endorsements/guarantees for subsidiary Miracle Technology CO., LTD. (11) Approved the appointment of the Company’s accounting, finance and corporate governance officers and adjustment of the managerial officers’ remuneration. (12) Approved the appointment of the directors and managerial officers for the subsidiaries and the adjustment of remunerations for managerial officers of the subsidiaries. (13) Approved the appointment and remuneration of CPAs. (14) Approved the proposal for the Company to establish and expand its credit facilities withbanks.

• (XVI) Where, during 2023 or during the current fiscal year up to the date of publication of the annual report, a director or independent director has expressed a dissenting opinion with respect to a key resolution passed by the board, and the dissenting opinion has been recorded or prepared as a written declaration: None.

• (XVII) A summary of resignations and dismissals, during 2023 or during the current fiscal year up to the date of publication of the annual report, of the Company’s chairman, general manager, principal accounting officer, principal financial officer, chief internal auditor, principal corporate governance officer and principal research and development officer

• The Company’s Chief Financial Officer, Eve Yang, concurrently serves as the Company’s accounting, finance and corporate governance officer. To cope with the dedicate division of labor and corporate governance of the Group’s organization, on March 6, 2024, the Board of Directors approved the adjustment of the positions as follows:

Job title	After adjustment	Before adjustment
Principal accountingofficer	Shu-Wei Yu	Eve Yang
Financial Officer	Shu-Hua Lin
Head of corporategovernance	Chiao-Jin Tseng

70

V. Information on professional fee of accountant

(I) Professional fee of CPAs

essional fee of CPAs
Name of AccountingFirm	Accountant		Date of the audit
PricewaterhouseCoopers, Taiwan Name of CPA Firm	Ya-Hui Cheng	Chien-Yu Liu	January 1, 2023 to December 31, 2023

Unit: NT$Thousand

Fee	Type of Fee Bracket	Type of Fee Bracket	Professional audit fee	Professional audit fee	Professional audit fee	Non-professional audit fee	Non-professional audit fee	Non-professional audit fee	Total	Total
1	Below NT$2,000 thousand
2	NT$ 2,000 thousand (inclusive) ~ NT$4,000 thousand						2,557		2,557
3	NT$ 4,000 thousand (inclusive) ~ NT$6,000 thousand
4	NT$ 6,000 thousand (inclusive) ~ NT$8,000 thousand
5	NT$ 8,000 thousand (inclusive) ~ NT$10,000 thousand		9,870						9,870
6	NT$10,000thousandandabove
Name of Accounting Firm		Accountant		Audit Period	Professional audit fee		Non- professional audit fee		Total	Remarks
PricewaterhouseCoopers Taiwan		Ya-Hui Cheng Chien-Yu Liu		January 1, 2023 to December 31,2023	9,870		2,557		12,427	Note

Note: The above mentioned accounting fees are the professional audit fee and non-audit fee that is paid to the Company’s Certified Public Accountant (CPA) and the affiliated company of the CPA’s accounting firm.

• (1) The Company: The professional audit fee is NT$6,250 thousand non-professional audit fee is NT$2,032 thousand (ESG consultation, CB to issue of new shares and others).

• (2) Subsidiaries: The professional audit fee is NT$3,620 thousand non-professional audit fee is NT$525 thousand (follow-on offering for capital increase, amendments to the Articles of Incorporation, changes of directors/supervisors, among other things).

• (II) If the accounting firm is changed and the professional audit fee paid in the year of change is lower than in the previous year prior to the change, the amount and reason for the professional audit fee before and after the change: Not applicable.

• (III) If the professional audit fee has decreased by more than 10% compared with the previous year, the decreased amount, proportion and reason for the reduction of professional audit fee: None.

VI. Information on change of accountants: None.

VII. Information on the chairman, general manager, manager in charge of financial or accounting affairs of the Company who has worked in the accounting firm or an affiliated company of the certified accountant for the past one year: None.

71

VIII. Status of any equity transferred and changes in pledge of stock rights in recent years and until the publication date of the annual report by directors, independent directors, managers and shareholders with over 10% shares (I) Changes to share ownership

anges to share ownership	anges to share ownership
		Unit: Shares
Job title	Name	2023		2024 upto March 29,2024
		Increasing (decreasing) number of shares held	Increasing (decreasing) number of pledged shares held	Increasing (decreasing) number of shares held	Increasing (decreasing) number of pledged shares held
Chairman	Sean Chen	0	0	0	0
Director	Chao-Yi Wu	391,000	0	0	0
Director	Youe Chung Capital Corporation Representative: Ming-Chung Chang	(900,000)	(900,000)	(500,000)	0
Director/General Manager	Lidon Chen	1,000,000	1,300,000	0	0
VicePresident	EveYang	653,000	550,000	0	0
VicePresident	Nester Huang	553,000	587,000	0	0
Vice President	Che-Pin Tseng	291,000	255,000	0	0
Vice President	Chaucer Chung (Date of taking office: August 4,2023)	0	300,000	0	0
Chief Executive Officer	K.J. Wu	(2,994,204)	(3,000,000)	0	0
10%	Youe Chung Capital Corporation	(900,000)	(900,000)	(500,000)	0
Independent Director	Huan-Kuei Cheng	0	0	0	0
Independent Director	Wei-Chen Wang	0	0	0	0
Independent Director	Hui-Fen Chan	0	0	(7,000)	0
Finance Officer/Accounting Officer/Corporate Governance Officer	Eve Yang (Date of dismissal: March 6, 2024)	653,000	550,000	0	0
Financial Officer	Shu-Hua Lin (Date of taking office: March 6,2024)	0	0	0	0
Principal accounting officer	Shu-Wei Yu (Date of taking office: March 6,2024)	0	0	0	0
Head of corporate governance	Chiao-Jin Tseng (Date of taking office: March 6,2024)	0	0	0	0
Director	Fushuo Investment Co., Ltd. (Date of dismissal: May 24, 2023)	0	0	0	0
	Martin Chu (Date of dismissal: May 24, 2023)	0	0	0	0
Vice President	Po-Wen Hsiao (Date of dismissal: March 3, 2023)	(5,000)	0	0	0

Note: Youe Chung Capital Corporation is top-10 major shareholder with over 10% of the Company’s total shares.

72

(II) Information on share transfer:

Name	Reason for share transfer	Transaction date	Counterparty to the transaction	Relationship between the counterparty and the Company, its directors, supervisors, managerial officers and shareholders holding more than 10% of the shares	Number of shares	Transaction price
Youe Chung Capital Corporation	Gift	April 21, 2023	Taiwan Mask Charity Foundation	Related party	400,000	41.35
K.J. Wu	Gift	April 24, 2023	Hui-Chen Lai Wu	Spouse	3,000,000	85.20
Youe Chung Capital Corporation	Gift	September 15, 2023	Taiwan Mask Charity Foundation	Related party	500,000	41.35
Youe Chung Capital Corporation	Gift	March 5, 2024	Taiwan Mask Charity Foundation	Related party	500,000	41.35

(III) Equity pledge information: No equity pledge with a related party.

73

IX. Top ten shareholders by shareholding proportion and information of relationships among them

							Unit: shares;%	Unit: shares;%	Unit: shares;%
Name	Shares owned by the person		Shares held by spouse, underage dependents		Shares Held in the Name of Others		Title, name and relationship of the top ten shareholders who have mutual relationship as spouse or blood relative within the second degree		Note
	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Name	Relationship
Youe Chung Capital Corporation			-	-	-	-	-	-	-
	35,831,440	13.78%
Chao-Yi Wu			668,000	0.26%	-	-	Hui-Chen Lai Wu	Mother and daughter	-
	10,298,000	4.02%
Taiwan Mask Corporation
	7,426,000	2.91%
Hui-Chen Lai Wu							Chao-Yi Wu	Mother and daughter
	5,075,523	1.98%
Powerchip Investment HoldingCorporation
	4,121,000	1.61%
Lidon Chen
	3,750,000	1.46%
Mei-Hui Li					-	-			-
	2,290,000	0.89%
Vanguard Starlight Advanced Aggregate International Equity Index under the custody of Chase
	2,112,000	0.82%
Sean Chen					-	-			-
	2,000,000	0.78%
Dedicated account with CTBC Bank Trust Investment entrusted by Taiwan Life Insurance
	2,859,000	0.78%

X. Company, company’s directors, managers and businesses in direct or indirect control by the company, their number of shares of the reinvested businesses, and the consolidated calculation of the comprehensive shareholding ratio

March 31, 2024 Unit: shares; %

Investee	Invested by the Company	Invested by the Company	Investments by directors, supervisors, managers and businesses in direct or indirect control	Investments by directors, supervisors, managers and businesses in direct or indirect control	Total Ownership	Total Ownership
	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage	Number of shares	Shareholding percentage
SunnyLake Park International Holdings,Inc.	3,120,000	100%	-	-	3,120,000	100%
Youe Chung Capital Corporation	534,877,568	100%	-	-	534,877,568	100%
Miracle Technology Co.,Ltd.	22,955,033	100%	-	-	22,955,033	100%
Weida Hi-TechCompany	12,176,880	28.20%	-	-	12,176,880	28.20%
Advagene BiopharmaCo.,Ltd.	12,549,652	23.51%	3,216,223	6.03%	15,765,875	29.54%
Aptos TechnologyInc.	-	-	28,481,161	47.19%	28,481,161	47.19%
Xsense Technology	-	-	12,189,191	53.00%	12,189,191	53.00%
InnovaVision	37,813,135	75.32%	94,370	0.19%	37,907,505	75.51%
DIGITAL-CAN TECH. CO., LTD.	-	-	7,281,250	57.39%	7,281,250	57.39%
Pilot BatteryCo.,Ltd.	3,600,000	20.00%	7,000,000	38.89%	10,600,000	58.88%
Moment Semiconductor,Inc.	-	-	4,000,000	53.33%	4,000,000	53.33%
One Test System	940,000	100%	-	-	940,000	100%

Note: Investment by the company by using the equity method.

• 74 -

Four. Financing Activities

I. Capital and shares

(I) Source of capital

Unit: Shares: NTD

Year / Month	Issue Price	Authorized Share Capital	Authorized Share Capital	Paid-in Capital	Paid-in Capital	Note
		Number of shares	Amount	Number of shares	Amount	Source of capital	Capital Increase by Assets Other than Cash	Others
October 1988	$10.00	35,000,000	$350,000,000	8,750,000	$87,500,000	Please refer to attached Note (1)
June 1990	$10.00	35,000,000	$350,000,000	35,000,000	$350,000,000	Please refer to attached Note(2)
May 1991	$10.00	50,000,000	$500,000,000	40,250,000	$402,500,000	Please refer to attached Note(3)
July 1992	$10.00	50,000,000	$500,000,000	44,275,000	$442,750,000	Please refer to attached Note (4)
June 1995	$10.00	70,000,000	$700,000,000	55,883,750	$558,837,500	Please refer to attached Note(5)
April 1996	$10.00	70,000,000	$700,000,000	64,427,500	$644,275,000	Please refer to attached Note (6)
June 1996	$10.00	100,000,000	$1,000,000,000	88,077,125	$880,771,250	Please refer to attached Note(7)
April 1997	$10.00	100,000,000	$1,000,000,000	100,000,000	$1,000,000,000	Please refer to attached Note(8)
June 1997	$10.00	250,000,000	$2,500,000,000	146,700,000	$1,467,000,000	Please refer to attached Note (9)
July 1998	$10.00	270,000,000	$2,700,000,000	237,420,000	$2,374,200,000	Please refer to attached Note(10)
August 1999	$10.00	389,000,000	$3,891,000,000	267,287,969	$2,672,879,690	Please refer to attached Note (11)
October 1999	$10.00	389,000,000	$3,891,000,000	267,290,313	$2,672,903,130	Please refer to attached Note(12)
August 2000	$10.00	389,000,000	$3,891,000,000	294,037,400	$2,940,374,000	Please refer to attached Note(13)
December 2000	$10.00	389,000,000	$3,891,000,000	331,189,900	$3,311,899,000	Please refer to attached Note (14)
July 2001	$10.00	450,000,000	$4,500,000,000	374,784,587	$3,747,845,870	Please refer to attached Note(15)
August 2002	$10.00	500,000,000	$5,000,000,000	424,917,953	$4,249,179,530	Please refer to attached Note (16)
June 2003	$10.00	500,000,000	$5,000,000,000	398,093,953	$3,980,939,530	Please refer to attached Note(17)
September 2003	$10.00	500,000,000	$5,000,000,000	399,593,953	$3,995,939,530	Please refer to attached Note(18)
November 2003	$10.00	500,000,000	$5,000,000,000	398,181,953	$3,981,819,530	Please refer to attached Note (19)
June 2004	$10.00	500,000,000	$5,000,000,000	379,443,953	$3,794,439,530	Please refer to attached Note(20)
August 2004	$10.00	500,000,000	$5,000,000,000	369,443,953	$3,694,439,530	Please refer to attached Note (21)
October 2004	$10.00	500,000,000	$5,000,000,000	370,943,953	$3,709,439,530	Please refer to attached Note(22)
December 2004	$10.00	500,000,000	$5,000,000,000	361,963,953	$3,619,639,530	Please refer to attached Note(23)
September 2005	$10.00	500,000,000	$5,000,000,000	359,498,953	$3,594,989,530	Please refer to attached Note (24)
February 2006	$10.00	500,000,000	$5,000,000,000	353,902,953	$3,539,029,530	Please refer to attached Note(25)
May 2008	$10.00	500,000,000	$5,000,000,000	351,072,953	$3,510,729,530	Please refer to attached Note (26)
October 2008	$10.00	500,000,000	$5,000,000,000	345,072,953	$3,450,729,530	Please refer to attached Note(27)
January 2009	$10.00	500,000,000	$5,000,000,000	335,072,953	$3,350,729,530	Please refer to attached Note(28)
November 2009	$10.00	500,000,000	$5,000,000,000	338,908,953	$3,389,089,530	Please refer to attached Note(29)
September 2010	$10.00	500,000,000	$5,000,000,000	288,072,611	$2,880,726,110	Please refer to attached Note(30)
September 2011	$10.00	500,000,000	$5,000,000,000	282,072,611	$2,820,726,110	Please refer to attached Note (31)
November 2011	$10.00	500,000,000	$5,000,000,000	277,871,611	$2,778,716,110	Please refer to attached Note(32)
December 2011	$10.00	500,000,000	$5,000,000,000	271,871,611	$2,718,716,110	Please refer to attached Note(33)
August 2012	$10.00	500,000,000	$5,000,000,000	270,090,611	$2,700,906,110	Please refer to attached Note(34)

• 75 -

Year / Month	Issue Price	Authorized Share Capital	Authorized Share Capital	Paid-in Capital	Paid-in Capital	Note
		Number of shares	Amount	Number of shares	Amount	Source of capital	Capital Increase by Assets Other thanCash	Others
November 2012	$10.00	500,000,000	$5,000,000,000	262,713,611	$2,627,136,110	Please refer to attached Note(35)
October 2015	$10.00	500,000,000	$5,000,000,000	252,713,611	$2,527,136,110	Please refer to attached Note (36)
March 2022	$10.00	500,000,000	$5,000,000,000	255,673,535	$2,556,735,350	Please refer to attached Note(37)
March 2023	$10.00	500,000,000	$5,000,000,000	256,446,475	$2,564,464,750	Please refer to attached Note(38)

Notes:

1. On October 21, 1988, capital at time of establishment was NT$87,500,000.

2. On March 16, 1990, the Company was approved for Initial Public Offering (IPO) and cash capital increase of NT$262,500,000 by the Securities and Futures Commission, Ministry of Finance (1990), Approval Document Number: Tai-Tsai-Zheng (I) No. 000474.

3. On May 14, 1991, the Company was approved for re-capitalization of earnings at NT$52,500,000 by the Securities and Futures Commission, Ministry of Finance (1991), Approval Document Number: Tai-Tsai-Zheng (I) No. 000999.

4. On July 20, 1992, the Company was approved for re-capitalization of earnings at NT$40,250,000 by the Securities and Futures Commission, Ministry of Finance (1992), Approval Document Number: Tai-Cai-Zheng (I) No. 001738.

5. On June 30, 1995, the Company was approved for re-capitalization of earnings at NT$116,087,500 by the Securities and Futures Commission, Ministry of Finance (1995), Approval Document Number: Tai-Cai-Zheng (I) No. 378708.

6. On January 5, 1996, the Company was approved for re-capitalization of earnings at NT$85,437,500 by the Securities and Futures Commission, Ministry of Finance (1996), Approval Document Number: Tai-Cai-Zheng (I) No. 64745.

7. On June 10, 1996, the Company was approved for re-capitalization of earnings at NT$236,496,250 by the Securities and Futures Commission, Ministry of Finance (1996), Approval Document Number: Tai-Cai-Zheng (I) No. 368278.

8. On December 21, 1996, the Company was approved for re-capitalization of earnings at NT$119,228,750 by the Securities and Futures Commission, Ministry of Finance (1996), Approval Document Number: Tai-Cai-Zheng (I) No. 71905.

9. On June 5, 1997, the Company was approved for re-capitalization of earnings at NT$367,000,000 and re-capitalization of additional paid-in capital at NT$100,000,000 by the Securities and Futures Commission, Ministry of Finance (1997), Approval Document Number: Tai-Cai-Zheng (I) No. 451508.

10. On July 8, 1998, the Company was approved for re-capitalization of earnings at NT$628,470,000 and re-capitalization of additional paid-in capital at NT$278,730,000 by the Securities and Futures Commission, Ministry of Finance (1998), Approval Document Number: Tai-Cai-Zheng (I) No. 57619.

11. On May 20, 1999, the Company was approved for re-capitalization of earnings at NT$292,665,680 and corporate bonds for capital at NT$6,014,010 by the Securities and Futures Commission, Ministry of Finance (1999), Approval Document Number: Tai-Cai-Zheng (I) No. 47567.

12. October 1999, Corporate bonds for capital at NT$23,440.

13. On June 29, 2000, the Company was approved for recapitalization of additional paid-in capital at NT$267,290,310 and corporate bonds for capital at NT$180,560 by the Securities and Futures Commission, Ministry of Finance (2000), Approval Document Number: Tai-Cai-Zheng (I) No. 56329.

14. On November 9, 2000, the Company was approved for capital increase by means of merger or acquisition of stock, at NT$371,525,000 by the Securities and Futures Commission, Ministry of Finance (2000), Approval Document Number: Tai-Cai-Zheng (I) No. 90247.

15. On May 22, 2001, the Company was approved for re-capitalization of earnings at NT$435,946,870 by the Securities and Futures Commission, Ministry of Finance (2001), Approval Document Number: Tai-Cai-Zheng (I) No. 131546.

16. On June 18, 2002, the Company was approved for capital increase by means of merger or acquisition of stock, at NT$501,333,660 by the Securities and Futures Commission, Ministry of Finance (91), Approval Document Number: Tai-Cai-Zheng (I) No. 0910132958.

17. December 19, 2002, The Company was approved for buyback of the Company’s shares to reduce capital at NT$268,240,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance (91), Approval Document Number: Tai-Cai-Zheng (San) No. 0910167268, February 26, 2003, Approval Document Number: Tai-Cai-Zheng (San) No. 0920106285 and June 12, 2003, Approval Document Number:Tai-Cai-Zheng (San) No. 0920126614.

18. July 17, 2003, The Company was approved for re-capitalization of earnings at NT$15,000,000 by the Securities and Futures Commission, Ministry of Finance (92), Approval Document Number: Tai-Cai-Zheng (Yi) No. 0920131289.

19. December 6, 2000, The Company was approved for buyback of the Company’s shares for transfer to employees which are not yet transferred for more than 3 years as capital reduction at NT$14,120,000 by the Securities and Futures Commission, Ministry of Finance (89), Approval Document Number: Tai-Cai-Zheng (San) No. 98643.

20. On June 3, 2004, the Company was approved for buyback of the Company’s shares to reduce capital at NT$187,380,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance (2004), Approval Document Number: Tai-Cai-Zheng (III) No. 0930124885.

21. On July 7, 2004, the Company was approved for buyback of the Company’s shares to reduce capital at NT$100,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0930130255.

22. On July 27, 2004, the Company was approved for re-capitalization of earnings at NT$15,000,000 by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-Yi-Zi No. 0930133470.

23. On September 1, 2004, the Company was approved for buyback of the Company’s shares to reduce capital at NT$89,800,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0930139490.

24. On June 14, 2005, the Company was approved for buyback of the Company’s shares to reduce capital at NT$24,650,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0940124037.

25. On December 28, 2005, the Company was approved for buyback of the Company’s shares to reduce capital at NT$55,960,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0940159771.

26. On April 9, 2008, the Company was approved for buyback of the Company’s shares to reduce capital at NT$28,300,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number:

27. 76 -

Jin-Guan-Zheng-San-Zi No. 0970015115.

1. On September 18, 2008, the Company was approved for buyback of the Company’s shares to reduce capital at NT$60,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0970026404.

2. On December 16, 2008, the Company was approved for buyback of the Company’s shares to reduce capital at NT$100,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0970035293.

3. Employee warrants at capital increase of NT$38,360,000.

4. On July 29, 2010, the Company was approved capital reduction at NT$508,363,420 by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 0990035554.

5. On September 22, 2011, the Company was approved for buyback of the Company’s shares to reduce capital at NT$60,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 1000046532.

6. On November 22, 2011, the Company was approved for buyback of the Company’s shares to reduce capital at NT$42,010,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 1000057786.

7. On December 26, 2011, the Company was approved for buyback of the Company’s shares to reduce capital at NT$60,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 1000063425.

8. On August 14, 2012, the Company was approved for buyback of the Company’s shares to reduce capital at NT$41,820,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 1010035989.

9. On November 2, 2012, the Company was approved for buyback of the Company’s shares to reduce capital at NT$31,950,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-San-Zi No. 1010049862.

10. October 26, 2015, The Company was approved for buyback of the Company’s shares to reduce capital at NT$100,000,000 for maintaining the Company’s shareholders’ equity by the Securities and Futures Commission, Ministry of Finance, Approval Document Number: Jin-Guan-Zheng-Jiao-Zi No. 1040043244.

11. On March 1, 2022, approved by the Hsinchu Science Park Administration, Ministry of Science and Technology, by letter Zhu-ZhangZi No. 1110006222 for the conversion of the Company's corporate bonds with issuance of new shares for additional capital of NT$29,599,240.

12. On March 22, 2023, approved by the Hsinchu Science Park Administration, Ministry of Science and Technology, by letter Zhu-ZhangZi No. 1120008738 for the conversion of the Company's corporate bonds with issuance of new shares for additional capital of NT$7,729,400.

(II) Type of Shares

				March 31, 2024 Unit: Shares
Shares Type		Authorized share capital		Note
	Issued shares	Un-issued shares	Total
Common Stock	256,446,475	243,553,525	500,000,000	Shares of listed company

Note: The aforementioned shares outstanding includes buying back treasury stock of 7,462,000 shares not yet transferred.

(III) Information on shelf registration: None

(IV) Shareholder structure

V) Shareholder structure	V) Shareholder structure	V) Shareholder structure	V) Shareholder structure	V) Shareholder structure	V) Shareholder structure	V) Shareholder structure	V) Shareholder structure
March 29, 2024 Unit: shares; %
Composition of shareholders Quantity				Foreign		Treasury shares	Total
	Governmental	Financial	Other juridical	institutions and	Domestic
	agencies	institutions	person	foreign	natural persons
				nationals
Number ofpeople	1	6	254	150	62,375	1	62,787
No. of shares held	4,010	2,132,650	44,368,363	17,301,527	185,177,925	7,462,000	256,446,475
Ownership	0.00%	0.83%	17.30%	6.75%	72.21%	2.91%	100.00%

• 77 -

(V) Composition of Shareholders

1. Common Stock

March 29, 2024

1. Common Stock			March 29, 2024
Shareholder ownership	Number of Shareholders	No. of shares held	Ownership
1 to 999	29,013	2,763,076	1.08%
1,000 to 5,000	28,281	54,984,248	21.44%
5,001 to 10,000	3,160	24,680,506	9.62%
10,001 to 15,000	870	11,163,035	4.35%
15,001 to 20,000	492	9,072,231	3.54%
20,001 to 30,000	370	9,481,220	3.70%
30,001 to 40,000	172	6,216,658	2.42%
40,001 to 50,000	112	5,200,406	2.03%
50,001 to 100,000	168	11,852,558	4.62%
100,001 to 200,000	84	11,333,785	4.42%
200,001 to 400,000	24	6,692,593	2.61%
400,001 to 600,000	10	4,897,500	1.91%
600,001 to 800,000	9	6,251,667	2.44%
800,001 to 1,000,000	2	1,743,757	0.68%
1,000,001 or above	20	90,113,235	35.14%
Total	62,787	256,446,475	100.00%

2. Preferred shares: The Company has not issued preferred stocks.

(VI) List of main shareholders

VI) List of main shareholders	VI) List of main shareholders	VI) List of main shareholders
March 29,2024
Shares Name of Main Shareholders	No. of shares held (shares)	Ownership (%)
Youe Chung CapitalCorporation	35,831,440	13.78%
Chao-YiWu	10,298,000	4.02%
Taiwan Mask Corporation	7,426,000	2.91%
Hui-Chen LaiWu	5,075,523	1.98%
PowerchipInvestment HoldingCorporation	4,121,000	1.61%
LidonChen	3,750,000	1.46%
Mei-Hui Li	2,290,000	0.89%
Vanguard Starlight Advanced Aggregate International Equity Index under the custody of Chase
	2,112,000	0.82%
Sean Chen	2,000,000	0.78%
Dedicated account with CTBC Bank Trust Investment entrusted byTaiwan Life Insurance
	2,859,000	0.78%

• 78 -

(VII) Market price, net worth, earnings (losses) and dividends per share and the related information for the most recent two years.

Unit: NTD/in thousands of shares

Item	Year	Year	2022	2023
Market Price Per Share (Note 1)	Highest		110.50	98.7
	Lowest		49.95	65
	Average		81.20	77.7
Net Worth Per Share (Note2)	Before distribution		22.16	24.04
	After distribution		19.28	22.28(Note 9)
Earnings per share	Weighted average shares		208,572	209,180
	Earnings pershare (Note 3)		3.37	1.75
Dividends per share		Cash dividends	2.5	1.5(Note 9)
	Bonus Share	-	-	-
		-	-	-
	Accumulated Un-allocated Dividends (Note4)		-	-
Return on Investment	Price / Earnings Ratio(Note 5)		24.09	44.4
	Price /DividendsRatio (Note 6)		32.48	51.8(Note 9)
	Cash DividendsYield (Note 7)		0.03	0.02(Note 9)

Note 1: Listing the highest and lowest market price of common shares for each year, and the average annual market price, which is calculated based on the actual transaction prices and volume for each year.

• Note 2: This information is filled in based on the number of issued shares by end of the year and the distribution decision made in the following year’s shareholders’ meeting.

• Note 3: If there is a need for retrospective adjustment due to issuance of bonus shares, shall list the earnings per share before and after the adjustment.

• Note 4: If the terms and conditions for issuance of equity securities state that the dividends not distributed for the current fiscal year may be accumulated to the fiscal year with earnings for distribution, shall disclose separately the accumulated amount of unpaid dividends until the current fiscal year.

• Note 5: Price / Earnings Ratio ＝ Average Market Price / Earnings Per Share of the year.

• Note 6: Price / Dividend Ratio ＝ Average Market Price / Cash Dividends Per Share of the year.

• Note 7: Cash Dividends Yield ＝ Cash Dividends Per Share / Average Market Price of the year.

• Note 8: Net Worth Per Share, Earnings per share shall be listed from the information audited (reviewed) by the accountant until the latest quarter of the annual report publication date; The remaining fields are listed for the current fiscal year until the annual report publication date.

• Note 9: The board resolution on March 6, 2024 approved the schedule of profit distribution.

(VIII) Company’s dividends policy and the implementation status

1. Dividends Policy

The Company adopts the policy for remaining dividends in response to the overall environment and industrial growth characteristics, and to the company’s long term financial plan, steady operations development. Yearly capital requirement is measured based on the Company’s future capital budget plan, capital required for retained earnings financing comes first, then the remaining earnings can be allocated based on the dividend method. Steps for distribution as below:

• (1) Decide on the best capital budget.

• (2) Decide on the financing required for one of the capital budget items.

• (3) Decide on the amount of the financing to be supported by retained earnings (methods such as cash capital increase or corporate bonds and so on can be adopted as support).

• (4) After retaining the portion required for operation needs out of the earnings remainder, the rest should be distributed to shareholders in the form of dividends. Cash dividends distribution proportion should not be lower than 20% of the total amount of dividends for the distribution proportion of the Company’s dividends.

• Status of dividend allocation approved by the board resolution

The Company proposed 2023 earnings distribution to the Board of Directors meeting on

• 79 -

March 6, 2024, distributing cash dividends for common stock at NT$373,476,713, cash dividends per share at approximately NT$ 1.5. Distribution of cash dividends adopts the calculation method of “round down to the nearest dollar,” fractions that do not amount to a full NT$1 shall be added and recognized by the Company as other income. While the distribution of earnings is kept at NT$1.5 per share, if there are regulatory changes by the competent authority or changes to the Company’s capital, such as conversion of convertible bonds into equity, which affect the number of shares outstanding before the dividends record date, the chairman is authorized to make changes to the profit distribution schedule, dividends record date and payment date and other relevant matters.

1. Explanation on dividends policy expected to have major changes: None.

2. (IX) The impact of bonus shares proposed by the shareholders’ meeting on the Company’s operating performance and earnings per share

Not applicable, none is proposed this time.

• (X) Employee, director remuneration

• The Company Charter’s employees, directors’ remuneration amount or scope: The Company shall distribute not less than 10% of the current year’s profit situation for employee remuneration and not more than 2% of current year’s profit situation for director remuneration. However, profits must first be taken to offset against cumulative losses, if any. Employee remuneration, as mentioned above, can be paid in cash or in shares. Qualified employees of subsidiaries are also included in the payment.

  • Current year profit situation as mentioned in the first paragraph refers to the profit which is the current year’s pre-tax profit before distribution of employee remuneration and directors remuneration.

  • The distribution of employee and director remuneration shall be executed after the resolution approval at the Board meeting with more than two-thirds of directors attending and of more than half of the attending directors agreed and passed the resolution, and reported to the shareholders meeting.

• The basis for estimating the amount of employee and director compensation, for calculating the number of shares to be distributed as employee compensation, and the accounting treatment of the discrepancy, if any, between the actual distributed amount and the estimated figure, for the current period:

The estimation of employee and director compensation is based on the Company Charter as a basis. If there are any differences between the actual distributed amount and the estimated figure, the differences will be listed as income (loss) in the following fiscal year.

1. Earnings of 2022 for distribution of employees’ and directors’ remuneration:

Unit: NTD

	Distribution plan proposed to Board of Directors	Actual distribution	Difference
I. Distribution Compensation for Directors and Supervisors Employee Compensation in Cash Employee Compensation in Stocks II. Related information for earnings per share Original earnings per share Calculated earningsper share	18,000,000 102,000,000 - 3.37 3.37	18,000,000 102,000,000 - 3.37 3.37	None None None None None
Note: There are no differences between actual distribution and recognized employee and director remuneration.

• 80 -

• Earnings of 2023 for distribution of employees’ and directors’ remuneration approved by the Board of Directors:

Unit: NTD

	Distribution plan proposed to Board of Directors	Actual distribution	Difference
I. Distribution Compensation for Directors and Supervisors Employee Compensation in Cash Employee Compensation in Stocks II. Related information for earnings per share Original earnings per share Calculated earningsper share	12,000,000 80,000,000 - 1.75 1.75	Note Note - Note Note	Note Note Note Note Note
Note: The abovementioned remuneration for directors, supervisors and employees have been expensed in 2023, and the recognized amount is no different from the amount proposed by the board of directors on March 6, 2024.

(XI) Stock buybacks of the Company: None.

• 81 -

II. Handling situation of corporate bonds:

(I) Handling situation of corporate bonds

andling situation of corporate bonds	andling situation of corporate bonds
Type of Corporate Bond		The 3rd domestic unsecured convertible bonds
Issuing (Processing)Date		August 3,2021
Par value		NT$100,000
Listing		Taipei Exchange
Issuanceprice		Issued at 115.23%ofpar value
Total amount		NT$2,304,532,020
Interest rate		The coupon rate is 0% per annum
Maturity		5-year maturitydate: August 3,2026
Guarantor		None
Trustee		Trust Department of Mega International Commercial Bank
Underwriter		KGI Securities Co.,Ltd.
Certifyinglawyer		AttorneyYa-Wen Chiu of HANDSOME ATTORNEYS-AT-LAW
CertifyingCPA		Not applicable
Repayment method		Convert to common shares of the Company pursuant to Article 10 of the Issue and Conversion Measures or exercise the right of sale in accordance with Article 19 of the Measures or redeem early in accordance with Article 18 of the Measures or the Company shall repay in cash the face value of the convertible bonds at maturity, unless the bonds are repurchased and retired by the Company from the securities dealer's office.
OutstandingPrincipal		NT$1,675,600,000(as of March 31,2024)
Redemption or Early Repayment Terms		The Issue and Conversion Measures
Restrictive clauses		The Issue and Conversion Measures
Credit Rating Agency, Date of Rating, Corporate BondCredit Rating		None
Other Rights	The amount of converted common stock (exchange or warrants), global depository receipts or other securities as of March 31,2024	Already converted 3,732,864 common shares NT$37,328,640
	Issuance and conversion (exchange or subscription) method	See the issue and conversion measures for the Company’s 3rd domestic unsecured convertible bonds
Issuance and conversion, exchange or subscription methods, issuance conditions, possible dilution of equity, and impact on existingshareholders’ equity		Based on the current outstanding balance and conversion price, it is estimated that 20,334,951 common shares, representing approximately 7.93% of the total issued shares, may be converted.
Custodian		None

• 82 -

Unit: NTD

				Unit: NTD	Unit: NTD
Type of Corporate Bond		2022 first series domestic secured convertible corporate bonds		2022 second series domestic secured convertible corporate bonds
		Bond A	Bond B	Bond A	Bond B
Issuing (Processing) Date		2022/09/28	2022/09/28	2022/12/27	2022/12/27
Total Amount		NT$300 million	NT$200 million	NT$200 million	NT$300 million
Denomination		NT$1,000,000
Listing		Taipei Exchange
Issue Price		Issued at face value
Annual interest rate (fixed)		1.80%	1.80%	2.20%	2.38%
Term		5 years		5 years
Guarantor		Mega International Commercial Bank	First Commercial Bank of Taiwan	Shanghai Commercial and Savings Bank	Taichung Commercial Bank
Trustee		Bank SinoPac
Underwriter		Mega Securities Co., Ltd.
Legal Counsel		None
Attesting CPA		None
Redemption Method		A single repayment of principal at maturity
Outstanding Principal		NT$300 million	NT$200 million	NT$200 million	NT$300 million
Terms of redemption or early repayment		None
Restrictive clauses		None
Credit Rating Agency, Date of Rating, Corporate Bond Credit Rating		Rating date: 2021/10/26 Taiwan Ratings: twAAA	Rating date: 2021/10/12 Taiwan Ratings: twAA+	Rating date: 2022/01/17 Taiwan Ratings: twAA	Rating date: 2022/5/10 Fitch Ratings: FitchA(twn)
Other Rights	The amount of converted common stock (exchange or warrants), global depository receipts or other securities as of March 31,2023	None
	Measures for Issuance and Conversion (Exchange or Subscription)	None
Issuance and conversion, exchange or subscription methods, issuance conditions, possible dilution of equity, and impact on existing shareholders’ equity		None
Custodian		None

• 83 -

Unit: NTD

			Unit: NTD
Type of Corporate Bond		2023 second series domestic secured convertible corporate bonds	2023 first series domestic secured convertible corporate bonds
Issuing (Processing)Date		12/12/2023	08/28/2023
Total amount		NT$500 million	NT$300 million
Par value		NT$1,000,000
Listing		Taipei Exchange
Issuanceprice		Issued at face value
Annual interest rate(fixed)		1.80%	1.62%
Maturity		5years	5years
Guarantor		HUA NAN COMMERCIAL BANK,LTD	Taiwan Cooperative Bank
Trustee		Bank SinoPac
Underwriter		HUA NAN COMMERCIAL BANK Songshan Branch	Taiwan Cooperative Securities Co., Ltd.
Certifyinglawyer		None
CertifyingCPA		None
Repayment method		A single repayment ofprincipal at maturity
Outstanding principal		NT$500 million	NT$300 million
Redemption or Early Repayment Terms		None
Restrictive clauses		None
Credit Rating Agency, Date of Rating, Corporate Bond Credit Rating		Rating date: July 14, 2023 Taiwan Credit Rating: twAA+	Rating date: February 17, 2023 Taiwan Credit Rating: twA-A
Other Rights	The amount of converted common stock (exchange or warrants), global depository receipts or other securities as of March 31,2024	None
	Issuance and conversion (exchange or subscription)method	None
Issuance and conversion, exchange or subscription methods, issuance conditions, possible dilution of equity, and impact on existing shareholders’ equity		None
Custodian		None

• 84 -

(II) Information on convertible bonds

Type of corporate bonds	Type of corporate bonds	The 3rd domestic unsecured convertible bonds	The 3rd domestic unsecured convertible bonds
Items	Year	2023	The current year up to March 31
Market price of convertible bonds	Highest	116.40	103.75
	Lowest	100.40	101.05
	Average	107.41	102.98
Conversion price		NT$82.4 (Note 1)
Issuance (transaction) date and conversion price at issuance		Date: August 3, 2021 Conversion price: $88.8
Method of fulfilling the conversion obligation		Issuance of new shares

Note 1: The conversion price was adjusted from NT$82.4 effective July 28, 2023

III. Preferred shares: None.

• IV. Overseas depositary receipts: None.

• V. Employee stock warrants and employee new restricted shares: None.

• VI. Merger or acquisition, issue of new shares in connection with the acquisition of shares of another company: None.

VII. Financing plans and implementation

1. The Company’s 2023 1st series domestic secured convertible bonds, which raised total capital of NT$300 million, have been approved on record by Zheng-Gui-Zhai-Zi No.11200093161 on August 21, 2023, and the implementation of the capital utilization plan is as follows: The total amount planned was NT$300 million, and the actual amount of funds raised was NT$300 million, all of which was used to repay loans from financial institutions. As of Q3 2023, the achievement rate was 100%, indicating that the implementation has been fully completed.

2. The Company’s 2023 2nd series domestic secured convertible bonds, which raised total capital of NT$500 million, have been approved on record by Zheng-Gui-Zhai-Zi No.11200123052 on December 11, 2023, and the implementation of the capital utilization plan is as follows: The total amount planned was NT$500 million, and the actual amount of funds raised was NT$500 million, all of which was used to repay loans from financial institutions. As of Q4 2023, the achievement rate was 100%, indicating that the implementation has been fully completed.

3. 85 -

Five. Overview of operations

I. Business Activities

• (I) Scope of business

• Main businesses operated and business proportions

• (1) Research and development, production, manufacturing and sales of photomask.

• (2) To provide technical assistance, consulting, testing and certification, maintenance and repair services relating to the aforesaid products.

The Company's main business is the production of photomasks for microfilming processes, of which semiconductors account for more than 90% of the total number of customers, while others are photomasks for liquid crystal displays (LCDs) and wafer-level chip packaging (WLCSPs).

1. Current commodities and services of the company

With the continuous evolution of IC fabs and production equipment in the semiconductor market, the Company’s available photomask products are listed below.

Customer industry type	Customer’s machine model	Photomask specification
IC	Stepper,Scanner	projection5X/4X/2.5X/2X Reticle(5”&6”)
LCD	Nikon	masks upto 7”
CCD	Cannon	Chrome contactprints
Transistor	Projection Aligner	1X Reticle
Diode	ProximityAligner	1X full field
LED	ASML	(4”~7”)
-	Ultratech	Large area mask(8”~24”)

1. Plans for new products and services development

In response to the diversification of semiconductor high-end product specifications, we will continue to develop diverse photomasks for ArF phase shift (PSM) and provide advanced optical peripheral lining (OPC) services to facilitate further cooperation with our customers in developing photomasks for deep submicron processes.

(II) Overview of the industry

Photomasks play a key role in the IC industry chain, accounting for 13% of semiconductor manufacturing materials, and their product specifications are mainly developed in accordance with the IC technology blueprint. Due to the increasing demand for precision in the IC industry, the most advanced photomask technology has been developed and produced below 2nm, and the Company has invested in new equipment and developed the related process. Currently, the technology has been certified by the customers related to 65/55nm process and is in mass production.

In the LCD market, photomasks can be applied to the manufacturing of small and medium-sized panels with higher resolution, stitching several photomasks to meet the panel manufacturing process requirements. In addition, with advances in packaging and testing technology, processing gold bump and RDL on wafer also requires photomask for pattern transfer. The 9” photomasks (for 8” wafers) and 14” photomasks (for 12” wafers) provide a solution.

As wafer manufacturing technology advances, many high level lithography requires cosolution to be identified by manufacturing processes, IC design and photomask craft.

• 86 -

Therefore, world-class IDM and Foundry companies have set up their own photomask departments. Optical Proximity Correction Mask (OPC) and Phase Shift Mask (PSM) are widely used in 8” and 12” foundries. The self-built photomask departments accounts for about 63% of the global photomask market, while professional photomask manufacturing companies account for about 37%. In 2022, for example, the global annual production value of photomasks is about US$5.5 billion, and will continue to grow in the future in response to the demand for new products.

1. Future industry development trend

However, as the process technology continues to evolve, the density of memory continues to increase and the capacity of the required equipment continues to rise, many memory manufacturers are converting their old equipment to foundry production equipment. Investments and technology baseline for photomask is not low, and these capacities switching to foundry require professional photomask factories to provide photomask manufacturing services. and with many consumer products in the market and the trend of green energy saving, mature middle level photomask demands continue on the rise. As a result, world-class IDM and Foundry companies emphasize on high-level photomask investments and manufacturing, and continue to outsource related photomask mature manufacturing technology. Therefore, for the Company, expectations for future industry developments and market prospects are worthwhile.

In addition, with the growing demand in automotive, mobile phone, industrial, communication, and energy applications, as well as the rapid development of emerging technologies such as high-performance computing and R&D of new material process, the semiconductor market and its technology R&D will continue to grow. Other highly growth markets, including applications such as self-driving vehicles, driver assistance systems, artificial intelligence, machine learning and image recognition have a strong demand for advanced processors. With the active promotion of the third generation semiconductor materials, the applications are increasing day by day, and the demand for photomasks is also increasing, too. As the technology for handheld communication products, AI and IOT applications improves, it is becoming increasingly difficult to complete system integration chips on a single wafer fabrication process, and relying on packaging technology to integrate integrated circuits from different processes has become a key technology necessity. These new demands have also boosted the use of photomasks, which is what we are striving for.

1. Overall economy, industry development trends and product competitiveness

The impact of the US-China trade war in the past few years has changed the face of the world economy, especially the US ban on China's semiconductor-related supply chain, which has deeply affected the development of the electronics industry on both sides of the Taiwan Strait. In the short term, China is actively seeking to establish its own technology and investing heavily in semiconductor-related industries, but technology development cannot be achieved overnight, and relying on Taiwan's assistance and supply is becoming increasingly important. In the past few years, IC design companies have been established like mushrooms after rain in China, and 12-inch fabs have been expanding, which are new markets that we can explore.

TMC was founded in 1988 and has 35 years of experience in manufacturing services and has accumulated more than 400 customers. It has certain advantages in production capacity, manufacturing quality and production cost of mature photomask. As the

• 87 -

photomask market continues to develop, competing companies are entering the photomask manufacturing service market through investment or merger and acquisition. In the future, only by continuously improving operational performance and expanding 12-inch photomask manufacturing service capacity can we stand firm in the photomask manufacturing service field and gradually increase our market share.

4. Relationships of upstream, midstream and downstream of the industry

==> picture [413 x 181] intentionally omitted <==

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

Circuit design Photomask fabrication Chip manufacturing Chip package
Photomask
Logic design Oxidation Cutting
fabrication
Circuit design Protective film Mask alignment Placement
Circular design Etch Wire bond
Impurity diffusion Modeling
Implantation of
Testing
impurities
Chemical vapor
deposition
Metallic electrodes
Wafer evaporation
Chip probing
Long single Chip inspection
crystal
Slicing
Grinding Shipping
----- End of picture text -----

(III) Overview of technologies, research and development

In recent years and until the annual report publication date, invested research and development expenditure and successful development of technology or products.

Year	Research and development expenditure	Successful development of technology
2023	NT$348,136 thousand	Developed 40/55/65 nm photomask mass production technology.

• (IV) Long- and short-term business development plans

• Short-term plan: increase 55/65nm market share; expand the share of mature photomask manufacturing.

• Intermediate-term plan: Introduced mass production of 28/40 nm photomasks.

• Intermediate to long-term plan: Continue to invest in advance photomask development, and research and develop new fabrication processes and expand new customer sources.

II. Status of the market and production/sales:

• (I) Market analysis

• Sales region of major products

The semiconductor industry in Taiwan is in a leading position globally, foundry market share accounts for more than half of the global market, IC design industry ranks second globally. TMC possesses geographical advantages, placing much effort in managing the domestic market, thus, domestic sales accounts for more than half of total sales as the previous years. In the past three years, we have been working hard to develop markets in China, Korea, and Southeast Asia, and have achieved good results. Asia market still stands for a larger proportion than other international markets. Since photomask customers demand for high quality photomask, rapid shipments, convenient communications, Europe

• 88 -

and USA regions with greater time zone differences seem to present inconveniences for sales expansion into these regions, also long distance means a longer shipping time. Both years were dominated by domestic and Asian markets.

				Unit: NT$Thousand; %	Unit: NT$Thousand; %
Year Region		2022		2023
		Amount	％	Amount	％
Domestic	Domestic	2,929,266	37.84	2,839,639	39.44
Overseas	Asia	4,753,060	61.40	4,267,501	59.27
	Others	58,792	0.76	92,795	1.29
Net sales		7,741,118	100.00	7,199,935	100.00

2. Expansion of high-end products

Affected by the shrinking global end demand since 2022, the external environmental factors have not been eliminated, the buying momentum in the consumer market is poor, and the purchasing power is weak. From end user, system makers, until the players in the supply chain of the semiconductor chip production and sales have elevated inventory. The pressure of inventory closeout continued into 2023, affecting the overall demand for semiconductor products.

In the table below, it is obvious that the sales of <=0.13um have declined slightly by 5%, from NT$1.021 billion in 2022 to NT$1.137 billion in 2023.

						Unit: NT$	Thousand YoY 29%
	2022				2023 By
		Sales income	YoY			Sales income	YoY
	Technology				technology
	<=0.13	1,202,394	36%		<=0.13	1,137,241	29%

3. Future supply, demand and growth of the market

Under the continuous evolution of foundry processes, advanced process development is the main axle to enter the mainstream market with high return on investment and high growth, and to meet the growing demand for 5G, automotive and Internet of Things (IoT) devices that rely heavily on analog, power management and display driver integrated circuits (ICs), power components MOSFETs, microcontrollers (MCUs) and sensor technology, resulting in a supply shortage dilemma. shortage dilemma. TMC has sufficient production capacity in this part, coupled with the efforts of all colleagues in the past few years, both delivery and quality are well recognized by customers, and still has an advantage in the coming years.

However, as we all know, the advancement of semiconductor wafer fabrication process will not stop, if we only stick to our original technology and production, our business will gradually shrink and we will lose our competitiveness. Therefore, starting from 2019, the Company incrementally invested in new production equipment, developed new technology, allowing the business to extend to the 12-inch market beyond concentrating in the 6-inch and 8-inch market. Gradually cultivating towards new technology discipline with steady steps.

Looking into the future, the Company has accrued over 30 years of photomask technology experiences, and as mentioned previously, the Company has its unique way in special and large-size photomask manufacturing as its competitive advantage. By taking steady steps with its operation strategies and business expansion, great results can be expected. Especially after the merger and acquisition of Miracle Technology CO., LTD. in

• 89 -

October 2017, the supplier relationship with the wafer plant has transitioned to a partner relationship between photomask supplier and wafer customer. The result from such a change is gradually reflected in the increasing photomask orders coming from wafer plants in Taiwan, Korea and so on. On the other hand, as Miracle Technology has three subsidiaries deeply cultivated in the Chinese mainland market, this has also assisted the Company in its business expansion in this market.

1. Competitive niche

2. (1) We have sufficient mature process capabilities and advanced development technologies, including 0.18 micron (and above), 0.15 micron, 0.13 micron, 0.11 micron and 90 nanometer, and even 65/55 nanometer, which has been developed for mass production, to provide satisfactory delivery services to our customers.

3. (2) Mergers and acquisitions with Miracle Technology and Aptos Technology create a more complete service for IC design companies, from photomask manufacturing, foundry service to packaging and testing, providing customers total solutions service.

4. (3) With advantages in professional photomask technology in addition to integration with Miracle Technology’s professional manufacturing technology, assist customers to develop unique photomask or manufacturing technology heightening customer’s competitiveness.

5. Factors favorable and unfavorable to the development, and countermeasures

6. (1) Favorable factors

   • A. Taiwan, China and various countries in South East Asia are expansively building 8-inch and 12-inch foundries engaging in foundry service, this will comparatively increase demands for photomask.

   • B. We have complete and mature photomask technology for 65/55nm (and above) for each process with the product service platforms the processes need.

   • C. The production has reached the economic scale with high yield rate, and has the advantage of certain output value compared with other photomask factories.

   • D. Good financial structure and timely investment in relevant production equipment in response to market demand.

   • E. After merger and acquisition with Miracle Technology, is able to provide a more complete service for IC design companies.

7. (2) Unfavorable factors

   • A. Changes in the division of profession in the global semiconductor supply chain outsourcing model.

   • B. Insufficient domestic labor supply resulting in a surge in salaries.

   • C. Lack of overseas layout and local production service.

   • D. Late start of middle and high end process, still need to develop and obtain fab certification gradually.

8. (3) Company countermeasures

   • A. Expedite information processing by purchasing fast computers to process customer’s product design at a faster rate and shorten the delivery time.

   • B. Systemized operations to raise work efficiency, reduce wastage, lower costs, and gradually reduce labor demand.

   • C. Purchase new equipment models, expand production scale, supply various demand levels of photomask, balance profitability standards of various levels of photomask, to increase competition.

   • D. Enhance expansion of overseas businesses, increase revenues and profits.

   • E. Understand the needs of customers and develop the photomasks required for

9. 90 -

product applications to strengthen customer relationships.

  - F. Collaborate with 12-inch foundries to develop photomask technology, gradually enter a high level market winning customers’ recognition and trust.

• (II) Key uses and production process of main products Photomask is an irreplaceable mold in the integrated circuit manufacturing process. Basically, photomask is comparable to the film in developing photos, and possesses a similar function to the film, the only difference is its image is in the form of a circuit. Photomask material itself is a very flat glass, it could be quartz glass, soda lime glass or borosilicate glass, coated with an ultrathin layer of chromium. The manufacturing process of photomask involves the following: use the computer to accurately store the circuit patterns required in integrated circuit in a hard drive, followed by using the pattern generator to expose the circuit pattern onto the glass panel which is coated with photosensitive material, passing through development and chemical etching processes to fixate the circuit pattern on the glass panel, then it is ready to pass on to chip manufacturing plant that fabricates wafers for usage.

• (III) Supply status of main raw materials

• The blank photomask raw materials that the Company uses are purchased from major producers in Japan and Korea. The protective film is partly supplied from domestic producers and the insufficient portion is purchased from major producers in Japan, USA and Korea. Photomask packaging boxes are partially supplied by domestic suppliers, and the rest are supplied by manufacturers in Japan, the US and Korea. Chemicals are purchased from Japan, the US and Germany, and some domestic manufacturers are capable of supplying the Company.

• Raw materials can be supplied domestically.

• As for parts and accessories, key machines are supplied by original equipment suppliers, and some machine parts and accessories are supplied by domestic manufacturers. The Company’s equipment mainly comes from the US, Japan and Germany.

• (IV) List of major suppliers and customers in the two most recent fiscal years

• Major Suppliers in the two most recent fiscal years

Unit: NT$Thousand

Items		2022	2022			2023	2023
	Name	Amount	Ratio of the net purchase of the year (%)	Relationship with the issuer	Name	Amount	Ratio of the net purchase of the year (%)	Relationship with the issuer
1	KEY FOUNDRY Co.,Ltd.	1,478,670	46	None	KEY FOUNDRY Co.,Ltd.	792,378	26	None
2	Vanguard International Semiconductor Corporation	333,877	10		-	-	-
3	Others	1,438,436	44		Others	2,199,639	74	None
Net Purchase		3,250,983	100			2,992,017	100

Note: Reasons for changes in proportion of goods imported: Due to the differences in sales proportion of the products, resulting in differences in the imported materials and suppliers.

• 91 -

2. Major customers in the two most recent fiscal years

Unit: NT$Thousand

Items		2022	2022			2023	2023
	Name	Amount	Ratio of the net sales of the year (%)	Relationship with the issuer	Name	Amount	Ratio of the net sales of the year (%)	Relationship with the issuer
1	A	936,993	12	None	A	845,000	12	None
2	Others	6,804,125	88		Others	6,354,935	88
Net Sales		7,741,118	100		Net Sales	7,199,935	100

Note: The Company’s clientele is more divided. There was only one customer with net sales for over 10% the last two year.

(V) Production volume and value in the most recent two years

Unit: 1000 pieces / NT$ Thousand

Production volume and value Main Products		2022			2023	2023
	Production capacity	Volume	Value	Production capacity	Volume	Value
Photomask	68	67	1,796,579	71	64	2,322,564
Wafer Foundry Agency Services	-(Note 1)	-(Note 1)	2,311,785	-(Note 1)	-(Note 1)	1,369,642
Others	-(Note 2)	-(Note 2)	1,534,129	-(Note 2)	-(Note 2)	1,671,360
Total	-	-	5,642,493	-	-	5,363,566

Note 1: Not engaged in production and only received service revenue, therefore, no capacity and production. Note 2: Due to the variety of products and different units, the quantities are not aggregated.

(VI) Sales volume and value in the past two years

Unit: 1000 pieces / NT$ Thousand

I) Sales volume and	value in the past two years	value in the past two years	value in the past two years	value in the past two years	Unit: 1000 pieces / NT$ Thousand	Unit: 1000 pieces / NT$ Thousand	Unit: 1000 pieces / NT$ Thousand	Unit: 1000 pieces / NT$ Thousand
Sales year Quantit Main Products (or department)	2022				2023
	Domestic sales		Export		Domestic sales		Export
	Volume	Value	Volume	Value	Volume	Value	Volume	Value
Mask	38	2,009,758	29	1,877,890	31	1,778,974	33	2,171,435
Wafer Foundry Agency Services	-(Note 1)	729,345	-(Note 1)	1,717,339	-(Note 1)	346,145	-(Note 1)	1,224,998
Others	-(Note 2)	190,163	-(Note 2)	1,216,623	-(Note 2)	714,641	-(Note 2)	963,742
Total	-	2,929,266	-	4,811,852	-	2,839,760	-	4,360,175

Note 1: Not engaged in production and only received service revenue, therefore, no capacity and production. Note 2: Due to the variety of products and different units, the quantities are not aggregated.

• 92 -

III. Employee information

	Year	2022	2023
Number of Employees	Technical personnel (Engineering)	293	387
	Management and sales personnel	364	374
	Operation personnel	434	585
	Total	1091	1346
Averageage		40.81	40.84
Averageyears of service		5.66	3.92
Distribution of Educational Background	Doctoral degree	1.47	1.34
	Master’s degree	16.13	16.42
	University (College)	61.04	56.24
	Senior High School	19.71	21.69
	Below Senior High School	1.65	4.31

IV. Expenditures on environmental protection

• (I) No loss incurred due to pollution as of 2023 and up to the date of publication of the annual report.

• (II) Future countermeasures and possible expenditures

 Countermeasures

The Company’s products go through the processes of exposure, development, chemical etching, stripping, followed by rinsing them in strong acid for cleaning before packaging them. These processes use chemicals for treatment and the Company wants to avoid pollution from occurring, thus, set up a neutralizing treatment tank for treating wastewater containing acids and alkalis from these processes. Wastewater is treated and released controlled within the standards as regulated by laws and regulations on national level and of the science park management bureau. In the area of preventing pollution and environmental protection measures, the Company has comprehensive wastewater and air pollutant emissions treatment equipment. Specifically, for preventing possible long-term damage effects from the wastewater pond polluting underground water sources, the wastewater pond was designed “overhead”, managing personnel can check for leakages anytime. This is the most advanced wastewater treatment equipment globally. Air emissions go through the active carbon adsorption tower and washing column processes before being released. After the wastewater goes through this first stage treatment to meet the standard of the Hsinchu Science Park Bureau for sewer connection, it will be released to the wastewater treatment center of the Science Park for second time treatment.

The Company has placed environmental protection as first priority since establishment, thus, up till now, there have been no occurrences of environmental pollution.

The Company’s products do not have direct or indirect relations to laws and regulations relating to overseas sales to Europe or EU's Restriction of Hazardous Substances (RoHS) Directive.

93

 Expenditure for environmental protection

1. 2023 environmental protection-related expenditures were NT$12,336 thousand, related routine maintenance, cleaning and transportation, treatment, testing and permit application fees were NT$5,082 thousand. NT$7,254 thousand was spent on maintenance and renovation of treatment facilities, of which about NT$5,545 thousand was for wastewater area refurbishment; renewal of scrubber control system for air pollution prevention equipment and scrubber circulating water system to improve removal rate cost about NT$2,300 thousand; the wastewater treatment system was updated to improve the treatment efficiency of wastewater discharge, and automatic control functions were added for control of abnormal water quality backflow for compliance with environmental protection regulations. The waste acid recovery project of the production line of Plant#3 has been officially operational, which has greatly reduced pollution discharge and wastewater dosing, and an average of 13 tons of waste sulfuric acid per month can be recovered.

2. In 2023, a total of six power-saving projects were implemented, saving 517,138 kWh/year of electricity (accounting for 0.16% of the annual power consumption of TMC), and reducing carbon emissions by 255.98 metric tons of CO2e/year. Examples are as follows:

3. (1) Seven new inverters were added to the RCU air-conditioning box. By reducing the frequency, each unit saves about 57,754 kwh/year. This year, based on the date of construction, the total power consumption was 233,226 kw in this year.

4. (2) One old MAU was replaced. The humidification method was changed from electric boiler to water washer, and the heating method was changed from electric heating rod to heat pump, which saved a total of 172,866 kw this year.

5. (3) The chiller system load is allocated and some motors have been shut down, and 27,375 kw was saved.

6. (4) The central vacuum system has been configured to reduce the number of small vacuum pumps in the factories, while stabilizing the vacuum pressure, and reduce the standby time caused by replacement. This year, a total of 10,433kw was saved.

7. (5) A total of 287 FFU units in cleanroom were replaced with high high static pressure energy-saving types, which saved a total of 51,337kw this year.

8. (6) The cooling tower fins have been replaced with new ones. The average power consumption of the chiller throughout the year is 2,628,000 KW. The replacement of the cooling towers reduces the temperature difference between the cooling water (inlet and return water) by 1ºC, and for every Celsius degree of the temperature difference between inlet and return water saves 2% power consumption. The power consumption of the chiller for the year is 2,628,000KW*2% = 52,560KW, and the total power saved for the year was 21,900 kW.

9. Future plans

10. For 2024, an environmental protection budget of NT$15,000 thousand will be for the set up of a waste sulfuric acid recovery system construction

94

project in Plant #1 and #2, which is expected to recover 50 tons a month and reduce the monthly liquid caustic soda added to the wastewater system by 60 tons. In response to the increase to the production capacity, wet bench machine is expected to meet the water conservation goals of 10 ton/day for short-term, 20 ton/day for intermediate-term, and 30 ton/day for long-term, and box washing machine is set up to make the pure water recovery rate from machines reach 100% and return the water to the RO2 system storage tank. Renovation project for the wastewater system of Plant 1, and renovation of the overflow tank and raw water tank were conducted to avoid soil and groundwater pollution. Plant 3 added a zeolite runner VOC treatment system to improve the efficiency of organic waste gas treatment. The acid exhaust system is equipped with an extraction motor automatic backup system to improve the efficiency of the exhaust gas treatment system.

The Company will continue to adhere to the philosophy of social responsibility and sustainability. In response to the increase in production capacity, environmental protection related expenditures, such as routine maintenance, cleaning and transportation, treatment and testing and general maintenance of treatment facilities, will also increase. It is hoped that the promotion of energy conservation and carbon reduction projects will mitigate the environmental impact caused by operations, further creating economic and social values.

V. Labor relations information

• (I) Employee benefit plans, continuing education, training, retirement systems and the status of their implementation, as well as the status of labor-management agreements and measures for preserving employees' rights and interests.

• Status of the Company’s employee benefit measures, continuing education and trainings

  • [Salary and motivation system]

    • Salary and multiple rewards system (Dragon Boat Festival, MidAutumn Festival and year-end bonus), additional performance bonus and allocation of earnings, production bonus, station allowance

    • Flexible salary adjustment for individuals

    • Employee bonus, employee stock option

  • [Life care and protection]

    • Enjoy complete group insurance (free life insurance/accident insurance/hospitalization medical treatment/accident medical treatment/occupational hazard)

    • Cash gifts and subsidies for child birth, weddings, death in the family

    • Birthdays/occasions gift vouchers

    • Free annual employee health check-ups

    • Appointed store

    • Welfare committee to regularly organize travels and various sporting events and domestic and overseas travel subsidies

    • Employee health care, regular visits by doctors and nurses providing onsite care, professional consultation sessions and suggestions for employees

    • Christmas party

95

[Convenient facilities]

• Provides complete indoor employee parking spaces

• Free gym with dedicated fitness trainer

• Indoor badminton court, tennis court, table tennis and so on leisure facilities

• Established lactation room, complete facility for use by female employees

• Established employee canteen provides free meals, coffee, tea beverages, and 180-inch large screen viewing

• Provides accommodation for job candidates from other cities

• [Trainings]

• Provides new employee educational trainings

• Conducts work trainings based on the employee’s work requirements

• Provides external trainings to employees for self-learning and growth

2. Retirement scheme

The Company has established a retirement plan with defined payment for formal employees based on the Labor Standards Act, making monthly payments to the retirement fund account with Bank of Taiwan. Effective July 1, 2005, the Company has established a defined contribution pension plan (the “New Plan”) under the Labor Pension Act (the “Act”), covering all regular employees with domestic citizenship. Under the New Plan, the Company contributes monthly an amount not less than 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

1. Labor agreement and various employees’ rights and interests’ protection status

2. Regularly hold labor-management meetings, allowing friendly communications between employees and company.

3. Provide an internal web-based platform, sharing information and instant interactions with employees.

4. (II) Any loss sustained by the company as a result of labor disputes and the estimate of losses incurred to date or likely to be incurred in the future in the most recent fiscal year and up to the date of the publication of the annual report: None.

VI. Important contracts

The Company has not entered into any material contracts, except for general commercial transactions.

In addition, the Company also disclosed “material contingent liabilities and unrecognized contractual commitments” in the latest annual (2023) CPA-audited and attested consolidated financial statements. (Page 68)

96

Six. Overview of Financial Status

I. Information on condensed balance sheets and statements of

comprehensive income for the past five fiscal years

• (I) Condensed balance sheets - IFRS (consolidated)

Unit: NT$ Thousand

(I)Condensed bala	(I)Condensed bala	nce sheets - IFRS (consolidated)	nce sheets - IFRS (consolidated)	nce sheets - IFRS (consolidated)	Unit: NT$ Thousand	Unit: NT$ Thousand
Year		Financial information for thepast			five fiscalyears(Note 1)
Item		2019	2020	2021	2022	2023
Current assets		2,258,934	2,429,726	8,435,838	5,903,882	5,910,895
Property, plant and equipment		1,546,919	3,108,099	4,142,224	5,883,661	9,405,807
Intangible assets		126,776	173,724	387,866	497,180	721,410
Other assets		1,793,741	3,390,159	3,148,299	5,608,183	4,885,947
Total assets		5,726,370	9,101,708	16,114,227	17,892,906	20,924,059
Liquidity	Before distribution	1,718,406	3,677,416	6,369,661	6,979,765	8,623,904
Liabilities	After distribution	1,971,120	4,056,487	6,852,039	7,584,668	8,997,381
Non-current liabilities		886,506	1,975,859	4,874,387	6,478,934	7,250,839
Total Liabilities	Before distribution	2,604,912	5,653,275	11,244,048	13,458,699	15,874,743
	After distribution	2,857,626	6,032,346	11,726,426	14,063,602	16,248,220
Equity attributable to shareholders of the parent company		2,990,222	3,538,598	5,100,527	4,546,920	5,123,142
Capital		2,527,136	2,527,136	2,556,735	2,564,465	2,564,465
Capital surplus	Before distribution	322,777	439,898	1,315,828	1,251,681	1,439,959
	After distribution	-	-	1,074,639	1,203,289	1,439,959
Retained	Before distribution	977,513	1,405,273	2,165,355	2,499,245	2,291,561
Earnings	After distribution	724,799	1,026,202	1,924,166	1,942,734	1,918,084
Other equityinterests		(1,872)	889	4,032	10,508	1,641
Treasurystock		(835,332)	(834,598)	(941,423)	(1,778,979)	(1,174,484)
Non-controlli	ngInterests	131,236	(90,165)	(230,348)	(112,713)	(73,826)
Equity	Before distribution	3,121,458	3,448,433	4,870,179	4,434,207	5,049,316
Total Amount	After distribution	2,868,744	3,069,362	4,387,801	3,829,304	4,675,839

Note 1: The aforementioned financial information from 2019 to 2023 were audited and verified by a certified accountant.

Note 2: The Company’s Board meeting resolved on March 6, 2024 to distribute a cash dividend of NT$1.5 per common share from the 2023 earnings, with a total dividend of $373,477 thousand.

97

(II) Condensed statements of comprehensive income - IFRS (Consolidated)

Unit: NT$ Thousand (Loss per share expressed in NT$)

Year Item	Financial information for thepast five fiscalyears(Note 1)	Financial information for thepast five fiscalyears(Note 1)	Financial information for thepast five fiscalyears(Note 1)	Financial information for thepast five fiscalyears(Note 1)	Financial information for thepast five fiscalyears(Note 1)
	2019	2020	2021	2022	2023
Operatingincome	3,468,682	4,666,756	6,077,362	7,741,118	7,199,935
Grossprofit	612,402	943,086	1,409,380	2,098,625	1,836,369
Operatingincome	7,329	344,153	434,012	1,248,276	748,631
Non-operating income and expenses	367,188	286,388	744,086	(574,563)	(302,831)
Earnings Before Tax	374,517	630,541	1,178,098	673,713	445,800
Net income of current period from continuing operations	311,940	486,307	886,561	445,632	164,284
Loss from discontinued operations	-	-	-	-	-
Net profit (loss) for theperiod	311,940	486,307	886,561	445,632	164,284
Other comprehensive income for the period (net after tax)	(8,340)	3,185	4,332	3,820	(10,012)
Total comprehensive income for theyear	303,600	489,492	890,893	449,452	154,272
Net profit attributable to shareholders of the parent company	431,254	683,897	1,185,777	703,519	366,126
Net profit attributable to non- controlling interests	(119,314)	(197,590)	(299,216)	(257,887)	(201,842)
Total comprehensive income attributable to shareholders of theparent entity	423,056	687,082	1,190,109	707,339	356,114
Total comprehensive income attributable to non-controlling interests	(119,456)	(197,590)	(299,216)	(257,887)	(201,842)
Earningsper share	2.19	3.34	5.65	3.37	1.75

Note 1: The aforementioned financial information from 2019 to 2023 were audited and verified by a certified accountant.

98

(III) Condensed balance sheets - IFRS (parent company only)

Unit: NT$Thousand

Year Items	Year Items	2019	2020	2021	2022	2023
Current assets		1,561,615	1,809,099	3,506,849	2,668,405	1,954,288
Property, plant and equipment		1,369,968	2,746,203	3,178,465	4,762,328	7,862,213
Intangible assets		2,177	2,366	8,518	41,720	45,675
Other assets		1,980,152	3,035,145	4,849,712	5,604,176	4,707,095
Total assets		4,913,912	7,592,813	11,543,544	13,076,629	14,569,271
Current liabilities	Before distribution	1,157,150	2,013,853	1,635,143	2,442,523	2,869,836
	After distribution	1,409,864	2,392,924	2,117,520	3,047,426	3,243,313
Non-current	liabilities	766,540	2,040,362	4,807,874	6,087,186	6,576,293
Other liabilities
Total Liabilities	Before distribution	1,923,690	4,054,215	6,443,017	8,529,709	9,446,129
	After distribution	2,176,404	4,433,286	6,925,394	9,134,612	9,819,606
Capital		2,527,136	2,527,136	2,556,735	2,564,465	2,564,465
Capital surplus	Before distribution	322,777	439,898	1,315,828	1,251,681	1,439,959
	After distribution	-	198,709	1,074,639	1,203,289	1,439,959
Retained earnings	Before distribution	977,513	1,405,273	2,165,355	2,499,245	2,291,561
	After distribution	724,799	1,164,084	1,924,166	1,942,734	1,918,084
Other equity	interests	(1,872)	889	4,032	10,508	1,641
Treasurystock		(835,332)	(834,598)	(941,423)	(1,778,979)	(1,174,484)
Total Equity	Before distribution	2,990,222	3,538,598	5,100,527	4,546,920	5,123,142
	After distribution	2,737,508	3,056,220	4,618,150	3,942,017	4,749,665

Note 1: The aforementioned financial information from 2019 to 2023 were audited and verified by a certified accountant.

Note 2. The Company’s Board meeting resolved on March 6, 2024 to distribute a cash dividend of NT$1.5 per common share from the 2023 earnings, with a total dividend of $373,477 thousand.

99

(IV) Condensed statements of comprehensive income - IFRS (parent company only)

Unit: NT$ Thousand

(Loss per share expressed in NT$)

Year Items	2019	2020	2021	2022	2023
Operatingincome	1,658,131	2,175,018	2,773,339	3,887,648	3,985,541
Grossprofit	513,182	851,193	1,319,187	2,091,069	1,662,977
Operatingincome	234,693	539,949	738,136	1,661,579	1,130,248
Non-operating income and expenses	230,133	206,941	624,859	(766,410)	(517,953)
Netprofit(loss)before tax	464,826	746,890	1,362,995	895,169	612,295
Net profit from continuing operations	431,254	683,897	1,185,777	703,519	366,126
Profit or loss from discontinued operations	-	-	-
Netprofit(loss)for theperiod	431,254	683,897	1,185,777	703,519	366,126
Other Comprehensive Profit or Loss	(8,198)	3,185	4,332	3,820	(10,012)
Total comprehensive income for theyear	423,056	687,082	1,190,109	707,339	356,114

Note: The aforementioned financial information was audited and verified by a certified accountant.

(V) Names and opinions of auditors for the past five years

Year of Certifying	Certifying CPA	Audit Opinions
2019	Tien-I Li,Ya-Hui Cheng	An unqualified opinion
2020	Tien-I Li,Ya-Hui Cheng	An unqualified opinion
2021	Tien-I Li,Ya-Hui Cheng	An unqualified opinion
2022	Ya-Hui Cheng,Chien-Yu Liu	An unqualified opinion
2023	Ya-Hui Cheng,Chien-Yu Liu	An unqualified opinion

100

II. Financial analysis for the most recent five fiscal years

(I) Financial analysis - IFRS (Consolidated)

Year (Note 1) Items to be analyzed(Note2)	Year (Note 1) Items to be analyzed(Note2)	2019	2020	2021	2022	2023
Financial position (%)	Debt to assetratio	45.49	62.33	69.78	75.22	75.87
	Long-term fund to property, plant and equipment ratio	259.09	173.06	235.25	185.48	130.77
Solvency (%)	Current ratio	131.46	66.33	132.44	84.59	68.54
	Quick ratio	114.02	57.67	123.27	74.45	56.49
	Timesinterest earned	24.63	20.09	12.72	4.79	2.52
Operating performance	Average collection turnover(times)	5.20	5.71	5.57	5.56	4.80
	Days sales outstanding	70	64	66	66	76
	Average inventory turnover (times)	8.74	16.53	14.86	13.85	9.89
	Average payment turnover (times)	9.42	9.71	10.68	12.61	12.17
	Average inventory turnover days	42	22	25	26	37
	Property, plant and equipment turnover(times)	2.76	2.00	1.68	1.54	0.94
	Total assets turnover (times)	0.72	0.63	0.48	0.46	0.37
Profitability	Return on assets(%)	6.77	6.93	7.67	3.46	2.06
	Return on equity (%)	10.95	14.88	21.32	9.58	3.46
	Pre-tax income to paid-in capital(%)	14.82	24.95	46.08	26.27	17.38
	Netprofit margin(%)	8.99	10.42	14.59	5.76	2.28
	Earningsper share(NTD)	2.19	3.34	5.65	3.37	1.75
Cash flow	Cash flow ratio(%)	39.09	(1.95)	(19.88)	20.24	9.47
	Cash flow adequacy ratio (%)	95.24	30.20	(3.74)	6.30	11.92
	Cash flow reinvestment ratio(%)	11.71	(7.59)	(16.95)	9.09	2.34
Leverage	Operatingleverage	112.19	3.37	4.44	2.54	3.93
	Financial leverage	(0.86)	1.11	1.30	1.17	1.64
Reasons for changes in the financial ratios in the past two years: 1. Financial structure (long-term capital to property, plant and equipment) and debt service (quick ratio, interest coverage ratio): mainly due to the working capital was used to expand the business of high-end products, as well as issuance of secured common corporate bonds to purchase fixed assets for better capacity, in addition to revitalization of assets to obtain medium- and long-term working capital. 2. Operating performance (inventory turnover ratio, average sales days, property, plant and equipment turnover ratio): mainly due to the impact of inventory adjustment in the supply chain, resulting in a decrease in revenue and an increase in inventory by the subsidiaries. In addition, fixed assets were purchased to increase capacity for expanding the business of high-end products. 3. Profitability (return on assets, return on equity, pre-tax income to paid-in capital ratio, net profit margin, earnings per share): Mainly due to the impact of inventory adjustment in the supply chain, resulting in a decrease in revenue and an increase in inventory by the subsidiaries. 4. Cash flow (cash flow ratio, cash flow adequacy ratio, cash flow reinvestment ratio): Mainly due to decrease in net cash outflows from operating activities in the current period compared with the previous period. 4. Leverage (operating and financial leverage): mainly due to the decrease in operating profit in the current period compared with the increase in the sameperiod lastyear.

• Note 1: The aforementioned financial information from 2019 to 2023 were audited and verified by a certified accountant.

101

Note 2: Calculation formula for items to be analyzed as shown below:

1. Capital structure

2. (1) Debt-to-asset ratio = Total liabilities / Total assets

3. (2) Long-term fund to property, plant and equipment ratio = (Shareholders’ equity + noncurrent liabilities) /Net property, plant and equipment

4. Solvency

5. (1) Current ratio = Current assets / Current liabilities

6. (2) Quick ratio = (Current assets – inventories – prepaid expenses) / Current liabilities

7. (3) Times interest earned = Earnings before interest and taxes / Interest expenses

8. Operating performance

9. (1) Receivables (including accounts receivable and notes receivable due to business operation) turnover = Net sales / the balance of average receivables of different periods (including accounts receivable and notes receivable due to business operation)

10. (2) Days sales outstanding = 365 / Average collection turnover

11. (3) Average inventory turnover = Operating costs / Average inventory

12. (4) Payables (including accounts payables and notes payable due to business operation) turnover = Cost of goods sold / the balance of average payables of different periods (including accounts payables and notes payable due to business operation)

13. (5) Average inventory turnover days = 365 / Average inventory turnover

14. (6) Property, plant and equipment turnover = Net sales / Average property, plant and equipment

15. (7) Total assets turnover = Net sales / total assets

16. Profitability

17. (1) Return on total assets = [Net income + Interest expenses x (1 – tax rate)] / Average total assets

18. (2) Return on equity attributable to shareholders of the parent = Net income attributable to shareholders of the parent / Average equity attributable to shareholders of the parent

19. (3) Net margin = Net income / Net sales

20. (4) Earnings per share = (Net income attributable to shareholders of the parent – preferred stock dividend) / Weighted average number of shares outstanding

21. Cash flow

22. (1) Cash flow ratio = Net cash provided by operating activities / Current Liabilities

23. (2) Cash flow adequacy ratio = Five-year sum of cash from operations / Five-year sum of capital expenditures, inventory additions, and cash dividend

24. (3) Cash flow reinvestment ratio = (Cash provided by operating activities – cash dividends) / (Gross property, plant and equipment + long-term investments + other noncurrent assets + working capital)

25. Leverage

26. (1) Operating leverage = (Net sales – variable cost) / Operating income

27. (2) Financial leverage = Operating income / (Operating income – interest expenses)

102

(II) Financial analysis - Adopt IFRS (parent-only)

Year (Note 1) Items to be analyzed(Note 2)	Year (Note 1) Items to be analyzed(Note 2)	2019	2020	2021	2022	2023
Financial position (%)	Debt to asset ratio	39.15	53.40	55.81	65.23	64.84
	Long-term capital to property, plant, and equipmentratio	274.22	203.15	311.74	223.3	148.81
Solvency (%)	Currentratio	134.95	89.83	214.47	109.25	68.1
	Quick ratio	120.59	81.13	205.43	100.08	60.17
	Times interest earned	33.34	27.92	25.37	10.76	4.77
Operating performance	Average collection turnover (times)	4.59	5.36	5.37	5.52	5.31
	Days sales outstanding	80	68	68	66	69
	Average inventory turnover (times)	8.61	10.65	13.17	15.72	18.71
	Average payment turnover (times)	14.07	12.92	15.27	18.87	20.5
	Average inventoryturnover days	42	34	28	23	20
	Property, plant and equipment turnover(times)	1.49	1.06	0.94	0.98	0.63
	Total assets turnover(times)	0.39	0.35	0.29	0.32	0.29
Profitability	Returnonassets (%)	10.48	11.29	12.86	6.31	3.59
	Returnonequity (%)	15.54	20.95	27.45	14.58	7.57
	Pre-tax income to paid-in capital (%)	18.39	29.55	53.31	34.91	23.88
	Netprofit margin(%)	26.01	31.44	42.76	18.1	9.19
	Earningsper share(NTD)	2.19	3.34	5.65	3.37	1.75
Cash flow	Cash flow ratio(%)	48.57	32.46	20.28	69.5	58.82
	Cash flow adequacyratio(%)	118.42	60.39	44.49	41.19	42.21
	Cash flow reinvestment ratio (%)	8.20	6.57	(0.46)	9.00	8.63
Leverage	Operatingleverage	3.74	2.36	2.48	1.75	2.52
	Financial leverage	1.07	1.05	1.08	1.06	1.17
Reasons for changes in the financial ratios in the past two years: 1. Financial structure (long-term capital to fixed assets) and debt service (current ratio, quick ratio, interest coverage ratio): mainly due to the increase in customer demand, the issuance of convertible bonds for the acquisition of fixed assets to increase production capacity, and the revitalization of assets to obtain medium- and long-term working capital. 2. Operating performance (property, plant, and equipment turnover): due to the purchase of fixed assets. 3. Profitability (return on assets, return on equity, pre-tax income to paid-in capital ratio, net profit margin, earnings per share): Mainly due to losses in non-operating investments. 4. Leverage (operating leverage): mainly due to the decrease in operating profit in the current period compared with the increase in the sameperiod lastyear.

• Note 1: The aforementioned financial information from 2019 to 2023 were audited and verified by a certified accountant.

103

Note 2: Calculation formula for items to be analyzed as shown below:

1. Capital structure

2. (1) Debt-to-asset ratio = Total liabilities / Total assets

3. (2) Long-term fund to property, plant and equipment ratio = (Shareholders’ equity + noncurrent liabilities) /Net property, plant and equipment

4. Solvency

5. (1) Current ratio = Current assets / Current liabilities

6. (2) Quick ratio = (Current assets – inventories – prepaid expenses) / Current liabilities

7. (3) Times interest earned = Earnings before interest and taxes / Interest expenses

8. Operating performance

9. (1) Receivables (including accounts receivable and notes receivable due to business operation) turnover = Net sales / the balance of average receivables of different periods (including accounts receivable and notes receivable due to business operation)

10. (2) Days sales outstanding = 365 / Average collection turnover

11. (3) Average inventory turnover = Operating costs / Average inventory

12. (4) Payables (including accounts payables and notes payable due to business operation) turnover = Cost of goods sold / the balance of average payables of different periods (including accounts payables and notes payable due to business operation)

13. (5) Average inventory turnover days = 365 / Average inventory turnover

14. (6) Property, plant and equipment turnover = Net sales / Average property, plant and equipment

15. (7) Total assets turnover = Net sales / total assets

16. Profitability

17. (1) Return on total assets = [Net income + Interest expenses x (1 – tax rate)] / Average total assets

18. (2) Return on equity attributable to shareholders of the parent = Net income attributable to shareholders of the parent / Average equity attributable to shareholders of the parent

19. (3) Net margin = Net income / Net sales

20. (4) Earnings per share = (Net income attributable to shareholders of the parent – preferred stock dividend) / Weighted average number of shares outstanding

21. Cash flow

22. (1) Cash flow ratio = Net cash provided by operating activities / Current Liabilities

23. (2) Cash flow adequacy ratio = Five-year sum of cash from operations / Five-year sum of capital expenditures, inventory additions, and cash dividend

24. (3) Cash flow reinvestment ratio = (Cash provided by operating activities – cash dividends) / (Gross property, plant and equipment + long-term investments + other noncurrent assets + working capital)

25. Leverage

26. (1) Operating leverage = (Net sales – variable cost) / Operating income

27. (2) Financial leverage = Operating income / (Operating income – interest expenses)

104

III. Audit Committee’s audit report of the Financial Statements for the most recent fiscal year

Taiwan Mask Corporation

Audit Committee’s Audit Report

We have reviewed the Company’s 2023 business report, financial statements and earnings distribution proposal prepared by the board of directors. The financial statements have been audited by CPA Ya-Hui Cheng and CPA Chien-Yu Liu of PricewaterhouseCoopers Taiwan, to which the firm has issued an independent auditor's report. The Audit Committee found no misstatement in the above, and hereby presents this report in accordance with Article 14-4 of the Securities and Exchange Act and Article 219 of the Company Act.

For

The 2023 Annual General Meeting

==> picture [96 x 92] intentionally omitted <==

Taiwan Mask Corporation

==> picture [60 x 71] intentionally omitted <==

Audit Committee convener: WANG, WEI-CHEN

March 6, 2024

105

Taiwan Mask Corporation

Consolidated Financial Statements Declaration

The companies that are required to be included in the affiliated companies consolidated financial statements as of and for the year ended on December 31, 2023, 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 of parent company and subsidiaries prepared in conformity with the International Accounting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the affiliated companies consolidated financial statements is included in the consolidated financial statements of the aforesaid parent company and subsidiaries. Consequently, do not prepare a separate set of consolidated financial statements of the affiliated companies.

Very truly yours

==> picture [96 x 93] intentionally omitted <==

Company Name: Taiwan Mask Corporation Person in Charge: Sean Chen

March 6, 2024

106

• IV. Parent-only financial statements for the most recent fiscal year (2023) audited and attested by certified public accountants: Please refer to Attachment 1.

• V. Consolidated financial statements for the most recent fiscal year (2023) audited and attested by certified public accountants: Please refer to Attachment 2.

• VI. If the company or its affiliates have experienced financial difficulties in the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report, the annual report shall explain how said difficulties will affect the company's financial situation: None.

107

Seven. Review and Analysis of Financial Position and Financial Performance and Risks

I. Financial position

• (I) Changes to liabilities and stockholders’ equity in the two most recent years

Unit: NT$ Thousand

			Unit: NT$Thousand	Unit: NT$Thousand
Year Items	2022	2023	Difference
			Amount	%
Current assets	5,903,882	5,910,895	7,013	0.12
Fixed assets	5,883,661	9,405,807	3,522,146	59.86
Other assets	6,105,363	5,607,357	(498,006)	(8.16)
Total assets	17,892,906	20,924,059	3,031,153	16.94
Current liabilities	6,979,765	8,623,904	1,644,139	23.56
Non-current liabilities	6,478,934	7,250,839	771,905	11.91
Total Liabilities	13,458,699	15,874,743	2,416,044	17.95
Capital	2,564,465	2,564,465	0	0.00
Capital surplus	1,251,681	1,439,959	188,278	15.04
Retained earnings	2,499,245	2,291,561	(207,684)	(8.31)
Other equity interests	10,508	1,641	(8,867)	(84.38)
Treasurystock	(1,778,979)	(1,174,484)	604,495	(33.98)
Non-controlling Interests	(112,713)	(73,826)	38,887	(34.50)
Total Equity	4,434,207	5,049,316	615,109	13.87

• (II) Analysis of changes in proportion

• Fixed assets increased by 59.86% due to the purchase of machinery and equipment and the construction of a clean room.

• Current liabilities increased by 23.56% due to the increase in bank borrowings.

• Other equities decreased by 84.38%, which was due to the decrease in the exchange difference arising on translation of foreign operations.

• Treasury stocks decreased by 33.98%, due to the transfer of treasury stocks to employees in the current period.

• Non-controlling interests decreased by 34.50% due to the increase in investment in the capital increase of a subsidiary.

108

II. Financial performance

(I) Financial performance comparison analysis table

inancial performance (I) Financial performance comparison analysis table	inancial performance (I) Financial performance comparison analysis table	inancial performance (I) Financial performance comparison analysis table	inancial performance (I) Financial performance comparison analysis table	inancial performance (I) Financial performance comparison analysis table
Unit: NT$ Thousand Year Item 2022 2023 Amount increase (decrease) Change in proportion (%) Operatingincome 7,741,118 7,199,935 (541,183) (6.99) Operating costs 5,642,493 5,363,566 (278,927) (4.94) Gross profit 2,098,625 1,836,369 (262,256) (12.50) OperatingExpenses 850,349 1,087,738 237,389 27.92 Operating profit(loss) 1,248,276 748,631 (499,645) (40.03) Non-operatingincomeand expenses (574,563) (302,831) 271,732 (47.29) Net income (loss) of this period from continuing operations 445,632 164,284 (281,348) (63.13) Other consolidated profit and loss after taxes 3,820 (10,012) (13,832) (362.09) Total comprehensive income for the year 449,452 154,272 (295,180) (65.68)
Year	2022	2023	Amount i	Change in i
Item			ncrease (decrease)	proporton (%)
Operatingincome	7,741,118	7,199,935	(541,183)	(6.99)
Operating costs	5,642,493	5,363,566	(278,927)	(4.94)
Gross profit	2,098,625	1,836,369	(262,256)	(12.50)
OperatingExpenses	850,349	1,087,738	237,389	27.92
Operating profit(loss)	1,248,276	748,631	(499,645)	(40.03)
Non-operatingincomeand expenses	(574,563)	(302,831)	271,732	(47.29)
Net income (loss) of this period from continuing operations	445,632	164,284	(281,348)	(63.13)
Other consolidated profit and loss after taxes	3,820	(10,012)	(13,832)	(362.09)
Total comprehensive income for the year	449,452	154,272	(295,180)	(65.68)

• (II) Analysis of changes in proportion

• The operating expenses increased by 27.92% and the net operating income decreased by 40.03%, due to the investment in research and development of new processes, development of new products, and the merger of Moment Semiconductor and Pilot in the current period.

• Non-operating income and expenses decreased by 47.29%, mainly due to the decrease in valuation of financial assets.

• The net profit of continuing operations for the current period decreased by 63.13%, and the total comprehensive income of the current period decreased by 65.68%, mainly due to the decrease in the profit of the main business.

• Other comprehensive income for the current period decreased by 362.09%, mainly due to the decrease in exchange differences from the financial statements of foreign operating organizations for the current period.

• (III) Expected sales volume and its basis, potential effects to future company finance and operations and contingency plan

• In response to future trends of IC manufacturing technology advancement, current matured technology facilities owned by the Company are not sufficient to meet the demands of IC design companies. Thus, there are plans to purchase photomask equipment with high-level technology to satisfy customer demands for high-level manufacturing, and to elevate the Company’s overall competitiveness. Estimated photomask sales volume in 2024 is expected to increase by 20% from 2023. The Company is actively reducing cost and various expenses, continues to research and develop and upgrade its technology to improve operations and increase profits.

109

III. Cash flow

• (I) Analysis of the changes in the cash flow in the past two years

Year	2022	2023	Ratio increase
Item			(decrease)
Cash flow ratio	20.24	9.47	(10.77)pps
Cash flow adequacy ratio	6.30	11.92	5.62pps
Cash flow reinvestment ratio	9.09	2.34	(6.75)pps

• (II) Explanation of changes in the ratio

Cash flow ratio, cash flow adequacy ratio, and cash flow reinvestment ratio: Mainly due to

decrease in net cash inflows from operating activities in the current period compared with the previous period.

• (III) Improvement plan for liquidity shortfall

The Company does not observe signs of insufficient liquidity, thus, not applicable.

• (IV) Cash flow analysis for the coming year

				Unit: NT$Thousand	Unit: NT$Thousand
Opening Balance (1)	Estimated cash flow from operating activities(2)	Estimated cash flow from investment and financing activities(3)	Estimated cash balance (shortfall) amount (1)＋(2)＋(3)	Remedy for insufficient cash
				investment plan	Financing plan
1,364,106	1,361,196	(3,575,193)	(849,891)	-	6,000,000

1. Operating activities: Mainly estimated cash generated from sales and added depreciation with no cash flow.

2. Investment activities: It is expected that there will be purchases of machinery and equipment, therefore, investment activities will have situations of net cash used.

IV. Effects of major capital expenditures on finance and operation in the most recent fiscal year

• (I) Usage situations of major capital expenditures and funds transactions

Unit: NT$ Thousand

		Unit: NT$ Thousand	Unit: NT$ Thousand
Project item	Actual or planned source of capital	Actual usage of funds
		2022	2023
1. Buildings and structures	Operating profit, issuance of convertible corporate bonds and medium and long-term borrowings.	2,911,204	3,179,581
2. Exposure equipment
3. Test system
4. Measurement equipment
5. Process equipment
6. Repair system
7. Environmental equipment

110

(II) Expected possible benefits generated

1. Estimated to increase production and sales volume, value and gross profit

				Unit: Pieces;NT$ Thousand	Unit: Pieces;NT$ Thousand	Unit: Pieces;NT$ Thousand
Year	Items	Unit	Production volume	Sales volume	Sales value	Gross profit
2024	Photomask	Pieces	11,000	11,000	1,320,000	660,000
2025	Photomask	Pieces	12,000	12,000	1,560,000	780,000

2. Description of other benefits

• (1) Continue to invest and develop unique and large-size photomasks, improve yield rate and increase market share. In response to the domestic industrial development, develop the technology required for finer fabrication, and expand production capacity to support the development of more automation industries.

• (2) The photomask needed in submicron requires precision equipment to work with, the equipment purchased can inspect for defects that are smaller, so as to provide better quality photomask to downstream wafer plants, further improving the yield rate of wafer manufacturing.

• (3) Since the opening of the Company’s plant, we have placed environmental protection as first priority. The environmental equipment used are the most advanced wastewater and air emissions treatment systems globally, wastewater and air emissions are released within standards.

V. The Company’s reinvestment policy for the most recent fiscal year, the main reasons for the generated profits/losses, the plan for improving re-investment profitability and investment plans for the coming year

The Company’s re-investment are strategic investments, recognized investment losses based on the equity method of the 2023 consolidated financial statement is at NT$85,789 thousand. Reasons for the loss and improvement plan are as shown below:

Investee	Profit (loss) of the investee for the current period	Investment profit (loss) recognized for the current period	Reasons	Improvement plan
Advagene Biopharma Co., Ltd.	(91,817)	(27,854)	Currently at the research and development stage, and continue to invest in research and development expenditures, resulting in net losses.	The Company continuously focuses on the R&D of intranasal vaccine and various mucous membrane immune therapy treatment, and not ruling out the possibility of licensing the products to multinational pharmaceutical companies in a mutually beneficial win-win model and establishing long- termpartnerships with them.
Weida Hi- Tech Co., Ltd.	(210,648)	(57,935)	The semiconductor supply chain increased inventory. In order to digest the inventory, the revenue declined.	Enhance inventory closeout, and develop touch applications for All-in-Ones, laptops, and industrial control application panels to increase revenue.

111

VI. Analysis and assessment of risks

(I) Impact of interest rate, exchange rate fluctuation and inflation on the Company’s profit and loss and the future responsive measures for the most recent fiscal year and until annual report publication date.

Items	Impact to the Company’s profit and loss	Future countermeasures
Changes in interest rate	Interest rate increases or decreased by 0.25% / Net income after tax increases or decreases 2023 NT$19,544 thousand	The interest rate risk of Taiwan Mask mainly comes from financial liabilities, and most of the long-term financial liabilities are with fixed interest rates. To reduce risks, the Company will make good use of various financial instruments and lock in favorable fixed interest rates depending on market conditions, to reduce the risks of interest rate fluctuations.
Exchange rate fluctuation	Exchange rate fluctuation 1% / Increase in gains (losses) 2023 NT$8,983 thousand	Adopt natural hedging measures as the countermeasure.
Inflation	No impacts	Inflation situations in the most recent fiscal year have limited impacts to the Company’s gains or losses, continue to take note of changes in domestic and overseas economies.

(II) In the two most recent fiscal years and until the publication date of the annual report, the policy, main reason for profit or loss, and future countermeasures of high-risk investments, high-leverage investments, loans to other parties, endorsements/guarantees, and derivatives transactions.

1. In the most recent fiscal year and until the publication date of the annual report, high-risk investments, high-leverage investments and derivatives transactions: None.

2. Loans to Others

. Loans to Others
			Unit: NT$Thousand
Company that lent funds	Borrowing party	Type	December 31, 2023	March 31, 2024
Youe Chung Capital Corporation	Aptos Technology INC.	Working Capital Turnover	270,000	310,000
	Xsense Technology Corporation (B.V.I.) Taiwan Branch	Working Capital Turnover	270,000	270,000
	Innova Vision INC.	Working Capital Turnover	90,000	150,000
	Moment Semiconductor, Inc.	Working Capital Turnover	30,000	0
Miracle Technology CO.,LTD.	Aptos Technology INC.	Working Capital Turnover	170,000	170,000
Pilot Battery Co., Ltd.	Xsense Technology Corporation (B.V.I.) Taiwan Branch	Working Capital Turnover	50,000	50,000
Miko-China Enterprise (Shanghai) Co.,Ltd.	Sichuan Miracle Power Technology Co.,Ltd.	Working Capital Turnover	0	44,080

112

3. Endorsement and guarantee

			Unit:NT$Thousand
Endorser/guarantor	Party being endorsed/guaranteed	December 31, 2023	March 31, 2024
Taiwan Mask Corporation	Miracle Technology CO.,LTD.	214,935	128,000
Miko-China Enterprise (Shanghai) Co.,Ltd.	Miracle Technology CO.,LTD.	224,165	224,808
Miracle Technology CO., LTD.	Xsense Technology Corporation (B.V.I.) Taiwan Branch	150,000	150,000
Miracle Technology CO., LTD.	Aptos Technology INC.	20,000	20,000
Pilot Battery Co.,Ltd.	ADL Energy Corp	30,000	0
Pilot Battery Co., Ltd.	Youe Chung Capital Corporation	0	100,000

• (III) Research and development programs in the future and the expenditures expected

• To elevate competitiveness and to satisfy demands from customers and markets, it is expected to continue to invest in human resources and expenditures to research and develop high level photomask products, advanced manufacturing processes and so on technology development in the future, to maintain leading position in technology and product yield rate. In 2024, the expected research and development expenses will be approximately NT$550 million.

• (IV) Effect on the Company’s financial operations of important policies adopted and changes in the legal environment at home and abroad, and countermeasures The Company abides by national policies and laws, related units monitor closely to any changes in major policies and laws and cooperate to adjust the company’s internal system and operations activities to ensure smooth operations of the company.

• (V) Effect on the Company’s financial operations of developments in science and technology as well as industrial change, and measures to be taken in response

• Semiconductor technology is constantly developing towards the precision manufacturing process, it will increase demands for high level photomasks relatively. The Company continues to expand its production capacity, purchase high level manufacturing machinery, and currently the company is in sound financial position, which is sufficient to respond to the company’s future technology development demand. Impacts to the company’s finance and business from technology changes and industry changes are limited.

• Information security risk assessment

  • (1) Cybersecurity risk management framework

    • The Company’s dedicated information security unit “IT Management department” is responsible for the Company’s information security governance, planning, supervision and execution, to build a total information security defense capability and good employee awareness of information security.

    • Hold information security management review meeting every year (for information security management system, information security policy) → Held in August 2023

    • The head of the information unit reports the implementation status of the information security management system in the Company's monthly meetings.

  • (2) Cybersecurity policy and specific management program

    • The Company’s information security management policy, “Provide a reliable information security operating environment and maintain the legal use of information systems and data to ensure the continuous and normal operation of company services and achieve the Company’s information security management goals.”

113

• In order to effectively implement the information security management system, our specific practices are as follows:

• A. Establish procedures for information processing system management to protect computer and internet security, implementing information security management through strengthening the concept, preventive measures, conduct records, active precaution, regular audits and so on procedures.

• B. Formulate information security events notification management procedures assigning related personnel with necessary responsibility to facilitate rapid handling of information security incidents.

• C. Establish information security facilities and systems change management notification mechanisms to prevent leaks in system security.

• D. Handle prudently and protect personal data in accordance with the provisions as stipulated in “Computer-Processed Personal Data Protection Law.”

• E. Establish backup facility, rigorous backup necessary data for 321 principle, software and backup procedures, to prepare for disaster or malfunction in storage media, enabling rapid recovery back to normal operation. However, it is not possible to guarantee a complete avoidance of illegal intrusion by third parties who use internet virus attack, serious internet attacks may result in system problems interrupting the company’s operations or prying of confidential information. These attacks may result in compensations to customers of the losses incurred from delays or interruptions from the company, or the need to bear expenses for rebuilding system security protection.

• F. Improve employees’ information security awareness and regularly conduct social engineering drills and information security education and training sessions.

• G. Develop risk assessment operations and take appropriate corrective and preventive measures for high-risk services to educe the probability or impact of risks.

• H. Hold management review meetings every year to review the operation of the information security management system and the related improvements, maintenance and operation of documents at all levels.

• I. Establish access control and management procedures, and standardize access control requirements for company systems, networks, and data, including configuration and management of employee accounts, passwords, and access authority to prevent information security incidents of unauthorized access to information assets.

• J. Formulate remote work methods, and standardize the requirements of remote work environment, connection and computer, so that employees can comply with the authorization and requirements of the Company's information security management system in the remote work scenario.

• K. Establish physical security control measures to regulate the Company's access requirements, including regulations on the devices carried by personnel and regulations on visitor access, to avoid information security incidents due to the leakage of internal sensitive information.

• We have joined the Taiwan Computer Emergency Response Team/Coordination Center (TWCERT/CC) in 2022 to process information.

• (3) Resources committed to cybersecurity management.

• Number of information security personnel (14 representatives from each department and 20 from the Information Management Department): 34

• Information security management review meeting every year → Held in August 2023 - Information security monthly meeting

• (4) Adopt the information security management system standards, and obtain third-party verification.

114

     - We obtained the ISO/IEC 27001:2013 Information security management systems verification in October 2020, and completed the 2nd annual audit verification for the ISO 27001 at the end of 2022.

  - (5) Information security risk events

     - The Company has not discovered any information security risk events in 2023.

• (VI) Effect on the Company’s crisis management from changes in the Company’s corporate image and measures to be taken in response: None.

• (VII) Expected benefits and possible risks associated with any merger and acquisitions, and mitigation measures being or to be taken: None.

• (VIII) Expected benefits and possible risks associated with any plant expansion, and mitigation measures being or to be taken: None.

• (IX) Risks associated with any consolidation of sales or purchasing operations, and mitigation measures being or to be taken:

• In response to frequent changes to market demands, supply aspects need to have flexibility. Various major materials required by the Company’s operations are steadily supplied by multiple suppliers. There have been plans each year in assessing new suppliers. The company plans to collaborate actively with suppliers for the supply of raw materials and equipment required by operations in the coming one year.

• Major sales customers of the Company are well-known companies, proportion of revenues from customers are diverted across major industries, there are no risks of concentration of sales.

• (X) Effect upon and risk to the Company in the event a major quantity of shares belonging to a director or shareholder holding greater than a 10% stake in the Company has been transferred or has otherwise changed hands, and mitigation measures being or to be taken: The Company’s major shareholders are fairly supportive of the company’s operations and management levels and submit timely reports to the Board of Directors and on shareholding situations of the top 10% major shareholders in accordance with the Securities and Exchange Act. There have been no situations of transfer of major quantities of shares or changed hands in the most recent fiscal year and up to the annual report publication date, thus, it has no effects on the Company.

• (XI) Effect upon and risk to Company associated with any change in governance personnel or top management, and mitigation measures being or to be taken: None.

• (XII) Litigation or non-litigation matters, list major litigations, non-litigation or administrative litigation matters where a court’s decision has been made or action is still pending of the company and company directors, supervisors, president, the de facto responsible persons, shareholders with over 10% shareholding, where the results may have a significant impact on shareholders’ rights and interests or prices of securities, shall disclose facts of disputes, price or claim value, litigation start date, major parties of the litigation and handling situation up to publication date of the annual report: None.

(XIII) Other important risks, and countermeasures being or to be taken: None.

VII. Other important matters: None.

115

Eight. Special Items to be Included

I. Information of affiliated companies

(I) Organizational chart of affiliated companies

December 31, 2023

==> picture [722 x 145] intentionally omitted <==

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

Taiwan Mask Corporation
Youe Chung Capital
Corporation Miracle Technology CO., LTD. 100% International Holding Inc. Sunny Lake Park 100% Innova Vision Inc. 91.53% ONE TEST SYSTEMS 100% Pilot Battery Co., Ltd. 20.00%
100%
Aptos Technology INC. 100% Innova Vision INC.0.19% DIGITAL-CAN TECH. CO., LTD.57.39% Xsense Technology Corporation 100% Corporation 53.00%Xsense Technology Pilot Battery Co., Ltd. 38.89% Moment Semiconductor, Inc. 53.33% Enterprise(Shanghai) Co., Miracle International Ltd. 100% Jing Hao Investment Co., Ltd.100%
New Sunrise Limited100% Innova Technology 100% Innova Vision (B.V.I) Inc 100% ipro Vision Inc 52.03% ADL Energy Corp100% Sichuan Miracle Power Technology Co., Ltd. 20.83% (Shanghai) Co., Ltd.100%Miko-China Enterprise MIKO TECHNOLOGY CO., LTD.100%
iPro Vision Inc.47.97% Aptos Global Holding Corp. 100% Sichuan Miracle Power Technology Co., Ltd. 79.17%
----- End of picture text -----

116

(II) Performance of affiliated companies

(II) Performance of affiliated companies
		As of March 31, 2023 Unit: NT$ Thousand
Name of entity	Amount of Capital	Total assets	Total Liabilities	Total Equity	Operating income	Operating profit	Profit and Loss of the Period (after taxes)
Youe ChungCapital Corporation	5,348,776	6,945,111	3,417,943	3,527,168	-	(79,082)	(810,367)
SunnyLake Park International Holdings,Inc	103,045	5,683	-	5,683	-	-	(64)
Miracle TechnologyCO.,LTD.	229,550	1,188,217	752,231	435,986	720,108	(33,837)	17,169
JingHao Investment Co.,Ltd.	258,609	401,797	80,127	321,670	-	(150)	43,005
Miko TechnologyCo.,Ltd	37	6,812	93	6,719	-	(55)	(20)
Miko-China Enterprise(Shanghai)Co.,Ltd.	3,283	405,614	13,483	392,131	116,852	64,694	54,528
Miracle International Enterprise(Shanghai)Co.,Ltd.	10,215	300,675	197,908	102,767	707,373	15,115	11,025
Sichuan Miracle Power TechnologyCo.,Ltd.	54,249	72,173	17,180	54,993	116,242	(3,100)	(2,723)
Aptos TechnologyINC.	603,560	750,007	1,220,081	(470,074)	346,496	(279,702)	(274,014)
ADL EnergyCorp	119,845	162,979	94,669	68,310	190,372	(6,820)	20,396
New Sunrise Limited	-	-	-	-	-	-	-
Aptos Global HoldingCorp.	29,795	-	-	-	-	-	-
Innova Vision INC.	502,000	1,003,675	945,836	57,839	114,854	(155,877)	(178,674)
iPro Vision Inc.	JPY 80,000,000	JPY 169,076,153	JPY 182,380,467	(JPY 13,304,314)	JPY 176,350,455	(JPY 3,181,380)	(JPY 11,710,611)
Innova Vision(B.V.I.)Inc	US$1,000,000.00	US$5,633.41	US$45,145.34	(US$39,511.93)	-	-	(US$39,954.97)
Innova Technology	30,000	2,760	6,156	(3,396)	47	(60)	(58)
Xsense TechnologyCorporation	-	6,250	2,877	3,373	-	(90)	(72)
Digital-Can Tech. Co.,Ltd.	126,880	152,974	95,441	57,533	182,732	(3,475)	(4,253)
Xsense TechnologyCorporation(B.V.I.)Taiwan Branch	230,000	615,655	833,431	(217,776)	663,280	21,849	10,768
Pilot BatteryCo.,Ltd.	180,000	597,521	204,567	392,954	38,924	(58,175)	(58,757)
Moment Semiconductor,Inc.	75,000	164,065	152,432	11,633	363,526	(23,669)	(24,327)
One Test Systems	28,338	9	49	(40)	0	(5)	5,823

Note: Pilot and Moment Semiconductor were merged into the Group in March 2023, and One Test Systems was merged into the Group in May 2023.

117

(III) Information on the directors, supervisors, general manager of each affiliated company

March 31, 2024. Unit: shares; NT$; %

Name of entity	Job title	Name or Representative	Shareholding	Shareholding
			Number of shares (capital contributions)	Proportion
Youe Chung Capital Corporation	Chairman	Taiwan Mask Corporation, Representative: Eve Yang	534,877,568	100%
	Director	Taiwan Mask Corporation, Representative: Shih- Hsien Chao
	Director	Taiwan Mask Corporation, Representative: Chang-Ji Hsu
Sunnylake Park International Holdings,Inc.	Director	Representative, Taiwan Mask Corporation: Sean Chen	US$3,120,000	100%
Miracle Technology CO., LTD.	Chairman	Taiwan Mask Corporation, Representative: Chang-Ji Hsu	22,955,033	100%
	Director	Taiwan Mask Corporation, Representative: Ming-ChengLiang
	Director	Taiwan Mask Corporation, Representative: Yung- Ming Chao
	Supervisor	Taiwan Mask Corporation, Representative: Ya- Hui Huang
Jing Hao Investment Co.,Ltd.	Chairman	Miracle Technology CO., LTD., Representative: Yung-MingChao	25,860,907	100%
Miko Technology Co.,Ltd	Chairman	Representative, Jingjing Investment Co., Ltd.: Shih-YangHuang	HKD 10,000	100%
Miko-China Enterprise (Shanghai) Co., Ltd.	Legal representative	Jingjing Investment Co., Ltd., Representative: Yung-MingChao	USD102,000	100%
	Supervisor	Jingjing Investment Co., Ltd., Representative: Pei-Chen Chen
Miracle International Enterprise(Shanghai) Co., Ltd.	Legal representative	Miracle Technology CO., LTD., Representative: Yung-Ming Chao	USD300,000	100%
	Supervisor	Representative, Miracle Technology Co., Ltd. Pei-Chen Chen
Sichuan Miracle Power Technology Co., Ltd.	Legal representative	Miko-China Enterprise (Shanghai) Co., Ltd. Representative: Yung-MingChao	CNY 12,000,000	79.17%
	Supervisor	Representative, Miko-China Enterprise (Shanghai)Co.,Ltd.: Pei-Chen Chen
Aptos Technology Inc.	Chairman	Youe Chung Capital Corporation, Representative: Ming-ChengLiang	28,481,161	47.19%
	Director	Youe Chung Capital Corporation, Representative: LidonChen
	Director	Youe Chung Capital Corporation, Representative: Chang-Ji Hsu
	Director	Youe Chung Capital Corporation, Representative: Nester Huang
	Director	Youe Chung Capital Corporation, Representative: Chih-MingChen
	Supervisor	Yu-Chen Lai	215,000	0.36%
	Supervisor	Pi-Chia Hsiao	30,000	0.05%
ADL Energy Corp	Chairman	Representative, Pilot Battery Co., Ltd.: Chien-Li Cheng	11,984,526	100%
	Director	Representative, Pilot Battery Co.,Ltd.: Hung- Sheng Chang
	Director	Representative, Pilot Battery Co.,Ltd.: Hao- ChungKe
	Supervisor	Yi-Hsien Lin
Aptos Global HoldingCorp.	Director	ADL Energy Corp	USD1,000,000	100.00%
New Sunrise Limited	Director	Aptos TechnologyINC.	Note	100.00%

118

Name of entity	Job title	Name or Representative	Shareholding	Shareholding
			Number of shares (capital contributions)	Proportion
Innova Vision INC.	Chairman	Youe Chung Capital Corporation, Representative: Mei-Hui Li	94,370	0.19%
	Director	Youe Chung Capital Corporation, Representative: Yu-Shian Tsai
	Director	Youe Chung Capital Corporation, Representative: Jui-JungHuang
	Director	Youe Chung Capital Corporation, Representative: Yao-Lun Chen
	Director	Youe Chung Capital Corporation, Representative: Lung-ShengYu
	Supervisor	Jing-YingHuang	0	0.00%
Innova Technology	Director	Innova Vision representative: Mei-Hui Li	3,000,000	100%
Innova Vision Inc. (B. V. I.)Inc.	Director	InnovaVision representative: ParksonChen	USD 1,000,000	100%
	Director	InnovaVision representative:Sheng-ChungKuo
iPro Vision Inc.	Director	Mei-Hui Li	JPY 38,376,000	47.97%
	Director	Wan-Chun Yen
	Director	Rui-LongHuang
	Supervisor	Yao-LunChen	0	0.00%
Xsense Technology Corporation	Director	Sean Chen	1	100%
Digital-Can Tech. Co., Ltd.	Chairman	Youe Chung Capital Corporation, Representative: Nester Huang	7,281,250	57.39%
	Director	Youe Chung Capital Corporation, Representative: Lidon Chen
	Director	Youe Chung Capital Corporation, Representative: Eve Yang
	Director	Bing-MingDu	2,000,000	15.76%
	Director	Ming-Chih Chou	1,500,000	11.82%
	Supervisor	Shih-Hsien Chao	0	0.00%
Pilot Battery Co., Ltd.	Chairman	Representative, Youe Chung Capital Corporation: Chien-LiCheng	7,000,000	38.89%
	Director	Youe Chung Capital Corporation, Representative: Lidon Chen
	Director	Representative of Youe Chung Capital Corporation: Hao-Lin Chang
	Supervisor	Shih-Hsien Chao	0	0.00%
Moment Semiconductor, Inc.	Chairman	Representative of Youe Chung Capital Corporation: Chih-MingChen	4,000,000	53.33%
	Director	Youe Chung Capital Corporation, Representative: Lidon Chen
	Director	Representative of Youe Chung Capital Corporation: De-HongYang
	Supervisor	Jing-YingHuang	0	0.00%
One Test Systems	Director	Representative, Taiwan Photomask Co., Ltd.: Chih-MingChen	US$940,000	100%

Note: New Sunrise Limited was established in 2015, Aptos Technology has not invested at that time.

119

(IV) Basic information on affiliates

			December 31,	2023,Unit: NT$Thousand
Name of entity	Date of incorporation	Address	Paid-up capital	Main business activities
Youe Chung Capital Corporation	March 26, 2004	4F., No. 38, Shengli 2nd Road, Neighborhood 27, Shixing Vil., Zhubei City,Hsinchu County	NTD5,348,776	Investment
SunnyLake Park International Holdings,Inc	March 27, 1990	Citco Building,Wickhams Cay, P.O. Box 662, Road Town,Tortola, British Virgin Islands	USD3,120	Investment
Miracle Technology CO., LTD.	November 22, 1993	4F., No. 38, Shengli 2nd Road, Neighborhood 27, Shixing Vil., Zhubei City, Hsinchu County	NTD229,550	Electronics components manufacturing, electronics materials and precision equipment distribution and product design business
Jing Hao Investment Co., Ltd.	October 13, 2006	4F., No. 38, Shengli 2nd Road, Neighborhood 27, Shixing Vil., Zhubei City,Hsinchu County	NTD258,609	Investment
Miko Technology Co.,Ltd	December 8, 1997	Room 1203, 12/F., Tung Wah Mansion,199-203 Hennessy Road, Wanchai, Hong Kong.	HK10	Electronics components manufacturing, electronics materials and precision equipment distribution and power component design
Miko-China Enterprise (Shanghai) Co., Ltd.	May 17, 2000	Room 301, Building #3, No. 1077, ZuChongZhi Road, ZhangJiang Hi-Tech Science Park, PuDong, Shanghai Zip: 201203	USD102	Electronics components manufacturing, electronics materials and precision equipment distribution and power component design
Miracle International Enterprise(Shanghai) Co., Ltd.	February 9, 2004	Room 204, Building #3, No. 1077, ZuChongZhi Road, ZhangJiang Hi-Tech Science Park, PuDong, Shanghai Zip: 201203	USD300	IC product design, production and sales
Sichuan Miracle Power Technology Co., Ltd.	June 6, 2017	No. 598, Yulong Rd, Chuanshan District, Suining City, Sichuan Province, PR China Innovative Innovation Incubation Center,5F,No. 5001-5002	CNY12,000	IC product design, production and sales
Aptos Technology INC.	March 10, 2006	Hsinchu Science Park, 1st Floor, No. 21, Kebei 1st Road, Zhunan Township, Miaoli County	NTD603,560	Electronics components
ADL Energy Corp	May 29, 2007	4F., No. 38, Shengli 2nd Road, Zhubei City,Hsinchu County	NTD119,845	Electronics components
New Sunrise Limited	December 10, 2015	Offshore Chambers, P.O. Box 217, Apia,Samoa	(Note 1)	Investment
Aptos Global Holding Corp.	August 2, 2000	Second Floor, Capital City, Independence Avenue, P.O. Box 1008, Vicotria,Seychelles	USD1,000	Investment
Innova Vision INC.	January 21, 1990	2nd Floor, No. 20, Zhanye 1st Road, Hsinchu City, Hsinchu Science Park	NTD502,000	Medical equipment manufacturing, retail and wholesale Wholesale
Innova Technology	May 29, 2003	No. 231-1, Wende Road, Qionglin, Hsinchu County	NTD30,000	Medical equipment retail and wholesale
iPro Vision Inc.	May 16, 2001	2-9-2 HigashiNihonbashi Chuo- ku,Tokyo,Japan	JPY80,000	Medical equipment retail and wholesale
Innova Vision(B.V.I.)Inc	August 10, 1998	OMC Chambers,Wickhams Cay1, Road Town,Tortola,British Virgin Islands.	USD1,000	Investment
Xsense Technology Corporation	October 13, 2014	OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.	(Note 2)	Investment
Xsense Technology Corporation (B.V.I.) Taiwan Branch	August 20, 2020	Hsinchu Science Park, 3rd Floor, No. 21, Kebei 1st Road, Zhunan Township, Miaoli County	NTD230,000	Precious metal coating
Digital-Can Tech. Co., Ltd.	September 17,2003	2nd Floor-1, No. 88, Zhouzi Street, Neihu District,Taipei City	NTD126,880	3D Printing and Plastic Mold Design 199

120

Name of entity	Date of incorporation	Address	Paid-up capital	Main business activities
Pilot Battery Co., Ltd.	September 18, 1979	No. 2 & 4, Ziqiang Rd., Longde Village, Suao Township, Yilan County	NTD180,000	Electronic parts and components and energy technical services
Moment Semiconductor, Inc.	November 14,2017	No. 388, Zhonghua Road, Sec. 1, East District,Hsinchu City	NTD75,000	Retail and wholesale of memory products
One Test Systems	December 14, 2018	Suite 102, Cannon Place, North Sound Road, George Town, Grand Cayman KYI-9006,Cayman Islands	USD940	Research, development and design of test equipment and related components

Note 1: New Sunrise Limited was established in 2015, Aptos Technology has not invested at that time.

Note 2: Xsense Technology Corporation conducted a capital decrease in kind in November 2022, and only one share was remained to be held 100% by You Zhuan Investment Co., Ltd.

(V) Consolidated Financial Statements

The companies that are required to be included in the affiliated companies’ consolidated financial statements are the same as those included in the consolidated financial statements of parent company and subsidiaries prepared in conformity with the International Accounting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the affiliated companies’ consolidated financial statements is included in the consolidated financial statements of the aforesaid parent company and subsidiaries. Thus, the Company only presents the declaration on the cover page of the consolidated financial report of parent company and subsidiaries, and will not prepare separate affiliated companies’ consolidated financial statements and its declaration (Please refer to this handbook Chapter “Six. Overview of Financial Status” and “IV. Latest financial report”).

(VI) Relationship report: Not applicable.

(VII) Information on the controlling and controlled entities presumably sharing the same shareholders: None.

121

II. Status of private placement of securities during the most recent fiscal year and up to the date of publication of the annual report: None.

III. Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:

Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:	Holding or disposal of shares in the Company by the Company’s subsidiaries during the most recent fiscal year and up to the date of publication of the annual report:
Unit: NT$Thousands;Thousand shares;%
Name of Subsidiary	Paid-up capital	Source of funds	The Company’s shareholding ratio	Date of acquisition or disposal	Number of shares and amount acquired (Note 1)	Number of shares and amount disposed (Note 1)	Investment income (loss)	Number of shares and amount held up to publication date of annual report	Status of creation of pledge	Endorsements/ guarantees of amount by parent company to subsidiary	Amount the Company lends to subsidiary
Youe Chung Capital Corporation	$5,348,776 thousand	Proprietary funds	100%	2023 and as of March 31, 2024	-	-	-	Number of shares 35,331 thousand shares Amount: NT$2,402,538 thousand	34,550 thousand shares	NT$128,000 thousand	None
Note 1: “Amount” refers to the actual amount acquired or disposed of. Note 2: Effects to the financial performance and financial situation of the company: Not applicable.

IV. Other supplementary information: None.

• V. Situations listed in Article 36, Paragraph 2, Subparagraph 2 of the Securities and Exchange Act, which might materially affect shareholders' equity or the price of the company’s securities, have occurred during the most recent fiscal year or during the current fiscal year up to the date of publication of the annual report, such situations shall be listed: None.

122

Taiwan Mask Corporation

==> picture [96 x 94] intentionally omitted <==

Chairman: Sean Chen

==> picture [47 x 47] intentionally omitted <==

Taiwan Mask Corporation Parent Only financial statements and independent auditor’s report

2023 and 2022 (Stock Code: 2338)

Company address: No. 11, Chuangxin 1st Road, Hsinchu County, Hsinchu Science Park Telephone: (03)563-4370

~1~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation

’ 2023 and 2022 Parent-Only Financial Statements and Independent Auditor s Report Table of Content

Items I. Cover II. Table of Contents III. Independent Auditors’ Report IV. Parent Only Balance Sheets V. Parent Only Statements of Comprehensive Income VI. Parent Only Statements of Changes in Equity VII. Parent Only Statements of Cash Flows VIII. Notes to the Parent Only Financial Statements (I) Company History (II) Date and procedures for passing the financial statement (III) Application of New and Revised International Financial Reporting Standards (IV) Summary of Significant Accounting Policies (V) Critical Accounting Judgments and Key Sources of Estimation and Uncertainty (VI) Summary of Significant Accounting Items (VII) Related Party Transactions

Page/No./Index 1 2 ~ 4 5 ~ 9 10 ~ 11 12 13 14 ~ 15 16 ~ 73 16 16 16 ~ 17 18 ~ 27 27 28 ~ 56 57 ~ 60

~2~

Taiwan Mask Corp. Control Security C

Page/No./Index

Items

	(VIII) Pledged Assets	60
	(IX) Significant Contingent Liabilities and Unrecognized Contract
	Commitments	60
	(X) Losses due to Major Disasters	61
	(XI) Major Events after Financial Statement Date	61
	(XII) Others	61 ~ 72
	(XIII) Supplementary Disclosure	73 ~ 73
	1. Information on significant transactions	73
	2. Information on investees	73
	3. Information on investments in Mainland China	73
	4. Information on Major Shareholders	73
	(XIV) Segment Information	73
IX.	Schedule of Significant Accounting Items
	Cash and Cash Equivalents Schedule	Schedule 1
	Accounts Receivable Schedule	Schedule 2
	Inventories Schedule	Schedule 3
	Financial assets schedule at fair value through profit and loss	Schedule 4
	Schedule of Investments Changes Accounted for Using Equity Method	Schedule 5
	Property, Plant and Equipment Cost Changes Schedule	Schedule 6
	Property, Plant and Equipment Accumulated Depreciation Changes Schedule	Schedule 7
	Right-of-Use Assets Schedule	Schedule 8
	Right-of-Use Assets Accumulated Depreciation Schedule	Schedule 9

~3~

Taiwan Mask Corp. Control Security C

Items Short-Term Borrowings Schedule Long-Term Borrowings Schedule Sales Income Schedule Operating Costs Schedule Manufacturing Expenses Schedule Operating Expenses Schedule Employee Benefits, Depreciation, Depletion and Amortization in the Current Period	Page/No./Index Schedule 10 Schedule 11 Schedule 12 Schedule 13 Schedule 14 Schedule 15 Schedule 16

~4~

Taiwan Mask Corp. Control Security C

Independent Auditors’ Report (113) Tsai-Sheng-Bao-Zi No. 23002831

To Taiwan Mask Corporation,

Opinions

We have audited the accompanying parent-only balance sheets of Taiwan Mask Corporation as of December 31, 2023 and 2022, and the related statements of comprehensive income, of changes in equity and of cash flows for the years ended December 31, 2023 and 2022, and notes to the parent-only financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of the other independent auditors, as described in the Other matters section of our report, the parent-only financial statements present fairly, in all material respects, the standalone financial position of Taiwan Mask Corporation as of December 31, 2023 and 2022, and its financial performance and its cash flows for the years ended December 31, 2023 and 2022, in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers”.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial statements of Taiwan Mask Corporation of fiscal year 2023. These matters were addressed in the context of our audit of the parent only financial statements as a whole and, in forming our opinion thereon, we do not provide a parent only opinion on these matters.

~5~

Taiwan Mask Corp. Control Security C

Key audit matters for the parent-only financial statements in fiscal year 2023 are stated as follows:

Evaluation of Inventories

Explanation

Refer to Note 4(12) for the accounting policies on the valuation of inventories, Note 5(2) for the uncertainty of accounting estimations and assumptions for valuation of inventories, inventory accounts description please refer to Note 6(5), for the details of allowance for inventory valuation. The inventory amount and allowance for inventory valuation loss as of December 31, 2023 is NT$134,369 thousand and NT$4,794 thousand, respectively.

Taiwan Mask Corporation is primarily engaged in mask and integrated circuit services in the semiconductor industry. Due to rapid technological innovations, short life-cycle and competition within the mask industry, the risk of price fluctuations, loss on decline in value of inventories and obsolescence is higher than that of other industries. Management evaluates inventories stated at the lower of cost and net realizable value. Since the evaluation of inventories is subject to management’s judgment and the accounting estimations will have significant influence on the inventory values, the evaluation of inventories has been identified as one of the key audit matters.

How our audit addressed the matter

We have performed primary audit procedures for the above matter as follows:

1. Understand and evaluate the accounting policy for the provision of allowance for losses on decline in value of inventories.

2. Perform test to evaluate the ageing statement of inventories and the statement of lower of cost and net realizable value of inventories, including validating the supporting documents related to the date of inventory movement to confirm the correct ageing classification, and validating the supporting documents related to the net realizable value to assess and confirm the reasonableness of the net realizable value determination.

3. Verify the reasonableness of allowance for inventory valuation loss.

Income recognition

Explanation

For the accounting policy on income recognition, please refer to Note 4(27) of the financial report. For sales revenue please refer to Note 6(21); the operating income in fiscal year 2023 is NT$3,985,541 thousand.

~6~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation mainly produces and sells products such as masks and integrated circuits used in semiconductors, and has a large and diversified sales base. Trading conditions vary according to market conditions and customer needs. Considering that sales revenue is a major transaction that significantly impacts the standalone financial statements, we believe that the recognition of sales revenue is one of the most important matters to be considered in this year’s audit.

How our audit addressed the matter

We have performed primary audit procedures for the above matter as follows:

1. Understand the type of major income and assess internal operations, review revenue recognition and accounting treatment.

2. Obtain the sales revenue statement, sample the sales transactions and verify the relevant documents to determine the appropriateness of the sales revenue.

3. Execute the cut-off test for the sales receipts transaction for a certain period of time before and after the closing date, and confirm that the account is correct at the time of entry.

Responsibilities of management and those charged with governance for the parent only financial statements

Management is responsible for the preparation and fair presentation of the parent only financial statements in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of parent only financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the parent only financial statements, management is responsible for assessing Taiwan Mask Corporation’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 Taiwan Mask Corporation or to cease operations, or has no realistic alternative but to do so.

Those charged with governance, including the Audit Committee, are responsible for overseeing Taiwan Mask Corporation’s financial reporting process.

~7~

Taiwan Mask Corp. Control Security C

Independent auditor’s responsibilities for the audit of the parent only financial statements

Our objectives are to obtain reasonable assurance about whether the parent only financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ROC AS 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 parent only financial statements.

As part of an audit conducted in accordance with ROC AS, we exercise professional judgment and professional skepticism throughout the audit. We also conduct the following undertakings:

1. Identify and assess the risks of material misstatement of the parent only financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Taiwan Mask Corporation’s internal control.

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

4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on Taiwan Mask Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the parent only financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause Taiwan Mask Corporation to cease to continue as a going concern.

5. Evaluate the overall presentation, structure and content of the parent only financial statements, including the disclosures, and whether the parent only financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

~8~

Taiwan Mask Corp. Control Security C

1. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within Taiwan Mask Corporation to express an opinion on the parent only financial statements. We are responsible for the direction, supervision and performance of the audit. We remain solely responsible for our audit opinion.

We communicated 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 for the current period.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the parent-only financial statements for the year ended December 31, 2023, 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 auditor’s report because the adverse consequences of doing so would reasonable are expected to outweigh the public interest benefits of such communication.

PricewaterhouseCoopers Taiwan

Ya-Hui Cheng

Accountant

Chien-Yu Liu

Securities and Futures Bureau of Financial Supervisory Commission of the Executive Yuan Approval Certificate No. 0960072936

Financial Supervisory Commission of the Executive Yuan

Approval Document for Attestation: Jin-Guan-Zheng-Shen-Zi No. 1090350620

March 6, 2024

~9~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Only Balance Sheet December 31, 2023 and 2022

Assets	Notes 6(1) 6(2) and 8 6(3) 6(21) 6(4) 6(4) and 7 7 6(5) 6(2) and 8 6(3) and 8 6(6) 6(7) and 8 6(8) 6(10) and 8 6(28) 6(11)	December31,2023 Amount % $ 451,993 3 397,340 3 3,000 - 86,821 - 685,798 5 6,494 - 4,520 - 90,940 - 129,575 1 97,617 1 190 - 1,954,288 13 859,962 6 417,504 3 1,866,791 13 7,862,213 54 535,527 4 662,854 5 45,675 - 5,310 - 359,147 2 12,614,983 87 $ 14,569,271 100	Unit: NT$ Thousand December31,2022 Amount % $ 1,211,411 9 307,448 2 3,000 - 90,642 1 800,431 6 9,525 - 4,566 - 17,443 - 118,709 1 104,427 1 803 - 2,668,405 20 925,006 7 222,774 2 1,897,832 15 4,762,328 37 541,438 4 683,746 5 41,720 - 1,780 - 1,331,600 10 10,408,224 80 $ 13,076,629 100
		Amount $ 451,993 397,340 3,000 86,821 685,798 6,494 4,520 90,940 129,575 97,617 190 1,954,288 859,962 417,504 1,866,791 7,862,213 535,527 662,854 45,675 5,310 359,147 12,614,983 $ 14,569,271	Amount $ 1,211,411 307,448 3,000 90,642 800,431 9,525 4,566 17,443 118,709 104,427 803 2,668,405 925,006 222,774 1,897,832 4,762,328 541,438 683,746 41,720 1,780 1,331,600 10,408,224 $ 13,076,629
Current assets 1100 Cash and Cash Equivalents 1110 Financial Assets at Fair Value Through Profit or Loss - Current 1136 Financial Assets at Amortized Cost - Current 1140 Contract Asset - Current 1170 Accounts Receivables (Net) 1180 Accounts Receivables - Related Parties (Net) 1200 Other Receivables 1210 Other Receivables - Related Parties 130X Inventories 1410 Prepayments 1470 Other Current Assets 11XX Total Current Assets Non-Current Assets 1510 Financial Assets at Fair Value Through Profit or Loss - Non Current 1535 Financial Assets at Amortized Cost - Non Current 1550 Investment under Equity Method 1600 Property, plant and equipment 1755 Right-of-use Asset 1760 Investment property (Net) 1780 Intangible assets 1840 Deferred Income Tax Assets 1900 Other Non-Current Assets 15XX Total Non-Current Assets 1XXX Total Assets

(continued on next page)

~10~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Only Balance Sheet December 31, 2023 and 2022

Liabilities and Equities

Unit: NT$ Thousand December31,2023 December31,2022 Notes Amount % Amount % 6(12) $ 1,079,983 8 $ 1,054,934 8 6(2) 9,383 - 5,697 - 6(21) 33,984 - 57,323 1 117,596 1 109,004 1 6(13) 669,580 5 520,173 4 7 4,131 - - - 2,623 - 150,791 1 31,939 - 30,682 - 6(15) 872,834 6 484,737 4 47,783 - 29,182 - 2,869,836 20 2,442,523 19 6(14) 3,424,600 23 2,609,044 20 6(15) 2,592,429 18 2,905,263 22 6(28) 219 - 3,850 - 514,436 4 518,641 4 6(16) 10,648 - 16,514 - 6(31) 33,961 - 33,874 - 6,576,293 45 6,087,186 46 9,446,129 65 8,529,709 65 6(17) 2,564,465 18 2,564,465 20 6(18) 1,439,959 9 1,251,681 10 6(19) 827,460 6 769,952 6 1,464,101 10 1,729,293 13 6(20) 1,641 - 10,508 - 6(17) ( 1,174,484) ( 8 ) ( 1,778,979) ( 14) 5,123,142 35 4,546,920 35 9 11 $ 14,569,271 100 $ 13,076,629 100

Current liabilities 2100 Short Term Loans 2120 Financial liabilities at fair value through profit or loss - Current 2130 Contract Liabilities - Current 2170 Accounts Payable 2200 Other Payables 2220 Other Payables - Related Parties 2230 Income Tax Liabilities for the Period 2280 Lease Liability - Current 2320 Long-term liabilities due within one year or one business cycle 2399 Other Current Liabilities - Other 21XX Total Current Liabilities Non-current liabilities 2530 Corporate bonds payable 2540 Long-term Loans 2570 Deferred Income Tax 2580 Lease liability - Non Current 2640 Defined Benefit Liabilities - Non Current 2645 Guarantee Deposits Received 25XX Total Non-Current Liabilities 2XXX Total Liabilities Capital 3110 Capital stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3350 Unappropriated earnings Other equity interests 3400 Other equity interests 3500 Treasury stock 3XXX Total Equities Major Commitments and Contingencies Major Events after Financial Statement Date 3X2X Total Liabilities and Equities

The attached notes to the standalone financial statements are part of the standalone financial report.

Chairman: Sean Chen

Managerial Officer: Lidon Chen Accounting Supervisor: Eve Yang

~11~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Company Only Comprehensive Income Statement January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand (Except for earnings per share)

Items

2023 2022 Notes Amount % Amount % 6 (21) and 7 $ 3,985,541 100 $ 3,887,648 100 6(5) ( 2,322,564) ( 58) ( 1,796,579) ( 46) 1,662,977 42 2,091,069 54 6(26) (27) ( 75,496) ( 2) ( 63,495 ) ( 2 ) ( 304,800) ( 8) ( 272,202 ) ( 7 ) ( 152,015) ( 4) ( 92,972 ) ( 2 ) 12(2) ( 418) - ( 821) - ( 532,729) ( 14) ( 429,490) ( 11) 1,130,248 28 1,661,579 43 6(22) 27,316 1 11,798 - 6(23) 204,573 5 195,387 5 6(24) ( 8,162) - ( 205,013 ) ( 5 ) 6(25) ( 162,406) ( 4) ( 91,694 ) ( 2 ) ( 579,274) ( 15) ( 676,888) ( 18) ( 517,953) ( 13) ( 766,410) ( 20) 612,295 15 895,169 23 6(28) ( 246,169) ( 6) ( 191,650) ( 5) $ 366,126 9 $ 703,519 18 6(16) ($ 1,145) - ( $ 2,721 ) - - - 65 - ( 1,145) - ( 2,656) - 6(20) ( 8,867) - 6,476 - ( 8,867) - 6,476 - ($ 10,012) - $ 3,820 - $ 356,114 9 $ 707,339 18 6(29) $ 1.75 $ 3.37 6(29) $ 1.65 $ 3.12

4000 Operating income 5000 Operating costs 5900 Gross profit Operating expenses 6100 Selling Expenses 6200 Administrative Expenses 6300 R&D Expenses 6450 Expected loss on credit impairment 6000 Total Operating Expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other Incomes 7020 Other Gains and Losses 7050 Financial Costs 7070 The share of subsidiaries, affiliates and joint venture profits and losses recognized by the equity method 7000 Total Non-Operating Incomes and Losses 7900 Earnings Before Tax 7950 Income Tax Expense 8200 Net profit for the period Other Comprehensive Incomes (Net) Components of other comprehensive income that will not be reclassified to profit or loss 8311 Re-measurements of defined benefit plan 8330 Profit and loss of subsidiaries, associates and joint ventures recognized by using equity method - Items that will not be reclassified to profit or loss 8310 Total items that will not be reclassified subsequently to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statement translation differences of foreign operations 8360 Total Components of other comprehensive income that will be reclassified to profit or loss 8300 Other Comprehensive Incomes (Net) 8500 Total comprehensive income for the year Earnings per share 9750 Net Income (Loss) Diluted Earnings per share 9850 Net profit for the period

The attached notes to the standalone financial statements are part of the standalone financial report.

Chairperson: Sean Chen Managerial Officer: Lidon Chen Accounting Officer: Eve Yang

~12~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Company Only Statement of Changes in Equity January 1 to December 31, 2023, and 2022

2022 Balance January 1, 2022 Net Income Other Comprehensive Profit or Loss Total comprehensive income for the year Distribution and appropriation of earnings for 2021 Legal capital reserve Cash dividends Conversion of convertible bonds Distribution of cash from capital surplus Adjustment of capital reserve by dividends paid to subsidiaries Changes in ownership interests in subsidiaries recognized Changes in shares of affiliates and joint ventures recognized under the equity method Share-based payment transaction Treasury Stock Buyback Subsidiaries donated treasury stock Balance December 31, 2022 2023 Balance as at January 1, 2023 Net profit for the period Other Comprehensive Profit or Loss Total comprehensive income for the year Distribution and appropriation of earnings for 2022 Legal capital reserve Cash dividends Distribution of cash from capital surplus Adjustment of capital reserve by dividends paid to subsidiaries Changes in ownership interests in subsidiaries recognized Changes in shares of affiliates and joint ventures recognized under the equity method Subsidiaries donated treasury stock Treasury stocks transfer to employees Payment of overdue unclaimed dividends to shareholders Balance as of December 31, 2023	Notes		Capitalstock		Capitalsurplus			Retained earnings	Retained earnings	Retained earnings	Retained earnings		Otherequityinterests	Otherequityinterests	Otherequityinterests		Unit: NT$ Thousand Treasury stock Total Equity ($ 941,423 ) $ 5,061,360 - 703,519 - 3,820 - 707,339 - - - ( 241,189 ) - 63,202 - ( 241,189 ) - 73,463 - ( 76,448 ) - 21,107 - 16,831 ( 842,536 ) ( 842,536 ) 4,980 4,980 ($ 1,778,979 ) $ 4,546,920 ($ 1,778,979 ) $ 4,546,920 - 366,126 - ( 10,012 ) - 356,114 - - - ( 572,665 ) - ( 49,797 ) - 90,829 - 133,604 - 13,793 12,807 12,807 591,688 591,688 - ( 151 ) ($ 1,174,484 ) $ 5,123,142
							Legal reserve		Special reserve	Unappropriated earnings			Financial statement translation differences of foreign operations	a	Unrealized gain or loss on financial ssets measured at fair value through other comprehensive income
	6(20) 6(19) 6(17) 6(18) 6(18) 6(18) 6(18) 6(18) 6(17) 6(17) 6(20) 6(19) 6(18) 6(18) 6(18) 6(18) 6(17) 6(17) 6(18)		$ 2,556,735 - - - - - 7,730 - - - - - - - $ 2,564,465 $ 2,564,465 - - - - - - - - - - - - $ 2,564,465		$ 1,315,828 - - - - - 55,472 ( 241,189 ) 73,463 10,169 21,107 16,831 - - $ 1,251,681 $ 1,251,681 - - - - - ( 49,797 ) 90,829 133,604 13,793 - - ( 151 ) $ 1,439,959		$ 656,037 - - - 113,915 - - - - - - - - - $ 769,952 $ 769,952 - - - 57,508 - - - - - - - - $ 827,460		$ - - - - - - - - - - - - - - $ - $ - - - - - - - - - - - - - $ -		$ 1,470,151 703,519 ( 2,656 ) 700,863 ( 113,915 ) ( 241,189 ) - - - ( 86,617 ) - - - - $ 1,729,293 $ 1,729,293 366,126 ( 1,145 ) 364,981 ( 57,508 ) ( 572,665 ) - - - - - - - $ 1,464,101		$ 6,698 - 6,476 6,476 - - - - - - - - - - $ 13,174 $ 13,174 - ( 8,867 ) ( 8,867 ) - - - - - - - - - $ 4,307		($ 2,666 ) - - - - - - - - - - - - - ($ 2,666 ) ($ 2,666 ) - - - - - - - - - - - - ($ 2,666 )		($ 941,423 ) - - - - - - - - - - - ( 842,536 ) 4,980 ($ 1,778,979 ) ($ 1,778,979 ) - - - - - - - - - 12,807 591,688 - ($ 1,174,484 )

Chairman: Sean Chen

The attached notes to the standalone financial statements are part of the standalone financial report. Managerial Officer: Lidon Chen

Accounting Supervisor: Eve Yang

~13~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Company Only Cash Flow Statements January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand

Cash Flow from Operating Activities Net Income(Loss) Before Tax Adjustments to Reconcile Net Income to Net Cash Flow from Operating Activities Revenues and Expenses Depreciation Amortization Expected loss on credit impairment Dividend income Interest income Interest Incomes Loss (gain) on financial assets measured at fair value through profit or loss Loss on disposal of investments Share-based payment transaction The Share of Subsidiaries and Affiliates Profits and Losses Recognized by the Equity Method Property, plant and equipment reclassified as expenses The Changes of Assets/ Liabilities related to Operating Activities Net Changes of Assets related to Operating Activities Mandatory financial assets at fair value through profit or loss Contract Assets Accounts Receivables Accounts Receivables－Related Parties Other Receivables Other Receivables－Related Parties Inventories Prepayments Other Current Assets Net Changes of Liabilities related to Operating Activities Contract Liabilities Accounts Payable Other Payables Other Payables- related Parties Other Current Liabilities Defined Benefit Liabilities Net Cash In-Flow from Operating Dividends Received Interest Received Interest Paid Income Tax Paid Net Cash In-Flow (Out-Flow) from Operating Activities

Notes 2023 2022 $ 612,295 $ 895,169 6(26) 798,565 513,116 6(26) 24,041 6,284 12(2) 418 821 6(23) ( 51,566 ) ( 33,682 ) 6(22) ( 27,317 ) ( 11,798 ) 6(25) 162,406 91,694 6(24) ( 8,662 ) 114,183 6(24) - 119,316 6(17) - 14,131 579,274 676,888 6(7) 78 116 ( 12,500 ) ( 357,348 ) 3,821 25,212 114,215 ( 208,285 ) 3,031 ( 4,413 ) ( 1,455 ) 993 ( 73,497 ) ( 2,573 ) ( 10,866 ) ( 8,820 ) 7,020 ( 67,468 ) 613 170 ( 23,339 ) 49,663 8,592 27,553 7,370 29,844 1,626 - 18,601 ( 3,385 ) ( 7,012 ) ( 1,749 ) 2,125,752 1,865,632 69,929 70,496 28,813 10,065 ( 134,928 ) ( 90,670 ) ( 401,498 ) ( 157,909 ) 1,688,068 1,697,614

(continued on next page)

~14~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Parent Company Only Cash Flow Statements January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand

Cash Flow from Investment Activities Acquisition of Amortized Cost Financial Assets Disposal of Amortized Cost Financial Assets Acquisition of investment property by the Equity Method Acquisition of Property, Plants and Equipment Acquisition of Intangible Assets Increase in refundable deposit Net Cash Outflow from Investing Activities Cash Flows from Financing Activities Increase of Short Term Loan Redemption of Short Term Loan Increase of Long Term Loan Redemption of Long Term Loan Issuance of ordinary corporate bonds Distribution of cash dividends (including capital surplus distribution cash) Treasury stocks transfer to employees Cost of treasury stock buyback Redemption of Lease Principal Increase in Guarantee Deposits Received Transfer of unclaimed dividends as Additional Paid-in Capital Net Cash In-Flow (Out-Flow) from Funding Activities Increase (Decrease) in Cash and Cash Equivalents Beginning Balance of Cash and Cash Equivalents Ending Balance of Cash and Cash Equivalents

Notes 2023 2022 ( $ 527,651 ) ( $ 187,349 ) 332,921 - ( 324,431 ) - 6(30) ( 2,732,591 ) ( 2,662,286 ) ( 27,996 ) ( 39,486 ) ( 1,431 ) ( 2,370 ) ( 3,281,179 ) ( 2,891,491 ) 6(31) 4,395,672 5,662,100 6(31) ( 4,370,623 ) ( 5,467,166 ) 6(31) 930,631 4,624,737 6(31) ( 855,368 ) ( 3,884,737 ) 6(31) 797,338 997,095 6(19) ( 622,462 ) ( 482,378 ) 6(17) 591,688 - 6(17) - ( 842,536 ) 6(31) ( 33,119 ) ( 29,737 ) 6(31) 87 29,069 ( 151 ) - 833,693 606,447 ( 759,418 ) ( 587,430 ) 1,211,411 1,798,841 $ 451,993 $ 1,211,411

The attached notes to the standalone financial statements are part of the standalone financial report.

Chairperson: Sean Chen Managerial Officer: Lidon Chen

Accounting Officer: Eve Yang

~15~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Notes to the Parent Company Only Financial Statements 2023 and 2022

Unit: NT$ Thousand (Unless otherwise specified)

I. Company History

Taiwan Mask Corporation (hereinafter referred to as the “Company”) was established on October 21, 1988, and started its operations in March 1989. The Company was approved by the shareholders meeting on June 12, 2000 to acquire Shin-Tai Technology Co., Ltd., on the merger record date of December 1, 2000, with the Company being the surviving entity. The Company mainly engage in the research, development, manufacturing and sales of photomask, providing technical assistance, consultation, inspection and repair of the abovementioned products.

II. Date and procedures for passing the financial report

The accompanying parent-only financial statements were approved and authorized for issuance by the Board of Directors on March 6, 2024.

III. Application of New and Revised International Financial Reporting Standards

(I) The impact from adopting the newly released and revised IFRS and IAS recognized and issued into effect by the Financial Supervisory Commission (FSC).

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS recognized and issued into effect by the Financial Supervisory Commission in 2023:

Newly released/corrected/amended standards and Effective Date Issued by interpretations IASB Amendment to IAS 1 - “Disclosure of Accounting Policies” January 1, 2023 Amendments to IAS 8 “Definition of Accounting Estimates” January 1, 2023 Amendments to IAS 12, “Deferred Income Taxes Related to January 1, 2023 Assets and Liabilities Arising from a Single Transaction”

Amendment to IAS 12 “International Tax Reform - Pillar Two May 23, 2023 Model Rules”

The Company believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

~16~

Taiwan Mask Corp. Control Security C

• (II) Impact of the newly released and amended IFRS and IAS recognized by the FSC not yet adopted by the Company.

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS recognized by the Financial Supervisory Commission in 2024:

Newly released/corrected/amended standards and Effective Date Issued by interpretations IASB Amendments to IFRS 16 - “Liabilities of Lease from the January 1, 2024 Leaseback” Amendment to IAS 1 “Classification of Liabilities as Current January 1, 2024 or Non-Current” Amendment to IAS 1 “Non-Current Liabilities With January 1, 2024 Covenants” Amendments to IAS 7 and IFRS 7 “Supplier Financing January 1, 2024 Arrangements”

The Company believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

• (III) IFRS and IAS issued by the IASB but not yet recognized by the FSC.

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS issued by the IASB but not yet recognized by the FSC:

Newly released/corrected/amended standards and	Effective Date Issued by
interpretations	IASB
IFRS 10 and IAS 28 amendments, Sale or contribution of	To be determined by the
assets between an investor and its associate or joint venture	IASB
IFRS 17 - Insurance contracts	January 1, 2023
Amendment to IFRS 17 - Insurance contracts	January 1, 2023
Amendments to IFRS 17 “First-time Adoption of IFRS 17 and	January 1, 2023
IFRS 9 - Comparative Information”
Amendments to IAS No. 21 “Lack of Exchangeability”	January 1, 2023

The Company believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

~17~

Taiwan Mask Corp. Control Security C

IV. Summary of significant accounting policies

The principal accounting polices applied in the preparation of these parent only financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(I) Compliance statement

These parent only financial statements of the Company have been prepared in accordance with the “Rules Governing the Preparation of Financial Statements by Securities Issuers”.

(II) Basis of Preparation

1. Except for the following items, these parent only financial statements have been prepared under the historical cost convention.

2. (1) Financial assets and financial liabilities at fair value through profit or loss (including derivatives).

3. (2) Financial Assets at Fair Value Through Other Comprehensive Income.

4. (3) Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

5. The preparation of financial statements in conformity with IFRS, IAS, IFRIC Interpretations, and SIC Interpretations as endorsed by the FSC (collectively referred herein as the “IFRSs”) requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the parent company only financial statements are disclosed in Note 5.

(III) Foreign currency translation

Items included in the financial statements of the Company are measured using the currency of the primary economic environment in which the Company operates (the “functional currency”). The parent only financial statements are presented in New Taiwan dollar, which is the Company’s functional currency and reporting currency.

1. Foreign currency transactions and balances

2. (1) Foreign currency transactions are translated into the functional currency using spot exchange rate at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise.

3. (2) Monetary assets and liabilities denominated in foreign currencies at the period end are re-translated using spot exchange rate at the balance sheet date. Exchange differences arising from re-translation at the balance sheet date are recognized in profit or loss.

4. (3) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated using spot exchange rate at the balance sheet date. Their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated using spot exchange at the balance sheet date. Their translation differences are recognized in other comprehensive income. For those which are not measured at fair value, they measured by the historical exchange rate of the initial transaction date.

~18~

Taiwan Mask Corp. Control Security C

• (4) All foreign exchange gains and losses are presented in the statement of comprehensive income within “Other gains and losses”.

• Translation of foreign operations

• (1) The operating results and financial position of all corporate group entities and affiliates that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

  • A. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet.

  • B. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period.

  • C. All resulting exchange differences are recognized in other comprehensive income.

• (2) When the foreign operation that is partially disposed of or sold is a subsidiary, the accumulated conversion difference recognized as other comprehensive income is reattributed to the foreign operation’s non-controlling interests on a pro rata basis. However, even if the Company retains part of its equity in the former subsidiary, but has lost control of the subsidiary of the foreign operation, it will be treated with as a disposal of the entire equity of the foreign operation

• (3) Goodwill and fair value adjustments arising on acquisition of a foreign entity are regarded as assets and liabilities of the foreign entity, and are translated at the closing rate.

(IV) Classification of current and non-current items

1. Assets that meet one of the following criteria are classified as current assets:

2. (1) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle.

3. (2) Assets held mainly for trading purposes.

4. (3) Assets that are expected to be realized within twelve months from the balance sheet date.

5. (4) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

Assets that do not meet the above criteria are considered non-current.

1. Liabilities that meet one of the following criteria are classified as current liabilities:

2. (1) Liabilities that are expected to be paid off within the normal operating cycle.

3. (2) Assets held mainly for trading purposes.

4. (3) Liabilities that are to be paid off within twelve months from the balance sheet date.

5. (4) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Liabilities that do not meet the above criteria are considered non-current.

(V) Cash equivalents

Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time

~19~

Taiwan Mask Corp. Control Security C

deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

• (VI) Financial assets at fair value through profit and loss

• Refer to the financial assets that are not measured at amortized cost, or are measured at fair value through other comprehensive gain or loss.

• On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting.

• The Company measures financial assets at fair value in initial recognition. The related transaction costs are recognized in profit and loss. These financial assets are subsequently re-measured and stated at fair value, and any changes in the fair value of these financial assets are recognized in profit or loss.

• When the right to receive dividends is established, the economic benefits associated with the dividends are likely to flow in, and the amount of dividends can be reliably measured, the Company recognizes dividend income in profit or loss.

(VII) Financial assets measured at amortized cost

1. Refer to those that meet the following criteria at the same time:

2. (1) The objective of the business model is achieved by collecting contractual cash flows.

3. (2) The assets’ contractual cash flows solely represent payments of principal and interest.

4. The Company holds time deposits that are not considered cash equivalents. Due to the short holding period, the impact of discounting is insignificant and is measured by the amount of investment.

(VIII) Accounts and notes receivable

1. Refers to accounts and notes that have been unconditionally charged for the right to exchange the value of the consideration due to the transfer of goods or services.

2. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(IX) Impairment Loss of Financial Assets

Regarding the financial assets measured at amortized cost, accounts receivable or contract assets that contain significant financing components, the Company, on each balance sheet date, considers all reasonable and supportable information (including forward-looking ones) and measure the loss allowance based on the 12-month expected credit losses for those that do not have their credit risk increased significantly since initial recognition. For those that have increased significantly since initial recognition, the loss allowance is measured based on the full lifetime expected credit losses. A loss allowance for full lifetime expected credit losses is also required for contract assets or trade receivables that do not constitute a financing transaction.

(X) De-recognition of financial assets

A financial asset is derecognized when the Company’s rights to receive cash flows from the financial assets have expired.

(XI) Lessor’s lease transaction - Operating lease

Lease income from operating leases, less any incentives given to the lessee, is amortized in current profit or loss on a straight-line basis over the lease term.

~20~

Taiwan Mask Corp. Control Security C

(XII) Inventories

Inventories are measured at the lower of cost or net realizable value, and the cost is determined by weighted-average method. The cost of finished goods and work-in-progress comprises raw materials, direct labor, other direct costs and related production overheads (amortized according to normal production capacity), but excludes borrowing costs. At the end of year, inventories are evaluated at the lower of cost or net realizable value. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable costs of completion and selling expenses.

(XIII) Investments accounted for using equity method - Subsidiaries and associates

1. Subsidiaries are all entities (including structured entities) controlled by the Company. The Company controls an entity when the Company is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

2. Unrealized gains or losses on transactions between Company and its subsidiaries are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Company.

3. The Company recognized the profit and loss upon the acquisition of subsidiaries as the current profit and loss. Other comprehensive profit and loss after the acquisition are recognized as the other comprehensive profit and loss. If the Company’s recognized profit and loss of the subsidiaries equal to or exceed the equity in the subsidiaries, the Company will continue to recognize the loss in proportion to its shareholding.

4. Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are equity transactions, and they are considered as transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is directly recognized in equity.

5. When the Company loses control of a subsidiary, the Company remeasures any investment retained in the former subsidiary at its fair value. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Company loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

6. Associates refer to entities over which the Company has significant influence but is not in control. In general, the associates may have more than 20% of their voting shares directly or indirectly owned by the Company. The Company accounts for its investment in associates using the equity method, and the investment is initially recognized at cost.

7. The Company recognizes the profit and loss upon the acquisition of associates as the current profit and loss. Other comprehensive profit and loss after the acquisition are recognized as the other comprehensive profit and loss. When the Company’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Company will not recognize further losses, unless it has

~21~

Taiwan Mask Corp. Control Security C

incurred legal or constructive obligations or make payments on behalf of the associate.

1. If an associate has changes in equity not from profit or loss or other comprehensive income, and such changes do not affect the Company’s shareholding in the associate, the Company will recognize all changes in equity attributable to the Company’s share of the associate as “capital surplus” according to the shareholding percentage.

2. Unrealized gains on transactions between the Company and associates are eliminated to the extent of the Company’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Company.

3. In the event that an associate issues new shares and the Company does not subscribe to or acquire the new shares in proportion, which results in a change to the Company’s shareholding percentage but the Company maintains a significant influence on the associate, the increase or decrease of the Company’s share of equity interest is the adjustment of “capital surplus” and “investments accounted for under the equity method”. If the investment percentage is reduced, in addition to the above adjustments, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionally on the same basis as would be required if the relevant assets or liabilities were disposed of.

4. Pursuant to the “Guidelines Governing the Preparation of Financial Statements by Securities Issuers”, the profit or loss during the period and other comprehensive income presented in consolidated financial statements shall be the same as the allocations of profit or loss during the period and of other comprehensive income attributable to owners of the parent presented in the financial statements prepared on a consolidated basis, and the owners’ equity presented in the parent company only financial statements shall be the same as the equity attributable to owners of the parent presented in the financial statements prepared on a consolidated basis.

(XIV) Property, plant and equipment

1. Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.

2. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the costs of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

3. Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.

4. The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any changes are accounted for as a change in estimate under IAS 8, “Accounting Policies, Changes in Accounting Estimates and Errors,” from the date of the change. The estimated

~22~

Taiwan Mask Corp. Control Security C

useful lives of property, plant and equipment are as follows:

Buildings and structures 3 years to 56 years Machinery and equipment 2 years to 16 years Transportation equipment 5 years Office equipment 3 years to 9 years

(XV) Leasing agreements (lessee) - Right-of-use assets/lease liabilities

1. Leases are recognized as right-of-use assets and lease liabilities at the date at which the leased assets are available for use by the Company. For short-term leases or leases of lowvalue assets, lease payments are recognized as expenses on a straight-line basis over the lease term.

2. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments include fixed payments, less any lease incentives receivables.

The Company subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of re-measurement is recognized as an adjustment to the rightof-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

1. At the commencement date, the right-of-use asset is recognized at cost which includes:

2. (1) The amount of initial measurement of lease liability.

3. (2) Any lease payments made at or before the commencement date.

4. (3) Any original direct costs incurred.

5. (4) The estimated cost of dismantling, removing the underlying asset and restoring its location, or restoring the underlying asset to the condition required in the lease terms and conditions.

The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s service life or the end of lease term. When the lease liability is remeasured, the amount of re-measurement is recognized as an adjustment to the right-of-use asset.

(XVI) Real estate investment

Investment properties are initially measured at cost, and may be subsequently measured using a cost model. Except for land, the service life is recognized on a straight-line basis of depreciation and is about 45 years.

(XVII) Intangible assets

Computer software is recognized at the cost of acquisition, and amortized based on the estimated useful life of 3 years based on the straight-line method.

(XVIII) Impairment of non-financial assets

The Company assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less disposal cost or value in use.

~23~

Taiwan Mask Corp. Control Security C

When the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.

(XIX) Borrowings

Refers to long- and short-term funds borrowed from banks and other long- and short-term borrowings. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method.

(XX) Accounts and notes receivable

1. Refers to debts incurred as a result of the purchase of raw materials, goods or services and the notes payable due to business and non-business purposes.

2. The short-term accounts and notes payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(XXI) Convertible bonds payable

The convertible bonds payable issued by the Company are embedded with conversion options (i.e., the holder’s right to choose to convert to the Company’s common stock for a fixed amount of shares), put options and call options. The issuance price is classified as financial assets, financial liabilities or equity at the time of initial issuance according to the terms of issuance, which is treated as follows:

1. Embedded put options and call options: “Financial assets or liabilities at fair value through profit or loss” are recorded at their net fair value on initial recognition; subsequently, “Gain or loss on financial assets (liabilities) at fair value through profit or loss” is recognized on the balance sheet date, with the difference valued at current fair value.

2. Master contract of corporate bonds: The difference between the fair value of the corporate bonds and the redemption value is recognized as a premium or discount on the corporate bonds payable at the time of original recognition; subsequently, it is recognized in profit or loss as an adjustment to “finance costs” using the effective interest method under the amortization procedure over the circulation period.

3. Embedded conversion options (which meet the definition of equity): On initial recognition, the remaining value of the issue amount, net of the above “financial assets or liabilities at fair value through profit or loss” and “corporate bonds payable”, is recorded as “capital surplus - stock options” and is not subsequently remeasured.

4. Any directly attributable transaction costs of the issuance are allocated to each component of liabilities and equity in proportion to the original carrying amount of each component mentioned above.

5. Upon conversion, the components of liabilities (including “corporate bonds payable” and “financial assets or liabilities at fair value through profit or loss”) are subsequently measured according to their respective classifications, and the carrying amount of the aforementioned components of liabilities is added to the carrying amount of “capital surplus - stock options” as the issuance cost of common stock exchanged.

~24~

Taiwan Mask Corp. Control Security C

(XXII) Employee benefits

1. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should be recognized as expenses in that period when the employees render service.

1. Pension

2. (1) Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

• (2) Defined-benefit plans

• A. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using the current interest rates of government bonds (at the balance sheet date) consistent with the currency and period of the defined-benefit plan instead.

• B. Re-measurements arising on defined-benefit plans are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

• C. The related expenses of the past service cost are immediately recognized as profit and loss.

3. Termination benefits

Refer to when companies decide to terminate the employees before the normal retirement date, or when employees decide to accept the benefits in exchange for the termination. The Company recognizes expenses when it is no longer able to withdraw the offer of termination benefits or when the relevant restructuring costs are recognized, whichever is earlier. Liabilities that are not expected to be paid off within twelve months from the balance sheet date should be discounted.

1. Remuneration for employees and directors

Employees’ bonuses and directors’ remuneration are recognized as expense and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

(XXIII) Share-based payment to employees

The share-based payment agreement for delivery of equity is a transaction in which employees’ labor service received as consideration for the Company’s equity instrument at fair value, and it is recognized as compensation costs during the vesting period, and the

~25~

Taiwan Mask Corp. Control Security C

equity is adjusted accordingly. The fair value of equity instrument shall reflect the effects of vesting and non-vesting conditions of market value. The recognized remuneration costs are adjusted in accordance with the expected service conditions to be met and the nonvesting market value conditions, until the final recognized amount is recognized with the vesting amount on the vesting date.

(XXIV) Income tax

1. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity.

2. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted by the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

3. Deferred income tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the parent only balance sheet. However, the deferred income tax arising from the initially recognized goodwill is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss and does not generate taxable and deductible temporary difference. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Company and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.

4. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognized and recognized deferred income tax assets are reassessed.

(XXV) Capital

1. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

2. When the Company buys back the issued shares, the consideration paid, including any directly attributable incremental costs, is recognized as a deduction of shareholders’ equity with the net amount after tax. When the purchased shares are subsequently reissued, the difference between the consideration received and the book value after deducting any directly attributable incremental costs and the impact of income tax is recognized as an adjustment to shareholders’ equity.

~26~

Taiwan Mask Corp. Control Security C

(XXVI) Dividend distribution

Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities. Stock dividends are recorded as dividends to be distributed and transferred to be common stocks on the record date of issuance of new shares.

(XXVII) Recognized revenue

1. The Company mainly provides photomask manufacturing services. The actual services provided and fees will vary according to different customers. Prices are negotiated separately before providing services, and are based on the prevailing market price. The performance obligations identified based on customer contracts are mainly for photomask manufacturing services, and revenue is recognized by measuring the degree of completion of performance obligations during the period of service provision.

With the provision of photomask manufacturing services, the customer simultaneously receives and consumes the performance benefits, and the customer has control over the asset when the asset is created or enhanced. The Company’s performance does not create any assets available for other purposes and has the exercisable right to the amount that has been completely performed till now. The related revenue is recognized by measuring the degree of completion of the performance obligation during the service period. The photomask manufacturing service is based on the input of the technical staff on the basis of the service, and the progress of completion is measured based on the percentage of the incurred cost to the estimated total cost. After the agreed service or shipment is fulfilled for the contract agreement, a bill is issued, so the contract assets are recognized when the service provided, and transferred to account receivables when the customer agrees to the Company to issue the bill.

1. The time interval between the transfer products or services promised to customers and the customers’ payment has not exceeded one year, so the Company has not adjusted the transaction price to reflect the time value of money.

(XXVIII) Government subsidies

Government subsidies are recognized at fair value once it is reasonably convinced that the Company complies with the conditions for subsidies and will be receiving the subsidies. If the nature of the government subsidies is to compensate the expenses incurred by the Company, the government subsidies are recognized as current gains and losses on a systematic basis during the period in which the related expenses are incurred.

V. Critical Accounting Judgments and Key Sources of Estimation and Uncertainty

The preparation of these parent only financial statements requires the management to make critical judgments in applying the Company’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Please see the following explanation of critical accounting judgments and key sources of estimation and uncertainty:

(I) Important judgments adopted by the accounting policies None.

~27~

Taiwan Mask Corp. Control Security C

• (II) Critical accounting estimates and assumptions

Evaluation of Inventories

The Company is primarily engaged in production and sale of photomask products in the semiconductor industry. Due to rapid technological innovations, short life-cycle and competition within the photomask industry, the risk of price fluctuations, Loss on decline in value of inventories and obsolescence is higher than that of other industries. The Company measures inventory based on the lower of cost and net realizable value. For inventories that are older than a certain period of inventory age or are outdated and obsolete, the Company must use judgment and estimation to determine the net realizable value of the inventory on the balance sheet date. The valuation of inventory may undergo major changes.

As of December 31, 2023, the book value of the Company’s inventory was NT$129,575.

VI. Summary of Significant Accounting Items

(I) Cash and Cash Equivalents

mary of Significant Accounting Items Cash and Cash Equivalents
Demand Deposit Time deposits Total	December 31, 2023 $ 421,288 30,705 $ 451,993	December 31, 2022
		$ 474,371 737,040 $ 1,211,411

1. The Company associates with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

2. The Company has no cash and cash and cash equivalents pledged to others.

(II) Financial assets and liabilities at fair value through profit or loss

Items Current items: Mandatory financial assets at fair value through profit or loss Shares of listed and OTC company Valuation adjustment Financial liabilities mandatorily measured at fair value through profit or loss Convertible bond call/put options Non-current items: Mandatory financial assets at fair value through profit or loss Shares of listed and OTC company Shares of non-listed and non-OTC company Valuation adjustment	December 31, 2023 $ 442,498 ( 45,158) $ 397,340 $ 9,383 $ 866,133 12,500 ( 18,671) $ 859,962	December 31, 2022 $ 442,498 ( 135,050) $ 307,448 $ 5,697 $ 866,133 - 58,873 $ 925,006

~28~

Taiwan Mask Corp. Control Security C

1. Details of financial assets/liabilities at fair value through profit or loss recognized in profit or loss are as follows:

loss are as follows:	loss are as follows:
Financial assets mandatorily measured at fair value through profit or loss Shares of listed and OTC company $ Shares of non-listed and non-OTC company ( Convertible bond call/put options ( $		2023 13,256 908) 3,686) 8,662	($ ( (	2022 211,992) 10,810) 10,697) 233,499)
	$		($

1. Please see Note 8 on how the Company provides financial assets at fair value through profit or loss as a pledged collateral.

2. Please see Note 12 (2) and (3) for the price risk and fair value information related to financial assets at fair value through profit or loss.

(III) Financial assets measured at amortized cost

Items Current items: Time deposits Non-current items: Time deposits Demand Deposit Total	December 31, 2023 $ 3,000 $ 43,954 373,550 $ 417,504	December 31, 2022 $ 3,000 $ 222,729 45 $ 222,774

1. Financial assets at amortized cost is recognized in the profit or loss shown as follows:

Interest income	$	2023 1,837	$	2022 246

1. While not considering the collaterals or other credit enhancements, the financial assets at amortized cost held by the Company had the maximum exposure of credit risk at NT$420,504 and NT$225,774 as of December 31, 2023 and 2022, respectively.

2. Please see Note 8 how the Company provides financial assets at amortized cost as a pledged collateral.

~29~

Taiwan Mask Corp. Control Security C

(IV) Notes and accounts receivable

Accounts Receivables Accounts Receivables－Related Parties Less: Loss allowance	December 31, 2023 $ 688,122 6,494 694,616 ( 2,324) $ 692,292	December 31, 2022 $ 802,337 9,525 811,862 ( 1,906) $ 809,956

1. Aging of accounts receivable is as follows:

Not past due Up to 30 days 31-90 days 91-180 days More than 181 days past due	$	December 31, 2023 Accounts Receivables Notes Receivables 575,140 $ - 88,263 - 28,821 - 2,090 - 302 - 694,616 $-	$	December 31, 2022 Accounts Receivables Notes Receivables 723,205 $ - 72,473 - 13,355 - 1,581 - 1,248 - 811,862 $-
	$		$

The above is an aging report based on the number of days past due.

1. As of December 31, 2023 and 2022, accounts receivable and notes receivable were from contracts with customers. The balances of notes and accounts receivable as of January 1, 2022 was NT$598,079.

2. While not considering the collaterals or other credit enhancements, the accounts receivable held by the Company had the maximum exposure of credit risk at NT$692,292 and NT$809,956, respectively, as of December 31, 2023 and 2022.

3. Please refer to Note 12 (2) for the information on credit risk of accounts receivable.

4. (V) Inventories

Raw materials Work in process Finished goods Total	$	Cost 103,921 26,609 3,839 134,369	December 31, 2023 (Gain from reversal of)	December 31, 2023 (Gain from reversal of)	$	Book value 99,127 26,609 3,839 129,575
			loss allowance on decline in market value
			($	of inventories 4,794) - - 4,794)
	$		($		$

~30~

Taiwan Mask Corp. Control Security C

Raw materials Work in process Finished goods Total	$	Cost 99,179 22,831 1,814 123,824	December 31, 2022 (Gain from reversal of)	December 31, 2022 (Gain from reversal of)	$	Book value 94,064 22,831 1,814 118,709
			loss allowance on decline in market value
			($	of inventories 5,115) - - 5,115)
	$		($		$

The cost of inventories recognized as losses by the Company.

Cost of goods sold Loss on falling prices of inventory and inventory obsolescence (gain from recovery) Loss on scrapping of inventory	(
	4,278
	$

For 2023 and 2022, part of the inventory for which the provision for impairment losses had been made in the previous period was sold and scrapped, resulting in a gain from recovery.

(VI) Investment under Equity Method

SunnyLake Park International Holdings, Inc. Youe Chung Capital Corporation Innova Vision INC. Advagene Biopharma Co., Ltd. Miracle Technology CO., LTD. Weida Hi-Tech Co., Ltd. ONE TEST SYSTEMS Pilot Battery Co., Ltd.	$

For information on the Company’s subsidiaries, please refer to Note 4 (3) of 2023 consolidated financial statements.

~31~

Taiwan Mask Corp. Control Security C

(VII) Property, plant and equipment

January 1, 2023 Cost Accumulated depreciation 2023 January 1 Additions Depreciation Reclassification - Cost Reclassification - Accumulated depreciation December 31 December 31, 2023 Cost Accumulated depreciation	Buildings and structures (including land) $ 1,884,128 ( 654,821) $ 1,229,307 $ 1,229,307 154,027 ( 171,556) 146,113 ( 9,230) $ 1,348,661 $ 2,184,268 ( 835,607) $ 1,348,661	Buildings and structures (including land) $ 1,884,128 ( 654,821) $ 1,229,307 $ 1,229,307 154,027 ( 171,556) 146,113 ( 9,230) $ 1,348,661 $ 2,184,268 ( 835,607) $ 1,348,661	Machinery and equipment $ 4,526,313 ( 1,615,533) $ 2,910,780 $ 2,910,780 2,501,097 ( 480,815) 157,313 - $ 5,088,375 $ 7,184,723 ( 2,096,348) $ 5,088,375	Machinery and equipment $ 4,526,313 ( 1,615,533) $ 2,910,780 $ 2,910,780 2,501,097 ( 480,815) 157,313 - $ 5,088,375 $ 7,184,723 ( 2,096,348) $ 5,088,375	Machinery and equipment $ 4,526,313 ( 1,615,533) $ 2,910,780 $ 2,910,780 2,501,097 ( 480,815) 157,313 - $ 5,088,375 $ 7,184,723 ( 2,096,348) $ 5,088,375	Office equipment $ 43,591 ( 24,094) $ 19,497 $ 19,497 12,261 ( 11,210) 260 - $ 20,808 $ 56,112 ( 35,304) $ 20,808	Transportation equipment $ 6,292 ( 3,425) $ 2,867 $ 2,867 2,165 ( 1,172) - - $ 3,860 $ 6,268 ( 2,408) $ 3,860	Transportation equipment $ 6,292 ( 3,425) $ 2,867 $ 2,867 2,165 ( 1,172) - - $ 3,860 $ 6,268 ( 2,408) $ 3,860	Other equipment $ 315,058 ( 79,963) $ 235,095 $ 235,095 193,715 ( 81,542) 42,413 - $ 389,681 $ 551,186 ( 161,505) $ 389,681	Unfinished construction and equipment to be inspected $ 364,782 - $ 364,782 $ 364,782 978,499 - ( 332,453) - $ 1,010,828 $ 1,010,828 - $ 1,010,828	Unfinished construction and equipment to be inspected $ 364,782 - $ 364,782 $ 364,782 978,499 - ( 332,453) - $ 1,010,828 $ 1,010,828 - $ 1,010,828	Total $ 7,140,164 ( 2,377,836) $ 4,762,328 $ 4,762,328 3,841,764 ( 746,295) 13,646 ( 9,230) $ 7,862,213 $10,993,385 ( 3,131,172) $ 7,862,213
		(
		( (			$ 2,910,780			$ 2,867
					$ 2,910,780 2,501,097 480,815) 157,313 -			$ 2,867 2,165 ( 1,172) - -			(
		(		$ 5,088,375 $ 7,184,723 ( 2,096,348) $ 5,088,375	$ 5,088,375			$ 3,860
								$ 6,268 ( 2,408)
					$ 5,088,375			$ 3,860

~32~

Taiwan Mask Corp. Control Security C

January 1, 2022 Cost Accumulated depreciation 2022 January 1 Additions Depreciation Reclassification - Cost Reclassification - Accumulated depreciation December 31 December 31, 2022 Cost Accumulated depreciation	Buildings and structures (including land) $ 1,692,966 ( 602,039) $ 1,090,927 $ 1,090,927 363,662 ( 140,346) ( 172,500) 87,564 $ 1,229,307 $ 1,884,128 ( 654,821) $ 1,229,307	Buildings and structures (including land) $ 1,692,966 ( 602,039) $ 1,090,927 $ 1,090,927 363,662 ( 140,346) ( 172,500) 87,564 $ 1,229,307 $ 1,884,128 ( 654,821) $ 1,229,307	Machinery and equipment $ 3,215,027 ( 1,304,734) $ 1,910,293 $ 1,910,293 1,280,116 ( 309,183) 31,170 ( 1,616) $ 2,910,780 $ 4,526,313 ( 1,615,533) $ 2,910,780	Machinery and equipment $ 3,215,027 ( 1,304,734) $ 1,910,293 $ 1,910,293 1,280,116 ( 309,183) 31,170 ( 1,616) $ 2,910,780 $ 4,526,313 ( 1,615,533) $ 2,910,780	Machinery and equipment $ 3,215,027 ( 1,304,734) $ 1,910,293 $ 1,910,293 1,280,116 ( 309,183) 31,170 ( 1,616) $ 2,910,780 $ 4,526,313 ( 1,615,533) $ 2,910,780	Office equipment $ 31,105 ( 16,357) $ 14,748 $ 14,748 12,159 ( 7,737) 327 - $ 19,497 $ 43,591 ( 24,094) $ 19,497	Transportation equipment $ 5,635 ( 2,581) $ 3,054 $ 3,054 657 ( 844) - - $ 2,867 $ 6,292 ( 3,425) $ 2,867	Transportation equipment $ 5,635 ( 2,581) $ 3,054 $ 3,054 657 ( 844) - - $ 2,867 $ 6,292 ( 3,425) $ 2,867	Other equipment $ 10,942 ( 1,248) $ 9,694 $ 9,694 24,528 ( 3,913) 279,588 ( 74,802) $ 235,095 $ 315,058 ( 79,963) $ 235,095	Unfinished construction and equipment to be inspected Total $ 149,749 $ 5,105,424 - ( 1,926,959) $ 149,749 $ 3,178,465 $ 149,749 $ 3,178,465 363,204 2,044,326 - ( 462,023) ( 148,171) ( 9,586) - 11,146 $ 364,782 $ 4,762,328 $ 364,782 $ 7,140,164 - ( 2,377,836) $ 364,782 $ 4,762,328	Unfinished construction and equipment to be inspected Total $ 149,749 $ 5,105,424 - ( 1,926,959) $ 149,749 $ 3,178,465 $ 149,749 $ 3,178,465 363,204 2,044,326 - ( 462,023) ( 148,171) ( 9,586) - 11,146 $ 364,782 $ 4,762,328 $ 364,782 $ 7,140,164 - ( 2,377,836) $ 364,782 $ 4,762,328	Total $ 5,105,424 ( 1,926,959)	Total $ 5,105,424 ( 1,926,959)
		(
		( (			$ 1,910,293								$ 3,178,465
					$ 1,910,293 1,280,116 309,183) 31,170 1,616)								$ 3,178,465 2,044,326 462,023) 9,586) 11,146
		(		$ 2,910,780 $ 4,526,313 ( 1,615,533) $ 2,910,780	$ 2,910,780			$ 2,867				$ 4,762,328 $ 7,140,164 ( 2,377,836)	$ 4,762,328
								$ 6,292 ( 3,425)
					$ 2,910,780			$ 2,867					$ 4,762,328

1. The Company had no interest capitalization in 2023 and 2022.

2. The major components of the Company’s houses and buildings include land, buildings and factory renovation projects. Except for land, they are depreciated for 5 to 56 years.

3. Information on property, plant and equipment pledged to others as collateral is provided in Note 8.

4. The abovementioned property, plant and equipment of the Company are for self-use.

~33~

Taiwan Mask Corp. Control Security C

(VIII) Leasing arrangements - lessee

1. The underlying assets leased by the Company include land, buildings and company vehicles, and the leasing contracts are typically made for periods of 3 to 20 years. Lease contracts are negotiated separately and include a variety of terms and conditions. There are no restrictions for the leased assets, except that they cannot be used as loan collaterals.

2. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Buildings and structures Transportation equipment (company vehicles) Other equipment Land Buildings and structures Transportation equipment (company vehicles) Other equipment	December 31, 2023 Book value $ 481,190 4,590 9,941 39,806 $ 535,527 2023 Depreciation $ 25,710 1,116 6,092 3,164 $ 36,082	December 31, 2023 Book value $ 481,190 4,590 9,941 39,806 $ 535,527 2023 Depreciation $ 25,710 1,116 6,092 3,164 $ 36,082	December 31, 2023 Book value $ 481,190 4,590 9,941 39,806 $ 535,527 2023 Depreciation $ 25,710 1,116 6,092 3,164 $ 36,082	December 31, 2022 Book value $ 506,900 71 9,063 25,404 $ 541,438 2022 Depreciation $ 24,679 936 5,092 1,855 $ 32,562	December 31, 2022	December 31, 2022	December 31, 2022
	$			$
	$			$
	$			$

1. For 2023 and 2022, the increases of right-of-use assets were NT$30,171 and NT$10,585, respectively. The decreases of right-of-use assets of the Company in 2023 and 2022 were NT$0 and NT$0, respectively.

2. The information on profit or loss items related to lease contracts is as follows:

Items affecting current profit and loss Interest expenses on lease liabilities $ Expenses for short-term lease contracts Lease of low-value assets	2023 7,046 $ 619 806	2022 6,787 - 945

1. The Company’s total cash outflow on leases for 2023 and 2022 was NT$41,590 and NT$37,469, respectively.

2. Options to extend or terminate leases

In determining lease terms, the Company into consideration all facts and circumstances that create economic incentives to exercise an option to extend or terminate leases. The assessment of lease period is reviewed if a significant event occurs which affects the assessment of options to extend or options not to terminate.

~34~

Taiwan Mask Corp. Control Security C

(IX) Leasing arrangements - lessor

1. The Company leases out assets such buildings. The lease contracts are typically made for periods of 1 to 5 years. The terms of lease contracts are negotiated separately and include various terms and conditions. In order to preserve the condition of leased assets, the Company usually requires lessees not to pledge the underlying leased assets.

2. The Company recognized rental income of NT$138,419 and NT$141,022 based on operating lease contracts in 2023 and 2022, respectively, and none of the lease contracts were variable lease payments.

3. The maturity analysis of the lease payments under the operating leases is as follows:

(X)	2023 2024 2025 Total Real estate investment January 1, 2023 Cost Accumulated depreciation 2023 January 1 Reclassification - Cost Reclassification - Accumulated depreciation Depreciation December 31 December 31, 2023 Cost Accumulated depreciation	December 31, 2023 $ - 71,264 26,577 $ 97,841	December 31, 2022 $ 83,026 37,049 26,577 $ 146,652 Buildings and structures $ 770,879 ( 87,133) $ 683,746 $ 683,746 ( 13,934) 9,230 ( 16,188) $ 662,854 $ 756,945 ( 94,091) $ 662,854	December 31, 2022 $ 83,026 37,049 26,577 $ 146,652 Buildings and structures $ 770,879 ( 87,133) $ 683,746 $ 683,746 ( 13,934) 9,230 ( 16,188) $ 662,854 $ 756,945 ( 94,091) $ 662,854
			$
			$ ( (
			$
			$ (
			$

~35~

Taiwan Mask Corp. Control Security C

January 1, 2022 Cost Accumulated depreciation 2022 January 1 Reclassification - Cost Reclassification - Accumulated depreciation Depreciation December 31 December 31, 2022 Cost Accumulated depreciation	$ (	Buildings and structures 761,409 57,456) 703,953 703,953 9,470 11,146) 18,531) 683,746 770,879 87,133) 683,746
	$
	$ ( (
	$
	$ (
	$

1. Rental income and direct operating expenses of investment real estate:

Rental income from investment property Direct operating expenses incurred by investment properties that generate rent income in the period	$	2023 138,419 18,744	$	2022 91,063
	$		$	19,305

1. The fair value of the investment property held by the Company as of December 31, 2023 and 2022 were NT$1,854,899and NT$1,177,524, respectively. They were valuated using the income method and were of Level 3 fair value, and the major assumptions are as follows:

	December 31, 2023	December 31, 2022
Discount rate	3.75%	7.09%
Annual rent (net income)	$ 119,675	$ 87,708
Number of years	31~56	45~50

1. No capitalization of interest for investment property in 2023 and 2022.

2. As of December 31, 2023 and 2022, the investment properties had been used as collaterals. Please refer to Note 8.

~36~

Taiwan Mask Corp. Control Security C

(XI) Other Non-Current Assets

Prepayments for equipment Refundable deposit	December 31, 2023 $ 348,993 10,154 $ 359,147	December 31, 2022 $ 1,322,877 8,723 $ 1,331,600

(XII) Short Term Loans

Type of borrowings Bank borrowings Credit loan Secured borrowings Type of borrowings Bank borrowings Credit loan	December 31, 2023 Range of interest rate Collateral $ 919,983 0.88%～2.26% None 160,000 1.96% Shares of listed and OTC company $ 1,079,983 December 31, 2023 Range of interest rate Collateral $ 1,054,934 1.06%~4% None
	$

The interest expenses recognized in profit and loss in 2023 and 2022 were NT$25,937 and NT$24,652, respectively.

(XIII) Other Payables

Payable on machinery and equipment Director and supervisor remuneration and employee bonus payable Payroll and bonus payable Machine maintenance payable Others	December 31, 2023 $ 238,389 92,000 64,314 44,906 229,971 $ 669,580	December 31, 2022 $ 105,604 120,000 51,825 51,362 191,382 $ 520,173

~37~

Taiwan Mask Corp. Control Security C

(XIV) Corporate bonds payable

Corporate bonds payable Less: Amount of exercised conversion options Less: Discount on corporate bonds payable Less: Corporate bonds matured in one year or a business cycle or have the put option exercised	December 31, 2023 $ 3,800,000 ( 324,400) ( 51,000) 3,424,600 - $ 3,424,600	December 31, 2022 $ 3,000,000 ( 324,400) ( 66,556) 2,609,044 - $ 2,609,044

1. The terms of issuance for the Company’s 3rd domestic unsecured convertible bonds are as follows:

2. (1) The Company has been approved by the competent authority to raise and issue $2,000,000 of the 3rd domestic unsecured convertible bonds, with a coupon rate of 0% and an issuance period of 5 years from August 3, 2021 to August 3, 2026. The convertible bonds are repayable in cash at par value on maturity. The convertible bonds were listed for trading on August 3, 2021.

3. (2) The bondholders may request the conversion of the convertible bonds into the Company’s common shares at any time from the day after the expiration of three months from the date of issuance of the corporate bonds to the maturity date, except during the period when the transfer of the corporate bonds is suspended in accordance with the regulations or laws, and the rights and obligations of the converted common shares are the same as those of the original issued common shares.

4. (3) The conversion price of the convertible bonds is determined in accordance with the pricing model stipulated in the Measures, and the conversion price will be adjusted in accordance with the pricing model stipulated in the Conversion Measures in the event that the Company is subject to anti-dilution provisions. The conversion price will be reset on the base date set by the Regulations in accordance with the pricing model stipulated in the Conversion Measures. As of December 31, 2023, the conversion price was NT$82.4 per share.

5. (4) If the closing price of the Company’s common stock exceeds 30% of the then conversion price for 30 consecutive business days from the day following the third month of the issuance of the convertible bonds to the 40th business day prior to the expiration of the issuance period, the Company may redeem the outstanding corporate bonds within the next 30 business days at the par value of the corporate bonds in cash.

6. (5) If the outstanding balance of the convertible bonds is less than 10% of the total par value of the corporate bonds issued, the Company may redeem the convertible bonds at any time thereafter for cash at the par value of the corporate bonds, from the day following the third month of the issuance of the corporate bonds to the 40th business day prior to the expiration of the issuance period.

7. (6) As of December 31, 2023, a total amount of NT$324,400 had been converted into 3,733 thousand shares of common stock.

~38~

Taiwan Mask Corp. Control Security C

1. Upon issuance of convertible bonds, the Company separated the conversion options from the components of liabilities in accordance with IAS 32, “Financial Instruments: Presentation,” and recorded “capital surplus - stock options” at $406,616. The embedded repurchase and repurchase rights are separated from the principal contractual debt instruments in accordance with IFRS 9, “Financial Instruments”, because they are not closely related to the economic characteristics and risks of the principal contractual debt instruments, and are recorded as “financial assets or liabilities at fair value through profit or loss” on a net basis. The effective interest rate of the master contract debt after the separation was 0.0902%.

2. First series domestic secured corporate bonds

In order to raise the Company’s working capital, the board of directors resolved to approve on August 5, 2022 the issue of the first series domestic secured corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount of issue: According to the different issue conditions, there are two types of bonds, A and B, of which A is issued with an amount of $300,000, and B is issued with an amount of $200,000, totaling $500,000.

• (2) Issue period: Five years, issued on September 28, 2022, and matured on September 28, 2027.

• (3) Coupon rate and repayment method of principal and interest: Both Bond A and Bond B have a fixed annual coupon rate of 1.80%. Simple interest is calculated and paid once a year, and the principal is repaid in cash at the face value of the bond at maturity.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Second series domestic secured convertible corporate bonds

In order to raise the Company’s working capital, the board of directors resolved to approve on August 5, 2022 the issue of the second series domestic secured corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount of issuance: According to the different issue conditions, there are two types of bonds, A and B, of which A is issued with an amount of $200,000, and B is issued with an amount of $300,000, totaling $500,000.

• (2) Issue period: Five years, issued on December 27, 2022, and matured on December 27, 2027.

• (3) Coupon rate and repayment method of principal and interest: Bond A has a fixed annual coupon rate of 2.20% and Bond B has a fixed annual coupon rate of 2.38%. Simple interest is calculated and paid once a year, and the principal is repaid in cash at the face value of the bond at maturity.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Third series domestic secured convertible corporate bonds

In order to raise the Company’s working capital, the board of directors resolved to approve on August 4, 2023 the issue of the third series domestic secured corporate bond. The issue

~39~

Taiwan Mask Corp. Control Security C

has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount issued: NT$300,000 in total.

• (2) Issuance period: Five years from issuance on August 28, 2023 to expiration on August 28, 2028.

• (3) Coupon rate and method of repayment of principal and interest: The coupon rate is a fixed interest rate of 1.62% per annum, and the simple interest is calculated once a year. At maturity, the principal is repaid in cash based on the face value of the bond.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Fourth series domestic secured convertible corporate bonds

In order to raise the Company’s working capital, the board of directors resolved to approve on August 4, 2023 the issue of the fourth series domestic secured corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount issued: NT$500,000 in total.

• (2) Issuance period: Five years from issuance on December 12, 2023 to expiration on December 12, 2028.

• (3) Coupon rate and method of repayment of principal and interest: The coupon rate is a fixed interest rate of 1.8% per annum, and the simple interest is calculated once a year. At maturity, the principal is repaid in cash based on the face value of the bond.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

- (XV) Long term borrowings

		Range of
Type of	Borrowing period and payment	interest		December 31,
borrowings	method	rate	Collateral	2023
Long-term bank
borrowings
Secured	From December 28, 2021 to	2.55%	Buildings and	$ 1,000,000
borrowings	January 28, 2027, to be repaid in		structures and
	installments and installments		machine and
	over the agreed period		equipment
Secured	From December 27, 2021 to	2.25%~	Machinery and	900,000
borrowings	December 27, 2027, to be repaid	2.80%	equipment
	in installments and installments
	over the agreed period
Secured	From December 27, 2021 to	2.20%~	Buildings and	1,005,263
borrowings	December 27, 2032, to be repaid	2.55%	structures and
	in installments and installments		investment
	over the agreed period		properties

~40~

Taiwan Mask Corp. Control Security C

Type of borrowings Borrowing period and payment method Range of interest rate Collateral Other long-term borrowings Secured borrowings Repayable in portions and in installments during the term specified in the agreement from May 22, 2023 to May 31, 2027 3.58% Machinery and equipment Less: Long-term borrowings due within one year or one business cycle) Type of borrowings Borrowing period and payment method Range of interest rate Collateral Long-term bank borrowings Secured borrowings From December 28, 2021 to January 28, 2027, to be repaid in installments and installments over the agreed period 2.43% Buildings and structures and machine and equipment Secured borrowings From December 27, 2021 to December 27, 2024, repayable in portions and in installments during the term specified in the agreement 2.41% Buildings and structures Secured borrowings From December 27, 2021 to December 15, 2026, to be repaid in installments and installments over the agreed period 2.13% Machinery and equipment Secured borrowings From December 28, 2022 to December 27, 2032, repayable in portions and in installments during the term specified in the agreement 2.07% Buildings and structures and investment properties Secured borrowings From December 21, 2022 to December 21, 2027, to be repaid in installments and installments over the agreed period 2.68% Machinery and equipment Secured borrowings From December 27, 2022 to December 27, 2027, to be repaid in installments and installments over the agreed period 2.00% Machinery and equipment Less: Long-term borrowings due within one year or one business cycle)				December 31, 2023 560,000 -	December 31, 2023 560,000 -
	(				3,465,263 872,834) 2,592,429
		$
		December 31, 2022 $ 1,250,000 250,000 240,000 850,000 400,000 400,000 -
		(			3,390,000 484,737)
			$		2,905,263

~41~

Taiwan Mask Corp. Control Security C

(XVI) Pensions

1. (1) The Company operates a defined-benefit pension plan in accordance with the Labor Standards Act, which cover all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Labor Standards Act. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last six months prior to retirement. The Company contributes a monthly amount equal to 2% of employees’ monthly salaries and wages to a retirement fund at the Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is not enough to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company will make contribution for the deficit by the end of next March.

2. (2) The amounts recognized in the balance sheet are as follows:

Present value of defined benefit obligations Fair value of plan assets Defined Benefit Liabilities	December 31, 2023 ($ 22,650) 12,417 ($ 10,233)	December 31, 2022 ($ 21,153) 4,947 ($ 16,206)

~42~

Taiwan Mask Corp. Control Security C

(3) Changes in net defined benefit liabilities are as follows:

2023 Balance on January 1 ($ Current service cost Interest (expense) income( ( Re-measurements: Return on plan assets (excluding amounts included in interest income or expense) Change in financial assumptions ( Experience adjustments( ( Pension fund contribution Paid pension Balance on December 31($ 2022 Balance on January 1 ($ Current service cost ( Interest (expense) income( ( Re-measurements: Return on plan assets (excluding amounts included in interest income or expense) Change in financial assumptions Experience adjustments( ( Pension fund contribution Paid pension Balance on December 31($	($ (	Present value of defined benefit obligations 21,153) - 296) 21,449) - 251) 950) 1,201) - - 22,650) Present value of defined benefit obligations 22,595) 61) 169) 22,825) - 1,620 4,748) 3,128) - 4,800 21,153)		Fair value of plan	Fair value of plan	Defined Benefit Liabilities ($ 16,206) - ( 212) ( 16,418) 56 ( 251) ( 950) ( 1,145) 7,330 - ($ 10,233) Defined Benefit Liabilities ($ 15,450) ( 61) ( 107) ( 15,618) 407 1,620 ( 4,748) ( 2,721) 2,133 - ($ 16,206)
				$
	(
	( (
	(
	($			$
	($ ( (
				$	assets 7,145 - 62 7,207 407 - - 407 2,133 4,800) 4,947
	(					(
	(					(
	(					(
			(
	($			$		($

(4) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and the “Regulations for Revenues, Expenditures, Safeguard and

~43~

Taiwan Mask Corp. Control Security C

Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings are less than the aforementioned rates, government shall make payments for the deficit after being authorized by the Regulator. The Company has no right to participate in managing and operating the fund and hence the Company is unable to disclose the classification of fair value of plan asset in accordance with IAS19 paragraph 142. The composition of fair value of plan assets as of December 31, 2023 and 2022 is given in the Annual Labor Retirement Fund Utilization Report announced by the government.

• (5) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases	2023 1.3% 2.125%	2022 1.4% 2.125%

Assumptions for 2023 and 2022 regarding future mortality experience are set based on the Taiwan Standard Ordinary Experience Mortality Table.

Because the main actuarial assumption changes, the present value of defined benefit obligation is affected. The analysis is as follows:

December 31, 2023 Effect on present value of defined benefit obligation December 31, 2022 Effect on present value of defined benefit obligation	Discount rate Future salary increases 0.25% increase 0.25% decrease 0.25% increase 0.25% decrease ($ 637) $ 661 $ 640 ($ 620) ($ 631) $ 656 $ 636 ($ 616)	Discount rate Future salary increases 0.25% increase 0.25% decrease 0.25% increase 0.25% decrease ($ 637) $ 661 $ 640 ($ 620) ($ 631) $ 656 $ 636 ($ 616)	Discount rate Future salary increases 0.25% increase 0.25% decrease 0.25% increase 0.25% decrease ($ 637) $ 661 $ 640 ($ 620) ($ 631) $ 656 $ 636 ($ 616)
	($ 637) ($ 631)	$ 661 $ 656	$ 640 $ 636

The sensitivity analysis above analyzes the impact from changing one of the assumptions while others remain constant. In practice, more than one assumption may change all at once. The sensitivity analysis is the same with the method used to calculate the net pension liabilities of the balance sheet.

• (6) The expected contributions to the defined benefit pension plans of the Company for the year ending December 31, 2024 are NT$2,133.

• (7) As of December 31, 2023, the weighted average duration of the retirement plan is 12 years.

• (1) Starting July 1, 2005, the Company has established a retirement plan based on the

~44~

Taiwan Mask Corp. Control Security C

Labor Pension Act applicable to the domestic employees. Under the new plan, the Company contributes monthly an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

• (2) For 2023 and 2022, the pension costs recognized by the Company in accordance with the above mentioned pension measures were NT$14,779 and NT$12,196, respectively.

(XVII) Capital

1. As of December 31, 2023, the Company’s authorized capital was NT$5,000,000, consisting of 500,000 thousand shares (including 20,000 thousand shares which can be subscribed to as employee stock options). The paid-in capital was NT$2,564,465 with a par value of NT$10. All proceeds from shares issued have been collected.

The movements in the number of the Company’s common stocks outstanding are as follows:

Unit: Thousand shares

January 1 Conversion of convertible bonds Treasury stocks transfer to employees Treasury Stock Buyback Subsidiaries donated treasury stock December 31		2023 205,230 - 7,023 - 900 213,153	(	2022 214,107 773 - 10,000) 350 205,230

1. Treasury stock

(1) Reasons for repurchase of shares and changes in the quantity:

Company name of the shareholding Subsidiary - Youe Chung Capital Corporation The Company	Reasons for buyback		December 31, Number of shares (thousand) 35,831 7,462 43,293	December 31, Number of shares (thousand) 35,831 7,462 43,293	December 31,	December 31,	2023 Book value $ 509,891 664,593
				(thousand) 35,831 7,462 43,293
	Subsidiary holds the company’s stock Transfer shares to employees
							$1,174,484

~45~

Taiwan Mask Corp. Control Security C

Company name of the shareholding Subsidiary - Youe Chung Capital Corporation The Company	Reasons for buyback		December 31, Number of shares (thousand) 36,731 14,485 51,216	December 31,	December 31,	2022 Book value $ 522,698 1,256,281
	Subsidiary holds the company’s stock Transfer shares to employees
						$1,778,979

• (2) For 2023 and 2022, the Company’s share-based payment arrangements were as follows:

Type of arrangement Grant date Transfer of treasury stocks to employees 2022.01.26 Transfer of treasury stocks to employees 2023.04.19	Quantity granted Contract Period Vesting conditions 4,485Immediate vesting Note 10,000Immediate vesting Note

• Note: The Company grants treasury stocks to employees of the Company and its subsidiaries.

• (3) Remuneration costs related to the transfer of treasury stocks of the Company in 2023 and 2022 were NT$0 and NT$19,061, respectively.

• (4) The Securities and Exchange Act stipulates that the percentage of the Company’s repurchase of outstanding shares shall not exceed 10% of the Company’s total issued shares, and the total value of shares purchased shall not exceed the retained earnings plus the premium of issued shares and the amount of realized capital reserve.

• (5) The treasury stocks bought back by the Company in accordance with the Securities and Exchange Act shall not be pledged. Before transfer, shareholders are not entitled to the shareholders’ rights.

• (6) According to the provisions of the Securities and Exchange Act, the share repurchased to be transferred to employees shall be transferred within 5 years from the date of the purchase. If the transfer is not made within the time limit, the shares are deemed as unissued shares and a change of registration shall be made to cancel the shares. In order to maintain the Company’s credit and shareholders equity, the shares bought back should have the registration changed to cancel the shares within six months from the date of the purchase.

• (7) The Company’s stock held by the subsidiary Youe Chung Capital is treated as treasury stock. As of December 31, 2023 and 2022, Youe Chung Capital held 35,831 thousand and 36,731 shares, respectively, of the Company. The average book value per share was NT$14.23, and the fair value per share was NT$71.1 and NT$84.7, respectively. The cost of transferring treasury stocks is calculated based on the book value of the Company’s stock held by Youe Chung Capital and the Company’s indirect shareholding during each period.

~46~

Taiwan Mask Corp. Control Security C

• (8) On November 3, 2021, the Board of Directors resolved to purchase 6,000 thousand shares of the Company’s stock in the centralized trading market and transfer them to employees. This amount represented 2.37% of the total number of issued shares of the Company. The repurchase of 4,485 thousand shares was completed between November 4, 2021 and January 3, 2022. On January 21, 2022, the Board of Directors approved the transfer of 4,485 thousand shares to employees.

• (10) On May 6, 2022, the Board of Directors resolved to purchase 10,000 thousand shares of the Company’s stock in the centralized trading market and transfer them to employees. This amount represented 3.91% of the total number of issued shares of the Company. The repurchase of 10,000 thousand shares was completed between May 9, 2022 and July 8, 2022. On April 14, 2023, the Board of Directors approved the transfer of 10,000 thousand shares to employees, of which 7,023 shares were transferred to employees in June 2023.

(XVIII) Capital surplus

In accordance with the Company Act, any capital surplus arising from paid-in capital in excess of the par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the Securities and Exchange Act requires that the amount of capital surplus to be capitalized, as above, should not exceed 10% of paid-in capital each year. Capital reserves should not be used to cover accumulated deficit unless the legal reserve is insufficient. The following is a breakdown of the capital reserve:

Issue premiums January 1, 2023 $96,650 Distribution of cash from capital surplus ( 49,797) Adjustment of capital reserve by dividends paid to subsidiaries - Changes in ownership interests in subsidiaries recognized ( 2,705) Changes in shares of affiliates recognized under the equity method - Payment of overdue unclaimed dividends to shareholders - December 31, 2023 $44,148	Trading of treasury stock $768,509 - 90,829 - - - $859,338	Trading of	Changes in ownership interests in subsidiaries recognized $ 17,788 - - 136,309 - - $ 154,097	stock option $295,848 - - - - - $295,848	Affiliates Equity changes $ 68,427 - - - 13,793 - $ 82,220	Others $4,459 - - - - ( 151) $4,308	Total $1,251,681 ( 49,797) 90,829 133,604 13,793 ( 151) $1,439,959

~47~

Taiwan Mask Corp. Control Security C

Trading of treasury stock Issue premiums January 1, 2022$269,010 $695,046 $ Conversion of convertible bonds 68,829 - Distribution of cash from capital surplus (241,189) - Adjustment of capital reserve by dividends paid to subsidiaries - 73,463 Changes in ownership interests in subsidiaries recognized - - Changes in shares of affiliates recognized under the equity method - - Share-based payment transaction - - December 31, 2022 $96,650 $768,509 $	Trading of treasury stock Issue premiums January 1, 2022$269,010 $695,046 $ Conversion of convertible bonds 68,829 - Distribution of cash from capital surplus (241,189) - Adjustment of capital reserve by dividends paid to subsidiaries - 73,463 Changes in ownership interests in subsidiaries recognized - - Changes in shares of affiliates recognized under the equity method - - Share-based payment transaction - - December 31, 2022 $96,650 $768,509 $	Trading of treasury stock Issue premiums January 1, 2022$269,010 $695,046 $ Conversion of convertible bonds 68,829 - Distribution of cash from capital surplus (241,189) - Adjustment of capital reserve by dividends paid to subsidiaries - 73,463 Changes in ownership interests in subsidiaries recognized - - Changes in shares of affiliates recognized under the equity method - - Share-based payment transaction - - December 31, 2022 $96,650 $768,509 $	Changes in ownership interests in subsidiaries recognized 4,919 - - - 10,169 - 2,700 17,788	stock option $295,074 ( 13,357) - - - - 14,131 $295,848		Affiliates Equity changes	Others $4,459 - - - - - - $4,459	Total $1,315,828 55,472 ( 241,189) 73,463 10,169 21,107 16,831
						$ 47,320 - - - - 21,107 - $ 68,427
	$768,509	$						$1,251,681

(XIX) Retained earnings

1. According to the Articles of Incorporation, any surplus from profit concluded at the end of year by the Company is first subject to reimbursement of previous losses and payment of taxes, followed by 10% provision for legal reserve and provision or reversal of special reserve as the laws may require. Any earnings remaining shall be distributed as shareholders’ dividends in whole or partially.

2. The Company takes into account the overall business environment, industrial growth, and the Company’s long-term financial planning for stable operation and development to adopt a residual dividend policy, which is mainly based on the Company’s future capital budgeting plan to measure the annual capital needs. After using the retained earnings for funding, the remaining surplus will be distributed in the form of dividends, and the distribution steps are shown as follows:

3. (1) Decide on the best capital budgeting.

4. (2) Decide on the financing required for one of the capital budgeting items.

5. (3) Decide on the amount of the financing to be supported by retained earnings (methods such as cash capital increase or corporate bonds and so on can be adopted as support).

6. (4) After retaining the portion required for operation needs out of the earnings remainder, the rest should be distributed to shareholders in the form of dividends. Cash dividends distribution proportion should not be lower than 20% of the total amount of dividends for the distribution proportion of the Company’s dividends.

~48~

Taiwan Mask Corp. Control Security C

1. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of the legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

2. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

3. The Company’s Board meeting resolved on March 6, 2024 to distribute a cash dividend of NT$1.5 per common share from the 2023 earnings, with a total dividend of NT$373,477.

4. The Company’s board of directors resolved on May 24, 2023 to distribute a cash dividend of NT$2.30 per ordinary share from the 2022 surplus with a total dividend of NT$556,511. NT$0.20 per share is to be distributed from the capital surplus, with a total of NT$48,392. In addition, as the Company implemented the transfer of 7,023 thousand shares of treasury stock to employees, which changed the number of outstanding shares to 248,984 thousand shares, so the cash dividend was adjusted to $572,665 to be distributed from the capital surplus of $49,797.

5. The Company’s board of directors resolved on May 26, 2022 to distribute a cash dividend of NT$1.00 per ordinary share from the 2021 surplus with a total dividend of NT$255,674. NT$1.00 per share is to be distributed from the capital surplus, with a total of NT$255,674. In addition, as the Company implemented the repurchase of 14,485 thousand shares of treasury stock, which changed the number of outstanding shares to 241,189 thousand shares, so the cash dividend was adjusted to $241,189 to be distributed from the capital surplus of $241,189.

(XX) Other equity interests

January 1 Difference in foreign currency translation December 31 January 1 Difference in foreign currency translation December 31	2023 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 13,174 - ( 8,867) ($ 2,666) $ 4,307 2022 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 6,698 - 6,476 ($ 2,666) $ 13,174	2023 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 13,174 - ( 8,867) ($ 2,666) $ 4,307 2022 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 6,698 - 6,476 ($ 2,666) $ 13,174	2023 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 13,174 - ( 8,867) ($ 2,666) $ 4,307 2022 Unrealized gains and losses Foreign currency translation ($ 2,666) $ 6,698 - 6,476 ($ 2,666) $ 13,174	$ (	Total 10,508 8,867) 1,641 Total 4,032 6,476 10,508
				$
				$
		losses 2,666) - 2,666)
	($		$	$

~49~

Taiwan Mask Corp. Control Security C

(XXI) Operating income

Revenue from contracts with customers	2023 $ 3,985,541

1. Segmentation of revenue from contracts with customers

The Company derives its revenue from the transfer of goods and services either over time. The revenue can be divided into the following main product lines:

2023 Revenue from contracts with external customers Cut-off point of income recognition Income recognized gradually over time 2022 Revenue from contracts with external customers Cut-off point of income recognition Income recognized gradually over time	$	Photomask and semiconductor segment
		3,985,541 3,985,541 Photomask and semiconductor segment
	$
	$
		3,887,648 3,887,648
	$

1. Contract Asset and Contract Liability

2. (1) The Company has recognized the following revenue-related contract assets and contract liabilities:

Contract Assets Contract Liabilities	December 31, 2023	December 31, 2022 January 1, 2022 $ 90,642 $ 115,854 $ 57,323 $ 7,660
	$ 86,821 $ 33,984	$ 90,642 $ 57,323

• (2) Contract liabilities at the beginning of the period recognized as revenue of the period

Opening balance of contract liabilities recognized in the current period	$	2023 1,704	$	2022 2,986

~50~

Taiwan Mask Corp. Control Security C

(XXII) Interest income

(XXIII)	Interest from bank deposits Interest income from financial assets measured at amortized cost Other interest incomes Other Incomes	$	2023 25,360 1,837 119 27,316	$	2022 11,491 246 61
		$		$	11,798

(XXIV)	Rental income Dividend income Subsidy income Other income - Others Other Gains and Losses	$	2023 138,419 51,566 5,335 9,253 204,573	$	2022 141,022 33,682 12,343 8,340 195,387
		$		$

(XXV)	Loss on disposal of investments Foreign currency exchange gains (losses) Loss (gain) on financial assets/liabilities at fair value through profit or loss Other losses -- Depreciation of investment properties Other miscellaneous expenses Financial Costs Interest Expenses: Bank borrowings $ Convertible bonds Lease liabilities Others $	Loss on disposal of investments Foreign currency exchange gains (losses) Loss (gain) on financial assets/liabilities at fair value through profit or loss Other losses -- Depreciation of investment properties Other miscellaneous expenses Financial Costs Interest Expenses: Bank borrowings $ Convertible bonds Lease liabilities Others $	$ ( (		2023 - 636) 8,662 16,188) -	2023 - 636) 8,662 16,188) -	($ ( ( (
			($				($
				2023 111,935 43,376 7,046 49 162,406
		$				$

~51~

Taiwan Mask Corp. Control Security C

(XXVI) Expenses by nature

Employee benefits expenditure $ Depreciation expense (Note) Amortization expense Note: Including investment property and right-of- use assets	2023 516,888 $ 798,565 24,041	2022 467,529 513,116 6,284

(XXVII) Employee benefits expenditure

Payroll expenses Employee stock options Labor and health insurance fees Pension expense Other personnel expenses	$	2023 441,770 - 34,816 14,991 25,311 516,888	$	2022 395,385 14,131 29,229 12,364 16,420 467,529
	$		$

1. According to the Articles of Incorporation, the Company shall distribute not less than 10% of the current year’s profit situation for employee remuneration and not more than 2% of current year’s profit situation for director remuneration. However, profits must first be taken to offset against cumulative losses, if any.

2. For 2023 and 2022, employee remuneration was accrued at NT$80,000 and NT$102,000, respectively, and director remunerations was accrued at NT$12,000 and NT$18,000, respectively. The amounts were listed as payroll expenses.

The remuneration of employees and directors for 2023 and 2022 were estimated in accordance with the Articles of Incorporation taking into account the annual profit.

The 2022 employees’ and directors’ remuneration as resolved by the Board of Directors are consistent with the amounts recognized in the 2022 financial statements. Information about employees remuneration and director remuneration of the Company as resolved by the Board of Directors will be posted in the “Market Observation Post System”.

~52~

Taiwan Mask Corp. Control Security C

(XXVIII) Income tax 1. Income tax expense

Components of income tax expense:

2023 Current tax: Current tax on profits for the year $ 182,991 $ Additional surtax on undistributed earnings - Over provision of prior year’s income tax 70,339 Total current tax 253,330 Deferred income tax: Origination and reversal of temporary differences ( 7,161) Total Deferred Income Tax ( 7,161) Income Tax Expense $ 246,169 $ 2. Reconciliation between income tax expense and accounting profit	$	2022 189,639 - - 189,639 2,011 2,011 191,650
	$

Tax calculated based on profit before tax and statutory tax rate $ Impact tax deductibles of investment ( Fees excluded according to the tax law Tax-exempt income under the tax law ( Over provision of prior year’s income tax Income Tax Expense $	Tax calculated based on profit before tax and statutory tax rate $ Impact tax deductibles of investment ( Fees excluded according to the tax law Tax-exempt income under the tax law ( Over provision of prior year’s income tax Income Tax Expense $	2023 122,459 50,000) 113,684 10,313) 70,339 246,169	$ (	2022 179,034 - 23,042 10,426) - 191,650
	$		$

~53~

Taiwan Mask Corp. Control Security C

1. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:

Temporary differences: - Deferred income tax assets: Pension liabilities Loss on inventory Unrealized exchange Subtotal - Deferred income tax liabilities: Unrealized gain on exchange Total Temporary differences: - Deferred income tax assets: Unrealized exchange loss Subtotal - Deferred income tax liabilities: Unrealized gain on exchange Total

2023 January 1 Recognized in profit or loss Recognized in other comprehensive income Recognized in equity December 31 $ - $ 2,047 $ - $ - $ 2,047 - 959 - - 959 loss1,780 524 - - 2,304 $ 1,780 $ 3,530 $- $- $ 5,310 ($ 3,850) $ 3,631 $- $- ($ 219) ($ 2,070) $ 7,161 $- $- $ 5,091 2022 January 1 Recognized in profit or loss Recognized in other comprehensive income Recognized in equity December 31 $- $ 1,780 $- $- $ 1,780 $- $ 1,780 $- $- $ 1,780 ($ 59) ($ 3,791) $- $- ($ 3,850) ($ 59) ($ 2,011) $- $- ($ 2,070)

1. Deductible temporary difference not recognized as deferred income tax assets

Deductible temporary difference	December 31, 2023 $ 100,350	December 31, 2022 $ 105,407	December 31, 2022

1. The Company’s income tax returns through 2021 have been assessed and approved by the tax authority.

~54~

Taiwan Mask Corp. Control Security C

(XXIX) Earnings per share

Earnings per share Profit attributable to ordinary shareholders Diluted Earnings per share Profit attributable to ordinary shareholders Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee remuneration Profit attributable to ordinary shareholders plus assumed conversion of all dilutive potential ordinary shares Earnings per share Profit attributable to ordinary shareholders Diluted Earnings per share Profit attributable to ordinary shareholders Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee remuneration Profit attributable to ordinary shareholders plus assumed conversion of all dilutive potential ordinary shares	Amount after tax $ 366,126 $ 366,126 14,029 - $ 380,155 Amount after tax $ 703,519 $ 703,519 14,422 -		2023 Weighted average share outstanding (thousand shares) 209,180 209,180 20,335 1,331 230,846 2022 Weighted average share outstanding (thousand shares) 208,572 208,572 19,713 1,473 229,758		Earnings per
					share (NTD) $ 1.75 $ 1.65 Earnings per
					share (NTD) $ 3.37 $ 3.12
	$ 717,941

The weighted average number of shares outstanding in 2023 and 2022 has deducted the number of shares held by the Company and the subordinate company Youe Chung Capital deemed as the Company’s treasury stock (the number of shares is based on the Company’s shareholding).

~55~

Taiwan Mask Corp. Control Security C

(XXX) Supplemental cash flow information

Investing activities with partial cash payments:

Purchase of property, plant and equipment Add: Opening balance of payable on equipment Prepayments for equipment at the end of the period Less: Ending balance of payable on equipment Prepayments for equipment at the beginning of the period Cash paid during the year	2023 $ 3,841,764 105,604 348,993 ( 240,893) ( 1,322,877) $ 2,732,591	2022 $ 2,044,326 44,545 1,322,877 ( 105,604) ( 643,858) $ 2,662,286

(XXXI) Changes in liabilities arising from financing activities

January 1, 2023 Change in cash flow from financing activities Interest Incomes Interest Paid Other Non-Cash Transactions December 31, 2023 January 1, 2022 Change in cash flow from financing activities Interest Incomes Interest Paid Other Non-Cash Transactions December 31, 2022	Short Term Loans $1,054,934 25,049 - - - $1,079,983 Short Term Loans $ 860,000 194,934 - - - $1,054,934	Corporate bonds payable Long-term borrowings (including current portion) Lease liabilities $2,609,044 $ 3,390,000 $549,323 797,338 75,263 ( 33,119) 43,376 - 7,046 ( 20,540) - ( 7,046) ( 4,618) - 30,171 $3,424,600 $ 3,465,263 $546,375 Corporate bonds payable Long-term borrowings (including current portion) Lease liabilities $1,657,049 $2,650,000 $ 568,475 997,095 740,000 ( 29,737) 18,103 - 6,787 - - ( 6,787) ( 63,203) - 10,585 $2,609,044 $3,390,000 $ 549,323	Corporate bonds payable Long-term borrowings (including current portion) Lease liabilities $2,609,044 $ 3,390,000 $549,323 797,338 75,263 ( 33,119) 43,376 - 7,046 ( 20,540) - ( 7,046) ( 4,618) - 30,171 $3,424,600 $ 3,465,263 $546,375 Corporate bonds payable Long-term borrowings (including current portion) Lease liabilities $1,657,049 $2,650,000 $ 568,475 997,095 740,000 ( 29,737) 18,103 - 6,787 - - ( 6,787) ( 63,203) - 10,585 $2,609,044 $3,390,000 $ 549,323	Long-term borrowings (including current portion) 3,390,000 75,263 - - -	Long-term borrowings (including current portion) 3,390,000 75,263 - - -	Lease liabilities $549,323 ( 33,119) 7,046 ( 7,046) 30,171	Lease liabilities $549,323 ( 33,119) 7,046 ( 7,046) 30,171	Lease liabilities		Guarantee Deposits Received $ 33,874 87 - - -	Total liabilities arising from financing activities $ 7,637,175 864,618 50,422 ( 27,586) 25,553 $ 8,550,182 Total liabilities arising from financing activities $ 5,740,329 1,931,361 24,890 ( 6,787) ( 52,618) $ 7,637,175
				3,465,263			$546,375			$ 33,961 Guarantee Deposits Received $ 4,805 29,069 - - - $ 33,874	$
				Long-term orrowings
		payable $1,657,049 997,095 18,103 - ( 63,203) $2,609,044
			$3,390,000		$ 549,323						$

~56~

Taiwan Mask Corp. Control Security C

VII. Related Party Transactions

(I) Related parties’ names and relationship

Name of the related parties Relationship with the Company Miracle Technology CO., LTD. Subsidiary

Miracle Technology CO., LTD. Subsidiary Youe Chung Capital Corporation Subsidiary Innova Vision INC. Subsidiary Aptos Technology INC. 2nd-tier subsidiary Miracle International Enterprise(Shanghai) Co., 2nd-tier subsidiary Ltd. One Test Systems Subsidiary Xsense Technology Corporation 2nd-tier subsidiary (Note 1) Xsense Technology Corporation (B.V.I.) Taiwan 2nd-tier subsidiary (Note 1) Branch Digital-Can Tech. Co., Ltd. 2nd-tier subsidiary ADL Energy Corp 2nd-tier subsidiary Pilot Battery Co., Ltd. Subsidiary Weida Hi-Tech Co., Ltd. Affiliates Image Match Design Inc. Other related party (Note 2) BKS Tec Corp. Other related party Taiwan Mask Charity Foundation Other related party

• Note 1: Xsense Technology Corporation underwent a physical capital reduction in November 2022, leaving only 1 share held by Youe Chung Capital Corporation; at the same time, Xsense Technology Corporation applied to have the shares of Xsense Technology Corporation (B.V.I.) Taiwan Branch it held transferred to the original shareholders of Xsense Technology Corporation according to the original shareholding percentage; as of December 31, 2023, Youe Chung Capital Corporation held 100% equity of Xsense Technology Corporation and 53.00% of Xsense Technology Corporation (B.V.I.) Taiwan Branch.

• Note 2: Image Match Design Inc. re-elected it directors on June 1, 2023. Youe Chung Capital Corporation is no longer a director of the company, and the company is not a related party of the Company.

~57~

Taiwan Mask Corp. Control Security C

(II) Significant transactions with the related parties

1. Operating revenue

Product sales: Subsidiary 2nd-tier subsidiary Affiliates Other related party	$	2023 11,716 23,415 1,336 - 36,467	$	2022 14,828 17,609 7,066 1,169 40,672
	$		$

There are no major abnormalities in the transaction prices and payment terms of the related party compared to that of non-related parties.

1. Account receivable from related parties

Accounts Receivables: Subsidiary 2nd-tier subsidiary Affiliates Subtotal Other receivables: Subsidiary 2nd-tier subsidiary Other related party Subtotal Total	December 31, 2023 $ 1,629 4,865 - 6,494 29,161 61,372 407 90,940 $ 97,434	December 31, 2022 $ 5,221 3,978 326 9,525 7,421 10,022 - 17,443 $ 26,968

3. Other Payables - Related Parties

Other payables - acquisition of real property: 2nd-tier subsidiary Other Payables: 2nd-tier subsidiary Subtotal Total	December 31, 2023 $ 2,505 1,626 4,131 $ 4,131	December 31, 2022
		$ - - - $-

~58~

Taiwan Mask Corp. Control Security C

4. Acquisition of other assets

2nd-tier subsidiary	Account item Fixed assets	2023 Acquisition price $ 163,637	2022 Acquisition price $ 32,884

1. Acquisition of financial assets 2023:

Subsidiary Subsidiary 2nd-tier subsidiary 2022: None.	Account item Investment under equity method Investment under equity method Investment under equity method	Number of shares acquired 940,000 1,020,000 3,600,000		2023 Acquisition price $ 124,031 $ 20,400 $ 180,000

6. Others

(1) Guarantee Deposits Received:	2023	2022
Subsidiary	$ 473	$	416
Other related party	118		95
	$ 591	$	511
(2) Rental income:	2023	2022
Subsidiary	$ 18,800	$ 21,577
2nd-tier subsidiary	101,527	102,104
Other related party	1,677		891
	$ 122,004	$ 124,572

The Company leases buildings to subsidiaries, 2nd-tier subsidiaries and other related parties. The lease contract period is from 2018 to 2031, and the rent is collected in accordance with the contract.

(3) Prepayments for equipment: 2nd-tier subsidiary	$	2023 20,894	$	2022 71,804

~59~

Taiwan Mask Corp. Control Security C

• (4) The Company issued cash dividends of NT$90,829 and NT$73,463 to Youe Chung Capital in 2023 and 2022, respectively.

• (5) In 2023 and 2022, the Company donated NT$2,685 and NT$4,416, respectively, in cash to the Taiwan Mask Charity Foundation.

(III) Compensation of key management personnel

Salary and short-term employee benefits Post-employment benefits	$	2023 28,344 108 28,452	$	2022 31,197 216
	$		$	31,413

VIII. Pledged Assets

Assets pledged by the Company as collateral are as follows:

Assets Time deposit (Recognized as financial assets at amortized cost) Demand deposit (Recognized as financial assets at amortized cost) Stocks of publicly traded and OTC companies (recognized as “Financial assets at fair value through profit or loss”) Buildings and structures Real estate investment Machinery and equipment and equipment under acceptance Office equipment	Book December 31, 2023 $ 43,954 373,550 626,858 594,621 662,854 2,846,465 2,702 $ 5,151,004	Book	value December 31, 2022 Purpose $ 222,729 Guarantee of cargo out of free trade zone and lease deposit 45 Short-term borrowings and corporate bond guarantee 640,740 Short Term Loans 608,646 Long-term Loans 683,746 Long-term Loans 2,213,811 Long-term borrowings 2,401 Long-term borrowings $ 4,372,118
		2023

IX. Significant Contingent Liabilities and Unrecognized Contract Commitments

(I) Contingencies

None.

~60~

Taiwan Mask Corp. Control Security C

(II) Commitments

1. Machine equipment maintenance contracts that have been signed but not yet paid

Machine maintenance	December 31, 2023 $ 44,906	December 31, 2022 $ 51,362

1. Capital expenditures that have been signed but not yet incurred

Property, plant and equipment	December 31, 2023 $ 980,980	December 31, 2022 $ 15,539

1. Lease agreement

Please see Note 6 (8) and (9)

X. Losses due to Major Disasters

None.

XI. Major Events after Financial Statement Date

1. The resolution of the Company’s Board on March 6, 2024 passed the appropriation of earnings. Please refer to Note 6 (19) for details.

2. On March 6, 2024, the Company’s Board of Directors resolved to acquire the common shares of TrueLight Corporation through private placement. The expected subscription quantity is 13,500 thousand shares for an investment amount of NT$410,400.

XII. Others

(I) Capital management

The Company’s objectives when managing capital are to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Company monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including “current and non-current borrowings” as shown in the parent only balance sheet) less cash and cash equivalents. Total capital is calculated as “equity” as shown in the parent only balance sheet plus net debt.

The Company’s strategy in 2023 and 2022 was to borrow long-term loans and issue corporate bonds to purchase machinery and equipment and obtain long-term working capital. For the years ended December 31, 2023 and 2022, the debt-to-capital ratios were as follows:

~61~

Taiwan Mask Corp. Control Security C

Total borrowings Less: Cash and cash equivalents Net debt Total equity Total capital Debt-to-equity ratio	December 31, 2023 $ 7,969,846 ( 451,993) 7,517,853 5,123,142 $ 12,640,995 59.47%	December 31, 2022 $ 7,053,978 ( 1,211,411) 5,842,567 4,546,920 $ 10,389,487 56.23%

(II) Financial instruments 1. Types of financial instrument

Financial assets Financial Liabilities at Fair Value Through Profit or Loss Mandatory financial assets at fair value through profit or loss Financial assets measured at amortized cost Cash and Cash Equivalents Financial assets measured at amortized cost Accounts receivable (Including related parties) Other account receivable (Including related parties) Refundable deposit Financial liabilities Financial liabilities at amortized cost Short Term Loans Accounts Payable Other accounts payable (Including related parties) Corporate bonds payable (Including related parties) Long-term borrowings (including current portion) Guarantee Deposits Received Lease liabilities	December 31, 2023 $ 1,257,302 $ 451,993 420,504 692,292 95,460 10,153 $ 1,670,402 December 31, 2023 1,079,983 117,596 673,711 3,424,600 3,465,263 33,961 $ 8,795,114 $ 546,375	December 31, 2022 $ 1,232,454 $ 1,211,411 225,774 809,956 22,009 8,723 $ 2,277,873 December 31, 2022 $ 1,054,934 109,004 520,173 2,609,044 3,390,000 33,874 $ 7,717,029 $ 549,323

~62~

Taiwan Mask Corp. Control Security C

1. Risk management policies

2. (1) The Company’s activities expose it to a variety of financial risks, including market risk (exchange rate, interest rate and price), credit risk and liquidity risk. The Company’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company’s financial position and performance.

3. (2) Risk management is carried out by the Company’s finance department under policies approved by the Board of Directors. Company’s finance department identifies, evaluates and hedges financial risks in close collaboration with the Company’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as currency exchange risk, interest rate risk, credit risk, the use of derivatives and non-derivative financial instruments and investment of excess liquidity.

4. Significant financial risks and degrees of financial risks

5. (1) Market risk

   • A. Foreign exchange risk

The Company’s operations involve certain non-functional currencies (the Company’s functional currency is the New Taiwan dollar (NTD), so it is subject to the impact of exchange rate fluctuation. The details of assets and liabilities denominated in foreign currencies whose values would be materially affected by exchange rate fluctuations are as follows:

December 31, 2023 (Foreign currency: functional currency) Foreign currency (in thousand) Exchange rate Financial assets Monetary items USD : NTD USD 24,952 30.705 $ JPY : NTD JPY 6,857 0.2172 Financial liabilities Monetary items USD : NTD USD 10,926 30.705 $ JPY : NTD JPY 836,916 0.2172 Euro : NTD EUR 359 33.980	Book value (NT$ in thousands) 766,154 1,489 335,484 181,778 12,192

~63~

Taiwan Mask Corp. Control Security C

December 31, 2022

(Foreign currency: functional currency) Foreign currency (in thousand) Financial assets Monetary items USD : NTD USD 44,731 JPY : NTD JPY 1,496 Financial liabilities Monetary items USD : NTD USD 3,422 JPY : NTD JPY 616,283	Book value Exchange rate (NT$ in thousands) 30.71 $ 1,373,703 0.2324 348 30.71 $ 105,090 0.2324 143,224

• B. Total exchange gain, including realized and unrealized gains from significant foreign exchange variations on monetary items held by the Company amounted to (NT$636) and N$47,090 for the years ended December 31, 2023 and 2022, respectively.

• C. The analysis of foreign currency risk due to significant exchange rate fluctuation is as follows:

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD JPY : NTD Financial liabilities Monetary items USD : NTD JPY : NTD Euro : NTD	2023 Sensitivity Analysis Fluctuation Effect on profit or loss Other comprehensive profit and loss affected 1% $ 7,662 $ - 1% 15 - 1% ($ 3,355) - 1% ( 1,818) - 1% ( 122)	2023 Sensitivity Analysis Fluctuation Effect on profit or loss Other comprehensive profit and loss affected 1% $ 7,662 $ - 1% 15 - 1% ($ 3,355) - 1% ( 1,818) - 1% ( 122)	2023 Sensitivity Analysis Fluctuation Effect on profit or loss Other comprehensive profit and loss affected 1% $ 7,662 $ - 1% 15 - 1% ($ 3,355) - 1% ( 1,818) - 1% ( 122)	2023 Sensitivity Analysis Fluctuation Effect on profit or loss Other comprehensive profit and loss affected 1% $ 7,662 $ - 1% 15 - 1% ($ 3,355) - 1% ( 1,818) - 1% ( 122)
		Effect on profit or loss $ 7,662 15 ($ 3,355) ( 1,818) ( 122)
			profit and loss
			$	affected - - - -
	1% 1% 1% 1% 1%

~64~

Taiwan Mask Corp. Control Security C

Fluctuation (Foreign currency: functional currency) Financial assets Monetary items USD : NTD 1% JPY : NTD 1% Financial liabilities Monetary items USD : NTD 1% JPY : NTD 1%	Fluctuation	2022 Sensitivity Analysis

Price risk

• A. The equity instruments owned by the Company exposing to the price risk are financial assets at fair value through profit or loss.

• B. The Company invests primarily in beneficiary certificates and equity instruments. The price of such equity instrument is subject to the uncertainty of the future value of investment target. If the price of such equity instrument increases or decreases by 1%, while all other factors remain unchanged, the net profit after tax affected by equity instruments at fair value through profit or loss after tax for 2023 and 2022 is an increase or decrease of NT$10,058 and NT$9,860, respectively.

Cash flow and fair value interest rate risk

• A. The Company’s interest rate risk mainly comes from long-term borrowings issued at floating rates, which exposes the Company to cash flow interest rate risk. For 2023 and 2022, the Company’s borrowings issued at floating rates were mainly denominated in New Taiwan Dollars.

• B. The Company’s borrowings are measured at amortized cost, and the annual interest rate is re-priced according to the contract, which exposes the Company to the risk of future market interest rate changes.

• C. If the long- and short-term borrowing rates increase or decrease by 0.25%, while all other factors remain constant, the net profit after tax for 2023 and 2022 is a decrease or increase of NT$9,090 and NT$8,890, respectively, mainly due to the interest expense changes caused by the floating interest rate.

• (2) Credit risk

• A. Credit risk refers to the risk of financial loss to the Company arising from default by the clients or counterparties of financial instruments under contract obligations, and the defaults are accounts receivable and the contract cash flow from debt instruments measured at amortized cost, measured at fair value through other comprehensive income and measured at fair value through profit or loss.

~65~

Taiwan Mask Corp. Control Security C

• B. The management of credit risk is established with a Company perspective. Only the banks and financial institutions with an independent credit rating of at least “A” can be accepted as transaction partners of the Group. According to the internal credit policy, each operating entity of the Company is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilization of credit limits is regularly monitored.

• C. The Company considers a contract payment overdue in accordance with the agreed payment terms a breach of contract.

• D. The Company uses IFRS 9 to provide the following assumption as a basis for determining whether there is a significant increase in the credit risk of financial instruments after the original recognition:

• (A) If the contract payment is overdue for more than 30 days in accordance with the agreed payment terms, the credit risk of the financial asset is significantly increased since the original recognition.

• (B) For bond investments in Taipei Exchange, if any external rating agency rates it as an investment grade on the balance sheet date, the credit risk of the financial asset is considered low.

• E. The Company uses the following indicators to determine the status of credit impairments of debt instruments:

• (A) The issuer has suffered significant financial difficulties or is likely to enter bankruptcy or other financial restructuring.

• (B) The issuer has suffered significant financial difficulties or is likely to enter bankruptcy or other financial restructuring.

• (C) The issuer delays or does not pay for the interest or principal.

• (D) Unfavorable changes in the national- or regional-level economic situation resulting in the issuer’s default.

• F. The Company categorizes the accounts receivable from customers based on the characteristics of trade credit risks. The simplified approach is adopted for estimating the expected credit loss based on the provision matrix.

• G. The Company may write off the amount of financial assets that cannot be reasonably expected to be recovered after recourse. However, the Company will continue the recourse to protect the rights of the claims.

• H. The Company has incorporated forward-looking considerations to adjust the loss rate built according to historic and current data in order to estimate the loss allowance of accounts receivables. The provision matrix for the years ended December 31, 2023 and 2022 are shown as follows:

~66~

Taiwan Mask Corp. Control Security C

		30 days past	31 to 90 days	91 to 180 days	181 to 360 days
	Not past due	due	past due	past due	past due	Total
December 31, 2023
Expected loss rate	0.01%	0.50%	5.27%	15.37%	64.93%
Total book value	$575,140	$ 88,263	$ 28,821	$ 2,090	$ 302	$694,616
Loss allowance	$ -	$ -	($ 1,442)	($ 731)	($ 151)	($ 2,324)
		30 days past	31 to 90 days	91 to 180 days	181 to 360 days
	Not past due	due	past due	past due	past due	Total
December 31, 2022
Expected loss rate	0.01%	0.20%	1.85%	5.23%	56.58%~100%
Total book value	$723,205	$72,473	$ 13,355	$ 1,581	$ 1,248	$811,862
Loss allowance	$ -	$ -	($ 729)	($ 554)	($ 623)	($ 1,906)

• I. The Company adopts a simplified method in which the loss allowance for the accounts receivable is shown as follows:

accounts receivable is shown as follows:
January 1 Recognize impairment loss December 31 January 1 Recognize impairment loss December 31	2023 Accounts Receivables
	$ 1,906 418 $ 2,324 2022 Accounts Receivables
	$ 1,085 821 $ 1,906

(3) Liquidity risk

• A. Cash flow forecasting is performed by the operating entities of the Company and aggregated by the Company’s finance department. It monitors rolling forecasts of liquidity requirements to ensure the Company has sufficient cash to meet operational needs.

• B. The remaining cash held by each operating entity will be transferred back to the Company’s finance department. The finance department of the Company invests the remaining funds in interest-bearing demand deposits, time deposits, financial assets at fair value through profit or loss, financial assets at amortized cost (time deposits with a maturity of more than 3 months and less than 12 months), as the instruments chosen have appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts. For the years ended December 31, 2023 and 2022, the position of money market held by the Company is at NT$451,993 and NT$1,214,411, respectively, and is expected to generate immediate cash flow to manage liquidity risk.

~67~

Taiwan Mask Corp. Control Security C

• C. The Company’s undrawn borrowing facilities are shown as follows:

Floating rate Mature within one year Maturity of more than 1 year	December 31, 2023 $ 1,141,826 - $ 1,141,826	December 31, 2022
		$ 255,100 120,000 $ 375,100

• D. The following table shows the Company’s non-derivative financial liabilities and derivative financial liabilities settled on a net or total amount, grouped according to the relevant maturity date. Non-derivative financial liabilities are analyzed based on the remaining period from the balance sheet date to the contract maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Non-derivative financial liabilities: December 31, 2023Within 1 year Non-derivative financial liabilities: Short Term Loans $ 1,105,920 Accounts Payable 117,596 Other accounts payable (Including related parties) 673,711 Lease liabilities 38,896 Corporate bonds payable 34,400 Long-term borrowings (including current portion) 953,532 Guarantee Deposits Received -	1 to 2 years $ - - - 35,466 34,400 822,570 33,961	2 to 5 years $ - - - 97,241 3,558,260 1,528,823 -	Over 5 years $ - - - 446,083 - 374,298 -

~68~

Taiwan Mask Corp. Control Security C

December 31, 2022 Non-derivative financial liabilities: Short Term Loans Accounts Payable Other Payables Lease liabilities Corporate bonds payable Long-term borrowings (including current portion) Guarantee Deposits Received	Within 1 year $ 1,054,934 109,004 520,173 36,293 - 496,418 -	1 to 2 years $ - - - 33,544 - 845,808 33,874	2 to 5 years $ - - - 89,277 2,696,140 175,591 -	Over 5 years $ - - - 469,121 - 1,664,852 -

(III) Fair value information

1. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

2. Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Company’s investment in stocks of publicly traded or OTC firms and beneficiary certificates is included in Level 1.

3. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

4. Level 3: Unobservable inputs for the asset or liability The fair value of the Company’s investment in stocks of non-publicly traded or non-OTC firms is included in Level 3.

5. Financial instruments not measured at fair value

6. Cash and cash equivalents, notes receivable, accounts receivable, other receivable, shortterm borrowings, notes payable, accounts payable and other payable as reasonable approximation of fair value.

~69~

Taiwan Mask Corp. Control Security C

1. The related information for financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities is as follows:

December 31, 2023 Assets Recurring fair value measurements Financial assets at fair value through profit or loss - Equity securities Liabilities Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Convertible bond call/put options December 31, 2022 Assets Recurring fair value measurements Financial assets at fair value through profit or loss - Equity securities Liabilities Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Convertible bond call/put options	Level 1 $1,190,010 $- Level 1 $1,153,154 $-	$	Level 2 67,292 - Level 2 79,300 -	$	Level 3 - 9,383 Level 3 - 5,697	Total $1,257,302 $ 9,383 Total $1,232,454 $ 5,697
		$		$
		$		$
		$		$

~70~

Taiwan Mask Corp. Control Security C

1. The methods and assumptions adopted by the Company for assessing the fair value are as follows:

2. (1) The Company adopt market pricing as the input of fair value (i.e. Level 1), and the breakdown of the characteristics of the instrument is as follows:

Shares of listed and OTC Open-end funds company Market price Closing price Net Value

• (2) Except for the abovementioned financial instruments with active markets, the fair value of the remaining financial instruments is obtained using valuation techniques. The fair value obtained through valuation techniques can refer to the current fair value of other financial instruments with similar substantive conditions and characteristics, discounted cash flow method, or other valuation techniques, including the use of market information available on the date of the parent only balance sheet (for example, the Taipei Exchange refers to the yield curve, the Reuters adopts the average quotation of interest rate of commercial promissory notes).

• (3) The output of the valuation model is the estimated value, and the valuation technique may not reflect all the relevant factors of the financial instruments and non-financial instruments held by the Company. Therefore, the estimated value of the valuation model will be appropriately adjusted according to additional parameters, such as model risk or liquidity risk. According to the Company’s fair value valuation model management policies and related control procedures, the management believes that in order to properly express the fair value of financial instruments and non-financial instruments in the parent only balance sheet, valuation adjustments are appropriate and necessary. The price information and parameters used in the valuation process are carefully assessed and appropriately adjusted according to current market conditions.

• (4) The Company incorporates credit risk valuation adjustments into the consideration of fair value of financial instruments and non-financial instruments to reflect counterparty credit risk and the credit quality of the Company, respectively.

• There were no transfers between Level 1 and 2 in 2023 and 2022.

• The following table shows the changes in Level 3 in 2023 and 2022:

January 1, 2023 Recognized in profit or loss December 31, 2023 January 1, 2022 Disposal this period Recognized in profit or loss December 31, 2022	Financial instruments
	($ 5,697) ( 3,686) ($ 9,383) Financial instruments
	$ 12,132 ( 7,132) ( 10,697) ($ 5,697)

~71~

Taiwan Mask Corp. Control Security C

1. The quantitative information about the significant unobservable input value of the valuation model and the sensitivity analysis of the significant unobservable input value change used in Level 3 fair value measurements are explained as follows:

December 31, 2023 Fair value Derivative equity / liability Convertible bond call/put options ($9,383) December 31, 2022 Fair value Derivative equity / liability Convertible bond call/put options (5,697)	Valuation technique Convertible bond evaluation model Valuation technique Convertible bond evaluation model	Significant unobservable inputs Stock price volatility Significant unobservable inputs Stock price volatility	Range (weighted average) 29.44% Range (weighted average) 50.65%	Relationship between
				inputs and fair value The higher the stock price volatility, the higher the fair value Relationship between
				inputs and fair value The higher the stock price volatility, the higher the fair value

1. The Company has carefully assessed the valuation models and parameters used to measure fair value. However, use of different valuation models or parameters may result in different measurement. For financial assets or liabilities classified in Level 3, changes in valuation parameters have the following impacts on the income or other comprehensive income of the period:

income of the period:
Inputs Changes Financial assets Debt Stock price fluctuation ± 1% Inputs Changes Financial assets Debt Stock price fluctuation ± 1%	December 31, 2023 Recognized in profit or loss Recognized in other comprehensive income Favorable changes Adverse changes Favorable changes Adverse changes $ 20 ($ 10) - - December 31, 2022 Recognized in profit or loss Recognized in other comprehensive income Favorable changes Adverse changes Favorable changes Adverse changes $ 20 ($ 20) - -

~72~

Taiwan Mask Corp. Control Security C

XIII. Supplementary Disclosure

(I) Significant transactions information

1. Loans to others: Please refer to Table 1.

2. Provision of endorsements and guarantees to others: Please refer to Table 2.

3. Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to Table 3.

4. Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million or 20% of the Company’s paid-in capital: None.

5. Acquisition of real estate exceeding NT$300 million or 20% of paid-in capital or more: None.

6. Disposal of real estate exceeding NT$300 million or 20% of paid-in capital or more: None.

7. Purchases or sales of goods from or to related parties reaching NT$100 million or 20% of paid-in capital or more: None.

8. Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: None.

9. Engaged in derivative trading: None.

10. Significant inter-company transactions during the reporting periods: Please refer to Table 4.

11. (II) Information on Reinvested Businesses

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to Table 5.

(III) Information on investments in Mainland China

Please see Table 6.

(IV) Information on Major Shareholders

Please see Table 7.

XIV. Segments Information

Not applicable.

~73~

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Cash and Cash Equivalents Schedule December 31, 2023

Taiwan Mask Corporation Cash and Cash Equivalents Schedule December 31, 2023	Taiwan Mask Corporation Cash and Cash Equivalents Schedule December 31, 2023
Schedule 1		Unit: NT$ Thousand
Item	Summary	Amount
Bank deposits
	Demand deposits - NTD	$	200,183
	- Foreign currencyUSD 7,152, exchange rate 30.705		219,587
	JPY 6,857, exchange rate 0.2172		1,489
	EUR 1, exchange rate 33.980		29
	Demand deposits - Foreign currencyUSD 1,000, exchange rate 30.705
	Duration: December 20, 2023 to
	January 05, 2024
	Range of interest rate: 5%		30,705
		$	451,993

Page1 , Schedule 1

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Accounts Receivable Schedule December 31, 2023

Unit: NT$ Thousand

Schedule 2 Customer Name Summary General customers Company F Company A Company B Company G Company H Company C Others Less: Allowance for bad debts Related party Miracle Technology Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Less: Allowance for bad debts	Unit: NT$ Thousand Amount Note $ 103,651 72,317 70,789 51,259 39,552 36,476 314,078 The balance of each separate account did not exceed 5% of this account. 688,122 Account balance that has been more than a year is $0 ( 2,324) 685,798 $ 1,629 4,865 6,494 Account balance that has been more than a year is $0 - $ 6,494

Page 1, Schedule 2

Taiwan Mask Corp. Control Security C

Schedule 3 Items Raw materials Work in process Finished goods Add: Loss on falling prices of inventory and inventory obsolescence	Taiwan Mask Corporation Inventories Schedule December 31, 2023 Amount Summary Cost Market price $ 103,921 $ 104,350 26,609 47,372 3,839 6,976 134,369$ 158,698 ( 4,794) $ 129,575	Unit: NT$ Thousand Note Net realizable value as the market value Net realizable value as the market value Net realizable value as the market value

Page 1, Schedule 3

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation

Financial assets schedule at fair value through profit and loss January 1 to December 31, 2023

Schedule 4

Unit: NT$ Thousand

Name Common stocks of United Microelectronics Corporation Common stock of China Steel Structure Co., Ltd. Common stocks of Avision Inc. through private placement. Common Stock of 3S Silicon Tech Inc. Convertible bond call/put options Total	Opening balance Number of Shares Book value 7,554,000 $ 307,448 14,334,000 845,706 10,000,000 79,300 - - - ( 5,697) $ 1,226,757	Increase this period Number of Shares Amount - $ 89,892 - - - - 1,000,000 12,500 - - $ 102,392	Increase this period Number of Shares Amount - $ 89,892 - - - - 1,000,000 12,500 - - $ 102,392	Increase this period Number of Shares Amount - $ 89,892 - - - - 1,000,000 12,500 - - $ 102,392	Decrease this period Number of Shares Amount - $ - - ( 53,036) - ( 23,600) - ( 908) - ( 3,686) ($ 81,230)	Decrease this period Number of Shares Amount - $ - - ( 53,036) - ( 23,600) - ( 908) - ( 3,686) ($ 81,230)	Number	Number
			$					of Shares
	7,554,000 14,334,000 10,000,000 - -	- - - 1,000,000 -			- - - - -		7,554,000 14,334,000 10,000,000 1,000,000 -
			$	102,392		($ 81,230)

Page 1, Schedule 4

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Schedule of Investments Changes Accounted for Using Equity Method January 1 to December 31, 2023

Schedule 5 Name SunnyLake Park International Holdings, Inc. Youe Chung Capital Corporation Innova Vision INC. Advagene Biopharma Co., Ltd. Miracle Technology CO., LTD. Weida Hi-Tech Co., Ltd. ONE TEST SYSTEMS Pilot Battery Co., Ltd. Total	Opening Balance Number of Shares Amount 3,120,000 $ 5,746 534,877,568 1,140,806 36,793,134 151,324 12,549,652 33,508 22,955,033 482,368 12,176,880 84,080 - $ 1,897,832	Increase in	investment for the	Increase (decrease) under equity method Amount (Note) Ending balance Ratio of Share Proportion Number of Shares ($ 63) 3,120,000 100.00% ( 153,423) 534,877,568 100.00% ( 29,073) 37,813,134 75.32% ( 534) 12,549,652 23.51% ( 10,272) 22,955,033 100.00% ( 57,999) 12,176,880 28.20% ( 2,699) 940,000 100.00% ( 101,409) 3,600,000 20.00% ($ 355,472)	Ending balance	Ending balance	Ending balance	$
		period Number of Shares Amount - $ - - - 1,020,000 20,400 - - - - - - 940,000 124,031 3,600,000 180,000 $ 324,431	period
						Ratio of Share Proportion	Ratio of
	3,120,000 534,877,568 36,793,134 12,549,652 22,955,033 12,176,880
				($

Note: Mainly the share of profit or loss of subsidiaries and affiliates accounted for using the equity method, the share of other comprehensive income, and the cash dividends received from investees.

Page 1, Schedule 5

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Property, Plant and Equipment Cost Changes Schedule January 1 to December 31, 2023

Unit: NT$ Thousand

Schedule 6 Items Buildings and structures (including land) Machinery and equipment Transportation equipment Office equipment Other equipment Unfinished construction and equipment to be inspected	Opening balance $ 1,884,128 4,526,313 6,292 43,591 315,058 364,782 $ 7,140,164	Increase this period $ 154,027 2,501,097 2,165 12,261 193,715 978,499 $ 3,841,764	Decrease this period $ - - ( 2,189) - - - ($ 2,189)	Reclassification for the year $ 146,113 157,313 - 260 42,413 ( 332,453) $ 13,646	Unit: NT$ Thousand Closing balance Guarantee or pledge Note $ 2,184,268 Yes 7,184,723 Yes 6,268 None 56,112 Yes 551,186 None 1,010,828 None $10,993,385

Page 1, Schedule 6

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation

Property, Plant and Equipment Accumulated Depreciation Changes Schedule January 1 to December 31, 2023

Schedule 7

Unit: NT$ Thousand

Items Buildings and structures Machinery and equipment Transportation equipment Office equipment Other equipment	Opening balance $ 654,821 1,615,533 3,425 24,094 79,963 $ 2,377,836	Increase this period Decrease this period $ 171,556 $ - 480,815 - 1,172 ( 2,189) 11,210 - 81,542 - $ 746,295 ($ 2,189)	Reclassification for the year Balance of the period Note $ 9,230 $ 835,607 - 2,096,348 - 2,408 - 35,304 - 161,505 $ 9,230 $ 3,131,172

Page 1, Schedule 7

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Right-of-Use Assets Schedule January 1 to December 31, 2023

Schedule 8 Items Land Buildings and structures Transportation equipment (company vehicles) Other equipment Total	Opening Balance $ 572,982 3,660 17,420 27,259 $ 621,321	Increase this period $ - 5,635 6,970 17,566 $ 30,171	Decrease this period $ - - - - $-	Balance at the end of period Note $ 572,982 9,295 24,390 44,825 $ 651,492

Unit: NT$ Thousand

Page 1, Schedule 8

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Right-of-Use Assets Accumulated Depreciation Schedule January 1 to December 31, 2023

Schedule 9 Items Land Buildings and structures Transportation equipment (company vehicles) Other equipment Total	Opening Balance $ 66,082 3,589 8,357 1,855 $ 79,883	Increase this period $ 25,710 1,116 6,092 3,164 $ 36,082	Decrease this period $ - - - - $-	Balance at the end of period Note $ 91,792 4,705 14,449 5,019 $ 115,965

Unit: NT$ Thousand

Page 1, Schedule 9

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Short-Term Borrowings Schedule December 31, 2023

Unit: NT$ Thousand

Schedule 10					Unit: NT$	Thousand
			Range of interest	Financing	Pledge or
Types of borrowings	DescriptionEnding balance	Contract Duration	rate	Amount	Guarantee	Remarks
Credit loan	$ 40,000	11.09.2023~02.07.2024	1.95%	$ 200,000	None
Credit loan	60,000	10.20.2023~04.20.2024	2.06%	100,000	None
Credit loan	50,000	12.20.2023~01.19.2024	2.05%	300,000	None
Credit loan	100,000	12.29.2023~03.29.2024	2.16%	100,000	None
Credit loan	70,000	11.28.2023~02.27.2024	2.26%	300,000	None
Credit loan	30,000	12.29.2023~03.19.2024	2.08%	60,000	None
Credit loan	30,000	12.20.2023~03.19.2024	2.12%	60,000	None
Credit loan	100,000	05.17.2023~05.17.2024	1.95%	100,000	None
Credit loan	200,000	12.04.2023~03.01.2024	1.75%	300,000	None
Credit loan	139,983	09.20.2023~06.17.2024	0.88%~2.08%	220,000	None
Credit loan	100,000	11.08.2023~01.05.2024	2.11%	100,000	None
Secured borrowings	160,000	12.25.2023~02.23.2024	1.96%	160,000	Yes	Stock
	$ 1,079,983

Page 1, Schedule 10

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation - Long Term Borrowings Schedule December 31, 2023

Schedule 11

Unit: NT$ Thousand

Creditor Summary King’s Town Bank Intermediate- and long-term secured loans Shanghai Commercial and Savings Bank Intermediate- and long-term secured loans King’s Town Bank Intermediate- and long-term secured loans Agricultural Bank of Taiwan Intermediate- and long-term secured loans Taishin International Bank Intermediate- and long-term secured loans Shanghai Commercial and Savings Bank Intermediate- and long-term secured loans Chailease Finance Co., Ltd. Intermediate- and long-term secured loans Chailease Finance Co., Ltd. Intermediate- and long-term secured loans Less: Mature within one year

Amount of borrowings Duration of contract Coupon rate Pledge or guarantee Remarks $ 1,000,000 01.28.2022~01.28.2027 2.55% Houses and buildings and machine and equipment 805,263 12.28.2022~12.28.2032 2.20% Buildings and investment property 320,000 12.21.2022~12.21.2027 2.80% Machinery and equipment 400,000 12.27.2022~12.27.2027 2.26% Machinery and equipment 200,000 12.27.2021~12.25.2024 2.55% Buildings and investment property 180,000 12.27.2022~12.25.2026 2.25% Machinery and equipment 280,000 05.22.2023~05.22.2027 3.58% Machinery and equipment 280,000 05.31.2023~05.31.2027 3.58% Machinery and equipment 3,465,263 ( 872,834) $ 2,592,429

Page 1, Schedule 11

Taiwan Mask Corp. Control Security C

Schedule 12 Items Photomask	Taiwan Mask Corporation Sales Income Schedule January 1 to December 31, 2023 Unit: NT$ Thousand Quantity Amount 63,905 pieces $ 3,985,541
	Quantity 63,905 pieces

Page 1, Schedule 12

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Operating Costs Schedule January 1 to December 31, 2023

Schedule 13 Items Direct raw materials Opening raw materials Incoming materials in the current period Closing raw materials Less: Transfer to expense Consumption in this period Direct labor Manufacturing expenses Manufacturing cost Add: Opening work-in-progress Less: Closing work-in-progress Cost of finished goods Add: Opening finished goods Less: Closing finished goods Cost of manufacturing and sales Other operating costs Loss on falling prices of inventory and inventory obsolescence (gain from recovery) Loss on scrapping of inventory Operating costs

Unit: NT$ Thousand Amount Note $ 99,179 678,558 ( 103,921) ( 41,161) 632,655 115,397 1,576,358 2,324,410 22,831 ( 26,609) 2,320,632 1,814 ( 3,839) 2,318,607 ( 321) 4,278 $ 2,322,564

Page 1, Schedule 13

Taiwan Mask Corp. Control Security C

		Taiwan Mask Corporation
	Manufacturing Expenses Schedule
		January 1 to December 31, 2023
Schedule 14				Unit: NT$ Thousand
Item	Summary	Amount		Remarks
Depreciation		$	658,076
Contract maintenance fee			416,871
Salaries expense			173,740
Utilities			84,216
				The balance of each
				separate account did not
Others			243,455	exceed 5% of this account.
		$ 1,576,358

Page 1, Schedule 14

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation Operating Expenses Schedule January 1 to December 31, 2023

Unit: NT$ Thousand

Schedule 15 Item Summary Marketing expenses: Shipping expenses Salaries expense Export declaration fee Sample fee Others Administrative Expenses: Depreciation Salaries expense Utilities Others Research and development expenses: Research and experiment fee Salaries expense Depreciation Material costs Others	Unit: NT$ Thous Amount Remarks $ 29,062 24,712 7,451 4,366 The balance of each separate account did not exceed 5% of this account. 9,905 $ 75,496 $ 89,719 77,121 16,786 The balance of each separate account did not exceed 5% of this account. 121,174 $ 304,800 $ 43,515 38,800 33,506 9,248 The balance of each separate account did not exceed 5% of this account. 26,946 $ 152,015

Page 1, Schedule 15

Taiwan Mask Corp. Control Security C

Schedule 16 Function Type Employee benefits expenditure Payroll expenses $ Employee stock options Labor and health insurance fees Pension expense Director remuneration Other employee benefit expenses Depreciation Amortization expense

Taiwan Mask Corporation Employee Benefits, Depreciation, Depletion and Amortization in the Current Period January 1 to December 31, 2023 Unit: NT$ Thousand 2023 2022 Operating costs Operating expenses Non-operating income and expenses Total Operating costs Operating expenses Non-operating income and expenses Total 289,137 $ 140,633 $ - $ 429,770 $ 256,622 $ 132,903 $ - $ 389,525 - - - - - 14,131 - 14,131 23,053 11,763 - 34,816 17,476 11,753 - 29,229 9,887 5,104 - 14,991 7,912 4,452 - 12,364 - 12,000 - 12,000 - 5,860 - 5,860 16,150 9,161 - 25,311 8,763 7,657 - 16,420 658,076 124,301 16,188 798,565 432,485 62,100 18,531 513,116 19,075 4,966 - 24,041 3,153 3,131 - 6,284

1. As of the end of the current period and the previous year , there were 463 and 379 employees, respectively, and there were 5 and 5 directors, respectively, who did not hold a concurrent employee position.

2. Stocks are listed on the Taiwan Stock Exchange or the Taipei Exchange and the following information is disclosed:

3. (1) Average employee benefit expenses for the current year were NT$1,102 thousand (“Total employee benefit expenses for the current year - total directors’ remuneration”/”Number of employees for the current year - number of directors who are not also employees”). Average employee benefit expenses for the previous year were NT$1,234 thousand (“Total employee benefit expenses for the previous year - total directors’ remuneration”/”Number of employees for the previous year - number of directors who are not also employees”).

Page 1, Schedule 16

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation

Employee Benefits, Depreciation, Depletion and Amortization in the Current Period (continued) January 1 to December 31, 2023

Schedule 16

Unit: NT$ Thousand

• (2) Average employee salary expense for the current year was NT$938 thousand (Total salary expense for the current year / “Number of employees for the current year - Number of directors who were not also employees”).

• Average employee salary expense for the previous year was NT$1,042 thousand (Total salary expense for the previous year / “Number of employees for the previous year - Number of directors who were not also employees”).

• (3) Change in average employee salary expense adjustment was (10%) (“Average employee salary expense for the current year - Average employee salary expense for the previous year”/ Average employee salary expense for the previous year)

• (4) The Company has an audit committee, so there is no supervisor’s remuneration.

• (5) The Company has established and regularly reviewed the policies, systems, standards and structure of performance appraisal and salary remuneration of directors and managerial officers according to the Remuneration Committee charter, and abided by the following rules:

• A. The performance evaluation of the directors and managerial officers and their salary and remuneration shall be considered in reference to the payment standard among industry peers and individual performances, in relevance to its reasonableness with the Company’s operations performance and future risks.

• B. Shall not lead directors and managerial officers to pursue salary and remuneration, engaging in risky conducts that outstrip the Company’s capacity to handle.

• C. The bonus proportion of short-term performance for directors and senior level managerial officers and partial changes to remuneration payment time shall be decided in consideration of the industrial characteristics and the nature of the Company’s business.

• (6) Directors’ remuneration and employee remuneration are subject to the Company’s Articles of Incorporation. The distribution shall be executed after the resolution approval at the Board meeting with more than two-thirds of directors attending and of more than half of the attending directors agreed and passed the resolution, and reported to the shareholders meeting.

• A. Employee remuneration: Allocated based on the Company’s operating condition, and is distributed based on employee’s position, performance, and tenure of service.

• B. Quarterly bonus: Allocated based on the Company’s operating condition, and is given as an incentive for achieving the set targets.

• C. Annual salary adjustment: Carried out in accordance with the Company’s operating condition. Annual salary adjustment: Carried out in accordance with the Company’s operating condition. The salary adjustment range takes into account the salary adjustment in the industry, domestic economic growth, price index, and individual performance appraisal.

Page 2, Schedule 16

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023

Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023
Table 1													Unit: NTD in thousand (Unless otherwise specified)
No. (Note 1)	Company that lent funds	Borrowing party	General ledger account	Related party?	Maximum Balance for the Period	Endingbalance	Amount ActuallyDrawn	Range of interest rate	Nature of loan	Amount of transacti on with borrower	Reason for short- term financing	Amount of recognized impairment loss		Collateral		Limit on loans granted to a single party	Ceiling on total loan granted	Note
														Name	Value
1 2 3 3 3 3 4	ADL Energy Corp Miracle Technology CO., LTD. Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Pilot Battery Co., Ltd.	Aptos Technology INC. Aptos Technology INC. Aptos Technology INC. Xsense Technology Innova Vision INC. Moment Semiconductor, Inc. Xsense Technology Corporation (B.V.I.) Taiwan Branch	Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables - Related Parties Other Receivables - Related Parties Other Receivables－ Related Parties	Y Y Y Y Y Y Y	$ 10,000 170,000 370,000 570,000 90,000 30,000 50,000	$ - 170,000 270,000 300,000 90,000 30,000 50,000	$ - 170,000 270,000 270,000 90,000 30,000 50,000	2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%	Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing	- - - - - - -	Business operations Working capital Working capital Working capital Working capital Working capital Working capital	- - - - - - -		Promissory note Promissory note Promissory note Promissory note Promissory note Promissory note Promissory note	170,000 270,000 300,000 90,000 30,000 50,000	$ 27,324 174,394 1,410,867 1,410,867 1,410,867 1,410,867 157,182	$ 34,155 174,394 1,410,867 1,410,867 1,410,867 1,410,867 157,182	Note 3 Note 4 Note 6 Note 6 Note 6 Note 6 Note 7

Note 1: The description of the number columns are as follows:

• (1) Fill in “0” for the issuer.

• (2) The investee company is numbered in sequence starting from the Arabic numeral 1 according to company type.

• Note 2: Amendment to the Procedures for Lending Funds to Others:

• (1) Total amount of loans: The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have business dealings with the Company, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, are not restricted by the abovementioned paragraphs. However, the total amount of loans and the amount of loans to a single party shall not exceed 50% of the Company’s net value.

• Note 3: Subsidiary - ADL Energy Corp Procedures for Lending Funds to Others:

• (1) The total loan amount shall not exceed 50% of the Company’s net value. However, for companies or businesses that have a short-term financing need, the loan amount of each individual borrowers shall not exceed 40% of the Company net value.

• (2) In addition to the provisions in (1), the loan amount of each individual borrower of companies or businesses that have business dealings with the Company shall not exceed the amount of transactions between the two parties. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

• (3) In addition to the provisions in (1), in which companies or businesses have a short-term financing need, and the loan amount of each individual borrowers not exceeding 40% of the Company net value, the financing amount refers to the accumulated balance of the company’s short-term financing.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, or loans to the Company from any overseas companies in which the Company holds, directly or indirectly, 100% of the voting shares are not restricted by paragraph 1, subparagraph 1. However, the total loan amount, limits for each individual borrower, and the period of loan should be specified. However, the total amount of funds to be loaned and the limits for individual borrowers should be set, and the period for which funds should be loaned should be clearly defined. The total amount of loans lent between the overseas companies or to the parent company and the limit for each limit are specified as follows:

  • I. The total amount loans to enterprises shall not exceed 50% of the Company’s net value. However, for companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed 40% of the Company net value.

  • II. For overseas companies that have business dealings with each other, the individual loan amount shall not exceed the amount of transactions between the two parties. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

Taiwan Mask Corp. Control Security C

III. If there is a need for short-term financing, the loan amount of each individual borrowers shall not exceed 40% of the company’s net value, and the financing amount refers to the accumulated balance of the short-term financing between overseas companies.

• (5) The highest balance for the current period is the amount resolved by the board.

Note 4: Subsidiary - Miracle Technology Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have business dealings with the Company, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, are not restricted by the abovementioned paragraphs. However, the total amount of loans and the amount of loans to a single party shall not exceed 50% of the Company’s net value.

Note 5: Subsidiary - Innova Vision Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) The loan amount of each individual borrower of companies or businesses that have business dealings with the Company shall not exceed the amount of transactions between the two parties in the past year. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties, and shall not exceed 20% of the Company’s net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

Note 6: Subsidiary - Youe Chung Capital Corporation Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have a short-term financing need, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

• Note 7: Subsidiary - Pilot Battery Co.,Ltd. Procedures for Lending Funds to Others:

The Company shall not loan funds to any of its shareholders or any other person except under the following circumstances:

• (1) Where an inter-company or inter-firm business transaction calls for a loan arrangement.

• (2) Where an inter-company or inter-firm short-term financing facility is necessary, provided that such financing amount shall not exceed 40% of the lender’s net worth.

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023

Table 2

Unit: NTD in thousand (Unless otherwise specified)

No. (Note 1) Endorser/guarantor Name of Company		Guaranteed Party	Guaranteed Party	Limit of endorsement and guarantee for a single enterprise (Note 3,4,5,6)	Maximum Balance of Endorsement/G uarantee for the Period	Ending Balance of Endorsement/G uarantee	Amount Actually Drawn	Amount of Endorsement/Gu arantee Collateralized by Properties	Ratio of Accumulated Endorsement/Guarante e to Net Equity per Latest Financial Statements	Maximum Endorsement/Guar antee Amount Allowable (Note 3,4,5,6)	Guarantee Provided by Parent Company to Subsidiary	Guarantee Provided by Subsidiary to Parent Company Guarantee Provided by Subsidiaries in Mainland China	Note
		Name of Company	Relationship (Note 2)
0 Taiwan Mask Corporation 1 ADL Energy Corp 2 Miko-China Enterprise (Shanghai) Co., Ltd. 3 Miracle Technology CO., LTD. 3 Miracle Technology CO., LTD. 4 Pilot Battery Co., Ltd.		Miracle Technology CO., LTD. Aptos Technology INC. Miracle Technology CO., LTD. Xsense Technology Aptos Technology INC. ADL Energy Corp	2 3 3 1 1 1	$ 229,550 20,493 392,131 174,394 174,394 157,182	$ 226,975 19,500 226,695 150,000 20,000 50,000	$ 214,935 - 224,165 150,000 20,000 30,000	$ - - 224,165 150,000 20,000 30,000	$ - - 224,165 150,000 20,000 30,000	4.43% 0.00% 57.17% 34.40% 4.59% 7.63%	$ 2,049,257 20,493 392,131 174,394 174,394 157,182	Y N N N N N	N N Y N Y N N N N N N N	Note 3 Note 4 Note 5 Note 6 Note 6 Note 7

Note 1: The description of the number columns are as follows:

• (1) Fill in “0” for the issuer.

• (2) The investee company is numbered in sequence starting from the Arabic numeral 1 according to company type.

• Note 2: The relationship between the guarantor and the guarantee are one of the seven types indicated below:

• (1) A company with which it does business.

• (2) A company in which the Company directly and indirectly holds more than 50% of the voting shares.

• (3) A company that directly and indirectly holds more than 50% of the voting shares in the Company.

• (4) Companies in which the Company holds, directly or indirectly, 90%, or more of the voting shares may make endorsements/guarantees for each other.

• (5) A company that is mutually insured by a contract between peers or co-founders based on the needs of the contracted work.

• (6) A company that is guaranteed by all contributing shareholders in proportion to their shareholdings due to a joint investment relationship.

• (7) Companies that are engaged in joint and several guarantees for the performance guarantee of pre-sale housing sales contracts in accordance with the regulations of the Consumer Protection Act.

• Note 3: The Company’s endorsement and guarantee practices for others provide that:

• (1) The total amount of the Company’s external endorsement guarantee shall not exceed 30% of the Company’s paid-in capital.

• (2) The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

• (3) Companies with which the Company has a parent-child relationship: The endorsement and guarantee for a single enterprise shall not exceed 10% of the Company’s paid-in capital and the company’s paid-in capital being endorsed and guaranteed.

• (4) The aggregate amount of the endorsement and guarantee of the Company and its subsidiaries as a whole shall not exceed 40% of the net worth of the Company, of which the endorsement and guarantee of a single subsidiary shall not exceed 20% of the net worth of the Company.

Note 4: Subsidiary - ADL Energy Corp Endorsement and Guarantee Procedures:

• (1) The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

• (2) The amount of the endorsement guarantee for a single enterprise shall not exceed 30% of the net value of the company’s most recent audited or reviewed financial statements.

• (3) The Company and its subsidiaries shall state in the shareholders’ meeting the necessity and reasonableness of any endorsement or guarantee of more than 50% of the net value of the Company’s most recent audited or reviewed financial statements.

Note 5: Miko-China Enterprise (Shanghai) Co., Ltd. Endorsement and Guarantee Procedures:

• The total amount of endorsement guarantee liability is limited to RMB 30 million, and the amount of endorsement guarantee for a single enterprise shall not exceed RMB 30 million; however, for the parent company that directly or indirectly holds, through a subsidiary, more than 50% of the common stock equity of a company, it may endorse up to its net value.

• Note 6: Subsidiary - Miracle Technology Co., Ltd. Endorsement and Guarantee Procedures:

• The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

• Note 7: Subsidiary - Pilot Battery Co.,Ltd. Endorsement and Guarantee Procedures:

The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) December 31, 2023

Table 3

Unit: NTD in thousand (Unless otherwise specified)

Company name of the shareholding	Marketable securities	Relationship with the marketable securities issuer	General ledger account				End of period	End of period	End of period	Note
					Number of shares	Book value		Ownership	Fair value
Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Jing Hao Investment Co., Ltd. Jingjing Investment Co., Ltd. Aptos Technology INC. ADL Energy Corp Miko-China Enterprise (Shanghai) Co., Ltd.	Common stocks of United Microelectronics Corporation Common stock of China Steel Structure Co., Ltd. Common stocks of Avision Inc. through private placement. Common Stock of 3S Silicon Tech Inc. Common stocks of United Microelectronics Corporation Common stocks of Microtek International Common stocks of Taiwan Mask Common stock of China Steel Structure Co., Ltd. Common stocks of EVERBRITE Technology Image Match Design Inc. B Current Impact Investment B Current Impact Investment Partnership Intellectual Property Innovation Corporation Partnership Fund Wisdom Capital Limited Partnership G-TECH ELECTRONICS LTD. Memchip Technology Co., Ltd. Common stocks of TOPFUN TECHNOLOGY INC. Franklin Templeton SinoAm Asia Pacific Balanced Fund-Accu. Beneficiary Certificate Common stocks of Shenzhen He Mei Jing Yi Semiconductor Technology Co., Ltd.	None None None None None None Parent company None None None The Company is a director of that company None None None None None None None None	Financial Assets at Fair Value Through Profit or Loss - Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial assets measured at fair value through other comprehensive income - Non Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Assets at Fair Value Through Profit or Loss - Non Current		7,554,000 14,334,000 10,000,000 1,000,000 5,680,000 40,966,000 35,831,440 24,999,000 12,798,000 378,000 1,000,000 500,000 - - 1,097,092 187,915 100,000 50,000 400,000	$ 397,340 792,670 55,700 11,592 298,768 929,928 2,547,615 1,382,445 540,076 2,925 10,000 5,000 20,000 55,000 - - - 500 20,770		0.06% 7.17% 4.61% 2.69% 0.05% 19.92% 13.97% 12.50% 19.99% 2.26% 10.00% - - - 8.08% 3.13% 12.27% - 0.31%	$ 397,340 792,670 55,700 11,592 298,768 929,928 2,547,615 1,382,445 540,076 2,925 10,000 5,000 20,000 55,000 - - - 500 20,770

Taiwan Mask Corp. Control Security C

Table 4

Taiwan Mask Corporation and Subsidiaries Significant inter-company transactions during the reporting periods January 1 to December 31, 2023

Unit: NTD in thousand (Unless otherwise specified)

Status of transaction

				Status of transaction	Status of transaction	Status of transaction	Status of transaction
No. (Note 1) Name of the counterparty	Counterparty	Relationship with the counterparty (Note 2)		General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note 3)
0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 2 Miko-China Enterprise (Shanghai) Co., Ltd.	Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle International Enterprise(Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Aptos Technology INC. Aptos Technology INC. Innova Vision INC. Innova Vision INC. Xsense Technology Xsense Technology Corporation (B.V.I.) Taiwan Branch Miracle Technology CO., LTD. Aptos Technology INC. Innova Vision INC. Xsense Technology Corporation (B.V.I.) Taiwan Branch Aptos Technology INC. Aptos Technology INC. Xsense Technology Xsense Technology Corporation (B.V.I.) Taiwan Branch Miracle International Enterprise(Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. Aptos Technology INC. Miracle Technology CO., LTD.	1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 3 3 3 3 3 3 3 3 3 3		Sales Endorsement and guarantee Accounts Receivables Rental income Sales Accounts Receivables Rental income Other Receivables Rental income Other Receivables Rental income Other Receivables Other Incomes Other Incomes Other Incomes Other Incomes Other receivables (loans of funds) Interest income Endorsement and guarantee Sales Sales Accounts Receivables Accounts Receivables Sales Endorsement and guarantee Endorsement and guarantee	11,716 214,935 1,629 2,626 23,415 4,865 52,812 35,350 16,174 28,883 48,697 26,021 1,912 2,490 2,587 1,391 170,000 4,590 150,000 2,308 70,257 1,082 1,470 7,391 20,000 224,165	Net 60 Same with other customers Net 60 Same with other customers Net 60 Net 60 Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Receipt and payment at an agreed time Receipt and payment at an agreed time Same with other customers Net 60 Net 30 Net 30 Net 60 Net 60 Same with other customers Same with other customers	0.16% 1.03% 0.01% 0.04% 0.33% 0.02% 0.73% 0.17% 0.22% 0.14% 0.68% 0.12% 0.03% 0.03% 0.04% 0.02% 0.81% 0.06% 0.72% 0.03% 0.98% 0.01% 0.01% 0.10% 0.10% 1.07%

Taiwan Mask Corp. Control Security C

Status of transaction

				Status of transaction	Status of transaction	Status of transaction	Status of transaction
No. (Note 1) Name of the counterparty	Counterparty	Relationship with the counterparty (Note 2)		General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note 3)
3 Sichuan Miracle Power Technology Co., Ltd. 4 Youe Chung Capital Corporation 4 Youe Chung Capital Corporation	Miko-China Enterprise (Shanghai) Co., Ltd. Aptos Technology INC. Aptos Technology INC.	3 3 3		Sales Other receivables (loans of funds) Interest income	7,912 270,000 7,148	Net 30 Receipt and payment at an agreed time Receipt and payment at an agreed time	0.11% 1.29% 0.10%
4 Youe Chung Capital Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 4 Youe Chung Capital Corporation Xsense Technology 3 4 Youe Chung Capital Corporation Innova Vision INC. 3 4 Youe Chung Capital Corporation Innova Vision INC. 3 4 Youe Chung Capital Corporation Moment Semiconductor, Inc. 3 5 Aptos Technology INC. Moment Semiconductor, Inc. 3 5 Aptos Technology INC. Moment Semiconductor, Inc. 3 6 ADL Energy Corp Taiwan Mask Corporation 2 7 Innova Vision INC. iPro Vision Inc. 3 7 Innova Vision INC. iPro Vision Inc. 3 8 Pilot Battery Co., Ltd. Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 8 Pilot Battery Co., Ltd. ADL Energy Corp 3 8 Pilot Battery Co., Ltd. Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 9 Digital-Can Tech. Co., Ltd. Taiwan Mask Corporation 2 9 Digital-Can Tech. Co., Ltd. Taiwan Mask Corporation 2 10 Xsense Technology Corporation (B.V.I.) Taiwan Branch Taiwan Mask Corporation 2 10 Xsense Technology Corporation (B.V.I.) Taiwan Branch Taiwan Mask Corporation 2 11 iPro Vision Inc. Innova Vision INC. 2			Other receivables (loans of funds) 270,000 Receipt and payment at an agreed time 1.29% Interest income 7,283 Receipt and payment at an agreed time 0.10% Other receivables (loans of funds) 90,000 Receipt and payment at an agreed time 0.43% Interest income 2,437 Receipt and payment at an agreed time 0.03% Other receivables (loans of funds) 30,000 Receipt and payment at an agreed time 0.14% Sales 13,420 Net 60 0.19% Accounts Receivables 1,440 Net 60 0.01% Sales 11,255 Net 60 0.16% Sales 31,780 Net 60 0.44% Accounts Receivables 36,655 Receipt and payment at an agreed time 0.18% Other receivables (loans of funds) 50,000 Receipt and payment at an agreed time 0.24% Endorsement and guarantee 30,000 Receipt and payment at an agreed time 0.14% Interest income 1,073 Receipt and payment at an agreed time 0.01% Sales 148,644 Net 60 2.06% Accounts Receivables 3,832 Net 60 0.02% Other Incomes 9,000 Receipt and payment at an agreed time 0.13% Other operating revenue 1,000 Receipt and payment at an agreed time 0.01% Sales 1,555 Receipt and payment at an agreed time 0.02%

Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

• (1) Parent company is “0”.

• (2) The subsidiaries are numbered in order starting from “1”.

Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between subsidiaries refer to the same transaction, it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction; for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction):

(1) Parent company to subsidiary.

• (2) Subsidiary to parent company.

(3) Subsidiary to subsidiaries.

Note 3: Only transactions with an amount of more than NT$1 million will be disclosed, and transactions with related parties will not be disclosed separately.

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries

Names, locations and other information of investee companies (not including investees in China) January 1 to December 31, 2023

Table 5

Unit: NTD in thousand (Unless otherwise specified)

Name of Investor	Investee	Location	Main business activities		Initial investment amount	Initial investment amount	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Net profit (loss) of the investee for the current period	Investment profit (loss) recognized for the current period	Note
					Balance at the end ofperiod	End of the previousyear	Number of shares	Owners hip	Book value
Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation	SunnyLake Park International Holdings, Inc. Youe Chung Capital Corporation Advagene Biopharma Co., Ltd. Miracle Technology CO., LTD. Weida Hi-Tech Co., Ltd. Innova Vision INC. ONE TEST SYSTEMS Pilot Battery Co., Ltd. Advagene Biopharma Co., Ltd. Xsense Technology Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch Aptos Technology INC. Innova Vision INC. Digital-Can Tech. Co., Ltd. Pilot Battery Co., Ltd.	British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan United States Taiwan Taiwan British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan	Re-investment Re-investment Medical, R&D, manufacturing Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Display panel control chip and other module’s research, design, development, manufacturing and sales Manufacturing, retail, wholesale and international trade of medical equipment Research, development and design of test equipment and related components Electronic parts and components and energy technical services Medical, R&D, manufacturing Precious metal coating Precious metal coating Design, packaging and testing of NAND flash memory, solid state drives and the related products Manufacturing, retail, wholesale and international trade of medical equipment 3D Printing and Plastic Mold Design Electronic parts and components and energy technical services		$ 103,045 1,260,000 165,691 252,651 293,371 598,721 121,372 180,000 75,021 325,965 - 434,692 151,533 139,072 178,500	$ 103,045 1,260,000 165,691 252,651 293,371 578,321 - - 60,021 325,965 - 434,692 151,533 139,072 -	3,120,000 534,877,568 12,549,652 22,955,033 12,176,880 37,813,134 940,000 3,600,000 3,216,223 1 12,189,191 28,481,161 94,370 7,281,250 7,000,000	100% 100% 23.51% 100% 28.20% 75.32% 100% 20.00% 6.03% 100.00 % 53.00% 47.19% 0.19% 57.39% 38.89%	$ 5,683 987,383 32,974 472,096 26,081 142,651 121,332 78,591 8,451 6,247 (3,294) (221,433) 449 106,507 249,031	($ 64) (810,367) (91,817) 17,169 (210,648) (178,674) 5,823 (58,757) (91,817) (72) 10,768 (274,014) (178,674) (4,253) (58,757)	($ 64) (347,421) (22,792) 17,169 (57,935) (165,774) 6 (2,463) (5,062) (72) 2,175 (129,303) (405) (7,351) (30,513)	Note 2

Taiwan Mask Corp. Control Security C

Name of Investor	Investee	Location	Main business activities		Initial investment amount	Initial investment amount	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Net profit (loss) of the investee for the current period	Investment profit (loss) recognized for the current period	Note
					Balance at the end ofperiod	End of the previousyear	Number of shares	Owners hip	Book value
Youe Chung Capital Corporation Aptos Technology INC. Aptos Technology INC. Aptos Technology INC. ADL Energy Corp Miracle Technology CO., LTD. Jingjing Investment Co., Ltd. Innova Vision INC.	Moment Semiconductor, Inc. New Sunrise Limited ONE TEST SYSTEMS ADL Energy Corp Aptos Global Holding Corp. Jingjing Investment Co., Ltd. Miko Technology Co., Ltd Innova Technology	Taiwan Samoa United States Taiwan Seychelles Taiwan Hong Kong Taiwan	Retail and wholesale of memory products Re-investment Research, development and design of test equipment and related components Electronic parts and components and energy technical services Re-investment Re-investment Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Sales of contact lens		40,000 - - 29,795 10,012 37 64,650	- - - 413,050 29,795 10,012 37 64,650	4,000,000 - - 10,000,000 25,860,907 10,000 3,000,000	53.33% 100% 0% 0% 100% 100% 100% 100%	29,910 - - - - 321,670 6,719 (3,396)	(24,327) - 5,823 20,396 - 43,005 (20) (58)	(10,090) - (46) 20,396 - 43,005 (20) (58)	Note 1 Note 2 Note 3
Innova Vision INC. Innova Vision (B.V.I) Inc. British Virgin Islands Re-investment Innova Vision INC. iPro Vision Inc. Japan Sales of contact lens Innova Vision (B.V.I) Inc. iPro Vision Inc. Japan Sales of contact lens Pilot Battery Co., Ltd. ADL Energy Corp Taiwan Electronic parts and components and energy technical services				60,157 60,157 1,000,000 100% (2,717) (1,245) (1,245) 84,204 84,204 6,400 52.03% (1,756) (3,305) (1,720) 56,420 56,420 5,900 47.97% (1,626) (3,305) (1,585) 413,050 - 11,984,526 100% 68,310 20,396 - Note 3

Note 1: As of December 31, 2023, the funds for shares have not been remitted.

Note 2 : The Company ‘s subsidiary , Aptos Technology INC. invested in One Test Systems in May 2023 with a 100 % shareholding. In August 2023, the Group was reorganized and One Test Systems was directly owned by the Company, with its shareholding remaining at 100%.

Note 3: The Group’s organization was restructured in December 2023 and the Company’s subsidiary, Pilot Battery Co.,Ltd., directly owned ADL Energy Corp. with a shareholding ratio of 100%.

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries Information on investments in China January 1 to December 31, 2023

Table 6

Unit: NTD in thousand (Unless otherwise specified)

Investee in Mainland China	Main business activities	Main business activities	Paid-up capital	Investment method (Note 1)	Investment method (Note 1)	Accumulated amount of remittance from Taiwan to Mainland China at the beginning of theperiod		Amount remitted from Taiwan to China/Amount remitted back to Taiwan for theperiod	Amount remitted from Taiwan to China/Amount remitted back to Taiwan for theperiod	Amount remitted from Taiwan to China/Amount remitted back to Taiwan for theperiod	Accumulated amount of remittance from Taiwan to China	Profit (loss) of the investee for the current period Ownership held by the Company (direct or indirect)	Investment income (loss) recognized by the Company for the current period (Note 2)	Ending carrying amount	Accumulat ed amount of investment income remitted back to Taiwan	Note
								Remitted to		Remitted back
Miko-China Enterprise (Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd.	Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Electronics components manufacturing, electronics materials and precision equipment distribution and power component design IC product design, production and sales		$ 3,283 10,215 53,676	1 1 3		$ 3,283 10,215 -		$ - - -		$ - - -	$ 3,283 10,215 -	$ 54,528 100% 11,025 100% (2,723) 100%	$ 54,528 11,025 (2,723)	$ 392,131 102,768 54,994	$ - - -	Note 2 (2) B Note 2 (2) B, Note 4 Note 2 (2) B
Name of Company Accumulated amount of remittance from Taiwan to China as of the end of the period Investment amount approved by the Investment Commission of the Ministry of Economic Affairs(MOEA) Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA Miracle Technology CO., LTD. $ 13,498 $ 13,498 $ 261,592
Name of Company		Accumulated amount of remittance from Taiwan to China as of the end of the period			Investment amount approved by the Investment Commission of the Ministry of Economic Affairs(MOEA)				Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA
Miracle Technology CO., LTD.		$ 13,498			$ 13,498				$ 261,592

Note 1: Investment methods are classified into the following three categories; fill in the number of categories each case belongs to:

(1) Directly invest in a company in Mainland China.

(2) Through investing in an existing company in the third area (please specify the company), which then invested in Mainland China.

(3) Others

Note 2: Investment income recognized by the Company for the current period

(1) If it is still under preparation with no actual gain or loss, it shall be indicated in the box.

(2) The basis for recognition of the investment gains or losses is divided into the following three, it shall be indicated in the box.

A. Financial statements audited and validated by an international accounting firm that has a collaborative relationship with CPA firms in Taiwan.

B. Financial statements audited and validated by a certified accountant or accounting firm who work with the parent company in Taiwan.

C. Unaudited financial statements.

Note 3: The relevant figures in this table should be presented in New Taiwan Dollars.

Note 4: It was originally invested through Misun Technology Co., Ltd. Since the aforementioned company has gone through dissolution and liquidation, it has been changed to Miracle Technology Co., Ltd. directly investing in Miracle International Enterprise (Shanghai) Co., Ltd.

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries Information on Major Shareholders December 31, 2023 Table 7 Shares Name of Main Shareholders No. of shares held Ownership	Taiwan Mask Corporation and Subsidiaries Information on Major Shareholders December 31, 2023 Table 7 Shares Name of Main Shareholders No. of shares held Ownership	Taiwan Mask Corporation and Subsidiaries Information on Major Shareholders December 31, 2023 Table 7 Shares Name of Main Shareholders No. of shares held Ownership	Taiwan Mask Corporation and Subsidiaries Information on Major Shareholders December 31, 2023 Table 7 Shares Name of Main Shareholders No. of shares held Ownership
		No. of shares held	Ownership
Youe Chung Capital Corporation		35,831,440	13.97%

Taiwan Mask Corp. Control Security C

Taiwan Mask Corporation and Subsidiaries Consolidated financial statements and independent auditor’s report 2023 and 2022 (Stock Code: 2338)

Company address: No. 11, Chuangxin 1st Road, Baoshan, Hsinchu County, Hsinchu Science Park

Telephone: (03)563-4370

~1~

Taiwan Mask Corporation and Subsidiaries

2023 and 2022 Consolidated Financial Statements and Accounting Auditor’s Report

Table of Content

	Item	Page
I.	Cover	1
II.	Table of Contents	2 ~ 3
III.	Statement	4
IV.	Independent Auditors’ Report	5 ~ 9
V.	Consolidated Balance Sheets	10 ~ 11
VI.	Consolidated Statements of Comprehensive Income	12 ~ 13
VII.	Consolidated Statement of Changes in Equity	14
VIII.	Consolidated Statements of Cash Flows	15 ~ 16
IX.	Notes to the Consolidated Financial Statements	17 ~ 92
	(I) Company History	17
	(II) Date and procedures for passing the financial statement	17
	(III) Application of New and Revised International Financial Reporting
	Standards	17 ~ 18
	(IV) Summary of Significant Accounting Policies	19 ~ 35
	(V) Critical Accounting Judgments and Key Sources of Estimation and
	Uncertainty	36
	(VI) Summary of Significant Accounting Items	36 ~ 73
	(VII) Related Party Transactions	73 ~ 75

~2~

		Item	Page
(VIII)	Pledged Assets		76
(IX)	Significant Contingent	Liabilities and Unrecognized Contract
	Commitments		76
(X)	Losses due to Major Disasters		77
(XI)	Major Events after Financial Statement Date		77
(XII)	Others		77 ~ 89
(XIII)	Supplementary Disclosure		89 ~ 89
(XIV)	Segments Information		90 ~ 92

~3~

Taiwan Mask Corporation

Consolidated Financial Statements Declaration

The companies that are required to be included in the affiliated companies consolidated financial statements as of and for the year ended on December 31, 2023, 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 of parent company and subsidiaries prepared in conformity with the International Accounting Standard 10, “Consolidated Financial Statements.” In addition, the information required to be disclosed in the affiliated companies consolidated financial statements is included in the consolidated financial statements of the aforesaid parent company and subsidiaries. Consequently, do not prepare a separate set of consolidated financial statements of the affiliated companies.

Very truly yours

Company Name: Taiwan Mask Corporation

Person in Charge: Sean Chen

March 6, 2024

~4~

Independent Auditors’ Report (113) Tsai-Sheng-Bao-Zi No. 23002830

To Taiwan Mask Corporation,

Opinions

We have audited the accompanying consolidated balance sheets of Taiwan Mask Corporation and its subsidiaries (the “Group”) as of December 31, 2023 and 2022, and the related consolidated statement of comprehensive income, of changes in equity and of cash flows for the years ended December 31, 2022 and 2021, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of the other independent auditors, as described in the Other matters section of our report, the accompanying consolidated financial statements present fairly, in all material aspects, the consolidated financial position of the Group as of December 31, 2023 and 2022, and its consolidated financial performance and its consolidated cash flows for the years ended December 31, 2023 and 2022 in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed by the Financial Supervisory Commission.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of fiscal year 2023. These matters were addressed in the context of our audit of the consolidated financial statements as a whole and, in forming our opinion thereon, we do not provide a separate opinion on these matters.

~5~

Key audit matters for the TMC Group’s consolidated financial statements in fiscal year 2023 are stated as follows:

Evaluation of Inventories

Explanation

Refer to Note 4(14) for the accounting policies on the evaluation of inventories, Note 5(2) for the uncertainty of accounting estimations and assumptions for evaluation of inventories, and Note 6(5) for the detailed description of inventory accounts. The inventory amount and allowance for inventory valuation loss as of December 31, 2023 were NT$805,951 thousand and NT$104,128 thousand, respectively.

The Group is primarily engaged in mask and integrated circuit services in the semiconductor industry. Due to rapid technological innovations, short life-cycle and competition within the mask industry, the risk of price fluctuations, Loss on decline in value of inventories and obsolescence is higher than that of other industries. Management evaluates inventories stated at the lower of cost and net realizable value. Since the evaluation of inventories is subject to management’s judgment and the accounting estimations will have significant influence on the inventory values, the evaluation of inventories has been identified as one of the key audit matters.

How our audit addressed the matter

We have performed primary audit procedures for the above matter as follows:

1. Understand and evaluate the accounting policy for the provision of allowance for losses on decline in value of inventories.

2. Perform test to evaluate the ageing statement of inventories and the statement of lower of cost and net realizable value of inventories, including validating the supporting documents related to the date of inventory movement to confirm the correct ageing classification, and validating the supporting documents related to the net realizable value to assess and confirm the reasonableness of the net realizable value determination.

3. Verify the reasonableness of allowance for inventory valuation loss.

Income recognition

Explanation

For the accounting policy on income recognition, please refer to Note 4(29) of the financial report. For sales revenue, please refer to Note 6(22); the operating income in fiscal year 2023 was NT$7,199,935 thousand.

~6~

The Group mainly produces and sells products such as masks and integrated circuits used in semiconductors, and has a large and diversified sales base. Trading conditions vary according to market conditions and customer needs. Considering that sales revenue is a major transaction that has a significant impact on the consolidated financial statements, we believe that the recognition of sales revenue is one of the most important matters to be considered in this year’s audit.

How our audit addressed the matter

We have performed primary audit procedures for the above matter as follows:

1. Understand the type of major income and assess internal operations, review revenue recognition and accounting treatment.

2. Obtain the sales revenue statement, sample the sales transactions and verify the relevant documents to determine the appropriateness of the sales revenue.

3. Execute the cut-off test for the sales receipts transaction for a certain period of time before and after the closing date, and confirm that the account is correct at the time of entry.

Other matters–Parent company only financial reports

We have audited and expressed an unmodified opinion on the parent company only standalone financial statements of Taiwan Mask Corporation as of and for the years ended December 31, 2023 and 2022.

Responsibilities of management and those charged with governance for the consolidated financial statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the “Regulations Governing the Preparation of Financial Reports by Securities Issuers” and the International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed and issued into effect by the Financial Supervisory Commission, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

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

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

~7~

Independent Auditor’s responsibilities for the audit of the consolidated financial statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ROC AS 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 conducted in accordance with ROC AS, we exercise professional judgment and professional skepticism throughout the audit. We also conduct the following undertakings:

1. 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.

2. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

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

4. Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists 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 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 report. However, future events or conditions may cause the Group to cease to continue as a going concern.

5. 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.

6. 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.

~8~

We communicated 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 for the current period.

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

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 2023 consolidated financial statements of the current period and are therefore deemed 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 auditor’s report because the adverse consequences of doing so would reasonable are expected to outweigh the public interest benefits of such communication.

PricewaterhouseCoopers Taiwan

Ya-Hui Cheng

Accountant

Chien-Yu Liu

Securities and Futures Bureau of Financial Supervisory Commission of the Executive Yuan

Approval Certificate No. 0960072936 Financial Supervisory Commission of the Executive Yuan

Approval Document for Attestation: Jin-Guan-Zheng-Shen-Zi No. 1090350620

March 6, 2024

~9~

Taiwan Mask Corporation and Subsidiaries Consolidated Balance Sheet December 31, 2023 and 2022

Assets	Notes 6(1) 6(2) and 8 6(3) and 8 6(22) 6(4) 6(4) 6(4) and 7 7 6(5) 6(2) and 8 6(3) and 8 6(6) and 7 6(7) and 8 6(8) 6(10) and 8 6(11) and 8 6(29) 6(12)	December31,2023 Amount % $ 1,364,106 7 1,626,536 8 259,885 1 105,263 - 6,049 - 1,478,806 7 26 - 29,003 - 407 - 1,830 - 701,823 3 326,387 2 10,774 - 5,910,895 28 2,896,178 14 660,157 3 67,506 - 9,405,807 45 554,630 3 170,500 1 721,410 3 22,337 - 514,639 3 15,013,164 72 $ 20,924,059 100	Unit: NT$ Thousand December31,2022 Amount % $ 1,749,957 10 1,584,598 9 160,465 1 140,231 1 1,361 - 1,501,012 8 2,346 - 13,751 - - - 42,652 - 382,530 2 280,245 2 44,734 - 5,903,882 33 2,896,557 16 507,602 3 124,565 1 5,883,661 33 550,611 3 170,346 1 497,180 3 9,365 - 1,349,137 7 11,989,024 67 $ 17,892,906 100
		Amount $ 1,364,106 1,626,536 259,885 105,263 6,049 1,478,806 26 29,003 407 1,830 701,823 326,387 10,774 5,910,895 2,896,178 660,157 67,506 9,405,807 554,630 170,500 721,410 22,337 514,639 15,013,164 $ 20,924,059	Amount $ 1,749,957 1,584,598 160,465 140,231 1,361 1,501,012 2,346 13,751 - 42,652 382,530 280,245 44,734 5,903,882 2,896,557 507,602 124,565 5,883,661 550,611 170,346 497,180 9,365 1,349,137 11,989,024 $ 17,892,906
Current assets 1100 Cash and Cash Equivalents 1110 Financial Assets at Fair Value Through Profit or Loss - Current 1136 Financial Assets at Amortized Cost - Current 1140 Contract Asset - Current 1150 Notes Receivables (Net) 1170 Accounts Receivables (Net) 1180 Accounts Receivables - Related Parties (Net) 1200 Other Receivables 1210 Other Receivables - Related Parties 1220 Tax Assets for the Period 130X Inventories 1410 Prepayments 1470 Other Current Assets 11XX Total Current Assets Non-Current Assets 1510 Financial Assets at Fair Value Through Profit or Loss - Non Current 1535 Financial Assets at Amortized Cost - Non Current 1550 Investment under Equity Method 1600 Property, plant and equipment 1755 Right-of-use Asset 1760 Investment property (Net) 1780 Intangible assets 1840 Deferred Income Tax Assets 1900 Other Non-Current Assets 15XX Total Non-Current Assets 1XXX Total Assets

(continued on next page)

~10~

Taiwan Mask Corporation and Subsidiaries Consolidated Balance Sheet December 31, 2023 and 2022

Liabilities and Equities	Notes 6(13) 6(2) 6(22) 7 6(14) 7 6(16) 6(15) 6(16) 6(29) 6(17) 6(18) 6(19) 6(20) 6(21) 6(18) and 8 9 11	December 31,2023 Amount % $ 5,429,370 26 9,383 - 174,538 1 66 - 463,892 2 - - 1,205,153 6 304 - 15,379 - 4,513 - 47,439 - 1,216,216 6 57,651 - 8,623,904 41 3,424,600 16 3,126,340 15 127,215 1 519,754 3 10,648 - 42,282 - - - 7,250,839 35 15,874,743 76 2,564,465 12 1,439,959 7 827,460 4 1,464,101 7 1,641 - ( 1,174,484) ( 6 ) 5,123,142 24 ( 73,826) - 5,049,316 24 $ 20,924,059 100	Unit: NT$ Thousand December 31,2022 Amount % $ 4,624,525 26 5,697 - 232,778 1 81 - 417,175 2 284 - 837,213 5 - - 178,854 1 - - 32,571 - 611,473 4 39,114 - 6,979,765 39 2,609,044 14 3,167,974 18 121,124 1 527,098 3 16,512 - 34,754 - 2,428 - 6,478,934 36 13,458,699 75 2,564,465 14 1,251,681 8 769,952 4 1,729,293 10 10,508 - ( 1,778,979) ( 10) 4,546,920 26 ( 112,713) ( 1) 4,434,207 25 $ 17,892,906 100
		Amount $ 5,429,370 9,383 174,538 66 463,892 - 1,205,153 304 15,379 4,513 47,439 1,216,216 57,651 8,623,904 3,424,600 3,126,340 127,215 519,754 10,648 42,282 - 7,250,839 15,874,743 2,564,465 1,439,959 827,460 1,464,101 1,641 ( 1,174,484) 5,123,142 ( 73,826) 5,049,316 $ 20,924,059	Amount $ 4,624,525 5,697 232,778 81 417,175 284 837,213 - 178,854 - 32,571 611,473 39,114 6,979,765 2,609,044 3,167,974 121,124 527,098 16,512 34,754 2,428 6,478,934 13,458,699 2,564,465 1,251,681 769,952 1,729,293 10,508 ( 1,778,979) 4,546,920 ( 112,713) 4,434,207 $ 17,892,906
Current liabilities 2100 Short Term Loans 2120 Financial liabilities at fair value through profit or loss - Current 2130 Contract Liabilities - Current 2150 Notes Payable 2170 Accounts Payable 2180 Accounts payable - Related party 2200 Other Payables 2220 Other Payables - Related Parties 2230 Current Income Tax Liabilities 2250 Provision for Liabilities - Current 2280 Lease Liability - Current 2320 Long-term liabilities due within one year or one business cycle 2399 Other Current Liabilities - Other 21XX Total Current Liabilities Non-current liabilities 2530 Corporate bonds payable 2540 Long-term borrowings 2570 Deferred Income Tax 2580 Lease liability - Non Current 2640 Defined Benefit Liabilities - Non Current 2645 Guarantee Deposits Received 2670 Other Non-Current Liabilities - Other 25XX Total Non-Current Liabilities 2XXX Total Liabilities Equity attributable to shareholders of the parent company Capital 3110 Capital stock Capital surplus 3200 Capital surplus Retained earnings 3310 Legal reserve 3350 Unappropriated earnings Other equity interests 3400 Other equity interests 3500 Treasury stock 31XX Total Equities Attributable to Parent Company 36XX Non-controlling Interests 3XXX Total Equities Major Commitments and Contingencies Major Events after Financial Statement Date 3X2X Total Liabilities and Equities

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

Chairman: Sean Chen

Managerial Officer: Lidon Chen Accounting Supervisor: Eve Yang

~11~

Taiwan Mask Corporation and Subsidiaries Consolidated Comprehensive Income Statement January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand (Except for earnings per share)

Items

2023 2022 Notes Amount % Amount % 6(22) and 7 $ 7,199,935 100 $ 7,741,118 100 6(5) and 7 ( 5,363,566)( 75) ( 5,642,493) ( 73) 1,836,369 25 2,098,625 27 6(27) (28) and 7 ( 271,119) ( 4) ( 209,947) ( 3) ( 459,028) ( 6) ( 375,754) ( 5) ( 348,136) ( 5) ( 254,090) ( 3) 12(2) ( 9,455) - ( 10,558) - ( 1,087,738)( 15) ( 850,349) ( 11) 748,631 10 1,248,276 16 6(23) 40,742 - 25,271 - 6(24) and 7 133,843 2 258,255 4 6(25) ( 98,389) ( 1) ( 619,247) ( 8) 6(26) ( 293,238) ( 4) ( 177,546) ( 2) 6(6) ( 85,789)( 1) ( 61,296) ( 1) ( 302,831)( 4) ( 574,563) ( 7) 445,800 6 673,713 9 6(29) ( 281,516)( 4) ( 228,081) ( 3) $ 164,284 2 $ 445,632 6

4000 Operating income 5000 Operating costs 5900 Gross profit Operating Expenses 6100 Selling Expenses 6200 Administrative Expenses 6300 R&D Expenses 6450 Expected loss on credit impairment 6000 Total Operating Expenses 6900 Operating profit Non-operating income and expenses 7100 Interest income 7010 Other Incomes 7020 Other Gains and Losses 7050 Financial Costs 7060 The share of affiliates and joint venture profits and losses recognized by the equity method 7000 Total Non-Operating Incomes and Losses 7900 Earnings Before Tax 7950 Income Tax Expense 8200 Net profit for the period

(continued on next page)

~12~

Taiwan Mask Corporation and Subsidiaries Consolidated Comprehensive Income Statement January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand (Except for earnings per share)

Items

2023 2022 Notes Amount % Amount % 6(17) ($ 1,145) - ($ 2,656) - ( 1,145) - ( 2,656) - 6(21) ( 8,867) - 6,476 - ( 8,867) - 6,476 - ($ 10,012) - $ 3,820 - $ 154,272 2 $ 449,452 6 $ 366,126 5 $ 703,519 9 ( 201,842) ( 3)( 257,887)( 3) $ 164,284 2 $ 445,632 6 $ 356,114 5 $ 707,339 9 ( 201,842) ( 3)( 257,887)( 3) $ 154,272 2 $ 449,452 6 6(30) $ 1.75 $ 3.37 6(30) $ 1.65 $ 3.12

Other Comprehensive Incomes (Net) Components of other comprehensive income that will not be reclassified to profit or loss 8311 Re-measurements of defined benefit plan 8310 Total items that will not be reclassified subsequently to profit or loss Components of other comprehensive income that will be reclassified to profit or loss 8361 Financial statement translation differences of foreign operations 8360 Total Components of other comprehensive income that will be reclassified to profit or loss 8300 Other Comprehensive Incomes (Net) 8500 Total comprehensive income for the year Net Incomes (Losses) Attributable to: 8610 Parent Company 8620 Non-controlling Interests Total Total Comprehensive Incomes (Losses) Attributable to: 8710 Parent Company 8720 Non-controlling Interests Total Earnings per share 9750 Net Income Diluted Earnings per share 9850 Net profit for the period

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

Chairperson: Sean Chen Managerial Officer: Lidon Chen Accounting Officer: Eve Yang

~13~

Taiwan Mask Corporation and Subsidiaries Consolidated Statement of Changes in Equity January 1 to December 31, 2023, and 2022

Unit: NT$ Thousand

2022 Balance January 1, 2022 Net Income Other Comprehensive Profit or Loss Total comprehensive income for the year Distribution and appropriation of earnings for 2021 Legal capital reserve Cash dividends Conversion of convertible bonds Distribution of cash from capital surplus Adjustment of capital reserve by dividends paid to subsidiaries Changes in ownership interests in subsidiaries recognized Changes in shares of affiliates and joint ventures recognized under the equity method Share-based payment transaction Treasury Stock Buyback Subsidiaries donated treasury stock Cash increase of non-controlling equity in Subsidiaries Balance December 31, 2022 2023 Balance as at January 1, 2023 Net profit for the period Other Comprehensive Profit or Loss Total comprehensive income for the year Distribution and appropriation of earnings for 2022 Legal capital reserve Cash dividends Distribution of cash from capital surplus Adjustment of capital reserve by dividends paid to subsidiaries Changes in ownership interests in subsidiaries recognized Changes in shares of affiliates and joint ventures recognized under the equity method Subsidiaries donated treasury stock Treasury stocks transfer to employees Payment of overdue unclaimed dividends to shareholders Increase in non-controlling interests in mergers Balance as of December 31, 2023	Notes					Equity	Equity	a	ttributableto share	holders of the parentcompany	holders of the parentcompany	holders of the parentcompany	holders of the parentcompany						Non- controlling Interests		Total Equity
			Capital stock		Capital surplus	Retain		ed	earnings	Otherequityinterests					Treasurystock		Total
						Legal reserve			Unappropriated earnings	Financial statement translation differences of foreign operations			Unrealized gain (loss) on investments on financial assets at fair value through other comprehensive income
	6(21) 6(20) 6 (19)(20) 6(19) 6(19) 6(19) 6 (18)(19) 6(18) 6(18) 6(21) 6(20) 6 (19)(20) 6(19) 6(19) 6(19) 6(18) 6(18) 6(19)		$ 2,556,735 - - - - - 7,730 - - - - - - - - $ 2,564,465 $ 2,564,465 - - - - - - - - - - - - - $ 2,564,465		$ 1,315,828 - - - - - 55,472 ( 241,189 ) 73,463 10,169 21,107 16,831 - - - $ 1,251,681 $ 1,251,681 - - - - - ( 49,797 ) 90,829 133,604 13,793 - - ( 151 ) - $ 1,439,959		$ 656,037 - - - 113,915 - - - - - - - - - - $ 769,952 $ 769,952 - - - 57,508 - - - - - - - - - $ 827,460		$ 1,470,151 703,519 ( 2,656 ) 700,863 ( 113,915 ) ( 241,189 ) - - - ( 86,617 ) - - - - - $ 1,729,293 $ 1,729,293 366,126 ( 1,145 ) 364,981 ( 57,508 ) ( 572,665 ) - - - - - - - - $ 1,464,101		$ 6,698 - 6,476 6,476 - - - - - - - - - - - $ 13,174 $ 13,174 - ( 8,867 ) ( 8,867 ) - - - - - - - - - - $ 4,307		($ 2,666 ) - - - - - - - - - - - - - - ($ 2,666 ) ($ 2,666 ) - - - - - - - - - - - - - ($ 2,666 )		($ 941,423 ) - - - - - - - - - - - ( 842,536 ) 4,980 - ($ 1,778,979 ) ($ 1,778,979 ) - - - - - - - - - 12,807 591,688 - - ($ 1,174,484 )		$ 5,061,360 703,519 3,820 707,339 - ( 241,189 ) 63,202 ( 241,189 ) 73,463 ( 76,448 ) 21,107 16,831 ( 842,536 ) 4,980 - $ 4,546,920 $ 4,546,920 366,126 ( 10,012 ) 356,114 - ( 572,665 ) ( 49,797 ) 90,829 133,604 13,793 12,807 591,688 ( 151 ) - $ 5,123,142		($ 187,509 ) ( 257,887 ) - ( 257,887 ) - - - - - - 130,213 2,230 - - 200,240 ($ 112,713 ) ($ 112,713 ) ( 201,842 ) - ( 201,842 ) - - - - ( 58,871 ) - - - - 299,600 ($ 73,826 )	$ 4,873,851 445,632 3,820 449,452 - ( 241,189 ) 63,202 ( 241,189 ) 73,463 ( 76,448 ) 151,320 19,061 ( 842,536 ) 4,980 200,240 $ 4,434,207 $ 4,434,207 164,284 ( 10,012 ) 154,272 - ( 572,665 ) ( 49,797 ) 90,829 74,733 13,793 12,807 591,688 ( 151 ) 299,600 $ 5,049,316

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

Chairman: Sean Chen

Managerial Officer: Lidon Chen

Accounting Supervisor: Eve Yang

~14~

Taiwan Mask Corporation and Subsidiaries Consolidated Cash Flow Statements January 1 to December 31, 2023, and 2022

Cash Flow from Operating Activities Net Income (Loss) Before Tax Adjustments to Reconcile Net Income to Net Cash Flow from Operating Activities Revenues and Expenses Depreciation Amortization Expected loss on credit impairment Interest income Interest Expenses Subsidiaries donated treasury stock Net losses of financial assets at fair value through profit or loss Gain (loss) on disposal of investments Dividend income Share-based payment transaction Share of losses of affiliated companies recognized under the equity method Disposal of interests in property, plant and equipment Gains on disposal of intangible assets Property, plant and equipment reclassified as expenses The Changes of Assets/ Liabilities related to Operating Activities Net Changes of Assets related to Operating Activities Mandatory financial assets at fair value through profit or loss Contract Assets Notes Receivables Accounts Receivables Accounts Receivables－Related Parties Other Receivables Other Receivables－Related Parties Inventories Prepayments Other Current Assets Other Non-Current Assets Net Changes of Liabilities related to Operating Activities Contract Liabilities Notes Payable Accounts Payable Accounts payable - Related party Other Payables Other Payables- related Parties Provisions Other Current Liabilities Defined Benefit Liabilities Other Current Liabilities Net Cash In-Flow from Operating Dividends Received Interest Received Interest Paid Income Tax Paid Net Cash In-Flow from Operating Activities

Unit: NT$ Thousand Notes January 1 to December31,2023 January 1 to December31,2022 $ 445,800 $ 673,713 6(27) 933,404 568,193 6(27) 52,495 45,391 12(2) 9,455 10,558 6(23) ( 40,742 ) ( 25,271 ) 6(26) 293,238 177,546 7 12,807 4,980 6(25) 221,510 801,122 6(25) ( 101,102 ) ( 123,552 ) 6(24) ( 94,064 ) ( 194,598 ) 6(18) - 19,061 6(6) 85,789 61,296 6(25) ( 688 ) ( 5,024 ) 6(25) ( 25,499 ) - 78 1,186 ( 175,131 ) ( 115,356 ) 34,968 15,532 ( 4,604 ) ( 1,298 ) 28,959 ( 247,822 ) 2,320 14,466 ( 16,753 ) 55,246 ( 407 ) - ( 250,767 ) 21,187 ( 40,501 ) ( 158,379 ) 35,911 ( 14,837 ) 29,108 671 ( 67,726 ) 53,463 ( 79,735 ) 15 27,826 ( 60,057 ) ( 284 ) 284 49,752 144,840 304 - - ( 10,964 ) 17,970 ( 167 ) ( 7,012 ) 4,169 ( 7,228) ( 98,218) 1,369,451 1,617,376 110,914 194,598 42,243 25,271 ( 260,590 ) ( 177,546 ) ( 444,991) ( 246,930) 817,027 1,412,769

(continued on next page)

~15~

Taiwan Mask Corporation and Subsidiaries Consolidated Cash Flow Statements January 1 to December 31, 2023, and 2022

Cash Flow from Investment Activities Acquisition of Amortized Cost Financial Assets Disposal of Amortized Cost Financial Assets Cash outflows from changes in consolidated entities Acquisition of investment property by the Equity Method Acquisition of Property, Plants and Equipment Disposal of Property, Plants and Equipment Acquisition of Intangible Assets Gains on disposal of intangible assets Increase in Refundable Deposit Net Cash Outflow from Investing Activities Cash Flows from Financing Activities Increase of Short Term Loan Redemption of Short Term Loan Increase of Long Term Loan Redemption of Long Term Loan Issuance of ordinary corporate bonds Treasury stocks transfer to employees Cost of treasury stock buyback Redemption of Lease Principal Increase in Guarantee Deposits Received Distribution of cash dividends (including capital surplus distribution cash) Cash increase of non-controlling equity in Subsidiaries Payment of overdue unclaimed dividends Net Cash In-Flow (Out-Flow) from Funding Activities Adjustments of Exchange Rate Increase (Decrease) in Cash and Cash Equivalents Beginning Balance of Cash and Cash Equivalents Ending Balance of Cash and Cash Equivalents

Unit: NT$ Thousand Notes January 1 to December31,2023 January 1 to December31,2022 ( $ 672,781 ) ( $ 610,686 ) 416,418 20,882 6(31) ( 78,027 ) - ( 15,000 ) - 6 (32) ( 3,179,581 ) ( 2,911,204 ) 8,695 6,020 6(11) ( 36,975 ) ( 45,767 ) 27,043 - ( 35,869 ) ( 36,932 ) ( 3,566,077 ) ( 3,577,687 ) 6 (33) 7,613,689 16,200,182 6 (33) ( 6,907,998 ) ( 15,952,423 ) 6 (33) 1,593,546 4,569,424 6 (33) ( 1,061,577 ) ( 3,512,177 ) 6 (33) 797,338 997,095 591,688 - - ( 842,536 ) 6 (33) ( 51,816 ) ( 55,556 ) 6 (33) 7,528 27,846 ( 531,633 ) ( 408,915 ) 299,600 200,240 ( 151 ) - 2,350,214 1,223,180 12,985 9,876 ( 385,851 ) ( 931,862 ) 1,749,957 2,681,819 6(1) $ 1,364,106$ 1,749,957

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

Chairperson: Sean Chen

Managerial Officer: Lidon Chen

Accounting Officer: Eve Yang

~16~

Taiwan Mask Corporation and Subsidiaries Notes to the Consolidated Financial Statements

2023 and 2022

Unit: NT$ Thousand (Unless otherwise specified)

I. Company History

Taiwan Mask Corporation (hereinafter referred to as the “Company”) was established on October 21, 1988, and started its operations in March 1989. The Company was approved by the shareholders meeting on June 12, 2000 to acquire Shin-Tai Technology Co., Ltd., on the merger record date of December 1, 2000, with the Company being the surviving entity. The Company and its subsidiary (collectively referred to as the “Group”) mainly engage in the research, development, manufacturing and sales of photomask and integrated circuits, providing technical assistance, consultation, inspection and repair of the abovementioned products, and manufacturing and buying and selling of medical equipment.

II. Date and procedures for passing the financial statement

The consolidated financial statements were reported to the Board of Directors and issued on March 6, 2024.

III. Application of New and Revised International Financial Reporting Standards

(I) The impact from adopting the newly released and revised IFRS and IAS recognized and issued into effect by the Financial Supervisory Commission (FSC).

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS recognized and issued into effect by the Financial Supervisory Commission in 2023:

Newly released/corrected/amended standards and	Effective Date Issued by
interpretations	IASB
Amendment to IAS 1 - “Disclosure of Accounting Policies”	January 1, 2023
Amendments to IAS 8 “Definition of Accounting Estimates”	January 1, 2023
Amendments to IAS 12, “Deferred Income Taxes Related to	January 1, 2023
Assets and Liabilities Arising from a Single Transaction”
Amendment to IAS 12 “International Tax Reform - Pillar	May 23, 2023
Two Model Rules”

The Group believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

~17~

• (II) Impact of the newly released and amended IFRS and IAS recognized by the FSC not yet adopted by the Company.

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS recognized by the Financial Supervisory Commission in 2024:

Newly released/corrected/amended standards and Effective Date Issued by interpretations IASB Amendments to IFRS 16 - “Liabilities of Lease from the January 1, 2024 Leaseback” Amendment to IAS 1 “Classification of Liabilities as Current January 1, 2024 or Non-Current” Amendment to IAS 1 “Non-Current Liabilities With January 1, 2024 Covenants” Amendments to IAS 7 and IFRS 7 “Supplier Financing January 1, 2024 Arrangements”

The Group believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

(III) IFRS and IAS issued by the IASB but not yet recognized by the FSC.

The following table summarizes the applicable newly released, corrected and amended standards and interpretations of the IFRS and IAS issued by the IASB but not yet recognized by the FSC:

Newly released/corrected/amended standards and	Effective Date Issued by
interpretations	IASB
IFRS 10 and IAS 28 amendments, Sale or contribution of	To be determined by the
assets between an investor and its associate or joint venture	IASB
IFRS 17 - Insurance contracts	January 1, 2023
Amendment to IFRS 17 - Insurance contracts	January 1, 2023
Amendments to IFRS 17 “First-time Adoption of IFRS 17	January 1, 2023
and IFRS 9 - Comparative Information”
Amendments to IAS No. 21 “Lack of Exchangeability”	January 1, 2023

The Group believes that the adoption of aforementioned IFRSs will not have a significant effect on the financial position and performance.

~18~

IV. Summary of Significant Accounting Policies

The principal accounting polices applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the periods presented, unless otherwise stated.

(I) Compliance statement

These consolidated financial statements of the Group have been prepared in accordance with the “Rules Governing the Preparation of Financial Statements by Securities Issuers”, International Financial Reporting Standards, International Accounting Standards, IFRIC Interpretations, and SIC Interpretations as endorsed and issued into effect by the FSC (collectively referred herein as the “IFRSs”).

(II) Basis of Preparation

1. Except for the following items, these consolidated financial statements have been prepared under the historical cost convention.

2. (1) Financial assets and financial liabilities at fair value through profit or loss (including derivatives).

3. (2) Financial Assets at Fair Value Through Other Comprehensive Income.

4. (3) Defined benefit liabilities recognized based on the net amount of pension fund assets less present value of defined benefit obligation.

5. The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note V.

(III) Basis of consolidation

1. The basis for preparation of consolidated financial statements

2. (1) All subsidiaries are included in the Corporate Group’s consolidated financial statements. Subsidiaries are all entities controlled by the Corporate Group. The Corporate Group controls an entity when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Consolidation of subsidiaries begins from the date the Group obtains control of the subsidiaries and ceases when the Group loses control of the subsidiaries.

3. (2) Inter-company transactions, balances and unrealized gains or losses on transactions between companies within the Corporate Group are eliminated. Accounting policies of subsidiaries have been adjusted where necessary to ensure consistency with the policies adopted by the Corporate Group.

4. (3) The profit and loss and the components of other comprehensive income attribute to the owners of the parent company and non-controlling interest. The total comprehensive income also attributes to the owners of the parent company and non-controlling interest, even if this results in the non-controlling interests having a deficit balance.

5. (4) Changes in a parent’s ownership interest in a subsidiary that do not result in the parent losing control of the subsidiary (transactions with non-controlling interests) are equity transactions, and they are considered as transactions with owners in their capacity as owners. Any difference between the amount by which the non-controlling interests are

~19~

adjusted and the fair value of the consideration paid or received is directly recognized in equity.

• (5) When the Group loses control of a subsidiary, the Group remeasures any investment retained in the former subsidiary at its fair value. That fair value is regarded as the fair value on initial recognition of a financial asset or the cost on initial recognition of the associate or joint venture. Any difference between fair value and carrying amount is recognized in profit or loss. All amounts previously recognized in other comprehensive income in relation to the subsidiary are reclassified to profit or loss on the same basis as would be required if the related assets or liabilities were disposed of. That is, when the Group loses control of a subsidiary, all gains or losses previously recognized in other comprehensive income in relation to the subsidiary should be reclassified from equity to profit or loss, if such gains or losses would be reclassified to profit or loss when the related assets or liabilities are disposed of.

~20~

2. Subsidiaries included in the consolidated financial statements:

Name Name of Subsidiary Ownership (%) Main Business Activity December 31, 2023 December 31, 2022 Taiwan Mask Corporation SunnyLake Park International Holding, Inc. Name of Investor 100 100 Taiwan Mask Corporation Youe Chung Capital Corporation Name of Investor 100 100 Taiwan Mask Corporation Miracle Technology CO., LTD. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Taiwan Mask Corporation Innova Vision INC. Manufacturing, retail, wholesale and international trade of medical equipment 75.32 91.53 Taiwan Mask Corporation One Test Systems Research, development and design of test equipment and related components 100 - Taiwan Mask Corporation Pilot Battery Co., Ltd. Electronic parts and components and energy technical services 20.00 - Youe Chung Capital Corporation Innova Vision INC. Manufacturing, retail, wholesale and international trade of medical equipment 0.19 0.23 Youe Chung Capital Corporation Aptos Technology INC. Design, packaging and testing of NAND flash memory, solid state drives and the related products 47.19 47.19 Youe Chung Capital Corporation Xsense Technology Corporation Name of Investor 100 100 Youe Chung Capital Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch Precious metal coating 53.00 53.00 Xsense Technology Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch Precious metal coating - - Youe Chung Capital Corporation Digital-Can Tech. Co., Ltd. 3D Printing and Plastic Mold Design 57.39 57.39 Youe Chung Capital Corporation Pilot Battery Co., Ltd. Electronic parts and components and energy technical services 38.89 - Youe Chung Capital Corporation Moment Semiconductor, Inc. Retail and wholesale of memory products 53.33 -

Explanation

Note 3 Note 1 Note 4 Note 5 Note 5 Note 5 Note 1 Note 2

~21~

Name Name of Subsidiary Ownership (%) Main Business Activity December 31, 2023 December 31, 2022 Aptos Technology INC. ADL Energy Corp Electronic parts and components and energy technical services - 100 Aptos Technology INC. New Sunrise Limited Name of Investor 100 100 Pilot Battery Co., Ltd. ADL Energy Corp Electronic parts and components and energy technical services 100 - ADL Energy Corp Aptos Global Holding Corp. Name of Investor 100 100 Miracle Technology CO., LTD. Jing Hao Investment Co., Ltd. Name of Investor 100 100 Miracle Technology CO., LTD. Miracle International Enterprise(Shangh ai) Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Jing Hao Investment Co., Ltd. Miko-China Enterprise (Shanghai) Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Jing Hao Investment Co., Ltd. MIKO Technology Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Miko-China Enterprise (Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. IC product design, production and sales 79.17 79.17 Miracle International Enterprise(Shangh ai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. IC product design, production and sales 20.83 20.83 Innova Vision INC. Innova Technology Medical equipment retail and wholesale 100 100 Innova Vision INC. Innova Vision (B.V.I.) Inc. Name of Investor 100 100 Innova Vision INC. iPro Vision Inc. Medical equipment retail and wholesale 52.03 52.03 Innova Vision (B.V.I.) Inc. iPro Vision Inc. Medical equipment retail and wholesale 47.97 47.97	Name Name of Subsidiary Ownership (%) Main Business Activity December 31, 2023 December 31, 2022 Aptos Technology INC. ADL Energy Corp Electronic parts and components and energy technical services - 100 Aptos Technology INC. New Sunrise Limited Name of Investor 100 100 Pilot Battery Co., Ltd. ADL Energy Corp Electronic parts and components and energy technical services 100 - ADL Energy Corp Aptos Global Holding Corp. Name of Investor 100 100 Miracle Technology CO., LTD. Jing Hao Investment Co., Ltd. Name of Investor 100 100 Miracle Technology CO., LTD. Miracle International Enterprise(Shangh ai) Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Jing Hao Investment Co., Ltd. Miko-China Enterprise (Shanghai) Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Jing Hao Investment Co., Ltd. MIKO Technology Co., Ltd. Electronics components manufacturing, electronics materials and precision equipment distribution and power component design 100 100 Miko-China Enterprise (Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. IC product design, production and sales 79.17 79.17 Miracle International Enterprise(Shangh ai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. IC product design, production and sales 20.83 20.83 Innova Vision INC. Innova Technology Medical equipment retail and wholesale 100 100 Innova Vision INC. Innova Vision (B.V.I.) Inc. Name of Investor 100 100 Innova Vision INC. iPro Vision Inc. Medical equipment retail and wholesale 52.03 52.03 Innova Vision (B.V.I.) Inc. iPro Vision Inc. Medical equipment retail and wholesale 47.97 47.97	Explanation
	100 100 - 100 100 100 100 100 79.17 20.83 100 100 52.03 47.97	Note 7 Note 7 Note 6 Note 6

Note 1: In March 2023, the Company’s subsidiary, Youe Chung Capital Corporation, invested in Pilot Battery Co.,Ltd. with 58.33% shareholding. Pilot Battery Co.,Ltd.

~22~

organized capital increase in cash by issuing new shares in November 2023. Youe Chung Capital Corporation did not execute based on shares proportion. Instead, the Company participated in the cash capital increase. As of December 2023, the Company and the Company’s subsidiary, Youe Chung Capital Corporation, respectively held shares of ratio was 20% and 38.89%.

• Note 2: In March 2023, the Company’s subsidiary, Youe Chung Capital Corporation, invested in Moment Semiconductor, Inc. with 53.33% shareholding.

• Note 3: The Company’s subsidiary, Aptos Technology INC. invested in One Test Systems in May 2023 with a 100 % shareholding. In August 2002, the Group was reorganized and One Test Systems was directly owned by the Company, with its shareholding remaining at 100%.

• Note 4: The Company’s subsidiary, Youe Chung Capital Corporation, which holds a majority of the Board of Directors of the company, has substantial control over the company and therefore included the company in the consolidated financial statements as a consolidated entity.

• Note 5: In November 2022, Xsense Technology Corporation reduced its capital, leaving only one share which was 100% owned by Youe Chung Capital Corporation. At the same time, Xsense Technology Corporation applied for the transfer of its shares in Xsense Technology Corporation (B.V.I.) Taiwan Branch to the original shareholders of Xsense Technology Corporation in the same proportion. After the transfer, the original shareholders of Xsense Technology Corporation switched to owning Xsense Technology Corporation (B.V.I.) Taiwan Branch. As of December 31, 2023, Youe Chung Capital Corporation held 100% of Xsense Technology Corporation and 53.00% of Xsense Technology Corporation (B.V.I.) Taiwan Branch, respectively.

• Note 6: Originally named Innova Vision Kabushiki Kaisha, renamed to iPro Vision Inc. on February 17, 2023.

• Note 7: Aptos Technology Inc., a subsidiary of the Company, held 100% equity of ADL Energy Corp. The Group’s organization was restructured in December 2023 and the Company’s subsidiary, Pilot Battery Co., Ltd., directly owned ADL Energy Corp. with a shareholding ratio of 100%.

• Subsidiaries not included in the consolidated financial statement: None.

• Adjustments for subsidiaries with different balance sheet dates: None.

• Significant restrictions: None.

• Subsidiaries that have non-controlling interests that are material to the Group:

The total non-controlling interests of the Group as of December 31, 2023 and 2022 were (NT$73,826) and (NT$112,713), respectively. The following information shows subsidiaries that have non-controlling interests that are material to the Group:

~23~

Non-controlling Interests

		Non-controlling	Interests	Interests
Name of Subsidiary Aptos Technology and its subsidiaries	Main location of business Taiwan ($	December 31, 2023 Amount Ownership in % 248,253) 52.81% ($	December 31, 2022 Amount Ownership in % 100,582) 52.81%		Explanation
				% 52.81%

Aggregate financial information of subsidiaries:

Balance Sheet

Current assets Non-Current Assets Current liabilities Non-current liabilities Total net assets	Aptos Technology December 31, 2023 $ 248,931 501,076 ( 857,464) ( 362,617) ($ 470,074)	Aptos Technology	and its subsidiaries December 31, 2022 $ 339,417 579,075 ( 679,551) ( 429,397) ($ 190,456)

Statement of Comprehensive Income

Revenue Net loss before taxes Income tax benefits Net loss of current period from continuing operations Loss from discontinued operations Net loss for the period Other comprehensive income (net after tax) Total comprehensive income for the year	$	Aptos Technology	Aptos Technology	and its subsidiaries 2022 $ 708,792 ( 295,477) - ( 295,477) - ( 295,477) - ($ 295,477)
			2023 536,868 274,029) 15 274,014) - 274,014) - 274,014)	$
	(			(
	(			(
	(			(
	($			($

~24~

Statements of Cash Flows

Net cash outflow from operating activities Net Cash Outflow from Investing Activities Net Cash In-Flow (Out-Flow) from Funding Activities Increase (Decrease) of Cash and Cash Equivalents Beginning Balance of Cash and Cash Equivalents Ending Balance of Cash and Cash Equivalents	($	Aptos Technology	Aptos Technology	and its subsidiaries 2022 ($ 236,453) ( 106,726) 327,492	and its subsidiaries 2022 ($ 236,453) ( 106,726) 327,492
			2023 129,331) 28,644 140,091 39,404 18,461 57,865	($ (
				(	15,687) 34,148
	$			$	18,461

(IV) Foreign currency translation

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in New Taiwan dollars, which is the Company’s functional currency.

1. Foreign currency transactions and balances

2. (1) Foreign currency transactions are translated into the functional currency using spot exchange rate at the dates of the transactions or valuation where items are remeasured. Foreign exchange gains and losses resulting from the settlement of such transactions are recognized in profit or loss in the period in which they arise.

3. (2) Monetary assets and liabilities denominated in foreign currencies at the period end are re-translated using spot exchange rate at the balance sheet date. Exchange differences arising from re-translation at the balance sheet date are recognized in profit or loss.

4. (3) Non-monetary assets and liabilities denominated in foreign currencies held at fair value through profit or loss are re-translated using spot exchange rate at the balance sheet date. Their translation differences are recognized in profit or loss. Non-monetary assets and liabilities denominated in foreign currencies held at fair value through other comprehensive income are re-translated using spot exchange at the balance sheet date. Their translation differences are recognized in other comprehensive income. For those which are not measured at fair value, they measured by the historical exchange rate of the initial transaction date.

5. (4) All foreign exchange gains and losses are presented in the statement of comprehensive income within “Other gains and losses”.

6. Translation of foreign operations

7. (1) The operating results and financial position of all corporate group entities and affiliates that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

   • A. Assets and liabilities for each balance sheet presented are translated at the closing exchange rate at the date of that balance sheet.

~25~

• B. Income and expenses for each statement of comprehensive income are translated at average exchange rates of that period.

• C. All resulting exchange differences are recognized in other comprehensive income.

• (2) When the foreign operation that is partially disposed of or sold is a subsidiary, the accumulated conversion difference recognized as other comprehensive income is reattributed to the foreign operation’s non-controlling interests on a pro rata basis. However, even if the Group retains part of its equity in the former subsidiary, but has lost control of the subsidiary of the foreign operation, it will be treated with as a disposal of the entire equity of the foreign operation

• (3) Goodwill and fair value adjustments arising on acquisition of a foreign entity are regarded as assets and liabilities of the foreign entity, and are translated at the closing rate.

(V) Classification of current and non-current items

1. Assets that meet one of the following criteria are classified as current assets:

2. (1) Assets arising from operating activities that are expected to be realized, or are intended to be sold or consumed within the normal operating cycle.

3. (2) Assets held mainly for trading purposes.

4. (3) Assets that are expected to be realized within twelve months from the balance sheet date.

5. (4) Cash and cash equivalents, excluding restricted cash and cash equivalents and those that are to be exchanged or used to pay off liabilities more than twelve months after the balance sheet date.

Those that do not meet the above criteria are considered non-current.

1. Liabilities that meet one of the following criteria are classified as current liabilities:

2. (1) Liabilities that are expected to be paid off within the normal operating cycle.

3. (2) Assets held mainly for trading purposes.

4. (3) Liabilities that are to be paid off within twelve months from the balance sheet date.

5. (4) Liabilities for which the repayment date cannot be extended unconditionally to more than twelve months after the balance sheet date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its classification.

Those that do not meet the above criteria are considered non-current.

(VI) Cash equivalents

Cash equivalents refer to short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Time deposits that meet the definition above and are held for the purpose of meeting short-term cash commitments in operations are classified as cash equivalents.

(VII) Financial assets at fair value through profit and loss

1. Refer to the financial assets that are not measured at amortized cost, or are measured at fair value through other comprehensive gain or loss.

2. On a regular way purchase or sale basis, financial assets at fair value through profit or loss are recognized and derecognized using trade date accounting.

3. The Group measures financial assets at fair value in initial recognition. The related

~26~

transaction costs are recognized in profit and loss. These financial assets are subsequently re-measured and stated at fair value, and any changes in the fair value of these financial assets are recognized in profit or loss.

1. When the right to receive dividends is established, the economic benefits associated with the dividends are likely to flow in, and the amount of dividends can be reliably measured, the Group recognizes dividend income in profit or loss.

(VIII) Financial assets at fair value through other comprehensive profit and loss

1. Refers to an irrevocable election at the time of initial recognition to report the fair value changes of equity investments that are not held for trading in other comprehensive income.

2. On a regular way purchase or sale basis, financial assets at fair value through other comprehensive income are recognized and derecognized using trade date accounting.

3. The Corporate Group measures financial assets at fair value plus transaction costs at the initial recognition. The financial assets are subsequently measured at fair value. The fair value changes of equity investments are recognized in other comprehensive income. At the time derecognition, the accumulated gains or losses previously recognized in other comprehensive income shall not subsequently reclassified to profit or loss, and shall be transferred to retained earnings. When the right to receive dividends is established, the economic benefits associated with the dividends are likely to flow in, and the amount of dividends can be reliably measured, the Group recognizes dividend income in profit or loss.

(IX) Financial assets measured at amortized cost

1. Refer to those that meet the following criteria at the same time:

   • (1) The objective of the business model is achieved by collecting contractual cash flows.

   • (2) The assets’ contractual cash flows solely represent payments of principal and interest.

2. The Corporate Group holds time deposits that are not considered cash equivalents. Due to the short holding period, the impact of discounting is insignificant and is measured by the amount of investment.

3. (X) Accounts and notes receivable

4. Refers to accounts and notes that have been unconditionally charged for the right to exchange the value of the consideration due to the transfer of goods or services.

5. The short-term accounts and notes receivable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(XI) Impairment Loss of Financial Assets

Regarding debt instruments measured at FVTOCI, financial assets measured at amortized cost, accounts receivable or contract assets and lease receivables that contain significant financing components, the Group, on each balance sheet date, considers all reasonable and supportable information (including forward-looking ones) and measure the loss allowance based on the 12-month expected credit losses for those that do not have their credit risk increased significantly since initial recognition. For those that have increased significantly since initial recognition, the loss allowance is measured based on the full lifetime expected credit losses. A loss allowance for full lifetime expected credit losses is also required for contract assets or trade receivables that do not constitute a financing transaction.

~27~

(XII) De-recognition of financial assets

A financial asset is derecognized when the Group’s rights to receive cash flows from the financial assets have expired.

(XIII) Lessor’s lease transaction - Operating lease

Lease income from operating leases, less any incentives given to the lessee, is amortized in current profit or loss on a straight-line basis over the lease term.

(XIV) Inventories

Inventories are measured at the lower of cost or net realizable value, and the cost is determined by weighted-average method. The cost of finished goods and work-in-progress comprises raw materials, direct labor, other direct costs and related production overheads (amortized according to normal production capacity), but excludes borrowing costs. At the end of year, inventories are evaluated at the lower of cost or net realizable value. The item by item approach is used in applying the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable costs of completion and selling expenses.

(XV) Investments accounted for using equity method - Associates

1. Associates refer to entities over which the Corporate Group has significant influence but is not in control. In general, the associates may have more than 20% of their voting shares directly or indirectly owned by the Group. The Corporate Group accounts for its investment in associates using the equity method, and the investment is initially recognized at cost.

2. The Corporate Group recognizes the profit and loss upon the acquisition of associates as the current profit and loss. Other comprehensive profit and loss after the acquisition are recognized as the other comprehensive profit and loss. When the Corporate Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group will not recognize further losses, unless it has incurred legal or constructive obligations or make payments on behalf of the associate.

3. If an associate has changes in equity not from profit or loss or other comprehensive income, and such changes do not affect the Corporate Group’s shareholding in the associate, the Group will recognize all changes in equity attributable to the Group’s share of the associate as “capital surplus” according to the shareholding percentage.

4. Unrealized gains on transactions between the Corporate Group and associates are eliminated to the extent of the Group’s interest in the associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been adjusted where necessary to ensure consistency with the policies adopted by the Corporate Group.

5. In the event that an associate issues new shares and the Corporate Group does not subscribe to or acquire the new shares in proportion, which results in a change to the Group’s shareholding percentage but the Group maintains a significant influence on the associate, the increase or decrease of the Group’s share of equity interest is the adjustment of “capital surplus” and “investments accounted for under the equity method”. If the investment percentage is reduced, in addition to the above adjustments, the amounts previously recognized in other comprehensive income in relation to the associate are reclassified to profit or loss proportionally on the same basis as would be required if the

~28~

relevant assets or liabilities were disposed of.

• (XVI) Property, plant and equipment

• Property, plant and equipment are initially recorded at cost. Borrowing costs incurred during the construction period are capitalized.

• Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Corporate Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to profit or loss during the financial period in which they are incurred.

• Land is not depreciated. Other property, plant and equipment apply cost model and are depreciated using the straight-line method to allocate their cost over their estimated useful lives. Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item must be depreciated separately.

• The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each balance sheet date. If expectations for the assets’ residual values and useful lives differ from previous estimates or the patterns of consumption of the assets’ future economic benefits embodied in the assets have changed significantly, any change is accounted for as a change in estimate under IAS 8, “Accounting Policies, Changes in Accounting Estimates and Errors,” from the date of the change. The estimated useful lives of property, plant and equipment are as follows:

Buildings and structures	5 years to 60 years
Machinery and equipment	2 years to 14 years
Office equipment	2 years to 7 years
Transportation equipment	3 years to 7 years
Leasehold improvements	2 years to 10 years
Mold equipment	2 years
Other equipment	2 years to 12 years

(XVII) Leasing agreements (lessee) - Right-of-use assets/lease liabilities

1. Leases are recognized as right-of-use assets and lease liabilities at the date at which the leased assets are available for use by the Group. For short-term leases or leases of lowvalue assets, lease payments are recognized as expenses on a straight-line basis over the lease term.

2. Lease liabilities include the net present value of the remaining lease payments at the commencement date, discounted using the incremental borrowing interest rate. Lease payments include fixed payments, less any lease incentives receivables.

The Company subsequently measures the lease liability at amortized cost using the interest method and recognizes interest expense over the lease term. The lease liability is remeasured and the amount of re-measurement is recognized as an adjustment to the rightof-use asset when there are changes in the lease term or lease payments and such changes do not arise from contract modifications.

1. At the commencement date, the right-of-use asset is recognized at cost which includes:

2. (1) The amount of initial measurement of lease liability.

~29~

• (2) Any lease payments made at or before the commencement date.

• (3) Any original direct costs incurred.

• (4) The estimated cost of dismantling, removing the underlying asset and restoring its location, or restoring the underlying asset to the condition required in the lease terms and conditions.

The right-of-use asset is measured subsequently using the cost model and is depreciated from the commencement date to the earlier of the end of the asset’s service life or the end of lease term. When the lease liability is remeasured, the amount of re-measurement is recognized as an adjustment to the right-of-use asset.

(XVIII) Real estate investment

Investment properties are initially measured at cost, and may be subsequently measured using a cost model. Except for land, the service life is recognized on a straight-line basis of depreciation and is about 45 years.

(XIX) Intangible assets

1. Trademark and concession

Trademarks and concession obtained separately are recognized at the cost of acquisition, and trademarks and concessions obtained as a result of a business combination are recognized at fair value on the acquisition date. Trademarks and concessions are assets with a limited useful life and are amortized based on the estimated useful life of 10 to 15 years based on the straight-line method.

1. Computer software

Computer software is recognized at the cost of acquisition, and amortized based on the estimated useful life of 3 years based on the straight-line method.

1. Goodwill

Goodwill is measured in a business combination using the acquisition method.

(XX) Impairment of non-financial assets

1. The Corporate Group assesses at each balance sheet date the recoverable amounts of those assets where there is an indication that they are impaired. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less disposal cost or value in use. When the circumstances or reasons for recognizing impairment loss for an asset in prior years no longer exist or diminish, the impairment loss is reversed. The increased carrying amount due to reversal should not be more than what the depreciated or amortized historical cost would have been if the impairment had not been recognized.

2. Goodwill, intangible assets with indefinite useful life and intangible assets not yet available for use are regularly estimated for their recoverable amounts. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The goodwill impairment loss will not be reversed in subsequent years.

3. Goodwill is allocated to cash-generating units for the purpose of conducting the impairment testing. The allocation identified based on the operating segment, and the goodwill is allocated to cash-generation units or groups of cash-generation units expected to benefit from the business combination that generates goodwill.

~30~

(XXI) Borrowings

Refers to long- and short-term funds borrowed from banks and other long- and short-term borrowings. Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognized in profit or loss over the period of the borrowings using the effective interest method.

(XXII) Accounts and notes receivable

1. Refers to debts incurred as a result of the purchase of raw materials, goods or services and the notes payable due to business and non-business purposes.

2. The short-term accounts and notes payable without bearing interest are subsequently measured at initial invoice amount as the effect of discounting is immaterial.

(XXIII) Convertible bonds payable

The convertible bonds payable issued by the Group are embedded with conversion options (i.e., the holder’s right to choose to convert to the Group’s common stock for a fixed amount of shares), put options and call options. The issuance price is classified as financial assets, financial liabilities or equity at the time of initial issuance according to the terms of issuance, which is treated as follows:

1. Embedded put options and call options: “Financial assets or liabilities at fair value through profit or loss” are recorded at their net fair value on initial recognition; subsequently, “Gain or loss on financial assets (liabilities) at fair value through profit or loss” is recognized on the balance sheet date, with the difference valued at current fair value.

2. Master contract of corporate bonds: The difference between the fair value of the corporate bonds and the redemption value is recognized as a premium or discount on the corporate bonds payable at the time of original recognition; subsequently, it is recognized in profit or loss as an adjustment to “finance costs” using the effective interest method under the amortization procedure over the circulation period.

3. Embedded conversion options (which meet the definition of equity): On initial recognition, the remaining value of the issue amount, net of the above “financial assets or liabilities at fair value through profit or loss” and “corporate bonds payable”, is recorded as “capital surplus - stock options” and is not subsequently remeasured.

4. Any directly attributable transaction costs of the issuance are allocated to each component of liabilities and equity in proportion to the original carrying amount of each component mentioned above.

5. Upon conversion, the components of liabilities (including “corporate bonds payable” and “financial assets or liabilities at fair value through profit or loss”) are subsequently measured according to their respective classifications, and the carrying amount of the aforementioned components of liabilities is added to the carrying amount of “capital surplus - stock options” as the issuance cost of common stock exchanged.

(XXIV) Employee benefits

1. Short-term employee benefits

Short-term employee benefits are measured at the undiscounted amount of the benefits expected to be paid in respect of service rendered by employees in a period and should

~31~

be recognized as expenses in that period when the employees render service.

1. Pension

2. (1) Defined contribution plans

For defined contribution plans, the contributions are recognized as pension expenses when they are due on an accrual basis. Prepaid contributions are recognized as an asset to the extent of a cash refund or a reduction in the future payments.

• (2) Defined benefit plans

  • A. Net obligation under a defined benefit plan is defined as the present value of an amount of pension benefits that employees will receive on retirement for their services with the Group in current period or prior periods. The liability recognized in the balance sheet in respect of defined benefit pension plans is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The net defined benefit obligation is calculated annually by independent actuaries using the projected unit credit method. The rate used to discount is determined by using the current interest rates of government bonds (at the balance sheet date) consistent with the currency and period of the defined-benefit plan instead.

  • B. Re-measurements arising on defined-benefit plans are recognized in other comprehensive income in the period in which they arise and are recorded as retained earnings.

  • C. The related expenses of the past service cost are immediately recognized as profit and loss.

• Termination benefits

Refer to when companies decide to terminate the employees before the normal retirement date, or when employees decide to accept the benefits in exchange for the termination. The Group recognizes expenses when it is no longer able to withdraw the offer of termination benefits or when the relevant restructuring costs are recognized, whichever is earlier. Liabilities that are not expected to be paid off within twelve months from the balance sheet date should be discounted.

1. Remuneration for employees and directors

Employees’ bonuses and directors’ remuneration are recognized as expense and liability, provided that such recognition is required under legal or constructive obligation and those amounts can be reliably estimated. Any difference between the resolved amounts and the subsequently actual distributed amounts is accounted for as changes in estimates.

(XXV) Share-based payment to employees

The share-based payment agreement for delivery of equity is a transaction in which employees’ labor service received as consideration for the Company’s equity instrument at fair value, and it is recognized as compensation costs during the vesting period, and the equity is adjusted accordingly. The fair value of equity instrument shall reflect the effects of vesting and non-vesting conditions of market value. The recognized remuneration costs are adjusted in accordance with the expected service conditions to be met and the nonvesting market value conditions, until the final recognized amount is recognized with the vesting amount on the vesting date.

~32~

(XXVI) Income tax

1. The tax expense for the period comprises current and deferred tax. Tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or items recognized directly in equity, in which cases the tax is recognized in other comprehensive income or equity.

2. The current income tax expense is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in accordance with applicable tax regulations. It establishes provisions where appropriate based on the amounts expected to be paid to the tax authorities. An additional tax is levied on the unappropriated retained earnings and is recorded as income tax expense in the year the stockholders resolve to retain the earnings.

3. Deferred income tax is recognized, using the balance sheet liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated balance sheet. However, the deferred income tax arising from the initially recognized goodwill is not accounted for if it arises from initial recognition of goodwill or of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss and does not generate taxable and deductible temporary difference. Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.

4. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. At each balance sheet date, unrecognized and recognized deferred income tax assets are reassessed.

5. Current income tax assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. Deferred income tax assets and liabilities are offset on the balance sheet when the entity has the legally enforceable right to offset current tax assets against current tax liabilities. They are levied by the same taxation authority on either the same entity or different entities that intend to settle on a net basis or realize the asset and settle the liability simultaneously.

(XXVII) Capital

1. Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or stock options are shown in equity as a deduction, net of tax, from the proceeds.

2. When the Company buys back the issued shares, the consideration paid, including any directly attributable incremental costs, is recognized as a deduction of shareholders’ equity with the net amount after tax. When the purchased shares are subsequently reissued, the difference between the consideration received and the book value after

~33~

deducting any directly attributable incremental costs and the impact of income tax is recognized as an adjustment to shareholders’ equity.

(XXVIII) Dividend distribution

Dividends are recorded in the Company’s financial statements in the period in which they are resolved by the Company’s shareholders. Cash dividends are recorded as liabilities. Stock dividends are recorded as dividends to be distributed and transferred to be common stocks on the record date of issuance of new shares.

(XXIX) Recognized revenue

1. Sales of services

The Group mainly provides photomask manufacturing and integrated circuit packaging services. The actual services provided and fees will vary according to different customers. Prices are negotiated separately before providing services, and are based on the prevailing market price. The performance obligations identified based on customer contracts are mainly for photomask manufacturing and packaging services, and revenue is recognized by measuring the degree of completion of performance obligations during the period of service provision.

With the provision of photomask manufacturing and packaging services, the customer simultaneously receives and consumes the performance benefits, and the customer has control over the asset when the asset is created or enhanced. The Group’s performance does not create any assets available for other purposes and has the exercisable right to the amount that has been completely performed till now. The related revenue is recognized by measuring the degree of completion of the performance obligation during the service period. The photomask manufacturing and packaging services are based on the input of the technical staff on the basis of the service, and the progress of completion is measured based on the percentage of the incurred cost to the estimated total cost. After the agreed service or shipment is fulfilled for the contract agreement, a bill is issued, so the contract assets are recognized when the service provided, and transferred to account receivables when the customer agrees to the Group to issue the bill.

2. Product sales

• (1) The Group manufactures and sells semiconductor-related integrated circuit products, medical equipment products, etc. The sales revenue is recognized when the control of the product is transferred to the customer. That is, once products are delivered to customers, the customers have discretion on the channel and price of product sales, and the Corporate Group has no outstanding performance obligations that may affect customers’ acceptance of the products. The delivery of products occurs when products are shipped to a designated location and the risk of obsolescence and loss has been transferred to customers, and the customers accept the products in accordance with the sales contract or have objective evidence that all criteria have been met.

• (2) The time interval between the transfer products or services promised to customers and the customers’ payment has not exceeded one year, so the Corporate Group has not adjusted the transaction price to reflect the time value of money.

• (3) Accounts receivable are recognized when goods are delivered to customers. The Corporate Group has unconditional rights to the contract price, and will be able to

~34~

collect the amount from the customers after the time has passed.

(XXX) Government subsidies

Government subsidies are recognized at fair value once it is reasonably convinced that the Company complies with the conditions for subsidies and will be receiving the subsidies. If the nature of the government subsidies is to compensate the expenses incurred by the Group, the government subsidies are recognized as current gains and losses on a systematic basis during the period in which the related expenses are incurred.

(XXXI) Business combination

1. The Corporate Group adopts the acquisition method for business combination. The combination consideration is calculated based on the fair value of transferred assets, liabilities incurred or assumed, and equity instruments issued. The transferred consideration includes the fair value of any assets and liabilities arising from contingent consideration agreed. The acquisition-related costs are recognized as expenses when incurred. The identifiable assets acquired and the liabilities assumed in a business combination are measured at the fair value on the acquisition date. The Group uses individual acquisition transactions as the basis. If the non-controlling interest is part of the current ownership interest and the holder has the right to a proportional share of the company’s net assets at the time of liquidation, it is measured at a fair value on the acquisition date or based on the proportion of identifiable assets of acquiree. Other components of non-controlling interests are measured at fair value of the acquisition date.

2. If the total fair value of transfer of consideration, non-controlling interests of acquiree and the interest of acquiree that has been held previously exceeds the fair value of identifiable assets and the assumed liabilities, it is recognized as goodwill on the acquisition date. If the identifiable assets acquired and the assumed liabilities exceed the transfer of consideration, the difference between the non-controlling interests of acquiree and the total fair value of acquiree’s interests previously held is recognized as the current profit or loss.

(XXXII) Operating segments

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the president that makes strategic decisions.

~35~

V. Critical Accounting Judgments and Key Sources of Estimation and Uncertainty

The preparation of these consolidated financial statements requires the management to make critical judgments in applying the Group’s accounting policies and make critical assumptions and estimates concerning future events. Assumptions and estimates may differ from the actual results and are continually evaluated and adjusted based on historical experience and other factors. Such assumptions and estimates have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Please see the following explanation of critical accounting judgments and key sources of estimation and uncertainty:

(I) Important judgments adopted by the accounting policies

None.

(II) Critical accounting estimates and assumptions

Evaluation of Inventories

The Group is primarily engaged in mask and integrated circuit services in the semiconductor industry. Due to rapid technological innovations, short life-cycle and competition within the mask industry, the risk of price fluctuations, Loss on decline in value of inventories and obsolescence is higher than that of other industries. The Group measures inventory based on the lower of cost and net realizable value. For inventories that are older than a certain period of age or are outdated and obsolete, the Group must use judgment and estimation to determine the net realizable value of the inventory on the balance sheet date. The valuation of inventory may undergo major changes.

As of December 31, 2023, the book value of the Corporate Group’s inventory was NT$701,823.

VI. Summary of Significant Accounting Items

(I) Cash and Cash Equivalents

Cash on hand Checking accounts and demand deposits Time deposits Total	December 31, 2023 $ 629 1,332,772 30,705 $ 1,364,106	December 31, 2022 $ 612 1,012,305 737,040 $ 1,749,957

1. The Group associates with a variety of financial institutions all with high credit quality to disperse credit risk, so it expects that the probability of counterparty default is remote.

2. The Group has no cash and cash and cash equivalents pledged to others.

~36~

(II) Financial assets and liabilities at fair value through profit or loss

Items December 31, 2023 Current items: Mandatory financial assets at fair value through profit or loss Shares of listed and OTC company $ 1,351,033 Beneficiary certificates 500 1,351,533 Valuation adjustment 275,003 $ 1,626,536 Financial liabilities mandatorily measured at fair value through profit or loss Convertible bond call/put options $ 9,383 Non-current items: Mandatory financial assets at fair value through profit or loss Shares of listed and OTC company $ 2,689,504 Shares of non-listed and non-OTC company 129,949 Private equity 75,000 2,894,453 Valuation adjustment 1,725 $ 2,896,178

December 31, 2022 $ 1,254,041 500 1,254,541 330,057 $ 1,584,598 $ 5,697 $ 2,596,725 115,338 20,000 2,732,063 164,494 $ 2,896,557

1. Details of financial assets/liabilities at fair value through profit or loss recognized in profit or loss are as follows:

or loss are as follows:
Financial assets mandatorily measured at fair value through profit or loss Shares of listed and OTC company Convertible bond call/put options Shares of non-listed and non-OTC company	($ ( ( ($	2023 115,526) 3,686) 1,196) 120,408)	($ ( (	2022 654,638) 10,697) 12,236) 677,571)
			($

1. Please see Note 8 on how the Group provides financial assets at fair value through profit or loss as a pledged collateral.

2. Please see Note 12 (2) and (3) for the price risk and fair value information related to financial assets and liabilities at fair value through profit or loss.

~37~

(III) Financial assets measured at amortized cost

Items Current items: Demand Deposit Time deposits Non-current items: Demand Deposit Time deposits Total	December 31, 2023 $ 156,629 103,256 $ 259,885 $ 377,550 282,607 $ 660,157	December 31, 2022
		$ 102,500 57,965 $ 160,465 $ 22,383 485,219 $ 507,602

1. Financial assets at amortized cost is recognized in the profit or loss shown as follows:

Interest income	2023 $ 8,570	2022 $ 9,052

1. While not considering the collaterals or other credit enhancements, the financial assets at amortized cost held by the Group had the maximum exposure of credit risk at NT$920,042 and NT$668,067 as of December 31, 2023 and 2022, respectively.

2. Please see Note 8 on how the Group provides financial assets at amortized cost as a pledged collateral.

(IV) Notes and accounts receivable

Notes Receivables Accounts Receivables Accounts Receivables－Related Parties Less: Loss allowance	December 31, 2023 $ 6,049 $ 1,508,229 26 1,508,255 ( 29,423) $ 1,478,832	December 31, 2022 $ 1,361 $ 1,521,609 2,346 1,523,955 ( 20,597) $ 1,503,358

~38~

1. Aging of accounts receivable notes receivable is as follows:

Not past due Up to 30 days 31-90 days 91-180 days More than 181 days past due	$	December 31, 2023 Accounts Receivables Notes Receivables 1,226,407 $ 6,049 171,778 - 78,432 - 11,385 - 20,253 - 1,508,255 $ 6,049	December 31, 2023 Accounts Receivables Notes Receivables 1,226,407 $ 6,049 171,778 - 78,432 - 11,385 - 20,253 - 1,508,255 $ 6,049	$	December 31, 2022 Accounts Receivables Notes Receivables 1,188,466 $ 1,361 224,106 - 85,210 - 14,582 - 11,591 - 1,523,955 $ 1,361
	$		$ 6,049	$

The above is an aging report based on the number of days past due.

1. As of December 31, 2023 and 2022, accounts receivable and notes receivable were from contracts with customers. The balances of notes and accounts receivable as of January 1, 2022 was NT$1,280,623.

2. While not considering the collaterals or other credit enhancements, the accounts receivable held by the Group had the maximum exposure of credit risk at NT$1,478,832 and NT$1,503,358, respectively, as of December 31, 2023 and 2022.

3. Please refer to Note 12 (2) for the information on credit risk of accounts receivable.

(V) Inventories

Raw materials Work in process Finished goods Merchandise Total	$	Cost 293,091 169,281 216,092 127,487 805,951	December 31, 2023 (Gain from reversal of) loss	$	Book value 247,444 155,442 179,281 119,656 701,823
			allowance on decline in market value of inventories ($ 45,647) ( 13,839) ( 36,811) ( 7,831) ($ 104,128)
	$			$

Raw materials Work in process Finished goods Merchandise Total	$	Cost 257,443 84,578 74,560 98,708 515,289	December 31, 2022 (Gain from reversal of) loss	$	Book value 179,445 75,110 36,942 91,033 382,530
			allowance on decline in market value of inventories ($ 77,998) ( 9,468) ( 37,618) ( 7,675) ($ 132,759)
	$			$

~39~

The cost of inventories recognized as losses by the Corporate Group.

Cost of goods sold $ Loss on falling prices of inventory and inventory obsolescence (gain from recovery) ( Loss on scrapping of inventory Revenue from sales of leftovers ( $	2022 5,466,608 $ 68,059) 6,327 41,310) ( 5,363,566 $	2021 5,609,401 26,310 11,169 4,387) 5,642,493

For 2023, part of the inventory for which the provision for impairment losses had been made in the previous period was sold and scrapped, resulting in a recovery in the net realizable value of the inventory, which was recognized as a decrease in operating costs.

(VI) Investment under Equity Method

Affiliates: Advagene Biopharma Co., Ltd. Weida Hi-Tech Co., Ltd.	December 31, 2023 $ 41,425 26,081 $ 67,506	December 31, 2022 $ 40,485 84,080 $ 124,565

The book value and the share of operating results of each of the Group’s insignificant affiliates are summarized as follows:

Net loss of current period from continuing operations	2023 ($ 85,789)	2022 ($ 61,296)

As of December 31, 2023 and 2022, the Group held 29.54% and 28.20% of the shares of Advagene Biopharma Co., Ltd., respectively, and 30.73% and 28.20% of the shares of Weida Hi-Tech Co., Ltd., respectively. The Group was the single largest shareholder of the companies. However, the Group did not hold a majority of the Board of Directors’ seats and therefore did not actually participate in the business decisions and operating policies, including strategic decisions (such as financing, acquisitions, personnel and dividend policies) of Advagene Biopharma and Weida Hi-Tech Co., Ltd. The Group’s shareholding alone does no reach the statutory attendance percentage of shareholders meetings, indicating that the Group has no actual ability to direct relevant activities. Therefore it is judged that the Group has no control over the companies, and only has a significant influence on them.

~40~

(VII) Property, plant and equipment

January 1, 2023 Cost Accumulated depreciation 2023 January 1 Add - Cost Disposals - Cost Disposal - Accumulated depreciation Depreciation Reclassification Increase in consolidated entities Transfer-in amount Net exchange differences - Cost Net exchange differences - Accumulated depreciation December 31 December 31, 2023 Cost Accumulated depreciation	Buildings and structures (including land) $ 2,538,391 ( 737,646) $ 1,800,745 $ 1,800,745 164,896 - - ( 188,074) 128,666 35,052 - - $ 1,941,285 $ 2,879,772 ( 938,487) $ 1,941,285	Machinery and equipment $ 5,286,246 ( 2,144,752) $ 3,141,494 $ 3,141,494 2,875,949 ( 43,409) 35,994 ( 567,664) 251,561 5,423 13 ( 7) $ 5,699,354 $ 8,379,360 ( 2,680,006) $ 5,699,354	Office equipment $ 65,406 ( 34,354) $ 31,052 $ 31,052 20,613 ( 458) 458 ( 15,756) 548 1,954 3 ( 2) $ 38,412 $ 89,028 ( 50,616) $ 38,412	Office equipment	Transportation equipment $ 8,466 ( 5,556) $ 2,910 $ 2,910 2,755 - - ( 1,282) - 550 5 ( 4) $ 4,934 $ 11,826 ( 6,892) $ 4,934	Mold equipment $ 313,370 ( 295,689) $ 17,681 $ 17,681 23,023 - - ( 7,628) 1,585 - - - $ 34,661 $ 337,978 ( 303,317) $ 34,661	Other equipment $ 595,668 ( 243,902) $ 351,766 $ 351,766 227,653 ( 126,117) 125,525 ( 94,179) 39,212 422 3 - $ 524,285 $ 764,529 ( 240,244) $ 524,285		Unfinished construction and	Total $ 9,345,560 ( 3,461,899) $ 5,883,661 $ 5,883,661 4,437,080 ( 169,984) 161,977 ( 874,583) ( 75,756) 43,401 24 ( 13) $ 9,405,807 $ 13,625,369 ( 4,219,562) $ 9,405,807
									equipment under
									$
		$			$				$
		$ ( ( (			$ ( (			(
		$			$
		$ (			$ (
		$			$

~41~

January 1, 2022 Cost Accumulated depreciation 2022 January 1 Add - Cost Disposals - Cost Disposal - Accumulated depreciation Depreciation Reclassification December 31 December 31, 2022 Cost Accumulated depreciation	Buildings and structures (including land) $ 2,327,441 ( 654,360) $ 1,673,081 $ 1,673,081 363,663 - - ( 127,097) ( 108,902) $ 1,800,745 $ 2,538,391 ( 737,646) $ 1,800,745	Machinery and equipment $ 3,631,853 ( 1,563,467) $ 2,068,386 $ 2,068,386 1,370,721 ( 391,644) 391,565 ( 354,072) 56,538 $ 3,141,494 $ 5,286,246 ( 2,144,752) $ 3,141,494	Office equipment $ 46,490 ( 21,271) $ 25,219 $ 25,219 13,473 ( 29) 29 ( 10,659) 3,019 $ 31,052 $ 65,406 ( 34,354) $ 31,052	Office equipment	Transportation equipment $ 6,544 ( 3,444) $ 3,100 $ 3,100 654 - - ( 844) - $ 2,910 $ 8,466 ( 5,556) $ 2,910	Mold equipment Other equipment $ 18,784 $ 63,751 ( 6,472) ( 5,504) $ 12,312 $ 58,247 $ 12,312 $ 58,247 6,677 40,174 - ( 65,269) - 64,352 ( 7,036) ( 16,215) 5,728 270,477 $ 17,681 $ 351,766 $ 313,370 $ 595,668 ( 295,689) ( 243,902) $ 17,681 $ 351,766		Unfinished construction and	Unfinished construction and	Total $ 6,340,879 ( 2,254,518) $ 4,086,361 $ 4,086,361 2,315,405 ( 456,942) 455,946 ( 515,923) ( 1,186) $ 5,883,661 $ 9,345,560 ( 3,461,899) $ 5,883,661
								equipment under
								$	acceptance 246,016 - 246,016 246,016 520,043 - - - 228,046) 538,013 538,013 - 538,013
					$			$
					$ ( $		(	$ $
					$ (			$
					$			$

1. The Group had no interest capitalization for investment property in 2023 and 2022.

2. The major components of the Group’s buildings and structures include land, buildings and factory renovation projects. Except for land, they are depreciated for 5 to 56 years.

3. Information on property, plant and equipment pledged to others as collateral is provided in Note 8.

4. The abovementioned property, plant and equipment of the Group are for self-use.

~42~

(VIII) Leasing arrangements - lessee

1. The underlying assets leased by the Group include land, buildings and company vehicles. Leasing contracts are typically made for periods of 3 to 20 years. Lease contracts are negotiated separately and include a variety of terms and conditions. There are no restrictions for the leased assets, except that they cannot be used as loan collaterals.

2. The lease periods of other equipment leased by the Group did not exceed 12 months.

3. The carrying amount of right-of-use assets and the depreciation charge are as follows:

Land Buildings and structures Transportation equipment (company vehicles) Other equipment Land Buildings and structures Transportation equipment (company vehicles) Other equipment	December 31, 2023 Book value $ 481,191 18,226 15,407 39,806 $ 554,630 2023 Depreciation $ 25,710 14,125 12,043 3,583 $ 55,461	December 31, 2022 Book value $ 507,948 1,018 16,241 25,404 $ 550,611 2022 Depreciation $ 25,727 11,781 9,640 1,854 $ 49,002

1. The increase in the right-of-use assets was NT$52,886 and NT$16,769 for 2023 and 2022, respectively.

2. The information on profit or loss items related to lease contracts is as follows:

Items affecting current profit and loss Interest expenses on lease liabilities Expenses for short-term lease contracts Lease of low-value assets	2023 $ 7,345 6,534 4,491	2022 $ 7,012 6,283 2,785

1. The Group’s total cash outflow on leases for 2023 and 2022 was NT$70,186 and NT$71,636, respectively.

2. Options to extend or terminate leases

In determining lease terms, the Group takes into consideration all facts and circumstances that create economic incentives to exercise an option to extend or terminate leases. The

~43~

assessment of lease period is reviewed if a significant event occurs which affects the assessment of options to extend or options not to terminate.

• (IX) Leasing arrangements - lessor

• The Group leases out assets such as buildings. The lease contracts are typically made for periods of 1 to 2 years. The terms of lease contracts are negotiated separately and include various terms and conditions. In order to preserve the condition of leased assets, the Group usually requires lessees not to pledge the underlying leased assets.

• The Group recognized rental income of NT$20,580 and NT$19,276 based on operating lease contracts in 2023 and 2022, respectively, and none of the lease contracts were variable lease payments.

• The maturity analysis of the undiscounted lease payments under the operating leases is as follows:

2023 2024	December 31, 2023 $ - 16,674 $ 16,674	December 31, 2022 $ 14,476 786 $ 15,262

(X) Real estate investment

January 1, 2023 Cost Accumulated depreciation 2023 January 1 Reclassification for the period -- Cost Reclassification for the period -- Accumulated depreciation Depreciation December 31 December 31, 2023 Cost Accumulated depreciation	Buildings and structures $ 185,942 ( 15,596) $ 170,346 $ 170,346 6,234 ( 2,720) ( 3,360) $ 170,500 $ 192,176 ( 21,676) $ 170,500

~44~

January 1, 2022 Cost Accumulated depreciation 2022 January 1 Depreciation December 31 December 31, 2022 Cost Accumulated depreciation	Buildings and structures $ 185,942 ( 12,328) $ 173,614
	$ 173,614 ( 3,268) $ 170,346
	$ 185,942 ( 15,596) $ 170,346

1. Rental income and direct operating expenses of investment real estate:

Rental income from investment property Direct operating expenses incurred by investment properties that generate rent income in the period	2023 $ 19,224 $ 3,436	2022 $ 16,436 $ 2,641

1. The fair value of the investment property held by the Group as of December 31, 2023 and 2022 were NT$160,853 and NT$165,392, respectively. They were valuated using the income method and were of Level 3 fair value, and the major assumptions are as follows:

Discount rate Annual rent (net income) Number of years	December 31, 2023 3.75%~5.56% $ 19,092 45~50	December 31, 2022
		7.09% $ 11,285 45~50

1. No capitalization of interest for investment property in 2023 and 2022.

2. As of December 31, 2023 and 2022, the investment properties had been used as collaterals. Please refer to Note 8.

~45~

(XI) Intangible assets

January 1 Cost Accumulated amortization and impairments January 1 Consolidated transfer in Add - Cost Disposals - Cost Reclassification Amortization expense December 31 December 31 Cost Accumulated amortization and impairments	2023 trademark and concession Computer software $272,017 $114,747 ( 47,408) ( 64,846) $224,609 $ 49,901 $224,609 $ 49,901 - - - 36,321 - - 5,387 ( 6,830) ( 28,464) ( 23,525) $201,532 $ 55,867 $280,614 $139,950 ( 79,082) ( 84,083) $201,532 $ 55,867	$ (	Patents 9,592 7,696) 1,896 1,896 - 654 1,544) 1,443 506) 1,943 6,165 4,222) 1,943	Goodwill $220,774 - $220,774 $220,774 241,294 - - - - $462,068 $462,068 - $462,068	Total $617,130 ( 119,950) $497,180 $497,180 241,294 36,975 ( 1,544) - ( 52,495) $721,410 $888,797 ( 167,387) $721,410
	concession $272,017 ( 47,408) $224,609 $224,609 - - - 5,387 ( 28,464) $201,532 $280,614 ( 79,082) $201,532
		$
		$ ( (
		$
		$ (
		$

~46~

January 1 Cost Accumulated amortization and impairments January 1 Addition - From separate acquisition Acquisition Amortization expense December 31 December 31 Cost Accumulated amortization and impairments	2022 trademark and concession Computer software $272,017 $ 68,980 ( 9,506) ( 59,318) $262,511 $ 9,662 $262,511 $ 9,662 - 45,767 ( 37,902) ( 5,528) $224,609 $ 49,901 $272,017 $114,747 ( 47,408) ( 64,846) $224,609 $ 49,901	$ (	Patents 9,592 5,735) 3,857 3,857 - 1,961) 1,896 9,592 7,696) 1,896	Goodwill $220,774 - $220,774 $220,774 - - $220,774 $220,774 - $220,774	Total $571,363 ( 74,559) $496,804 $496,804 45,767 ( 45,391) $497,180 $617,130 ( 119,950) $497,180
	concession $272,017 ( 9,506) $262,511 $262,511 - ( 37,902) $224,609 $272,017 ( 47,408) $224,609
		$
		$ (
		$
		$ (
		$

Due to business mergers, as detailed in Note 6(31), the Group’s goodwill increased by NT$241,294 for 2023.

(XII) Other Non-Current Assets

Prepayments for equipment Refundable deposit Others Total	December 31, 2023 $ 422,444 90,526 1,669 $ 514,639	December 31, 2022
		$ 1,293,001 52,758 3,378 $ 1,349,137

~47~

(XIII) Short Term Loans

Type of borrowings	December 31, 2023 $ 1,657,862 3,741,508 30,000 $ 5,429,370 December 31, 2022 $ 1,618,197 3,006,328 -	Range of interest rate 0.88%~4.01% 1.20%~4.71% 2.700% Range of interest rate 1.06%~2.68% 1.25%~2.75%	Collateral None Certificates of deposit, reserve accounts (Note), stocks of listed and OTC companies and treasury stock None Collateral None Certificates of deposit, reserve accounts, stocks of listed and OTC companies, treasury stock and investment properties.
Bank borrowings Credit loan Secured borrowings Other borrowings Credit loan Type of borrowings
Bank borrowings Credit loan Secured borrowings
	$ 4,624,525

The interest expenses recognized in profit and loss in 2023 and 2022 were NT$126,371 and NT$77,598, respectively.

Note: The responsible person of the subsidiary is the joint guarantor.

(XIV) Other Payables

Payable on machinery and equipment Payroll and bonus payable Remunerations payable to employees and directors Machine maintenance payable Others	December 31, 2023 $ 498,861 153,545 94,305 44,906 413,536 $ 1,205,153	December 31, 2022
		$ 111,919 111,894 129,630 51,362 432,408 $ 837,213

~48~

(XV) Corporate bonds payable

Corporate bonds payable Less: Amount of exercised conversion options Less: Discount on corporate bonds payable Less: Corporate bonds matured in one year or a business cycle or have the put option exercised	December 31, 2023 $ 3,800,000 ( 324,400) ( 51,000) 3,424,600 - $ 3,424,600	December 31, 2022
		$ 3,000,000 ( 324,400) ( 66,556) 2,609,044 - $ 2,609,044

1. The terms of issuance for the Group’s 3rd domestic unsecured convertible bonds are as follows:

2. (1) The Group has been approved by the competent authority to raise and issue $2,000,000 of the 3rd domestic unsecured convertible bonds, with a coupon rate of 0% and an issuance period of 5 years from August 3, 2021 to August 3, 2026. The convertible bonds are repayable in cash at par value on maturity. The convertible bonds were listed for trading on August 3, 2021.

3. (2) The bondholders may request the conversion of the convertible bonds into the Group’s common shares at any time from the day after the expiration of three months from the date of issuance of the corporate bonds to the maturity date, except during the period when the transfer of the corporate bonds is suspended in accordance with the regulations or laws, and the rights and obligations of the converted common shares are the same as those of the original issued common shares.

4. (3) The conversion price of the convertible bonds is determined in accordance with the pricing model stipulated in the Measures, and the conversion price will be adjusted in accordance with the pricing model stipulated in the Conversion Measures in the event that the Group is subject to anti-dilution provisions. The conversion price will be reset on the base date set by the Regulations in accordance with the pricing model stipulated in the Conversion Measures. As of December 31, 2023, the conversion price was NT$82.4 per share.

5. (4) If the closing price of the Company’s common stock exceeds 30% of the then conversion price for 30 consecutive business days from the day following the third month of the issuance of the convertible bonds to the 40th business day prior to the expiration of the issuance period, the Company may redeem the outstanding corporate bonds within the next 30 business days at the par value of the corporate bonds in cash.

6. (5) If the outstanding balance of the convertible bonds is less than 10% of the total par value of the corporate bonds issued, the Company may redeem the convertible bonds at any time thereafter for cash at the par value of the corporate bonds, from the day following the third month of the issuance of the corporate bonds to the 40th business

~49~

day prior to the expiration of the issuance period.

• (6) As of December 31, 2023, a total amount of NT$324,400 had been converted into 3,733 thousand shares of common stock.

• Upon issuance of convertible bonds, the Group separated the conversion options from the components of liabilities in accordance with IAS 32, “Financial Instruments: Presentation,” and recorded “capital surplus - stock options” at $406,616. The embedded repurchase and repurchase rights are separated from the principal contractual debt instruments in accordance with IFRS 9, “Financial Instruments”, because they are not closely related to the economic characteristics and risks of the principal contractual debt instruments, and are recorded as “financial assets or liabilities at fair value through profit or loss” on a net basis. The effective interest rate of the master contract debt after the separation was 0.0902%.

• First series domestic secured corporate bonds

• In order to raise the Group’s working capital, the board of directors resolved to approve on August 5, 2022 the issue of the first series domestic secured corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount of issue: According to the different issue conditions, there are two types of bonds, A and B, of which A is issued with an amount of $300,000, and B is issued with an amount of $200,000, totaling $500,000.

• (2) Issue period: Five years, issued on September 28, 2022, and matured on September 28, 2027.

• (3) Coupon rate and repayment method of principal and interest: Both Bond A and Bond B have a fixed annual coupon rate of 1.80%. Simple interest is calculated and paid once a year, and the principal is repaid in cash at the face value of the bond at maturity.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Second series domestic secured convertible corporate bonds

In order to raise the Group’s working capital, the board of directors resolved to approve on August 5, 2022 the issue of the second series domestic secured convertible corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount of issuance: According to the different issue conditions, there are two types of bonds, A and B, of which A is issued with an amount of $200,000, and B is issued with an amount of $300,000, totaling $500,000.

• (2) Issue period: Five years, issued on December 27, 2022, and matured on December 27, 2027.

• (3) Coupon rate and repayment method of principal and interest: Bond A has a fixed annual coupon rate of 2.20% and Bond B has a fixed annual coupon rate of 2.38%. Simple interest is calculated and paid once a year, and the principal is repaid in cash at the face value of the bond at maturity.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Third series domestic secured convertible corporate bonds

~50~

In order to raise the Group’s working capital, the board of directors resolved to approve on August 4, 2023 the issue of the third series domestic secured convertible corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount issued: NT$300,000 in total.

• (2) Issuance period: Five years from issuance on August 28, 2023 to expiration on August 28, 2028.

• (3) Coupon rate and method of repayment of principal and interest: The coupon rate is a fixed interest rate of 1.62% per annum, and the simple interest is calculated once a year. At maturity, the principal is repaid in cash based on the face value of the bond.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

• Fourth series domestic secured convertible corporate bonds

In order to raise the Group’s working capital, the board of directors resolved to approve on August 4, 2023 the issue of the fourth series domestic secured convertible corporate bond. The issue has been reported to and approved by the Taipei Exchange, and the terms are as follows:

• (1) Total amount issued: NT$500,000 in total.

• (2) Issuance period: Five years from issuance on December 12, 2023 to expiration on December 12, 2028.

• (3) Coupon rate and method of repayment of principal and interest: The coupon rate is a fixed interest rate of 1.8% per annum, and the simple interest is calculated once a year. At maturity, the principal is repaid in cash based on the face value of the bond.

• (4) Guarantee method: The Company’s bonds are guaranteed by the joint delegation guarantee contract signed and the obligation and the contract of guarantee for the performance of corporate bonds signed by major banks.

~51~

- (XVI) Long term borrowings

Type of borrowings Long-term bank Secured borrowings Secured borrowings Secured borrowings Secured borrowings Credit loan Other long-term Secured borrowings Secured borrowings Credit loan Less: Long-term	Borrowing period and payment method Range of interest rate Collateral borrowings From December 27, 2021 to December 27, 2032, to be repaid in installments and installments over the agreed period 2.20%~2.55% Buildings and structures and investment properties From January 28, 2022 to January 28, 2027, to be repaid in installments and installments over the agreed period 2.55% Buildings and structures, machinery equipment and investment property From July 26, 2023 to July 25, 2038, with interest paid monthly 2.45%~2.55% Plant and land From June 12, 2018 to July 05, 2028, to be repaid in installments and installments over the agreed period 2.25%~4.33% Machinery and equipment From January 24, 2022 to January 24, 2027, monthly interest payments with principle and interest 1.50%~3.00% None (Note) borrowings From March 25, 2021 to July 29, 2027, to be repaid in installments and installments over the agreed period 2.45%~8.20% Machinery and equipment From June 10, 2022 to June 28, 2028, with interest paid monthly 3.53%~6.48% Houses, buildings, machinery and equipment, and land From December 30, 2021 to June 30, 2025, to be repaid in installments and installments over the agreed period 4.19%~7.80% None borrowings due within one year or one business cycle)	December 31, 2023 $ 1,005,263 1,000,000 127,600 983,360 6,318 610,369 393,143 216,503 - 4,342,556 ( 1,216,216) $ 3,126,340

~52~

Type of borrowings Long-term bank Secured borrowings Secured borrowings Secured borrowings Secured borrowings Secured borrowings

Borrowing period and payment method Range of interest rate Collateral December 31, 2022 borrowings From December 28, 2021 to January 28, 2027, repayable in portions and in installments during the term specified in the agreement 2.43% Buildings and structures and machine and equipment $ 1,250,000 From December 27, 2021 to December 27, 2024, repayable in portions and in installments during the term specified in the agreement 2.41% Buildings and structures 250,000 Repayable in portions and in installments during the term specified in the agreement from June 12, 2018 to December 15, 2026 1.73%~ 3.13% Machinery and equipment 1,050,407 From December 28, 2022 to December 27, 2032, repayable in portions and in installments during the term specified in the agreement 2.07% Buildings and structures and investment properties 850,000 From January 24, 2022 to January 24, 2027, monthly interest payments with principle and interest 1.50%~2.88 % None (Note) 8,247

~53~

Type of borrowings Other long-term Secured borrowings Secured borrowings Credit loan Secured borrowings Less: Long-term business cycle)	Borrowing period and payment method Range of interest rate Collateral borrowings Principal is amortized from October 29, 2021 to September 16, 2027 3.97% Machinery and equipment Repayment of principal and interest in monthly installments from March 25, 2021 to July 29, 2027 2.45%~ 8.20% Machinery and equipment December 30, 2021 to April 30, 2024, the interest is paid together with the principal. 7.610% None Repayment of principal and interest in monthly installments from July 10, 2022 to June 10, 2027 4.25% Machinery and equipment borrowings due within one year or one	December 31, 2022 89,655 90,068 14,240 176,830 - 3,779,447 ( 611,473) $ 3,167,974

Note: The responsible person of the subsidiary is the joint guarantor.

(XVII) Pensions

1. (1) The Company and its domestic subsidiaries operate a defined benefit pension plan in accordance with the Labor Standards Act, which cover all regular employees’ service years prior to the enforcement of the Labor Pension Act on July 1, 2005 and service years thereafter of employees who chose to continue to be subject to the pension mechanism under the Labor Standards Act. Under the defined benefit pension plan, two units are accrued for each year of service for the first 15 years and one unit for each additional year thereafter, subject to a maximum of 45 units. Pension benefits are based on the number of units accrued and the average monthly salaries and wages of the last six months prior to retirement. The Company and its domestic subsidiaries contribute a monthly amount equal to 2% of employees’ monthly salaries and wages to a retirement fund at the Bank of Taiwan, the trustee, under the name of the independent retirement fund committee. Also, the Company and its domestic subsidiaries would assess the balance in the aforementioned labor pension reserve account by December 31, every year. If the account balance is not enough to pay the pension calculated by the aforementioned method to the employees expected to qualify for retirement in the following year, the Company and its domestic subsidiaries will make contribution for the deficit by the end of next March.

~54~

• (2) The amounts recognized in the balance sheet are as follows:

Present value of defined benefit obligations Fair value of plan assets Defined Benefit Liabilities	December 31, 2023 ($ 22,650) 12,417 ($ 10,233)	December 31, 2022
		($ 21,458) 5,861 ($ 15,597)

• (3) The subsidiary, Miracle Technology Co., Ltd., has reached an agreement with the employees subject to the old pension system to settle the seniority payment under this system in accordance with the Labor Standards Act and the Labor Pension Act. This was approved by Hsinchu County Government on October 20, 2022. Checks were received from the retirement reserve funds under custody of the Bank of Taiwan on August 4, 2023 in accordance with paragraph 9 of the Regulations for the Allocation and Management of the Workers’ Retirement Reserve Funds. The over-payment to the employees’ retirement reserve funds determined after settlement of the seniority payment for the employees was recognized as pension profit of $326.

• (4) Changes in net defined benefit liabilities are as follows:

2023 Balance on January 1 Interest (expense) income Re-measurements: Return on plan assets (excluding amounts included in interest income or expense) Change in financial assumptions Experience adjustments Pension fund contribution Balance on December 31	Present value of defined benefit obligations ($ 21,153) ( 296) ( 21,449) - ( 251) ( 950) ( 1,201) - ($ 22,650)	Fair value of plan Defined Benefit	Fair value of plan Defined Benefit
		assets $ 4,947 84	Liabilities ($ 16,206) ( 212) ( 16,418) 56 ( 251) ( 950) ( 1,145) 7,330 ($ 10,233)
		5,031
		56 - -
		56
		7,330
		$ 12,417

Note: The subsidiary, Miracle Technology Co., Ltd., settled the labor pension reserve funds in August 2023, so only the changes in the Company’s net defined benefit liabilities were disclosed in 2023.

~55~

2022 Balance on January 1 Current service cost Interest (expense) income Re-measurements: Return on plan assets (excluding amounts included in interest income or expense) Change in financial assumptions Experience adjustments Pension fund contribution Paid pension Balance on December 31	2022 Present value of defined benefit obligations ($ 22,899) ( 61) ( 171) ( 23,131) - 1,646 ( 4,773) ( 3,127) - 4,800 ($ 21,458)	Fair value of plan assets $ 7,990 - 67	Defined Benefit
			Liabilities ($ 14,909) ( 61) ( 104) ( 15,074) 471 1,646 ( 4,773) ( 2,656) 2,133 - ($ 15,597)
		8,057 471 - - 471
		2,133 ( 4,800) $ 5,861

• (5) The Bank of Taiwan was commissioned to manage the Fund of the Company’s defined benefit pension plan in accordance with the Fund’s annual investment and utilization plan and the “Regulations for Revenues, Expenditures, Safeguard and Utilization of the Labor Retirement Fund” (Article 6: The scope of utilization for the Fund includes deposit in domestic or foreign financial institutions, investment in domestic or foreign listed, over-the-counter or private placement equity securities, investment in domestic or foreign real estate securitization products, etc.). With regard to the utilization of the Fund, its minimum earnings in the annual distributions on the final financial statements shall be no less than the earnings attainable from the amounts accrued from two-year time deposits with the interest rates offered by local banks. If the earnings are less than the aforementioned rates, government shall make payments for the deficit after being authorized by the Regulator. The Company has no right to participate in managing and operating the fund and hence the Company is unable to disclose the classification of fair value of plan asset in accordance with IAS19 paragraph 142. The composition of fair value of plan assets as of December 31, 2023 and 2022 is given in the Annual Labor Retirement Fund Utilization Report announced by the government.

~56~

(6) The principal actuarial assumptions used were as follows:

Discount rate Future salary increases	2023 1.3% 2.125%	2022 1.4% 2.125%

Assumptions for 2023 and 2022 regarding future mortality experience are set based on the Taiwan Standard Ordinary Experience Mortality Table.

Because the main actuarial assumption changes, the present value of defined benefit obligation is affected. The analysis is as follows:

December 31, 2023 Effect on present value of defined benefit obligation December 31, 2022 Effect on present value of defined benefit obligation	($	Discount 0.25% increase 637) $ 641) $	Discount	Discount	rate 0.25% decrease 661 666	$	Future salary increases 0.25% increase 0.25% decrease 640 ($ 620) 646 ($ 626)	Future salary increases 0.25% increase 0.25% decrease 640 ($ 620) 646 ($ 626)
				$			0.25% increase 640 646	($
	($			$		$		($

The sensitivity analysis above analyzes the impact from changing one of the assumptions while others remain constant. In practice, more than one assumption may change all at once. The sensitivity analysis is the same with the method used to calculate the net pension liabilities of the balance sheet.

• (7) The expected contributions to the defined benefit pension plans of the Group for the year ending December 31, 2024 are $2,133.

• (8) As of December 31, 2023, the weighted average duration of the retirement plan is 12 years.

• (1) Effective July 1, 2005, the Company and its domestic subsidiaries have established a defined contribution pension plan (hereinafter referred to as the “New Plan”) under the Labor Pension Act (hereinafter referred to as the “Act”), covering all regular employees with domestic citizenship. Under the New Plan, the Company and its domestic subsidiaries contribute an amount based on 6% of the employees’ monthly salaries and wages to the employees’ individual pension accounts at the Bureau of Labor Insurance. The benefits accrued are paid monthly or in lump sum upon termination of employment.

• (2) For 2023 and 2022, the pension costs recognized by the Corporate Group in accordance with the abovementioned pension measures were NT$41,918 and NT$35,520, respectively.

~57~

(XVIII) Capital

1. As of December 31, 2023, the Company’s authorized capital was NT$5,000,000, consisting of 500,000 thousand shares (including 20,000 thousand shares which can be subscribed to as employee stock options). The paid-in capital was NT$2,564,465 with a par value of NT$10. All proceeds from shares issued have been collected.

The movements in the number of the Company’s common stocks outstanding are as follows:

Unit: Thousand shares

January 1 Conversion of convertible bonds Treasury stocks transfer to employees Treasury Stock Buyback Subsidiaries donated treasury stock December 31		2023 205,230 - 7,023 - 900 213,153	(	2022 214,107 773 - 10,000) 350 205,230

1. Treasury stock

2. (1) Reasons for repurchase of shares and changes in the quantity:

Company name of the shareholding Subsidiary: Youe Chung Capital Corporation The Company Company name of the shareholding Subsidiary: Youe Chung Capital Corporation The Company	Reasons for buyback Subsidiary holds the company’s stock Transfer shares to employees Reasons for buyback Subsidiary holds the company’s stock Transfer shares to employees		December 31, 2023 Number of shares (thousand) Book value 35,831 $ 509,891 7,462 664,593 43,293 $1,174,484 December 31, 2022 Number of shares (thousand) Book value 36,731 $ 522,698 14,485 1,256,281 51,216 $1,778,979

~58~

• (2) For 2023 and 2022, the Group’s share-based payment arrangements were as follows:

Type of arrangement Transfer of treasury shares to employees Transfer of treasury shares to employees	Grant date 111.01.26 112.04.19	Quantity granted 4,485 10,000	Contract Period Immediate vesting Immediate vesting	Vesting conditions Note Note

Note: The Company grants treasury stocks to employees of the Company and its subsidiaries.

• (3) Remuneration costs related to the transfer of treasury stocks of the Group in 2023 and 2022 were NT$0 and NT$19,061, respectively

• (4) The Securities and Exchange Act stipulates that the percentage of the Company’s repurchase of outstanding shares shall not exceed 10% of the Company’s total issued shares, and the total value of shares purchased shall not exceed the retained earnings plus the premium of issued shares and the amount of realized capital reserve.

• (5) The treasury stocks bought back by the Company in accordance with the Securities and Exchange Act shall not be pledged. Before transfer, shareholders are not entitled to the shareholders’ rights.

• (6) According to the provisions of the Securities and Exchange Act, the share repurchased to be transferred to employees shall be transferred within 5 years from the date of the purchase. If the transfer is not made within the time limit, the shares are deemed as unissued shares and a change of registration shall be made to cancel the shares. In order to maintain the Company’s credit and shareholders equity, the shares bought back should have the registration changed to cancel the shares within six months from the date of the purchase.

• (7) The Company’s stock held by the subsidiary Youe Chung Capital is treated as treasury stock. As of December 31, 2023 and 2022, Youe Chung Capital held 35,831 thousand and 36,731 shares, respectively, of the Company. The average book value per share was NT$14.23, and the fair value per share was NT$71.1 and NT$84., respectively. The cost of transferring treasury stocks is calculated based on the book value of the Company’s stock held by Youe Chung Capital and the Company’s indirect ownership ratio during each period.

• (8) On November 3, 2021, the Board of Directors resolved to purchase 6,000 thousand shares of the Company’s stock in the centralized trading market and transfer them to employees. This amount represented 2.37% of the total number of issued shares of the Company. The repurchase of 4,485 thousand shares was completed between November 4, 2021 and January 3, 2022. On January 21, 2022, the Board of Directors approved the transfer of 4,485 thousand shares to employees.

• (9) On May 6, 2022, the Board of Directors resolved to purchase 10,000 thousand shares of the Company’s stock in the centralized trading market and transfer them to employees. This amount represented 3.91% of the total number of issued shares of the Company. The repurchase of 10,000 thousand shares was completed between May 9, 2022 and July 8, 2022. On April 14, 2023, the Board of Directors approved the transfer of 10,000 thousand shares to employees, of which 7,023 shares were

~59~

transferred to employees in June 2023.

(XIX) Capital surplus

In accordance with the Company Act, any capital surplus arising from paid-in capital in excess of the par value on issuance of common stocks and donations can be used to cover accumulated deficit or to issue new stocks or cash to shareholders in proportion to their share ownership, provided that the Company has no accumulated deficit. Further, the Securities and Exchange Act requires that the amount of capital surplus to be capitalized, as above, should not exceed 10% of paid-in capital each year. Capital reserves should not be used to cover accumulated deficit unless the legal reserve is insufficient. The following is a breakdown of the capital reserve:

January 1, 2023 Distribution of cash from capital surplus Adjustment of capital reserve by dividends paid to subsidiaries Changes in ownership interests in subsidiaries recognized Changes in shares of affiliates recognized under the equity method Payment of overdue unclaimed dividends to shareholders December 31, 2023	Issue premiums $96,650 ( 49,797) - ( 2,705) - - $44,148	Trading of treasury stock $768,509 - 90,829 - - - $859,338		Changes in ownership interests in subsidiaries	stock option $295,848 - - - - - $295,848	Equity changes in affiliates $ 68,427 - - - 13,793 - $ 82,220	Others $4,459 - - - - ( 151) $4,308	Total $1,251,681 ( 49,797) 90,829 133,604 13,793 ( 151) $1,439,959
				recognized $ 17,788 - - 136,309 - - $ 154,097
						$

~60~

Issue premiums January 1, 2022$269,010 Conversion of convertible bonds 68,829 Distribution of cash from capital surplus (241,189) Adjustment of capital reserve by dividends paid to subsidiaries - Changes in ownership interests in subsidiaries recognized - Changes in shares of affiliates recognized under the equity method - Share-based payment transaction - - December 31, 2022 $96,650	Trading of treasury stock $695,046 - - 73,463 - - - - $768,509	Trading of treasury stock		Changes in ownership interests in subsidiaries	stock option $295,074 ( 13,357) - - - - 14,131 - $295,848	stock option	Equity changes in affiliates $ 47,320 - - - - 21,107 - - $ 68,427	Others $4,459 - - - - - - - $4,459	Total $1,315,828 55,472 ( 241,189) 73,463 10,169 21,107 16,831 -
				recognized $ 4,919 - - - 10,169 - 2,700 - $ 17,788
									$1,251,681

(XX) Retained earnings

1. According to the Articles of Incorporation, any surplus from profit concluded at the end of year by the Company is first subject to reimbursement of previous losses and payment of taxes, followed by 10% provision for legal reserve and provision or reversal of special reserve as the laws may require. Any earnings remaining shall be distributed as shareholders’ dividends in whole or partially.

2. The Company takes into account the overall business environment, industrial growth, and the Company’s long-term financial planning for stable operation and development to adopt a residual dividend policy, which is mainly based on the Company’s future capital budgeting plan to measure the annual capital needs. After using the retained earnings for funding, the remaining surplus will be distributed in the form of dividends, and the distribution steps are shown as follows:

3. (1) Decide on the best capital budgeting.

4. (2) Decide on the financing required for one of the capital budgeting items.

5. (3) Decide on the amount of the financing to be supported by retained earnings (methods such as cash capital increase or corporate bonds and so on can be adopted as support).

6. (4) After retaining the portion required for operation needs out of the earnings remainder, the rest should be distributed to shareholders in the form of dividends. Cash dividends

~61~

distribution proportion should not be lower than 20% of the total amount of dividends for the distribution proportion of the Company’s dividends.

1. Except for covering accumulated deficit or issuing new stocks or cash to shareholders in proportion to their share ownership, the legal reserve shall not be used for any other purpose. The use of the legal reserve for the issuance of stocks or cash to shareholders in proportion to their share ownership is permitted, provided that the distribution of the reserve is limited to the portion in excess of 25% of the Company’s paid-in capital.

2. In accordance with the regulations, the Company shall set aside special reserve from the debit balance on other equity items at the balance sheet date before distributing earnings. When debit balance on other equity items is reversed subsequently, the reversed amount could be included in the distributable earnings.

3. The Company’s Board meeting resolved on March 6, 2024 to distribute a cash dividend of NT$1.5 per common share from the 2023 earnings, with a total dividend of NT$373,477.

4. The Company’s board of directors resolved on May 24, 2023 to distribute a cash dividend of NT$2.30 per ordinary share from the 2022 surplus with a total dividend of NT$556,511. NT$0.20 per share is to be distributed from the capital surplus, with a total of NT$48,392. In addition, as the Company implemented the transfer of 7,023 thousand shares of treasury stock to employees, which changed the number of outstanding shares to 248,984 thousand shares, so the cash dividend was adjusted to $572,665 to be distributed from the capital surplus of $49,797.

5. The Company’s board of directors resolved on May 26, 2022 to distribute a cash dividend of NT$1.00 per ordinary share from the 2021 surplus with a total dividend of NT$255,674. NT$1.00 per share is to be distributed from the capital surplus, with a total of NT$255,674. In addition, as the Company implemented the repurchase of 14,485 thousand shares of treasury stock, which changed the number of outstanding shares to 241,189 thousand shares, so the cash dividend was adjusted to $241,189 to be distributed from the capital surplus of $241,189.

(XXI) Other equity interests

			2023
			Foreign
	Unrealized	Hedging	currency
	gains and losses	reserve	translation	Total
January 1	($ 2,666)		$ 13,174	$ 10,508
Difference in
foreign currency
translation:
- Group	-		( 8,867)	( 8,867)
December 31	($ 2,666)		$ 4,307	$ 1,641

~62~

January 1 Difference in foreign currency translation: - Group December 31	Unrealized gains and losses ($ 2,666) - ($ 2,666)	2022 Foreign currency	Total $ 4,032 6,476 $ 10,508
		translation $ 6,698 6,476 $ 13,174

(XXII) Operating income

Revenue from contracts with customers

2023 $ 7,199,935	$	2022 7,741,118

1. Segmentation of revenue from contracts with customers

The Group’s corporate derives its revenue from the transfer of goods and services either over time or at a point in time. The revenue can be divided into the following main product lines:

2023 Revenue from contracts with external customers Cut-off point of income recognition Income recognized at a particular point in time Income recognized gradually over time 2022 Revenue from contracts with external customers Cut-off point of income recognition Income recognized at a particular point in time Income recognized gradually over time	Photomask and semiconductor segment $ 7,079,202 $ 2,664,084 4,415,118 $ 7,079,202 Photomask and semiconductor segment $ 7,684,054 $ 3,104,772 4,579,282 $ 7,684,054	Medical segment $ 120,733 $ 120,733 - $ 120,733 Medical segment $ 57,064 $ 57,064 - $ 57,064	Total $ 7,199,935
			$ 2,784,817 4,415,118 $ 7,199,935
			Total $ 7,741,118 $ 3,161,836 4,579,282
			$ 7,741,118

2. Contract Asset and Contract Liability

• (1) The Group has recognized the following revenue-related contract assets and contract liabilities:

~63~

Contract Assets Contract Liabilities	December 31, 2023 $ 105,263 $ 174,538	December 31, 2022 $ 140,231 $ 232,778	January 1, 2022 $ 155,763 $ 179,315

(XXIII) (XXIV) (XXV)

(2) Contract liabilities at the beginning of the period recognized as revenue of the period: 2023 2022 Opening balance of contract liabilities recognized as income for current period $ 228,725 $ 114,475 Interest income 2023 2022 Interest from bank deposits $ 32,031 $ 16,168 Interest income from financial assets measured at amortized cost 8,570 9,052 Other interest incomes 141 51 $ 40,742 $ 25,271 Other Incomes 2023 2022 Rental income $ 20,580 $ 19,456 Dividend income 94,064 194,598 Subsidy income 5,335 - Other income - Others 13,864 44,201 $ 133,843 $ 258,255 Other Gains and Losses 2023 2022 Disposal of interests in property, plant and equipment $ 688 $ 5,024 Gains on disposal of intangible assets 25,499 - Gain (loss) on disposal of investments 101,102 123,552 Gain on lease modifications - 103 Foreign currency exchange gains (losses) ( 1,281) 76,984 Loss on financial assets and liabilities measured at fair value through profit or loss ( 221,510) ( 801,123) Other losses -- Depreciation of investment properties ( 3,360) ( 3,268) Other Gains and Losses 473 ( 20,519) ($ 98,389) ($ 619,247)

~64~

(XXVI) Financial Costs

		2023		2022
	Interest Expenses:
	Bank and other borrowings	$	242,466	$	152,431
	Convertible bonds		43,376		18,103
	Lease liabilities		7,345		7,012
	Others		51		-
		$	293,238	$	177,546
(XXVII) Expenses by nature
		2023		2022
	Employee benefits expenditure	$	1,269,619	$	1,393,688
	Depreciation		933,404		568,193
	Amortization		52,495		45,391
(XXVIII)	Employee benefits expenditure
		2023		2022
	Payroll expenses	$	1,067,910	$	1,152,751
	Share-based payment		-		19,061
	Labor and health insurance fees		95,506		116,437
	Pension expense		42,130		35,684
	Other personnel expenses		64,073		69,755
		$	1,269,619	$	1,393,688

1. According to the Articles of Incorporation, the Company shall distribute not less than 10% of the current year’s profit situation for employee remuneration and not more than 2% of current year’s profit situation for director remuneration. However, profits must first be taken to offset against cumulative losses, if any.

2. For 2023 and 2022, employee remuneration was accrued at NT$80,000 and NT$102,000, respectively, and director remunerations was accrued at NT$12,000 and NT$18,000, respectively. The amounts were listed as payroll expenses.

The remuneration of employees and directors for 2023 and 2022 were estimated in accordance with the Articles of Incorporation taking into account the annual profit.

The 2022 remuneration for employees, directors and supervisors as resolved by the Board of Directors are consistent with the amounts recognized in the 2022 financial statements.

Information about employees remuneration and director remuneration of the Company as resolved by the Board of Directors is available on the MOPS.

~65~

(XXIX) Income tax

1. Income tax expense

Components of income tax expense:

come tax 1. Income tax expense Components of income tax expense:
	2023			2022
Current tax:
Current tax on profits for the year	$		217,647	$	236,441
Additional surtax on undistributed			1,924		-
earnings
Underestimation (overestimation) of
income tax in previous years			68,826	(	17,190)
Total current tax			288,397		219,251
Deferred income tax:
Origination and reversal of temporary
differences	(		6,881)		8,830
Total Deferred Income Tax	(		6,881)		8,830
Income Tax Expense	$		281,516	$	228,081
2. Reconciliation between income tax expense and			accounting profit
		2023		2022
Tax calculated based on profit before tax		($	109,133)	($	155,090)
and statutory tax rate
Fees excluded according to the tax law			58,890		271,967
Temporary difference of unrecognized			188,829	(	780)
deferred income tax assets
Tax loss of unrecognized deferred			103,993		91,423
income tax assets
Income tax effects of the alternative			10,447		17,003
minimum tax system
Changes in assessment of realizability			7,740		20,748
of deferred income tax assets
Impact tax deductibles of investment		(	50,000)			-
Additional surtax on undistributed			1,924			-
earnings
Underestimation (overestimation) of			68,826	(	17,190)
income tax in previous years
Income Tax Expense		$	281,516	$	228,081

~66~

1. Amounts of deferred tax assets or liabilities as a result of temporary differences are as follows:

follows:
Deferred income tax assets: - Temporary differences: Loss on inventory Unrealized exchange loss Others Tax loss Subtotal Deferred income tax liabilities: - Temporary differences: Unrealized gain on exchange Long-term investments Others Subtotal Total Deferred income tax assets: - Temporary differences: Loss on inventory Unrealized exchange loss Others Subtotal Deferred income tax liabilities: - Temporary differences: Unrealized gain on exchange Long-term investments Others Subtotal Total	2023 January 1 $ 5,287 844 3,234 - $ 9,365 ( 4,200) ( 86,801) ( 30,123) ( 121,124) ($ 111,759) 2022 January 1 $ 3,762 ( 521) 4,819 $ 8,060 ( 409) ( 74,084) ( 36,496) ( 121,124) ($ 113,064)	Recognized in profit or loss $ 3,286 2,814 1,290 5,582 $ 12,972 3,632 ( 13,110) 3,387 ( 6,091) $ 6,881 Recognized in profit o	December 31 $ 8,573 3,658 4,524 5,582 $ 22,337 ( 568) ( 99,911) ( 26,736) ( 127,215) ($ 104,878) r December 31 $ 5,287 844 3,234 $ 9,365 ( 4,200) ( 86,801) ( 30,123) ( 121,124) ($ 111,759)
			r
		loss $ 1,525 1,365 ( 1,585) $ 1,305 ( 3,791) ( 12,717) 6,373 ( 10,135) ($ 8,830)

~67~

1. The effective period of the unused tax losses and unrecognized deferred income tax assets of the Group are as follows:

December 31, 2023

Year of occurrence 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023		Reported amount/ Assessed amount 358,406 672,536 375,964 621,244 582,548 372,163 379,642 813,208 755,605 566,642		Amount not yet	Amount not yet	Amount of unrecognized deferred income tax assets Last year to be deducted 358,406 2024 669,304 2025 371,098 2026 618,216 2027 581,625 2028 372,163 2029 364,284 2030 813,208 2031 755,605 2032 566,642 2033 $ 5,949,356	Last year to be
					deducted 358,406 669,304 371,098 618,216 581,625 372,163 364,284 813,208 755,605 566,642
	$	5,976,763		$	5,949,356	$

December 31, 2022

	Reported			Amount of	Amount of
	amount/			unrecognized
Year of	Assessed	Amount not yet		deferred income		Last year to be
occurrence	amount	deducted		tax	assets	deducted
2013	478,805		478,805		478,805	2023
2014	358,406		358,406		358,406	2024
2015	634,004		634,004		634,004	2025
2016	297,633		297,633		297,633	2026
2017	487,947		487,947		487,947	2027
2018	506,779		506,779		506,779	2028
2019	252,514		252,514		252,514	2029
2020	305,259		305,259		305,259	2030
2021	572,303		572,303		572,303	2031
2022	457,113		457,113		457,113	2032
	$ 4,350,763	$	4,350,763	$ 4,350,763
Deductible temporary difference not recognized as				deferred income tax assets
			December 31, 2023 December 31, 2022
Deductible temporary difference			$ 372,449		$	362,066

1. Deductible temporary difference not recognized as deferred income tax assets

2. The Company’s income tax returns through 2021 have been assessed and approved by the tax authority.

~68~

(XXX) Earnings per share

Earnings per share
0.00% Earnings per share Profit attributable to ordinary shareholders of the parent Diluted Earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee remuneration Profit attributable to ordinary shareholders of the parent company plus assumed conversion of all dilutive potential ordinary shares 0.00% Earnings per share Profit attributable to ordinary shareholders of the parent Diluted Earnings per share Profit attributable to ordinary shareholders of the parent Assumed conversion of all dilutive potential ordinary shares Convertible bonds Employee remuneration Profit attributable to ordinary shareholders of the parent company plus assumed conversion of all dilutive potential ordinary shares		Amount after tax $366,126 $366,126 14,029 - $380,155 Amount after tax $703,519 $703,519 14,422 - $717,941		2023 Weighted average	Earnings per share (in dollars) $ 1.75 $ 1.65 Earnings per share (in dollars) $ 3.37 $ 3.12
				share outstanding
				(thousand shares)
				share outstanding
				(thousand shares)
				208,572 208,572 19,713 1,473 229,758
					$

The weighted average number of shares outstanding in 2023 and 2022 has deducted the number of shares held by the Company and the subordinate company Youe Chung Capital deemed as the Company’s treasury stock (the number of shares is based on the Company’s shareholding).

(XXXI) Business combination

1. The Group acquired 58.33% of shares of Pilot Battery Co., Ltd. on March 1, 2023 for $178,500 through a cash capital increase and gained control over Pilot Battery Co.,Ltd.

2. (1) The fair value of the assets acquired and liabilities assumed from Pilot Battery Co., Ltd. at the date of acquisition and the non-controlling interest as a percentage of

~69~

the acquiree’s identifiable net assets at the date of acquisition were as follows:

Acquisition consideration Cash Share of non-controlling interests in the identifiable net assets of the acquiree Fair value of acquired identifiable assets and assumed liabilities Cash Notes Receivables Accounts Receivables Inventories Prepayments Other Current Assets Property, plant and equipment Deferred Income Tax Assets Right-of-use Asset Other Non-Current Assets Short Term Loans Contract Liabilities Notes Payable Accounts Payable Lease liabilities Other Payables Other Current Liabilities Long-term borrowings Deferred Income Tax Liabilities Total identifiable net assets Goodwill

March 1, 2023 $ 178,500 58,775 237,275 189,429 84 2,297 35,488 2,543 1,951 42,954 5,678 3,148 29,081 ( 99,154) ( 8,649) ( 3,869) ( 17,157) ( 3,148) ( 7,496) ( 568) ( 31,140) ( 412) 141,060 $ 96,215

• (2) Non-controlling interest is measured by the proportion of the acquiree’s net identifiable assets to the non-controlling interest.

• (3) The assessment of the fair value of acquired identifiable assets and assumed liabilities is in progress. At present, it is recorded at the initial valuation, and the relevant acquisition price allocation will be completed within one year.

• (4) Since March 1, 2023, the Group has merged with Pilot Battery Co., Ltd., Pilot Battery Co., Ltd. has contributed operating income and net loss before tax of NT$33,857 and (NT$56,416), respectively. If it is assumed that Pilot Battery Co., Ltd. has been consolidated since January 1, 2023, the Group’s operating revenue and profit before tax in 2023 would have been NT$7,205,002 and NT$443,459, respectively.

• The Group acquired 53.33% of shares of Moment Semiconductor, Inc. on March 17, 2023 for $40,000 through a cash capital increase and gained control over Moment

~70~

Semiconductor, Inc.

• (1) The fair value of the assets acquired and liabilities assumed from Moment Semiconductor, Inc. at the date of acquisition and the non-controlling interest as a percentage of the acquiree’s identifiable net assets at the date of acquisition were as follows:

Acquisition consideration Cash Share of non-controlling interests in the identifiable net assets of the acquiree Fair value of acquired identifiable assets and assumed liabilities Cash Accounts Receivables Inventories Prepayments Property, plant and equipment Other Non-Current Assets Contract Liabilities Notes Payable Accounts Payable Other Payables Other Current Liabilities Total identifiable net assets Goodwill

March 17, 2023 $ 40,000 14,256 54,256 63,085 13,911 33,038 3,098 447 216 ( 837) ( 75,851) ( 1,734) ( 24) ( 4,800) 30,549 $ 23,707

• (2) Non-controlling interest is measured by the proportion of the acquiree’s net identifiable assets to the non-controlling interest.

• (3) The assessment of the fair value of acquired identifiable assets and assumed liabilities is in progress. At present, it is recorded at the initial valuation, and the relevant acquisition price allocation will be completed within one year.

• (4) Since March 17, 2023, the Group has merged with Moment Semiconductor, Inc., Moment Semiconductor, Inc. has contributed operating income and net loss before tax of NT$315,528 and (NT$18,918), respectively. If Moment Semiconductor, Inc. had been included in the Group since January 1, 2023, the Group’s 2023 operating income and net income before tax would have been NT$7,247,932 and NT$440,390, respectively.

• The Group invested $121,372 on May 1, 2023 to acquire 100% equity of One Test Systems and obtain control over One Test Systems.

~71~

• (1) The fair value of the assets acquired and liabilities assumed from One Test Systems at the date of acquisition and the non-controlling interest as a percentage of the acquiree’s identifiable net assets at the date of acquisition were as follows:

Acquisition consideration Cash Share of non-controlling interests in the identifiable net assets of the acquiree Fair value of acquired identifiable assets and assumed liabilities Cash Other Payables Total identifiable net assets Goodwill	May 1, 2023 $ 121,372 -
	121,372
	9,331 ( 9,331) -
	$ 121,372

• (2) Non-controlling interest is measured by the proportion of the acquiree’s net identifiable assets to the non-controlling interest.

• (3) The assessment of the fair value of acquired identifiable assets and assumed liabilities is in progress. At present, it is recorded at the initial valuation, and the relevant acquisition price allocation will be completed within one year.

• (4) Since the Group merged with One Test Systems on May 1, 2023, One Test Systems contributed operating revenue and net loss before tax of NT$0 and (NT$40), respectively. If One Test Systems had been included in the Group since January 1, 2023, the Group’s 2023 operating income and net income before tax would have been NT$7,199,935 and NT$451,663, respectively.

(XXXII) Supplemental cash flow information

Investing activities with partial cash payments:

Purchase of property, plant and equipment Add: Prepayments for equipment at the end of the period Beginning balance of payable on equipment Less: Prepayments for equipment at the beginning of the period Ending balance of payable on equipment Cash paid during the year	2023 $ 4,437,080 422,444 111,919 ( 1,293,001) ( 498,861) $ 3,179,581	2022 $ 2,315,405 1,293,001 85,822 ( 671,105) ( 111,919) $ 2,911,204

~72~

(XXXIII) Changes in liabilities arising from financing activities

January 1, 2023 Change in cash flow from financing activities Interest Incomes Interest Paid Other Non-Cash Transactions December 31, 2023 January 1, 2022 Change in cash flow from financing activities Interest Incomes Interest Paid Other Non-Cash Transactions December 31, 2022	Short Term Loans	Corporate bonds		Long-term borrowings (Mature within	Lease liabilities $ 559,669 ( 51,816) 7,345 ( 7,345) 59,340 $ 567,193 Lease liabilities $ 655,641 ( 55,556) 7,012 ( 7,012) ( 40,416) $ 559,669	Lease liabilities	$	Guarantee Deposits Received 34,754 7,528 - - - 42,282 Guarantee Deposits Received 6,908 27,846 - - - 34,754	(	Total liabilities
										arising from financing activities $11,607,439 1,990,710 50,721 27,885) 185,016 $13,806,001 Total liabilities
				$
				$			$
							$		( (
										arising from financing activities $ 9,418,563 2,274,392 25,115 7,012) 103,619) $11,607,439
				one year) $ 2,722,199 1,057,248 - - - $ 3,779,447
	$ 4,376,766 247,759 - - - $ 4,624,525
							$

VII. Related Party Transactions

(I) Related parties’ names and relationship

Name of the related parties Advagene Biopharma Co., Ltd. Weida Hi-Tech Co., Ltd. Image Match Design Inc. BKS Tec Corp. Pilot Battery Co., Ltd. Ontario Capital Co., Ltd. Taiwan Mask Charity Foundation

Relationship with the Group Affiliates

Affiliates

Other related party (Note 1) Other related party Other related party (Note 2) Other related party Other related party

Note 1: Image Match Design Inc. re-elected it directors on June 1, 2023. Youe Chung Capital Corporation is no longer a director of the company, and the company is not a related party of the Group.

• Note 2: In March 2023, the Group acquired 58.33% of the shares of Pilot Battery Co., Ltd. and gained control over the company, which has been included in the consolidated financial statements as a consolidated entity since the acquisition of control.

~73~

(II) Significant transactions with the related parties

1. Operating revenue

Product sales: Affiliates Other related party Total	2023 $ 1,336 2,425 $ 3,761	2022 $ 7,066 28,629 $ 35,695

There are no major abnormalities in the transaction prices and payment terms of the related party compared to that of non-related parties.

1. Purchase

2. Purchase
Purchase of merchandise: Other related party 3. Account receivable from related parties. Accounts Receivables: Affiliates Other related party Other receivables: Other related party Total 4. Related-party payables Accounts payable: Other related party Other payables: Other related party Total	2023 2022 $ 74 $ 386 December 31, 2023 December 31, 2022 $ - $ 325 26 2,021 407 - $ 433 $ 2,346 December 31, 2023 December 31, 2022 $ - $ 284 304 - $ 304 $ 284
		$ 284 - $ 284

1. Acquisition of financial assets

2. (1) Pilot Battery Co., Ltd. was other related party to the Group. On March 1, 2023, the Group invested $178,500 to acquire 7,000 thousand shares of Pilot Battery Co.,Ltd., a 58.33% shareholding, to gain control and include the company as a consolidated entity in the consolidated financial statements. Please refer to Note 6(31) for details of the business merger transaction.

3. (2) Advagene Biopharma Co., Ltd. is an affiliate of the Group. The Group contributed NT$15,000 on September 27, 2023 to increase the capital of Advagene Biopharma Co., Ltd., Ltd. in cash and acquired 600 thousand shares.

6. Others

• (1) Deposits Received:

~74~

Other related party (2) Rent income: Other related party		December 31, 2023 $ 118 2023 $ 1,677	December 31, 2022
			$ 95 2022 $ 891

• (3) In 2023 and 2022, the Company’s subsidiary, You Zhuan Capital Corporation, donated 900,000 and 350,000 shares of the Company’s stock, totaling $12,807 and $4,980, respectively, to the Taiwan Mask Charitable Foundation.

• (4) In 2023 and 2022, the Company donated NT$2,685 and NT$4,416, respectively, in cash to the Taiwan Mask Charity Foundation.

• Loaning of funds to related parties

Loans from related parties:

(1) Closing balance (recorded as “short- term borrowings”) Other related party (2) Interest expenses Other related party	December 31, 2023 $ 30,000 2023 $ 304	December 31, 2022 $- 2022 $-

The conditions for borrowing from related parties are that the interest is paid monthly at an annual interest rate of 2.7% after the loan is loaned, and the principal is repaid at the maturity. The borrowing period is from August 3, 2023 to June 30, 2024.

(III) Compensation of key management personnel

Compensation of key management personnel
Salary and short-term employee benefits Post-employment benefits Total	2023 $ 54,045 324 $ 54,369	2022 $ 71,160 469
		$ 71,629

~75~

VIII. Pledged Assets

Assets pledged by the Group as collateral are as follows:

Assets Demand deposit (Recognized as “Financial assets at amortized cost”) Time deposit (Recognized as “Financial assets at amortized cost”) Stocks of publicly traded and OTC companies (recognized as “Financial assets at fair value through profit or loss”) Shares of the Company (recognized as “treasury stock”) (Note) Buildings and structures (including land) Machinery and equipment and equipment under acceptance Real estate investment Office equipment Other equipment Intangible assets

Book value December 31, 2023 December 31, 2022 Purpose $ 534,179 $ 124,883 Reserve accounts for long- and short-term borrowings 382,863 490,190 Short-term loans and guarantees for goods out of the free zone 3,145,150 2,682,150 Short Term Loans 491,647 504,454 Short Term Loans 1,181,577 1,169,267 Long-term borrowings 3,433,402 2,638,893 Long- and short-term borrowings 170,500 170,346 Long- and short-term borrowings - 2,401 Long- and short-term borrowings 5,936 4,470 Long- and short-term borrowings - 508 Long-term borrowings $ 9,345,254 $ 7,787,562

$ 534,179 382,863 3,145,150 491,647 1,181,577 3,433,402 170,500 - 5,936 - $ 9,345,254

Note: The cost of pledged treasury stocks was NT$491,647 and its fair value was NT$2,456,505 as of December 31, 2023.

IX. Significant Contingent Liabilities and Unrecognized Contract Commitments

• (I) Contingencies

None.

• (II) Commitments

• Machine equipment maintenance contracts that have been signed but not yet paid

Machine maintenance	December 31, 2023 $ 44,906	December 31, 2022
		$ 51,362

~76~

1. Capital expenditures that have been signed but not yet incurred

December 31, 2023 December 31, 2022 Property, plant and equipment $ 980,980 $ 2,065,912

1. Lease agreement

Please see Note 6 (8) and (9)

X. Losses due to Major Disasters

None.

XI. Major Events after Financial Statement Date

1. The resolution of the Company’s Board on March 6, 2024 passed the appropriation of earnings. Please refer to Note 6 (20) for details.

2. On March 6, 2024, the Company’s Board of Directors resolved to acquire the common shares of TrueLight Corporation through private placement. The expected subscription quantity is 13,500 thousand shares for an investment amount of NT$410,400.

XII. Others

(I) Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including “current and non-current borrowings” as shown in the consolidated balance sheet) less cash and cash equivalents. Total capital is calculated as “equity” as shown in the consolidated balance sheet plus net debt.

The Group’s strategy in 2023 and 2022 was to borrow long-term loans and issue corporate bonds to purchase machinery and equipment and obtain long-term working capital. For the years ended December 31, 2023 and 2022, the debt-to-capital ratios were as follows:

Total borrowings Less: Cash and cash equivalents Net debt Total equity Total capital Debt-to-equity ratio	December 31, 2023 $ 13,196,526 ( 1,364,106) 11,832,420 5,049,316 $ 16,881,736 70.09%	December 31, 2022
		$ 11,013,016 ( 1,749,957) 9,263,059 4,434,207 $ 13,697,266 67.63%

~77~

(II) Financial instruments

1. Types of financial instrument

nancial instruments Types of financial instrument
Financial assets Financial Liabilities at Fair Value Through Profit or Loss Mandatory financial assets at fair value through profit or loss Financial assets measured at amortized cost cash and cash equivalents Financial assets measured at amortized cost Notes Receivables Accounts receivable (Including related parties) Other account receivable (Including related parties) Refundable deposit Financial liabilities Financial Liabilities at Fair Value Through Profit or Loss Financial liabilities mandatorily measured at fair value through profit or loss Financial liabilities measured at amortized cost Short Term Loans Notes Payable Accounts payable (Including related parties) Other accounts payable (Including related parties) Corporate bonds payable Long-term borrowings (including current portion) Guarantee Deposits Received Lease liabilities	December 31, 2023 $ 4,522,714 $ 1,364,106 920,042 6,049 1,478,832 29,410 90,526 $ 3,888,965 $ 9,383 $ 5,429,370 66 463,892 1,205,457 3,424,600 4,342,556 42,282 $ 14,908,223 $ 567,193	December 31, 2022
		$ 4,481,155 $ 1,749,957 668,067 1,361 1,503,358 13,751 52,758 $ 3,989,252 $ 5,697 $ 4,624,525 81 417,459 837,213 2,609,044 3,779,447 34,754 $ 12,302,523 $ 559,669

2. Risk management policies

(1) The Group’s activities expose it to a variety of financial risks, including market risk (exchange rate, interest rate and price), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial

~78~

markets and seeks to minimize potential adverse effects on the Group’s financial position and performance.

• (2) Risk management is carried out by a central finance department (Group finance) under policies approved by the Board of Directors. Group finance identifies, evaluates and hedges financial risks in close collaboration with the Group’s operating units. The Board provides written principles for overall risk management, as well as written policies covering specific areas and matters, such as currency exchange risk, interest rate risk, credit risk, the use of derivatives and non-derivative financial instruments and investment of excess liquidity.

• Significant financial risks and degrees of financial risks

• (1) Market risk

  • A. Foreign exchange risk

The Group’s operations involve certain non-functional currencies (the Company’s and certain subsidiaries’ functional currency is the New Taiwan dollar (NTD), and for other certain subsidiaries, the functional currency is the US Dollars, Japanese Yen and China’s Renminbi (RMB)), so it is subject to the impact of exchange rate fluctuation. The details of assets and liabilities denominated in foreign currencies whose values that would be materially affected by exchange rate fluctuations are as follows:

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD RMB : NTD JPY : NTD Financial liabilities Monetary items USD : NTD JPY : NTD	December 31, 2023 Foreign currency (in thousand) USD 40,189 CNY 65,620 JPY 184,753 USD 15,574 JPY 836,916	Exchange rate 30.705 4.327 0.2172 30.705 0.2172	Book value (NT$ in thousands)
			$ 1,234,287 283,941 40,128 478,208 181,778

~79~

December 31, 2022

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD RMB : NTD JPY : NTD Financial liabilities Monetary items USD : NTD JPY : NTD	Foreign currency (in thousand) USD 67,712 CNY 30,598 JPY 47,877 USD 11,803 JPY 283,739	Exchange rate 30.710 4.408 0.232 30.710 0.232	Book value (NT$ in thousands) $ 2,079,436 134,876 11,127 362,470 65,941

• B. Total exchange (loss) gain, both realized and unrealized, from significant foreign exchange variations on monetary items held by the Group amounted to (NT$1,281) and NT$76,984 for the years ended December 31, 2023 and 2022, respectively.

• C. The analysis of foreign currency risk due to significant exchange rate fluctuation is as follows:

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD RMB : NTD JPY : NTD Financial liabilities Monetary items USD : NTD JPY : NTD	2023 Sensitivity	Analysis Effect on profit or loss $ 12,343 2,839 401 ( 4,782) ( 1,818)	Other comprehensive profit and loss affected
	Fluctuation 1% 1% 1% 1% 1%
			$ - - - - -

~80~

(Foreign currency: functional currency) Financial assets Monetary items USD : NTD RMB : NTD JPY : NTD Financial liabilities Monetary items USD : NTD JPY : NTD	2022 Sensitivity Analysis Fluctuation Effect on profit or loss	2022 Sensitivity Analysis Fluctuation Effect on profit or loss	Other comprehensive profit and loss affected
	Fluctuation
	1% 1% 1% 1% 1%	$ 20,794 1,349 111 ( 3,625) ( 881)	$ - - - - -

Price risk

• A. The equity instruments owned by the Company exposing to the price risk are financial assets at fair value through profit or loss and financial assets at fair value through other comprehensive income.

• B. The Group invests primarily in equity instruments and open-end funds issued by domestic and foreign companies. The price of such equity instrument is subject to the uncertainty of the future value of investment target. If the price of such equity instrument increases or decreases by 1%, while all other factors remain unchanged, the net profit after tax affected by equity instruments at fair value through profit or loss after tax for 2023 and 2022 is an increase or decrease of NT$36,182 and NT$35,850, respectively; as for the other comprehensive income classified as equity instruments at fair value through other comprehensive income, it is NT$0 for both 2023 and 2022.

Cash flow and fair value interest rate risk

• A. The Group’s interest rate risk mainly comes from long-term borrowings issued at floating rates, which exposes the Group to cash flow interest rate risk. For 2023 and 2022, the Group’s borrowings issued at floating rates were mainly denominated in New Taiwan dollars and US dollars.

• B. The Group’s borrowings are measured at amortized cost, and the annual interest rate is re-priced according to the contract, which exposes the Group to the risk of future market interest rate changes.

• C. If the long- and short-term borrowing rates increase or decrease by 0.25%, while all other factors remain constant, the net profit after tax for 2023 and 2022 is a decrease or increase of NT$19,544 and NT$16,808, respectively, mainly due to the interest expense changes caused by the floating interest rate.

• (2) Credit risk

• A. Credit risk refers to the risk of financial loss to the Group arising from default by the clients or counterparties of financial instruments under contract obligations,

~81~

and the defaults are accounts receivable and the contract cash flow from debt instruments measured at amortized cost, measured at fair value through other comprehensive income and at fair value through profit or loss.

• B. The management of credit risk is established with a Group perspective. Only the banks and financial institutions with an independent credit rating of at least “A” can be accepted as transaction partners of the Group. According to the Group’s credit policy, each local entity in the Group is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and delivery terms and conditions are offered. Internal risk control assesses the credit quality of the customers, taking into account their financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the Board of Directors. The utilization of credit limits is regularly monitored.

• C. The Group considers a contract payment overdue in accordance with the agreed payment terms a breach of contract.

• D. The Group uses IFRS 9 to provide the following assumption as a basis for determining whether there is a significant increase in the credit risk of financial instruments after the original recognition:

• (A) If the contract payment is overdue for more than 30 days in accordance with the agreed payment terms, the credit risk of the financial asset is significantly increased since the original recognition.

• (B) For bond investments in Taipei Exchange, if any external rating agency rates it as an investment grade on the balance sheet date, the credit risk of the financial asset is considered low.

• E. The Group uses the following indicators to determine the status of credit impairments of debt instruments:

• (A) The issuer has suffered significant financial difficulties or is likely to enter bankruptcy or other financial restructuring.

• (B) The issuer has suffered significant financial difficulties or is likely to enter bankruptcy or other financial restructuring.

• (C) The issuer delays or does not pay for the interest or principal.

• (D) Unfavorable changes in the national- or regional-level economic situation resulting in the issuer’s default.

• F. The Group categorizes the accounts receivable from customers based on the characteristics of trade credit risks. The simplified approach is adopted for estimating the expected credit loss based on the provision matrix.

• G. The Group may write off the amount of financial assets that cannot be reasonably expected to be recovered after recourse. However, the Group will continue the recourse to protect the rights of the claims.

• H. The Group has incorporated forward-looking considerations to adjust the loss rate built according to historic and current data in order to estimate the loss allowance of accounts receivables. The provision matrix for the years ended December 31, 2023 and 2022 are shown as follows:

~82~

Not past due December 31, 2023 Expected loss rate 0.01% Total book value $1,226,407 Loss allowance - Not past due December 31, 2022 Expected loss rate 0.01~1% Total book value $1,188,466 Loss allowance -	Not past due	Up to 30 days 0.05~33.11% $171,778 - Up to 30 days 0.05~1.95% $224,106 ( 619)	31-90 days	91-180 days	More than 181 days past	Total $1,508,255 ( 29,423) Total $1,523,955 ( 20,597)
			0.05~66.19% $ 78,432 ( 4,540) 31-90 days	0.04~98.36% $ 11,385 ( 5,187) 91-180 days	due 50.9~100% $ 20,253 ( 19,696) More than 181 days past
					due 56.58~100% $ 11,591 ( 10,319)

• I. The Group adopts a simplified method in which the loss allowance for the accounts receivable is shown as follows:

The Group adopts a simplified method in which the accounts receivable is shown as follows:	loss allowance for the
January 1 Recognize impairment loss Others December 31 January 1 Recognize impairment loss December 31	2023 Accounts Receivables
	$ 20,597 9,455 ( 629) $ 29,423 2022 Accounts Receivables
	$ 10,039 10,558 $ 20,597

• (3) Liquidity risk

• A. Cash flow forecasting is performed by the operating entities of the Corporate Group and aggregated by the Group’s treasury department. It monitors rolling forecasts of liquidity requirements to ensure the Group has sufficient cash to meet operational needs.

• B. The remaining cash held by each operating entity will be transferred back to the Group’s finance department. The finance department of the Group invests the remaining funds in interest-bearing demand deposits, time deposits, financial assets at fair value through profit or loss, financial assets at amortized cost (time deposits with a maturity of more than 3 months and less than 12 months), as the instruments chosen have appropriate maturities or sufficient liquidity to provide sufficient headroom as determined by the abovementioned forecasts. For the years ended December 31, 2023 and 2022, the position of money market held by the Corporate Group is at NT$2,284,019 and NT$2,418,024, respectively, and is

~83~

expected to generate immediate cash flow to manage liquidity risk.

• C. The Group’s unutilized borrowings are shown as follows:

Floating rate Short-term credit limits Medium to long-term credit limits Fixed rate Short-term credit limits Medium to long-term credit limits	December 31, 2023 $ 1,469,512 - 105,000 8,420 $ 1,582,932	December 31, 2022
		$ 645,878 60,014 - 11,045 $ 716,937

• D. The following table shows the Group’s non-derivative financial liabilities and derivative financial liabilities settled on a net or total amount, grouped according to the relevant maturity date. Non-derivative financial liabilities are analyzed based on the remaining period from the balance sheet date to the contract maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

Non-derivative financial liabilities:

December 31, 2023 Non-derivative financial liabilities: Short Term Loans Notes Payable Accounts payable (Including related parties) Other accounts payable (Including related parties) Lease liabilities Corporate bonds payable Long-term borrowings (including current portion) Guarantee Deposits Received	Within 1 year 1 to 2 years $5,429,370 $ - 66 - 463,892 - 1,205,457 - 45,788 37,109 34,400 34,400 1,320,782 1,148,345 - 42,282	2 to 5 years $ - - - - 98,036 3,558,260 1,669,689 -	Over 5 years
			$ - - - - 446,083 - 480,331 -

~84~

December 31, 2022 Non-derivative financial liabilities: Short Term Loans Notes Payable Accounts payable (Including related parties) Other accounts payable (Including related parties) Lease liabilities Corporate bonds payable Long-term borrowings (including current portion) Guarantee Deposits Received	Within 1 year 1 to 2 years $4,702,123 $ - 81 - 417,459 - 837,213 - 38,246 78,734 - - 680,126 919,483 - 34,754	2 to 5 years $ - - - - 224,177 2,696,140 352,448 -	Over 5 years
			$ - - - - 221,011 - 217,645 -

(III) Fair value information

1. The different levels that the inputs to valuation techniques are used to measure fair value of financial and non-financial instruments have been defined as follows:

2. Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date. A market is regarded as active where a market in which transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. The fair value of the Group’s investment in stocks of publicly traded or OTC firms and beneficiary certificates is included in Level 1.

3. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

4. Level 3: Unobservable inputs for the asset or liability The fair value of the Group’s investment in stocks of non-publicly traded or non-OTC firms and private equity fund is included in Level 3.

5. Financial instruments not measured at fair value

6. Cash, notes receivable, accounts receivable, other receivable, short-term borrowings, notes payable, accounts payable and other payable as reasonable approximation of fair value.

~85~

1. The related information for financial and non-financial instruments measured at fair value by level on the basis of the nature, characteristics and risks of the assets and liabilities is as follows:

December 31, 2023 Level 1 Assets Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Equity securities $4,341,227 Beneficiary certificates 500 $4,341,727 Liabilities Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Convertible bond call/put options $- December 31, 2022 Level 1 Assets Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Equity securities $4,344,484 Beneficiary certificates 500 $4,344,984 Liabilities Recurring fair value measurements Financial Liabilities at Fair Value Through Profit or Loss Convertible bond call/put options $-	Level 2 $67,292 - $67,292 $- Level 2 $79,300 - $79,300 $-	Level 3 $113,695 - $113,695 $ 9,383 Level 3 $56,871 - $56,871 $ 5,697	Total $4,522,214 500 $4,522,714 $ 9,383 Total $4,480,655 500 $4,481,155 $ 5,697
Financial Liabilities at Fair Value Through Profit or Loss Convertible bond call/put options

1. The methods and assumptions adopted by the Group for assessing the fair value are as follows:

2. (1) The Group adopt market pricing as the input of fair value (i.e. Level 1), and the breakdown of the characteristics of the instrument is as follows:

Shares of listed and OTC

company Open-end funds Market price Closing price Net Value

~86~

• (2) Except for the abovementioned financial instruments with active markets, the fair value of the remaining financial instruments is obtained using valuation techniques. The fair value obtained through valuation techniques can refer to the current fair value of other financial instruments with similar substantive conditions and characteristics, discounted cash flow method, or other valuation techniques, including the use of market information available on the date of the consolidated balance sheet (for example, the Taipei Exchange refers to the yield curve, the Reuters adopts the average quotation of interest rate of commercial promissory notes).

• (3) The output of the valuation model is the estimated value, and the valuation technique may not reflect all the relevant factors of the financial instruments and non-financial instruments held by the Group. Therefore, the estimated value of the valuation model will be appropriately adjusted according to additional parameters, such as model risk or liquidity risk. According to the Group’s fair value valuation model management policies and related control procedures, the management believes that in order to properly express the fair value of financial instruments and non-financial instruments in the consolidated balance sheet, valuation adjustments are appropriate and necessary. The price information and parameters used in the valuation process are carefully assessed and appropriately adjusted according to current market conditions.

• (4) The Group incorporates credit risk valuation adjustments into the consideration of the fair value of financial instruments and non-financial instruments to reflect counterparty credit risk and the credit quality of the Group, respectively.

• There were no transfers between Level 1 and 2 in 2023 and 2022.

• The following table shows the changes in Level 3 in 2023 and 2022:

January 1, 2023 Acquisition cost of the period Recognized in profit or loss of the period Impact from exchange rate December 31, 2023 January 1, 2022 Acquisition cost of the period Disposal this period Recognized in profit or loss of the period Impact from exchange rate December 31, 2022	Financial instruments
	$ 51,174 57,500 ( 3,974) ( 388) $ 104,312 Financial instruments
	$ 57,622 12,500 ( 7,132) ( 12,123) 307 $ 51,174

~87~

1. The quantitative information about the significant unobservable input value of the valuation model and the sensitivity analysis of the significant unobservable input value change used in Level 3 fair value measurements are explained as follows:

December 31, 2023

Derivative equity/liability instruments: Shares of non- listed and non- OTC company Convertible bond call/put options December 31, 2022 Derivative equity/liability instruments: Shares of non- listed and non- OTC company Convertible bond call/put options	Fair value $113,695 ( 9,383) Fair value $ 56,871 ( 5,697)	Valuation technique Net asset value method Convertible bond evaluation model Valuation technique Net asset value method Convertible bond evaluation model	Significant unobservable inputs Net asset value Stock price volatility Significant unobservable inputs Net asset value Stock price volatility	Range (weighted average) - 29.44% Range (weighted average) - 50.65%	Relationship between inputs and fair value The higher the net asset value, the higher the fair value The higher the stock price volatility, the higher the fair value Relationship between inputs and fair value The higher the net asset value, the higher the fair value The higher the stock price volatility, the higher the fair value

1. The Group has carefully assessed the valuation models and parameters used to measure fair value. However, use of different valuation models or parameters may result in different measurement. For financial assets or liabilities classified in Level 3, changes in valuation parameters have the following impacts on the income or other comprehensive income of the period:

income of the period:
Inputs Financial assets Equity instruments Net asset value Debt Stock price volatility Total	Chan	December 31, 2023 Recognized in profit or		Recognized in other comprehensive income Favorable changes Adverse changes $ - $ - - - $- $-
			Adverse changes ($ 1,137) ( 10) ($ 1,147)	comprehensive
				Favorable changes $ - - $-

~88~

Financial assets Equity instruments Debt Total	Inputs Net asset value Stock price volatility	Chan	December 31, 2022 Recognized in profit or	December 31, 2022 Recognized in profit or	Recognized in other comprehensive income Favorable changes Adverse changes $ - $ - - - $- $-
			loss Favorable changes $ 569 20 $ 589	Adverse changes ($ 569) ( 20) ($ 589)	comprehensive
					Favorable changes $ - - $-
		ges ± 1% ± 1%

XIII. Supplementary Disclosure

• (I) Significant transactions information

• Loans to others: Please refer to Table 1.

• Provision of endorsements and guarantees to others: Please refer to Table 2.

• Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures): Please refer to Table III.

• Acquisition or sale of the same security with the accumulated cost exceeding NT$300 million or 20% of the Company’s paid-in capital:None.

• Acquisition of real estate exceeding $300 million or 20% of paid-in capital or more: None.

• Disposal of real estate exceeding $300 million or 20% of paid-in capital or more: None.

• Purchases or sales of goods from or to related parties reaching $100 million or 20% of paid-in capital or more: None.

• Receivables from related parties reaching NT$100 million or 20% of paid-in capital or more: None.

• Engaged in derivative trading: None.

• Significant inter-company transactions during the reporting periods: Please refer to Table 4.

• (II) Information on Reinvested Businesses

Names, locations and other information of investee companies (not including investees in Mainland China): Please refer to Table 5.

(III) Information on investments in Mainland China

1. Basic information: Please refer to Table 6.

2. Significant transactions, either directly or indirectly through a third area, with investee companies in Mainland China: None.

(IV) Information on Major Shareholders

Information on major shareholders: Please refer to Table 7.

~89~

XIV. Segments Information

(I) General information

Management has determined the reportable operating segments based on reports reviewed by the president and used to make strategic decisions.

The Group’s corporate structure, the basis for division of segments, and the basis for measurement of segment information have not changed significantly during the current period.

(II) Measurement of segment information

The Group evaluates the performance of the operating segments and allocates resources based on the adjusted net profit of each segment.

(III) Segments information

Information on the reporting segments provided to the chief operating decision maker is shown as follows:

2023:

Photomask and semiconductor segment Revenue from external clients $ 7,079,202 Segment revenue ($ 332,533) Segment margin $ 632,537 Segment margin include: Depreciation ($ 883,018) Amortization expense ($ 43,433) Financial Costs ($ 272,282) Interest income $ 40,376 Investments income recognized by using equity method ($ 85,789) Segment assets $ 19,844,058	Medical segment $ 120,733 $- ($ 186,737) ($ 50,386) ($ 9,062) ($ 20,956) $ 366 $- $1,080,001	Total $ 7,199,935 ($ 332,533) $ 445,800 ($ 933,404) ($ 52,495) ($ 293,238) $ 40,742 ($ 85,789) $20,924,059

~90~

2022 ：

Photomask and semiconductor segment Revenue from external clients $ 7,684,054 Segment revenue ($ 178,008) Segment margin $ 810,187 Segment margin include: Depreciation ($ 560,487) Amortization expense ($ 44,778) Financial Costs ($ 172,615) Interest income $ 25,222 Investments income recognized by using equity method ($ 61,296) Segment assets $ 17,396,692	Medical segment $ 57,064 $- ($ 136,474) ($ 7,706) ($ 613) ($ 4,931) $ 49 $- $ 496,214	Total $ 7,741,118 ($ 178,008) $ 673,713 ($ 568,193) ($ 45,391) ($ 177,546) $ 25,271 ($ 61,296) $17,892,906

(IV) Reconciliation for segment income

Sales between segments are conducted according to the principle of transactions at fair value. The operating revenue from external customers reported to the operating decision maker is measured in a manner consistent with that in the income statement.

The consolidated income, assets and liabilities of related segments are consistent with the consolidated income, consolidated assets and consolidated liabilities, so there is no reconciliation information.

(V) Information on products and services

The revenue from external customers mainly come from the sales of photomasks and semiconductors and product and labor revenue of medical equipment, as shown in Note 6 (22).

(VI) Geographical information

Information by region for the Group in 2023 and 2022:

Taiwan Asia Others Total	2023 Revenue $ 2,839,639 4,267,501 92,795 $ 7,199,935	Non-Current Assets $11,004,887 2,728 - $11,007,615	2022 Revenue $ 2,929,266 4,753,060 58,792 $ 7,741,118	Non-Current Assets $ 8,396,368 1,810 - $ 8,398,178

(VII)

~91~

(VIII) Major customer information

Information by major customer for the Group in 2023 and 2022:

Company B	2023 Revenue $ 845,000	Department Photomask and semiconductor segment	2022 Revenue $ 936,993	Department Photomask and semiconductor segment

~92~

Taiwan Mask Corporation and Subsidiaries Loans to Others January 1 to December 31, 2023

Table 1

Unit: NTD in thousand (Unless otherwise specified)

No. (Note 1)	Company that lent funds	Borrowing party	General ledger account	Related party?	Maximum Balance for the Period	Endingbalance	Amount ActuallyDrawn	Range of interest rate	Nature of loan	Amount of transacti on with borrower	Reason for short- term financing	Amount of recognized impairment loss		Collateral	Collateral	Limit on loans granted to a single party	Ceiling on total loan granted	Note
														Name	Value
1 2 3 3 3 3 4	ADL Energy Corp Miracle Technology CO., LTD. Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Pilot Battery Co., Ltd.	Aptos Technology INC. Aptos Technology INC. Aptos Technology INC. Xsense Technology Innova Vision INC. Moment Semiconductor, Inc. Xsense Technology Corporation (B.V.I.) Taiwan Branch	Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables－ Related Parties Other Receivables - Related Parties Other Receivables - Related Parties Other Receivables－ Related Parties	Y Y Y Y Y Y Y	$ 10,000 170,000 370,000 570,000 90,000 30,000 50,000	$ - 170,000 270,000 300,000 90,000 30,000 50,000	$ - 170,000 270,000 270,000 90,000 30,000 50,000	2.7% 2.7% 2.7% 2.7% 2.7% 2.7% 2.7%	Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing Short-term financing	- - - - - - -	Business operations Working capital Working capital Working capital Working capital Working capital Working capital	- - - - - - -		Promissory note Promissory note Promissory note Promissory note Promissory note Promissory note Promissory note	170,000 270,000 300,000 90,000 30,000 50,000	$ 27,324 174,394 1,410,867 1,410,867 1,410,867 1,410,867 157,182	$ 34,155 174,394 1,410,867 1,410,867 1,410,867 1,410,867 157,182	Note 3 Note 4 Note 6 Note 6 Note 6 Note 6 Note 7

Note 1: The description of the number columns are as follows:

• (1) Fill in “0” for the issuer.

• (2) The investee company is numbered in sequence starting from the Arabic numeral 1 according to company type.

• Note 2: Amendment to the Procedures for Lending Funds to Others:

• (1) Total amount of loans: The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have business dealings with the Company, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, are not restricted by the abovementioned paragraphs. However, the total amount of loans and the amount of loans to a single party shall not exceed 50% of the Company’s net value.

• Note 3: Subsidiary - ADL Energy Corp Procedures for Lending Funds to Others:

• (1) The total loan amount shall not exceed 50% of the Company’s net value. However, for companies or businesses that have a short-term financing need, the loan amount of each individual borrowers shall not exceed 40% of the Company net value.

• (2) In addition to the provisions in (1), the loan amount of each individual borrower of companies or businesses that have business dealings with the Company shall not exceed the amount of transactions between the two parties. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

• (3) In addition to the provisions in (1), in which companies or businesses have a short-term financing need, and the loan amount of each individual borrowers not exceeding 40% of the Company net value, the financing amount refers to the accumulated balance of the company’s short-term financing.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, or loans to the Company from any overseas companies in which the Company holds, directly or indirectly, 100% of the voting shares are not restricted by paragraph 1, subparagraph 1. However, the total loan amount, limits for each individual borrower, and the period of loan should be specified. However, the total amount of funds to be loaned and the limits for individual borrowers should be set, and the period for which funds should be loaned should be clearly defined. The total amount of loans lent between the overseas companies or to the parent company and the limit for each limit are specified as follows:

  • I. The total amount loans to enterprises shall not exceed 50% of the Company’s net value. However, for companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed 40% of the Company net value.

  • II. For overseas companies that have business dealings with each other, the individual loan amount shall not exceed the amount of transactions between the two parties. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

  • III. If there is a need for short-term financing, the loan amount of each individual borrowers shall not exceed 40% of the company’s net value, and the financing amount refers to the accumulated balance of the short-term financing between overseas companies.

~93~

• (5) The highest balance for the current period is the amount resolved by the board.

Note 4: Subsidiary - Miracle Technology Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have business dealings with the Company, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

• (4) Inter-company loans of funds between overseas companies in which the Company owns, directly or indirectly, 100% of the voting shares, are not restricted by the abovementioned paragraphs. However, the total amount of loans and the amount of loans to a single party shall not exceed 50% of the Company’s net value.

Note 5: Subsidiary - Innova Vision Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) The loan amount of each individual borrower of companies or businesses that have business dealings with the Company shall not exceed the amount of transactions between the two parties in the past year. The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties, and shall not exceed 20% of the Company’s net value.

• (3) For companies or businesses that have a short-term financing need, the loan amount of each individual borrower shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company’s net value.

Note 6: Subsidiary - Youe Chung Capital Corporation Procedures for Lending Funds to Others

• (1) Total amount of loans:The total amount of the Company’s loans shall not exceed 40% of the Company’s net value.

• (2) For companies or businesses that have a short-term financing need, the loan amount of each individual borrowers shall not exceed the amount of transactions between the two parties in the most recent year and not exceed 40% of the Company net value.

Note 7: Subsidiary - Pilot Battery Co.,Ltd. Procedures for Lending Funds to Others:

The Company shall not loan funds to any of its shareholders or any other person except under the following circumstances:

• (1) Where an inter-company or inter-firm business transaction calls for a loan arrangement.

• (2) Where an inter-company or inter-firm short-term financing facility is necessary, provided that such financing amount shall not exceed 40% of the lender’s net worth.

~94~

Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023

	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023	Taiwan Mask Corporation and Subsidiaries Endorsements and Guarantees to Others January 1 to December 31, 2023
Table 2	Unit: NTD in thousand (Unless otherwise specified)
No. (Note 1) Endorser/guarantor Name of Company		Guaranteed Party		Limit of endorsement and guarantee for a single enterprise (Note 3,4,5,6)	Maximum Balance of Endorsement/G uarantee for the Period	Ending Balance of Endorsement/G uarantee	Amount Actually Drawn	Amount of Endorsement/Gu arantee Collateralized by Properties	Ratio of Accumulated Endorsement/Guarante e to Net Equity per Latest Financial Statements	Maximum Endorsement/Guar antee Amount Allowable (Note 3,4,5,6)	Guarantee Provided by Parent Company to Subsidiary	Guarantee Provided by Subsidiary to Parent Company Guarantee Provided by Subsidiaries in Mainland China	Note
		Name of Company	Relationship (Note 2)
0 Taiwan Mask Corporation 1 ADL Energy Corp 2 Miko-China Enterprise (Shanghai) Co., Ltd. 3 Miracle Technology CO., LTD. 3 Miracle Technology CO., LTD. 4 Pilot Battery Co., Ltd.		Miracle Technology CO., LTD. Aptos Technology INC. Miracle Technology CO., LTD. Xsense Technology Aptos Technology INC. ADL Energy Corp	2 3 3 1 1 1	$ 229,550 20,493 392,131 174,394 174,394 157,182	$ 226,975 19,500 226,695 150,000 20,000 50,000	$ 214,935 - 224,165 150,000 20,000 30,000	$ - - 224,165 150,000 20,000 30,000	$ - - 224,165 150,000 20,000 30,000	4.43% 0.00% 57.17% 34.40% 4.59% 7.63%	$ 2,049,257 20,493 392,131 174,394 174,394 157,182	Y N N N N N	N N Y N Y N N N N N N N	Note 3 Note 4 Note 5 Note 6 Note 6 Note 7

• Note 1: The description of the number columns are as follows:

• (1) Fill in “0” for the issuer.

• (2) The investee company is numbered in sequence starting from the Arabic numeral 1 according to company type.

• Note 2: The relationship between the guarantor and the guarantee are one of the seven types indicated below:

• (1) A company with which it does business.

• (2) A company in which the Company directly and indirectly holds more than 50% of the voting shares.

• (3) A company that directly and indirectly holds more than 50% of the voting shares in the Company.

• (4) Companies in which the Company holds, directly or indirectly, 90%, or more of the voting shares may make endorsements/guarantees for each other.

• (5) A company that is mutually insured by a contract between peers or co-founders based on the needs of the contracted work.

• (6) A company that is guaranteed by all contributing shareholders in proportion to their shareholdings due to a joint investment relationship.

• (7) Companies that are engaged in joint and several guarantees for the performance guarantee of pre-sale housing sales contracts in accordance with the regulations of the Consumer Protection Act.

• Note 3: The Company’s endorsement and guarantee practices for others provide that:

• (1) The total amount of the Company’s external endorsement guarantee shall not exceed 30% of the Company’s paid-in capital.

• (2) The amount of business transactions refers to the higher of the amount of goods purchased or sold between the parties.

• (3) Companies with which the Company has a parent-child relationship: The endorsement and guarantee for a single enterprise shall not exceed 10% of the Company’s paid-in capital and the company’s paid-in capital being endorsed and guaranteed.

• (4) The aggregate amount of the endorsement and guarantee of the Company and its subsidiaries as a whole shall not exceed 40% of the net worth of the Company, of which the endorsement and guarantee of a single subsidiary shall not exceed 20% of the net worth of the Company.

• Note 4: Subsidiary - ADL Energy Corp Endorsement and Guarantee Procedures:

• (1) The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

• (2) The amount of the endorsement guarantee for a single enterprise shall not exceed 30% of the net value of the company’s most recent audited or reviewed financial statements.

• (3) The Company and its subsidiaries shall state in the shareholders’ meeting the necessity and reasonableness of any endorsement or guarantee of more than 50% of the net value of the Company’s most recent audited or reviewed financial statements.

• Note 5: Miko-China Enterprise (Shanghai) Co., Ltd. Endorsement and Guarantee Procedures:

• The total amount of endorsement guarantee liability is limited to RMB 30 million, and the amount of endorsement guarantee for a single enterprise shall not exceed RMB 30 million; however, for the parent company that directly or indirectly holds, through a subsidiary, more than 50% of the common stock equity of a company, it may endorse up to its net value.

• Note 6: Subsidiary - Miracle Technology Co., Ltd. Endorsement and Guarantee Procedures:

• The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

• Note 7: Subsidiary - Pilot Battery Co.,Ltd. Endorsement and Guarantee Procedures:

The aggregate amount of cumulative external endorsement guarantees shall not exceed 40% of the net value of the Company’s most recent audited or reviewed financial statements.

~95~

Table 3

Taiwan Mask Corporation and Subsidiaries

Holding of marketable securities at the end of the period (not including subsidiaries, associates and joint ventures) December 31, 2023

Unit: NTD in thousand (Unless otherwise specified)

Company name of the shareholding	Marketable securities	Relationship with the marketable securities issuer	General ledger account				End of period	End of period	End of period	Note
					Number of shares	Book value		Ownership	Fair value
Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Jing Hao Investment Co., Ltd. Jingjing Investment Co., Ltd. Aptos Technology INC. ADL Energy Corp Miko-China Enterprise (Shanghai) Co., Ltd.	Common stocks of United Microelectronics Corporation Common stock of China Steel Structure Co., Ltd. Common stocks of Avision Inc. through private placement. Common Stock of 3S Silicon Tech Inc. Common stocks of United Microelectronics Corporation Common stocks of Microtek International Common stocks of Taiwan Mask Common stock of China Steel Structure Co., Ltd. Common stocks of EVERBRITE Technology Image Match Design Inc. B Current Impact Investment B Current Impact Investment Partnership Intellectual Property Innovation Corporation Partnership Fund Wisdom Capital Limited Partnership G-TECH ELECTRONICS LTD. Memchip Technology Co., Ltd. Common stocks of TOPFUN TECHNOLOGY INC. Franklin Templeton SinoAm Asia Pacific Balanced Fund-Accu. Beneficiary Certificate Common stocks of Shenzhen He Mei Jing Yi Semiconductor Technology Co., Ltd.	None None None None None None Parent company None None None The Company is a director of that company None None None None None None None None	Financial Assets at Fair Value Through Profit or Loss - Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial Asset at Fair Value Through Profit or Loss - Non Current Financial assets measured at fair value through other comprehensive income - Non Current Financial Assets at Fair Value Through Profit or Loss - Current Financial Assets at Fair Value Through Profit or Loss - Non Current		7,554,000 14,334,000 10,000,000 1,000,000 5,680,000 40,966,000 35,831,440 24,999,000 12,798,000 378,000 1,000,000 500,000 - - 1,097,092 187,915 100,000 50,000 400,000	$ 397,340 792,670 55,700 11,592 298,768 929,928 2,547,615 1,382,445 540,076 2,925 10,000 5,000 20,000 55,000 - - - 500 20,770		0.06% 7.17% 4.61% 2.69% 0.05% 19.92% 13.97% 12.50% 19.99% 2.26% 10.00% - - - 8.08% 3.13% 12.27% - 0.31%	$ 397,340 792,670 55,700 11,592 298,768 929,928 2,547,615 1,382,445 540,076 2,925 10,000 5,000 20,000 55,000 - - - 500 20,770

~96~

Table 4

Taiwan Mask Corporation and Subsidiaries Significant inter-company transactions during the reporting periods January 1 to December 31, 2023

Unit: NTD in thousand (Unless otherwise specified)

Status of transaction

				Status of transaction	Status of transaction	Status of transaction	Status of transaction
No. (Note 1) Name of the counterparty	Counterparty	Relationship with the counterparty (Note 2)		General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note 3)
0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 0 Taiwan Mask Corporation 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 1 Miracle Technology CO., LTD. 2 Miko-China Enterprise (Shanghai) Co., Ltd. 3 Sichuan Miracle Power Technology Co., Ltd. 4 Youe Chung Capital Corporation	Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle Technology CO., LTD. Miracle International Enterprise(Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Aptos Technology INC. Aptos Technology INC. Innova Vision INC. Innova Vision INC. Xsense Technology Xsense Technology Corporation (B.V.I.) Taiwan Branch Miracle Technology CO., LTD. Aptos Technology INC. Innova Vision INC. Xsense Technology Corporation (B.V.I.) Taiwan Branch Aptos Technology INC. Aptos Technology INC. Xsense Technology Xsense Technology Corporation (B.V.I.) Taiwan Branch Miracle International Enterprise(Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. Sichuan Miracle Power Technology Co., Ltd. Aptos Technology INC. Miracle Technology CO., LTD. Miko-China Enterprise (Shanghai) Co., Ltd. Aptos Technology INC.	1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 3 3 3 3 3 3 3 3 3 3 3 3		Sales Endorsement and guarantee Accounts Receivables Rental income Sales Accounts Receivables Rental income Other Receivables Rental income Other Receivables Rental income Other Receivables Other Incomes Other Incomes Other Incomes Other Incomes Other receivables (loans of funds) Interest income Endorsement and guarantee Sales Sales Accounts Receivables Accounts Receivables Sales Endorsement and guarantee Endorsement and guarantee Sales Other receivables (loans of funds)	11,716 214,935 1,629 2,626 23,415 4,865 52,812 35,350 16,174 28,883 48,697 26,021 1,912 2,490 2,587 1,391 170,000 4,590 150,000 2,308 70,257 1,082 1,470 7,391 20,000 224,165 7,912 270,000	Net 60 Same with other customers Net 60 Same with other customers Net 60 Net 60 Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Same with other customers Receipt and payment at an agreed time Receipt and payment at an agreed time Same with other customers Net 60 Net 30 Net 30 Net 60 Net 60 Same with other customers Same with other customers Net 30 Receipt and payment at an agreed time	0.16% 1.03% 0.01% 0.04% 0.33% 0.02% 0.73% 0.17% 0.22% 0.14% 0.68% 0.12% 0.03% 0.03% 0.04% 0.02% 0.81% 0.06% 0.72% 0.03% 0.98% 0.01% 0.01% 0.10% 0.10% 1.07% 0.11% 1.29%

~97~

Status of transaction

No. (Note 1) Name of the counterparty	Counterparty	Relationship with the counterparty (Note 2)		General ledger account	Amount	Transaction terms	Percentage of consolidated total operating revenues or total assets (Note 3)
4 Youe Chung Capital Corporation Aptos Technology INC. 3 4 Youe Chung Capital Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 4 Youe Chung Capital Corporation Xsense Technology 3 4 Youe Chung Capital Corporation Innova Vision INC. 3 4 Youe Chung Capital Corporation Innova Vision INC. 3 4 Youe Chung Capital Corporation Moment Semiconductor, Inc. 3 5 Aptos Technology INC. Moment Semiconductor, Inc. 3 5 Aptos Technology INC. Moment Semiconductor, Inc. 3 6 ADL Energy Corp Taiwan Mask Corporation 2 7 Innova Vision INC. iPro Vision Inc. 3 7 Innova Vision INC. iPro Vision Inc. 3 8 Pilot Battery Co., Ltd. Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 8 Pilot Battery Co., Ltd. ADL Energy Corp 3 8 Pilot Battery Co., Ltd. Xsense Technology Corporation (B.V.I.) Taiwan Branch 3 9 Digital-Can Tech. Co., Ltd. Taiwan Mask Corporation 2 9 Digital-Can Tech. Co., Ltd. Taiwan Mask Corporation 2 10 Xsense Technology Corporation (B.V.I.) Taiwan Branch Taiwan Mask Corporation 2 10 Xsense Technology Corporation (B.V.I.) Taiwan Branch Taiwan Mask Corporation 2 11 iPro Vision Inc. Innova Vision INC. 2			Interest income 7,148 Receipt and payment at an agreed time 0.10% Other receivables (loans of funds) 270,000 Receipt and payment at an agreed time 1.29% Interest income 7,283 Receipt and payment at an agreed time 0.10% Other receivables (loans of funds) 90,000 Receipt and payment at an agreed time 0.43% Interest income 2,437 Receipt and payment at an agreed time 0.03% Other receivables (loans of funds) 30,000 Receipt and payment at an agreed time 0.14% Sales 13,420 Net 60 0.19% Accounts Receivables 1,440 Net 60 0.01% Sales 11,255 Net 60 0.16% Sales 31,780 Net 60 0.44% Accounts Receivables 36,655 Receipt and payment at an agreed time 0.18% Other receivables (loans of funds) 50,000 Receipt and payment at an agreed time 0.24% Endorsement and guarantee 30,000 Receipt and payment at an agreed time 0.14% Interest income 1,073 Receipt and payment at an agreed time 0.01% Sales 148,644 Net 60 2.06% Accounts Receivables 3,832 Net 60 0.02% Other Incomes 9,000 Receipt and payment at an agreed time 0.13% Other operating revenue 1,000 Receipt and payment at an agreed time 0.01% Sales 1,555 Receipt and payment at an agreed time 0.02%

Note 1: The numbers filled in for the transaction company in respect of inter-company transactions are as follows:

• (1) Parent company is “0”.

• (2) The subsidiaries are numbered in order starting from “1”.

Note 2: Relationship between transaction company and counterparty is classified into the following three categories; fill in the number of category each case belongs to (If transactions between parent company and subsidiaries or between subsidiaries refer to the same transaction, it is not required to disclose twice. For example, if the parent company has already disclosed its transaction with a subsidiary, then the subsidiary is not required to disclose the transaction; for transactions between two subsidiaries, if one of the subsidiaries has disclosed the transaction, then the other is not required to disclose the transaction):

(1) Parent company to subsidiary.

• (2) Subsidiary to parent company.

(3) Subsidiary to subsidiaries.

Note 3: Only transactions with an amount of more than NT$1 million will be disclosed, and transactions with related parties will not be disclosed separately.

~98~

Taiwan Mask Corporation and Subsidiaries Names, locations and other information of investee companies (not including investees in China) January 1 to December 31, 2023

Table 5

Unit: NTD in thousand (Unless otherwise specified)

Name of Investor	Investee	Location	Main business activities		Initial investment amount	Initial investment amount	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Net profit (loss) of the investee for the current period	Investment profit (loss) recognized for the current period	Note
					Balance at the end ofperiod	End of the previousyear	Number of shares	Owners hip	Book value
Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Taiwan Mask Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation Youe Chung Capital Corporation	SunnyLake Park International Holdings, Inc. Youe Chung Capital Corporation Advagene Biopharma Co., Ltd. Miracle Technology CO., LTD. Weida Hi-Tech Co., Ltd. Innova Vision INC. ONE TEST SYSTEMS Pilot Battery Co., Ltd. Advagene Biopharma Co., Ltd. Xsense Technology Corporation Xsense Technology Corporation (B.V.I.) Taiwan Branch Aptos Technology INC. Innova Vision INC. Digital-Can Tech. Co., Ltd. Pilot Battery Co., Ltd.	British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan United States Taiwan Taiwan British Virgin Islands Taiwan Taiwan Taiwan Taiwan Taiwan	Re-investment Re-investment Medical, R&D, manufacturing Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Display panel control chip and other module’s research, design, development, manufacturing and sales Manufacturing, retail, wholesale and international trade of medical equipment Research, development and design of test equipment and related components Electronic parts and components and energy technical services Medical, R&D, manufacturing Precious metal coating Precious metal coating Design, packaging and testing of NAND flash memory, solid state drives and the related products Manufacturing, retail, wholesale and international trade of medical equipment 3D Printing and Plastic Mold Design Electronic parts and components and energy technical services		$ 103,045 1,260,000 165,691 252,651 293,371 598,721 121,372 180,000 75,021 325,965 - 434,692 151,533 139,072 178,500	$ 103,045 1,260,000 165,691 252,651 293,371 578,321 - - 60,021 325,965 - 434,692 151,533 139,072 -	3,120,000 534,877,568 12,549,652 22,955,033 12,176,880 37,813,134 940,000 3,600,000 3,216,223 1 12,189,191 28,481,161 94,370 7,281,250 7,000,000	100% 100% 23.51% 100% 28.20% 75.32% 100% 20.00% 6.03% 100.00 % 53.00% 47.19% 0.19% 57.39% 38.89%	$ 5,683 987,383 32,974 472,096 26,081 142,651 121,332 78,591 8,451 6,247 (3,294) (221,433) 449 106,507 249,031	($ 64) (810,367) (91,817) 17,169 (210,648) (178,674) 5,823 (58,757) (91,817) (72) 10,768 (274,014) (178,674) (4,253) (58,757)	($ 64) (347,421) (22,792) 17,169 (57,935) (165,774) 6 (2,463) (5,062) (72) 2,175 (129,303) (405) (7,351) (30,513)	Note 2

~99~

Name of Investor	Investee	Location	Main business activities		Initial investment amount	Initial investment amount	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Shares held as of the end ofperiod	Net profit (loss) of the investee for the current period	Investment profit (loss) recognized for the current period	Note
					Balance at the end ofperiod	End of the previousyear	Number of shares	Owners hip	Book value
Youe Chung Capital Corporation Aptos Technology INC. Aptos Technology INC. Aptos Technology INC. ADL Energy Corp Miracle Technology CO., LTD. Jingjing Investment Co., Ltd. Innova Vision INC.	Moment Semiconductor, Inc. New Sunrise Limited ONE TEST SYSTEMS ADL Energy Corp Aptos Global Holding Corp. Jingjing Investment Co., Ltd. Miko Technology Co., Ltd Innova Technology	Taiwan Samoa United States Taiwan Seychelles Taiwan Hong Kong Taiwan	Retail and wholesale of memory products Re-investment Research, development and design of test equipment and related components Electronic parts and components and energy technical services Re-investment Re-investment Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Sales of contact lens		40,000 - - 29,795 10,012 37 64,650	- - - 413,050 29,795 10,012 37 64,650	4,000,000 - - 10,000,000 25,860,907 10,000 3,000,000	53.33% 100% 0% 0% 100% 100% 100% 100%	29,910 - - - - 321,670 6,719 (3,396)	(24,327) - 5,823 20,396 - 43,005 (20) (58)	(10,090) - (46) 20,396 - 43,005 (20) (58)	Note 1 Note 2 Note 3
Innova Vision INC. Innova Vision (B.V.I) Inc. British Virgin Islands Re-investment Innova Vision INC. iPro Vision Inc. Japan Sales of contact lens Innova Vision (B.V.I) Inc. iPro Vision Inc. Japan Sales of contact lens Pilot Battery Co., Ltd. ADL Energy Corp Taiwan Electronic parts and components and energy technical services				60,157 60,157 1,000,000 100% (2,717) (1,245) (1,245) 84,204 84,204 6,400 52.03% (1,756) (3,305) (1,720) 56,420 56,420 5,900 47.97% (1,626) (3,305) (1,585) 413,050 - 11,984,526 100% 68,310 20,396 - Note 3

Note 1: As of December 31, 2023, the funds for shares have not been remitted.

Note 2 : The Company ‘s subsidiary , Aptos Technology INC. invested in One Test Systems in May 2023 with a 100 % shareholding. In August 2023, the Group was reorganized and One Test Systems was directly owned by the Company, with its shareholding remaining at 100%.

Note 3: The Group’s organization was restructured in December 2023 and the Company’s subsidiary, Pilot Battery Co.,Ltd., directly owned ADL Energy Corp. with a shareholding ratio of 100%.

~100~

Taiwan Mask Corporation and Subsidiaries Information on investments in China January 1 to December 31, 2023

Table 6	Table 6	Table 6	Table 6	Table 6	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)	Unit: NTD in thousand (Unless otherwise specified)
Investee in Mainland China	Main business activities	Paid-up capital	Investment method (Note 1)	Accumulated amount of remittance from Taiwan to Mainland China at the beginning of theperiod		Amount remitted from Taiwan to China/Amount remitted back to Taiwan for theperiod		Accumulated amount of remittance from Taiwan to China	Profit (loss) of the investee for the current period Ownership held by the Company (direct or indirect)	Investment income (loss) recognized by the Company for the current period (Note 2)	Ending carrying amount	Accumulat ed amount of investment income remitted back to Taiwan	Note
						Remitted to	Remitted back
Miko-China Enterprise (Shanghai) Co., Ltd. Miracle International Enterprise(Shanghai) Co., Ltd. Sichuan Miracle Power Technology Co., Ltd.	Electronics components manufacturing, electronics materials and precision equipment distribution and power component design Electronics components manufacturing, electronics materials and precision equipment distribution and power component design IC product design, production and sales	$ 3,283 10,215 53,676	1 1 3	$ 3,283 10,215 -		$ - - -	$ - - -	$ 3,283 10,215 -	$ 54,528 100% 11,025 100% (2,723) 100%	$ 54,528 11,025 (2,723)	$ 392,131 102,768 54,994	$ - - -	Note 2 (2) B Note 2 (2) B, Note 4 Note 2 (2) B

Name of Company	Accumulated amount of remittance from Taiwan to China as of the end of the period	Investment amount approved by the Investment Commission of the Ministry of Economic Affairs(MOEA)	Ceiling on investments in Mainland China imposed by the Investment Commission of MOEA
Miracle Technology CO., LTD.	$ 13,498	$ 13,498	$ 261,592

Note 1: Investment methods are classified into the following three categories; fill in the number of categories each case belongs to:

• (1) Directly invest in a company in Mainland China.

• (2) Through investing in an existing company in the third area (please specify the company), which then invested in Mainland China.

(3) Others

Note 2: Investment income recognized by the Company for the current period

• (1) If it is still under preparation with no actual gain or loss, it shall be indicated in the box.

• (2) The basis for recognition of the investment gains or losses is divided into the following three, it shall be indicated in the box.

• A. Financial statements audited and validated by an international accounting firm that has a collaborative relationship with CPA firms in Taiwan.

• B. Financial statements audited and validated by a certified accountant or accounting firm who work with the parent company in Taiwan.

• C. Unaudited financial statements.

Note 3: The relevant figures in this table should be presented in New Taiwan Dollars.

Note 4: It was originally invested through Misun Technology Co., Ltd. Since the aforementioned company has gone through dissolution and liquidation, it has been changed to Miracle Technology Co., Ltd. directly investing in Miracle International Enterprise (Shanghai) Co., Ltd.

~101~

Taiwan Mask Corporation and Subsidiaries Information on Major Shareholders December 31, 2023

Table 7

Table 7
Name of Main Shareholders		Shares
		No. of shares held	Ownership
Youe Chung Capital Corporation		35,831,440	13.97%

~102~