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Weltrend Annual Report 2024

Jun 5, 2025

52083_rns_2025-06-05_c6bc39ad-3e9f-4811-99b0-378b3e1f4ead.pdf

Annual Report

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Stock Code: 2436

==> picture [127 x 34] intentionally omitted <==

2024

2024 Annual Report

Weltrend Semiconductor, Inc.

Published on April 12, 2025

This Annual Report is available on the Taiwan Stock Exchange Market Observation Post System at https://mopsplus.twse.com.tw

I. Spokesperson: Name: Cindy Guo Title: CFO Tel: (03)5780241 E-mail: [email protected] Deputy Spokesperson: Name: Tony Lin Title: CEO Tel: (03)5780241

E-mail ： [email protected]

  • II. Address:

Headquarters: 2F., No. 24, Industry E. 9th Rd., Hsinchu Science Park, Hsin-Chu 300, Taiwan

Tel: (03)5780241

Kaohsiung Branch: 22F-6., No. 211, Chungcheng 4th Rd., Cianjin District, Kaohsiung City 801, Taiwan

Tel: (07)9718868

  • III. Transfer Agency:

Name: Stock Affairs Agency Department of CTBC Bank

Address: 5F., No.83, Sec. 1, Chongqing S. Rd., Zhongzheng Dist., Taipei City 100, Taiwan (R.O.C.)

Tel: (02)66365566

Website: https://ecorp.ctbcbank.com/cts/index.jsp

  • IV. Certified Public Accountants (CPAs) in Charge of Auditing and Attesting Financial Statements for the Most Recent Year:

  • CPA Firm: Deloitte Taiwan

Names of CPAs: Cheng-Chih Lin, Chih-Yuan Wen

Address: 6F, Allied Association Industries, No. 2, Zhanye 1st Rd., Hsinchu Science Park, East Dist., Hsinchu 300091, Taiwan

Tel: (03)5780899

Website: www.deloitte.com.tw

  • V. Offshore Secondary Exchange and Disclosure Information Available at: Not Applicable.

  • VI. Company Website: www.weltrend.com.tw

Table of Contents

Table of Contents
Chapter 1 Letter to Shareholders ................................................................................................................... 1
I. 2024 Business Performance Analysis ................................................................................. 1
II. 2025 Business Plan Summary ............................................................................................ 2
III. Evaluation of the Company's Future Development Strategy and External Competition .... 3
Chapter 2 Corporate Governance Report ...................................................................................................... 4
I. Information on the Company's Directors, Supervisors, General Manager, Deputy General
Managers, Associate Managers, and the Supervisors of All the Company's Divisions and
Branch Units ....................................................................................................................... 4
II. Remuneration paid to directors (including independent directors), presidents and vice
presidents in the most recent year ..................................................................................... 12
III. Operation of corporate governance................................................................................... 17
IV. CPA fees ............................................................................................................................ 80
V. Change of CPA ................................................................................................................. 81
VI. If the chairman, president, or finance or accounting managers of the Company worked in
the CPA firm or an affiliate thereof within the most recent fiscal year ............................. 83
VII. Changes in transfer or pledge of shares made by directors, supervisors, managers, and
major shareholders holding more than 10% of Company shares ..................................... 83
VIII. Information on top 10 major shareholders who are related to one another or are related as
spouses or within the second degree of kinship. ............................................................... 84
IX. The number of shares held by the Company, its directors, supervisors, managers and
businesses directly or indirectly controlled by the Company ........................................... 85
Chapter 3 Capital Overview ........................................................................................................................ 86
I. Capital and shares of the Company .................................................................................. 86
II. Insurance of corporate bonds ............................................................................................ 92
III. Insurance of preferred shares. ........................................................................................... 93
IV. Overseas depositary receipts ............................................................................................. 93
V. Insurance of employee stock options ................................................................................ 93
VI. Restricted stock for employees ......................................................................................... 93
VII. Issuance of new shares in connection with mergers or acquisitions or with acquisitions
of shares of other companies ............................................................................................ 93
VIII. Implementation of capital utilization plan ........................................................................ 95
Chapter 4 Operating Status .......................................................................................................................... 96
I. Business Activities ............................................................................................................ 96
II. Market, production, and marketing overview ................................................................. 101
III. Employees ...................................................................................................................... 107
IV. Environmental expenditure information ......................................................................... 107
V. Labor-management relationship ..................................................................................... 108
VI. Cyber security management ........................................................................................... 109
VII. Material contracts ............................................................................................................ 110
Chapter 5 Review and Analysis of Financial Position and Financial Performance and Risk Events ......... 111 Review and Analysis of Financial Position and Financial Performance and Risk Events ......... 111
I. Financial status ................................................................................................................ 111
II. Financial performance ..................................................................................................... 112
III. Cash flow ......................................................................................................................... 113
IV. Impact of major capital expenditure on financial operations for the most recent year .... 114
V. The most recent year's reinvestment policy, the main reasons for profit or loss,
improvement plans and investment plans for the coming year ........................................ 114
VI. Risk assessment for the most recent year and up to the publication date of the Annual
Report .............................................................................................................................. 115
VII. Other important matters ................................................................................................... 117
Chapter 6 Special Matters to Be Noted ...................................................................................................... 118
I. Information on the Company Affiliates ........................................................................... 118
II. Private placement of marketable securities in the most recent fiscal year and up to the
publication date of the Annual Report ............................................................................. 118
III. Other supplementary information .................................................................................... 118
Chapter 7 In the most recent fiscal year and up to the publication date of the Annual Report, if there have
been events that had a significant impact on shareholders' equity or the price of securities as
defined in Subparagraph 2 of Article 36-3 of the Securities and Exchange Act ........................ 118

Chapter 1 Letter to Shareholders

I. 2024 Business Performance Analysis

At the beginning of last year, we anticipated that 2024 would be a favorable year marked by solid growth. At the time, our outlook was primarily based on inventory levels having reached a reasonable level, with demand expected to drive growth. Unexpectedly, the explosive growth of AI became the dominant theme throughout the year.

According to World Semiconductor Trade Statistics (WSTS), the total revenue of the global semiconductor market in 2024 was US$627.6 billion, which was a 19.1% growth compared to 2023. Meanwhile, the output value of Taiwan's IC industry, as estimated by the Industrial Technology Research Institute (ITRI), reached NT$5.3151 trillion in 2024, representing a growth of 22.4% compared to 2023. Among them, TSMC alone recorded a remarkable annual revenue of NT$2.8943 trillion, accounting for 54.45% of the entire industry’s total. With a year-on-year growth rate of 33.89%, the company's pivotal role as Taiwan’s "Silicon Shield" has become even more pronounced. In addition, the output value of the IC design industry reached NT$1.2721 trillion, representing a 16% growth compared to 2023. Among them, MediaTek Inc., the leading company in the IC design sector, reported revenues of NT$530.6 billion, reflecting a 22.4% year-on-year growth and accounting for 41.7% of the entire IC design industry’s total revenue. It can be said that these two superstar companies played a dominant role in driving the growth of Taiwan's IC industry last year.

The overall industry landscape for 2024 has been outlined as described above. From an individual perspective, small- and mid-cap stocks within the IC design industry exhibited both growth and decline, primarily depending on the nature of their products. For instance, if consumer-grade MCUs target the Chinese market, they will experience more significant declines. In the consumer market—such as game consoles—IC shipments also experienced significant declines, likely due to excess inventory in the supply chain and the impact of product life cycles. Within the Company’s power management product line, while USB Power Delivery (USB PD) products achieved steady growth driven by continued increases in market penetration, demand for gaming console applications showed signs of weakening, thereby limiting overall growth. It is worth noting that within the Smart Application product line, the Company’s fan motor control ICs have secured a significant position in the market—thanks to technological leadership and the strong demand for thermal solutions in AI servers. Both the head office and subsidiary, Sentelic Corporation, have established a notable presence in this domain.

The Company's key financial figures and explanations for 2024 are summarized as follows:

1

  1. The comparison of the 2024 and 2023 business performance:
Unit: NT$thousands Unit: NT$thousands Unit: NT$thousands
2024 2023 Growth rate
Net sales 2,622,388
2,456,755
6.74%
Grossprofit 710,826
605,891
17.32%
Operatingincome 174,075
87,063
99.94%
Net non-operatingincome (loss) 144,425
149,014
-3.08%
Income tax expenses (42,938)
(26,837)
60.00%
Netprofit after tax 275,562
209,240
31.70%
EPS 1.57
1.18
33.05%

(These statistics are from the parent company only financial statements, which are prepared in accordance with the regulations of the competent authority.)

Overall, while revenue grew by only 6.74%, operating income nearly doubled, reflecting a significant improvement in profitability. The primary reasons were a shift in product mix that led to a 2.45% increase in gross profit margin, along with revenue growth and a reversal of inventory losses into gains. Non-operating income was primarily attributable to foreign exchange gains. Net profit after tax for the year reached approximately NT$276 million, representing a 31.7% growth compared to 2023. Earnings per share (EPS) rose to NT$1.57, up 33.05% from NT$1.18 in 2023.

  1. In 2024, research and development (R&D) expenses amounted to NT$305 million, remaining largely in line with the 2023 level.

  2. Budget implementation status: The Company did not prepare a financial forecast for 2024. Comparison of actual business operation and internal target: Revenue growth fell short of the expected double-digit level, primarily due to the limited growth of Power ICs, which constitute a significant portion of total revenue and thereby pulled down the overall growth rate. Net profit after tax exceeded expectations.

II. 2025 Business Plan Summary

The realization of synergies from the acquisition of Sentelic Corporation in 2022, coupled with over a year of operational integration, the Company has witnessed the emergence of synergistic effects. Following the success of the Power IC product line, the Motor IC product line has also begun to establish a solid foundation. In addition, PCs and notebooks are expected to continue their moderate growth, while gaming consoles are anticipated to re-enter a growth cycle, from which the Company’s Power ICs are likely to benefit. As such, the

2

outlook for 2025 remains optimistic, with the Company aiming for revenue growth that outpaces the industry average. One of the more uncertain factors is the tariff war implemented after Donald Trump took office, which has cast a shadow over market growth.

III. Evaluation of the Company's Future Development Strategy and External Competition

Over two years since the Company’s acquisition of its industry peer Sentelic Corporation, the synergies have begun to materialize, bringing benefits to the shareholders of both companies. Amid the prevailing trend of larger players dominating the market, the Company will continue to actively seek potential acquisition targets, with the aim of integrating resources, expanding operational scale, and strengthening market competitiveness. As for the external environment, the global situation remains volatile and beyond our control. What we can do is to maintain sound financials, ensure a reliable and resilient supply chain, and continuously strengthen talent development and product innovation.

I wish to thank you, our shareholders, for your support.

Best wishes for your investment!

Sam Lin, Chairman DS Lin, President

3

Chapter 2 Corporate Governance Report

  • I. Information on the Company's Directors, Supervisors, General Manager, Deputy General Managers, Associate Managers, and the Supervisors of All the Company's Divisions and Branch Units

(I) Information on directors
(I)
Inf		 orma tion on direc tors March 31,2025
Title Nationality/
Place of
Incorporation
Name		 Gender
Age		 Date of election
(inauguration)		 Term Date first
elected		 Number o
when		 f shares held
elected		 Current shareholding Shares currently held by
spouse and minors		 Shares held
of o		 in the name
thers		 Education and professional background
 Current positions at the Company
and other companies		 Spouses or relatives within the
second degree of kinship who
hold the position of manager,
director or supervisor		 Note
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Title Name Relationship
Chairman Taiwan Sam Lin Male
71~80		 2022.6.23 3
years		 1989.6.16 4,514,000
2.54%		 2,809,000
1.58%		 155,982
0.09%		 1,900,000
1.07%		 Department of Electrophysics, National Yang
Ming Chiao Tung University
Institute of Business Administration, National
Taiwan University
Head of Planning Team, Industrial Technology
Research Institute
President and CEO of Weltrend Semiconductor
Chief Investment Officer of
Weltrend Semiconductor
Chairman of Sentelic Corporation
Chairman of Yingquan Investment
Co., Ltd.
Director of Weltrend International
Co., (BVI)Ltd.		 Director Tony
Lin		 Father and son
(Note 1)
Director Taiwan James
Chou		 Male
71~80		 2022.6.23 3
years		 1989.6.16 2,433,829
1.37%		 2,433,829
1.37%		 - - - - Department of Business Administration,
National Chung Hsing University
Chairman of Weltrend		 Supervisor of Chairman of
Yingquan Investment Co., Ltd.		 - - -
Director Taiwan Paul Liao Male
71~80		 2022.6.23 3
years		 2016.6.8 1,056,998
0.59%		 1,078,468
0.61%		 799
0.00%		 - - Master of Electrical Engineering, Rensselaer
Polytechnic Institute
Master of Business Administration, University
of San Francisco
Chairman of China Electric Manufacturing
Corp.
Chairman of Howard Hotels		 Chairman of Gain First Investments
Limited
Director of Howard Hotels
Independent Director of Kinik
Company, Director of Yingquan
Investment Co., Ltd.
-		 - -
Director Taiwan JC Liu Male
61~70		 2022.6.23 3
years		 2001.5.25 1,808,013
1.02%		 1,808,013
1.02%		 - - - - Institute of Communications Engineering,
National Yang Ming Chiao Tung University
Industrial Technology Research Institute		 Chief R&D Officer of Weltrend
Semiconductor		 - - -
Director Taiwan Cindy Guo Female
61~70		 2022.6.23 3
years		 2007.6.15 1,260,200
0.71%		 1,270,200
0.71%		 - - - - Department of Public Finance, Feng Chia
University
Auditor of Tseng Hsien-Cheng Accounting
Firm
Section Manager of FCF Co., Ltd.		 Chief Financial Officer and
Corporate Governance Officer of
Weltrend Semiconductor, Inc.
Director of Sentelic Corporation
Supervisor of Dongguan Prosil
Electronics Co.,Ltd.		 - - -
Director Taiwan Tony Lin Male
41~50		 2022.6.23 3
years		 2016.6.8 1,021,000
0.57%		 631,000
0.35%		 30,000
0.02%		 400,000
0.22%		 Department of Science in Electrical
Engineering, University of Illinois at
Urbana-Champaign
Institute of Operations Research, Columbia
University
Assistant Manager of European Business
Department of Global Unichip Corporation
Assistant Vice President of Securities Research
Department of Macquarie Group
Special Assistant to the Chairman and
President of Weltrend Semiconductor		 CEO of Weltrend Semiconductor
Director of Sentelic Corporation		 Director Sam
Lin		 Father and son
Director Taiwan Jeff Tsai Male
61~70		 2022.6.23 3
years		 2001.5.25 1,018,362
0.57%		 1,018,362
0.57%		 - - - - Department of Transportation & Logistics
Management, National Yang Ming Chiao Tung
University
EMBA from National Yang Ming Chiao Tung
University
President of Weltrend Semiconductor
Industrial TechnologyResearch Institute		 None - - -
Independent
Director
Taiwan		 Gerald Kuo Male
71~80		 2022.6.23 3
years		 2007.6.15 - 0% - 0% - - - - Department of Electrophysics, National Yang
Ming Chiao Tung University
President of Texas Instruments' semiconductor
marketingbusiness in China		 Independent Director of Promate
Electronic Co., Ltd.		 - - -

4

Title Nationality/
Place of
Incorporation		 Name Gender
Age		 Date of election
(inauguration)		 Term Date first
elected		 Number of shares held
when elected		 Number of shares held
when elected		 Current shareholding Current shareholding Shares currently held by
spouse and minors		 Shares currently held by
spouse and minors		 Shares held in the name
of others		 Shares held in the name
of others		 Education and professional background Current positions at the Company
and other companies		 Spouses or relatives within the
second degree of kinship who
hold the position of manager,
director or supervisor		 Spouses or relatives within the
second degree of kinship who
hold the position of manager,
director or supervisor		 Spouses or relatives within the
second degree of kinship who
hold the position of manager,
director or supervisor		 Note
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio		 Title Name Relationship
Independent
Director		 Taiwan Wei-Kun
Yeh		 Male
61~70		 2022.6.23 3
years		 2016.6.8 - 0% - 0% - - - - Department of Electrophysics, National Yang
Ming Chiao Tung University
Department of Electrical Engineering,
Michigan State University
Chairman and President of Leadtrend
Technology Corporation
Department Manager of Taiwan
Semiconductor Manufacturing Company
Limited		 Chairman of PowerMate
Electronics Co., Ltd.
Director of ICE Technology
Chairman of Eltronix
Director of Caremind		 - - -
Independent
Director		 Taiwan Wen-Tsung
Hsu		 Male
61~70		 2022.6.23 3
years		 2010.6.15 - 0% - 0% 21,998 0.01% - - Department of Law, National Taiwan
University
Incomplete Master’s Program, Graduate
Institute of National Development, National
Taiwan University
Judge of Tainan District Court, Judge of
Taoyuan District Court		 Managing Partner of Hanwe Law
Firm
Independent director of Advanced
Connection Technology Inc.		 - - -

Note 1: If the chairperson, president, or person holding an equivalent position of the company and a person in any of those positions are the same person, spouses, or relatives within the first degree of kinship, the information on reasons, rationality, necessity and countermeasures (such as increasing the number of independent directors and having more than half of the directors not concurrently serving as employees or managers) should be provided. To enhance corporate governance, on November 8, 2022, the Company's Board of Directors approved the adjustment of the management structure. DS Lin was appointed as the new President, while Sam Lin, the Chairman, ceased to concurrently hold the position of Chief Executive Officer. Tony Lin, the former President, was appointed as the Chief Executive Officer to assist the Chairman in overseeing the overall operation of the Company.

5

Major corporate shareholder: None.

(II) Disclosure of professional qualifications of directors and independence of independent directors:

directors:
Criteria
Name
Professional qualifications and experience		 Status of independence Number of
other public
companies in
which the
individual
concurrently
serves as an
independent
director
Chairman
Sam Lin		 Main experience: He used to be the head of Planning
Team, Industrial Technology Research Institute,
President and Chief Executive Officer of Weltrend,
currently serves as Chairman and Chief Investment
Officer of the Company.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.
Not applicable		 None
Director
James Chou
Main experience: Chairman of Weltrend.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.		 Not applicable None
Director
Paul Liao		 Main experiences: He used to be Chairman of China
Electric Manufacturing Corp., Chairman of Howard
Hotels. Currently, he is Chairman of Gain First
Investments Limited, Director of Howard Hotels,
Independent Director of Kinik Company.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.		 Not applicable 1
Director
JC Liu		 Main experience: He used to work for the Industrial
Technology Research Institute. Currently, he serves
as Chief R&D Officer of the Company.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.		 Not applicable None
Director
Cindy Guo		 Main experience: He used to be Auditor of Tseng
Hsien-Cheng Accounting Firm, Section Manager of
FCF Co., Ltd. Currently, he serves as CFO and
Corporate Governance Officer of the Company.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.		 Not applicable None
Director
Tony Lin		 Main experience: He used to be Assistant Manager
of European Business Department of Global Unichip
Corporation, Assistant Vice President of Securities
Research Department of Macquarie Group, Special
Assistant to Chairman of Weltrend Semiconductor,
LTD., President of Weltrend Semiconductor.
Currently, he serves as Chief Executive Officer of
the Company.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.
Not applicable		 None

6

Criteria
Name
Professional qualifications and experience		 Status of independence Number of
other public
companies in
which the
individual
concurrently
serves as an
independent
director
Director
Jeff Tsai		 Main experience: President of ERSO of the
Industrial Technology Research Institute and
Weltrend Semiconductor.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the CompanyAct.		 Not applicable None
Independent
Director
Gerald Kuo
Main experience: He used to be President of Texas
Instruments' semiconductor marketing business in
China. Currently, he serves as Independent Director
of Promate Electronic Co., Ltd.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the Company Act.		 (1) An employee of the company or any of its affiliates.
(2) A director or supervisor of the company or any of
its affiliates.
(3) A natural-person shareholder who holds shares,
together with those held by the person's spouse,
minor children, or held by the person under others'
names, in an aggregate of one percent or more of
the total number of issued shares of the company or
ranking in the top 10 in holdings.
(4) Not the manager listed in (1) or the spouse, relative
within the second degree of kinship, or direct blood
relatives within the third degree of kinship of the
person listed in (2) and (3).
(5) A director, supervisor, or employee of a corporate
shareholder that directly holds five percent or more
of the total number of issued shares of the company,
or that ranks among the top five in shareholdings, or
that designates its representative to serve as a
director or supervisor of the company under Article
27, paragraph 1 or 2 of the Company Act.
(6) If a majority of the company's director seats or
voting shares and those of any other company are
controlled by the same person: a director,
supervisor, or employee of that other company.
(7) If the chairperson, president, or person holding an
equivalent position of the company and a person in
any of those positions at another company or
institution are the same person or are spouses: a
director (or governor), supervisor, or employee of
that other company or institution.
(8) A director, supervisor, officer, or shareholder
holding five percent or more of the shares, of a
specified company or institution that has a financial
or business relationship with the company.
(9) A professional individual who, or an owner, partner,
director, supervisor, or officer of a sole
proprietorship, partnership, company, or institution
that, provides auditing services to the company or
any affiliate of the company, or that provides
commercial, legal, financial, accounting or related
services to the company or any affiliate of the
company for which the provider in the past 2 years
has received cumulative compensation exceeding
NT$500,000,or a spouse thereof;
1
Independent
Director
Wei-Kun
Yeh
Main experiences: He used to be Department
Manager of Taiwan Semiconductor Manufacturing
Company Limited and Chairman and President of
Leadtrend Technology Corporation. Currently, he is
Chairman of PowerMate Electronics Co., Ltd.,
Director of ICE Technology, Chairman of Eltronix,
and Director of Caremind.
At least five years of working experience in the
Company's business.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the Company Act.

None
Independent
Director
Wen-Tsung
Hsu
Main experience: He used to be the Judge of Taiwan
Tainan District Court and the Judge of Taiwan
Taoyuan District Court. Currently, he is the
Managing Partner of Hanwe Law Firm and the
Independent director of Advanced Connection
Technology Inc.
Professional personnel who have passed the national
examinations procurator and attorneys and have
accumulated more than five years of working
experience.
Not under any of the circumstances as set forth in
the subparagraphs of Article 30 of the Company Act.
1

7

  • (III) Diversity and independence of the Board of Directors:

  • Diversity of the Board of Directors:

To implement the diversity policy of the Board of Directors, strengthen corporate governance and promote the sound development of the composition and structure of the Board of Directors, the Company's Corporate Governance Best Practice Principles sets out the policy of diversifying the composition of the Board of Directors, based on the Company's operation, business mode and development needs. In accordance with Article 20 of the Principles, the Board of Directors shall possess abilities to perform operational judgment, conduct accounting and financial analysis, carry out operating and crisis management, and have industry-related knowledge, international market perspective, leadership and decision-making ability.

The Company's Board of Directors consists of members of the management team, managers of related industries, and professionals with professional backgrounds, professional skills and industrial experience in accounting, industry, finance, marketing, technology and law. They perform the duties of board members in different fields and under different working backgrounds.

Currently, the Board of Directors consists of one female and nine male members, with no restrictions on age, nationality, or culture. All members are Taiwanese, with a bachelor degree or higher. In terms of age distribution, 4 directors are over 70 years old, 5 directors are between 61 and 70 years old, and 1 director is below 50 years old. The Company places emphasis on gender equality in the composition of the Board of Directors and aims to have a female director ratio of 10% or more. Currently, the proportion of female directors is 10%.

Where the number of directors on the Company's Board of Directors of either gender does not reach one-third of the board seats, the reason and measures to improve gender diversity among directors shall be stated: Due to the characteristics of the industry, it is not easy to recruit suitable talent in a short period. During this year’s board re-election, the Company has still planned to appoint one female director. Going forward, the Company will seek talent recommendations through various channels such as the industry and academia, gradually increasing the number of female directors. This aims to enhance corporate governance effectiveness and implement the policy of board member diversity.

The implementation of the diversity policy on board members by the Company

Core Items of
Diversity
Name
Nationality		 Gender Age Age Operating
Management		 Leadership &
Decision-making
Industry
Knowledge
Finance &
Accounting		 Research &
Development
Legal
Regulations
41-50 51~60 61~70 71~80
Sam Lin Republic of
China
 Male ˇ ˇ ˇ ˇ ˇ
James Chou Male ˇ ˇ ˇ ˇ
Paul Liao Male ˇ ˇ ˇ ˇ
JC Liu Male ˇ ˇ ˇ ˇ ˇ
Cindy Guo
Female		 ˇ ˇ ˇ ˇ ˇ
Tony Lin
Male		 ˇ ˇ ˇ ˇ
Jeff Tsai Male ˇ ˇ ˇ ˇ
Gerald Kuo Male ˇ ˇ ˇ ˇ
Wei-Kun Yeh Male ˇ ˇ ˇ ˇ ˇ
Wen-Tsung
Hsu		 Male ˇ ˇ ˇ ˇ ˇ

8

  1. Independence of the Board of Directors:

The current Board of Directors of the Company consists of a total of 10 members, including 3 independent directors. The proportion of directors with employee status in the current board is 40%, while independent directors constitute 30%. Independent directors are not allowed to serve consecutive terms exceeding three terms to prevent a decline in their independence due to prolonged tenure, thereby enabling them to objectively exercise their powers. The Company intends to gradually improve the composition of the board, ensuring its independence.

The matters stipulated in Paragraphs 3 and 4 of Article 26-3 of the Securities and Exchange Act are explained as follows:

Sam Lin, Chairman of the Company, and Tony Lin, Director of the Company, are relatives within the second degree of kinship. There are no circumstances where the other directors are related to each other as spouses or to the second degree of kinship.

9

(IV) Information of President, Vice Presidents, Assistant Vice Presidents, Heads of Departments and Branches

March 31, 2025

March 31, March 31, March 31, 2025
Title
(Note 1)		 Nationality Name Gender Date of election
(inauguration)
Shareholding		 Shares held by spouses
and minors		 Shares held in the name
of others		 Experience (Education)
(Note 2)
 Positions currently
held in the Company
or other companies		 Spouse or relatives within the
second degree of kinship who hold
theposition of manager		 Note
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio
Number of
shares
Shareholding
ratio		 Title Name Relationship
Chief Investment
Officer		 Taiwan Sam Lin Male 2023.11.8 2,809,000
1.58%
155,982
0.09%		 1,900,000
1.07%
Department of Electrophysics, National Yang
Ming Chiao Tung University
Institute of Business Administration, National
Taiwan University
Head of Planning Team, Industrial Technology
Research Institute
President and CEO of Weltrend Semiconductor		 Chairman of Sentelic
Corporation
Chairman of Yingquan
Investment Co., Ltd.
Director of Weltrend
International Co.,
(BVI)Ltd.		 Chief
Executive
Officer/CEO
Tony Lin		 Father and
son		 (Note 3)
President Taiwan DS Lin Male 2023.11.8 186,297
0.10%
168
0.00%
-		 - Department of Electrical Engineering, Chung
Yuan Christian University
Institute of Electrical and Computer Engineering,
Syracuse University
Assistant Vice President of Marketing
Department, Jettech System Technology Co.,
Ltd.
Senior Vice President of Weltrend
Semiconductor		 - - - -
Chief Executive
Officer/CEO		 Taiwan Tony Lin Male 2023.11.08 631,000
0.35%
30,000
0.02%
400,000
0.22%
Department of Science in Electrical Engineering,
University of Illinois at Urbana-Champaign
Institute of Operations Research, Columbia
University
Assistant Manager of European Business
Department of Global Unichip Corporation
Assistant Vice President of Securities Research
Department of Macquarie Group
Special Assistant to the Chairman of Weltrend
Semiconductor
President of Weltrend Semiconductor		 Director of Sentelic
Corporation		 Chief
Investment
Officer		 Sam Lin Father and
son
Chief Operation
Officer/COO		 Taiwan Robby
Tsai		 Male 2019.11.06 550,000
0.31%
-		 - - - Department of Electrical Engineering, National
Cheng Kung University
Institute of Electrical Engineering, National
Cheng Kung University
Director of the Audio and Video Applications
Division, MStar Semiconductor, Inc.
President of Signal Test Division, Integrated
Service Technology Inc.
President of GrenergyInc.		 President and CEO of
Sentelic Corporation		 - - -
Chief R&D
Officer		 Taiwan JC Liu Male 2003.03.17 1,808,013
1.02%
-		 - - - Institute of Communications Engineering,
National Yang Ming Chiao Tung University
Industrial TechnologyResearch Institute		 - - - -
Vice President of
R&D		 Taiwan ST Kuo Male 109.02.12 285,410
0.16%		 105,767 0.06%
-		 - Department of Electronic Engineering, Feng
Chia University
Graduate Institute of Electrical Engineering,
National Taiwan University
Senior Engineer of R&D Division, Princeton
Technology Corporation
Vice President of R&D Division, Jettech System
TechnologyCo.,Ltd.		 - - - -

10

Title
(Note 1)		 Nationality Name Gender Date of election
(inauguration)
Shareholding
Shareholding		 Shares hel
and		 d by spouses
minors		 Shares hel
of		 d in the name
others		 Experience (Education)
(Note 2)
 Positions currently
held in the Company
or other companies		 Spouse or relatives within the
second degree of kinship who hold
theposition of manager		 Spouse or relatives within the
second degree of kinship who hold
theposition of manager		 Spouse or relatives within the
second degree of kinship who hold
theposition of manager		 Note
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio
Number of
shares
Shareholding
ratio		 Title Name Relationship
Vice President of
R&D		 Taiwan Vincent
Lu		 Male 2022.07.04 50,094
0.03%
-		 - - - College of Electrical Engineering of National
Tsing Hua University
Senior Director of Research & Development,
Weltrend Semiconductor
Assistant Manager of Digital Design of Andatek
Technology Ltd., Digital Department Manager of
Leadtrend TechnologyCorporation		 - - - -
Vice President of
Product
Development and
Technology
Application
Engineering		 Taiwan Wayne Lo
Male		 2022.07.04 88,000
0.05%
-		 - - - Department of Electrical Engineering, National
Taiwan University of Science and Technology
Department of Electrical Engineering, Florida
Polytechnic University
Business Lead of Elan Corporation, Senior
Director of Weltrend Semiconductor		 - - - -
Vice President and
Chief Financial
Officer as well as
Corporate
Governance
Officer
Taiwan		 Cindy
Guo		 Female 2000.03.01 1,270,200
0.71%
-		 - - - Department of Public Finance, Feng Chia
University
Auditor of Tseng Hsien-Cheng Accounting Firm
Section Manager of FCF Co., Ltd.		 Director of Sentelic
Corporation
Supervisor of
Dongguan Prosil
Electronics Co., Ltd.		 - - -

Note 1: All information of president, vice presidents, assistant vice presidents, heads of departments and branches, and those whose positions equivalent to president, vice presidents, assistant vice presidents, shall be disclosed. Note 2: Experience related to holding the current position, such as having worked in an accounting firm or an affiliated enterprise during the preceding disclosure period, the title and position shall be stated. Note 3: If the Chairperson of the Board of Directors, the President or persons in an equivalent position (top-level executive) of the Company are the same person or each other’s spouses or first-degree relatives, the reasons, rationality, necessity and countermeasures for such circumstances (e.g., increasing the number of independent directors, and having more than half the directors who do not concurrently serve as employees or managers, etc.) shall be provided: To enhance corporate governance, on November 8, 2023, the Board of Directors approved the adjustment of the management structure. DS Lin was appointed as the new President. Sam Lin, the Chairman, ceased to concurrently hold the position of Chief Executive Officer. Tony Lin, the President, was appointed as the Chief Executive Officer to assist the Chairman in overseeing the overall operation of the Company.

11

II. Remuneration paid to directors (including independent directors), presidents and vice presidents in the most recent year

(1) Remuneration to Directors and Independent Directors

December 31, 2024

Unit: NT$ thousands

Title Name Director’s remuneration Director’s remuneration Director’s remuneration Director’s remuneration Director’s remuneration Director’s remuneration Director’s remuneration Director’s remuneration Sum of A, B, C, and D
as a percentage of net
income after tax (%)
(Note 3)		 Sum of A, B, C, and D
as a percentage of net
income after tax (%)
(Note 3)		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Relevant remuneration received by directors who are also concurrently
employed employees		 Sum of A, B, C, D, E, F
and G as a percentage of
net income after tax (%)
(Note 3)		 Sum of A, B, C, D, E, F
and G as a percentage of
net income after tax (%)
(Note 3)
Remuneration
received from
investee or
parent
company
other than the
Company’s
subsidiaries
Compensation (A) Severance pay and
pension (B)		 Directors' remuneration
(C)
(Note 2)		 Allowances
(D)		 Salary, bonus, and
allowance (E)
(Note 4)		 Severance pay and
pension (F)		 Employee compensation
(G)
(Note 5)
The
Company
Consolidated
entities
The
Company		 Consolidated
entities
The
Company		 Consolidated
entities		 The
Company
Consolidated
entities
The
Company
Consolidated
entities		 The
Company
Consolidated
entities
The
Company
Consolidated
entities		 The
Company		 Consolidated
entities		 The
Company
 Consolidated
entities
Cash Shares Cash Shares
Director Sam Lin - - - - 8,175
8,466
1,008
1,068
9,183
3.33%
9,534
3.46%
12,754
13,114
784
784
1,758
-		 1,758
-		 24,479
8.88%
25,190
9.14%

-
James Chou
JC Liu
CindyGuo
TonyLin
Paul Liao
Jeff Tsai
Independent
Director		 Gerald Kuo - - - - 3,066
3,066
432
432
3,498
1.27%
3,498
1.27%
-		 - - - - - - - 3,498
1.27%
3,498
1.27%

-

Wei-Kun
Yeh
Wen-Tsung
Hsu
1.
Please state the policies, systems, standards, and structure of independent directors’ remuneration payment and describe the relevance of their responsibilities, risks, and time of investment to the amount of remuneration. In accordance with the Company’s Regulations
Governing the Remuneration of Directors and Managers, the remuneration of the company's directors (including independent directors) includes monthly fixed remuneration and director’s remuneration stipulated in accordance with the Articles of Association. The
remuneration of directors shall be no more than 4% of the current pre-tax net profit in accordance with the Articles of Association, and shall be submitted to the Shareholders' Meeting for report after being examined by the Remuneration Committee and approved by the
Board of Directors. In addition to referring to the industry standards for payment, reasonable compensation shall be given based on factors such as time invested, degree of operational participation, responsibilities undertaken, contribution to the Company, risk events,
personal performance, corporate operational performance, and future risks.
2.
Except as disclosed in the above chart, remuneration to directors received due to the services (e.g. acting as a consultant, instead of an internal employee, of the parent company/all companies listed in the financial reports/reinvestment business) provided to all
companies listed in the financial statement in the most recent year: NT$ 360 thousand

Note 1: Directors' remuneration distributed by the Board of Directors in the most recent year.

  • Note 2: Net profit after tax means net profit after tax in the most recent year; If IFRS has been adopted, this term means net profit after tax stipulated in the individual financial reports in the most recent year.

  • Note 3: The salary and expenses recognized in accordance with IFRS2 "Share Based Payment" include the acquisition of stock warrants for employees, new shares with limited rights for employees and participation in the cash increase for shares, etc.

  • Note 4: The employee remuneration (including stock and cash) obtained by directors who are concurrently employed employees in the most recent year shall disclose the amount of employee remuneration distributed by the Board of Directors in the most recent year. If it fails to be estimated, the proposed distribution amount for the current year shall be calculated based on the actual distribution amount last year.

  • Note 5: The remuneration disclosed in this table is different from the concept of income in the Income Tax Act. This table is for information disclosure and not for taxation purposes.

12

Table of Remuneration Range

Range of remuneration paid to the
Company’s directors		 Name Name Name Name
Total of (A+B+C+D) Total of (A+B+C+D+E+F+G)
The Company Consolidated entities The Company Consolidated entities
Less than NTD 1,000,000 - - - -
NT$1,000,000 –NT$1,999,999 James Chou, Paul Liao, JC Liu,
Cindy Guo, Tony Lin, Jeff Tsai,
Gerald Kuo, Wei-Kun Yeh,
Wen-Tsung Hsu		 James Chou, Paul Liao, JC Liu,
Cindy Guo, Tony Lin, Jeff Tsai,
Gerald Kuo, Wei-Kun Yeh,
Wen-Tsung Hsu

James Chou, Paul Liao, Jeff Tsai,
Gerald Kuo, Wei-Kun Yeh,
Wen-Tsung Hsu
James Chou, Paul Liao, Jeff Tsai,
Gerald Kuo, Wei-Kun Yeh,
Wen-Tsung Hsu
NT$2,000,000 –NT$3,499,999 Sam Lin Sam Lin - -
NT$3,500,000 –NT$4,999,999 - - Cindy Guo Cindy Guo
NT$5,000,000 –NT$9,999,999 - - Sam Lin, JC Liu, Tony Lin Sam Lin, JC Liu, Tony Lin
NT$10,000,000 –NT$14,999,999 - - - -
NT$15,000,000 –NT$29,999,999 - - - -
NT$30,000,000 –NT$49,999,999 - - - -
NT$50,000,000 –NT$99,999,999 - - - -
Above NT$ 100,000,000 - - - -
Total 10 10 10 10

13

(2) Remuneration for President and Vice Presidents

December 31, 2024 Unit: NT$ thousands

Title Name Salary (A) Salary (A) Severance pay and
pension (B)		 Severance pay and
pension (B)		 Bonuses and special
expenses, etc. (C)
(Note 3)		 Bonuses and special
expenses, etc. (C)
(Note 3)		 Employee compensation (D)
(Note 4)		 Employee compensation (D)
(Note 4)		 Employee compensation (D)
(Note 4)		 Employee compensation (D)
(Note 4)		 Sum of A, B, C, and D
as a percentage of net
income after tax(%)		 Sum of A, B, C, and D
as a percentage of net
income after tax(%)		 Remuneration
received from
investee or
parent company
other than the
Company’s
subsidiaries
The
Company
Consolidated
entities		 The
Company
Consolidated
entities		 The
Company
Consolidated
entities		 The Company Consolidated
entities		 The
Company
Consolidated
entities
Cash Shares
Cash		 Shares
Chief Investment Officer Sam Lin 21,281 22,841
1,553
1,553

4,700

5,300

3,518
(Note 3)
-
4,242
(Note 3)
-
31,052
11.27%


33,936
12.32%


-
President DS Lin
Chief Executive Officer/CEO TonyLin
Chief Operation Officer/COO RobbyTsai
Chief R&D Officer JC Liu
Vice President and Chief
Financial Officer as well as
Corporate Governance Officer
Cindy Guo
Vice President Jesse Lu(Note 1)
Vice President ST Kuo
Vice President Wayne Lo
Vice President Vincent Lu

Note 1: Jesse Lu retired on April 25, 2024.

Note 2: The salary and expenses recognized in accordance with IFRS2 "Share Based Payment" include the acquisition of stock warrants for employees, new shares with limited rights for employees and participation in the cash increase for shares, etc.

Note 3: The remuneration (including stock and cash) of those who are president and vice presidents distributed by the Board of Directors in the most recent year. If it fails to be estimated, the proposed distribution amount for the current year shall be calculated based on the actual distribution amount last year. This is the estimated amount of proposed distributions.

Note 4: The remuneration disclosed in this table is different from the concept of income in the Income Tax Act. This table is for information disclosure and not for taxation purposes.

Table of Remuneration Range

Table of Remuneration Range
Range of remuneration paid to the Company’s
president and vicepresidents		 Name of President and Vice Presidents
The Company Consolidated entities
Less than NTD 1,000,000 Jesse Lu Jesse Lu
NT$1,000,000 –NT$1,999,999 - -
NT$2,000,000 –NT$3,499,999 CindyGuo,DS Lin,RobbyTsai,ST Kuo,Wayne Lo,Vincent Lu CindyGuo,DS Lin,ST Kuo,Wayne Lo,Vincent Lu
NT$3,500,000 –NT$4,999,999 Sam Lin,JC Liu,TonyLin JC Liu,TonyLin,Vincent Lu,RobbyTsai
NT$5,000,000 –NT$9,999,999 - Sam Lin
NT$10,000,000 –NT$14,999,999 - -
NT$15,000,000 –NT$29,999,999 - -
NT$30,000,000 –NT$49,999,999 - -
NT$50,000,000 –NT$99,999,999 - -
Above NT$100,000,000 - -
Total 10 10

14

Employee remuneration distributed to managers and status of distribution

December 31, 2024 Unit: NT$ thousands

Title Name Shares Cash Total Ratio of total
remuneration to
net income(%)
Manager Chief Investment
Officer		 Sam Lin -
 3,518 3,518 1.28%
President DS Lin
Chief Executive
Officer/CEO		 Tony Lin

Chief R&D Officer		 JC Liu

Chief Operation
Officer/COO		 Robby Tsai
Vice President CindyGuo
Vice President ST Kuo
Vice President Wayne Lo
Vice President Vincent Lu

Note: The employee remuneration (including stock and cash) obtained by those who are managers in the most recent year shall disclose the amount of employee remuneration distributed by the Board of Directors in the most recent year. If it fails to be estimated, the proposed distribution amount for the current year shall be calculated based on the actual distribution amount last year. Net profit after tax means net profit after tax in the most recent year; If IFRS has been adopted, this term means net profit after tax stipulated in the individual financial reports in the most recent year.

  • (3) Separately compare and describe total remuneration, as a percentage of net income stated in the parent company only financial reports or individual financial reports, as paid by this company and by each other company included in the consolidated financial statements during the past two fiscal years to directors, president, and vice presidents, and analyze and describe remuneration policies, standards, and packages, the procedure for determining remuneration, and its linkage to operating performance and future risk exposure:

  • Percentage of net income stated in the parent company only financial reports or individual financial reports, as paid by this company and by each other company included in the consolidated financial statements during the past two fiscal years to directors, supervisors, president, and vice presidents:

Title Total remuneration as a percentage of net income after tax stipulated in
individual financial reports		 Total remuneration as a percentage of net income after tax stipulated in
individual financial reports		 Total remuneration as a percentage of net income after tax stipulated in
individual financial reports		 Total remuneration as a percentage of net income after tax stipulated in
individual financial reports
2024 2023
The
Company		 All companies included
in the consolidated
financial statements
The
Company		 All companies included
in the consolidated
financial statements
Director 10.15%
10.41%
11.87%
12.07%
President and
Vicepresident		 11.27%
12.32%
15.63%
16.59%

  1. Remuneration policies, standards, and packages, the procedure for determining remuneration, and its linkage to operating performance and future risk exposure:

  2. a. According to the Company's Regulations Governing the Remuneration of Directors, Supervisors and Officers, the remuneration of the Company's directors and supervisors includes traveling expenses and the salary of directors and

15

supervisors. The amount of traveling expenses is set by the Board of Directors with reference to industry standards in accordance with the Company's Articles of Incorporation. The remuneration of the directors and supervisors shall be allocated in accordance with Article 20 of the Articles of Association, and shall be submitted to the Shareholders' Meeting for report after being examined by the Remuneration Committee and approved by the Board of directors.

The remuneration of the president and vice presidents of the Company shall include salary, bonus and employee compensation, etc. It also takes into account the personal performance, corporate operational performance, and future risk, and refers to the standards set by peers for positions of the same nature. The remuneration shall be reviewed by the Compensation Committee and approved by the Board of Directors

  • b. In accordance with Article 20 of the Company’s Articles of Incorporation, the Company shall set aside 11-15% of the net income before tax for employee compensation and not more than 4% for director’ compensation. However, if the Company has accumulated losses (including adjustment on non-distributed earnings), the Company shall set aside a part of the profit first to make up for the losses.

The employees' remuneration specified in the preceding paragraph may be paid in stocks or cash, and may be paid to employees of parents or subsidiaries of the Company who meet the requirements stipulated by the Board of Directors. The Directors' remuneration specified in the preceding paragraph shall only be distributed in cash. The procedures in the two preceding paragraphs must be approved by the Board of Directors and reported to the shareholders' meeting.

  • c. In addition to the industry standards, the performance evaluation and compensation of directors, supervisors and managers shall be based on their abilities, time invested, degree of operational participation, responsibilities undertaken, contribution to the Company, achievement of personal goals, personal performance, performance in other positions, and risk events such as violations of the Code of Ethical Conduct and personnel fraud. The Company evaluates the relationship between individual performance and the Company's operating performance, operational status and future risks and give reasonable remuneration based on the achievement of short-term and long-term business objectives, the Company's financial condition, etc. The remuneration system for directors and managers is reviewed from time to time in accordance with the Company's operating conditions and changes in laws and regulations.

16

III. Operation of corporate governance:

(I) Information on the operation of the Board of Directors

The Board of Directors held 7 meetings (A) in 2024, and the attendance of directors are as follows:

Title Name Number of
attendances
(presence) in
person(B)
Proxy
attendances
Attendance
(presence)
rate (%) (B/A)
Note
Chairman Sam Lin 7 - 100% Serve for another term of office
Director James Chou
7		 - 100% Serve for another term of office
Director JC Liu 7 - 100% Serve for another term of office
Director CindyGuo 7 - 100% Serve for another term of office
Director TonyLin 7 - 100% Serve for another term of office
Director Paul Liao 7 - 100% Newly-appointed
Director Jeff Tsai 7 - 100% Newly-appointed
Independent
Director		 Gerald Kuo
7		 - 100% Serve for another term of office
Independent
Director		 Wei-Kun
Yeh		 7 - 100% Serve for another term of office
Independent
Director		 Wen-Tsung
Hsu		 7 - 100% Newly-appointed
Other matters:
I.
With regard to the operations of the Board of Directors, if any of the following circumstances
occur, the dates, terms of the meetings, contents of motions,
all independent directors’ opinions, and the Company’s response shall be specified:
(I) Matters stipulated in Article 14-3 of the Securities and Exchange Act
The Company has established the Audit Committee in accordance with Article 14-5 of the
Securities and Exchange Act, thus exempting it from the requirement. For further details,
please refer to the operation of the Audit Committee in this year's annual report, available
on P.20.
(II) Other resolutions of the Board to which independent director(s) voiced objection or
reservation that are documented or issued through a written statement in addition to the
above: None.
II.
When a director abstains due to being a stakeholder in certain proposals, the name of the
director, the content of motion, reasons for abstentions,
and the results of vote counts should be stated: None.
III. For information on the evaluation cycle, duration, scope, method, and content of the Board of
Directors' self (or peer) review, please refer to P.18.
IV. Assessment of the objectives and performance of strengthening the functions of the Board of
Directors (such as establishing the Audit Committee, enhancing information transparency, etc)
in the current and recent years: The Company has formulated the Rules of Procedure for
Meetings of Board of Directors in accordance with the Regulations Governing Procedure for
Board of Directors Meetings of Public Companies, and disclosed the attendance of directors at
Board meetings on the Market Observation Post System and the important decisions of the
Board of Directors on the Company's website. The Company has carried out the performance
evaluation of the Board of Directors since 2020, and established the Audit Committee after the
re-election of directors at the Shareholders' Meeting in 2022. Additionally, the Company has
conducted the performance evaluation of the Audit Committee since 2022.
The Board of Directors of the Company appointed the members of the 5th Remuneration
Committee on July4,2022. The three members are all independent directors. The Committee

17

is responsible for formulating and regularly reviewing the policies, systems, standards and structure of performance objectives and compensation for directors and managers. Besides, it regularly evaluates and reviews the reasonableness of the remuneration of directors and managers, staff remuneration and other incentives of employees. The Company has implemented the performance evaluation of the Remuneration Committee since 2020.

Performance Evaluation of Board of Directors and Functional Committee

Evaluation
cycle		 Evaluation
period		 Scope of
evaluation		 Evaluation
method		 Content of evaluation
Once a year
2024.01.01~
2024.12.31
Performance
evaluation of
the Board of
Directors,
board members
and functional
committees
Internal
questionnaire
survey was
adopted to
conduct
internal
self-evaluation
of the Board of
Directors,
board members
and functional
committees

The performance evaluation of Board of
Directors involve the following five
aspects:
1. Level of involvement in company
operations
2. Improvement in the quality of
decision making by the Board of
Directors
3. Composition and structure of the
Board of Directors
4. Selection and continuing education of
directors
5. Internal control
The performance evaluation of board
members involve the following six
aspects:
1. Mastery of company goals and
missions
2. Understanding of directors’ duties and
responsibilities
3. Level of involvement in company
operations
4. Internal relationship management and
communication
5. Professional and continuing education
for directors
6. Internal control
The performance evaluation of functional
committee involve the following five
aspects:
1. Level of involvement in company
operations
2. Understanding of the duties and
responsibilities of the functional
committee
3. Improvement in the quality of
decision-making within the functional
committee
4. Composition of functional committee
and selection of committee members
5. Internal control

18

The results of the performance evaluation of the Board of Directors, board members and functional committees for 2024 were presented to the Board of Directors on March 7, 2025. The overall score of this evaluation is between 4 points (good) and 5 points (excellent), indicating that the overall operation of the Board of Directors and the Functional Committee IS in good condition and meets the requirements of corporate governance. The Company will constantly strengthen and enhance the effectiveness of corporate governance based on the evaluation results of the Board of Directors and the Functional Committee.

  • (II) The operation of Audit Committee

  • The operation of the Audit Committee primarily aims to assist the Board of Directors in supervising the following matters:

    • a. The appropriateness of the Company's financial statements.

    • b. The selection (appointment) and independence and performance of the Certified Public Accountant.

    • c. The effective implementation of internal controls within the Company.

    • d. Compliance with relevant laws and regulations by the Company.

    • e. The management and control of existing or potential risks faced by the Company.

  • The main matters deliberated by the Audit Committee include:

    • a. Formulate or amend the internal control system pursuant to Article 14-1 of the Securities and Exchange Act.

    • b. Assess the effectiveness of the internal control system.

    • c. Adopt or amend, pursuant to Article 36-1 of the Securities and Exchange Act, the procedures for handling financial or business activities of a material nature, such as acquisition or disposal of assets, derivatives trading, loaning of funds to others, and provision of endorsements or guarantees for others.

    • d. Matters in which a director is an interested party.

    • e. Asset transactions or derivatives trading of a material nature.

    • f. Loans of funds, endorsements, or provision of guarantees of a material nature.

    • g. Offering, issuance or private placement of any equity-based securities.

    • h. Appointment, dismissal or compensation of CPAs.

    • i. Appointment or dismissal of finance manager, accounting manager or chief internal auditor.

    • j. The annual financial report signed or sealed by the chairman, the manager and the accounting supervisor and the quarterly financial report signed or sealed by the chairman, the manager and the accounting supervisor and examined by CPAs.

    • k. Other major matters stipulated by the Company or the competent authorities.

19

  1. The Audit Committee held 6 meetings (A) in 2024. The independent directors present are as follows:
Title Name Attendance in
person (B)		 Proxy
attendances		 Attendance rate (%)
(B/A)		 Note
Independent
Director
(Convener)		 Gerald Kuo 6 0 100 Serve for another
term of office
Independent
Director		 Wei-Kun Yeh 6 0 100 Serve for another
term of office
Independent
Director		 Wen-Tsung Hsu
6		 0 100 Newly-appointed
Other matters:
I.
With regard to the operation of the Audit Committee, the date and session of meeting, content of
motions, content of dissenting opinions, qualified opinions or major recommendations from
independent directors, resolutions passed by the Audit Committee, and the Company’s actions
in response to opinions from members of the Audit Committee shall be specified if any of the
followingcircumstances occurs:
(I) Matters stipulated in Article 14 -5 of the Securities Exchange Act.
Date and
term of the
Board of
Directors
Date and
term of the
Audit
Committee
Content of the motion and subsequent
handling
Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act
Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term
2024.2.26
9th meeting
of the 1st
term
1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes
No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.		 (I) Matters stipulated in Article 14 -5 of the Securities Exchange Act.
Date and
term of the
Board of
Directors
Date and
term of the
Audit
Committee
Content of the motion and subsequent
handling
Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act
Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term
2024.2.26
9th meeting
of the 1st
term
1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes
No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.		 (I) Matters stipulated in Article 14 -5 of the Securities Exchange Act.
Date and
term of the
Board of
Directors
Date and
term of the
Audit
Committee
Content of the motion and subsequent
handling
Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act
Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term
2024.2.26
9th meeting
of the 1st
term
1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes
No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.		 (I) Matters stipulated in Article 14 -5 of the Securities Exchange Act.
Date and
term of the
Board of
Directors
Date and
term of the
Audit
Committee
Content of the motion and subsequent
handling
Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act
Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term
2024.2.26
9th meeting
of the 1st
term
1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes
No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.		 (I) Matters stipulated in Article 14 -5 of the Securities Exchange Act.
Date and
term of the
Board of
Directors
Date and
term of the
Audit
Committee
Content of the motion and subsequent
handling
Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act
Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term
2024.2.26
9th meeting
of the 1st
term
1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes
No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.
Date and
term of the
Board of
Directors		 Date and
term of the
Audit
Committee		 Content of the motion and subsequent
handling		 Matters
stipulated in
Article 14 -5
of the
Securities
Exchange Act		 Resolutions not
approved by the
Audit Committee
but agreed by
more than
two-thirds of all
directors
2024.2.26
12th meeting
of the 12th
term		 2024.2.26
9th meeting
of the 1st
term		 1. Review of the 2023 Business Report and
Financial Statements of the Company.
2. Review of the distribution of earnings of
the Company for 2023.
3. Review of the issuance of the benchmark
date for the Company's first unsecured
convertible corporate bonds into
ordinary shares in the domestic market.
4. Review on the report of reference items
for the judgment of the effectiveness of
the Company's internal control system
for 2023 and the report on the statement
of internal control system for 2023.
5. Review of the appointment and
dismissal of CPAs and the independent
and suitability assessment of CPAs in
2024.
Yes		 No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.

20

2024.5.8
14th meeting
of the 12th
term		 2024.5.8
10th meeting
of the 1st
term
1. Review of the financial report of the
CompanyforQ1 2024.		 Yes No

Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.
2024.8.7
15th meeting
of the 12th
term		 2024.8.7
11th meeting
of the 1st
term		 1. Review of the financial report of the
CompanyforQ2 2024.		 Yes No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.
2024.8.23
16th meeting
of the 12th
term		 2024.8.23
12th meeting
of the 1st
term		 1. Review on matters related to the transfer
of treasury shares to employees within
the Company.		 Yes No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.
2024.11.6
17th meeting
of the 12th
term		 2024.11.6
13th meeting
of the 1st
term
1. Review on the proposal to change the
Company's CPAs.
2. Review of the financial report of the
Company for Q3 2024.
3. Review the amendment to the Rules of
Procedure for the Shareholders' Meeting
4. Review the amendment to the "Audit
Committee Charter"
5. Review the amendment to the
"Information and Communication
SecurityOperation Guidelines."		 Yes No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.
2024.12.19
18th meeting
of the 12th
term		 2024.12.19
14th meeting
of the 1st
term		 1. Review on the proposal to amend the
operational items of the Company’s
―Internal Control System.‖
2. Review on the proposal to establish the
Company’s ―Sustainability Report
Preparation and Assurance Procedures.‖
3. Review of the Company's internal audit
plan for 2025.		 Yes No
Resolution of the Audit Committee: Approved by all members of the Audit
Committee.
The Company's handling of the Audit Committee's opinion: Approved by all
the directors present.

(II) Other resolutions not approved by the Audit Committee but agreed by more than two-thirds of all directors: None.

21

II. II. When an independent director abstains due to being a stakeholder in certain proposals, the name When an independent director abstains due to being a stakeholder in certain proposals, the name When an independent director abstains due to being a stakeholder in certain proposals, the name When an independent director abstains due to being a stakeholder in certain proposals, the name When an independent director abstains due to being a stakeholder in certain proposals, the name When an independent director abstains due to being a stakeholder in certain proposals, the name
of the independent director, the content of motion, reasons for abstentions, and the results of
vote counts should be stated: None.
III. Communication between independent directors and internal audit supervisors & CPAs
(including important matters, methods and results of communication on the company's financial
and business status): CPAs attend the meeting of Audit Committee held every quarter, and CPAs
report on the examination or review results of the financial statements and other communication
matters required by relevant laws and regulations, and communicate whether there are any
material adjustment entries or statutory amendments affecting the accounts. A meeting may be
called at any time in the event of a major anomaly.
Summaryof communication between independent directors and CPAs in 2024:
Date Communication
method		 Communication highlights Suggestions and
results
2024/2/26 9th meeting of the
1. Report on the Audit Results and Conclusions of the
1st term of the Consolidated Financial Statements for 2023.
Audit Committee 2. Audit Quality Indicator (AQI) Report.
3. Introduction to upcoming applicable standards and
2024/5/8
2024/8/7		 10th meeting of
the 1st term of the
AuditCommittee
11th meeting of
the 1st term of the
regulations.

1. Report on the Audit Results of the Consolidated
Financial Statements for Q1 2024.
2. Introduction to regulatoryupdates.

1. Report on the Audit Results of the Consolidated
Financial Statements for Q2 2024.		 The independent
directors have
expressed no
objections or
reservations.
AuditCommittee
2024/11/6 13th meeting of 1. Report on the Audit Results of the Consolidated
the 1st term of the
Financial Statements for Q3 2024.
Audit Committee 2. Introduction to regulatoryupdates.
The independent directors and the internal audit supervisor hold at least one communication
meeting or symposium every year. The internal audit supervisor also presents reports on the
Company's internal audit performance and internal control operations to the Audit Committee
each quarter. A meeting may be called at any time in the event of a major anomaly.
Summary of communication between independent directors and internal audit supervisor in 2024:
Date Communication
method		 Communication highlights Suggestions and
results
2024/2/26 9th meeting of Review on the report on the reference items for the
the 1st term of the
judgment of the effectiveness of the Company's internal
Audit Committee control system for 2023 and the report on the discussion of
internal control system for 2023.
2024/5/8 10th meeting of Internal Audit Performance for Q1 2024.
the 1st term of the
AuditCommittee
2024/8/7 11th meeting of Internal Audit Performance for Q2 2024. The independent
the 1st term of the directors have
AuditCommittee expressed no
2024/11/6 Symposiums 1. Report on internal audit performance. objections or
2. Report on the implementation status of the 2024 Audit reservations.
Plan.
2024/11/6 13th meeting of Internal Audit Performance for Q3 2024.
the 1st term of the
Audit Committee
2024/12/19 14th meeting of 1. Discussion on the revision of Internal Control Systems.
the 1st term of the
2. Discussion on the internal audit plan for 2025.
Audit Committee

22

(III) Implementation of corporate governance, deviations from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies, and the reasons therefore:

Companies,and the reasons therefore:
Evaluation items Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
I.
Has the Company established and disclosed its
corporate governance best practice principles based
on the Corporate Governance Best Practice Principles
for TWSE/TPEx Listed Companies?		 The Company has established its Corporate Governance Best Practice Principles
based on the Corporate Governance Best Practice Principles for TWSE/TPEx
Listed Companies, and disclosed it on the Market Observation Post System and
its official website.
No deviation
II.
Shareholding structure and shareholders’ rights
(I)
Has the Company established an internal operating
procedure for handling shareholder proposals,
inquiries, disputes, and litigations? Are such matters
handled according to the internal procedure?
(II) Does the Company maintain a register of the major
shareholders with controlling power, as well as a
register of the ultimate controller of those major
shareholders?
(III) Does the Company establish and enforce the risk
control mechanism and firewall mechanism between
itself and its associates?
(IV) Does the Company stipulate internal rules that
prohibit company insiders from trading securities
using information not disclosed to the market?

(I)
The Company has not established an internal operating procedure for
handling shareholder proposals, inquiries, disputes, and litigations. Such
operating procedure will be formulated according to the actual needs of
the Company.
(II)
The Company has a register of shareholders provided by the stock agent,
which is appointed by the Company.
(III) The assets and financial management rights and responsibilities between
the Company and affiliates are quite clear, and are handled in accordance
with relevant regulations. Besides, related matters are dealt with
according to the established internal control operations.
(IV) The Company has established the Code of Ethical Conduct, the Code of
Ethical Conduct for Staff and the Internal Procedures for Handling
Material Information to prohibit Company insiders from using
unpublished information in the market to buy or sell the Company's
shares.		 The Company has
not established an
internal operating
procedure for
handling
shareholder
proposals, inquiries,
disputes, and
litigations. Such
operating procedure
will be formulated
according to the
actual needs of the
Company.
III. Composition and functions of the Board of Directors
(I)
Has the Board of Directors formulated a strategy to
achieve diversity among board members. If so, is
such strategy being implemented?
(II) In addition to establishing a Remuneration Committee
and Audit Committee as required by law, has the
Company voluntarily established other Functional
Committees?

(I)
Article 20 of the Company's Corporate Governance Best Practice
Principles propose the policy of diversity in the composition of the Board
of Directors, which is formulated in relation to the Company's operations,
business modes and development needs. It includes but not limited to the
following two aspects:
1.
Basic conditions and values: gender, age, nationality, culture, etc.
The Board of Directors consists of 1 female and 9 male members		 No deviation

23

Evaluation items Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(III) Has the Company established standards to measure
the performance of the Board of Directors, and does
the Company implement these standards on a regular
basis? Are the results submitted to the Board of
Directors and used as references for directors’
remuneration and nominations for reappointment?
(IV) Does the Company regularly assess the independence
of its CPAs?
without any restriction on age, nationality or culture, etc. Currently,
all board members are Taiwanese, with bachelor degrees or above.
Among the 3 independent directors, 2 have 7-9 years of relevant
working experience and 1 has 0-3 years of relevant working
experience. The Company places emphasis on gender equality in the
composition of board members and aims to have a female director
ratio of 10% or more. Currently, the ratio of female directors is
10%.
2.
To implement the company's policy of diversifying the board
members, directors shall have different professional backgrounds in
accounting, industry, finance, marketing, technology, law, etc. The
provisions of the Company's Corporate Governance Best Practice
Principles have been disclosed on the Market Observation Post
System and its official website. Please refer to P.8 of this Annual
Report for information on the implementation of the diversity policy
by directors.
(II)
The Company set up a special committee on mergers and acquisitions on
December 29, 2020. There is no need to set up other functional
committees for the time being, which will be handled in due course
depending on the actual needs of the Company.
(III) The Board of Directors adopted the Rules for Performance Evaluations of
the Board of Directors and Functional Committee on March 12, 2020 to
conduct the performance evaluation of the overall Board of Directors,
board members, and the functional committee once a year. The results of
the Company's performance evaluation for 2024 were presented to the
Board of Directors in the first quarter of 2025, and recommendations for
improvement were made. In accordance with the provisions of the
competent authorities, the Company regularly conducts performance
evaluation every year and applies the results of performance evaluation to
the salaryand compensation of directors and the nomination and renewal

24

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
of their appointment. Please refer to P.18 for the implementation of
performance evaluation of the Board of Directors and functional
committee.
(IV) The Company regularly evaluates the independence and suitability of
CPAs every year, the Committee conducts the evaluation and report the
evaluation results to the Board of Directors. In addition to referring to
Communique No. 10: Integrity; Fairness; Objectivity and Independence
of the Taiwan CPA Association, the Company has evaluated the
independence and suitability of CPAs based on Audit Quality Indicators
(AQI), and Statement of the Independent CPAs and Communication with
Governance Units on AQI. After evaluation by the Company, it is
confirmed that CPAs have no other financial interests and business
relationship with the Company other than the fees for certification and
financial tax, and CPAs’ family members have not violated the
independence requirement. According to AQI, it is confirmed that the
auditing experience and training hours of CPAs and firms are better than
the average level of the industry, and they constantly introduce digital
audit tools to improve audit quality, and CPAs meet the requirements for
independence and suitability. The latest evaluation was reviewed and
approved by the Audit Committee on March 7, 2025, and then submitted
to the Board of Directors for approval. Please refer to P.31 of this Annual
Report for the evaluation criteria for the independence of CPAs.
IV. Does the Company have sufficient qualified corporate
governance personnel in place and assign a chief
corporate governance officer to handle matters
relating to corporate governance (including but not
limited to providing directors and supervisors with
materials necessary to perform their duties, assisting
directors and supervisors in legal compliance,
handling matters in connection with the Board
Meetingandthe Shareholders’ Meetingin accordance
Five employees from the Executive Office of the President, Finance Department
and Human Resources Department are responsible for affairs related to
corporate governance. On May 8, 2023, the Board of Directors resolved to
appoint Ms. Cindy Guo, the Chief Financial Officer, as the Director of
Corporate Governance Officer. Ms. Guo, the CFO, possesses over three years of
experience in financial, accounting, and stock management operations of
publicly traded companies. The main responsibilities of corporate governance
officer include providing the information required by the directors to carry out
business,assistingthe directors to comply with laws and regulations,handling		 No deviation

25

Evaluation items Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
with laws and regulations, and preparing meeting
minutes for Board Meetings and Shareholders’
Meetings)?		 the relevant matters of the Board of Directors and the Shareholders' Meeting
according to law, and helping the Board of Directors strengthen the
implementation of functions and safeguard the rights and interests of
stakeholders.
V.
Does the Company establish communication channels
between stakeholders (including but not limited to
shareholders, employees, clients and suppliers), set up
a stakeholder section on the Company’s website, and
respond appropriately to important corporate social
responsibility issues of concern to stakeholders?

The Company respects the rights and interests of stakeholders, identifies
stakeholders, understands their reasonable expectations and needs through
appropriate communication, and appropriately responds to important CSR
issues they are concerned about. Relevant departments are responsible for the
communication with stakeholders, and a "Stakeholder Section" is set up on the
Company’s website under "Sustainable Development" to disclose the
information on stakeholder interactions and business operations. The content
includes stakeholders, major issues of concern, needs and expectations,
communication channels and achievements of the year, which provides
reference for stakeholders and the general public. The Company regularly
reports to the Board of Directors in the fourth quarter of each year on its
communication with stakeholders during the year. The contact information of
stakeholders is available on the Company's website so that appropriate
responses to stakeholder concerns can be made in a timely manner. The
feedback from stakeholders is the basis for continuous improvement and
progress of the Company. For information on stakeholder interactions and
business operations, please refer to P.31 to P.35 of this Annual Report.		 No deviation
VI. Does the Company commission a professional
shareholder services agency to handle matters in
connection with the Shareholders’ Meeting?		 The Company commission Chinatrust Commercial Bank, a professional
shareholder services agency to handle matters in connection with the
Shareholders’ Meeting.		 No deviation

26

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
VII. Information disclosure
(I)
Does the company have a corporate website to
disclose both financial standings and the status of
corporate governance?
(II) Does the company have other information disclosure
channels (e.g. an English website, designated
personnel to handle information collection and
disclosure, a spokesman system, webcasting of
investor conferences)?
(III) Does the company have other information disclosure
channels (such as building an English website,
appointing designated personnel to handle
information collection and disclosure, creating a
spokesman system, webcasting investor
conferences)?

(I)
The Company has set up a website to disclose information about its
financial standings and the status of corporate governance.
Website: www.weltrend.com.tw
(II)
In addition to regularly or irregularly disclosing relevant financial
business information on the Market Observation Post System as required
by the competent authorities, the Company reveals relevant information
on its website. The Company has established an English website, and the
Financial Department is responsible for collecting and disclosing
corporate information. Additionally, the Company has spokesmen and
acting spokesmen, and the spokesman system is under good operation.
(III) In accordance with regulatory requirements, listed companies must file
their annual self-assessed financial information within 75 days after the
end of the fiscal year and publicly announce and file their annual
financial reports within three months after the fiscal year-end. Although
the Company did not announce its annual financial report within two
months after the year-end, it completed the announcement and filing
within the 75-day deadline. The Company’s financial reports for the first,
second, and third quarters of 2024, as well as monthly revenue figures,
were announced and filed on the Market Observation Post System
(MOPS) before the respective deadlines and were simultaneously
uploaded to the Company’s website.		 Regarding the
announcement and
filing of the annual
financial report
within two months
after the end of the
fiscal year, the
Company will
handle the matter in
a timely manner in
accordance with the
regulations of the
competent authority.
VIII. Is there any other important information to facilitate a
better understanding of the company’s corporate
governance practices (e.g., including but not limited
to employee rights, employee wellness, investor
relations, supplier relations, rights of stakeholders,
directors’ and supervisors’ training records, the
implementation of risk management policies and risk
evaluation measures,the implementation of client		 (I)
With the management philosophy of "innovation, quality, stability and
pragmatism", the Company has been constantly pursuing innovation and
breakthroughs in technology, and striving to achieving the corporate
vision of "a profitable company with significant influence on specific
product lines, interesting workplace, and humanistic spirit". Managers are
constantly working towards this goal and striving to achieve this vision so
that every employee can truly enjoy their work, earn a stable income and
maximize the benefits for shareholders.
No deviation

27

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
relations policies, and purchasing insurance for
directors and supervisors)?		 (II)
In terms of employees' rights and interests, the Company abides by the Labor
Standards Act and other relevant laws and formulate personnel management
rules to protect employees' rights and interests. Moreover, the Company
holds quarterly labor-management meetings for mutual communication. In
addition to general benefits such as labor and health group insurance for
employees of the Company, the Employee Benefit Committee has been
established to provide monthly funding for regular employee benefit
activities, formulate annual plans and budgets, prepare festival gifts, organize
group tourism, conduct community activities, hold birthday parties, donate
wedding and funeral gifts, offer lunch subsidies, etc.
(III) With respect to investor relations, the Company has spokesmen and
acting spokesmen who engage in investor relations, so that investors can
be fully informed of the Company's operations in real time and enjoy the
best services.
(IV) Suppliers are important partners of the Company's business operation.
The Company's main suppliers are world-class manufacturers of wafer
manufacturing and high-quality packaging factories, which have a
complete green supply chain system and are the benchmark and reliable
partners. Besides, they have passed TS16949 and ISO14000, and the
manufacturing services provided by them can ensure the quality of the
Company's products In line with client expectations and green quality
requirements, the Company and suppliers jointly pursue sustainable
business operations and growth through close cooperation, and actively
achieve goals for quality and service standards, green products, labor
management, and environmental safety and health management.
(V)
With respect to the rights of stakeholders, the Company has established a
stakeholder section on its external website to disclose the interaction,
operation, and contact information of stakeholders to establish a channel
of communication between employees, clients, investors and other
stakeholders and the Company, thus safeguarding the rights of
stakeholders.

28

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(VI) The training hours and course content of all directors and independent
directors in current year meet the requirements of the competent
authorities. For further details regarding the "Director's Training Status,"
please refer to page 36.
(VII) The Company has taken out liability insurance for the directors and
supervisors. The directors and supervisors of the Company comply with
the laws and act with prudence and integrity. In addition to the annual
renewal of liability insurance, the Board of Directors was informed of the
amount, coverage and premium rates of liability insurance for the current
year in Q2 2024. Please check the Market Observation Post System for
relevant information. The insurance situation for 2025 was also reported
to the Board of Directors in Q2 2025.
(VIII) For the succession planning of the Board members and key management
personnel, please refer to page 37.

29

Evaluation items Status of implementation Status of implementation Status of implementation Status of implementation Deviations from the
Corporate
Governance Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
IX. Based on the latest Corporate Governance Evaluation report released by the Corporate Governance Center of TWSE, please state the circumstances in which
improvements have been made and propose priorities and measures for those that have not yet improved.
Priorities and measures for improvement of the unscored items in the Company's corporategovernance evaluation for 2024:
Evaluation indicators
Priorities and measures
Does the Company establish Functional Committees, such as a Nomination
Committee, Risk Management Committee, or Sustainable Development
Committee, in addition to the statutory committees? These committees
should have no fewer than three members, with a majority of independent
directors, and at least one member should possess the necessary expertise
for the committee. Furthermore, does the Company disclose the
composition,responsibilities,and operational status of these committees?
The Company plans to establish a Sustainable Development Committee in 2025.
Does the Company have a Functional Committee at the Audit committee or
Board of Directors's level (e.g., Risk Management Committee) to oversee
risk management? Has the company established risk management policies
and procedures approved by the Board of Directors, and disclosed the risk
management organizational structure, procedures, and operations?
Additionally, does the committee report to the Board of Directors at least
once ayear?
The Company plans to have the Audit Committee oversee risk management starting
from 2025. It will establish risk management policies and procedures approved by
the Board of Directors, disclose the organizational structure, management
procedures, and operations, and report to the Board of Directors annually.
Does the Company prepare its Sustainability Report in accordance with the
GRI Standards published by the Global Reporting Initiative (GRI), and
upload the report to the Market Observation Post System and the
Company’s website?
The Company will prepare the 2024 Sustainability Report in accordance with the
GRI Standards and upload it to the Market Observation Post System and the
Company’s website by the end of August 2025.
Has the Sustainability Report prepared by the company been submitted to
and approved by the board of directors?
The Company’s 2025 Sustainability Report for 2024 will be submitted to the Board
of Directors for discussion and approval before being publicly announced.
Evaluation indicators Priorities and measures
Does the Company establish Functional Committees, such as a Nomination
Committee, Risk Management Committee, or Sustainable Development
Committee, in addition to the statutory committees? These committees
should have no fewer than three members, with a majority of independent
directors, and at least one member should possess the necessary expertise
for the committee. Furthermore, does the Company disclose the
composition,responsibilities,and operational status of these committees?		 The Company plans to establish a Sustainable Development Committee in 2025.
Does the Company have a Functional Committee at the Audit committee or
Board of Directors's level (e.g., Risk Management Committee) to oversee
risk management? Has the company established risk management policies
and procedures approved by the Board of Directors, and disclosed the risk
management organizational structure, procedures, and operations?
Additionally, does the committee report to the Board of Directors at least
once ayear?		 The Company plans to have the Audit Committee oversee risk management starting
from 2025. It will establish risk management policies and procedures approved by
the Board of Directors, disclose the organizational structure, management
procedures, and operations, and report to the Board of Directors annually.
Does the Company prepare its Sustainability Report in accordance with the
GRI Standards published by the Global Reporting Initiative (GRI), and
upload the report to the Market Observation Post System and the
Company’s website?		 The Company will prepare the 2024 Sustainability Report in accordance with the
GRI Standards and upload it to the Market Observation Post System and the
Company’s website by the end of August 2025.
Has the Sustainability Report prepared by the company been submitted to
and approved by the board of directors?		 The Company’s 2025 Sustainability Report for 2024 will be submitted to the Board
of Directors for discussion and approval before being publicly announced.

30

Standards for assessing the independence of CPAs

Evaluation items Assessment
outcome		 Compliance with
independence
criteria
Whether CPAs and their spouses and dependent relatives
have direct or indirect material financial relationship
with the Company		 No Yes
Whether CPAs and their spouses and dependent relatives
have any business relationship with the Company and its
directors or managers that may affect independence
Relationship		 No Yes
During the audit period, whether CPAs and their spouses
and dependent relatives served as directors, managers of
the Company or had direct and material influence on the
audit work		 No Yes
Whether CPAs and the Company’s directors or managers
are spouses, direct relatives, relatives in-law or relatives
within the second degree of kinship		 No Yes
Whether CPAs have received gifts or presents of great
value from the Company or from a director, manager or
substantial shareholder of the Company		 No Yes

Information on stakeholder interactions and business operations

Objects Major concerns Demands/expectations Communication channels and
frequencies		 2024 actual performance
Staff 1. Salary and
benefits
2. Talent
development
3. Operational
performance		 1. Provide good
salary and benefits
2. Platform for
expressing
opinions
3. Improve
professional
competence		 • Hold quarterly
labor-management
meetings, Benefit
Committee’s meetings, and
birthday celebrations.
• Internal website or internal
email announcements:
Important corporate
information, information
on the Benefit Committee,
information on various
legal compliance,
education and training
courses, performance
management operations,
quality management
system related operations
and legal updates,
information security
information, etc.
• Employee-only mailboxes,
sexual harassment
complaints,
whistle-blowing mailboxes
for fraud or violation of
professional ethics.
• Each department conducts
weekly/monthly/quarterly
work meetings or
professional educational
trainingas required.

1. In 2024, four
labor-management
meetings and birthday
celebrations were held on
March 28, June 26,
September 26, and
December 23, with four
event occurring each
quarter.
2. The Company published a
total of 77 pieces of
information on its intranet,
as well as monthly revenue
information and quarterly
information on information
security to all employees
by Email.
3. No employee complaints
or violations of labor laws.
4. A total of 1,343
person-times with 3,788.5
hours of educational
training were held
throughout the year.
5. The kick-off meeting for
the Sustainability Report,
along with professional
guidance and training,
were held on November
20, 2024.

31

Objects Major concerns Demands/expectations Communication channels and
frequencies		 2024 actual performance
Clients 1. Client services
2. Supply chain
management
3. Compliance
with laws and
regulations		 1. Provide products
and follow-up
services to meet
clients’
requirements for
quality		 • Regular communication
and discussion meetings.
• Irregular response to
questions.
• An annual client
satisfaction survey.		 1. The number of cases for
client needs and HSF cases
was 747, and 719 cases
were completed, with a
completion rate of 96.3%.
2. In 2024, actively
participated in various
ESG-related carbon
reduction project seminars
hosted by customers and
successfully completed
internal greenhouse gas
third-party inventory
operations, meeting
customer requirements.
Investors 1. Sustainable
development
strategy
2. Operational
performance
3. Risk
management		 1. Information
transparency
2. Compliance with
laws and
regulations
3. Corporate social
responsibility		 • Hold a Shareholders’
Meeting every year.
• Hold at least two investor
conferences a year and
publish brief reports on the
Market Observation Post
System and the Company's
external website.
• Regular publication of
financial statements
(monthly revenue,
quarterly and semi-Annual
Reports) on the Market
Observation Post System
and the company's external
website.
• Update the Company's
latest information on the
Company's external
website from time to time.
• Irregular participation in
seminars held by domestic
and overseas investment
institutions.
1. Hold the Shareholders’
Meeting on May 29, 2024.
2. Three public investor
conferences were held on
March 20, August 16, and
November 11, 2024
respectively.
3. Financial information is
regularly posted on the
company's website and
Market Observation Post
System.
4. The Company publishes
22 pieces of corporate
information on its external
website.
Suppliers 1. Sustainable
development
strategy
2. Operational
performance
3. Innovation
management		 1. Compliance with
quality
requirements
2. Compliance with
regulatory
requirements
3. Compliance with
supplier policies
4. Integrate the BOM
of homogeneous
products to reduce
HSF-related
control costs		 • Quarterly review report or
meeting.
• Fixed annual audit
procedures.
• Carry out environmental
safety and sustainable
development related
cooperation plan with
suppliers from time to
time.		 The Quality Assurance
Department carries out the
supplier audit (including
QSA/QPA/HSF) every year. A
total of 15 suppliers performed
audits this year.

32

Objects Major concerns Demands/expectations Communication channels and
frequencies		 2024 actual performance
Government
agencies
1. Occupational
safety and
health
2. Ecological
conservation
3. Environmental
management
4. Government
Regulation		 1. Jointly maintain the
work environment
2. Compliance with
laws and
regulations
3. Compliance with
HSF-related laws
and regulations
• Participate in the
functional organization
and operation of park and
Bureau of Science and
Management regularly.
• Actively participate in
public hearings of
regulations and seminars
held by competent
authorities.		 1. Participated in the joint
meeting of the Board of
Directors and Supervisors
of the Park Association
and related seminars for 3
times.
2. Participated in 20
government-related public
hearings, seminars and
information sessions.
3. Personnel were assigned to
participate in
integrity-related courses,
including the Ministry of
the Interior’s Second
Special Police Corps 2024
ESG Integrity Courses on
"Trade Secret Protection
and Anti-Fraud Advocacy,"
as well as a seminar hosted
by the Industrial
Association of the Science
Park featuring TSMC’s
public interest initiative
introducing the
―Sustainable Smart
Management Center for
Trade Secrets‖ and
promoting the
―Self-Evaluation Indicators
for Sustainable Smart
Management of Trade
Secrets.‖
4. Personnel were assigned to
participate in the basic
training of the Emergency
Response Team of
Weltrend Semiconductor,
Inc. at the Hsinchu Science
Park, as well as the 2024
Group B Enterprises’
Self-Managed Pollution
Prevention Promotion and
Briefing Session on Soil
and Groundwater Pollution
Prevention Management.
Participated in the 1st 2024
Hsinchu County Briefing
Session on Industrial
Waste Disposal Plans and
Related Regulations.
5. Personnel were assigned to
attend the 2024 Workplace
Equality and Sexual
Harassment Prevention
Workshop, the Ministry of
Labor’s 2024 Briefing
Session on Labor
(Employment) Insurance
and Occupational Accident

33

Objects Major concerns Demands/expectations Communication channels and
frequencies		 2024 actual performance
Insurance Regulations, and
the "Occupational Injury
Management and
Protection of
Labor-Employer Rights"
seminar organized by the
Occupational Safety and
Health Administration of
the Ministry of Labor.
Community
(school)
association		 1. Public welfare
2. Industry-acade
my cooperation		 1. Talent recruitment
2. Talent cultivation		 • Actively participate in
community activities or
seminars.
• Actively participate in
industry-academy
cooperation.
• Public welfare activities.		 1. Sponsored the Paper
Windmill 368 Township
Children’s Art Project
organized by the Paper
Windmill Arts and
Educational Foundation,
Taiwan The Weltrend's
charity donation fund is
utilized to support public
welfare projects, including
the 368 Township
Children’s Art Project in
the East District of
Hsinchu City.
2. Sponsored the Golden
Root Award Entrepreneurs
Networking Event
organized by the Taiwan
Industrial Technology
Association to strengthen
collaboration with various
industries.
3. Sponsored the 2024 World
Music Festival @ Taiwan,
which brought together 16
outstanding performing
groups from Taiwan and
abroad and welcomed 15
international delegations.
The Company provided
tickets for employees to
attend the event, allowing
them to enjoy music from
around the world and
experience the cultural
fusion of diverse musical
expressions.
Media 1. Operational
performance
2. Corporate
Governance
3. Sustainable
development
strategy		 1. Company product
release
2. Major topics		 • Publish press
releases/material
information on the Market
Observation Post System
and the Company's
external website.
• Hold at least two investor
conferences a year and
publish brief reports on the
Market Observation Post
System and the Company's
external website.		 1. The Company publishes
22 pieces of corporate
information on its external
website.
2. This year, 22 pieces of
Chinese and English
information were posted
on the Market Observation
Post System.
3. Three public investor
conferences were held on
March 20, August 16, and
November 11, 2024
respectively.

34

Objects Major concerns Demands/expectations Communication channels and
frequencies		 2024 actual performance
Cooperation
partners
1. Sustainable
development
strategy
2. Risk
management
3. Client services		 1. Compliance with
laws and
regulations
2. Compliance with
client requirements		 • Discuss at irregular
meetings according to
client requirements.
• The relevant product
information and technical
support on the Company’s
website is updated from
time to time.		 1. Conducted ISO9001
regular external audit from
July 31 to August 1, 2024,
and passed without any
defects.
2. Conducted QC080000
regular external audit from
July 31 to August 1, 2024,
and passed without any
defects.
3. Completed the
self-assessment of ISO
14064 by the end of June
2024.
4. Held the kick-off meeting
for the Sustainability
Report and initiated related
guidance and training
programs in November
2024.
5. Underwent an external
audit for ISO 14001 on
December 5, 2024, and
passed with no
nonconformities.

35

Continuing Education of Directors and Key Managerial Personnel

Title Name Period of
Training		 Organizer Course Hours
Chairman Sam Lin 2024.7.20 Commerce Development
Research Institute		 Corporate Governance and Sustainable
Business Operation Workshop		 3
2024.9.6 Commerce Development
Research Institute		 Corporate Governance and Sustainable
Business Operation Workshop		 3
2024.9.30 Taiwan Stock Exchange Summit of Empowering Taiwan Capital
Market		 3
Director James Chou 2024.8.20 Taiwan Corporate
Governance Association		 How to reposition and respond in the Era of
Carbon Pricing		 3
2024.9.24 Taiwan Corporate
Governance Association		 AI Application, Legal Issues and Auditing 3
Director Paul Liao 2024.7.17 Taiwan Independent
Director Association		 Recent Developments in AML/CTF 3
2024.7.31 Taiwan Corporate
Governance Association		 Creation of a Friendly Workplace under the
Labor Standards Act – Introduction to the
Latest Gender Equality Regulations and Case
Studies of Unlawful Infringements		 3
Director Jeff Tsai 2024.9.5 Securities and Futures
Institute		 Operational Outlook for the Second Half of
2024—Latest Taiwan Industrial Managers
(PMI/NMI) Current Situation, Strategies and
Challenges		 3
2024.10.4 Securities and Futures
Institute		 2024 Insider Trading Prevention Seminar 3
Director,
Vice President,
Chief Financial
Officer, and
Corporate
Governance
Officer		 Cindy Guo 2024.6.21 Taiwan Corporate
Governance Association		 Legal Regulations for Sustainability Reports 3
2024.6.26 Accounting Research and
Development Foundation		 The Latest Regulations on "Annual
Report/Sustainability Information/Financial
Report Compilation" and Practice of Internal
Control Management		 6
2024.8.2 Taiwan Corporate
Governance Association		 Corporate Governance Supervisor
Compliance Work Practice		 3
Director and
Chief R&D
Officer		 JC Liu 2024.10.4 Securities and Futures
Institute		 2024 Insider Trading Prevention Seminar 3
2024.10.15 The Allied Association for
Science Park Industries		 Financial Statement Interpretation Ability and
Case Analysis		 3
Director and CEO Tony Lin 2024.10.15 The Allied Association for
Science Park Industries		 Financial Statement Interpretation Ability and
Case Analysis		 3
2024.11.12 Taiwan Academy of
Bankingand Finance		 Legal Risks of Mergers and Acquisitions 3
Independent
Director		 Gerald Kuo 2024.6.25 Taiwan Corporate
Governance Association		 How to Proactively Take on the Challenges
and Opportunities along the Path to Upgrade
and Transformation for Taiwanese
Enterprises in the Post-Pandemic Era(Part I)		 3
2024.6.28 Taiwan Corporate
Governance Association		 How to Proactively Take on the Challenges
and Opportunities along the Path to Upgrade
and Transformation for Taiwanese
Enterprises in the Post-Pandemic Era(Part II)		 3
2024.7.9 Taipei Exchange AI Strategy and Governance 3
Independent
Director		 Wei-Kun
Yeh		 2024.9.11 Securities and Futures
Institute		 Sustainable Development Strategies and
Plans for Listed Companies		 3
2024.10.4 Securities and Futures
Institute		 2024 Insider Trading Prevention Seminar 3
Independent
Director		 Wen-Tsung
Hsu		 2024.6.21 Securities and Futures
Institute		 Shareholders' Meeting, Management Right
and EquityStrategy		 3
2024.7.26 Securities and Futures
Institute		 Opportunities and Challenges for Taiwan's
Industrial Transformation under Geopolitics -
PMI/NMI Exclusive Analysis		 3

36

Succession Planning for Board Members and Key Management Personnel

I. Succession Planning and Operations for Board Members

The Company’s directors are elected at the shareholders’ meeting in accordance with the Company’s "Articles of Incorporation" and the ―Board Member Election Rules,‖ using a candidate nomination system. Candidates for the next board term are nominated by the Board of Directors or shareholders holding more than 1% of the Company’s shares. Nominations are based on the Company’s operational needs, future development strategy, candidates’ professional expertise, and the board diversity policy. Suitable candidates may be selected from among current directors, senior executives, or external professionals to form the most optimal board structure and composition.

The structure of the Company’s Board of Directors is determined by considering the scale of the Company’s business development, respecting the shareholding ratio of major shareholders, and bringing in independent directors who can contribute to the Company. Decisions on board changes are not based on personal preferences, but rather on practical operational needs.

To implement the board diversity policy, strengthen corporate governance, and promote the sound development of the Board's composition and structure, the Company has established a diversity policy for board members in its "Corporate Governance Best Practice Principles." This policy is designed based on the Company's operations, business model, and development needs. In addition to emphasizing diversity in basic conditions such as gender, age, and values, it also includes professional backgrounds (e.g., accounting, industry, finance, marketing, technology, law), as well as diverse professional knowledge and skills, including industry experience. To enhance corporate governance and improve the Board's effectiveness, the Company conducts an internal board performance evaluation at least once a year, in accordance with its "Rules for Performance Evaluations of the Board of Directors." This performance evaluation mechanism ensures the effectiveness of the board's operations and the results of the evaluation are used as a reference for future board member nominations and reappointments.

Regarding Board's succession planning, the Company arranges for key senior management members to join the board, allowing them to become familiar with and grasp the Board's operations and the operational status of various divisions within the Group.

II. Succession Planning and Operations for Key Management

The Company has always adhered to the business philosophy of honesty, integrity, transparency and selflessness, so it pays special attention to these personality traits when cultivating successors. Additionally, due to the fierce competition and rapid change of high-tech industry, the Company attaches great importance to young employees with professional abilities. Currently, the Company places potential successors in the position of senior executives to receive training, gain extensive exposure and take charge of specific operations.

Potential successors are trained in comprehensive business and management capabilities by participating in key management meetings, management function courses, and other training programs. In alignment with the Company’s operational management challenges at various stages, potential successors undergo progressive training to ensure smooth transitions in key management positions. This ensures the achievement of the Company’s operational goals at each stage and fulfills its corporate social responsibility for sustainable operations.

37

  • (IV) If the Company has the Remuneration committee, it shall disclose its composition, duties and operation:

  • (1) Information on members of the Remuneration Committee

==> picture [484 x 158] intentionally omitted <==

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

Number of other public
Professional companies in which the
Criteria Status of
Title Name qualifications and experience independence serves as a member of the individual concurrently
Remuneration Committee
Independent Gerald Kuo Please refer to page 6-7 of the Annual Report
Director for information on professional qualifications 1
(Convener) of directors and independence of independent
Independent Wei-Kun Yeh directors.
0
Director
Independent Wen-Tsung Hsu
1
Director
----- End of picture text -----

  • (2) Information on the operation of the Remuneration Committee

  • I. The Remuneration Committee has three members.

  • II. Term of office: July 4, 2022 to June 22, 2025. The Remuneration Committee held 5 meetings (A) in the most recent year. The attendance is as follows:

Title Name Attendance
in person (B)		 Proxy
attendances
Attendance rate
(B/A)		 Note
Convener Gerald Kuo 5 - 100% Serve for another
term of office
Committee
Member		 Wei-Kun Yeh 5 - 100% Serve for another
term of office
Committee
Member		 Wen-Tsung Hsu 5 - 100% Newly-appointed
Other matters:
I.
In the case that the Board of Directors modifies or declines to adopt a recommendation of the
Remuneration Committee, it shall specify the date of the meeting, session, content of motions,
resolution by the Board of Directors, and the Company’s response to the Remuneration
Committee’s opinions (e.g., the remuneration passed by the Board of Directors is higher than
that recommended by the Remuneration Committee, the circumstances and cause for the
difference shall be specified): N/A.
II.
Where there is any resolution of the Remuneration Committee to which a member objects or
on which a member has a qualified opinion, and such objection or qualified opinion is
documented or reduced to a written statement, it is required to disclose the meeting date,
session,content of motions,opinions of all members and the response thereto: N/A.

38

III. Reasons for discussion and results of decisions of the Remuneration Committee, and the Company's handling of members' comments

Compensation
Committee		 Content of the motion and subsequent
handling		 Resolutions The Company’s actions
in response to opinions
from the Remuneration
Committee
2024.2.26
The 5th The 6th
1. Reviewed the Year-end Bonus Plan
for the Company's managers for
2023.
2. Reviewed the proposal of the
Company's compensation to
employees and remuneration to
directors and supervisors for 2023.		 Approved by all
members of the
Remuneration
Committee.		 All motions were
unanimously approved by
the directors present
without any objection to
the recommendation of
the Remuneration
Committee.
2024.5.8
The 5th The 7th
1. Review of the proposal for
distribution of Directors’
remuneration for 2023.		 Approved by all
members of the
Remuneration
Committee.		 All motions were
unanimously approved by
the directors present
without any objection to
the recommendation of
the Remuneration
Committee.
2024.8.7
The 5th The 8th
1. Reviewed the Remuneration
Allocation Plan for the Company's
managers and employees for 2023.
2. Reviewed the proposal for the
compensation adjustment of
managers for 2024.		 Approved by all
members of the
Remuneration
Committee.		 All motions were
unanimously approved by
the directors present
without any objection to
the recommendation of
the Remuneration
Committee.
2024.8.23
The 5th The 9th
1. Reviewed the proposed transfer of
the Company's treasury shares to
employees with manager status.		 Approved by all
members of the
Remuneration
Committee.		 All motions were
unanimously approved by
the directors present
without any objection to
the recommendation of
the Remuneration
Committee.
2024.11.6
The 5th The
10th		 1. Reviewed the Remuneration
Allocation Plan for the Company's
managers and employees for 2023.		 Approved by all
members of the
Remuneration
Committee.		 All motions were
unanimously approved by
the directors present
without any objection to
the recommendation of
the Remuneration
Committee.

The function of the Remuneration Committee is to evaluate the remuneration policies and systems of the directors, supervisors and managers of the Company in a professional and objective manner. The Remuneration Committee shall hold at least 2 meetings a year and make recommendations to the Board of Directors for their decision making. It shall regularly review the Organizational Regulations of the Remuneration Committee, put forward suggestions for amendments, formulate and regularly review the performance evaluation standards, annual and long-term performance goals, and salary and compensation policies, systems, standards and structures for directors, supervisors and managers of the Company.

39

(V) Implementation of sustainable development, deviations from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, and the reasons therefore:

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
I.
Has the Company established a
governance structure to achieve
sustainable development, and set up a
dedicated (part-time) unit to promote
sustainable development, which is
authorized by the Board of Directors
to handle senior management, and
supervised by the Board of Directors?
The Company has established an ESG Sustainable Development Team, chaired by the CEO.
The Team is structured around six key aspects of sustainable development and comprises
cross-departmental members responsible for planning and implementing relevant initiatives.
The ESG Sustainable Development Team reports the progress and implementation status of
the previous year’s sustainability efforts to the Board of Directors in the first quarter of each
year. The working group prepares a sustainable development promotion plan at the
beginning of the year and reports the contents of the plan to the supervisor. With the
approval of the supervisor, the promotion unit explains the plan contents and communicates
the promotion methods to the relevant departments, and reports to the supervisor regularly
and reviews the effectiveness of the operation. The responsibilities of the working group
include formulating and reviewing sustainable development policies, systems or related
management guidelines, collecting stakeholders' views and responding appropriately to
their concerns, reporting annually to the Board of Directors on the promotion and
implementation of sustainable development, and communicating with stakeholders. In
addition to reviewing the implementation of the strategy and goal setting, the Board of
Directors reviews the implementation of the measures and makes recommendations and
improvementplans to the management team if necessary.


No deviation
II.
Has the Company conducted risk
assessments on environmental, social
and corporate governance issues
related to corporate operations
according to the principle of
materiality, and formulated relevant
risk management policies or
strategies?		 1.
This disclosure covers the Company’s sustainable development performance at its
primary locations from January to December 2024. The boundary of material topics
primarily includes Weltrend Semiconductor, Inc. and its Kaohsiung branch in Taiwan.
2.
The Company’s Sustainable Development Team conducts an analysis based on the
materiality principle of the sustainability report. It engages with internal and external
stakeholders and reviews domestic and international research reports and literature.
The Team integrates evaluations from various departments and subsidiaries to assess
material sustainability topics. Based on this, it formulates risk management policies
for effective identification, measurement, assessment, monitoring, and control, and
implements concrete actionplans to mitigate the impact of related risks. For details on		 No deviation

40

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
the material topic risk management strategies and performance for 2024, please refer
topages 59-61.
III. Environmental issues
(I)
Has the Company established proper
environmental management systems
based on the characteristics of their
industries?		 The Company is engaged in product R&D, design and sales. The wafer and IC packaging
developed by the Company are all produced by relevant cooperative suppliers. Supplier
management and hazardous substance control are performed in accordance with the
Company's Supplier Management Regulations and HSF Management Procedures. The
Company has been certified by ISO 14001 Environmental Management System and IECQ
QC 080000 Hazardous Substance Process Management. The Company conducts annual
certification audit by the accredited firm and has obtained validity certificate for
certification system. Our commitments and practices are as follows:
(I)
Product R&D, design, manufacturing and sales:
1.
All products comply with the following international regulations:
(1) EU RoHS.
(2) Halogen Free.
(3) PFOS and PFOA control.
(4) EU REACH SVHC.
2.
Our products are tested by a third-party accredited firm (a laboratory accredited
by ISO 17025) to monitor and manage suppliers' materials to meet the
regulations for the management of hazardous substances.
3.
Constantly promote and hold educational training to make all employees fully
understand the meaning and responsibility of eliminating harmful substances.
4.
Establish a qualified supplier system to ensure that materials do not contain
hazardous substances.
(II) Supplier management:
1.
The supplier shall comply with the Company's Supplier Management
Regulations and HSF Management Procedures, and ensure that it conforms to
the Company's definition of green products.
2.
The third-party accredited firm (a laboratory accredited by ISO 17025) shall
provide regular test reports on the use of materials.
3.
Review the material safetydata report of raw materials.		 No deviation

41

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(II) Has the Company endeavored to
utilize all resources more efficiently
and used renewable materials which
have low impact on the environment?		 Environmental protection is a pivotal part of sustainable development. The Company is
committed to improving energy efficiency and using recycled materials with low impact on
the environment, and incorporating the concept of environmental protection into operating
procedures to reduce environmentally harmful substances and materials, relieve the burden
and impact on the environment, and enable the sustainable use of global resources. The
specific measures are as follows:
1.
Reduce the discharge of pollutants, toxic substances and waste, and dispose of waste
properly.
2.
Improve the recyclability and reuse of products.
3.
Prolong the shelf life and durability of products.
4.
Improve product efficiency.
5.
Promote e-form sign-off system to save paper consumption.
6.
Recycle packaging cushioning materials (such as foam, bubble cloth) for shipping
operations to reduce the use of plastic products.
7.
Recycle IC tubes and trays for the loading of defective products to increase the
recycling rate of plastic products.
8.
Implement resource classification and recycling, reduce the use of single-use
appliances such as paper cups and disposable cutlery to alleviate the burden and
impact on the environment.		 No deviation
(III) Has the Company assessed the
potential risks and opportunities of
climate change on its present and
future operation, and taken measures
to respond to climate-related issues?		 (I)
Substantial risks arising from climate changes:
The Company is engaged in IC design industry and has no wafer fabs. In case of risks
caused by climate changes, apart from the cost increase due to the increase of
electricity and water demand for air conditioning and office lighting, the extreme
climate triggered by global warming may increase the frequency and severity of
natural disasters. As a result, it may lead to power failure and water outage due to
disasters, which may indirectly increase the operating costs of the Company.
Additionally, clients and other stakeholders may require that the products and services
provided by the Company meet requirements related to energy conservation, low
pollution, no use of prohibited substances and raw materials, or ask the Company to
obtain carbon and water footprint verification.		 No deviation

42

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(II) Business exposure to climate change-related regulations:
The Company is not one of the enterprises included in "the first batch of emission
sources that shall be inventoried to register greenhouse gas emissions" as announced
in the Greenhouse Gas Reduction and Management Act, and has no risk of violating
the regulations. However, to realize the goal of Net-Zero by 2050 set by the
government, the Company will follow the greenhouse gas inventory and verification
schedule of TWSE/GTSM listed companies stipulated by the government and the
carbon reduction plan of the government, and gradually promote the relevant
greenhouse gas inventory and carbon reduction plan of the Company to achieve the
goal of sustainable development.
(III) The sustainable development plan for ESG is as follows:
1.
2022:
(1) Greenhouse gas inventory: In the initial stage, only Category 1 (direct
greenhouse gas emission sources, such as refrigerant) and Category 2
(indirect greenhouse gas emission sources, such as purchased electricity) of
the Company (including subsidiaries) will be investigated. The Company
has conducted the inventory and calculation of greenhouse gas emissions in
2021 and established a database with 2016 as the base year to reduce
carbon emissions by 3% as the target. Reasonable carbon reduction target
shall be based on business turnover. Therefore, the Company will examine
the sources of greenhouse gas emissions in Categories 1 and 2 in 2022 as
the basis for setting the carbon reduction target.
(2) Carbon footprint inventory: This part is for product inventory. All suppliers
shall be included in the inventory. The carbon footprint inventory plan has
been formulated and announced to the suppliers to assist in the investigation.
(3) Collect CSR and ESG reports by suppliers.
(4) Results: The Company initialed the training on the ISO 14001
Environmental Management System in 2022, completed the audit review
by the accredited firm in December 2022, and obtained the ISO 14001
certification in March 2023.

43

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
2.
2023:
(1) Adjust the base year and redefine the carbon reduction target. (2022 will
takes 2016 as the base year)
(2) Category 3 (other indirect greenhouse gas emission sources, e.g. employee
commuting, transportation) shall be included in the inventory to facilitate
the Company's data collection of greenhouse gas emissions.
(3) Supplier carbon footprint inventory: The size of the supplier determines the
difficulty of carbon footprint inventory. At the present stage (2022-2025),
the Company will discuss with the supplier on how to collect relevant data.
(4) Complete the training on ISO14064-1 greenhouse gas inventory, and obtain
thegreenhousegas emission inspection statement bythe accredited firm.
(IV) Has the Company conducted
assessment on greenhouse gas, water
consumption and waste for the last
two years, and established strategies
for energy conservation and carbon
reduction, greenhouse gas reduction,
water saving and waste management?		 (I)
However, to realize the goal of Net-Zero by 2050 set by the government, the
Company will follow the greenhouse gas inventory and verification schedule of
TWSE/GTSM listed companies stipulated by the government and the carbon
reduction plan of the government, and gradually promote the relevant greenhouse gas
inventory and carbon reduction plan of the Company to achieve the goal of
sustainable development. Given the growth of the operating performance and the
increase in the proportion of electricity consumption, the Company takes 2022 as the
base year and aims to achieve the target of 3% carbon reduction for revenue per unit
(NT$ thousand) in 2026.
(II) Greenhouse gas emissions and reduction measures
The Company is not one of the enterprises included in "the first batch of emission
sources that shall be inventoried to register greenhouse gas emissions" as announced
in the Greenhouse Gas Reduction and Management Act. However, to realize the goal
of Net-Zero by 2050 set by the government, the Company will follow the greenhouse
gas inventory and verification schedule of TWSE/GTSM listed companies stipulated
by the government and the carbon reduction plan of the government, and gradually
promote the relevant greenhouse gas inventory and carbon reduction plan of the
Company to achieve the goal of sustainable development.		 No deviation

44

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
The Company completed ISO 14064-1 GHG inventory guidance in 2023 and underwent
third-party verification, successfully obtaining the verification statement for its 2022
GHG emissions. Currently, the base year for GHG inventory and verification is 2022. In
accordance with the ISO 14064-1 standard, the Company conducted a GHG emissions
inventory through self-assessment (including both the headquarters and subsidiaries).
The results indicate that the primary source of GHG emissions in 2023 was electricity
consumption (Scope 2), which accounted for approximately 1,441 metric tons of CO₂
equivalent. The second major source, though comparatively minor, consisted of direct
emissions (Scope 1) from air conditioners, fire extinguishers, and water dispenser
refrigerants, totaling around 55 metric tons of CO₂ equivalent. The combined
emissions amounted to approximately 1,496 metric tons of CO₂ equivalent. Overall,
electricity consumption (Scope 2) accounts for about 96.32% of total emissions; Only
3.68% of the gas directly emitted from fixed equipment such as air conditioners, fire
fightingdevices and water dispensers(Scope 1).
Scope Corresponding Activities/Facilities Source of
Emission		 Types of GHG 2022 2023
Unit: t-C O2e/Year
Scope 1, direct
GHG emissions		 Fugitive emission
sources (F)		 Refrigerants from air conditioning in
companyvehicles		 Refrigerant HFCS 51.9452
(3.58%)		 55.0629
(3.68%)
Refrigerants used in water dispensers
Air conditioning(coolingmachine)
Chiller units

Refrigerators and freezers
Thermal shock test chambers
Constant temperature and humidity test
chambers
Air dryers
Fire extinguisher Refrigerant HFCS, CO2
Septic tank Wastewater CH4
Mobile emission
sources(T)		 Company vehicles Gasoline CO2, CH4、N2O
Scope 2, indirect 1,400.477 1,440.7278
GHG emissions - Purchased electricity Electricity CO2 (96.42%) (96.32%)
Total 1,452.4222 1,495.7907

45

Action item Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
111 年總排放量佔比 Proportion of total emissions in 2022
範疇一、直接溫室氣體排放3.58% Scope 1, direct GHG emissions 3.58%
範疇二、間接溫室氣體排放96.42% Scope 2, indirect GHG emissions 96.42%
112 年總排放量佔比 Proportion of total emissions in 2023
範疇一、直接溫室氣體排放3.68% Scope 1, direct GHG emissions 3.68%
範疇二、間接溫室氣體排放96.32% Scope 2, indirect GHG emissions 96.32%

46

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
Unit 2022 2023 Difference
Greenhouse gas emissions
(Scope 1)		 t-CO2e/year 51.9452
55.0629
6.00%
Greenhouse gas emissions
(Scope 2)		 t-CO2e/year 1,400.4770 1,440.7278
2.87%
Greenhouse gas emissions
intensity		 (Metric tons CO2e/NT$ million) 0.5029
0.5184
3.08%
Note: Greenhouse gas inventory for the year 2024 is in progress.
(III)
(IV)		 Water resource management information
All water used by the Company is municipal water (covering both headquarters and
branch office locations). In 2023 and 2022, the total annual indirect greenhouse gas
emissions generated from water consumption were approximately 1.8064 metric tons
and 1.7179 metric tons of CO₂ equivalent, respectively, representing a 5.15%
increase year-over-year. However, emissions from water consumption accounted for
only 0.125% of the Company's total indirect emissions, and therefore, water resource
emissions are not considered a material issue for the Company. The Company’s total
water consumption in 2023 and 2022 was 8,469 cubic meters and 6,912 cubic meters,
respectively, reflecting a 22.53% increase. The increase was primarily due to the
replacement of the chilled water system and expansion of the cooling tower in the
testing facility. The Company will continue to promote water conservation and
responsible usage of municipal water resources.
Unit
2022
2023
Difference
Tap water consumption
(metric tons)
m3
6,912.3724
8,469.5037
22.53%
GHG emissions from
water consumption
t-CO2e/year
1.7179
1.8064
5.15%
Water use intensity
(Metric tons CO2e/NT$ million)
2.3934
2.9351
22.64%
Waste management over thepast twoyears: The Company's waste management
Unit 2022 2023 Difference
Tap water consumption
(metric tons)
m3		 6,912.3724
8,469.5037
22.53%
GHG emissions from
water consumption		 t-CO2e/year 1.7179
1.8064
5.15%
Water use intensity (Metric tons CO2e/NT$ million) 2.3934
2.9351
22.64%
Waste management over thepast twoyears: The

47

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
efforts are primarily centered around the Hsinchu site. We continue to implement
waste reduction and recycling programs to minimize environmental impact.
In 2023, a total of 17.4371 metric tons of waste was generated, of which hazardous
waste accounted for only 0.998 metric tons. All hazardous waste was fully recycled,
achieving a 100% recycling rate, a significant improvement from the previous year
when no hazardous waste was recycled. The Company will continue to advance its
waste recycling initiatives.
The Company waste includes hazardous industrial waste (such as discarded ICs) and
general industrial waste (including plastics and paper). In 2023 and 2022, the amounts
of hazardous industrial waste (discarded ICs) disposed were 0.998 metric tons and 0
metric tons, respectively. General industrial waste (plastics and paper) amounted to
16.44 metric tons in 2023 and 15.12 metric tons in 2022. Greenhouse gas emissions
from waste accounted for only 1.1% of the Company's total Scope 2 emissions and are
thus not classified as a material topic. However, all commissioned waste disposal
operators are authorized by the competent authority for the removal and treatment of
such waste, and the Company has not violated any legal or regulatory requirements in
this regard. In addition, the Company successfully obtained ISO 14001 certification in
2023, underscoring our commitment to environmental management.
Waste category
Unit
Disposal methods
2022
2023
General
ton Incineration(Note 1)
15.1238
16.4391
Hazardous
tonIncineration(Note 2)
0.21
-
Recyclingand reuse(Note 3)
-
0.998
General + Hazardous ton Total ofgeneral + hazardous
15.3338
17.4371
-
-
Waste conversion rate(Note 4)
0%
6%
(Note 1:) General waste is calculated based on all company locations (including Taipei,
Taichung, Kaohsiung, and branch offices).
(Note 2:) Hazardous - Incineration: Refers to mixed plastic waste.
(Note 3:) Hazardous - Reuse and Recycling: Refers to discarded electronic components,

48

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
scraps, and defective products.
(Note 4:) Waste conversion rate = (Reuse + reduction + recycling + recovery +
waste-to-energy + anaerobic digestion + biofuel + composting)/Total waste
generated.
In 2023 and 2022, the revenue from waste recycling amounted to NT$127,801 and
NT$196,409, respectively. The recycling revenue decreased by NT$68,608
year-over-year, primarilydue to a reduction in the volume of recyclable waste.
Categories of waste resources
recycling/Year
Amount(NT$)
2022
2023
Offcuts
-
20,565
Plastics(includingTray)
192,000
102,856
Paper
4,399
4,250
Miscellaneous
10
130
Total
196,409
127,801
Note: Miscellaneous category includes light bulbs, batteries, etc.
(V) The Company's strategies for addressing climate change or greenhouse gas
management:
We understand that corporate operations, including product development, client
services and business activities, may affect the entire environment. To alleviate the
impact on the environment, we have established a qualified supplier system to ensure
that materials do not contain harmful substances, so as to form a green supply chain
with suppliers. We are also committed to energy conservation, major waste recycling,
hazardous material management, pollution prevention, energy and water conservation
and waste management. Additionally, we educate our staff on the importance of
implementing green product plans and enhance their awareness of the sustainable
corporate development.

49

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
Specific measures include: Air conditioning temperature control and energy efficiency
control in summer, timely turn off lighting equipment in unmanned areas, replace
lamps in the factory with LED T5 tubes, establish an electronic system to reduce
paper usage, build video equipment in each office for staff communication, make
good use of remote meetings, reduce the carbon emissions caused by business trips,
replace part of air conditioners with frequency-conversion air conditioners in each
office to achieve energy saving, check water equipment regularly, repair damaged
equipment in a timely manner, encourage colleagues to report to the Company at any
time for repair, constantly promote energy saving, water saving, car sharing and the
use of public transportation system, remind colleagues to cultivate the habit of saving
energy, perform supplier management, and require the manufacturing process and
finished product IC provided by the supplier to conform to the green products defined
bythe Company.
IV. Social issues
(I)
Has the Company formulated
appropriate management policies and
procedures according to relevant
regulations and the International Bill
of Human Rights?		 I.
Respect for human rights and labor rights:
(I)
Bills of human rights
1.
The Company provides fair opportunities for recruitment, appointment and
career development without discrimination on the basis of gender, race, age, or
other factors. We follow the spirit of the Universal Declaration of Human Rights,
the United Nations Global Compact, the ILO Declaration on Fundamental
Principles and Rights at Work and other important human rights conventions,
and internationally recognized human rights standards, and treat our employees,
contract staff and interns fairly.
2.
The Company adheres to the universally recognized principles of fundamental
labor rights, including freedom of association, the right to collective bargaining,
the prohibition of child labor, the elimination of various forced labor, the
elimination of discrimination in employment, and harm to workers.
3.
The Company prohibits discrimination on any human rights, including race,
color, age, gender, sexual orientation, ethnicity, physical or mental disability,
religion, political identity, organizational status, place of birth and marital status.
(II) Administration of human rights:
No deviation

50

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
To make all employees know that the Company is committed to human rights, the
Code of Ethics for Employees and Work Rules formulated by the Company clearly
stipulate that the Company provides fair opportunities for recruitment, appointment
and career development without discrimination on the basis of gender, race, age, or
other factors. The Work Rules stipulate that the employment of child labor is
prohibited, any type of discrimination or harassment (including sexual harassment) or
threatening language is prohibited within the workplace, and the interaction between
colleagues shall be based on the rationalprinciple of mutual respect.
(III) Communication channels for the implementation of human rights:
1.
Publicity of legal compliance: The Company conducts quarterly publicity of
legal compliance through intranet or announcements, and carries out
anti-discrimination, anti-sexual harassment, anti-bullying and other education
and training to create a high-quality workplace environment that safeguards
human rights.
2.
Employee mailbox and whistle-blowing system: The Articles of Association of
the Company specify the rights and interests of employees and set up THE
employee mailbox, so that each employee has direct access to express opinions
(or complaints) to the senior management. We also require suppliers to uphold
the above principles to treat their employees with the same standards. The
external website also has a whistle-blowing system for violations of professional
ethics.
3.
Labor-management meetings: The Company has established a good
communication channel and holds quarterly labor-management meetings to
ensure the rights and interests of both parties.
4.
Human rights and labor-related education and training:
Item
Course
1
2024 Workplace Equalityand Sexual Harassment Prevention Workshop
2
2024 Labor Retirement System and Regulations Seminar
3
Labor Insurance-Related Course – 2024 Ministry of Labor Employment Insurance
and Occupational Accident Insurance RegulatorySeminar

51

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
4 2024 Ministryof Labor - Labor Standards Act Seminar
5 Workplace Sexual Harassment Prevention TrainingCourse
6 Anti-Employment Discrimination and Promotion of Gender EqualitySeminar
7 Practical Training on Occupational Accident Management and Protection of
Labor-Employer Rights
8 Labor Law Training (II) – Labor Occupational Accident Insurance and Protection
Act
9 2024 Hsinchu Science Park Employee Welfare Business Seminar
10 Corporate and SupplyChain Human Rights Practices Workshop
11 Human Rights Compliance Education for New Employees
12 Quarterly Internal Web-Based ―Human Rights and Labor Rights Advocacy‖
Campaigns (Conducted on 2/21, 5/6, 8/12, and 11/13, 2024, with 100%
participation rate)
13 2024 Soil and Groundwater Pollution Prevention Management Seminar for
B-CategoryEnterprises
14 Fire SafetyManager Refresher Training
15 FactoryFire Risk Identification and Disaster Prevention and Response Training
16 On-the-Job First Aid Personnel Training
17 On-the-Job Occupational Safetyand Health Training
18 Hsinchu Science Park Weltrend Semiconductor Inc. Emergency Response Team
Basic Training
19 CategoryA Occupational Safetyand Health Supervisor Refresher Training
A total of 359 participants attended the above-mentioned courses, with a cumulative
trainingduration of 217.5 hours.
5.

52

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(II) Has the Company formulated and
implemented reasonable measures for
employee benefits (including
remuneration, vacation and other
benefits, etc.), and appropriately
reflected operating performance or
results in employee compensation?		 (I)
The Company has formulated and implemented reasonable employee benefits. In
terms of salary, we attach great importance to the treatment and benefits of employees.
The salary of employees is determined according to their professional ability, personal
performance, academic experience and background, as well as the company's
operating performance and future risks. We implement the concept of gender equality
in the workplace, and the salary of staff at all levels does not differ due to gender
Although the Company is engaged in the electronics, it is committed to diversity and
equality in the workplace. Currently, females account for about 32% of the employees
and 11% of the senior executives.
(II) With respect to employee remuneration, it is paid according to the Company's annual
operation and employee performance. It is stipulated in Article 20 of the Articles of
Association that the Company shall allocate 11% to 15% of the Company's pre-tax
profit of the current period before deducting the employees' remuneration and
Directors' remuneration of the year as employees' remuneration and no more than 4%
as Directors' remuneration. However, if the Company has accumulated losses
(including adjustment on non-distributed earnings), the Company shall set aside a part
of the profit first to make up for the losses. In terms of leave, special leave, sick leave,
maternity leave, leave without pay, etc. are granted in accordance with the provisions
of Labor Standards Act. For other benefits, please refer to page 108 of this Annual
Report.
No deviation
(III) Has the Company provided a healthy
and safe working environment and
organized training on health and
safety for its employees on a regular
basis?		 (I)
The Company is committed to providing a safe and healthy working environment for
employees. In terms of employee health, regular health lectures are held and health
education information is provided, so that employees can know their health status and
acquire the knowledge and methods of health management. The Company has also built
a fitness center for employees to offer a variety of sports and fitness equipment them to
use, so that employees have leisure and fitness space in their spare time. Regarding the
safe workplace, courses on fire safety training and work safety are held regularly to
cultivate staff's ability to respond to disasters and maintain environmental safety. The
safety of employees in the workplace is one of our most important responsibilities. In
2024, the number of occupational accidents of our employees was 0.
(II) Toprovide a healthyand safeworkingenvironment for all employees andprotect the		 No deviation

53

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
Company's assets, the implementation of environmental health and safety is as follows:
1.
Provide education and training to enhance staff’s awareness of environmental
safety and the relevant labor safety and health regulations.
2.
Provide health information and health check every year to ensure the physical
and mental health of staff.
3.
Conduct company-wide fire safety equipment inspection and repair every year,
and implement fire safety training for employees every six months.
4.
Conduct biennial safety inspections of fire and refuge facilities and equipment in
buildings.
5.
Conduct quarterly inspection of drinking water.
6.
Conduct the working environment inspection every six months, such as: organic
solvent concentration measurement, carbon dioxide concentration measurement,
noise measurement, etc. All of which have passed the inspection.
7.
Strengthen employees' concept of green quality and sustainable management.
8.
The safety of employees in the workplace is the Company's most important
responsibility.
9.
Access control system management: Employees have to use access control cards
as identification when entering and exiting. This system serves as a security
management mechanism for personnel entering and exiting.
(III) Reporting of annual fire incidents, casualties, and employee injury rates, and
corresponding fire safety improvement measures:
In 2024, the Company reported 0 fire incidents.
The Company conducts comprehensive inspections of fire safety equipment
throughout the organization annually. Additionally, fire safety training sessions for all
employees are conducted semi-annually. Every two years, inspections are carried out
to ensure the safety of building fire evacuation facilities and equipment. Moreover,
preventive measures are diligently implemented on a regular basis to minimize the
probabilityof fire occurrences.
(IV) Has the Company provided its
employees with career development		 According to ISO9001, the Company has formulated the Management Procedures for
Employee Education and Training. The Human Resources Department is responsible for the
No deviation

54

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
and training plans? overall planning and promotion of the Company's education and training. Through the
implementation of education and training, employees improve work performance and
cultivate the necessary competencies, facilitating their career development. Meanwhile, the
Company actively enhances employees' knowledge of HSF regulations to meet clients'
needs for products and services. Education training includes internal education training,
external education training, as well as the selection and training of new personnel. In 2024,
a total of 1,343 person-times with 3,788.5 hours of educational training were held
throughout theyear.More than85%of theplanned courseswere completed in 2024.
(V) Has the Company complied with
relevant regulations and international
standards on the health and safety of
clients, client privacy, marketing and
labeling of products and services, and
formulated relevant policies and
complaint procedures to protect the
rights and interests of clients and
clients?		 To ensure the quality of products and services, the marketing and labeling of our products
and services conform to RoHS and the relevant specifications of halogen-free and green
products specified by clients. The Company provides products and follow-up services that
meet clients' quality requirements, formulates sales return and client complaint handling
plans, and conducts an annual client satisfaction survey. It also sets up a special section for
stakeholders on the intranet to provide channels for client communication, complaints and
suggestions to protect clients' rights and interests. Client services:
(I)
Actively participate in seminars on environmental issues held by clients.
(II) Maintain the validity of the client's green product recognition system platform.
(III) Study relevant environmental laws and regulations to continuously improve HSF
operating system and strive to be a reliable green partner of clients. Relevant laws and
regulations are as follows:
1.
EU RoHS.
2.
Halogen Free.
3.
PFOS and PFOA control.
4.
EU REACH SVHC.
5.
SonyGreen Partner。		 No deviation
(VI) Has the Company formulated supplier
management policies that require
suppliers to follow relevant
regulations on issues such as
environmentalprotection,
(I)
Supplier management policies:
The company has long perceived suppliers as important partners and maintained
long-term cooperative relationships with them. In addition to ensuring the quality,
delivery time, price and service capability, suppliers are required to implement
environmentalprotectionpolicies,improve labor safetyand health, payattention to		 No deviation

55

Action item Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
occupational safety and health, or
labor rights? If so, how is the
implementation status?		 work and human rights, fulfill their corporate social responsibilities, and assist and
urge upstream and downstream manufacturers to enhance green competitiveness and
risk management, thus creating sustainable business opportunities. The Quality
Assurance Department carries out the supplier audit (including QSA/QPA/HSF) every
year. A total of 15 suppliers performed audits this year.
(II) Supply chain management:
1.
Evaluation of new manufacturers:
Suppliers who meet our requirements in terms of quality, finance, price, process,
technical aspects, and labor and human rights can be our suppliers.
2.
Evaluation and grading of qualified suppliers:
In accordance with the Supplier Management Regulations, the Company
implements a grading system based on the evaluation results, to provide
reference for procurement. For suppliers whose scores are lower than the
Company's requirements, the Company requires them to improve until they meet
the requirements. In serious cases, the Company may stop purchasing or cancel
the qualification of qualified suppliers.
3.
Supplier workflow change management:
The supplier shall notify the Company in advance and obtain the consent of the
Company before changing its workflow.
4.
Supplier risk management:
The Company requires suppliers to have contingency plans and procedures for
the products and services they provide to ensure continuous operation and
alleviate the impact of shortage of materials on the Company.
5.
Hazardous substances management:
The Company is committed to continuous reduction of hazardous substances to
meet client and regulatory requirements. In accordance with the environmental
protection laws and regulations across the world, the Company has formulated
regulations for the management of hazardous substances for all green products.
Moreover, the Company has been certified by the IECQ QC080000 management
system and requires suppliers topromotejoint compliance with environmental

56

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
protection laws and regulations to safeguard the global environment and reduce
the impact on the ecosystem.
(1) Environmental management substances:
We refer to RoHS2.0, EU REACH, China RoHS and other environmental
management substances regulated by our clients. These harmful substances
exist in direct materials, packaging materials, products, manufacturing
process, manufacturing process accessory materials or may enter the
products. It is necessary to control whether these harmful substances are
contained in the product, the amount contained, the site of use, and the
purpose, etc.
(2) Prohibited substances:
Prohibited substances refer to substances that are prohibited from being
used in the manufacturing process of parts or components, whether they are
intentionally added or naturally present. The minimum concentration limits
and test methods for these substances are regulated in the relevant legal
regulations. All prohibited substances are not allowed to be added
intentionally, even if the added content does not exceed the regulatory
limit.
(3) Green products:
All of our existing halogen-free products comply with regulations and
client specifications.
V.
Has the Company compiled corporate
social responsibility reports or reports
that disclose the Company's
non-financial information based on
international CSR compiling standard
or guidelines? Has the Company
received assurance or certification of
the aforesaid reports from a third
partyaccreditation institution?		 The Company has not yet prepared a sustainability report or other reports that disclose its
non-financial information.		 In accordance with
the regulations
stipulated by the
Financial
Supervisory
Commission
(FSC), the
Company is
required to

57

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
compile and
submit the 2024
Sustainability
Report by the year
2025.
VI. Differences between the Company’s implementation of sustainable development and the Sustainable Development Best Practice Principles if the Company has
established its own sustainable development best practice principles in accordance with the Sustainable Development Best Practice Principles for TWSE/TPEx
Listed Companies:
The Company has formulated its Code of Practice for Sustainable Development in accordance with the Code of Practice for Sustainable Development of
TWSE/GTSM Listed Companies. The differences between the Company's operation and the Code are as follows:
(I)
Implementation of corporate governance: The salary and remuneration policy applicable to general employees has not been established, nor has the
appraisal system for employee performance been integrated with the sustainable development policy of the Company. It will be handled in time according
to the actual needs.
VII. Other important information that can help establish an understanding of the implementation of sustainable development at the Company:
(I)
The Company was rated as Top 20% of the 3rd Governance Evaluation of TWSE/GTSM Listed Companies and won the Best Progress Award.
(II) Selected as one of the "Top 10 Consumer Electronics Solution Provider in APAC – 2019" by Embedded Advisor.
(III) Environmental Protection:
1.
The Company has obtained certification for ISO 9001 and certified by IECQ QC 080000 Hazardous Substance Process Management. The Company
conducts annual certification audit by the accredited firm and has obtained validity certificate for certification system.
Our commitments and practices are as follows:
(1) Continuous attention is paid to improving and eliminating harmful substances to comply with international standards and regulations and to
meet client requirements.
(2) Constantly promote and hold educational training to make all employees fully understand the meaning and responsibility of eliminating
harmful substances.
(3) Establish a qualified supplier system to ensure that materials do not contain hazardous substances.
(4) Continuously improve HSF operating system and strive to be a reliable green partner of clients.
2.
The Company obtained the "ISO 14001 Environmental Management System" certification on March 7, 2023, and the "ISO 14064-1:2018
Greenhouse Gas Emissions Inventory" certification on November 7, 2023.
(IV) Social contribution and service: The Company has participated in the following activities in recent years to make contributions to the society.
1.
Donated to the Tainan Traditional Chinese Culture College Foundation topromote Confucianism,Buddhism,Taoism in the hope of rebuildingsocial

58

Action item Action item Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
values and establishing a harmonious society.
2.
Sponsored the Paper Windmill 368 Township Children’s Art Project, a public welfare initiative promoted by the Paper Windmill Arts and
Educational Foundation, Taiwan, with funds specifically designated for use in the East District of Hsinchu City.
3.
Sponsored the Taiwan Industrial Technology Association. In addition to providing funding to support the association’s operations, Weltrend also
assisted in organizing the Golden Root Award Entrepreneurs Networking Event, fostering stronger collaborations with various industries.
4.
Sponsored Wind Music in World Music Festival: World Music Festival @ Taiwan is the largest outdoor music festival with the theme of world
music in Taiwan. Since its inception in 2016, the three-day music festival has been held every year on the third weekend of October in Taipei City.
The festival is organized by the Bureau of Audiovisual and Music Industry Development, MOC, and hosted by Wind Music, which brings together
world music, pop crossover and diverse ethnic groups throughout the world, with Taiwan as the base and a platform for world music.
(V) Material topic risk management strategies and executionperformance in 2024
Material topicsRisk assessment
items
Strategy description
2024 execution performance
Corporate
Governance
Ethical
corporate
management
1. Substantial corporate culture of integrity.
2. Clear mid- to long-term strategic development goals.
3. Establishment of an integrated management structure.
4. Ethical corporate management and control of operational
performance.
1. No major violations (fines exceeding NT$1 million) or anti-competitive behaviors
occurred.
2. No violations of anti-money laundering regulations, insider trading, or conflicts of
interest cases were reported.
3. All directors participated in 72 hours of external continuing education on corporate
governance throughout the year. Additionally, an internal training session was held for
all directors, covering topics such as insider trading regulations, prevention of insider
trading, recognition of material information, and legal responsibilities related to insider
trading,totaling3.5 hours.
Information
security
Committed to maintaining information security, continuously
monitoring the effectiveness of information security management, and
reducing the occurrence of information security incidents to protect
the interests of the Company and its customers.
1. Completed a security vulnerability scan and revised and enhanced information security
capabilities to protect the company’s critical information assets.
2. The Company has established an Information Security Management Committee and
appointed dedicated personnel for information security. The committee consists of 10
members, with 1 Chief Information Security Officer (CISO) and 2 information security
staff members.
3. In terms of information security risk management, an annual inventory of information
security assets is conducted, with priorities for execution set based on the severity of
risks and the cost of improvements.
4. The Company underwent 2 external audits by risk management organizations during the
year.
Material topics Risk assessment
items
Strategy description		 2024 execution performance
Corporate
Governance		 Ethical
corporate
management		 1. Substantial corporate culture of integrity.
2. Clear mid- to long-term strategic development goals.
3. Establishment of an integrated management structure.
4. Ethical corporate management and control of operational
performance.		 1. No major violations (fines exceeding NT$1 million) or anti-competitive behaviors
occurred.
2. No violations of anti-money laundering regulations, insider trading, or conflicts of
interest cases were reported.
3. All directors participated in 72 hours of external continuing education on corporate
governance throughout the year. Additionally, an internal training session was held for
all directors, covering topics such as insider trading regulations, prevention of insider
trading, recognition of material information, and legal responsibilities related to insider
trading,totaling3.5 hours.
Information
security		 Committed to maintaining information security, continuously
monitoring the effectiveness of information security management, and
reducing the occurrence of information security incidents to protect
the interests of the Company and its customers.		 1. Completed a security vulnerability scan and revised and enhanced information security
capabilities to protect the company’s critical information assets.
2. The Company has established an Information Security Management Committee and
appointed dedicated personnel for information security. The committee consists of 10
members, with 1 Chief Information Security Officer (CISO) and 2 information security
staff members.
3. In terms of information security risk management, an annual inventory of information
security assets is conducted, with priorities for execution set based on the severity of
risks and the cost of improvements.
4. The Company underwent 2 external audits by risk management organizations during the
year.

59

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
2024 execution performance
1. Chip designers achieved target product specifications, with an average CP
(Chip Probing) yield of 94.6% and an FT (Final Test) yield of 96.7%.
2. R&D personnel held a total of 15 technical seminars.
3. Annual training hours were conducted for testing and quality control
personnel.
4. In 2024, the Company obtained 10 patents, and bonuses were awarded to
employees for theirpatented inventions.

1. Annual turnover rate: projected at 9%, actual turnover rate was 6%.
2. Proportion of local employment opportunities: Hsinchu Science Park –
60%; New Taipei City – 67%; Kaohsiung City – 75%.
3. Training course completion rate: 89.88%
A total of 1,343 participants completed 3,788 hours of training throughout
the year.
4. Two rounds of employee performance evaluations were conducted.
1. Supplier Code of Conduct signing rate: 100%. Actual result: Supplier Code
of Conduct signing rate: 100%.
2. Proportion of local procurement: not less than 90%. Actual result:
Proportion of local procurement: 100%.
3. Certification rate for ISO 14001 among all wafer and packaging suppliers:
100%. Actual result: 100% achievement rate for ISO 14001 certification.
4. Certification rate for ISO 45001 among all wafer and packaging suppliers:
not less than 80%. Actual result: 86% achievement rate for ISO 45001
certification.
5. Certification rate for QC080000 among all wafer and packaging suppliers:
not less than 70%. Actual result: 71.4% achievement rate for ISO 45001
certification.
Material topics Risk
assessment
items		 Strategy description 2024 execution performance
Society Product quality
and safety.		 1. Comprehensive and clearly defined circuit design SOPs.
2. Regular circuit design review meetings.
3. Company-wide quality management.
4. Incentives for outstanding projects.		 1. Chip designers achieved target product specifications, with an average CP
(Chip Probing) yield of 94.6% and an FT (Final Test) yield of 96.7%.
2. R&D personnel held a total of 15 technical seminars.
3. Annual training hours were conducted for testing and quality control
personnel.
4. In 2024, the Company obtained 10 patents, and bonuses were awarded to
employees for theirpatented inventions.
Talent
attraction and
development		 1. Establish a professional image of the Company as a market leader in specific
product areas to attract more professionals in related technical fields, as well as
recent graduates entering the workforce.
2. In response to the highly competitive nature of the IC design industry, enhance
the competitiveness of salary and benefits packages and create a positive
working environment.
3. Optimize the internal training and development system to help employees
quickly integrate into the Company culture, receive professional training
within the organization, and effectively demonstrate their capabilities.
1. Annual turnover rate: projected at 9%, actual turnover rate was 6%.
2. Proportion of local employment opportunities: Hsinchu Science Park –
60%; New Taipei City – 67%; Kaohsiung City – 75%.
3. Training course completion rate: 89.88%
A total of 1,343 participants completed 3,788 hours of training throughout
the year.
4. Two rounds of employee performance evaluations were conducted.
Environment Supply chain
management		 1. Incorporate ESG into key supplier evaluations and audit criteria.
2. Conduct regular supplier evaluations and hold periodic meetings.
3. Develop ESG due diligence processes for key suppliers.
4. Establish evaluation standards for existing and new suppliers, focusing on
quality and environmental management.
5. Require suppliers to obtain ISO 14001 certification and give preference to new
suppliers that have implemented ISO 45001 certification.
6. Formulate the Weltrend Supplier Code of Conduct, requiring suppliers to
adhere to responsible and low-carbon supply chain practices.		 1. Supplier Code of Conduct signing rate: 100%. Actual result: Supplier Code
of Conduct signing rate: 100%.
2. Proportion of local procurement: not less than 90%. Actual result:
Proportion of local procurement: 100%.
3. Certification rate for ISO 14001 among all wafer and packaging suppliers:
100%. Actual result: 100% achievement rate for ISO 14001 certification.
4. Certification rate for ISO 45001 among all wafer and packaging suppliers:
not less than 80%. Actual result: 86% achievement rate for ISO 45001
certification.
5. Certification rate for QC080000 among all wafer and packaging suppliers:
not less than 70%. Actual result: 71.4% achievement rate for ISO 45001
certification.

60

Action item Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Implementation status (Note 1) Deviations from
the Sustainable
Development Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
Greenhouse gas
management
and carbon
reduction
1. Actively support national carbon reduction policies and the Financial
Supervisory Commission’s ―Sustainable Development Roadmap for
TWSE/TPEx Listed Companies.‖
2. Conduct annual GHG inventories, continuously identify emission hotspots,
and formulate corresponding countermeasures.		 1. Completed the 2023 voluntary GHG inventory (including Taipei, Hsinchu,
Taichung, and Kaohsiung sites) by the end of June 2024.
2. Disclosed GHG inventory data (Scope 1 and Scope 2) on the Company’s
official website under the ―Energy Conservation and Carbon Reduction‖
section.

  • Note 1: If "Yes" is checked, please specify the important policies, strategies, measures adopted and the implementation situation; If "No" is checked, please explain the circumstances and reasons for the differences in the field of Circumstances and Reasons for Deviations from the Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies and propose the plan to adopt relevant policies, strategies and measures in the future. However, in relation to the promotion of Items 1 and 2, TWSE/TPEx Listed Companies shall clarify the governance and supervisory framework for sustainable development, including but not limited to management policies, strategy and target setting, review measures, etc. It shall also describe the corporate risk management policies or strategies for environmental, social and corporate governance issues related to operations, and its assessment status.

  • Note 2: Materiality principle refers to environmental, social and corporate governance issues that have a significant impact on the Company's investors and other stakeholders.

61

Climate-related Information

I. Execution status of climate-related information:

Items Implementation status: Implementation status: Implementation status: Implementation status: Implementation status:
1.
Supervision and Governance by
the Board of Directors and
Management on Climate-Related
Risks and Opportunities.












 In response to climate change and to mitigate the worsening effects of global warming, the Company is committed to GHG
reduction initiatives, aiming to achieve net-zero emissions by 2050 in alignment with global targets.
The Company has established a ―Sustainable Development Team‖ under the Board of Directors, composed of members with
expertise and capabilities in corporate sustainability. The Board of Directors holds a meeting quarterly, during which the
Sustainable Development Team presents reports addressing current climate change-related issues. These reports include:
1.
Global trends in climate change.
2.
The latest developments in international emissions reduction, such as SBTi requirements.
3.
Updates on domestic regulations and corresponding phased requirements.
4.
Consolidated and interpreted market information.
Accordingly, in addition to developing relevant environmental management systems, the Sustainable Development Team
actively gathers up-to-date information and urges responsible departments to conduct GHG inventories and explore emission
reduction strategies. These findings are compiled and reported to the Board of Directors to enhance the Board of Directors'
understandingof climate-related issues and support informed decision-making.
2.
The Corporate Sustainable
Development Task Force
identifies how recognized climate
risks and opportunities may
impact the Company's operations,
strategies, and finances in the
short-term, mid-term, and
long-term.




 In accordance with the ―Weltrend Semiconductor Risk Management Policy and Procedures,‖ the Company actively
formulates solutions to mitigate the operational and financial impacts of climate change, with the aim of enhancing the
Company’s climate resilience. The Company defines short-term as within 3 years, medium-term as 3 to 5 years, and
long-term as over 5 years. Based on these timeframes, we further assess both visible and potential impacts of climate change
on theCompany.
Items
Type
Impact
Risk
■
Transition risks
■
Taiwan's climate change policies have become
increasingly clear, with the development and
enforcement of various regulations now
underway. As a result, the Company faces
regulatory compliance risks.
■
Implementation of total GHG
emissions control.
■
Enforcement of laws and regulations
related to GHG emissions reduction.
■
Execution of carbon tax and carbon fee
policies.
■
Implementation of the European
Union’s Carbon Border Adjustment
Mechanism (CBAM).
■
Consumers are increasingly
demanding low-carbon products in
response to their growing concerns
about climate change.
■
Introduction of carbon reduction
technologies, leading to increased
capital expenditures on equipment.
■
Potential reputational damage if the
Company fails to adequately
respond to climate change.
The trend of
net zero
emissions
■
Physical risks
■
Immediate risks from extreme weather:
Currently, there have been no damages
caused by extreme weather at the
Company’s operational sites. However,
prolonged water shortages are expected
to increase difficulties in supply chain
production.
■
Changes in rainfall patterns:
Alterations in the rainfall patterns at
the Company’s operational locations
may lead to heavy rainfall, which
could affect personnel, equipment,
and business operations.
Supply chain
disruption
Opportunity ■
The opportunity to enhance the Company’s
climate resilience, effectively expand the market,
and increase customer trust.
■
Research and development of
low-carbon products.
■
Improved resource utilization
efficiency.
Enhancement
of corporate
image.
Items Type Impact
Risk ■
Transition risks
■
Taiwan's climate change policies have become
increasingly clear, with the development and
enforcement of various regulations now
underway. As a result, the Company faces
regulatory compliance risks.		 ■
Implementation of total GHG
emissions control.
■
Enforcement of laws and regulations
related to GHG emissions reduction.
■
Execution of carbon tax and carbon fee
policies.
■
Implementation of the European
Union’s Carbon Border Adjustment
Mechanism (CBAM).		 ■
Consumers are increasingly
demanding low-carbon products in
response to their growing concerns
about climate change.
■
Introduction of carbon reduction
technologies, leading to increased
capital expenditures on equipment.
■
Potential reputational damage if the
Company fails to adequately
respond to climate change.		 The trend of
net zero
emissions
■
Physical risks		 ■
Immediate risks from extreme weather:
Currently, there have been no damages
caused by extreme weather at the
Company’s operational sites. However,
prolonged water shortages are expected
to increase difficulties in supply chain
production.
■
Changes in rainfall patterns:
Alterations in the rainfall patterns at
the Company’s operational locations
may lead to heavy rainfall, which
could affect personnel, equipment,
and business operations.
Supply chain
disruption
Opportunity ■
The opportunity to enhance the Company’s
climate resilience, effectively expand the market,
and increase customer trust.
■
Research and development of
low-carbon products.		 ■
Improved resource utilization
efficiency.		 Enhancement
of corporate
image.

62

Items Implementation status:
R: Risks,O: Opportunities
R: Total greenhouse gas
emission control and c]arbon
taxes/fees
R: Market customers demand
low-carbon emission products
O: Development and design of
low-carbon products
 Countermeasures
■ Strengthening internal
personnel's knowledge of
climate change and
continuously monitoring
domestic and international
trends and changes related to
these issues.
■ Continuously invest in the
research and design of green
products and actively
implement a localized
procurement policy to reduce
emissions from transportation.
Financial impact(Positive/Negative) Countermeasures
Negative: The Company may be subject to carbon tax,
carbon fees, or even the EU's carbon border tax, leading
to a significant increase in operating costs.
Negative: Non-compliance with Taiwanese regulations
could increase the risk of fines, resulting in higher
operating costs.
Negative: The installation of solar power generation has
resulted in an increase in operatingcosts.		 ■ Strengthening internal
personnel's knowledge of
climate change and
continuously monitoring
domestic and international
trends and changes related to
these issues.
Negative: Failure to meet customer requirements may
lead to a decline in revenue.
Positive: Enhancing the development and design of
low-carbon products can effectively address user
concerns regarding climate change issues.		 ■ Continuously invest in the
research and design of green
products and actively
implement a localized
procurement policy to reduce
emissions from transportation.
3.
Impact of Extreme Climate
Events and Transition Actions on
Finance.






 The Company’s operating locations are subject to a low level of impact from extreme climate change. The only notable
concern is the potential reduction in working hours and production output caused by heavy rainfall, which may in turn affect
revenue. Fortunately, despite the temporary revenue loss resulting from such rainfall events, their impact is short-term and
transient, and is not expected to cause any material financial impact over the long run. Furthermore, based on current
assessments of the climate characteristics in the regions where our supply chain operates, suppliers have indicated that they
are well-prepared to cope with climate-related disruptions, particularly through the implementation of business continuity
measures. As a result, the risk of supply chain interruption to the Company is relatively low.
4.
Integration of Climate Risk
Identification, Assessment, and
Management Processes into
Overall Risk Management
Framework.




 The Company, through its Sustainable Development Team, has established a ―Risk Management Policy and Procedure‖ that
applies to the identification, assessment, and determination of risks across various issues. The Company adopts a
multi-perspective approach—such as brainstorming sessions—to identify potential risks and opportunities related to each
topic, while continuously monitoring market trends to ensure timely updates to risk content. Additionally, the Company
conducts quantitative assessments of each identified risk and formulates corresponding mitigation strategies.

63

Items Implementation status: Implementation status: Implementation status:
5.
If utilizing scenario analysis to
assess resilience against climate
change risks, one should
elucidate the context, parameters,
assumptions, analytical factors,
and primary financial impacts
involved.		 The Company conducts scenario analyses based on data and models provided by the ―Taiwan Climate Change Projection
and Information Platform.‖ This platform offers detailed analyses of various climate scenarios and provides region-specific
climate projection models across Taiwan, significantly facilitating the Company’s efforts in carrying out related assessments.
Currently,the Companyutilizes the followingmodel(s):
Scenario
Estimatedpotential financial impact
RCP8.5 high emissions scenario
Assumes no additional global decarbonization efforts
beyond currentpolicies.
Operating costs are expected to increase by approximately
0.99% of revenue.
RCP2.6 low carbon scenario
Assumes global achievement of net-zero emissions by
2050.
Due to the need to implement concrete carbon reduction
measures, the associated costs are expected to increase
significantly,accountingfor approximately0.088% of revenue."
Scenario Estimatedpotential financial impact
RCP8.5 high emissions scenario
Assumes no additional global decarbonization efforts
beyond currentpolicies.		 Operating costs are expected to increase by approximately
0.99% of revenue.
RCP2.6 low carbon scenario
Assumes global achievement of net-zero emissions by
2050.		 Due to the need to implement concrete carbon reduction
measures, the associated costs are expected to increase
significantly,accountingfor approximately0.088% of revenue."
6.
If there is a transformation plan
for managing climate-related
risks, the explanation of the plan's
contents should include the
indicators and objectives utilized
for identifying and managing
physical risks and transition risks.
None
7.
If utilizing internal carbon pricing
as a planning tool, one should
elucidate the basis for price
determination.		 None
8.
If climate-related goals are
established, the description
should include information on the
covered activities, scope of
greenhouse gas emissions,
planning timeframe, progress
achieved annually, etc. If carbon
offsetting or Renewable Energy
Certificates (RECs) are utilized to
achieve the relevant goals, details
should be provided regarding the
sources and quantities of the
offset carbon emissions or RECs.

The Company is in the IC design industry, and the main sources of greenhouse gas emissions are indoor air conditioning and
office lighting, which fall under "Scope 2" as indirect emissions from electricity use. Emissions from "Scope 1" direct and
"Scope 3" other indirect sources are relatively minimal. Based on the current situation, the emissions from Scope 1 and
Scope 2 are still at a reasonable level. The company aims to strengthen efforts to achieve a 3% reduction in carbon emissions
per unit (NT$ thousand) of revenue by 2026.

64

Items Implementation status:
9.
Greenhouse gas inventory and
assurance situation, reduction
targets, strategies, and specific
action plans.		 1.
In accordance with the regulations of the Financial Supervisory Commission (FSC), starting from the year 2026, the
annual report of the Company must disclose the greenhouse gas inventory information for the previous year (2025),
and this disclosure should continue annually. From 2028 onwards, the disclosure should also include the assurance
situation of the 2027 inventory information.
2.
In accordance with the regulations of the Financial Supervisory Commission (FSC), both the Company and its
consolidated subsidiaries must disclose the greenhouse gas inventory information for the previous year (2026) starting
from 2027. The greenhouse gas emissions base year should not be later than 2026. The disclosure should include the
greenhouse gas reduction targets, strategies, and specific action plans for the current year (2027). These contents
should be disclosed annually, along with the disclosure of the achievement of the reduction targets for the previous
year. From 2029 onwards,the disclosure should also include the assurance situation of the 2028 inventoryinformation.
  • 1-1 Recent two years of the Company's greenhouse gas inventory and verification status

1-1-1 Greenhouse gas inventory information

Greenhousegas inventoryinformation Greenhousegas inventoryinformation Greenhousegas inventoryinformation Greenhousegas inventoryinformation Greenhousegas inventoryinformation
Describe thegreenhousegas emissions(in metric tons of CO2e),intensity (in metric tons of CO2e/NT$million),and the scope of data coverage for the last twoyears.
Unit 2022 2023 Difference
Greenhouse gas emissions
(Scope 1)		 t-CO2e/year 51.9452
55.0629
6.00%
Greenhouse gas emissions
(Scope 2)		 t-CO2e/year 1,400.4770 1,440.7278
2.87%
Greenhouse gas emissions
(Scope 3)		 t-CO2e/year 263.6251
297.5160
12.86%
Greenhouse gas emissions
intensity		 (Metric tons
CO2e/NT$million)		 0.5942
0.6215
4.60%

  • Note 1: Direct emissions (Scope 1, i.e., emissions directly from sources owned or controlled by the Company), energy indirect emissions (Scope 2, i.e., greenhouse gas emissions caused by the consumption of purchased electricity, heat, or steam), and other indirect emissions (Scope 3, i.e., emissions generated by the Company’s activities, but not from energy-related indirect emissions, and originating from sources owned or controlled by other Companies).

  • Note 2: The coverage of data for direct emissions and energy indirect emissions should be handled according to the schedule defined in the regulations under Article 10, Section 2 of these guidelines. Other indirect emissions information may be disclosed voluntarily.

  • Note 3: Greenhouse Gas Inventory Standard: The Greenhouse Gas Protocol (GHG Protocol) or the ISO 14064-1 standard issued by the International Organization for Standardization (ISO).

  • Note 4: The intensity of greenhouse gas emissions can be calculated per unit of product/service or revenue, but at a minimum, the data calculated based on revenue (NT$ millions) must be disclosed.

65

1-1-2 Greenhouse gas assurance information

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

  1. The assurance verification certificate for the 2022 greenhouse gas inventory obtained in 2023 is as follows:
The assurance verification certificate for the 2022 greenhouse gas inventory obtained in 2023 is as follows:
Year
Scope of Assurance
Assuranceprovider
Assurance Standard
Assurance Opinion		 2023
All headquarters and branch offices (including the Hsinchu Office, Taipei Office,
TaichungOffice,and KaohsiungOffice),excludingsubsidiaries.
TÜ V NORD
14064-1 : 2018
NA

2. In 2024, the Company will conduct self-assessment of the 2023 greenhouse gas inventory.

  • Note 1: This process should be carried out according to the schedule outlined in Paragraph 2, Article 10 of the relevant regulations. If the Company does not obtain complete assurance opinions for the greenhouse gas inventory by the date of the annual report publication, it should state "Complete assurance information will be disclosed in the sustainability report." If the Company does not prepare a sustainability report, it should state "Complete assurance information will be disclosed on the Market Observation Post System," and the complete assurance information should be disclosed in the following year's annual report.

  • Note 2: The assurance provider should comply with the relevant regulations for sustainability report assurance institutions as established by the Taiwan Stock Exchange Corporation and the Taipei Exchange.

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

Describe the base year for greenhouse gas reduction and its data, reduction targets, strategies, and specific action plans, as well as the progress towards achieving the reduction targets.

  1. The base year for greenhouse gas reduction is 2022, with the following data:
Unit 2022
Greenhouse gas emissions (Scope 1) t-CO2e/year 51.9452
Greenhouse gas emissions (Scope 2) t-CO2e/year 1,400.4770
Greenhouse gas emissions (Scope 3) t-CO2e/year 263.6251

  1. Reduction target: The goal is to achieve a 3% reduction in carbon emissions per unit (NT$ thousand) of revenue by 2026.

  2. Strategy and specific action plan: In 2024, increase the air storage tank on the air compressor to reduce frequent operations, which will help reduce the power consumption per unit for products in the (26th Building 1F) test room, electrical number ： 06-25-0185-10-0 by 5%.

  3. Achievement of reduction target: For the (26th Building 1F) test room, electrical number: 06-25-0185-10-0, from August to November, the reduction rate = (value before reduction - value after reduction)/value before reduction × 100% = 8%, achieving the set target of 5%.

66

==> picture [337 x 97] intentionally omitted <==

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

Electricity consumption per Electricity consumption per
unit of product from unit of product from August
August to November 2023 to November 2024
(CP+FT) (CP+FT)
0.0149 0.0137
Usage (kWh)
----- End of picture text -----

Electricity consumption per unit of roduct=

(CP monthly production capacity (PCS)(PCS) + FT monthly production capacity (EA)(EA))

Decline rate from August to November = ((Value before the decline - Value after the decline)/Value before the decline) × ×100%= = 8%

Note 1: The schedule should be implemented in accordance with the regulations set forth in Paragraph 2, Article 10 of this guideline.

Note 2: The base year should be the year in which the consolidated financial statements boundary is completed. For example, according to the regulations set forth in Paragraph 2, Article 10 of this guideline, companies with a capital of over NT$10 billion should complete the audit of the consolidated financial statements for 2024 by the end of 2025. Therefore, the base year would be 2023. If the Company has completed the audit of the consolidated financial statements earlier, that earlier year may be used as the base year. Additionally, the data for the base year may be calculated using a single year's value or the average value of multiple years.

Section One: Identification of Climate Change Risks

Category Risk Impact Mitigation measures
Transition risks Energy and greenhouse gas regulations Increase in operational costs Continued implementation of energy-saving and emission-reduction activities to
reduce environmental impact.
Uncertaintyin market demand Operational cost losses Enhancing product efficiencyto increaseproduct'sgreen competitiveness.
Uncertainty in new technologies Increased research and
development costs		 Focusing on the development of new technologies, strengthening R&D capabilities,
and nurturingR&D talents.
Impact on companyimage Loss ofgoodwill Increasingtheproduction of low-powergreenproducts to enhance corporate image.
Physical risks Immediate risk: Typhoons 1. Financial losses
2. Decreased revenue		 In the event of a typhoon, stay updated on local government regulations and warning
messages.
Long-term risk: Increase in average
temperatures		 Increase in operational costs Continued implementation of energy-saving and emission-reduction activities to
reduce environmental impact.

Section Two: Identification of Climate Change Opportunities

Category OpportunityFactors Financial Impact Mitigation measures
Climate change
opportunities		 Productionprocesses Improveproductyield to reduce scrapcosts. Monitor supplychainprocesses to ensureproductquality.
Design low-power products Offer low-carbon products to enhance corporate
reputation and increase revenue.		 Continuously develop small-volume, low-power green
products.
Provide integrated products to reduce packaging
material usage.		 Develop integrated packaging products Continuously develop integrated packaging products to
enhanceproductgreen competitiveness.

67

Category OpportunityFactors Financial Impact Mitigation measures
Provide new solutions to meet customer
demands related to climate change.		 Increase revenue Continue development of BLDC MCU
Utilize emerging markets Expand revenue from energy-saving products 1. Enter the AI server cooling application market.
2. Customize chips tailored to specific customer
functional requirements.

Section Three: Core Framework for Task Force on Climate-Related Financial Disclosures (TCFD).

Core elements Response explanation
Governance The Company's Corporate Sustainability Development Task Force is responsible for exploring various climate change issues and identifying potential
impacts on both internal and external stakeholders. The Director of Corporate Sustainability Development regularly reports to the Board of Directors
on climate change response measures. The Board reviews these response strategies andprovides directives accordingly.
Strategies The Company's Corporate Sustainability Development Task Force is the highest management level for climate-related issues, with the CEO serving as
the convener. The members include representatives from the President's Office, Finance Department, Human Resources Department, and Quality
Assurance Department. It is responsible forplanningandpromotingactivities related to corporate sustainabilityand climate-related issues.
Risk management To assess whether sustainable business products may impact the environment, the Company utilizes the Corporate Sustainability Development Task
Force to conduct regular risk assessments on climate change. Based on the assessment results, policies and objectives are formulated and reported to
the Board of Directors.
Indicators and Objectives The Company has completed its 2022 GHG emissions inventory and established a corresponding database. Using 2022 as the base year, the Company
aims to achieve a 3% reduction in carbon emissionsper NT$1,000 of revenue by2026,and will strengthen efforts to reach this target.

Section Four: Results of Greenhouse Gas Inventory

Total emissions
 Intensity
 Assurance provider Assurance statement explanation
(metric tons of CO2e) (Metric tons CO2e/NT$ million)
Scope 1 55.0629 0.0191 TÜ V NORD In 2023, the scope of greenhouse gas inventory for the
Company includes all operational locations of both the
main companyand its subsidiaries.
Scope 2 1,440.7278 0.4988 TÜ V NORD In 2023, the scope of greenhouse gas inventory for the
Company includes all operational locations of both the
main companyand its subsidiaries.
Scope 3 (voluntary disclosure) 297.5160 0.1030 TÜ V NORD In 2023, the scope of greenhouse gas inventory for the
Company includes all operational locations of both the
main companyand its subsidiaries.

68

  • (VI) Implementation of ethical corporate management as well as deviations from the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies and related reasons
Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
I.
Establishment of ethical corporate
management policies and programs
(I)
Has the Company established ethical
corporate management policies approved by
the Board of Directors and specified in its
rules and external documents the ethical
corporate management policies and practices
and the commitment of the Board of
Directors and senior management to rigorous
and thorough implementation of such
policies?
(II) Has the Company established a risk
assessment mechanism against unethical
conduct and does it analyze and assess on a
regular basis business activity within its
business scope which are at a higher risk of
being involved in unethical conduct and
establish prevention programs accordingly,
which shall at least include the preventive
measures specified in Article 7-2 of the
Ethical Corporate Management Best Practice
Principles for TWSE/GTSM Listed
Companies?
(III) Has the Company established policies to
prevent unethical conduct with clear
statements regarding relevant procedures,
code of conduct, punishments for violation,

(I)
The Company has established the Ethical Corporate Management Best
Practice Principles approved by the Board of Directors. The management
shall operate business on the principle of integrity and creates benefits for
employees and shareholders. Specifically, the management shall comply
with the Company Act, Securities and Exchange Act, Business Entity
Accounting Act, Political Donations Act, Regulations on the Crime of
Embezzlement, Government Procurement Act, Act on Recusal of Public
Servants Due to Conflicts of Interest, relevant regulations on TWSE/TPEx,
or other relevant laws and regulations on business behaviors, as the basic
premise of implementing the ethical corporate management. With respect to
the commitment of the Board of Directors and senior management to
actively implement the management policy, the Chairman of the Board of
Directors has stated the policy of ethical corporate management in the CSR,
and the Board of Directors and senior management have actively
implemented the policy with a high degree of self-discipline and prudence.
(II) In the Ethical Corporate Management Procedures and Code of Conduct, the
Company specifically regulates the matters that should be paid attention to
by our staff in the execution of business, and adopts preventive measures for
business activities with high risk of unethical behaviors, including
prohibiting unethical behaviors such as bribery and accepting of bribes,
providing non-political donations, improper charitable donations or
sponsorship. Before entering into a business relationship with others, the
Company should first assess the legality, ethical corporate management
policy of its agents, suppliers, clients or other business partners and whether
they have been involved in unethical behaviors to ensure that their business
practices are fair, transparent and do not ask for, offer or accept bribes. In the
process of business activities,the Companyshall explain its ethical
No deviation

69

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
rules of appeal, and commitments to
implementation of these policies? Has the
Company regularly reviewed and amended
these policies?		 corporate management policy and relevant regulations to the transaction
parties, and clearly refuse to directly or indirectly provide, promise, demand
or accept any improper benefits in any form or name. Personnel of the
Company shall refrain from engaging in business transactions with agents,
suppliers, clients or other business partners involved in unethical behaviors.
If unethical behaviors are found in business dealings or cooperative partners,
the Company shall immediately stop business dealings with them and list
them as the object of refusal. To strengthen internal ethical corporate
management, the Company has sent personnel to participate in relevant
training courses organized by government units in 2024, such as: "Seminar
on Enhancing the Efficiency of Criminal Litigation for Trade Secret
Protection: Observations and Recommendations," "ESG Integrity-related
Courses: Trade Secret Protection and Anti-Fraud Advocacy," TSMC's public
welfare sharing introduction "Sustainable Intelligent Management Center for
Trade Secrets," and the advocacy "Explanation of Self-assessment Indicators
for Sustainable Intelligent Management of Trade Secrets." The Company
arranges compliance education and training related to "Ethical Corporate
Management" for all new employees. The training courses for new
employees this year have been completed. Every quarter, we promote "What
is a Trade Secret" and "Ethical Corporate Management Compliance Matters"
to the entire company through the company announcement system. The total
number of participants for the above-mentioned courses is 330, with a total
of 170.5 hours.

70

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
The Company carries out quarterly publicity of corporate confidential
information protection policy, personal data protection, information security,
and reveals the content of the publicity on its intranet and sends e-mails to
all employees. The Company constantly promotes the ethical corporate
management policy internally and has the obligation to help clients, partners,
suppliers, service providers, agents, and consultants understand its policy
and follow it together.
(III) The Company has established the Code of Ethical Corporate Management,
the Code of Ethical Conduct and the Ethical Corporate Management
Procedures and Code of Conduct, and has specified a disciplinary and
grievance system in them. The Company adopts preventive measures for
business activities with high risk of unethical behaviors, including
prohibiting unethical behaviors such as bribery and accepting of bribes,
providing non-political donations, improper charitable donations or
sponsorship. Personnel of the Company shall not directly or indirectly
provide, promise, demand or accept any improper benefits or commit any
other unethical behaviors in violation of good faith, illegal or breach of
fiduciary duties. The personnel who violate the provisions of ethical
corporate management will be punished according to the disciplinary
measures set by the Company. The Company also has an appeal system to
provide the means of relief for the violators according to the relevant
provisions.
Human Resources Department is responsible for the revision,
implementation, interpretation, advisory services and notification of the
operating procedure and Code of Conduct and supervises its implementation.
The Board of Directors shall report its implementation status to the directors
regularlyin the fourthquarter of eachyear.
II.
Implementation of ethical corporate
management
(I)
Has the Companyassessed the ethics records		 (I)
Before business dealings,The Companyshall consider the legitimacyof its

71

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
of anyone with whom it has a business
relationship and included business conduct
and ethics-related clauses in business
contracts?


agents, suppliers, clients or other business counterparties and whether they
are involved in unethical behaviors, and shall avoid entering into
transactions with those involved in unethical behaviors. The contents of the
contract signed with the business counterparties shall include compliance
with the ethical corporate management policy. If the business counterparties
are involved in unethical behaviors. The terms of a contract may be
terminated or dissolved at any time. When evaluating business
counterparties, the Company conducts appropriate investigation and
examines its business counterparties to ascertain their ethical corporate
management in the following matters:
1.
The country, place of operation, organizational structure, business
policy and place of payment of the counterparty.
2.
Whether the counterparty has established an ethical corporate
management policy and its implementation status.
3.
Whether the counterparty operates in a country with a high risk of
corruption.
4.
Whether the counterparty operates in a industry with high risk of
bribery.
5.
The long-term business status and goodwill of the counterparty.
6.
Ask business partners for their opinions on the counterparty.
7.
Whether the counterparty has a history of unethical behaviors such as
bribery or illegal political donations.
When entering into contracts with counterparties, the Company shall fully
understand the ethical corporate management of counterparties, and
incorporate the compliance with the Company's ethical corporate
management policy into the terms of the contract, as follows:
1.
If either party knows that a person has violated the terms of the
contract prohibiting the acceptance of commissions, kickbacks or other
illegitimate benefits, it shall immediately and truthfully inform the
otherpartyof the identityof such aperson,the manner,amount or		 No deviation

72

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(II) Has the Company set up a unit dedicated to
promoting the Company’s ethical standards
reporting regularly (at least once a year) to
the Board of Directors on the implementation
of ethical corporate management policies and
prevention programs against unethical
conduct?
(III) Has the Company formulated policies to
prevent conflicts of interest, provided
appropriate communication and complaint
channels, and implemented such policies
properly?
other illegitimate benefits offered, promised, demanded or received,
and provide relevant evidence and cooperate with the other party's
investigation. f one party suffers any damage as a result, it may claim
damages from the other party and deduct the amount from the contract
price payable.
2.
If either party is involved in unethical behaviors, the other party may
unconditionally terminate or rescind the contract at any time.
3.
Set out clear and reasonable terms of payment, including the place and
method of payment and the relevant tax legislation to be complied
with.
(II) The Company has established an ESG Sustainable Development Team, with
the CEO serving as the convener. The team focuses on six key areas of
sustainability and is composed of members from various departments. The
team is responsible for promoting corporate integrity management and
regularly reports on integrity management policies, anti-dishonesty
measures, and their implementation progress to the Board of Directors
during the fourth quarter of each year.
In accordance with the Ethical Corporate Management Procedures and Code
of Conduct adopted by the Board of Directors, Human Resources
Department is responsible for the revision, implementation, interpretation,
advisory services and notification of the operating procedure and Code of
Conduct and supervises its implementation.
(III) The Company's Code of Ethical Conduct and Code of Ethics for Employees
have formulated provisions to prevent conflicts of interest. The personnel of
the Company shall not use their positions to obtain improper benefits for
themselves, their spouses, parents, children or relatives within the second
degree of kinship. In the event that the Company has any loan or guarantee,
major asset transaction or import (sale) transaction with the related
enterprises of the foregoing personnel, the relevant personnel of the
Companyshall take the initiative to explain to the Companywhether there is

73

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
(IV) Has the Company established effective
accounting and internal control systems for
the implementation of ethical corporate
management? Has its internal audit unit
devised relevant audit plans based on the
assessment results of the risk of involvement
in unethical conduct, and checked the
compliance with the prevention programs or
entrusted CPAs to conduct such an audit?
(V) Has the Company provided internal and
external ethical conduct training programs on
a regular basis?		 any potential conflict of interest with the Company and handle the matter
according to the code of conduct of the Company to prevent the conflict of
interest.
(IV) The Company has established an effective accounting system and internal
control system for the business activities and operating procedures with high
potential risk of unethical behaviors, and reviews them at any time to ensure
the design and implementation of the systems is sustainable and effective.
The internal auditing unit includes the two systems in the risk assessment for
regular inspection and check the compliance with the systems on a regular
basis.
(V) To strengthen Ethical Corporate Management, the Company conducts
internal education and advocacy on integrity management annually through
the ESG Sustainable Development Team, and has sent personnel to
participate in relevant training courses organized by government units in
2024, such as: "Seminar on Enhancing the Efficiency of Criminal Litigation
for Trade Secret Protection: Observations and Recommendations," "ESG
Integrity-related Courses: Trade Secret Protection and Anti-Fraud
Advocacy," TSMC's public welfare sharing introduction "Sustainable
Intelligent Management Center for Trade Secrets," and the advocacy
"Explanation of Self-assessment Indicators for Sustainable Intelligent
Management of Trade Secrets." The Company arranges compliance
education and training related to "Ethical Corporate Management" for all
new employees. The training courses for new employees this year have been
completed. Every quarter, we promote "What is a Trade Secret" and "Ethical
Corporate Management Compliance Matters" to the entire company through
the company announcement system. The total number of participants for the
above-mentioned courses is 330, with a total of 170.5 hours.
At least once ayear,the Companyconducts legal education for directors,

74

Evaluation items Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
managers and employees to prevent insider trading, and provide the relevant
education for new directors and managers within one month of their
appointment. In 2024, in addition to arranging 3 directors to attend the
Publicity Meeting on Preventing Insider Trading held by the competent
authority in October, the current 10 directors received a total of 3.5 hours of
training and publicity in the fourth quarter of 2024. The content included
explanations of insider trading regulations, prevention of insider trading,
identification of significant information, and legal responsibilities related to
insider trading. The Company arranged education and training on prevention
of insider trading for new employees. In 2024, 27 newcomer trainings were
completed.
The Company has conducted quarterly internal system promotions on
prevention of insider trading in the internal system and published the
relevant education and training briefing in the internal staff system for online
training of all employees for a month. The Company carries out quarterly
publicity of corporate confidential information protection policy, personal
data protection, information security, and reveals the content of the publicity
on its intranet and sends e-mails to all employees. The Company constantly
promotes the ethical corporate management policy internally and has the
obligation to help clients, partners, suppliers, service providers, agents, and
consultants understand itspolicyand follow it together.
III. Operation of the whistleblowing system
(I)
Has the Company established specific
whistle-blowing and reward systems, set up
conveniently accessible whistle-blowing
channels, and designated responsible
individuals to handle the person(s) being
reported?		 (I)
The Company has established a whistle-blowing system, including the
"whistle-blowing system for the violation of professional ethics behaviors"
in the external website and the "employee mailbox" in the internal website.
The whistle-blowing system and employee mailbox provide direct access to
the senior management unit. Once the whistle-blowing is received, the
senior management unit will work with the relevant human resources and
auditing units to investigate and handle it. If it is illegal or serious, it will be
transferred to the relevantgovernment units.		 No deviation

75

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No Summary
(II) Has the Company established standard
operating procedures for investigating
reported misconduct, follow-up measures to
be taken after investigations, and related
confidentiality mechanisms?
(III) Has the Company adopted proper measures
to protect whistle blowers from retaliation for
their actions?

(II) The Company has set out the standard operating procedure for accepting the
complaint and the follow-up measures to be taken after the investigation. It
has stipulated the detailed operating procedure and schedule from the receipt
of the complaint to the conclusion of the case. If it is proved that the person
being reported has violated the relevant laws and regulations or the
Company's policies and regulations on ethical corporate management, the
person shall be immediately requested to stop the relevant behavior and
dispose of it appropriately. When necessary, the Company shall report to the
competent authorities, transfer the person to the judicial authorities for
investigation, or claim compensation through legal procedures to protect the
reputation and rights of the Company. In addition, the Company has
established the principle of confidentiality, and senior management, human
resources and auditing units that receive reports and conduct investigations
shall carefully manage the matters or secrets they know from their positions.
Unless disclosed by the Company or provided for the performance of duties,
it shall not be disclosed to others, and the obligation of confidentiality shall
be strictly observed no matter during the service period or after resignation.
(III) The Company shall properly handle the identity and contents of the whistle
blowers in a confidential and responsible manner, and protect them from
beingthreatened.
IV. Enhancing information disclosure
Has the Company disclosed, on its website or
on the Market Observation Post System, its
ethical corporate management policies and
the effectiveness of thepromotion thereof?


The Company has disclosed the Code of Ethical Corporate Management, the Code
of Ethical Conduct and the Ethical Corporate Management Procedures and Code
of Conduct, and the Code of Ethics for Employees on its website, and the Code of
Ethical Corporate Management and the Code of Ethical Conduct on the Market
Observation Post System.
No deviation

76

Evaluation items Status of implementation Status of implementation Status of implementation Deviations from the
Ethical Corporate
Management Best
Practice Principles
for TWSE/TPEx
Listed Companies
and related reasons
Yes No
Summary
V.
If the Company has established ethical corporate management policies based on the Ethical Corporate Management Best-Practice Principles for TWSE/TPEx
Listed Companies, please describe any deviation between the policies and their implementation: None.
The Company has formulated its Code of Practice for Ethical Corporate Management in accordance with the Code of Practice for Ethical Corporate
Management of TWSE/GTSM Listed Companies. The differences between the Company's operation and the Code are as follows:
(I)
Education, training and assessment: The Company has not included the ethical corporate management policy in the employee performance assessment
system. It will be handled in due course according to actual needs.
(II) Information disclosure: The Company has not collected quantitative data to promote ethical corporate management. It will be handled in due course
accordingto actual needs.
VI. Other important information that facilitates a better understanding of the Company’s ethical corporate management policy (e.g., review and amend its policy):
The Company has established the Code of Ethical Corporate Management and the Ethical Corporate Management Procedures and Code of Conduct. The latter
was amended on March 12, 2020 with the approval of the Board of Directors and the former was amended on April 6, 2022 with the approval of the Board of
Directors.

77

  • (VII) Other important information that may be disclosed to enhance understanding of corporate governance operations: For information on the Company's corporate governance practices, please visit the Market Observation Post System (https://mopsplus.twse.com.tw) or our website (http://www.weltrend.com.tw).

  • (VIII) The implementation of the internal control system shall disclose the following matters:

  • Internal Control Statement: Please refer to the Market Observation Post System (MOPS) for inquiries: Market Observation Post System (MOPS) → Individual Company → Corporate Governance → Company Regulations/Internal Control → Internal Control Statement Announcement, to query the 2024 Internal Control Statement. https://mops.twse.com.tw/mops/#/web/t06sg20

  • Those who entrust CPAs to conduct special audit of internal control systems shall disclose the audit reports of CPAs: None.

  • (IX) Major resolutions of Shareholders’ Meeting and Board Meetings as of the most recent fiscal year and as of the publication date of this report:

  • Major resolutions and implementations from the Shareholders’ Meeting in 2024:

    • a. Ratified the proposal for the 2023 Business Report and Financial Statements.

    • b. Ratified the proposal for 2023 Earnings Distribution.

      • Implementation status: Set July 5, 2024 as the base date for distribution, and July 29, 2024 as the payout date for distribution, with a cash dividend of NT$ 1.2 per share.

  • Major resolutions of Board Meetings as of 2024 and as of the publication date of this report:

    • a. 12nd meeting of the 12th term of the Board of Directors

Adopted the implementation report of the greenhouse gas inventory and verification schedule plan of the Company and all subsidiaries within the Group.

Adopted the report on the promotion and implementation of Company's sustainable development.

Adopted the 2023 Annual Report on the Performance Evaluation Results of the Company's Board of Directors and the Functional Committee

Adopted the Company's operating plan for 2024.

Adopted the proposal of the Company's compensation to employees and remuneration to directors for 2023.

Adopted the operating report and financial statement of the Company for 2023.

Adopted the distribution of earnings of the Company for 2023.

Adopted on the issuance of the benchmark date for the Company's first unsecured convertible corporate bonds into ordinary shares in the domestic market.

Adopted the date and place of the 2024 Annual Shareholders' Meeting and the acceptance of shareholder proposal rights.

Adopted the amendment to the Corporate Governance Best Practice Principles

Adopted the report on the reference items for the judgment of the effectiveness of the Company's internal control system for 2023 and the report on the

78

statement of internal control system for 2023.

Adopted the appointment and dismissal of CPAs and the independent and suitability assessment of CPAs in 2024.

  • b. 13th meeting of the 12th term of the Board of Directors

Adopted the repurchase of the Company's issued common stock.

  • c. 12th meeting of the 14th term of the Board of Directors

Adopted the report on the insurance status of Company's directors and supervisors.

Adopted the report on the implementation of the Company's treasury stocks.

Adopted the implementation report of the greenhouse gas inventory and verification schedule plan of the Company and all subsidiaries within the Group.

Adopted the financial report of the Company for Q1 2024.

  • d. 15th meeting of the 12th term of the Board of Directors

Adopted the implementation report of the greenhouse gas inventory and verification schedule plan of the Company and all subsidiaries within the Group.

Adopted the financial report of the Company for Q2 2024.

Adopted the repurchase of the Company's issued common stock.

  • e. 16th meeting of the 12th term of the Board of Directors

Adopted the proposed transfer of the Company's treasury shares to employees

  • f. 17th meeting of the 12th term of the Board of Directors

Adopted the implementation report of the greenhouse gas inventory and verification schedule plan of the Company and all subsidiaries within the Group.

Adopted the report on the implementation of the Company's treasury stocks.

Adopted the report on the professional qualifications and independence of the Company’s independent directors during the 2024 term.

Adopted the report on intelligent property for 2024.

Adopted the report on information security governance for 2024.

Adopted the implementation report on the Code of Ethical Corporate Management

Adopted the report on the communication between the Company and various stakeholders.

Adopted the proposal to change the Company's CPAs.

Adopted the financial report of the Company for Q3 2024.

Adopted the amendment to the Rules of Procedure for the Shareholders' Meeting.

Adopted the amendment to the "Audit Committee Charter"

Adopted the amendment to the "Information and Communication Security Operation Guidelines."

79

  • g. 18th meeting of the 12th term of the Board of Directors

Adopted the amendment to the Corporate Governance Best Practice Principles

Adopted the proposal to amend the operational items of the Company’s ―Internal Control System.‖

Adopted the proposal to establish the Company’s ―Sustainability Report Preparation and Assurance Procedures.‖

Adopted the Company's internal audit plan for 2025.

  • h. 19th meeting of the 12th term of the Board of Directors

Adopted the implementation report of the greenhouse gas inventory and verification schedule plan of the Company and all subsidiaries within the Group.

Adopted the report on the promotion and implementation of Company's sustainable development.

Adopted the 2024 Annual Report on the Performance Evaluation Results of the Company's Board of Directors and the Functional Committee

The Company plans to issue new shares through a share swap to acquire all the issued shares of Sentelic Corporation.

Adopted the Company's operating plan for 2025.

Adopted the proposal of the Company's compensation to employees and remuneration to directors for 2024.

Adopted the operating report and financial statement of the Company for 2024.

Adopted the distribution of earnings of the Company for 2024.

Adopted the scope definition for the Company's grassroots employees.

Adopted the amendment to the Articles of Association

Adopted the re-election proposal of the 13th term of directors of the Company.

Adopted the removal of the Company’s Non-compete Clause for directors

Adopted the date and place of the 2025 Annual Shareholders' Meeting and the acceptance of shareholder proposals and nomination rights.

Adopted the cash capital reduction for the Company's subsidiary, Weltrend International (BVI) Ltd.

Adopted the report on the reference items for the judgment of the effectiveness of the Company's internal control system for 2024 and the report on the statement of internal control system for 2024.

Adopted the appointment and dismissal of CPAs and the independent and suitability assessment of CPAs in 2025.

  • (X) Major contents of any dissenting opinions on record or stated in a written statement made by directors against major resolutions of the Board of Directors in the most recent fiscal year and as of the publication date of this report: None.

  • IV. CPA fees:

  • (I) The audit fees and non-audit fees paid to CPAs and their firms and affiliated companies and the content of non-audit services shall be disclosed. Specifically, the following items shall be disclosed:

80

Information on CPA fees

Unit: NT$thousand
Audit period
Audit feesNon-audit
fees
Total Note
2024.01.01~2024.12.31
4,470
554 5,024
-		 Unit: NT$thousand
Audit period
Audit feesNon-audit
fees
Total Note
2024.01.01~2024.12.31
4,470
554 5,024
-		 Unit: NT$thousand
Audit period
Audit feesNon-audit
fees
Total Note
2024.01.01~2024.12.31
4,470
554 5,024
-		 Unit: NT$thousand
Audit period
Audit feesNon-audit
fees
Total Note
2024.01.01~2024.12.31
4,470
554 5,024
-		 Unit: NT$thousand
Audit period
Audit feesNon-audit
fees
Total Note
2024.01.01~2024.12.31
4,470
554 5,024
-
Name of
accounting firm		 Name of CPA Audit period Audit fees Non-audit
fees
Total		 Note
Deloitte Taiwan Cheng-Chih Lin and
Chih-Yuan Wen, etc.		 2024.01.01~2024.12.31
4,470
554		 5,024
-

Non-audit fees: The non-audit fees refer to the Company's payment of tax case and document typing fees to CPAs. 

  1. If the accounting firm is changed and the audit fees paid for the fiscal year in which the change took place are lower than those paid for the fiscal year immediately preceding the change, the amount of the audit fees before and after the change and the reason shall be disclosed: None.

  2. If the audit fees paid for the current fiscal year are lower than those paid for the immediately preceding fiscal year by 10% or more, the amount and percentage of and reason for the reduction in audit fees shall be disclosed: None.

  • (II) The audit fees mentioned in the preceding paragraph refer to the fees paid by the Company to CPAs to check, review and verify the financial report and financial forecast.

  • V. Change of CPAs: If there is any change of CPAs in the last two years or the period thereafter, the following items shall be disclosed.

(I) About former CPAs:

(I)
About former CPAs:
Date of change March 31, 2023
Reason for change and description Internal business change
Describe whether the appointment is
terminated or not accepted by the
appointer or accountant		 Parties involved
Status
Certified Public
Accountant/CPA		 Appointer
Proactively terminate
appointment		 - -
No longer accept (continue)
appointment
-		 -
Opinions and reasons for audit reports
other than unqualified opinions issued
within the latest twoyears		 Issued unqualified opinions in 2022 and 2023
Is there any different opinion from the
issuer		 Yes Accounting principles orpractices
Disclosure of financial reports
Scope or steps of review
Others
None ˇ
Description
Other disclosures
(Items 4 to 7 of Article 10-6-1 of this
Code shall be disclosed)		 None

81

(II) About current CPAs:

(II) About current CPAs:
AccountingFirm Deloitte Taiwan
Name of CPA Cheng-Chih Lin and Pan-Fa Wang
Date of appointment March 31, 2023
Consultation on opinions and results of
accounting treatment methods or accounting
principles for specific transactions and possible
issuance of financial reports before appointment		 Not applicable
Written opinion of the current CPAs on matters
with different opinions from the former CPAs		 Not applicable

(III) Reply from the former CPAs to Paragraph 6-1 and Paragraph 6-2-3 of Article 10 of the Code.

(IV) About former CPAs:

Code.
(IV) About former CPAs:
Date of change
Reason for change and description
Describe whether the appointment is
terminated or not accepted by the
appointer or accountant
Opinions and reasons for audit reports
other than unqualified opinions issued
within the latest twoyears
Is there any different opinion from the
issuer
Other disclosures
(Items 4 to 7 of Article 10-6-1 of this
Code shall be disclosed)		 September 30, 2024
Internal business change
Parties involved
Status
Certified Public
Accountant/CPA		 Appointer
Proactively terminate
appointment		 - -
No longer accept (continue)
appointment
-		 -
Issued unqualified opinions in 2023 and 2024
Yes Accounting principles orpractices
Disclosure of financial reports
Scope or steps of review
Others
None ˇ
Description
None

(V) About current CPAs:

(V) About current CPAs:
AccountingFirm Deloitte Taiwan
Name of CPA Cheng-Chih Lin and Chih-Yuan Wen
Date of appointment September 30,2024
Consultation on opinions and results of
accounting treatment methods or accounting
principles for specific transactions and possible
issuance of financial reports before appointment		 Not applicable
Written opinion of the current CPAs on matters
with different opinions from the former CPAs		 Not applicable
  • (VI) Reply from the former CPAs to Paragraph 6-1 and Paragraph 6-2-3 of Article 10 of the Code.

82

  • VI. If the chairman, president, or finance or accounting managers of the Company worked in the CPA firm or an affiliate thereof within the most recent fiscal year, it shall disclose the name, title and the period of working in the CPA firm or its affiliate. An affiliate of the CPA firm refers to a company or organization in which the CPA of the CPA firm holds more than 50% of the shares or a majority of the directorships, or a company or organization listed as an affiliate in the information published or printed by the CPA firm: None.

  • VII. Changes in transfer or pledge of shares made by directors, supervisors, managers, and major shareholders holding more than 10% of Company shares in the most recent fiscal year and as of the publication date of this report: If the party of the share transfer or pledge is a related party, the name of such party, its relationship with the company, directors, managers and shareholders holding more than 10% of the shares, and the number of shares acquired or pledged shall be disclosed.

(I) Changes in shareholding of directors, managerial officers, and major shareholders:

Title Name 2024 2024 As of March 31 of the
currentyear		 As of March 31 of the
currentyear
Shareholding
increase
(decrease)
Pledged
shareholding
increase
(decrease)
Shareholding
increase
(decrease)
Pledged
shareholding
increase
(decrease)
Chairman and Chief
Investment Officer		 Sam Lin (1,637,000) 0 0 0
Director James Chou 0 0 0 0
Director Paul Liao 0 0 0 0
Director Jeff Tsai 0 0 0 0
Director and Chief
R&D Officer		 JC Liu 0 0 0 0
Director and Chief
Financial Officer as
well as Corporate
Governance Officer		 Cindy Guo 0 0 0 0
Director and CEO TonyLin (400,000) 0 0 0
Independent Director Gerald Kuo 0 0 0 0
Independent Director Wei-Kun Yeh 0 0 0 0
Independent Director Wen-TsungHsu 0 0 0 0
President DS Lin 0 0 0 0
Vice President of
Manufacturing		 Jesse Lu (Note 1)
0		 0 0 0
Chief Operation
Officer/COO		 Robby Tsai 0 0 0 0
Vice President of R&D
ST Kuo		 0 0 0 0
Vice President of
Product Development
and Technology
Application
Engineering		 Wayne Lo 15,000 0 (10,000) 0
Vice President of R&D
Vincent Lu		 15,000 0 0 0
AccountingSupervisor
Jason Wang		 0 0 0 0

Note 1: Jesse Lu was dismissed on April 25, 2024, and information after dismissal will not be disclosed.

83

(II) Information on share transfer:

Name
(Note 1)		 Reasons for
share
transfer
(Note 2)
Date of
transaction
Business
counterparties		 The relationship between the
business counterparties and
the company, directors,
supervisors, managers and
shareholders holding more
than 10% of the shares
Number of
shares
Trading
price
Sam Lin Disposal 2024.3.8 Nathan Lin Father and son 37,000
64.40
Sam Lin Disposal 2024.7.18 Bang-Tao
Investment
Co., Ltd.		 Chairman holds shares
under another person's name		 1,600,000
61.00
Tony Lin Disposal 2024.7.18 Bang-Tao
Investment
Co., Ltd.		 Director holds shares under
another person's name		 400,000
61.00

Note 1: The names of directors, supervisors, managers and shareholders holding more than 10% of the shares Note 2: Acquisition and disposal of shares.

  • (III) Information on share pledge: None.

  • VIII. Information on top 10 major shareholders who are related to one another or are related as spouses or within the second degree of kinship.

Information on the relationship among the top 10 major shareholders

NAME
(NOTE 1)		 PERSONAL
SHAREHOLDING		 PERSONAL
SHAREHOLDING		 SHARES HELD BY
SPOUSES AND
MINORS		 SHARES HELD BY
SPOUSES AND
MINORS		 SHARES HELD IN THE
NAME OF OTHERS		 SHARES HELD IN THE
NAME OF OTHERS		 NAMES AND RELATIONSHIP
BETWEEN THE TOP 10 MAJOR
SHAREHOLDERS OR
SPOUSES/RELATIVES WITHIN
THE SECOND DEGREE OF
KINSHIP(NOTE 3)		 NAMES AND RELATIONSHIP
BETWEEN THE TOP 10 MAJOR
SHAREHOLDERS OR
SPOUSES/RELATIVES WITHIN
THE SECOND DEGREE OF
KINSHIP(NOTE 3)		 NOTE
Number
of shares		 Shareholding
ratio		 Number
of shares		 Shareholding
ratio		 Number of
shares
Shareholding
ratio		 Name Relationship
Fufeng Investment
Co., Ltd.
Company
Representative:
Paul Liao		 4,783,049 2.69%
-		 - - - - - -
1,078,468 0.61%
-		 - - - - - -
Sam Lin 2,809,000 1.58% 155,982 0.09% 1,900,000 1.07% Bang-Tao
Investment Co.,
Ltd.		 person in
charge of the
company		 -
Bang-Tao
Investment Co., Ltd.
Company
Representative:
Sam Lin		 2,500,000 1.40%
-		 - - - Sam Lin Personal -
2,809,000 1.58%
James Chou 2,433,829 1.37%
-		 - - - - - -
JPMorgan Chase
Bank N.A. Taipei
Branch in Custody
for Vanguard Total
International Stock
Index Fund, a series
of Vanguard Star
Funds		 2,080,182 1.17%
-		 - - - - - -
JPMorgan Chase
Bank N.A. Taipei
Branch in Custody
for Vanguard
EmergingMarkets		 1,964,567 1.10%
-		 - - - - - -

84

NAME
(NOTE 1)		 PERSONAL
SHAREHOLDING		 PERSONAL
SHAREHOLDING		 SHARES HELD BY
SPOUSES AND
MINORS		 SHARES HELD BY
SPOUSES AND
MINORS		 SHARES HELD IN THE
NAME OF OTHERS		 SHARES HELD IN THE
NAME OF OTHERS		 NAMES AND RELATIONSHIP
BETWEEN THE TOP 10 MAJOR
SHAREHOLDERS OR
SPOUSES/RELATIVES WITHIN
THE SECOND DEGREE OF
KINSHIP(NOTE 3)		 NAMES AND RELATIONSHIP
BETWEEN THE TOP 10 MAJOR
SHAREHOLDERS OR
SPOUSES/RELATIVES WITHIN
THE SECOND DEGREE OF
KINSHIP(NOTE 3)

NOTE
Number
of shares		 Shareholding
ratio		 Number
of shares		 Shareholding
ratio		 Number of
shares
Shareholding
ratio		 Name Relationship
Stock Index Fund, a
Series of Vanguard
International Equity
Index Funds
Chongyou
Investment Co., Ltd.		 1,930,000
1.08%
-		 - - - - - -
JC Liu 1,808,013
1.02%
-		 - - - - - -
Cindy Guo 1,270,200
0.71%
-		 - - - - - -
Taiwan Advanced
Trust Company's
Great Trust Stock
Index II Investment
Trust		 1,138,000
0.64%
-		 - - - - - -

  • Note 1: All the top ten shareholders shall be listed. If they are corporate shareholders, their name and the names of their representatives shall be listed separately.

  • Note 2: The calculation of the percentage of shareholding refers to the percentage of shareholding in the name of oneself, one's spouse, one's minors, or in the name of others, respectively.

  • Note 3: The shareholders listed above include both legal and natural persons. The relationships between them shall be disclosed in accordance with the Rules Governing the Preparation of Financial Reports by Issuers.

  • IX. The number of shares held by the Company, its directors, supervisors, managers and businesses directly or indirectly controlled by the Company in the same reinvestment business and the percentage of shareholding are calculated as follows:

Unit: thousand shares; %

Reinvestment business
(Note)		 Investment by the
Company		 Investment by the
Company		 Direct or indirect ownership by
directors/supervisors/managers		 Direct or indirect ownership by
directors/supervisors/managers		 Portfolio investment Portfolio investment
Number of
shares		 Shareholding
ratio
Number of
shares		 Shareholding
ratio		 Number of
shares		 Shareholding
ratio
Weltrend International Co.,
(BVI)Ltd.		 8,164
100%
-
-
8,164		 100%
Yingquan Investment Co., Ltd. 32,416
98%
567
2%
32,983		 100%
Dongguan Prosil Electronics
Co., Ltd.		 -
100%
-
-
-		 100%
Sentelic Corporation 15,324
51%
-
-
15,324		 51%
Sentelic Holding Co.,Ltd. 625
100%
-
-
625		 100%

Note: The Company employed the equity method for long-term investments on December 31, 2024.

85

Chapter 3 Capital Overview

I. Capital and shares of the Company

(I) Sources of capital

Date Issue
price		 Authorized capital Authorized capital Paid-in capital Paid-in capital Note Note Note
Number of
shares		 Amount Number of
shares		 Amount Sources of capital Capital increase by
assets other than cash		 Date of approval and document
No.
1989.6 10 8,000,000
80,000,000
3,600,000
36,000,000
Establishment		 Technology pricing:
NT$3,600,000		 1989.7.5 (1989) Yuan-Jing-Zi No.
07331
1990.5 10 8,000,000
80,000,000
8,000,000
80,000,000		 Issuance of common stock for cash: NT$ 44,000,000 Technology pricing:
NT$4,400,000		 1990.05.29 (1990) Yuan-Jing-Zi
No. 05560
1991.4 11 20,000,000
200,000,000
12,000,000
120,000,000		 Issuance of common stock for cash: NT$ 40,000,000 None 1991.05.03 (1991) Yuan-Jing-Zi
No. 04640
1995.6 10 20,000,000
200,000,000
17,680,000
176,800,000
Surplus profit distributed in the form of new
shares: 48,000,000
Capitalization of employee bonus: 8,800,000		 None 1995.7.4 (1995) Yuan-Shang-Zi
No. 09476
1996.5 10 60,000,000
600,000,000
30,200,000
302,000,000
Surplus profit distributed in the form of new
shares: 109,616,000
Capitalization of employee bonus:
15,584,000		 None 1996.06.18 (1996) Yuan-Shang-Zi
No. 09625
1997.6 10 60,000,000
600,000,000
40,000,000
400,000,000
Surplus profit distributed in the form of new
shares: 84,560,000
Capitalization of employee bonus:
13,440,000		 None 1997.07.17 (1997) Yuan-Shang-Zi
No. 13772
1997.6 53 60,000,000
600,000,000
50,000,000
500,000,000		 Issuance of common stock for cash: NT$ 100,000,000
1998.6 10 120,000,000
1,200,000,000
72,000,000
720,000,000
Surplus profit distributed in the form of new
shares: 115,000,000
Capital surplus transferred to common stock:
85,000,000
Capitalization of employee bonus:
20,000,000		 None 1998.07.13 (1998) Yuan-Shang-Zi
No. 016810
1999.7 10 120,000,000
1,200,000,000
88,000,000
880,000,000
Surplus profit distributed in the form of new
shares: 72,000,000
Capital surplus transferred to common stock:
72,000,000
Capitalization of employee bonus:
16,000,000		 None 1999.08.13 (1999) Yuan-Shang-Zi
No. 017381

86

Date Issue
price		 Authorized capital Authorized capital Paid-in capital Paid-in capital Note Note Note
Number of
shares		 Amount Number of
shares		 Amount Sources of capital Capital increase by
assets other than cash		 Date of approval and document
No.
2000.8 10 120,000,000
1,200,000,000
117,700,000
1,177,000,000
Surplus profit distributed in the form of new
shares: 220,000,000
Capital surplus transferred to common stock:
44,000,000
Capitalization of employee bonus:
33,000,000		 None 2000.08.17 (2000) Yuan-Shang-Zi
No. 017790
2000.10 10 158,000,000
1,580,000,000
121,100,000
1,211,000,000		 Capital increase in connection with a merger:
34,000,000		 None 2000.10.16 (2000) Yuan-Shang-Zi
No. 023334
2001.7 10 219,600,000
2,196,000,000
161,400,000
1,614,000,000
Surplus profit distributed in the form of new
shares: 339,080,000
Capitalization of employee bonus:
63,920,000		 None 2001.07.20 (2001) Yuan-Shang-Zi
No. 018238
2002.9 10 219,600,000
2,196,000,000
189,600,000
1,896,000,000
Surplus profit distributed in the form of new
shares: 193,680,000
Capital surplus transferred to common stock:
48,420,000
Capitalization of employee bonus:
39,900,000		 None 2002.09.10 (2002) Yuan-Shang-Zi
No. 0910022422
2003.8 10 219,600,000
2,196,000,000
216,300,000
2,163,000,000
Surplus profit distributed in the form of new
shares: 189,600,000
Capital surplus transferred to common stock:
37,920,000
Capitalization of employee bonus:
39,480,000		 None 2003.08.15 (2003) Yuan-Shang-Zi
No. 0920022569
2004.8 10 273,200,000
2,732,000,000
233,000,000
2,330,000,000
Surplus profit distributed in the form of new
shares: 129,780,000
Capitalization of employee bonus:
37,220,000		 None 2004.08.12 (2004) Yuan-Shang-Zi
No. 0930022213
2004.11 - 273,200,000
2,732,000,000
225,000,000
2,250,000,000		 Buying-back of shares for capital reduction:
80,000,000		 None 2004.11.29 (2004) Yuan-Shang-Zi
No. 0930033041
2005.3 - 273,200,000
2,732,000,000
220,000,000
2,200,000,000		 Buying-back of shares for capital reduction:
50,000,000		 None 2005.3.4 (2005) Yuan-Shang-Zi
No. 0940005059
2007.4 - 273,200,000
2,732,000,000
217,000,000
2,170,000,000		 Buying-back of shares for capital reduction:
30,000,000		 None 2007.04.04 (2007) Yuan-Shang-Zi
No. 0960008049
2007.8 - 273,200,000
2,732,000,000
223,510,000
2,235,100,000		 Capital surplus transferred to common stock:
65,100,000		 None 2007.08.28 (2007) Yuan-Shang-Zi
No. 0960023210
2008.8 10 330,000,000
3,300,000,000
246,800,000
2,468,000,000
Surplus profit distributed in the form of new
shares: 201,159,000
Capitalization of employee bonus:
31,741,000		 None 2008.08.28 (2008) Yuan-Shang-Zi
No. 0970023940

87

Date Issue
price		 Authorized capital Authorized capital Paid-in capital Paid-in capital Note Note Note
Number of
shares		 Amount Number of
shares		 Amount Sources of capital Capital increase by
assets other than cash		 Date of approval and document
No.
2013.2 - 330,000,000
3,300,000,000
246,000,000
2,460,000,000		 Buying-back of shares for capital reduction:
8,000,000		 None 2013.02.05 (2013) Yuan-Shang-Zi
No. 1020004410
2013.8 330,000,000
3,300,000,000
221,400,000
2,214,000,000		 Capital reduction: NT$ 246,000,000 None 2013.08.15 (2013) Yuan-Shang-Zi
No. 1020024483
2016.8 - 330,000,000
3,300,000,000
222,020,000
2,220,200,000		 Restricted stock for employees: 6,200,000 None 2016.8.18 (2016) Zhu-Shang-Zi
No. 1050023044
2017.4 - 330,000,000
3,300,000,000
222,600,000
2,226,000,000		 Restricted stock for employees: 5,800,000 None 2017.04.27 (2017) Zhu-Shang-Zi
No. 1060010911
2017.11 - 330,000,000
3,300,000,000
222,573,000
2,225,730,000		 Cancel the restricted stock for employees:
270,000		 None 2017.11.16 (2017) Zhu-Shang-Zi
No. 1060031382
2018.5 - 330,000,000
3,300,000,000
222,559,000
2,225,590,000		 Cancel the restricted stock for employees:
140,000		 None 2018.05.14 (2018) Zhu-Shang-Zi
No. 1070014167
2018.8 - 330,000,000
3,300,000,000
178,044,400
1,780,444,000		 Capital reduction: NT$ 445,146,000 None 2018.08.14 (2018) Zhu-Shang-Zi
No. 1070023478
2019.5 - 330,000,000
3,300,000,000
178,014,441
1,780,144,410		 Cancel the restricted stock for employees:
299,590		 None 2019.05.13 (2019) Zhu-Shang-Zi
No. 1080012988
2020.3 - 330,000,000
3,300,000,000
178,009,961
1,780,099,610		 Cancel the restricted stock for employees:
44,800		 None 2020.03.03 (2020) Zhu-Shang-Zi
No. 1090005867
2024.3 10 330,000,000
3,300,000,000
178,011,594
1,780,115,940		 Convertible bonds converted into ordinary
shares: 16,330		 None 2024.03.08 (2024) Zhu-Shang-Zi
No. 1130007104

Information on the general reporting system: None.

Type of shares Authorized capital Authorized capital Authorized capital Note
Issued shares Unissued shares Total
Common stock 178,011,594
151,988,406
330,000,000
Listed company stock

88

(II) List of major shareholders

List of major shareholders List of major shareholders List of major shareholders
March 31,2025
Shares
Name of major shareholder		 Number of
shares held		 Shareholding
ratio
Fufeng Investment Co., Ltd. 4,783,049 2.69%
Sam Lin 2,809,000 1.58%
Bang-Tao Investment Co., Ltd. 2,500,000 1.40%
James Chou 2,433,829 1.37%
JPMorgan Chase Bank N.A. Taipei Branch in Custody
for Vanguard Total International Stock Index Fund, a
series of Vanguard Star Funds		 2,080,182 1.17%
JPMorgan Chase Bank N.A. Taipei Branch in Custody
for Vanguard Emerging Markets Stock Index Fund, a
Series of Vanguard International EquityIndex Funds		 1,964,567 1.10%
Chongyou Investment Co., Ltd. 1,930,000 1.08%
JC Liu 1,808,013 1.02%
CindyGuo 1,270,200 0.71%
Taiwan Advanced Trust Company's Great Trust Stock
Index II Investment Trust		 1,138,000 0.64%

  • (III) Dividend Policy and Implementation Status

  • Dividend Policy:

The Company must consider the soundness and stability of its financial structure for the distribution of dividends. It shall also determine the ratio of the cash dividends and stock dividends distributed in the current year based on requirements for the Company's growth. The distribution of earnings for the current year shall be based on the principle of no less than fifty percent (50%) of the accumulated distributable earnings, and the distribution ratio of cash dividends shall no less than ten percent (10%) of the total dividends.

  1. Proposed dividend distribution for the current year:

The Company's 2024 distribution plan for earnings was adopted by the board meeting on March 7, 2025. The Board of Directors, in accordance with the provisions of the Company's Articles of Association, resolved to distribute a cash dividend of NT$ 1.5 per share, totaling NT$ 262,469,319.

  • (IV) The impact of the gratuitous allotment of shares proposed at this Shareholders' Meeting on the Company's operating performance and earnings per share: None.

  • (V) Remuneration for employees and directors:

  • Percentage or range of remuneration for employees and directors as set out in the Articles of Association:

The Company shall allocate 11% to 15% of the Company's pre-tax profit of the current period before deducting the employees' remuneration and Directors' remuneration of the year as employees' remuneration and no more than 4% as Directors' remuneration. However, if the Company has accumulated losses (including adjustment on non-distributed earnings), the Company shall set aside a part of the profit first to make up for the losses.

89

The remuneration in the preceding paragraph shall be in stock or cash and shall include the employees of the subsidiaries who meet the conditions set by the Board of Directors. The Directors' remuneration specified in the preceding paragraph shall only be distributed in cash.

The procedures in the two preceding paragraphs must be approved by the Board of Directors and reported to the shareholders' meeting.

  1. Basis for estimating the amount of remuneration for employees and directors, basis for calculating the number of shares to be distributed as stock dividends, and accounting treatment for any differences between the actual amounts distributed and the estimated amounts:

If there is a significant change in the amount of payment resolved by the Board of Directors prior to the date of approval of the annual financial report, the change shall be considered as the annual expense. If there is still a change in the amount after the date of approval of the annual financial report, the change shall be treated as a change in accounting estimate and recorded in the following year.

The estimated amount of employee compensation and directors' compensation at the end of 2024 is the same as the amount resolved by the Board of Directors on March 7, 2025.

  1. The distribution of remuneration approved by the Board of Directors:

  2. a. Distribute employees and directors' compensation in cash or stock. If there is any discrepancy between the amount recognized and the amount estimated in the year of expense recognition, the amount of the discrepancy, the reason for the discrepancy, and the treatment therefore shall be disclosed:

On March 7, 2025, the Board of Directors decided to allocate NT$ 44,964,742 to employees and NT$ 11,241,185 to directors. There are no discrepancies between the employees' remuneration and Directors' remuneration and the amount estimated in 2024.

  • b. Amount of Employee Compensation Distributed in Stock and its Proportion to the Aggregate Amount of Net Income After Tax and Total Employee Compensation in the Parent Company Only or Individual Financial Statements for the Period: None.

  • Information on Distribution of Compensation of Employees, Directors, and Supervisors (With an Indication of the Number of Distributed Shares, Monetary Amount, and Stock Price) And, If There Is Any Discrepancy Between the Actual Distribution and the Recognized Employee, Director, or Supervisor Compensation, Additionally the Discrepancy, Cause, and How It Is Treated:

In 2023, the Company allotted NT$33,328,484 in cash dividends to employees and NT$8,332,120 in remuneration to directors and supervisors. The actual allotment was not different from the proposed allotment approved by the Board of Directors.

(VI) Share Repurchases:

  1. Shares repurchased:
Repurchases:
Shares repurchased:
Term of buyback 9th (term)
Purpose of buyback Transfer of shares to employees
Buyback period 2021.11.8~2021.12.30
Range of price 65~110
Type and number of shares repurchased Common shares: 1,500,000

90

Term of buyback 9th (term)
Amount of shares repurchased NT$138,234,997
Percentage of repurchased quantity to scheduled
repurchasequantity(%)		 100%
Number of shares eliminated and transferred 595,000 shares
Cumulative number of shares 905,000 shares
Ratio of cumulative number of shares held to
total number of shares issued (%)		 0.51%
Term of buyback 10th (term)
Purpose of buyback Transfer of shares to employees
Buyback period 2024.4.18~2024.4.25
Range of price 62~75
Type and number of shares repurchased Common shares: 1,000,000
Amount of shares repurchased NT$60,682,106
Percentage of repurchased quantity to scheduled
repurchasequantity(%)		 100%
Number of shares eliminated and transferred 0 share
Cumulative number of shares 1,905,000 shares
Ratio of cumulative number of shares held to
total number of shares issued (%)		 1.07%
Term of buyback 11th (term)
Purpose of buyback Transfer of shares to employees
Buyback period 2024.8.9~2024.8.15
Range of price 45~65
Type and number of shares repurchased Common shares: 1,200,000
Amount of shares repurchased NT$66,985,745
Percentage of repurchased quantity to scheduled
repurchasequantity(%)		 100%
Number of shares eliminated and transferred 73,000 shares
Cumulative number of shares 3,032,000 shares
Ratio of cumulative number of shares held to
total number of shares issued (%)		 1.70%
  1. Shares under repurchase: None.

91

II. Insurance of corporate bonds (including overseas corporate bonds):

(I) Outstanding Corporate Bonds:

(I)
OutstandingCorporate Bonds:		 (I)
OutstandingCorporate Bonds:
Type of corporate bond Domestic unsecured convertible corporate bonds
(first issuance)
Date of Issuance September 11,2023
Face Value Each bond has a face value of NT$100,000
Place of Issuance and Trading -
Issueprice Accordingto 112.15% of the face value
Total Amount NT$1,100,000,000
Interest Rate Coupon Rate: 0%per annum
Term Maturity: 3 years, with maturity date on
September 11,2026
Guarantee Institution Not applicable
Trustee Taishin International Bank
UnderwritingInstitution Taishin Securities Co.,Ltd.
Lawyer Charles Ya-Wen Chiu
CPA Deloitte Taiwan
Repayment Method The outstanding principal will be repaid in cash in
full, based on the face value of the bond upon
maturity.
OutstandingPrincipal NT$1,099,900 thousand
Redemption or Early Repayment
Provisions		 Please refer to the terms and conditions outlined in
the issuance and conversionprocedures
Restrictive covenants Not applicable
Credit Rating Agency Name, Rating Date,
Corporate Bond
Assessment outcome
Not applicable
Other
Rights
Attached		 The amount converted
(exchanged or subscribed) into
common shares, overseas
depositary receipts, or other
securities as of the printing
date of the annual report.
As of March 31, 2025, 1 bond has been converted,
with a total face value of NT$100 thousand,
converted into 1,633 common shares.
Issuance or Conversion
(Exchange or Subscription)
Procedure		 Please refer to the terms and conditions outlined in
the issuance and conversion procedures
The issuance and conversion, exchange,
or subscription procedures, issuance
conditions, potential dilution of equity,
and impact on existing shareholders'
equity		 Based on the current conversion price of NT$60.1,
the maximum dilution effect of the convertible
bonds issued in this round on existing
shareholders is estimated to be approximately
10.28%. However, the dilution effect of
convertible bonds on equity depends on the
conversion situation and occurs gradually, thereby
having a mitigating effect. Therefore, overall, the
dilution impact on equity is considered to be
limited.
Name of Custodian Institution for
Exchange Targets		 Not applicable

(II) Outstanding corporate bonds: None.

92

(III) Conversion of corporate bond information:

Conversion of corporate bond information: Conversion of corporate bond information:
Type of corporate bond Domestic unsecured convertible corporate
bonds(first issuance)
Items Year
2024		 As of
March 31, 2025
Conversion of corporate
bond market value		 Highest 123 115.35
Lowest 105.2 107.25
Average 115.62 111.08
Conversion price 60.1 60.1
Issue date and conversion price at
issuance		 September 11, 2023
NT$61.2
Method of Fulfilling Conversion
Obligations		 Issuance of New Shares

  • III. Insurance of preferred shares: None.

  • IV. Overseas depositary receipts: None.

  • V. Insurance of employee stock options: None.

  • VI. Restricted stock for employees: None.

VII. Issuance of new shares in connection with mergers or acquisitions or with acquisitions of shares of other companies

  • (I) Mergers or acquisitions, or issuances of new shares for acquiring shares of other companies, completed during the most recent fiscal year and up to the date of publication of this annual report: None.

  • (II) During the most recent fiscal year and up to the date of publication of this annual report, the Board of Directors has approved mergers or acquisitions, or issuances of new shares for acquiring shares of other companies

  • Implementation status:

    • a. In line with the Company’s long-term development strategy, the Company and its 51.04%-owned subsidiary, Sentelic Corporation (hereinafter referred to as ―Sentelic ‖), respectively resolved at their board meetings held on March 7, 2025, to proceed with a merger through a share swap. Sentelic plans to submit the share swap proposal for approval at its shareholders’ meeting scheduled for May 26, 2025. The Company intends to conduct the share swap by issuing new shares in exchange for 100% of the issued shares of Sentelic (hereinafter referred to as the ―Share Swap Transaction‖). Upon completion of the Share Swap Transaction, Sentelic will become a wholly owned subsidiary of Weltrend Semiconductor, Inc. Through this transaction, the Company aims to integrate resources, expand operational scale, and enhance market competitiveness.

    • b. Under the Share Swap Transaction, each common share of Sentelic will be exchanged for 1.60 newly issued common shares of the Company as consideration (subject to adjustments, if any, as stipulated in the Share Swap Agreement). The Company plans to increase its capital by issuing 23,516,480 new common shares to the shareholders of Sentelic, excluding the Company itself, based on the shareholding on the share swap reference date. These new shares will have the same rights and obligations as the Company’s existing

93

issued common shares. However, the final number of new shares to be issued shall be calculated based on the total number of issued common shares of Sentelic as of the share swap reference date, minus any Sentelic common shares that must be canceled pursuant to the share swap reference date or other applicable laws, and minus the shares held by the Company. The resulting number will then be multiplied by the share exchange ratio under the Share Swap Transaction. Following approval of the Share Swap Transaction at Sentelic's shareholders’ meeting and upon receipt of approvals from the relevant competent authorities, the share swap reference date is tentatively scheduled for September 8, 2025.

  • c. The Share Swap Transaction is subject to the approval of the competent authorities before the share exchange process can proceed. Upon completion of the Share Swap Transaction, Sentelic will become a wholly owned subsidiary of the Company and will be delisted from the Taipei Exchange (TPEx). (Sentelic plans to seek approval of the Share Swap Transaction at its shareholders’ meeting on May 26, 2025. Following receipt of approval from the relevant competent authorities, Sentelic will apply, in accordance with applicable regulations, to the Taipei Exchange for the termination of the trading of its securities on the over-the-counter market, and will also apply to the Financial Supervisory Commission for the termination of its status as a public company).

  • Basic Information Table of the Acquired and Transferred Company

2. Basic Information Table of the 2. Basic Information Table of the Acquired and Transferred Company
Company name Sentelic Corporation
Company address 6F.,No.88, Zhouzi St., Neihu District, Taipei City 11493,
Taiwan
Responsibleperson Sam Lin
Paid-in capital NT$300,218,000
Main business activities: Integrated circuit (IC) development and design, analog
circuit design, digital signal processing, and application
software development.
Main products Fan motor driver controller: Server hosts and power
supplies, telecommunications equipment, data center
power supplies, network switches and routers, high-end
gaming graphics cards, liquid-cooled fans for gaming
PCs, uninterruptible power systems (UPS), home
appliances, EV charging stations, solar power inverters,
miningmachines,AI servers,and liquid cooling pumps.
Financial data for
the most recent
fiscal year		 Total assets NT$853,505,000
Total liabilities NT$155,003,000
Total shareholders' equity NT$698,502,000
Net sales NT$465,932,000
Gross profit NT$202,413,000
Operation profit and loss NT$60,893,000
Profit or loss NT$96,887,000
Earnings per share NT$3.23

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3. Impact on shareholder equity

In August 2022, the Company acquired a 51.04% stake in Sentelic through a public tender offer, marking the first phase of the merger between the two companies. After more than two years of collaboration, both teams have integrated research and development resources, product portfolios, sales channels, and back-end operations, with preliminary synergies already visible. Due to the significant complementary effects in technology and products, the combined entity is able to offer a more comprehensive product lineup and solutions. Furthermore, with an expanded customer base, the Company has become a global leader in the field of server fan motor control chips. Therefore, on March 7, 2025, the Board of Directors of both companies resolved to proceed with the merger. The Company intends to increase its capital by issuing new shares to Sentelic, enabling both companies to leverage group resources for further economies of scale, enhanced operational efficiency, and strengthened integration synergies. This will allow both companies to continue enhancing their competitiveness in the rapidly evolving and highly competitive global semiconductor market, creating a win-win outcome for shareholders, customers, and employees.

VIII. Implementation of capital utilization plan:

  • (I) Content of Capital Utilization Plan:

As of one quarter prior to the publication date of the Annual Report, previous offerings or private placements of securities have not been completed, or have been completed within the last three years and the planned benefits have not been realized: None.

  • (II) Implementation status: None.

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Chapter 4 Operating Status

  • I. Business Activities

  • (I) Scope of business

    1. Main content of the Company's business:

Research, develop, manufacture, test and sell integrated circuit products for various applications.

  1. Proportion of main product sales:
pe of business
Main content of the Company's business:
Research, develop, manufacture, test and sell integrated circuit products for various
applications.
Proportion of main product sales:		 pe of business
Main content of the Company's business:
Research, develop, manufacture, test and sell integrated circuit products for various
applications.
Proportion of main product sales:		 pe of business
Main content of the Company's business:
Research, develop, manufacture, test and sell integrated circuit products for various
applications.
Proportion of main product sales:
Unit: NT$thousand
Main products Amount of operating
revenue in 2024		 Proportion of
Business
Power and analog 1,253,744 41%
Smart applications 852,969
27%
Sales of electronic components 987,906
32%
Total 3,094,619
100%

  1. Current products (services):

  2. a. Self-developed, produced and sold products: power management and analog ICs, smart application ICs.

  3. b. Concurrent business: integrated application and sales of international famous brand electronic components.

  4. Planned new products (services):

  5. a. Power management and analog ICs:

    • USB Type-C PD (Power Delivery), and other protocol controllers, primary-side PWM power control ICs, and synchronous rectification control ICs for USB Type-C wall chargers, car chargers, and power banks. In response to the trend towards high efficiency and miniaturization of chargers, the Company will also collaborate with Gallium Nitride (GaN) or MOSFET manufacturers to introduce highly integrated System-in-Package (SiP) encapsulated products. The Company will also develop more energy-efficient products to meet the latest energy efficiency regulations.

    • Developed a USB Type-C PD control chip for use in devices such as laptops.

    • Secondary-side supervisor ICs for switched power supply (SPS).

  6. b. Smart application ICs:

  7. Air cooling solutions, such as highly integrated smart fan motor driver and controller.

  8. Liquid cooling solutions, such as pump motor controller, leakage detection ICs, and water gate controller.

  9. A series of general-purpose 8-bit and 32-bit microcontrollers.

  10. c. Customer-specific customized IC (ASIC)

These are specialized and exclusive products tailored to meet the specific requirements of customers. After registration, they will be classified according to product attributes into either power and analog or smart applications.

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  • (II) Industry overview

  • Current situation and development of the industry:

According to the Industrial Technology Research Institute (ITRI) of Taiwan, the estimated output value of Taiwan's IC industry in 2024 is expected to reach NT$531.51 billion (USD$165.6B), a 22.4% increase compared to 2023. Among this, the output value of the IC design sector is NT$127.21 billion (USD$39.6B), growing by 16.0% from 2023; the IC manufacturing sector is NT$341.95 billion (USD$106.5B), growing by 28.4% from 2023, with wafer foundry accounting for NT$324.38 billion (USD$101.1B), growing by 30.1% from 2023, and memory and other manufacturing reaching NT$17.57 billion (USD$5.5B), growing by 3.3% from 2023. The IC packaging sector is NT$42.33 billion (USD$13.2B), growing by 7.7% from 2023; the IC testing sector is NT$20.02 billion (USD$6.2B), growing by 5.0% from 2023.

According to World Semiconductor Trade Statistics (WSTS), the total revenue of the global semiconductor market in 2024 was $627.6 billion, which was a 19.1% growth compared to 2023, marking a rebound after the downturn in 2023. Looking back at the semiconductor industry in recent years, it experienced a historic peak in 2021 due to the pandemic-driven demand for personal and household electronics, with both volume and prices rising due to material shortages. Starting in the second half of 2022, however, the industry entered a period of inventory adjustment, driven by factors such as inflation, war, and the normalization of post-pandemic life and work, which led to a sharp decline in end-user demand. This inventory adjustment lasted for almost a year and a half. In 2024, however, strong growth was fueled by the AI boom. Taiwan's IC design industry, as mentioned earlier, saw a 16% growth in 2024, driven by a low base and the gradual recovery of the end-user electronics market.

The statistics and estimated output value of Taiwan's IC industry in 2024 are shown in the following table

the AI boom. Taiwan's IC design industry, as mentioned earlier, saw a 16% growth
in 2024, driven by a low base and the gradual recovery of the end-user electronics
market.
The statistics and estimated output value of Taiwan's IC industry in 2024 are shown
in the following table		 the AI boom. Taiwan's IC design industry, as mentioned earlier, saw a 16% growth
in 2024, driven by a low base and the gradual recovery of the end-user electronics
market.
The statistics and estimated output value of Taiwan's IC industry in 2024 are shown
in the following table		 the AI boom. Taiwan's IC design industry, as mentioned earlier, saw a 16% growth
in 2024, driven by a low base and the gradual recovery of the end-user electronics
market.
The statistics and estimated output value of Taiwan's IC industry in 2024 are shown
in the following table		 the AI boom. Taiwan's IC design industry, as mentioned earlier, saw a 16% growth
in 2024, driven by a low base and the gradual recovery of the end-user electronics
market.
The statistics and estimated output value of Taiwan's IC industry in 2024 are shown
in the following table
Unit: NT$100 million
2023 2024 Annual
growth
Output value of IC design
industry		 10,965 12,721 16.0%
Output value of IC manufacturing
industry		 26,626 34,195 28.4%
Output value of IC packaging
industry		 3,931 4,233 7.7%
Output value of IC test industry 1,906 2,002 5.0%
Total output value 43,428 53,151 22.4%

(Source: TSIA; ISTI of ITRI, February 2025)

Looking ahead to 2025, the continued growth in demand for AI and high-performance computing, the increasing demand for AI PC upgrades, the technological advancements in networking equipment, and the rising penetration of Wi-Fi 7, along with the ongoing recovery of the end-user electronics market, are all expected to contribute to the growth of the IC design industry. ITRI Industrial Economics and Knowledge Center estimates that the output value of Taiwan's IC

97

industry in 2025 will be approximately NT$6.18 trillion, representing a year-on-year growth of 16.2%. Among this, the IC design sector is expected to reach an output value of approximately NT$1.42 trillion, growing by 11.3% year-on-year, maintaining double-digit growth.

  1. The relationship between the upstream, mid-stream and downstream of the industry:

Taiwan has a sound division of labor system in IC industry. Its design, manufacturing, packaging, testing play a pivotal role in the supply chain of the global electronics industry. The IC design industry leads the planning, R&D, application and sales of IC products, serving as an important bridge between the semiconductor industry and the electronic product industry. The relationship between the upstream, mid-stream and downstream of the industry:

  • The upstream of IC design industry involves wafer, packaging, testing and other cooperative OEMs. Our main strategic partners are the world's leading wafer fabs. Almost all of our packaging is done by professional packaging companies in Taiwan, and most of testing is done by ourselves.

  • IC design provides product planning, development, sales and technical services. Midstream involves the application solution providers and agents, responsible for promoting IC products to the client side. Our agents are classified according to the product characteristics, and we select suitable agents based on the marketing ability, technical support and other professional abilities.

  • The downstream of the IC design industry involves the clients who buy ICs, i.e. users of ICs. Usually, they are electronic product manufacturers who assemble and integrate ICs into the finished products.

  • Various development trends and competition faced by products:

In recent years, the hot fields in the electronics industry include high-performance computing, network communications, audio-visual multimedia, storage memory devices, network communication, audio-visual multimedia, storage and memory devices, artificial intelligence, Internet of Things, smart power supply, sports monitoring watches and bracelets, mobile payment, advanced driver assistance systems, etc. Moreover, each of these fields can integrate artificial intelligence (AI) functionality, enabling devices to possess learning and problem-solving capabilities. With many years of experience, our products focus on power, video, motor control, consumer electronics and other fields. In a broad sense, our products can be categorized into the current hot fields such as power management, smart vision, and intelligent control, which are in line with the current global development trend. The specific examples are as follows:

  • a. Power management: Switched power supplies for desktop computers, servers, game consoles, and fast-charging chargers for mobile phones, tablets, laptops, game consoles, etc., which support USB Type-C PD or Qualcomm Quick Charge 3+/4/4+/5/5+.

  • b. Smart vision: Smart camera processing ICs with image detection and identification and AI technology can be applied to advanced driver assistance systems (ADAS), security or smart production. We also have ISP ICs for automotive, industrial control, and consumer product lenses and ICs for projectors with intelligent auto adjustment function.

  • c. Smart controller: Thermal solutions include air cooling solutions such as smart fan motor driver and controller, as well as liquid cooling solutions such as

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pump motor controller. These are primarily applied in servers (including AI servers), 5G base stations, charging piles, solar power inverters, mining machines, graphics cards, etc. ICs for POS payment, and various 8-bit or 32-bit MCUs.

All of the above are the current hot areas, with large development potential. However, electronic products are rapidly evolving, and IC designers not only have to quickly develop the products required by the market, but also have to invest heavily in technical manpower and R&D material costs, making competition very fierce. With the advantages of functional differentiation, excellent quality, reasonable price, stable delivery, our products won the recognition of clients.

  • (III) Technology and R&D overview

  • R&D expenditures in the most recent year and up to the publication date of the Annual Report:

A total of NT$445,441 thousand was spent on R&D in 2024.

  1. Developed successful technologies or products:

Up to now, the Company has a total of 277 approved and pending patent applications. The technologies or products that have been successfully developed are described as follows:

  • a. Power and analog

  • Supervisor ICs for secondary-side monitoring power supply: We provide a series of ICs for the power supplies of personal computers, servers, and game consoles. These ICs are widely used by domestic and foreign power supply manufacturers. The programmable function of the latest generation of digital power supervisor ICs allows clients to design more flexible products, help clients shorten development cycle and lower development risks.

  • USB PD and other fast-charging control ICs: Suitable for USB Type-C connector chargers, support fast-charging function, the whole series of ICs have passed the USB-IF certification and have been adopted by many international manufacturers of notebook computer and mobile phones. With the evolution of USB PD specifications, we have successfully developed a series of products with the latest USB PD 3.1 specifications ahead of the industry. We also have fast-charging ICs for cell phones and tablets with specifications such as Qualcomm Quick Charge and proprietary fast-charging specifications for well-known Chinese cell phone brands. Among them, Qualcomm Quick Charge 3+/4/4+/5/5+ control IC is the first Qualcomm-certified and mass-produced IC in the world.

  • Primary-side PWM power control ICs: We provide PWM (pulse width modulation) and synchronous rectification (SR) control ICs for switching power supply. which include comprehensive power protection features and control modes to enhance system efficiency. Our ICs also support GaN or MOSFET co-packaging for increased performance. The Company will also develop more energy-efficient products to meet the latest energy efficiency regulations. At present, a series of reference designs compatible with USB Type-C PD and Quick Charge fast charging have been successfully completed. These designs assist power supply designers in developing high-performance and highly reliable power products in the shortest possible time, and have already been successfully introduced into mass production.

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b. Smart applications

  • Advanced driver assistance system (ADAS): The around view monitor (AVM) and smart camera ICs are used in the vehicle safety assistance system, with the functions of 360-degree panoramic view, road drift warning, motion detection and blind spot detection to reduce the blind spot and improve driving safety. In response to the needs of intelligent projectors, we have developed ICs for projectors with intelligent auto adjustment function. 

  •  - ISP ICs for automotive, industrial control, and consumer product lenses.

    • Magnetic stripe decoder ICs, interface ICs, and QR Code Reader ICs for POS devices.

    • Cooling chips used in 5G servers, base stations, charging piles, solar power inverters, mining machines, and graphics cards. These include high-integration intelligent fan motor driver and controller for air-cooling solutions, as well as pump motor control, leak detection, and water gate control ICs for liquid-cooling solutions.

    • A series of general-purpose 8-bit and 32-bit MCUs: Continuous development of highly-integrated single chips for small home appliances, motors, toys, game input devices, USB keyboards, mice, etc.

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

  • Continuous development of new products

Short-term: Constantly improve the function and yield of existing products to strengthen product competitiveness. The product lines for Japanese companies also constantly develop new products to facilitate the promotion of the Company.

Long-term: To align with the upcoming market trends, our plan is to develop a range of products that leverage our existing technology and product base. The specific plans are as follows:

  • a. Power management and analog ICs:

  • USB Type-C PD (Power Delivery), and other protocol controllers, primary-side PWM power control ICs, and synchronous rectification control ICs for USB Type-C wall chargers, car chargers, and power banks. In response to the trend towards high efficiency and miniaturization of chargers, the Company will also collaborate with GaN or MOSFET manufacturers to introduce highly integrated System-in-Package (SiP) encapsulated products.

  • Developed a USB Type-C PD control chip for use in devices such as laptops.

  • Secondary-side supervisor ICs for switched power supply (SPS).

  • Battery management chip.

  • b. Smart application ICs:

  • High-integration intelligent fan motor driver and control ICs for air-cooling solutions.

  • ICs for liquid-cooling solutions, including pump motor control, leak detection, and water gate control.

  • A series of general-purpose 8-bit and 32-bit microcontrollers.

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  • c. Customer-specific customized IC (ASIC)

These are specialized and exclusive products tailored to meet the specific requirements of customers. After registration, they will be classified according to product attributes into either power and analog or smart applications.

  1. Continuous expansion of new markets

Short-term: Stabilize the existing client base, constantly introduce new models; develop new client base, and actively promote our products.

Long-Term: Actively expand client base, strengthen and expand cooperation with agents, and contact more with international manufacturers, exploring emerging markets such as India and Vietnam, and further pursuing business opportunities with international end customers.

  • II. Market, production, and marketing overview

  • (I) Market analysis:

Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our products cover all major international brands in the world. In the past two years, the sales proportion by region is as follows:

et, production, and marketing overview
Market analysis:
Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our
products cover all major international brands in the world. In the past two years, the
sales proportion by region is as follows:		 et, production, and marketing overview
Market analysis:
Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our
products cover all major international brands in the world. In the past two years, the
sales proportion by region is as follows:		 et, production, and marketing overview
Market analysis:
Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our
products cover all major international brands in the world. In the past two years, the
sales proportion by region is as follows:		 et, production, and marketing overview
Market analysis:
Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our
products cover all major international brands in the world. In the past two years, the
sales proportion by region is as follows:		 et, production, and marketing overview
Market analysis:
Our products are mainly sold in Taiwan, China, South Korea, Southeast Asia. Etc. Our
products cover all major international brands in the world. In the past two years, the
sales proportion by region is as follows:
Unit: NT$ thousand
Year
Country/region
2023		 2024
Amount Amount Amount Proportion (%)
Taiwan 695,612
24%
665,425
22%
China 2,099,268
73%
2,306,337
74%
Other countries 90,680
3%
122,857
4%
Total 2,885,560
100%
3,094,619
100%

In terms of self-developed products, our two product lines have been developed in a balanced manner and our product structure is quite sound. The market share and future supply and demand of the Company, its subsidiary Dongguan Prosil Electronics Co., Ltd., and the newly acquired Sentelic Corporation, are described as follows:

  • Power management and analog ICs:

  • a. Our secondary-side monitoring power supervisor ICs have the world's largest market share in SPS for PC and game consoles. The programmable function of the latest generation of digital power supervisor ICs allows clients to design more flexible products, help clients shorten development cycle and lower development risks.

  • b. In response to the market demand for fast charging, many international manufacturers have introduced USB Type-C PD and other fast-charging control ICs, leading the market share. We will continue to develop fast-charging control ICs for laptops, mobile phones, tablets, game consoles and after-sales markets.

  • c. The secondary-side PWM power control ICs for USB Type-C PD control ICs have been put into mass production in 2019. We will utilize the technical advantages of the product and our high market share in USB Type-C PD control ICs, and constantly promote the overall optimization program.

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  • Smart application ICs:

  • a. Leveraging the technology of recently acquired subsidiary, Sentelic Corporation, our smart fan motor drive and control ICs hold a market share of over 30% in the server cooling fan market. They are also utilized in 5G base stations, charging stations, solar power inverters, mining machine, graphics cards, and other related products.

  • b. Financial payment related chips, such as POS magnetic stripe decoder Ics and interface ICs, have stable market share due to high entry barriers for latecomers and security authentication requirements. QR code reader IC supports multiple payment methods and can be used in industrial and consumer electronics.

  • c. Our line of 8-bit and 32-bit general-purpose MCUs offers a comprehensive range of computing speeds and power requirements, making them suitable for various products, such as computer and gaming peripherals, small home appliances, household healthcare devices and industrial controls, etc. These MCUs have been successfully introduced by numerous clients and maintain stable shipment levels.

In terms of agent products, the market share and future supply and demand of the Company and its subsidiary Dongguan Prosil Electronics Co., Ltd. are described as follows:

  1. With the head office's existing R&D capabilities and actual performance, we will enhance technical support to clients and improve operational performance in key client base and important industries such as automotive, power and motor.

  2. Keep abreast of client dynamics and market information, introduce complementary product lines at the proper time, strengthen the our competitiveness and create more value to clients.

  3. Make good use of our information system to keep abreast of the latest inventory and market trends, review the incoming and outgoing inventory regularly, maintain good stock quality, and keep the best supply condition at all times.

  4. Our subsidiary Dongguan Prosil Electronics Co., Ltd has been taking over the business of Taiwanese companies transferred to Dongguan and actively promoting the mature application solutions from Taiwan to the local potential clients to generate new revenue.

The advantages and disadvantages of the Company's future development are listed as follows:

  • Advantages:

  • Good professional and brand image is conducive to the development of new products.

  • The sound financial status is conducive to responding to current and unforeseen market conditions.

  • Our test factory can provide the best services to clients.

  • Deep relationships with key OEM partners provide competitive supply chain advantages.

  • We are a distributor of internationally renowned brands of electronic components for integrated applications and sales, which is conducive to providing clients with total solution.

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  1. By gradually establishing relationships with brand manufacturers and gaining trust, we can obtain specifications early and facilitate product development.

  2. Disadvantages:

  3. Wafer foundry has experienced price increases over the past few years due to factors such as tight production capacity and rising raw material costs, which have had a slight impact on profitability.

  4. Uncertainties such as the Ukrainian-Russian war and inflation may affect end-user consumption.

  5. China's supply chain is supported by national policies, making competition unfair. As a result, the market and profit margins are facing challenges.

  6. (II) Important applications and production process of major products

  7. Important uses of major products

Primary uses Product family
Power management Supervisor ICs of switched power supplies for desktop
computers, servers, game consoles, and fast-charging
chargers for mobile phones, tablets, laptops, game consoles,
etc., which support USB Type-C PD or Qualcomm Quick
Charge 3+/4/4+/5 /5+ IC.
Imaging solution 1.
Smart camera processing ICs with image detection and
identification and AI technology can be applied to
advanced driver assistance systems (ADAS), security
or smart production.
2.
ISP ICs for automotive, industrial control, and
consumer product lenses.
3.
ICs for projectors with intelligent auto adjustment
function.
Smart controller 1.
Used in thermal management for servers, 5G base
stations, EV charging stations, solar power inverters,
mining machines, and graphics cards, including
high-integration intelligent fan motor driver and
controller for air-cooling solutions, as well as related
ICs for liquid-cooling solutions.
2.
ICs for POS payment.
3.
A series of general-purpose 8-bit and 32-bit
microcontrollers, used in consumer electronics such as
personal computers and gaming peripherals.

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2. Manufacturing process

As shown below, the Company is positioned as a Fabless IC Company, commonly known as an IC designer. The main work includes IC product planning, R&D, testing, sales, etc. The production process is illustrated as follows:

==> picture [493 x 224] intentionally omitted <==

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

Photomask/Wafer Product
Product Finished product
foundry Wafer testing IC packaging application
planning/R&D testing
manufacturing and sales
 Market research
 Product planning
 Circuit design
 Circuit layout
a. Circuit development and design process: Develop circuits based on market and
product planning and client requirements, and design and simulate them with
CAD.
----- End of picture text -----

  • b. Photomask and wafer manufacturing process: They are commissioned to be manufactured by professional photomask and wafer fabs. After all processes are completed, electrical parameters will be measured and inspected before delivery.

  • c. Wafer testing process: Wafer testing and development and IC functional test are performed under a complete system.

  • d. IC packaging process: After testing, wafers are assigned to the packaging factory to carry out packaging operations for required packaging types, such as DIP, SOT, SOP, QFN, QFP/LQFP, BGA/LGA, etc.

  • e. Finished product testing and shipping process: After full functional testing by our factory and the outsources professional testing factories, we will carry out the shipment according to the order.

(III) Availability of major raw materials

The Company is an IC design company, also known as fabless IC company. Its core work is to develop, test, promote and sell IC products. The Company outsources the wafer fabrication and IC packaging. Therefore, the main raw materials refer to wafers and packaging. The Company cooperates with leading wafer fabs, and its process technology, production efficiency, scheduling flexibility and production quality are second to none in the world. The Company has been able to supply on time and in full as long as a reasonable delivery schedule is given. Following the global post-pandemic situation and the semiconductor supply-demand imbalance arising from the US-China trade issues, the related raw material inventory and production capacity utilization rates in the supply chain have undergone complex changes. The electronic industry components continue to experience a phenomenon of inventory clearance due to the cooling of market demand within the industry chain.

The advantage of the Company is that it has always attached importance to long-term relationships with suppliers. We have maintained good interaction and loyal partnership with wafer fabs and packaging and testing plants. At the beginning of 2024, inventory

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levels had reached a reasonable range. Throughout the year, the Company continued to coordinate with suppliers on capacity adjustments and effective inventory management, while also preparing appropriate stock in response to increasing demand in specific market segments. Besides, in response to issues related to the supply chain arising from Sino-US trade war, the production planning of the dual supply chain is based on the subsequent production planning and layout direction to meet the requirements of the U.S. and China.

In terms of distribution business, the Company primarily acts as an agent for Japanese IC and electronic component companies. With its own wafer manufacturing and packaging testing factories, the Company offers a diverse range of products and provides Total solution to key customers and industries. This approach aims to expand sales revenue from agency products and alleviate excess inventory.

  • (IV) Production strategy

  • Make full use of Taiwan's unique semi-conductor subcontracting capabilities and provide customization flexibility to meet the diverse and specific needs of our clients and to enhance client satisfaction.

  • Establish good partnership with wafer fabs, packaging and testing plants, and have a tacit understanding of OEM, to ensure production capacity and control product delivery, quality and yield, to meet client demand and service expectations.

  • Establish the long-term cooperation with wafer fabs and third-party manufacturers to increase product quality and price competitiveness.

  • Improve product process capability and take advantage of wafer fabs’ new process technology and packaging technology to lower cost, improve yield and market competitiveness.

  • Maintain long-term cooperation with upstream wafer fabs, packaging and testing manufacturers, and strive to be their strategic partners to jointly develop special functional processes to lower production costs and develop competitive products.

  • Due to the changes in the supply and demand environment in 2024, we flexibly responded to market changes. Apart from negotiating production capacity planning with suppliers, we have timely adjusted production capacity and estimated medium to long-term demand based on inventory conditions, to achieve favorable operational planning for both parties. For the estimation and allocation of capacity required for economic recovery, the Company continues to adjust and plan according to market dynamics. Effective rolling coordination with suppliers ensures the necessary capacity planning. Additionally, proactive planning and production activities are undertaken for dual supply chain models to meet customer specifications and requirements regarding production locations.

105

  • (V) List of major importers and sellers in the last two years:

Names of clients who have accounted for more than 10% of the total volume of imports (sales) in any year of the recent two years, together with the amount and proportion of imports (sales) and the reasons for the changes. However, as contract stipulates that the name of the client or the counterparty shall not be disclosed, if the client is an individual and not a related party, a code shall replace the name.

Information on major suppliers in the last two years

Unit: NT$ thousand

Information on major Information on major Information on major Information on major suppliers in the last two years
Unit: NT$thousand		 suppliers in the last two years
Unit: NT$thousand		 suppliers in the last two years
Unit: NT$thousand		 suppliers in the last two years
Unit: NT$thousand
2023 2024
Items Company
name		 Amount Percentage of
net annual
purchases
(%)
Relationship
with Issuer		 Company
name		 Amount Percentage of
net annual
purchases
(%)
Relationship
with Issuer
1 Supplier
A		 226,326
24%
None		 Supplier
A		 691,421
40%
None
2 Supplier
B		 385,611
41%
None		 Supplier
B		 451,508
26%
None
3 Supplier
C		 - Less than
10%

None		 Supplier
C		 214,267
12%
None
4 Others 322,659
35%		 - Others 393,243
22%		 -
Net
purchases		 934,596
100%		 - Net
purchases		 1,750,439
100%		 -

  • Note 1: The increase in purchases from Suppliers A, B, and C in 2024 was primarily driven by improved industry conditions and a surge in customer orders, prompting the Company to scale up its procurement activities.

  • Note 2: List the names of suppliers who have purchased more than 10% of the total amount of goods in the last two years and the amount and proportion of goods purchased. However, as contract stipulates that the name of the supplier or the counterparty shall not be disclosed, if the supplier is an individual and not a related party, a code shall replace the name.

  • Note 3: As of the printing date of the Annual Report, financial information of companies whose shares are listed or traded on the stock exchange shall be disclosed if they have been audited or reviewed by CPAs recently.

Information on major clients in the last two years

Unit: NT$ thousand

Unit: NT$thousand Unit: NT$thousand Unit: NT$thousand Unit: NT$thousand
2023 2024
Items Company
name		 Amount Ratio to net
sales (%)		 Relationship
with Issuer
Company
name		 Amount Ratio to net
sales (%)		 Relationship
with Issuer
1 Client A - Less than
10%

None		 Client A 324,582 10.49%
None
2 Client B 303,293
10.51%
None		 Client B 262,267
8.47%
None
3 Others 2,582,267
89.49%		 - Others 2,507,770 81.04% -
Net sales 2,885,560
100%		 - Net sales 3,094,619
100%		 -

  • Note 1: In 2024, more than 10% of the Company's total sales were attributed to Client A, primarily due to an increase in sales of smart fan motor driver ICs.

  • Note 2: As of the printing date of the Annual Report, financial information of companies whose shares are listed or traded on the stock exchange shall be disclosed if they have been audited or reviewed by CPAs recently.

106

III. Employees

Number of employees, average length of service, average age and education background for the last two years and as at the publication date of the Annual Report

Year 2023 2024 As of April 12,
2025
Number of
employees		 Administration/finance 53 53 52
Business 80 80 78
Technology 227 235 234
Total 360 368 364
Average age 44.94 45.55 46.47
Average Years of Services 11.64 11.57 11.73
Distribution of
education
background		 Ph.D. 1% 1% 1%
Master’s degree 32% 33% 33%
Bachelor’s degree 62% 62% 62%
Senior high school 5% 4% 4%
Below senior high school 0% 0% 0%

  • IV. Environmental expenditure information

  • (I) Losses suffered as a result of environmental pollution in the most recent year and up to the publication date of the Annual Report: None.

  • (II) Estimated current and potential future amounts and countermeasures. If it cannot be reasonably estimated, the reasons shall be stated: None.

  • (III) The Company is engaged in product development, design and sales, and outsources its self-developed wafers and IC packaging to relevant suppliers. The Company conducts wafer testing, package testing and subsequent packaging and shipping internally, so it is pollution-free. In the last two years and up to the publication date of the Annual Report, the Company's products are in line with the relevant standards of RoHS, and has not suffered any loss or punishment due to environmental pollution. Therefore, there are no future countermeasures and possible expenses.

  • (IV) As for the process and ICs provided by suppliers, in accordance with the Company's Supplier Management Regulations and HSF Management Procedures, suppliers shall provide material analysis reports regularly every year to confirm whether they are green products as defined by the Company. The Company also appoints a third-party certification company to test, monitor and manage the supplier's materials to comply with regulations for the management of hazardous substances, as well as the relevant regulations of ROHS and Sony GP.

  • (V) For defective scrapped IC products, the Company entrusts a Class-A waste removal and treatment company registered by the government to handle the disposal of these products every six months.

  • (VI) In 2009, the Company was certified by IECQ QC 080000 Hazardous Substance Process Management. The Company conducts annual certification audit by the accredited firm and has obtained validity certificate for certification system.

  • (VII) The Company obtained the ISO 14001 Environmental Management System certificate in March 2023, followed by the ISO 14064-1:2018 Greenhouse Gas Emissions Inventory and Verification certification in November.

107

  • V. Labor-management relationship

  • (I) Employee welfare measures, further education, training and retirement systems and the relevant implementation, as well as labor-management agreements and various employee rights protection measures:

    1. In addition to general benefits such as labor insurance, health insurance, group insurance, and pension payments, the Company provides employees with annual bonuses, dividends, wedding and funeral gifts, lunch subsidies, employee education and training, libraries for study and reading, breastfeeding rooms for female employees, and flexible commuting systems.

    2. We implement the concept of gender equality in the workplace, and the salary of staff at all levels does not differ due to gender. Although the Company is engaged in the electronics, it is committed to diversity and equality in the workplace. Currently, females account for about 32% of the employees and 11% of the senior executives.

    3. The Company establishes the Employee Benefit Committee according to law, selects committee members to handle employee benefits, and prepares the annual plan and budget every year, such as preparing festival gifts, organizing group tourism, conducting community activities, holding birthday parties, etc.

    4. Employee education and training: To encourage our employees to continuously enrich their knowledge to enhance the corporate competitiveness, we provide complete education and training for new employees so that they can understand the working rules and regulations and become familiar with the work content in a short time. Besides, we provide internal and external professional training courses for existing employees to strengthen their working ability.

    5. For employees applicable to the Labor Pension Act, the Company provides the retirement reserve funds at a rate of 6% of employees’ monthly salary and deposits them in the labor pension individual account established by the Bureau of Labor Insurance, Ministry of Labor. According to the law, the Company regularly allocates retirement reserves and deposits them in the Bank of Taiwan, and then the Supervisory Committee of Labor Retirement Reserve is responsible for the management and use of retirement reserves.

    6. To care for the health of employees and prevent obesity and chronic diseases such as hypertension and diabetes, the Company organizes regular health seminars and employee health check-ups each year. Additionally, a fitness center is provided for employees, equipped with various exercise machines for their use. To further encourage participation in physical activities and achieve the goal of weight loss and chronic disease prevention, the Company began organizing walking competitions in the second half of 2023. Prizes are offered to motivate employees to participate. The first event, held in early July 2023, saw a total of 17.75 million steps walked by employees as of June 2024. The outcome of the first event met expectations, and the Company will continue to implement this activity. Through competitions, employees will be encouraged, and other related initiatives, such as hiring fitness trainers and promoting road running events, will gradually be introduced. In terms of diet, the Company offers a diverse range of lunch options. In addition to regular meals, healthy and vegetarian meal options are also provided, along with meal subsidies. The goal is to promote both healthy eating and physical activity, helping employees avoid chronic diseases such as hypertension, diabetes, and obesity.

  • (II) Losses suffered as a result of labor-management disputes in the most recent year and up to the publication date of the Annual Report: None.

  • (III) Estimated current and potential future amounts and countermeasures: None.

108

VI. Cyber security management:

  • (I) Explain the cyber-related security risk management structure, security policy, and specific management plan, and resources invested in cyber security management:

  • Cyber security risk management structure

To strengthen the risk management of information security, the Information Department is responsible for coordinating and implementing the information security policy, establishing the information security risk management structure and the process flow and specific management plan of information security incident notification, regularly reviewing the information security policy, propagating information security messages, and enhancing the employee awareness of information security to ensure information security.

  1. Cyber security policy

To improve the information security governance and defense capabilities, the Company has established an internal control system. All information operations are subject to the internal control system and the risk management review by the internal and external units on a regular and daily basis. The Company strives to achieve the following goals.

  • a. Ensure the confidentiality and integrity of information assets.

  • b. Ensure that data access is regulated according to departmental functions.

  • c. Ensure the continuous operation of information systems.

  • d. Prevent unauthorized modification or use of data and systems.

  • e. Perform regular security audit to ensure information security.

  • Specific management plan, and resources invested in cyber security management

  • a. Cyber security control

    • A. Set up a firewall.

    • B. Set up endpoint antivirus, mail antivirus and spam systems to protect computer systems and data storage media.

    • C. Establish an identification system to understand the interoperation of different computers and identify abnormal developments to detect threats in advance.

    • D. Ensure that the use of various network services is implemented in accordance with information security policies.

    • E. Check the System Log of each network service item regularly to track the abnormal situation.

  • b. Computer equipment security management

    • A. Appoint dedicated personnel to manage computer equipment and systems.

    • B. Equip server rooms with independent air conditioners and fire extinguishing equipment. Maintain the equipment regularly to ensure availability.

    • C. Equip server rooms with independent power supply devices to prevent system downtime caused by power exceptions.

    • D. Set up environmental control systems in server rooms and report exceptions to the management personnel.

109

  • c. System and data access control

    • A. Set accounts and passwords for all systems.

    • B. According to functional requirements, different access rights are granted after process review and approval.

    • C. Set up and modify system programs. Establish records, audit and other relevant control measures in accordance with change management procedures.

    • D. Cancel the authority of the personnel who leave their positions.

  • d. Emergency response mechanism for recovery

    • A. Regularly review emergency response plans.

    • B. Regularly exercise the system for restoration every year.

    • C. Establish system backup mechanism and implement remote backup.

    • D. Regularly review computer network security controls.

  • e. Publicity and check

    • A. Publicize information security at any time, and set up an information security bulletin board to enhance employees' awareness of information security.

    • B. Information operation is subject to the Company's internal control system and risk management audit by internal and external units on a regular basis.

    • C. Report the information security to the Board of Directors on an annual basis to strengthen its supervision and management of the Company's operations.

  • Status of execution

The Company has no material information security incidents that cause business damage. Continuously implement information security management policies and regularly conduct recovery plan drills to protect the security of critical systems and data.

  • (II) The losses, possible impacts and measures taken as a result of material information security incidents in the most recent year and up to the date of printing of the Annual Report. If it cannot be reasonably estimated, the reasons shall be stated.

In the most recent year and up to the publication date of the Annual Report, the Company has no material information security incidents that cause business damage.

  • VII. Material contracts: List the parties involved, main contents, restrictive covenants and start/end dates of supply and marketing contracts, technical cooperation contracts, engineering contracts, long-term lease contracts and other important contracts affecting shareholders' rights and interests that are still in force as of the publication date of the Annual Report and expire in the most recent year.
Nature Parties involved Start/end date Main contents Restrictive
covenants
Lease contract Administration Bureau of
Hsinchu Science Park		 2022/01/01~2026/12/31 Plant leas None
Agent
Agreement		 ROHM 2024/04/01~2025/03/31 Integrated circuit
sales		 None
Agent
Agreement		 Sonix Technology Co., Ltd. 2017/10/01~ automatic
extension		 Product Distribution
Contract
None
Lease contract New Foundland Global Corp. 2024/11/01~2027/10/31 House Rental None

110

Chapter 5 Review and Analysis of Financial Position and Financial Performance and Risk Events

  • I. Financial status: The major causes and impacts of material changes in assets, liabilities and equity in the last two years. If the impact is significant, the future response plan shall be proposed.
proposed. proposed. proposed.
Unit: NT$thousand
Item/Year 2024 2023 Change,byamount
Amount %
Current assets 4,481,627
4,276,042
205,585
4.81
Non-current assets 1,492,697
1,575,921
(83,224)
(5.28)
Total assets 5,974,324
5,851,963
122,361
2.09
Current liabilities 1,839,883
546,865
1,293,018
236.44
Non-current liabilities 179,170
1,251,719
(1,072,549)
(85.69)
Total liabilities 2,019,053
1,798,584
220,469
12.26
Sources of capital 1,780,116
1,780,116
-
-
Capital reserve 266,971
266,965
6
-
Retained earnings 1,657,545
1,542,394
115,151
7.47
Other equity (104,997)
(24,853)
(80,144)
322.47
Treasury stock (206,993)
(83,400)
(123,593)
148.19
Non-controlling
interests		 562,629
572,157
(9,528)
(1.67)
Total equity 3,955,271
4,053,379
(98,108)
(2.42)
Explanation of the main reasons and impacts of 20% changes in assets, liabilities and
shareholders' equity in the last two years:
1.
The increase in current liabilities is due to the reclassification of the Company's bonds
payable as current portion of bonds payable due within one year in 2024, resulting in an
increase in current liabilities.
2.
The decrease in non-current liabilities is due to the reclassification of the Company's bonds
payable as current portion of bonds payable due within one year in 2024, resulting in a
decrease in non-current liabilities.
3.
The increase in the negative value of other equity was due to the decrease in unrealized
gains from other comprehensive income in 2024.
4.
The increase in treasury stock is due to the increase in the number of treasury shares
purchased in 2024.

Explanation of the main reasons and impacts of 20% changes in assets, liabilities and shareholders' equity in the last two years:

  1. The increase in current liabilities is due to the reclassification of the Company's bonds payable as current portion of bonds payable due within one year in 2024, resulting in an increase in current liabilities.

  2. The decrease in non-current liabilities is due to the reclassification of the Company's bonds payable as current portion of bonds payable due within one year in 2024, resulting in a decrease in non-current liabilities.

  3. The increase in the negative value of other equity was due to the decrease in unrealized gains from other comprehensive income in 2024.

  4. The increase in treasury stock is due to the increase in the number of treasury shares purchased in 2024.

111

  • II. Financial performance: The main reasons for the significant changes in the operating revenue, net operating profit and net profit before tax in the recent two years, the expected sales volume and their basis, the possible impact on the Company's future financial business and the corresponding countermeasures.
Unit: NT$thousand Unit: NT$thousand Unit: NT$thousand Unit: NT$thousand
Item/Year 2024 2023 Increase
(decrease) in
amount		 Percentage
(%)
Net operating income 3,094,619
2,885,560
209,059
7.25
Operating costs 2,172,134
2,103,785
68,349
3.25
Gross profit 922,485
781,775
140,710
18.00
Operating expenses 758,422
739,945
18,477
2.50
Net operating income 164,063
41,830
122,233
292.21
Non-operating income and
expenses		 181,768
184,656
(2,888)
(1.56)
Net profit before tax 345,831
226,486
119,345
52.69
Income tax expenses 50,966
19,400
31,566
162.71
Net profit for the current
year		 294,865
207,086
87,779
42.39
Other comprehensive gains
and losses		 (27,462)
113,712
(141,174)
(124.15)
Total comprehensive gains
and losses for the current
year		 267,403
320,798
(53,395)
(16.64)
Net profit attributable to
owners of parent company		 275,562
209,240
66,322
31.70
Total comprehensive gains
and losses attributable to
owners of the parent
company		 247,535
322,539
(75,004)
(23.25)

112

  • (I) The reasons for the 20% change in operating income, net operating income and net income before tax:

  • Net operating income increased, mainly due to the growth in Non-operating income and a decrease in the loss provision for obsolete inventory, which resulted in an increase in Gross profit.

  • Net profit before tax increased, primarily due to the increase in net operating income.

  • The increase in income tax expense was mainly due to the increase in net profit before tax.

  • Net profit for the current year increased, primarily due to the increase in Net profit before tax.

  • The decrease in other comprehensive gains and losses was mainly due to the decrease in unrealized gains or losses from equity investments measured at fair value through other comprehensive income.

  • The increase in the net profit attributable to owners of parent company for the current year was mainly due to the increase in the net profit for the current year.

  • The decrease in the total comprehensive gains and losses attributable to owners of the parent company for the current year was mainly due to the decrease in unrealized gains or losses from equity investments measured at fair value through other comprehensive income.

  • (II) The expected sales volume and their basis, the possible impact on the Company's future financial business and the corresponding countermeasures:

The expected sales volume is based on the estimated volume of products developed and distributed in the past year and the expected shipment volume of clients in the market. The impact on the Company's future financial operations can be found in the Report to Shareholders.

III. Cash flow: Analysis of the changes in cash flow for the most recent year, plans to improve liquidity and analysis of cash flow for the coming year.

Unit: NT$ thousand

Unit: NT$thousand Unit: NT$thousand
Cash amount at
the beginning
of the year		 Net cash flow
from operating
activities		 Cash inflow
(outflow)
throughout the
year		 Cash balance
(deficit)
Remedial measures for cash
inadequacy
Investme
ntplan		 Wealth
managementplan
1,242,075 407,414 (774,927) 874,562 - -
Analysis of cash flow changes in 2024:
1. The net cash inflow from operating activities was mainly due to the increase in net
income before tax in 2024.
2. Net cash outflow from investing activities was primarily due to the increase in
investments in marketable securities in 2024.
3. Net cash outflow from financing activities was primarily due to the payment of cash
dividends amounting to NT$212,399 thousand and the purchase of treasury stock totaling
NT$127,668 thousand in 2024.

113

Cash flow for the coming year

Unit: NT$ thousand

Cash amount at
the beginning of
the year		 Net cash flow
from operating
activities		 Cash inflow
(outflow)
throughout the
year		 Cash balance
(deficit)		 Remedial measures for cash
inadequacy		 Remedial measures for cash
inadequacy
Investment
plan		 Wealth
managementplan
874,562 468,469 (585,588) 757,443 - -
I.
Analysis of cash flow changes in 2025:
1. The net cash inflow from operating activities will be mainly due to the estimated net
income for 2025.
2. The net cash inflow from investing activities is mainly expected to result from receiving
dividends from reinvestments and investments in marketable securities for 2025.
3. The net cash outflow from financing activities will be mainly due to the payment of cash
dividends of NT$303,659 thousand from earnings distribution in 2025.
II.
Remedial measures and liquidityanalysis of estimated cash deficiency: None.

  1. The net cash inflow from operating activities will be mainly due to the estimated net income for 2025.

  2. The net cash inflow from investing activities is mainly expected to result from receiving dividends from reinvestments and investments in marketable securities for 2025.

  3. The net cash outflow from financing activities will be mainly due to the payment of cash dividends of NT$303,659 thousand from earnings distribution in 2025.

II. Remedial measures and liquidity analysis of estimated cash deficiency: None.

  • IV. Impact of major capital expenditure on financial operations for the most recent year:

The Company's major capital expenditures in 2024 mainly include investments in production, R&D equipment, and intangible assets, which were purchased with its fund, an amount of NT$55,214 thousand. It was mainly used for the Company's future business expansion, which has little impact on financial business.

  • V. The most recent year's reinvestment policy, the main reasons for profit or loss, improvement plans and investment plans for the coming year:

  • (I) In 2024, Weltrend International (BVI) recorded increased profits due to a rise in investment income. Yingquan Investment generated profits from interest income on U.S. dollar time deposits. Dongguan Prosil Electronics has experienced growth in both revenue and profit compared to last year, due to the economic recovery in China. Sentelic saw an increase in both revenue and profit compared to the previous year, due to the rebound in the electronics industry. Sentelic Holding Co., Ltd is a small-scale company and reported neither profit nor loss.

  • (II) The Company's major investment plans in the coming year.

On March 7, 2025, the Boards of Directors of both the Company and Sentelic Corporation each resolved to approve a merger through a share swap. Upon completion of the share swap, Sentelic will become a wholly owned subsidiary of Weltrend Semiconductor. Under the terms of the share swap, Weltrend Semiconductor will issue new common shares to all shareholders of Sentelic at a ratio of 1.60 shares of Weltrend common stock for every 1 share of Sentelic common stock, thereby acquiring all outstanding shares of Sentelic. The Company plans to issue 23,516,480 new common shares to the shareholders of Sentelic, excluding those held by Weltrend. Sentelic’s Board of Directors has also approved the convening of a shareholders’ meeting on May 26, 2025, to seek approval for the share swap. The share swap base date will be set upon receiving approval from the relevant competent authorities.

114

  • VI. Risk assessment for the most recent year and up to the publication date of the Annual Report:

  • (I) Impact of interest rate, exchange rate fluctuation and inflation on the Company's profit and loss and future countermeasures:

    1. Impact of interest income and expenditure and exchange gains and losses on the Company's profits and losses:
any'sprofits and losses:
Item/Year 2024 (NT$ thousand)
Interest income 44,524
Interest expenditure 26,423
Net foreign currency gain 119,261

In 2024, due to the depreciation of Taiwan dollar against the U.S. dollars, the Company generated a net foreign currency gain of NT$ 119,261 thousand.

  • (II) Impact of inflation on the Company's profit and loss and future countermeasures:

The increase in demand for raw materials in the recent year had no material impact on the Company's profit or loss.

  • (III) Measures to cope with changes in interest rate and exchange rate:

  • The Company's product sales are partially denominated in U.S. dollars, and raw materials are partially denominated in U.S. dollars, thus reducing the impact of changes in exchange rate on profitability. Due to sufficient working capital, changes in interest rates have little impact on the Company. Due to the small operating scale of subsidiaries, they have little impact on the interest rate and exchange rate.

  • The Company always pays attention to the information of changes in the interest rate and exchange rate to take appropriate measures in a timely manner. The appreciation of the Taiwan dollar is unfavorable to the Company.

  • (IV) Policies for engaging in high-risk, highly leveraged investments, lending of funds to others, endorsement of guarantees, and derivative transactions, the main reasons for profit or loss, and future measures:

For the year 2024 and up to the publication date of the Annual Report, the Company has not engaged in high-risk, highly leveraged investments, derivative transaction, endorsement of guarantees, nor has it loaned funds to others.

  • (V) Future R&D plans and estimated R&D expenses:

2025 R&D plans are as follows:

  1. Power management and analog ICs:

  2. USB Type-C PD (Power Delivery), and other protocol controllers, primary-side PWM power control ICs, and synchronous rectification control ICs for USB Type-C wall chargers, car chargers, and power banks. In response to the trend towards high efficiency and miniaturization of chargers, the Company will also collaborate with Gallium Nitride (GaN) or MOSFET manufacturers to introduce highly integrated System-in-Package (SiP) encapsulated products. The Company will also develop more energy-efficient products to meet the latest energy efficiency regulations.

  3. Developed a USB Type-C PD control chip for use in devices such as laptops.

  4. Highly integrated and digitized secondary-side monitoring power management ICs.

  5. Battery management chip.

115

  1. Smart application ICs:

  2. ICs for highly-integrated smart fan motor driver and control.

  3. 32-bit microcontrollers for industrial purposes.

  4. Customer-specific customized IC (ASIC)

These are specialized and exclusive products tailored to meet the specific requirements of customers. After registration, they will be classified according to product attributes into either power and analog or smart applications.

In the future, the Company will invest in R&D for the continuous development of new products. The estimated investment amount is NT$ 450,000 thousand.

  1. Impact of important domestic and foreign policies and legal changes on the Company's financial business and countermeasures:

The management of the Company and its subsidiaries attaches great importance to the important domestic and foreign policies and legal changes and takes appropriate measures to lower the impact on the financial business of the Company.

  1. Impact of technological changes (including cyber security risks) and industrial changes on the Company's financial business and countermeasures:

Technological changes have intensified industrial competition. In addition to increasing the number of talented R&D personnel to accelerate the development of product lines and upgrade high-end processes, the Company strengthens product innovation, product quality and product diversification, introduces new R & D techniques and partners to meet the market demand, so as to lower the impact on the Company's financial business.

The Company established the Information Security Committee to formulate and implement the information security management system for information security risk control. Apart from preparing information security policy documents to regulate the information security, the Company conducts annual information security risk assessments and internal and external information security audits to ensure the effectiveness of the management system and compliance with legal requirements. Therefore, the information security risk is not a material operational risk for the Company. But, we cannot guarantee that its computer system can avoid the attack of network viruses initiated by third parties that may cause system paralysis. These cyber attacks illegally infiltrate our internal network systems to cause disruption to our operations or damage to our goodwill. Failure to resolve the difficult technical issues caused by these cyber attacks in a timely manner may seriously impact our financial performance and commitment to clients and other stakeholders.

  1. Impact of corporate image change on corporate crisis management and countermeasures:

The Company has always attached importance to the corporate image, steady operation, and the implementation of corporate governance, to maintain social welfare. So far, no incidents affecting the corporate image have occurred.

  1. Expected Benefits from, Risks Relating to and Response to Merger and Acquisition Plans:

On March 7, 2025, the Board of Directors of both the Company and Sentelic Corporation each resolved to approve a merger through a share swap. Upon completion of the share swap, Sentelic will become a wholly owned subsidiary of Weltrend Semiconductor.

116

In August 2022, the Company acquired a 51.04% stake in Sentelic through a public tender offer, marking the first phase of the merger between the two companies. After more than two years of collaboration, both teams have integrated research and development resources, product portfolios, sales channels, and back-end operations, with preliminary synergies already visible. Due to the significant complementary effects in technology and products, the combined entity is able to offer a more comprehensive product lineup and solutions. Furthermore, with an expanded customer base, the Company has become a global leader in the field of server fan motor control chips.

Based on this foundation, both parties believe that the share swap will further enhance economies of scale, improve operational efficiency, and strengthen integration synergies. In the increasingly competitive and fast-evolving global semiconductor market, this move is expected to continuously enhance the competitiveness of both companies, creating a win-win-win outcome for shareholders, customers, and employees alike.

  1. Expected benefits and possible risks of plant expansion and countermeasures: The Company has no plans to expand its plant in 2024.

  2. Risks arising from concentration of purchases or sales and corresponding response measures:

  3. a. The Company mainly buys goods from leading wafer fabs and Japanese manufacturers, with an emphasis on yield rate, delivery time, price, advanced manufacturing process and other factors. Due to good and long-term relationships with these manufactures, there is little risk for the Company in the short and medium term. In the long run, there are many professional wafer, packaging, and testing factories at home and abroad, so the Company has no problem to purchase products.

  4. b. The customer structure of the Company is highly stable and healthy, with clients diversified across various industries including laptops, smartphones, PCs, smart fan motors, gaming peripherals, automotive electronics, and POS machines. This diversification mitigates the risk associated with concentrated sales.

  5. The impact and risks of the mass transfer or change in shareholding of directors or substantial shareholders holding more than 10% of the shares of the Company and countermeasures:

There is no mass transfer or change in shareholding of directors or substantial shareholders holding more than 10% of the shares of the Company.

  1. Effects of, risks relating to and response to the changes in management rights:

There is no change in the operating rights of the Company.

  1. Litigation or non-litigation matters:

The Company and its directors, president, responsible persons, substantial shareholders holding more than 10% of the shares and subsidiaries have not had any major litigation, non-litigation or administrative disputes so far.

  1. Other material risks and countermeasures: None.

VII. Other important matters: None.

117

Chapter 6 Special Matters to Be Noted

  • I. Information on the Company Affiliates

  • (I) Consolidated Business Report of Company Affiliates: Please refer to the Market Observation Post System (MOPS).

  • (II) Consolidated Financial Statements of Company Affiliates: Please refer to the Market Observation Post System (MOPS).

  • (III) Affiliation Report: Please refer to the Market Observation Post System (MOPS).

Path to Access Company Affiliates' Information: Market Observation Post System (MOPS) → Individual Company → Electronic Document Download → Company Affiliates Section (Three Required Reports)

https://mopsov.twse.com.tw/mops/web/t57sb01_q10

  • II. Private placement of marketable securities in the most recent fiscal year and up to the publication date of the Annual Report: None.

  • III. Other supplementary information: None

Chapter 7 In the most recent fiscal year and up to the publication date of the Annual Report, if there have been events that had a significant impact on shareholders' equity or the price of securities as defined in Subparagraph 2 of Article 36-3 of the Securities and Exchange Act: None.

118

Weltrend Semiconductor, Inc.

Chairman: Sam Lin

Date of publication: April 12, 2025

119

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