T.S.M.C. - AGM Information 2022 | FinancialReports.eu

Taiwan Styrene Monomer Corporation Annual General Shareholders' Meeting for 2022 Meeting Agenda (Translations)

Time and Date: 9:30 a.m., June 22, 2022

Location: No.311, Chi-Hsien 1st Road, Xinxing Dist., Kaohsiung City, Taiwan

(Howard Plaza Hotel Kaohsiung)

Total outstanding shares : The shareholders present in person and by proxy represented 342,401,447 shares (including votes casted electronically 68,328,315 votes) or 64.86% of the total 527,869,764 shares outstanding.

Attendees: Wen-Yuan Lin, Chairman

Po-Yuan Chen, Vice Chairman

Sheng-Chen Li, Director

Jeff Chen, Director

Chin-Chen Chien, Independent Directors and Convener of the Audit Committee Jui-Mu Huang, Independent Directors (Live webcast)

Jason Yin, CPA of KPMG

Gang-Zu Yang, Attorney of D.C LAWFIRM

T.K Chung, General Manager of Taiwan Styrene Monomer Corporation

Erin Chan, Finance Supervisor of Taiwan Styrene Monomer Corporation

Chairman: Wen-Yuan Lin Recorder: Erin Chan

1. Call Meeting to Order:

The aggregate shareholding of the attending shareholders constituted a quorum. The Chairman called the meeting to order.

2. Chairman’s Remarks: (Omitted)

3. Report Items

I. 2021 Business Report
( Please refer to Attachment 1 )
II. Audit Committee’s Review Report
( Please refer to Attachment 2 )
III. To report 2021 Employees’ Profit Sharing Bonus and Directors’ Compensation (Acknowledged by present shareholders)
IV. To report 2021 Earning Distribution and Cash Dividends
(Acknowledged by present shareholders)
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4. Adopting Items

I. To adopt 2021 Business Report and Financial Statements

(Proposed by the board of directors)

Explanatory Notes ：

(1) The Company’s 2021 financial statements have been prepared, and audited by Wu, Lin, CPA, and Ying, Sheng-Yuan, CPA of KPMG, Taiwan with the Auditor’s Report. Together with the Business Report (please refer to Attachment 1), the documents have been submitted to the Audit Committee and reviewed, with the Audit Committee’s Review Report (please refer to Attachment 2).
(2) The aforementioned reports, please refer to Attachment 3.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (includingvotes casted electronically)	Voting Results (includingvotes casted electronically)	% of the total represented sharepresent
Votes in favor:	337,823,799 votes	98.66%
Votes against:	230,112 votes	0.06%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,347,536 votes	1.28%

II. Appropriation of 2021 retained earnings

(Proposed by the board of directors)

Explanatory Notes ：

(1) The Company’s 2021 beginning undistributed earnings was NT$ (same as below) 897,446,245, plus the net income after tax of the period for NT$104,603,777, the reversal of the factional payment of cash dividends NT$18,261, and other amount included in the earnings of the year from the items other than the net profit after tax of the period for NT$168,744,813, less of other comprehensive income (actuarial gains and losses of definite benefit plans) for NT$3,119,601, the total distributable amount is NT$1,167,693,495.
(2) Please refer to Attachment 4 for the 2021 earning distribution schedule.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (includingvotes casted electronically)	Voting Results (includingvotes casted electronically)	% of the total represented share present
Votes in favor:	338,145,709 votes	98.75%
Votes against:	193,940 votes	0.05%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,061,798 votes	1.20%

5. Discussion Items

I. Amend the Articles of Incorporation

(Proposed by the board of directors)

Explanatory Notes ：

In accordance with the amendment of Article 172-2 of the Company Act, some provisions of the Articles of Incorporation have been amended. Please refer to Attachment 5 for the comparison table of the amended provisions.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (includingvotes casted electronically)	Voting Results (includingvotes casted electronically)	% of the total represented sharepresent
Votes in favor:	338,148,550 votes	98.75%
Votes against:	231,396 votes	0.06%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,021,501 votes	1.19%

II. To Approve the Procedures for the Handling of Derivatives Trading (Proposed by the board of directors)

Explanatory Notes ：

The requirements and regulations of the original “Procedures for the Handling of Derivatives Trading” had been under “Procedure of the Acquisition or Disposal of Assets”. Since derivatives’ nature is unique, the Company has established the “Procedures for the Handling of Derivatives Trading”. Please refer to Attachment 6.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (including votes casted electronically)	Voting Results (including votes casted electronically)	% of the total represented share present
Votes in favor:	338,146,826 votes	98.75%
Votes against:	233,985 votes	0.06%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,020,636 votes	1.19%

III. To Amend the Procedure for the Acquisition or Disposal of Assets

(Proposed by the board of directors)

Explanatory Notes ：

In accordance with Jin-Guan-Zheng-Fa-Zhi No. 1110380465 issued by the Financial Supervisory Commission on January 28, 2022, some provisions of the Company’s “Procedures of Acquisition and Disposal of Assets” have been amended. Please refer to Attachment 7 for the comparison table of the amended provisions.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (including votes casted electronically)	Voting Results (including votes casted electronically)	% of the total represented share present
Votes in favor:	338,144,954 votes	98.75%
Votes against:	231,896 votes	0.06%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,024,597 votes	1.19%

IV. To Amend the Rules and Procedures of Shareholders' Meeting

(Proposed by the board of directors)

Explanatory Notes ：

In accordance with Jin-Guan-Zheng-Fa-Zhi No.1110004250 issued by Taiwan Stock Exchange Corporation, that amended the “Sample Template for XX Co., Ltd. Rules of Procedure for Shareholders’ Meetings,” some provisions of the Company’s “Rules of Procedure for Shareholders’ Meetings” have been amended. Please refer to Attachment 8 for the comparison table of the amended provisions.

Resolution ： This proposal was approved and adopted.

Voting results:

Shares represented at the time of voting: 342,401,447

Voting Results (includingvotes casted electronically)	Voting Results (includingvotes casted electronically)	% of the total represented sharepresent
Votes in favor:	338,151,270 votes	98.75%
Votes against:	227,561 votes	0.06%
Votes Invalid:	0 votes	0.00%
Votes abstained:	4,022,616 votes	1.19%

VI. Extemporary Motions: None

VII. Meeting Adjourned: June 22, 2022 (Wednesday) at 09:49 a.m.

(This 2022 AGM Minutes outlines main points of the meeting. Vedio recording of the meeting shall prevail as actual record of meeting procedure and contents.)

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Chairman: Wen-Yuan Lin Recorder: Erin Chan

Please note this document is prepared in accordance with the Chinese version and is for r eference only. In the ecent of any discrepancy between the English version and the Chinese version, the Chinese version shall prevail.

`【` Attachment 1 `】`

Taiwan Styrene Monomer Corporation 2021 Business Report

1. Results of operations based on the business plan

During the fiscal year, the Company produced 346,178 tonnes of styrene and sold 304,811 tonnes of styrene with a sales value of over NT$11,091,274 thousands. The total sales value reaches NT$11,579,628 thousands after adding that of by-products, with a net income of NT$104,604 thousands for the fiscal year of 2021.

2. Budget Execution

Budget Execution
		Unit : NT$ Thousand
Item	Actual amount of 2021	Budget amount of 2021
Net sales	11,579,268	8,892,291
Gross profit	94,783	281,469
Operating profit	(75,333)	98,908
Income before tax	(4,797)	135,675
Net income	104,604	116,180

3. Profitability Analysis

Profitability Analysis
Analyzed items	Year ended December 31, 2021
Earnings (Loss) per share after tax (in NT$)	0.20
Net profit margin (%)	0.90%
Return on assets (ROA) (%)	1.21%
Return on equity (ROE) (%)	1.45%
Ratio of income before tax to paid-in capital (%)	(0.09%)

4. Research and Development

The Company’s core business is styrene. Other than continuing de-bottlenecking the production lines and increasing the production efficiency, the new product application and added values are also actively improved.

The Company continues to develop materials applicable to electronic products and medical devices, extended the development of their applicable commercial fields, and has provided well-known domestic and international enterprises to conduct tests; the Company has since received positive responses.
The Company aims to vertically integrate specialized chemical material which has obtained patents from numerous countries.
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The Company also cooperate with other companies in the development of commercialized professional coated machines to expand the commercialized application market.

5. Management Principles and Prospects

For the 2022 outlook, International Monetary Fund (IMF) revised down the global economic growth of this year from 4.9% to 4.4% in the report dated January 26, citing the slowing down economic growths in China and the U.S., and the impacts from Omicron COVID-19 virus. In addition, the Russia–Ukraine war which took place since February 24 this year has resulted in severe inflation around the world. Although the war will end someday, the consequences shall be monitored.

For the SM market, in this year, the SM capacity in China expands by about 5.7 million tons (14% of the global capacity). With the significant growth of supply, the SM market in Northeast Asia will be impacted strongly.

Therefore, the Company will keep on reinforcing the core business, and started the SM de-bottlenecking program last year, to improve the productivity and lower the production costs for better competitiveness in the core business.Meanwhile, a streamlining project is conducted, to clear up the investees by exiting these underperformed, for better health.At the same time, the Company also looks for the downstream product manufacturers for strategic alliance, for enhancing the Company’s market competitiveness and better operating performance.

The operating guidelines of the Company still takes the “full sales of all productions” as the production/sales strategy, and “zero occupational safety and environmental incident” as the goal of the production management. The sales target of SM this year is 376,500 tons, a historic high. Therefore, it is expected the Company’s operating results will be better than last year.

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Chairman: General Manager: Accounting Manager:

【 Attachment 2 】

The Audit Committee’s Review Report

The Board of Directors has prepared the Company's 2021 Business Report, Financial Statements (including Consolidated and Parent Company Only Financial Statements), and Proposal for Earnings Distribution, among which the Financial Statements have been audited by KPMG Taiwan, by whom an audit report has been issued accordingly. The aforementioned business report, financial statements, and proposal for earnings distribution have been audited and reviewed by the Audit Committee, and no irregularities were found. According to the Securities and Exchange Act and the Company Act, wehereby submit this report for your approval.

Taiwan Styrene Monomer Corporation

Convener of the Audit Committee:

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Mar 22, 2022

【 Attachment 3 】

Independent Auditors’ Report

To the Board of Directors of Taiwan Styrene Monomer Corporation:

Opinion

We have audited the parent company only financial statements of Taiwan Styrene Monomer Corporation (“the Company”), which comprise the statements of financial position as of December 31, 2021 and 2020, and the statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the parent company only financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors(please refer to Other Matter paragraph), the accompanying parent company only financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and its financial performance and its cash flows for the years then ended 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 Certification of Financial Statements by Certified Public Accountants and the auditing standards generally accepted in the Republic of China. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the Certified Public Accountants Code of Professional Ethics in Republic of China (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. Based on our audits and the reports of other auditors, we believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis of our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the parent company only financial statements of the current period. These matters were addressed in the context of our audit of the parent company only financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

1. Revenue recognition

Regarding accounting policies on revenue recognition, please refer to note 4(n) “Revenue recognition” to the parent company only financial statements.

Description of key audit matter:

The Company’s sales revenue is recognized when the performance obligations is satisfied, which depends on the various trade terms agreed with customers. Therefore, the accuracy of revenue recognition is considered to be one of most significance in the audit.

How the matter was addressed in our audit:

Our principal audit procedures included assessing whether the accounting policies regarding to revenue recognition were inconformity with relevant accounting standards; obtaining understanding and testing the design and implement effectiveness of internal controls over revenue recognition; selecting samples and examining the transaction terms and vouchers; in addition, we also performed analytical procedures on primary customers and products to evaluate if there is any material abnormality.

Impairment assessment of investments accounted for using equity method

Refer to note 4(m) ”Impairment of non-financial assets” and note 6 (g) ”Investments accounted for using equity method” to the parent company only financial statements for details of accounting policies and relevant information about impairment assessment of investments accounted for using equity method”.

Description of key audit matter:

The Company assesses impairment of investments accounted for using equity method in accordance with relevant accounting standards. Such assessment of impairment requires management to make judgments and assumptions, therefore, the assessment of impairment loss on investments accounted for using equity method is considered to be one of most significance in the audit.

How the matter was addressed in our audit:

Our principal audit procedures included obtaining understanding of the Company’ s internal controls over impairment loss assessment; evaluating the appropriateness of assumptions adopted by management when determining the recoverable amount based on an appraisal report issued by a third party; and assessing the qualification and independence of the Certified Business Valuator.

Other Matter

We did not audit the financial statements of some equity-accounted investees of the Company. Those statements, which were prepared using a different financial reporting framework, were audited by other auditors, whose reports have been furnished to us. We have performed audit procedures on the conversion adjustments to the financial statements of those investees, which conform to those financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers. Our opinion, insofar as it relates to the amounts included for those investees prior to the conversion adjustments, is based solely on the reports of other auditors. Investments accounted for using equity method on those investees constituting 15.14% and 13.52% of total assets at December 31, 2021 and 2020, and the related share of profit of subsidiaries, associates and joint ventures accounted for using equity method constituting (888.64)% and 32.61% of total profit before tax for the years then ended.

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

Management is responsible for the preparation and fair presentation of the parent company only financial statements in accordance with Regulations Governing the Preparation of Financial Reports by Securities and for such internal control as management determines is necessary to enable the preparation of parent company only financial statements that are free from material misstatement, whether due to fraud or error.

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

Those charged with governance (including the Audit Committee) are responsible for overseeing the Company’s financial reporting process.

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

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

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

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

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

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

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

The engagement partners on the audit resulting in this independent auditors’ report are Lin Wu and Yuan-Sheng Yin.

KPMG

Taipei, Taiwan (Republic of China) March 22, 2022

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(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Balance Sheets

December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2021 Amount % $ 54,783 1 183,037 2 909,849 10 6,119 - 824,976 9 133,663 2	December 31, 2021	December 31, 2021	December 31, 2021
	Amount	%	Amount
2,112,427 24
781,428 9 2,960,451 34 2,695,789 31 8,703 - 7,932 - 126,467 1 3,421 - 85,401 1	1,378,038 15 1,041,758 11
	173,561 2 174,071 2 5,347 - 4,542 - 64,100 1 59,208 1
	243,008 3 237,821 3
	1,621,046 18 1,279,579 14
	5,278,698 60 5,278,698 62 46,300 1 48,224 1 612,264 7 610,435 7 - - 581,249 7 1,167,693 13 581,961 7
6,669,592 76
	1,779,957 20 1,773,645 21
	56,031 1 168,463 2 (13) - (15,178) -
	7,160,973 82 7,253,852 86
$ 8,782,019 100
	$ 8782019 100 8533431 100

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(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

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

2021	% 100 99	2020	% 100 96
Amount $ 11,579,268 11,484,485		Amount 7,899,885 7,576,668
94,783	1	323,217	4
60,105 107,882 2,127 2	1 1 - -	56,946 85,723 6,371 3	1 1 - -
170,116	2	149,043	2
(75,333)	(1)	174,174	2
1,009 9,177 7,377 (448) 53,421	- - - - -	2,120 39,621 94,618 (168) 56,742	- 1 1 - 1
70,536	-	192,933	3
(4,797) (109,401)	(1) (1)	367,107 79,591	5 1
104,604	-	287,516	4
(3,937) 16,329 (46,205) (787)	- - - -	6,420 68,671 426,307 1,284	- 1 5 -
(33,026)	-	500,114	6
(847) (9,446) -	- - -	(1,813) (12,930) -	- - -
(10,293)	-	(14,743)	-
(43,319)	-	485,371	6
$ 61,285	-	772,887	10
$	0.20		0.55
$	0.20		0.54

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(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Common stock $ 5,278,698 - -	Capital surplus 42,418 - -		Retained earnings	Retained earnings	Total 2,282,185 287,516 5,261	Other equity interest Exchange differences on translation of Unrealized gains (losses) on financial assets measured at fair value through foreign financial statements other comprehensive income Total (10,913) (570,336) (581,249) - - - (14,743) 494,853 480,110	Other equity interest Exchange differences on translation of Unrealized gains (losses) on financial assets measured at fair value through foreign financial statements other comprehensive income Total (10,913) (570,336) (581,249) - - - (14,743) 494,853 480,110	Treasury shares - - -
		Legal reserve 531,249 - -	Special reserve	Unappropriated retained earnings 1,320,268 287,516 5,261
			430,668 - -
- - - - - - - -	- - - - - 3,192 2,614 -	- 79,186 - - - - - -	- - 150,581 - - - - -	292,777 (79,186) (150,581) (526,830) - (513) (276,730) 2,756	292,777 - - (526,830) - (513) (276,730) 2,756	(14,743) 494,853 - - - - - - - - 356 513 (185) 272,934 (1,260) (2,756)	480,110 - - - - 869 272,749 (4,016)	- - - - (15,178) - - -
5,278,698 - -	48,224 - -	610,435 - -	581,249 - -	581,961 104,604 (3,120)	1,773,645 104,604 (3,120)	(26,745) 195,208 - - (10,293) (29,906)	168,463 - (40,199)	(15,178) - -
	- - - - 13 4,433 - 997 (7,367)	- 1,829 - - - - - - -	- - - (581,249) - - - - -	101,484 (1,829) (263,917) 581,249 - - 74,637 - 94,108	101,484 - (263,917) - - - 74,637 - 94,108	(10,293) (29,906) - - - - - - - - - - - (74,637) 546 - 1,858 -	(40,199) - - - - - (74,637) 546 1,858	- - - - (13) 15,178 - - -
$ 5,278,698	46,300	612,264	-	1,167,693	1,779,957	(34,634) 90,665	56,031	(13)

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(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit (loss) before tax Adjustments: Adjustments to reconcile profit (loss) Depreciation expense Amortization expense Expected credit impairment loss Interest expense Interest income Dividend income Share-based payments Share of gain of subsidiaries, associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Gain on disposal of non-current assets held for sale Gain (loss) on disposal of investments Impairment loss on non-financial assets Gain on bargain purchase transaction Gain on lease modification Loss from decline (gain from recovery) in value of inventories Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Changes in operating assets: Financial assets mandatorily measured at fair value through profit or loss Accounts receivable Other receivables Inventories Prepayments Total changes in operating assets Changes in operating liabilities: Contract liabilities Accounts payable Other payables Other current liabilities Net defined benefit liabilities Total changes in operating liabilities Total changes in operating assets and liabilities Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Dividends paid Income taxes paid Net cash flows used in operating activities Cash flows from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Proceeds from disposal of investments accounted for using equity method Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Decrease in refundable deposits Acquisition of intangible assets Increase in other non-current assets Dividends received Net cash flows used in investing activities Cash flows from financing activities: Increase in short-term borrowings Decrease in short-term borrowings Payment of lease liabilities Cash dividends paid Acquisition of treasury shares Proceeds from transfer of treasury shares to employees Net cash flows used in financing activities Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2021 $ (4,797) 222,462 2,553 2 448 (1,009) (6,843) 4,472 (53,421) (270) - 1,858 139 (403) - 130,000	2020 367,107 216,347 2,528 3 168 (2,120) (4,441) - (56,742) - (71,578) (1,445) 84 - (2) (23,758)
	299,988	59,044
	(137,677) (39,305) (1,441) (524,995) (10,789)	(6,260) (54,517) (3,900) 21,342 (2,763)
	(714,207)	(46,098)
	5,001 186,015 (12,828) 190 955	- (305,867) (5,373) 359 1,183
	179,333	(309,698)
	(534,874)	(355,796)
	(239,683) 1,047 6,843 (348) (57) (35,926)	70,355 2,268 4,441 (168) (83) (107,214)
	(268,124)	(30,401)
	- 15,718 (17,273) - (179,328) 270 (39) - (915) (24,798) 24,312	(32,278) 9,803 (38,832) 193,559 (253,158) - - 491 - (3,249) 11,170
	(182,053)	(112,494)
	435,759 (200,000) (4,382) (263,917) - 15,139	- - (4,638) (526,830) (15,178) -
	(17,401)	(546,646)
	(467,578) 522,361	(689,541) 1,211,902
	$ 54,783	522,361

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Independent Auditors ’ Report

To the Board of Directors of Taiwan Styrene Monomer Corporation:

Opinion

We have audited the consolidated financial statements of Taiwan Styrene Monomer Corporation (“the Company”), and its subsidiaries (together referred to as the “Group”), which comprise the consolidated balance sheets as of December 31, 2021 and 2020, and the consolidated statements of comprehensive income, changes in equity and cash flows for the years then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.

In our opinion, based on our audits and the reports of other auditors (please refer to Other Matter paragraph), the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at December 31, 2021 and 2020, and its consolidated financial performance and its consolidated cash flows for the years then ended in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the International Financial Reporting Standards (“IFRSs”), International Accounting Standards ( “IASs”), Interpretations developed by the International Financial Reporting Interpretations Committee (“IFRIC”) or the former Standing Interpretations Committee (“SIC”) endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China.

Basis for Opinion

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

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.

1. Revenue recognition

Regarding accounting policies on revenue recognition, please refer to note 4(p) “Revenue recognition” to the consolidated financial statements.

Description of key audit matter:

The Group’s sales revenue is recognized when a performance obligation is satisfied, which depends on the various trade terms agreed with customers. Therefore, the accuracy of revenue recognition is considered to be one of most significance in the audit.

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How the matter was addressed in our audit

Impairment assessment of investments accounted for using equity method

Refer to note 4(o) “ Impairment of non-financial assets” and note 6 (i) “ Investments accounted for using equity method”to the consolidated financial statements for details of accounting policies and relevant information about impairment assessment of investments accounted for using equity method.

Description of key audit matter:

The Group assesses impairment of investments accounted for using equity method in accordance with relevant accounting standards. Such assessment of impairment requires management to make judgments and assumptions, therefore, the assessment of impairment loss on investments accounted for using equity method is considered to be one of most significance in the audit.

How the matter was addressed in our audit:

Our principal audit procedures included obtaining understanding of the Group’s internal controls over impairment loss assessment; evaluating the appropriateness of assumptions adopted by management when determining the recoverable amount based on an appraisal report issued by a third party; and assessing the qualification and independence of the Certified Business Valuator.

Other Matter

We did not audit the financial statements of some equity-accounted investees of the Group. Those statements, which were prepared using a different financial reporting framework, were audited by other auditors, whose reports have been furnished to us. We have performed audit procedures on the conversion adjustments to the financial statements of those investees, which conform to those financial statements in accordance with the Regulations Governing the Preparation of Financial Reports by Securities Issuers and with the IFRSs, IASs, IFRIC, SIC endorsed and issued into effect by the Financial Supervisory Commission of the Republic of China. Our opinion, insofar as it relates to the amounts included for those investees prior to the conversion adjustments, is based solely on the reports of other auditors. Investments accounted for using equity method on those investees constituting 14.83% and 13.40% of the consolidated total assets at December 31, 2021 and 2020, respectively, and the related share of profit of associates and joint ventures accounted for using equity method constituted (586.97)% and 32.23% of the consolidated total profit before tax for the years ended December 31, 2021 and 2020, respectively.

Taiwan Styrene Monomer Corporation has prepared its parent-company-only financial statements as of and for the years ended December 31, 2021 and 2020, on which we have issued an unqualified opinion with other matters paragraph.

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

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

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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.

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

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

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

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

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From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.4

The engagement partners on the audit resulting in this independent auditors ’ report are Lin Wu and Yuan-Sheng Yin.

KPMG

Taipei, Taiwan (Republic of China) March 22, 2022

Notes to Readers

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

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

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

December 31, 2021 Amount % $ 253,124 3 317,929 3 917,966 10 5,850 - 1,749 - 826,641 9 149,645 2 64,744 1 8 - 159,466 2	December 31, 2021	December 31, 2021	December 31, 2021
	Amount	%	Amount
2,697,122 30
5,756 - 1,016,623 11 1,395,848 15 3,853,008 41 9,965 - 57,015 1 7,932 - 130,868 1 30,576 - 3,587 - 90,890 1
	1,614,174 16 1,231,295 13
	68,686 1 77,036 1 174,659 2 175,127 2 5,729 - 5,028 - 64,100 1 59,208 1 716 - 950 -
	313,890 4 317,349 4
	1,928,064 20 1,548,644 17
	5,278,698 57 5,278,698 59 46,300 - 48,224 1 612,264 7 610,435 7 - - 581,249 6 1,167,693 13 581,961 6
6,602,068 70
	1,779,957 20 1,773,645 19
	56,031 1 168,463 2
	(13) - (15,178) -
	7,160,973 78 7,253,852 81 210153 2 209874 2
$ 9,299,190 100	, , 7371126 80 7463726 83
	,, ,, $ 9,299,190 100 9,012,370 100

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

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

2021	% 100 99	2020	% 100 96
Amount $ 11,714,016 11,581,104		Amount 8,113,225 7,808,122
132,912	1	305,103	4
64,989 151,387 2,311 (97)	1 1 - -	63,676 144,520 6,415 164	1 2 - -
218,590	2	214,775	3
(85,678)	(1)	90,328	1
3,869 29,874 8,140 (2,933) 40,481	- - - - 1	4,788 48,090 98,939 (4,621) 131,733	- 1 1 - 2
79,431	1	278,929	4
(6,247) (111,486)	- (1)	369,257 79,534	5 1
105,239	1	289,723	4
(3,889) (93,480) 63,558 (778)	- (1) 1 -	6,622 359,680 135,215 1,324	- 4 2 -
(33,033)	-	500,193	6
(10,369) (273) -	- - -	(11,303) (2,205) -	- - -
(10,642)	-	(13,508)	-
(43,675)	-	486,685	6
$ 61,564	1	776,408	10
$ 104,604 635	1 -	287,516 2,207	4 -
$ 105,239	1	289,723	4
$ 61,285 279	1 -	772,887 3,521	10 -
$ 61,564	1	776,408	10
$	0.20		0.55
$	0.20		0.54

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Statements of Changes in Equity

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Equity attributable to owners of parent

Ordinary shares $ 5,278,698 - -	Capital surplus 42,418 - -		Retained earnings	Retained earnings	Total 2,282,185 287,516 5,261	Other equity interest Exchange differences on translation of Unrealized gains (losses) on financial assets measured at fair value through foreign financial statements other comprehensive income Total (10,913) (570,336) (581,249) - - - (14,743) 494,853 480,110	Other equity interest Exchange differences on translation of Unrealized gains (losses) on financial assets measured at fair value through foreign financial statements other comprehensive income Total (10,913) (570,336) (581,249) - - - (14,743) 494,853 480,110	Treasury shares - - -	Total equity attributable to owners of parent 7,022,052 287,516 485,371	Non-controllin g interests 207,208 2,207 1,314	Total equity 7,229,260 289,723 486,685
		Legal reserve 531,249 - -	Special reserve	Unappropriated retained earnings 1,320,268 287,516 5,261
			430,668 - -
-	-	-	-	292,777	292,777	(14,743) 494,853	480,110	-	772,887	3,521	776,408
- - - - - - -	- - - - 3,192 2,614 -	79,186 - - - - - -	- 150,581 - - - - -	(79,186) (150,581) (526,830) - (513) (276,730) 2,756	- - (526,830) - (513) (276,730) 2,756	- - - - - - - - 356 513 (185) 272,934 (1,260) (2,756)	- - - - 869 272,749 (4,016)	- - - (15,178) - - -	- - (526,830) (15,178) 3,548 (1,367) (1,260)	- - - - 67 (2,097) 1,175	- - (526,830) (15,178) 3,615 (3,464) (85)
5,278,698 - -	48,224 - -	610,435 - -	581,249 - -	581,961 104,604 (3,120)	1,773,645 104,604 (3,120)	(26,745) 195,208 - - (10,293) (29,906)	168,463 - (40,199)	(15,178) - -	7,253,852 104,604 (43,319)	209,874 635 (356)	7,463,726 105,239 (43,675)
-	-	-	-	101,484	101,484	(10,293) (29,906)	(40,199)	-	61,285	279	61,564
- - - - - - - -	- - - 13 4,433 - 997 (7,367)	1,829 - - - - - - -	- - (581,249) - - - - -	(1,829) (263,917) 581,249 - - 74,637 - 94,108	- (263,917) - - - 74,637 - 94,108	- - - - - - - - - - - (74,637) 546 - 1,858 -	- - - - - (74,637) 546 1,858	- - - (13) 15,178 - - -	- (263,917) - - 19,611 - 1,543 88,599	- - - - - - - -	- (263,917) - - 19,611 - 1,543 88,599
$ 5,278,698	46,300	612,264	-	1,167,693	1,779,957	(34,634) 90,665	56,031	(13)	7,160,973	210,153	7,371,126

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash flows from operating activities: Profit (loss) before tax Adjustments: Adjustments to reconcile profit (loss) Depreciation expense Amortization expense Expected credit impairment loss (gain) Interest expense Interest income Dividend income Share-based payments Share of profit of associates and joint ventures accounted for using equity method Gain on disposal of property, plant and equipment Gain on disposal of non-current assets held for sale Loss (gain) on disposal of investments Impairment loss on non-financial assets Gain on bargain purchase transaction Gain on lease modification Loss from decline (gain from recovery) in value of inventories Total adjustments to reconcile profit (loss) Changes in operating assets and liabilities: Changes in operating assets: Financial assets mandatorily measured at fair value through profit or loss Notes receivable Accounts receivable Other receivables Inventories Prepayments Other current assets Other financial assets Total changes in operating assets Changes in operating liabilities: Current contract liabilities Notes payable Accounts payable Other payables Increase in provisions Other current liabilities Net defined benefit liabilities Total changes in operating liabilities Total changes in operating assets and liabilities	2021 $ (6,247) 248,077 2,553 (97) 2,933 (3,869) (9,706) 4,472 (34,521) (1,335) - 2,404 139 (403) - 130,000	2020 369,257 250,205 2,528 164 4,621 (4,788) (6,526) - (117,836) (4,202) (76,197) (1,089) 101 - (2) (23,758)
	340,647	23,221
	(167,725) - (40,071) (541) (525,351) (35,450) 115 (116,023)	60,760 33 (67,339) (2,262) 26,105 4,556 370 1,722
	(885,046)	23,945
	6,006 2 179,411 (12,165) - 38,091 1,570	4,486 18,472 (296,681) (16,976) 349 (1,104) 60
	212,915	(291,394)
	(672,131)	(267,449)

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(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows (Continued)

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Cash inflow (outflow) generated from operations Interest received Dividends received Interest paid Dividends paid Income taxes paid Net cash flows from (used in) operating activities Cash flows (used in) from investing activities: Acquisition of financial assets at fair value through other comprehensive income Proceeds from capital reduction of financial assets at fair value through other comprehensive income Acquisition of investments accounted for using equity method Proceeds from disposal of subsidiaries Acquisition of property, plant and equipment Proceeds from disposal of property, plant and equipment Increase in refundable deposits Decrease in refundable deposits Acquisition of intangible assets Dividends received Loss control of subsidiaries Net cash used in investing activities Cash flows from (used in) financing activities: Increase in short-term borrowings Decrease in short-term borrowings Proceeds from long-term borrowings Repayments of long-term borrowings Payment of lease liabilities Increase in other non-current liabilities Decrease in other non-current liabilities Cash dividends paid Acquisition of treasury shares Proceeds from transfer of treasury shares to employees Acquisition of ownership interests in subsidiaries Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period	2021 $ (337,731) 3,835 9,706 (2,821) (57) (38,027)	2020 125,029 4,651 6,526 (4,641) (83) (111,097)
	(365,095)	20,385
	- 15,718 (17,273) - (189,199) 1,898 (22) - (915) 24,312 -	(32,278) 9,803 (35,695) 197,647 (284,869) 4,236 - 1,325 - 11,169 (97,328)
	(165,481)	(225,990)
	640,759 (385,000) - (11,743) (6,000) - (234) (263,917) - 15,139 -	80,000 (100,000) 87,700 (28,725) (7,158) 202 - (526,830) (15,178) - (2,097)
	(10,996)	(512,086)
	1,674 (539,898) 793,022	3,886 (713,805) 1,506,827
	$ 253,124	793,022

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【 Attachment 4 】

Taiwan Styrene Monomer Corporation 2021 Earnings Distribution Table

	Unit: NT$
Undistributed earnings at the beginning of period	897,466,245
Add : Net income of the period	104,603,777
Other comprehensive income (actuarial gains and losses of defined benefit plans)	(3,119,601)
Reversal of cash dividend of treasury stock	18,261
The amount of items other than net income that is included in this year's undistributed earnings	168,744,813
Total of earnings available for distribution	1,167,693,495
Legal reserve allocated	(27,022,899)
Reversal allocated as special reserve pursuant to law	(8,810,803)
Subtotal	1,131,859,793
Less: Distributed item
Dividend to shareholders (cash dividend per share of NT$0.15)	(79,180,465)
Undistributed earnings at the end of period	1,052,679,328

==> picture [44 x 45] intentionally omitted <==

Chairman: General Manager: Accounting Manager:

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`【` Attachment 5 `】`

Taiwan Styrene Monomer Corporation Comparison Table between before and after Amendments Made to the Articles of Incorporation

Amended Provisions	Provisions before Amendment	Remarks
Article 8: Share certificates of the Company shall be name-bearing certificates, duly signed by or affixed with seals by the director representing the Company, and duly authenticated by the bank which is competent to certify shares in accordance with the law before issuance. The Company may issue shares or corporate bonds without printing physical certificates in accordance with the Company Act or other related laws and regulations. When issuing new shares or bonds or cancelling outstanding ones, the Company shall register or put under custody the shares or bonds with a centralized securities depository enterprise by way of book-entry transfer, and shall follow the regulations of governing centralized securities depositoryenterprises.	Article 8: Share certificates of the Company shall be name-bearing certificates, duly signed by or affixed with seals by the director representing the Company, and duly authenticated by the bank which is competent to certify shares in accordance with the law before issuance. The Company may issue shares or corporate bonds without printing physical certificates in accordance with the Company Act or other related laws and regulations. When issuing new shares or bonds or cancelling outstanding ones, the Company shall register or put under custody the shares or bonds with a centralized securities depository enterprise by way of book-entry transfer, and shall follow the regulations of governing centralized securities depositoryenterprises.	Revising wording to be more specific.
A shareholders’meeting can be held by means of visual communication network or	Article 14: A notice to convene an annual shareholders' meeting shall be given to each shareholder no later than 30 days prior to the scheduled meeting date. For an extraordinary shareholders' meeting, a meeting notice shall be given to each shareholders no later than 15 days prior to the scheduled meeting date.	Wording and content are amended to accordance with Article 172-2 of the Company Act.
other methods promulgated by the central competent authority. In case a shareholders’meeting is proceeded via visual communication network, the shareholders taking part in such a visual communication meeting shall be deemed to
have attended the meeting in person. A notice to convene an annual shareholders' meeting shall be given to each shareholder no later than 30 days prior to the scheduled meeting date. For an extraordinary shareholders' meeting, a meeting notice shall be given to each shareholders no later than 15 days prior to the scheduled meeting date.
Article 32: The Article of Incorporation was established on September 21, 1979. The 1st amendment was made on May 26, 1980. (The 2nd amendment to The 29th amendment was omitted). The 30th amendment was made on June 25, 2021. The 31th amendment was made on June 22,	Article 32: The Article of Incorporation was established on September 21, 1979. The 1st amendment was made on May 26, 1980. (The 2nd amendment to The 29th amendment was omitted). The 30th amendment was made on June 25, 2021.	Change of Article No. and adding the date of amendment.
2021.

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【 Attachment 6 】

Taiwan Styrene Monomer Corporation

Procedures for the Handling of Derivatives Trading

Article 1 Purpose

These Procedures are adopted to protect investment, enhance public disclosure of information, and strengthen risk management for derivatives transactions by the Company.

Article 2 Transaction principles and policy

Transaction types
(1) The term "derivatives" in these Procedures means products such as forward contracts, options contracts, futures contracts, leverage contracts, and swap contracts whose value is derived from a specified interest rate, financial instrument price, commodity price, foreign exchange rates, indices of prices or rates, or other interests, credit rating or credit index,, or other variables ; or hybrid contracts combining the above contracts; or hybrid contracts or structured products containing embedded derivatives.
(2) The term "forward contracts" does not include insurance contracts, performance contracts, after-sales service contracts, long-term leasing contracts, or long-term purchase (sales) contracts.
Operational or hedging strategy
The purpose of derivatives transactions shall be to ensure the operating profits of the Company's business and avert risks caused by fluctuations in exchange rates, interest rates, or asset prices, and not to profit from speculation. If other transactions are required, the approval of the chairman of the board shall be obtained.
Division of authority and duties:
(1) Trading personnel: Company personnel that may execute derivatives transactions shall first be approved by the chairman of the board, and notice of them shall be given to a Company-designated financial institution. Persons other than the aforesaid personnel may not engage in transactions.
(2) Transaction verification personnel: Personnel within Finance and Accounting Department who are not responsible for trading.
(3) Settlement personnel: Personnel within Finance and Accounting Department who are not responsible for trading and verification.
Levels of Delegation/ Authorization:

(1) Hedging Transaction Level Delegated Amount of Each Transaction Chairman US$3 Million+

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General Up to US$3 Million Manager Authorized Up to US$1 Million Dealer

(2) None-Hedging Transaction: In order to reduce risks, engaging in nonhedging transactions must be approved by the audit committee and submitted to the board of directors for approval before the relevant transactions can be carried out.
Performance assessments: hedging transactions shall be assessed on a regularly scheduled basis once every two weeks; financial transactions shall be assessed on a regularly scheduled basis once per week. Performance assessments shall make a comparison on the assessment date with a predetermined assessment basis, as a reference for future decision-making.
Total contract amount:
(1) Hedging Transaction: the net exposure of consolidated assets and liabilities (including anticipated net exposure in the future) shall be the upper limit of trade.
(2) None-Hedging Transaction : up to USD2 million. Before proceeding to trade, the dealer shall present a report on the trend of foreign exchange rate and the content shall include the analysis of the trend in the foreign exchange market and the recommended means of trade subject to the final approval of the management.
Ceiling amount for losses on all contracts and on individual contracts:
(1) Hedging Transaction : for derivatives transactions in which the Company engages, the ceiling amount for losses on all contracts and on individual contracts is set at 40% of the principal amount of all contracts. When losses on all contracts or any contract reach the aforesaid ceiling, the Company shall immediately notify the Audit Committee and convene the relevant personnel to respond.
(2) None-Hedging Transaction : after the position is established, a stop loss point should be set up to prevent excessive losses. The stop loss point setting should not exceed 10% of the contract amount as the upper limit, and the total accumulated loss throughout the year should not exceed the limit of USD 300,000.

Article 3 Risk Management

Consideration of credit risk: the counterparties should be financial institutions and futures brokers in good standing, in business relation with the Company, and can provide professional information.
Consideration of market risk: Market/Price risk arising from the fluctuations of interest rates and foreign exchange rates or from other factors shall be closely monitored and controlled.
Consideration of liquidity risk: for the liquidity of the derivatives, the
28 -

institutions involved in the transactions must be equipped with adequate facilities, information, and trading capacity and can conduct trade in any market.

Consideration of cash delivery risk: to ensure sufficient liquid capital and facility amount for settlement of trade in delivery.
Consideration of operation risk:
- (1) The limit of authorization, operation procedure must be duly observed.
- (2) The duties of dealing, confirmation, and delivery shall be performed by different persons.
Consideration of legal risk: documents to be signed with a bank must be reviewed by legal affairs personnel before they can be formally signed.
Article 4 Internal audit system

An internal auditor shall regularly review the appropriateness of the derivatives transaction internal control system, conduct monthly checks on how well the trading unit is complying with these Procedures, analyze transaction cycles, and include their findings in an audit report. Where a material violation is discovered, they shall notify the Audit committee in writing.

Article 5 Periodic evaluation methods and handling nonconformities

Periodic evaluation methods
(1) The designated personnel appointed by the board of directors to monitor and control derivatives trading risks on an ongoing basis shall also at regular intervals evaluate whether trading performance accords with established operational strategies, and whether risks assumed are within a tolerable range.
(2) They shall at regular intervals evaluate whether the risk management procedures currently in use are appropriate and scrupulously conducted in accordance with these Procedures.
(3) Derivatives transaction positions shall be evaluated at least once a week. However, hedging transactions for business needs shall be evaluated at least twice a month. The evaluation reports shall be submitted to the senior executive authorized by the board of directors to review and sign.
Handling nonconformities

The senior officer shall monitor the trade and the income status, and take necessary action to respond to any unusual transactions and situations with the chief financial officer and report to the Board at once and an independent director shall be present at the meeting and express an opinion. Article 6 Supervision Principles of Board of Directors

The designated senior officer appointed by the board of director shall
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monitor and control risks of derivatives trading at all times.

Periodically evaluate whether trading performance accords with established operational strategies, and whether risks assumed are within a tolerable range.
The company shall report to the soonest meeting of the board of directors after it authorizes the relevant personnel to handle derivatives trading in accordance with the Company’s Procedures for the Handling of Derivatives Trading.
The Company shall enter detailed information into a log book regarding the types of derivatives transaction in which it engages, dollar amount thereof, the date on which approval was granted by the board of directors, and matters deserving attention in periodic evaluations.
Article 7 Public announcement and reporting procedure
When the loss from engaging in derivatives transactions reaches a ceiling set under these Procedures for all contracts or for individual contracts, within two days from the actual date of such occurrence the relevant data shall be publicly announced and reported on a web site designated by the Securities and Futures Commission.
By the 10th of each month, the Company shall input the status of its derivatives transactions up until the end of the preceding month, as well as that of any Company subsidiary that is not a domestic public company, into the information reporting website specified by the Securities and Futures Commission using the prescribed format.
Article 8 Control of subsidiaries
The Company shall ensure that its subsidiaries adopt handling procedures for the conduct of financial derivatives transactions in accordance with the Regulations Governing the Acquisition and Disposal of Assets by Public Companies issued by the Securities and Futures Commission of the Ministry of Finance.
A subsidiary shall carry out self-inspections to determine whether its adopted procedures are in compliance with the provisions of the applicable regulations, and whether asset acquisition and disposal transactions are carried out in accordance with its adopted handling procedures.
An internal auditor of the Company shall review the self-inspection reports of subsidiaries, and if a material violation is found shall inform the Audit Committee in writing.
If any circumstance contemplated under these Procedures occurs at a subsidiary of the Company, the subsidiary shall first notify the Company, and subsequently take action to handle the circumstance. In addition, a subsidiary is required each month to furnish the Company with relevant
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detailed statements for the previous month to facilitate corporate oversight.

Article 9 Penal provisions

If relevant personnel violate these Procedures or any provision herein, measures shall be taken under the applicable rules of the Company.

Article 10 Amendment

These Procedures are adopted in accordance with the laws and regulations, and have been adopted with the approval of one half or more of the entire membership of the Audit Committee, and submitted it to board of directors, and submitted to a shareholders meeting for approval; the same applies when the Procedures are amended. Where the position of independent director(s) has been created, when these Procedures are submitted for deliberation by the board of directors, each independent director's opinions shall be taken into full consideration; the Audit Committee specific opinions of assent or dissent and the reasons therefore shall be included in the minutes of the board of directors meeting.

Article 11 Approved by the Annual General Meeting 22 June 2022.

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【 Attachment 7 】

Comparison Table of Amended Operational Procedures for Acquisition and Disposal of Assets

Article after amendment	Original article	Explanation
Article 2 Applicable Scope of Assets (Omitted above) (V) Right-of-use assets. (VI) Derivatives (VII) Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law. (VIII) Other important assets	Article 2 Applicable Scope of Assets (Omitted above) (V) Right-of-use assets (VI) Derivatives (VII) Assets acquired or disposed of in connection with mergers, demergers, acquisitions, or transfer of shares in accordance with law (VIII) Other important assets	Revising wording to be more specific.
Article 4 (I) Omitted (II) In acquiring or disposing of negotiable securities, where any of the following circumstance occurs, prior to the date of occurrence of the event, the Company shall obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference. If the dollar amount of the transaction is 20 percent of the Company’s paid-in capital or NT$300 million or more, the Company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise the following circumstances provided by regulations of the Financial Supervisory Commission (FSC)	Article 4 (I) Omitted (II) In acquiring or disposing of negotiable securities, where any of the following circumstance occurs, prior to the date of occurrence of the event, the Company shall obtain financial statements of the issuing company for the most recent period, certified or reviewed by a certified public accountant, for reference. If the dollar amount of the transaction is 20 percent of the Company’s paid-in capital or NT$300 million or more, the Company shall additionally engage a certified public accountant prior to the date of occurrence of the event to provide an opinion regarding the reasonableness of the transaction price. If the CPA needs to use the report of an expert as evidence, the CPA shall do so in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. This requirement does not apply, however, to publicly quoted prices of securities that have an active market, or where otherwise the following circumstances provided by regulations of the Financial Supervisory	Amended to accordance with regulations.

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Article after amendment	Original article	Explanation
(III) Where the Company acquires or disposes of intangible assets or right-of-use assets thereof or memberships and the transaction amount reaches 20 percent or more of paid-in capital or NT$300 million or more, except in transactions with a domestic government agency, the company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price. (Omitted below)	Commission (FSC) (III) Where the Company acquires or disposes of intangible assets or right-of-use assets thereof or memberships and the transaction amount reaches 20 percent or more of paid-in capital or NT$300 million or more, except in transactions with a domestic government agency, the company shall engage a certified public accountant prior to the date of occurrence of the event to render an opinion on the reasonableness of the transaction price. The CPA shall comply with the provisions of Statement of Auditing Standards No. 20 published by the ARDF. (Omitted below)
Article 5. Operational Procedures: (I) Authorized limits and level 1. (Omitted) 2. Deleted	Article 5. Operational Procedures: (I) Authorized limits and level 1. (Omitted) 2. Trading derivatives: (1) Hedging transactions: based on the changes in the Company’s revenue and risk positions, the personnel designated by the chairperson engage tradings under US$3 million (equivalent in other currencies included) for single or aggregated trades; trading over US$3 million may be engaged only with the chairperson’s approval. (2) Non-hedging transactions: to lower risks, the chairperson’s approval is required for single or aggregated traded positions with US$1 million and under; for more than US$1 million, the tradings may be engaged only with the	I. To effectively manage the risk of engaging in derivative trading, the Company has established the “Procedures for the Handling of Derivatives Trading” separately. II. The previous subparagraph 2 is deleted, and thus the number of subparagraphs 3 to 5 is adjusted accordingly.

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Article after amendment		Original article	Explanation
2.Transaction with related parties: (omitted) 3.Merger, demerger, acquisition, or transfer of shares (omitted) 4.Others: (omitted)	3. 4. 5.	(3)
Article 6. Procedures for Public Announcement and Report (I) Under any of the following circumstances, the Company, when acquiring or disposing of assets, shall publicly announce and report the relevant information on the FSC’s designated website in the appropriate format as prescribed by regulations within 2 days counting inclusively from the date of occurrence of the event: 1. (Omitted) 2. (Omitted) 3. The losses from engaging in derivative trading reached the maximum loss amount for the aggregated or single contract defined by the Operational Procedures. 4. (Omitted) 5. (Omitted) 6. (Omitted) (1) Trading domestic	Article 6. Procedures for Public Announcement and Report (I) Under any of the following circumstances, the Company, when acquiring or disposing of assets, shall publicly announce and report the relevant information on the FSC’s designated website in the appropriate format as prescribed by regulations within 2 days counting inclusively from the date of occurrence of the event: 1. (Omitted) 2. (Omitted) 3. The losses from engaging in derivative trading reached the maximum loss amount for the aggregated or single contract defined by Paragraph 4, Article 16, Chapter 3oftheOperational Procedures. 4. (Omitted) 5. (Omitted) 6. (Omitted) (1) Trading of domestic		Proceeded as the newly established “Procedures for the Handling of Derivatives Trading”.

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Article after amendment	Original article	Explanation
government bondsor the foreign government bonds with rating no lower than Taiwan’s sovereign rating. (2) Trading of bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises. (Omitted below)	government bonds (2) Trading of bonds under repurchase and resale agreements, or subscription or redemption of money market funds issued by domestic securities investment trust enterprises. (Omitted below)
Article 7 (Omitted above) (III) Where any one of the following circumstances applies with respect to the professional appraiser’s appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price: (Omitted below)	Article 7 (Omitted above) (III) Where any one of the following circumstances applies with respect to the professional appraiser’s appraisal results, unless all the appraisal results for the assets to be acquired are higher than the transaction amount, or all the appraisal results for the assets to be disposed of are lower than the transaction amount, a certified public accountant shall be engaged to perform the appraisal in accordance with the provisions of Statement of Auditing Standards No. 20 published by the ROC Accounting Research and Development Foundation (ARDF)and render a specific opinion regarding the reason for the discrepancy and the appropriateness of the transaction price: (Omitted below)	Amended to accordance with regulations.
Article 12 (Omitted above) With respect to the types of transactions listed below, when to be conducted between the Company and its parent or subsidiaries, or between its subsidiaries in which it directly or indirectly holds 100 percent of the	Article 12 (Omitted above) With respect to the types of transactions listed below, when they are to be conducted between the Company and its parent or subsidiaries, or between its subsidiaries in which it directly or	To enhance the management of the transactions with related parties, and protect minor shareholders’ rights to express opinions to the Company’s

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Article after amendment	Original article	Explanation
issued shares or authorized capital, the Company’s board of directors may pursuant to Article 5, paragraph 1, subparagraph 5, delegate the board chairman to decide such matters when the transaction is within a certain amount and have the decisions subsequently submitted to and ratified by the next board of directors meeting: (I) Acquisition or disposal of equipment or right-of-use assets thereof held for business use. (II) Acquisition or disposal of real property right-of-use assets held for business use. Where the Company and the subsidiary that is not a public company in Taiwan engage a transaction in Subparagraph 1, and the transaction amount reaches 10 percent or more of the public company’s total asset, the Company may not proceed to enter into a transaction contract or make a payment until the following matters have been approved by the Audit Committee and submitted to the Board for approval:However, it does not apply to the transactions among the Company, its parent or subsidiaries, or between its subsidiaries. The calculation of the transaction amounts referred to in the two preceding paragraphs shall be done in accordance with Subparagraph 6, Paragraph 1 of Article 5, herein; and “within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been submitted to ashareholders’meeting and approved by the board of directors and theAudit Committeeas requiredby the Operational Procedures need not be counted toward the transaction amount. (Omitted below)	indirectly holds 100 percent of the issued shares or authorized capital, the Company’s board of directors may pursuant to Article 5, paragraph 1, subparagraph 5, delegate the board chairman to decide such matters when the transaction is within a certain amount and have the decisions subsequently submitted to and ratified by the next board of directors meeting: (I) Acquisition or disposal of equipment or right-of-use assets thereof held for business use. (II) Acquisition or disposal of real property right-of-use assets held for business use. The calculation of the transaction amounts referred to in the Paragraph 1 and preceding paragraph shall be done in accordance with Subparagraph 5, Paragraph 1 of Article 5, herein; and “within the preceding year” as used herein refers to the year preceding the date of occurrence of the current transaction. Items that have been approved by the board of directors and the Audit Committee need not be counted toward the transaction amount. (Omitted below)	transactions with related parties, the wording was amended.

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Article after amendment	Original article	Explanation
Chapter 3 Controls over Derivatives Article 16. To engage in derivative trading, the “Operational Procedures for Engaging in Derivative Trading” shall be complied with. (Deleted)	Chapter 3 Controls over Derivatives Article 16. Principles and guidelines of trading (I) to (VI)	To effectively manage the risk of engaging in derivative trading, the Company has established the “Procedures for the Handling of Derivatives Trading” separately.
(Deleted)	Article 17 to 19	Provisions are deleted to cope with the newly established “Procedures for the Handling of Derivatives Trading”
Article 17to28	Article20to31	The previous Article 17 to 19 are deleted, and the subsequent article numbers are adjusted.
Article 24 Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide public companies with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter’s opinions shall meet the following requirements: (Omitted below) When issuing an appraisal report or opinion, the personnel referred to in the preceding paragraph shall comply with theself-disciplinary regulations of the industry association he/she belongs toand the following: I. (Omitted) II. Whenexecutinga case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and conclusion shall be	Article 27 Professional appraisers and their officers, certified public accounts, attorneys, and securities underwriters that provide public companies with appraisal reports, certified public accountant’s opinions, attorney’s opinions, or underwriter’s opinions shall meet the following requirements: (Omitted below) When issuing an appraisal report or opinion, the personnel referred to in the preceding paragraph shall comply with the following: I. (Omitted) II. Whenexamininga case, they shall appropriately plan and execute adequate working procedures, in order to produce a conclusion and use the conclusion as the basis for issuing the report or opinion. The related working procedures, data collected, and	Amended to accordance with regulations

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Article after amendment	Original article	Explanation
fully and accurately specified in the case working papers. III. They shall undertake an item-by-item evaluation of the suitability,and reasonableness of the sources of data used, the parameters, and the information, as the basis for issuance of the appraisal report or the opinion. IV. They shall issue a statement attesting to the professional competence and independence of the personnel who prepared the report or opinion, and that they have evaluated and found that the information used is reasonable andsuitable,and that they have complied with applicable laws and regulations.	conclusion shall be fully and accurately specified in the case working papers. III. They shall undertake an item-by-item evaluation of the comprehensiveness, accuracy, and reasonableness of the sources of data used, the parameters, and the information, as the basis for issuance of the appraisal report or the opinion. IV. They shall issue a statement attesting to the professional competence and independence of the personnel who prepared the report or opinion, and that they have evaluated and found that the information used is reasonable andaccurate,and that they have complied with applicable laws and regulations.
Article 25 When acquiring or disposing of material assets, the transactions shall be approved by one-half or more of all audit committee members and submitted to the board of directors for a resolution. The board of directors shall take into full consideration each independent director’s opinions. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the board of directors meeting.	Article 28 When acquiring or disposing of material assets, ortrading derivatives,the transactions shall be approved by one-half or more of all audit committee members and submitted to the board of directors for a resolution. The board of directors shall take into full consideration each independent director’s opinions. If an independent director objects to or expresses reservations about any matter, it shall be recorded in the minutes of the board of directors meeting.	I. Changed article number. II. The acquisition or disposal of derivatives, the “Procedures for the Handling of Derivatives Trading” shall be complied with.
Article28 The Operational Procedures were establishedonJune 22,2007 The 1st amendmentwas made on June 19, 2008. (Omitted below) The 10st amendment was made on June 22, 2022.	Article31 The Operational Procedures were submitted to the shareholders’ meeting for amendmentonJune 22, 2007. The Operational Procedureswere submitted to the shareholders’ meeting for amendmentonJune 19, 2008. (Omitted below)	I. Wording revised; article number adjusted II. Added times of amendment and dates.
	meeting for amendmenton 2008. (Omitted below)

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【 Attachment 8 】

Comparison Table of the Amended “Rules of Procedure for Shareholders’ Meetings “

	Meetings “
Amended Provisions	Provisions before Amendment	Remarks
Article 3 (Convening shareholders’ meetings and shareholders’ meeting notices) Unless otherwise provided by law or regulation, this Corporation’s shareholders’ meetings shall be convened by the board of directors. Any change to the convening method of a shareholders’meeting shall be resolved by the board of directors, and may not be later than sending the meeting notice of the shareholders’ meeting. The Company shall prepare electronic versions of the shareholders’ meeting notice and proxy forms, and the origins of and explanatory materials relating to all proposals, including proposals for ratification, matters for deliberation, or the election or dismissal of directors and upload them to the Market Observation Post System (MOPS) 30 days before the date of a regular shareholders’ meeting or 15 days before the date of a special shareholders’ meeting. The Company shall prepare electronic versions of the shareholders’ meeting agenda and supplemental meeting materials and upload them to the MOPS 21 days before the date of the regular shareholders’ meeting or 15 days before the date of the special shareholders’ meeting,provided, where the Company’s paid-in capital reached NT$10 billion at the end of the latest fiscal year, or the shareholdings of foreign and Chinese shareholders in the shareholder registry of the shareholders’meeting in the latest fiscal year exceed 30%, the electronic versions shall be uploaded 30 days	Article 3 (Convening shareholders’ meetings and shareholders’ meeting notices) Unless otherwise provided by law or regulation, this Corporation’s shareholders’ meetings shall be convened by the board of directors. The Company shall prepare electronic versions of the shareholders’ meeting notice and proxy forms, and the origins of and explanatory materials relating to all proposals, including proposals for ratification, matters for deliberation, or the election or dismissal of directors and upload them to the Market Observation Post System (MOPS) 30 days before the date of a regular shareholders’ meeting or 15 days before the date of a special shareholders’ meeting.The Company shall prepare electronic versions of the shareholders’ meeting agenda and supplemental meeting materials and upload them to the MOPS 21 days before the date of the regular shareholders’ meeting or 15 days before the date of the special shareholders’ meeting. In addition, 15 days before the date of the shareholders’ meeting, the Company shall also have prepared the shareholders’ meeting agenda and supplemental meeting materials and made them available for review by shareholders at any time. The meeting agenda and supplemental materials	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
before the date of the regular shareholders’meeting.In addition, 15 days before the date of the shareholders’ meeting, the Company shall also have prepared the shareholders’ meeting agenda and supplemental meeting materials and made them available for review by shareholders at any time. The meeting agenda and supplemental materials shall also be displayed at the Company and the professional shareholder services agent designated thereby. The agenda handbook and meeting supplemental information in the preceding paragraph, shall be provided to the shareholders for reference on the date of the shareholders’ meeting in the following manners: I. For the physical shareholders’ meeting, such information shall be distributed at the site of the meeting. II. For the video-assisted shareholders’ meeting, such information shall be distributed at the site of the meeting, and transmitted to the video conference platform as the electronic files. III. Where a shareholders’meeting is convened in the manner of video conference, such information shall be transmitted to the video conference platform as the electronic files. (Omitted below)	shall also be displayed at the Company and the professional shareholder services agent designated therebyas well as being distributed on-site at the meeting place. (Omitted below)
Article 4 (Paragraph 1 and 2 omitted) After a proxy form has been delivered to this Corporation, if the shareholder intends to attend the meeting in person or to exercise voting rights by correspondence or electronically, a written notice of proxy cancellation shall be submitted to this Corporation two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail. After a proxy form has been delivered	Article 4 (Paragraph 1 and 2 omitted) After a proxy form has been delivered to this Corporation, if the shareholder intends to attend the meeting in person or to exercise voting rights by correspondence or electronically, a written notice of proxy cancellation shall be submitted to this Corporation two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
to the Company, if the shareholder intends to attend the meeting via video conference, a written notice of proxy cancellation shall be submitted to the Company two business days before the meeting date. If the cancellation notice is submitted after that time, votes cast at the meeting by the proxy shall prevail.
Article 5 (Principles determining the time and place of a shareholders’ meeting) The venue for a shareholders’ meeting shall be the premises of this Corporation, or a place easily accessible to shareholders and suitable for a shareholders’ meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m. Full consideration shall be given to the opinions of the independent directors with respect to the place and time of the meeting. When the Company convenes the video shareholders’meetings, the restrictions of convention location in the preceding paragraph does not apply.	Article 5 (Principles determining the time and place of a shareholders’ meeting) The venue for a shareholders’ meeting shall be the premises of this Corporation, or a place easily accessible to shareholders and suitable for a shareholders’ meeting. The meeting may begin no earlier than 9 a.m. and no later than 3 p.m. Full consideration shall be given to the opinions of the independent directors with respect to the place and time of the meeting.	Amended to accordance with regulations
Article 6 (Preparation of documents such as the attendance book) The Company shall specify the shareholders,proxy solicitors, proxy agents (“shareholders”hereafter),time and location for shareholder registration in the meeting notice as well as other matters requiring attention. The time during which shareholder attendance registrations will be accepted, as stated in the preceding paragraph, shall be at least 30 minutes prior to the time the meeting commences. The place at which attendance registrations are accepted shall be clearly marked and a sufficient number of suitable personnelassigned to handle the registrations. The time during which shareholder attendance	Article 6 (Preparation of documents such as the attendance book) The Company shall specify in its shareholders’ meeting notices the time during which shareholder attendance registrations will be accepted, the place to register for attendance, and other matters for attention. The time during which shareholder attendance registrations will be accepted, as stated in the preceding paragraph, shall be at least 30 minutes prior to the time the meeting commences. The place at which attendance registrations are accepted shall be clearly marked and a sufficient number of suitable personnel assigned to handle the registrations.	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
registrations will be accepted at the video conference platform shall be at least 30 minutes prior to the time the meeting commences. The shareholders accepted are deemed attend the shareholders’meeting in person. Shareholders shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance. the Company may not arbitrarily add requirements for other documents beyond those showing eligibility to attend presented by shareholders. Solicitors soliciting proxy forms shall also bring identification documents for verification. (Paragraph 4 and 5 omitted) When the government or a juristic person is a shareholder, it may be represented by more than one representative at a shareholders’ meeting. When a juristic person is appointed to attend as proxy, it may designate only one person to represent it in the meeting. Where the Company convenes the video shareholders’meetings, and shareholders intend to attend in the manner of video conference, shall register with the Company two days prior to the meeting date. Where the Company convenes the video shareholders’meetings, the Company shall upload the agenda handbook, annual reports and other related information to the video conference platform for the shareholders’meeting the video conference platform for the shareholders’meeting, at least 30 minutes prior to the meeting, and retain the disclosure of such until the meeting ends.	Shareholders and their proxies (collectively,“shareholders”)shall attend shareholders’ meetings based on attendance cards, sign-in cards, or other certificates of attendance. This Corporation may not arbitrarily add requirements for other documents beyond those showing eligibility to attend presented by shareholders. Solicitors soliciting proxy forms shall also bring identification documents for verification. (Paragraph 4 and 5 omitted) When the government or a juristic person is a shareholder, it may be represented by more than one representative at a shareholders’ meeting. When a juristic person is appointed to attend as proxy, it may designate only one person to represent it in the meeting.

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Amended Provisions	Provisions before Amendment	Remarks
Article 6-1 (Where the video shareholders’meetings are convened, matters to be specified on the meeting notice) Where the Company convenes the video shareholders’meetings, the meeting notice shall specify the following matters: I. The method for shareholders to attend the video conference and exercise of their rights. II. The handling method when the video conference platform or participation in the manner of video conference fails due to force majeure, such as natural disasters or incidents, and the follows shall be at least included: (I) Time and date for the postponement or re-convention when the aforesaid continual failure that cannot be eliminated and thus a postponement or re-convention is required. (II) The shareholders who have not registered to attend the first shareholders’meeting must not attend the postponed or re-convened meeting. (III) Where the Company convenes the video-assisted shareholders’meetings, and when the video meeting is discontinued, if the total attending shares still meet the statutory quorum for shareholders’meeting commencement after deducting these shares held by the shares attending the meeting via video conference, the meeting shall continue; the shares held by the shares attending the meeting via video conference shall be included in the total shares of the attending shareholders, but deemed	Added this article	Added this article to accordance with the regulations

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	Amended Provisions	Provisions before Amendment	Remarks
abstaining for all proposals in the concerned shareholders’ meeting. (IV) The handling method where the results of all proposal are announced but the extempore motions are not proceeded. III. Where the Company convenes the video shareholders’meetings, the proper alternatives provided for the shareholders having difficulties attending in the manner of a video conference shall be specified.	(IV)
Article 8 (Documentation of a shareholders’ meeting by audio or video) (Paragraph 1 omitted) The recorded materials of the preceding paragraph shall be retained for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the recording shall be retained until the conclusion of the litigation. Where the Company convenes the video shareholders’meetings, the Company shall record and retain the records of the registration, enrollment, acceptance, inquiries, voting, and the results of vote calculation, and continuously record the video conference thoroughly, both audio and video. The records and audio and video recordings in the preceding paragraphs shall be properly retained during the Company’s survival period, and the audio and video recordings are provided to the organizer of the video conference for custody.		Article 8 (Documentation of a shareholders’ meeting by audio or video) (Paragraph 1 omitted) The recorded materials of the preceding paragraph shall be retained for at least one year. If, however, a shareholder files a lawsuit pursuant to Article 189 of the Company Act, the recording shall be retained until the conclusion of the litigation.	Amended to accordance with regulations
Article 9 Attendance at shareholders’ meetings shall be calculated based on numbers of shares. The number of shares in		Article 9 Attendance at shareholders’ meetings shall be calculated based on numbers of shares. The number of shares in	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards handed in andshares registered at the video conference platform,plus the number of shares whose voting rights are exercised by correspondence or electronically. The chair shall call the meeting to order at the appointed meeting timeand disclose information concerning the number of nonvoting shares and number of shares represented by shareholders attending the meeting.However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the chair shall declare the meeting adjourned.Where the Company convenes the video shareholders’meetings, the Company shall announce the meeting adjournment at the video conference platform. If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders’ meeting shall be convened within one month. Where the Company convenes the video shareholders’meetings, and shareholders intend to attend in the manner of video conference shall	attendance shall be calculated according to the shares indicated by the attendance book and sign-in cards handed in plus the number of shares whose voting rights are exercised by correspondence or electronically. The chair shall call the meeting to order at the appointed meeting time. However, when the attending shareholders do not represent a majority of the total number of issued shares, the chair may announce a postponement, provided that no more than two such postponements, for a combined total of no more than one hour, may be made. If the quorum is not met after two postponements and the attending shareholders still represent less than one third of the total number of issued shares, the chair shall declare the meeting adjourned. If the quorum is not met after two postponements as referred to in the preceding paragraph, but the attending shareholders represent one third or more of the total number of issued shares, a tentative resolution may be adopted pursuant to Article 175, paragraph 1 of the Company Act; all shareholders shall be notified of the tentative resolution and another shareholders’ meeting shall be convened within one month.

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Amended Provisions	Provisions before Amendment	Remarks
register again with the Company per Article 6. (Omitted below)	(Omitted below)
Article 11 (Shareholder speech) (Paragraph 1 to 6 omitted) Where the Company convenes the video shareholders’meetings, the shareholders attending in the manner of video conference may inquire with text at the video conference platform of the meeting since the chair announced the meeting commencement till the adjournment. No more than two inquiries shall be raised for each proposal, and the maximum length is 200 words. Paragraphs 1 to 5 are not applicable. Where the inquiries in the preceding paragraph not violating the requirements, or within the scope of agenda, it is advisable to disclose the inquiries at the video conference platform of the meeting for the public knowledge.	Article 11 (Shareholder speech) (Paragraph 1 to 6 omitted)	Amended to accordance with regulations
Article 13 (Paragraph 1 to 3 omitted) After a shareholder exercises voting rights by correspondence or electronically, if the shareholder intends toattend the meeting via video conferencein person, a written notice of proxy cancellation in the same manner of exercising the voting right shall be submitted to the Company two business days prior to the meeting date. If the cancellation notice is submitted after that time, the voting rights exercised by correspondence or electronically prevail. Where a shareholder exercises voting rights by correspondence or electronic means, and appoints a proxy to attend the meeting by providing the proxy, votes cast at the meeting by the proxy shall prevail. (Paragraph 5 to 7 omitted)	Article 13 (Paragraph 1 to 3 omitted) After a shareholder exercises voting rights by correspondence or electronically, if the shareholder intends to attend the meeting in person, a written notice of proxy cancellation in the same manner of exercising the voting right shall be submitted to the Company two business days prior to the meeting date. If the cancellation notice is submitted after that time, the voting rights exercised by correspondence or electronically prevail. Where a shareholder exercises voting rights by correspondence or electronic means, and appoints a proxy to attend the meeting by providing the proxy, votes cast at the meeting by the proxy shall prevail. (Paragraph 5 to 7 omitted)	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
Vote counting for shareholders’ meeting proposals or elections shall be conducted in public at the place of the shareholders’ meeting. Immediately after vote counting has been completed, the results of the voting, including the statistical tallies of the numbers of votes, shall be announced on-site at the meeting, and a record made of the vote. Where the Company convenes the video shareholders’meetings, the shareholders attending in the manner of video conference shall vote via the video conference platform to each proposal and election after the Chairman declares the meeting commencement. Such voting shall be completed before the Chairman declares the end of voting; anyone misses the deadline is deemed abstention. Where the Company convenes the video shareholders’meetings, the votes shall be calculated at once upon the end of voting declared by the chair, and announce the results of voting or elections. Where the Company convenes the video-assisted shareholders’meetings, the shareholders who already have registered to attend the meeting in the manner of video conference pursuant to Article 6, but then intend to attend the off-line shareholders’meeting in person, shall withdraw the registration in the same manner of registration two days prior to the shareholders’meeting date; these who miss the deadline may only attend the shareholders’meeting in the manner of a video conference. These who exercise the vote in the manner of writing or electronic method, without withdrawing their expressions of intents, and attending the meeting in the manner of video	Vote counting for shareholders’ meeting proposals or elections shall be conducted in public at the place of the shareholders’ meeting. Immediately after vote counting has been completed, the results of the voting, including the statistical tallies of the numbers of votes, shall be announced on-site at the meeting, and a record made of the vote.

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Amended Provisions	Provisions before Amendment	Remarks
conference, other than the extempore motions, must not exercise the votes to the original proposal, propose any amendment to the original proposal, or exercise the votes to the amendment to the original proposal.
Article 15 (Paragraph 1 to 2 omitted) The meeting minutes shall accurately record the year, month, day, and place of the meeting, the chair’s full name, the methods by which resolutions were adopted, and a summary of the deliberations and their voting results (including the number of voting rights), and disclose the number ofvoting rights obtainedby eachelectedin the event of an election of directors. The minutes shall be retained for the duration of the existence of the Company. Where the Company convenes the video shareholders’meetings, other than the matters to be recorded as required in the preceding paragraph, the starting and ending time of the shareholders’meeting, convention method of the meeting, names of the chair and record-keeper, and the handling method when the video conference platform or participation in the manner of video conference fails due to disasters, incidents or other force majeure, and the handling status shall be specified. Where the Company convenes the video shareholders’meetings, other than complying with the preceding paragraph, the minutes shall also specify the alternatives for the shareholders having difficulties attending in the manner of video conference.	Article 15 (Paragraph 1 to 2 omitted) The meeting minutes shall accurately record the year, month, day, and place of the meeting, the chair’s full name, the methods by which resolutions were adopted, and a summary of the deliberations and their voting results (including the number of voting rights), and disclose the number ofvoting rights wonby eachcandidatein the event of an election of directors. The minutes shall be retained for the duration of the existence of the Company.	Amended to accordance with regulations
Article 16 (Public disclosure) On the day of a shareholders’ meeting, the Company shall compile in the	Article 16 (Public disclosure) On the day of a shareholders’ meeting, the Company shall compile in the	Amended to accordance with regulations

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Amended Provisions	Provisions before Amendment	Remarks
prescribed format a statistical statement of the number of shares obtained by solicitors through solicitation and the number of shares represented by proxies,and shares attended by correspondence or electronic means, shall make an express disclosure of the same at the place of the shareholders’ meeting. The Company shall upload the aforesaid information to the video conference platform for the shareholders’meeting, at least 30 minutes prior to the meeting, and retain the disclosure of such until the meeting ends. Where the Company convenes the video shareholders’meetings, the total shares held by the shareholders attending the meeting shall be disclosed at the video conference platform.If the total shares and voting rights of the attending shareholders are counted during the meeting, the same applies. (Omitted below)	prescribed format a statistical statement of the number of shares obtained by solicitors through solicitation and the number of shares represented by proxies, and shall make an express disclosure of the same at the place of the shareholders’ meeting. (Omitted below)
Article 19 (Information disclosure for video conference) Where the shareholders’meetings are convened in the manner of video conference, the Company shall disclose the voting result of each proposal and election results at the video conference platform for the shareholders’meeting, and retain the disclosure at least 15 minutes after the chair declares adjournment.	Added this article	Added this article to accordance with the regulations
Article 20 (Locations of the chair and record-keeper of video shareholders’ meeting) When the Company convenes the video shareholders’meetings, the chair and the record-keeper shall be at the same location within Taiwan. The chair shall announce the address of this location.	Added this article	Added this article to accordance with the regulations

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Amended Provisions	Provisions before Amendment	Remarks
Article 21 (Handling communication barriers and shareholders with digital gaps) Where the shareholders’meeting is convened in the manner of video conference, the Company may provide the shareholders with a simple connection test, and the related services before and during the meeting in real time, to help to handle technical problems of communications. Where the shareholders’meeting is convened in the manner of video conference, the chair, when declaring the meeting commencement, shall also declare the events not requiring postponement or re-convention specified in Paragraph 4, Article 44-20 of the Regulations Governing the Administration of Shareholder Services of Public Companies; before the chair declares the adjournment, in the event where the video conference platform or the participation in the video conference fails for 30 minutes or more due to nature disasters, incidents, or other force majeure, the date of the shareholders’meeting postponed to, or re-convened shall be within five days, and Article 182 of the Company Act shall not apply. Where the meeting is to be postponed or re-convened as specified in the preceding paragraph, the shareholders have not registered to attend the first shareholders’meeting must not attend the postponed or re-convened meeting. For the meeting is to be postponed or re-convened as specified in Paragraph 2, the shareholders who registered to attend the original meeting via the video conference, and have completed the acceptance, but do not attend the postponed or re-convened meeting, their attending shares at the original meeting, the exercised voting right and election right, shall be counted into the	Added this article	Added this article to accordance with the regulations

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Amended Provisions	Provisions before Amendment	Remarks
total shares, voting rights, and election rights of the attending shareholders in the postponed or re-convened meeting. The postponement or re-convention of shareholders’meetings conducted per Paragraph 2 needs not again discuss and resolve the proposal that have completed voting and vote calculation, with the announcement of voting results, or the list of elected directors. Where the Company convenes the video-assisted shareholders’meetings, and when the video meeting is discontinued as specified in Paragraph 2 and the total attending shares still meet the statutory quorum for shareholders’meeting commencement, the postponement or re-convention of the meeting per Paragraph 2 is not required. Under the circumstances to continue the meeting as specified in the preceding paragraph, the shares held by the shares attending the meeting via video conference shall be included in the total shares of the attending shareholders, but deemed abstaining for all proposals in the concerned shareholders’meeting. Where the Company postpones or re-convenes any shareholders’meeting as specified in Paragraph 2, the pre-requisite operations shall be conducted based on the original shareholders’meeting date, and pursuant to Paragraph 7, Article 44-20 of the Regulations Governing the Administration of Shareholder Services of Public Companies. For the periods specified in the latter part of Article 12 and Paragraph 3 of Article 13 of the Regulations Governing the Use of Proxies for Attendance at Shareholder Meetings of Public Companies, Paragraph 2 of Article 44-5, Article 44-15, Paragraph 1

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Amended Provisions	Provisions before Amendment	Remarks
of Article 44-17 of the Regulations Governing the Administration of Shareholder Services of Public Companies, the Company shall proceed on the date of the postponed or re-convened shareholders’meeting per Paragraph.
Article 22 (Handling digital gaps) Where the Company convenes the video shareholders’meetings, the proper alternatives shall be provided for the shareholders having difficulties attending in the manner of video conference.	Added this article	Added this article to accordance with the regulations.
Article23: These Rules shall take effect after having been submitted to and approved by a shareholders’ meeting. Subsequent amendments thereto shall be affected in the same manner. The Rules wereestablishedon May 27, 2020. The 1st amendment was made on June 22, 2022.	Article 19: These Rules shall take effect after having been submitted to and approved by a shareholders’ meeting. Subsequent amendments thereto shall be affected in the same manner. The Rules wereestablishedon May 27, 2020.	I. Revised wording II. Added times of amendment and dates.

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AI assistant

T.S.M.C. — AGM Information 2022

51769_rns_2022-08-08_4a3626ca-abd9-4691-a29b-e429dfc29dfa.pdf

Taiwan Styrene Monomer Corporation Annual General Shareholders' Meeting for 2022 Meeting Agenda (Translations)

1. Call Meeting to Order:

2. Chairman’s Remarks: (Omitted)

3. Report Items

4. Adopting Items

I. To adopt 2021 Business Report and Financial Statements

(Proposed by the board of directors)

Explanatory Notes ：

II. Appropriation of 2021 retained earnings

(Proposed by the board of directors)

Explanatory Notes ：

Resolution ： This proposal was approved and adopted.

5. Discussion Items

I. Amend the Articles of Incorporation

(Proposed by the board of directors)

Explanatory Notes ：

Resolution ： This proposal was approved and adopted.

II. To Approve the Procedures for the Handling of Derivatives Trading (Proposed by the board of directors)

Explanatory Notes ：

Resolution ： This proposal was approved and adopted.

III. To Amend the Procedure for the Acquisition or Disposal of Assets

(Proposed by the board of directors)

Explanatory Notes ：

Resolution ： This proposal was approved and adopted.

IV. To Amend the Rules and Procedures of Shareholders' Meeting

(Proposed by the board of directors)

Explanatory Notes ：

Resolution ： This proposal was approved and adopted.

VI. Extemporary Motions: None

【 Attachment 1 】

Taiwan Styrene Monomer Corporation 2021 Business Report

1.

Results of operations based on the business plan

2. Budget Execution

3. Profitability Analysis

4. Research and Development

5. Management Principles and Prospects

The Audit Committee’s Review Report

Independent Auditors’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Revenue recognition

Other Matter

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

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

KPMG

(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Balance Sheets

December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Comprehensive Income

For the years ended December 31, 2021 and 2020

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

(English Translation of Parent Company Only Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Changes in Equity

For the years ended December 31, 2021 and 2020

(English Translation of Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION

Statements of Cash Flows

For the years ended December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

Independent Auditors ’ Report

Opinion

Basis for Opinion

Key Audit Matters

1. Revenue recognition

Other Matter

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

Auditors ’ Responsibilities for the Audit of the Consolidated Financial Statements

KPMG

Notes to Readers

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

December 31, 2021 and 2020

(Expressed in Thousands of New Taiwan Dollars)

(English Translation of Consolidated Financial Statements Originally Issued in Chinese) TAIWAN STYRENE MONOMER CORPORATION AND SUBSIDIARIES

T.S.M.C. AGM Information 2022

`【` Attachment 1 `】`

`【` Attachment 5 `】`