QUANTA COMPUTER INC.

Transcription

1 [Translation] Stock Code: 2382 QUANTA COMPUTER INC Annual General Shareholders Meeting Meeting Minutes June 19, 2014

2 QUANTA COMPUTER INC Annual General Shareholders Meeting Minutes Time: June 19, 2014 (Thursday) at 9:00 am Venue: Quanta Computer (No. 188, Wen-Hwa 2nd Road, Kuei Shan, Taoyuan Shien, Taiwan) Total shares represented by shareholders present in person or proxy: 3,518,873,165 shares, or 91.10% of total outstanding shares of 3,862,627,432. Chairman: Barry Lam Attendees: Wan-Wan, Lin (CPA); Tien-I, Chiu (Lawyer) Recorder: Hsin-Yi, Chien The aggregate shareholding of the shareholders present in person or proxy constituted a quorum. The Chairman called the meeting to order. Chairman s Address: (Omitted) I. Report Items: None Shareholders Comments: Shareholder expressed objections regarding resolutions for each of the proposed items. Shareholder also expressed concerns regarding lack of reporting items, concentration of shareholder structure, certain parts of the financial statements, dividend policy and retained earnings. Shareholder reaffirms the Company s performance and encourages the Company to compensate relevant personnels on the remarkable NT$1.2B foregin exchange gain in 1Q 14. Upon solicitation of comments by Chairman, CFO and lawyer, both shareholders had no further comments. II. Approval Items: Item 1. To accept FY2013 business report and financial statements (including independent auditor's report and supervisor's review report) Description: (1) Quanta Computer s FY2013 Business Report and Financial Statements, including Balance Sheet, Income Statement, Statement of Changes in Shareholders Equity, and Cash Flow Statement, were audited and certified by KPMG Certified Public Accountants. Please refer to attachment I through III. For financial reports please refer to website:

3 Voting Results: The number of votes casted for the proposal was 2,820,212,802 or 80.14% of the votes represented by the shareholders present. RESOLVED, that the FY2013 Business Report and Financial Statements hereby were accepted as submitted. Item 2. To approve the allocation of FY2013 retained earnings Description: (1) The amount for 2013 earnings available for distribution is derived from net income after tax and after a 10% legal capital reserve. In accordance to article 27 under the Articles of Incorporation, the distribution details are listed as below and were thereof reviewd and approved by the supervisors. (2) After shareholders meeting approval, the Board of Directors will separately announce the dividend distribution date. (3) The total amount of common shares outstanding may change and the ultimate cash and stock to be distributed to each common share may need to be adjusted accordingly should regulations change or officials request resulting in adjustment on distribution is required. It is proposed that the Board of Directors of Quanta Computer be authorized to adjust the cash and stock to be distributed to each common share based on the total amount of profits resolved to be distributed and capital surplus resolved to be capitalized, and the number of actual common shares outstanding on the record date for distribution. Quanta Computer Inc Statement of Distribution of Retained Earnings Item Undistributed surplus at the beginning of the period (ROC GAAP) Less: adjustment on the transition day of adopting IFRS Add: adjustment on 2013 net income after tax in accordance to IFRS Undistributed surplus at the beginning of the period (IFRS) Unit: NT$ Total 32,781,093,587 (270,731,486) 17,493,657 32,527,855,758 Less: adjustment on actuarial gains or losses for the period (60,751,604) Undistributed surplus at the beginning of the period post adjustment 32,467,104,154 Add: net income after tax for the period 18,618,001,540 Distributable earnings 51,085,105,694 Less: legal reserve from surplus Less: special reserve from surplus Distribution items: Less: cash dividends Undistributed earnings at the end of the period Notes: Employees Bonus in Cash Remuneration to Directors and Supervisors (1,861,800,154) (3,310,791,096) (14,677,984,242) 31,234,530,202 1,666,000,000 40,000,000 Note: The stock dividend is NT$0 per share, cash dividend is NT$3.80 per share

4 Voting Results: The number of votes casted for the proposal was 2,823,366,264 or 80.23% of the votes represented by the shareholders present. RESOLVED, that the allocation of FY2013 retained earnings hereby were accepted as submitted. III. Discussion Items: Item 1. To approve the revision of the Procedures for Acquiring and Disposing of Assets. Description: (1) Under order No issued by the Financial Supervisory Commission on December 30 th, 2013, and to accommodate development of the Company. Adjustments on the Procedures of Acquiring and Disposing of Assets were reported. (2) Comparison of Amendments on Procedures of Acquiring or Disposing of Assets is described in Attachment V. Voting Results: The number of votes casted for the proposal was 2,820,703,559 or 80.15% of the votes represented by the shareholders present. RESOLVED, that the revision of the Procedures for Acquiring and Disposing of Asset hereby were accepted as submitted. IV. Election Items: Item 1. Election of Company Supervisor Description: (1) One vacancy of Supervisor to be elected (2) In accordance to Regulation, the Articles of Incorporation, and the Procedures for Elections of Company Directors and Supervisors, election of supervisors is conducted under the candidate nomination system, where supervisor is elected from the nominated candidates. Please refer to attachment VI for candidate list and background information for Supervisors. Newly appointed Supervisor will assume his or her office after the present shareholders meeting on June 19, 2014 and with term of office expires on June 23, Voting Results: 1. Elected Supervisor: ID No. Name Electoral Vote Counts Note 590 CIANYU INVESTEMENT LTD 2,734,816,693 Shareholders Comments: Shareholder expressed condolence and gratitude toward the late Supervisor. Inquired background information and reasons for recommending the nominated Supervisor. Lastly, recommended the Company to establish communication channel with shareholders to further enhance communication between the Company and - 4 -

5 shareholders. Upon solicitation of comments by Chairman and CFO shareholder had no further comments. V. Special Motion: NONE VI. Meeting Adjourned: 09:45am **In case of any discrepancy between the English and Chinese version of those minutes of 2014 Annual General Shareholders Meeting, the Chinese version shall prevail

6 Attachment I (English Translation of Financial Report Originally Issued In Chinese) - 6 -

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13 Attachment II Business Report The world s economy was hitting the bottom in year 2013 and worldwide notebook market also experienced over 10% of shipment decline. Despite tough challenges from external environment and pressure on internal operation, the challenging environment also created great opportunities for the Company to recharge and to reshape its directions in order to ride on the next big growth driver. Quanta Computer continues to sharpen its competitive edge by following four Corporate principles, including Superior Quality, Superior Technology, Superior Management, and Superior Outcome. Even though overall performance remains under pressure, general business operations were optimized with greater efficiency on product quality, manufacturing costs and automation of logistics. Quanta s performance for FY2013 and outlook for FY2014 are as follow: I. Revenue and Income Consolidated revenue in year 2013 was NT$880.4BN, a decline of 14.11% from the prior year. To adopt changes in industry trend, the Company continues to develop strength in servers, datacenters, tablets, networking and other cloud-related business aside from the current notebook business. The enhanced product mix into non-nb business further helps with margin and profitability improvement. Net income after tax in FY2013 and FY2012 was NT$19.1BN and NT$23.4BN respectively. Net income attributable to owners of parent in FY2013 and FY2012 was NT$18.6BN and NT$23.1BN respectively. EPS in 2013 was NT$4.84, while non-operating income was NT$11.2BN. In terms of research & development, Quanta Computer follows the trend of Computing Will Be 3C and leverages the New 3C concept to position new product development and business model. In order to provide customers with high quality products and service value, Quanta Computer positions itself to act as a System Solution Provider in Cloud Computing business through integrating Cloud Computing, Connectivity, and Client Device. In terms of operations & management, Quanta Computer continues to promote the principle of 3Rs, including Re-think, Re-educate, and Re-invent to act as a forerunner in technology innovation and continue the sail into the new 3C milestone. The Company further accelerates the speed of diversification into other non-notebook business and to explore new business opportunities and lead as a smart integrator, value creator, and service provider. More importantly, the Company continues to identify new business prospects in the area of 3Ss, including System, Software, and Solution. Through developing value chain, leveraging logistics capability and integrating automation, the Company s strength in product development is further enhanced. On the basis of strong design capability and expertise in developing and manufacturing notebook product lines, the Company further devotes research efforts in exploring new technology and new product development. Our continued efforts in diversification and strong progress in cloud business development enabled the Company to achieve a balanced product mix, improved profitability and revenue mix. As a leader in the industry, the Company fully utilizes its competitive edge in global logistic, superior speed and flexibility in product delivery, as well as economy of scale. The optimal goal is to sustain our competitiveness in conjunction with leading edge of research and development skills and innovative design capability. II. Outlook in 2014 The aforementioned four Corporate principles serve as the fundamental guideline for the

14 Company, while, action plans to execute the four Corporate principles are described below: Accelerate manufacturing capacity - Optimize management skills, enhance technical know-how and increase automation to enhance product quality and accelerate manufacturing capacity. Automation - Leverage information system and advanced network to accelerate automation level across all product lines. Further accelerate the adoption of automation in order to increase efficiency. ERP System Leverage ERP system to strictly control and manage material, to avoid missing material and to properly control material management in order to control cost. Changes in production, marketing and supply chain management - Effectively integrate production and marketing through instant management system and supply chain management model on the Web to further enhance production efficiency. Hub Ship To Line - Centralize storage of raw material, simplify process, precise inventory restocking and strict execution on inventory management. Aside from ensuring every Corporate principle and guideline is properly executed, the Company also acts upon the spirit of Innovation is the Core Motive and Changes is the Action Model. The Company has set the target to utilize speed as our competitive strength to further enhance our capability in design, material procurement, vendor selection, manufacturing method and process, as well as daily operation and management. In order to discover new business opportunities and to create greater profitability, the Company further accelerates our technical capability in 3C product development, value chain creation, full automation, strong inventory management and full integration of supplier and manufacturing. All of which is to reach the optimal goal of customer satisfaction and share the fruitful results with our valued shareholders

15 Attachment III Supervisors Review Report 08 May 2014 The Board of Directors have prepared and submitted to us the Company's 2013 Financial Statement and audit report which have been audited and certified by KPMG, along with the business report and proposal for profit allocation. We, the Supervisors, have duly examined the same as correct and accurate. We hereby report to the 2014 Annual General Meeting of Shareholders in accordance to Article 219 of the Company Law. Quanta Computer lnc. Supervisors: Eddie Lee ( 李政霖 ) Steven Chang ( 張景溢 )

16 Attachment IV The Impact of Stock Dividend Issuance on Business Performance, EPS, and Shareholder Return Rate Not available (Company does not simulate or report financial forecast for year 2014, and therefore there will be no forecasted profit or EPS.)

17 Attachment V. Amendments to the Procedures of Acquiring or Disposing of Assets Quanta Computer Inc. Comparison of Amendments to the Procedures of Acquiring or Disposing of Assets Before Amendment After Amendment Remark Chapter 1: General Principle Article 1: To protect the best interest of shareholders, comply with relevant laws and enhance the management of the Company s Procedures of Acquiring or Disposing of Assets, these procedures are amended in accordance with Article 36-1 of the Securities and Exchange Law and related regulations governed by the Security and Futures Bureau under the Ministry of Finance, R.O.C. Chapter 1: General Principle Article 1: To protect the best interest of shareholders, comply with relevant laws and enhance the management of the Company s Procedures of Acquiring or Disposing of Assets, these procedures are amended in accordance with Article 36-1 of the Securities and Exchange Law and related regulations governed by the Financial Supervisory Commission R.O.C. Article 3 The scope of applicability of the term assets as used in these Procedures shall be as follow: (1) Long-term and short-term investments including stocks, government bonds, corporate bonds, financial bonds, negotiable securities in funds, depositary receipts, call (put) warrants, beneficiary securities, asset-backed securities and etc. (2) Fixed assets (including construction inventory) and other fixed assets. (3) Membership certificates. (4) Intangible assets, such as patents, copyrights, trademarks, concession rights, and etc. (5) Liabilities from financial institutes (including account receivables, loan Article 3 The scope of applicability of the term assets as used in these Procedures shall be as follow: (1) Long-term and short-term investments including stocks, government bonds, corporate bonds, financial bonds, negotiable securities in funds, depositary receipts, call (put) warrants, beneficiary securities, assetbacked securities and etc. (2) Fixed assets (including land, real estate and building, investment real estate and ownership of land) and equipment. (3) Membership certificates. (4) Intangible assets, such as patents, copyrights, trademarks, concession rights, and etc. (5) Liabilities from financial institutes (including Amend in accordance to title changes for the regulatory bureau. Amend in accordance to adoption of the IFRSs and relevant regulations

18 remittance and discounts, and past due receivables). (6) Derivative products. (7) Assets acquired or disposed through mergers, splits, acquisition or shares transference in accordance to laws. (8) Other important assets. Article 4 Terms used in these procedures are defined as follow: (1) (2) (3) Related party: as defined in Statement of Financial Accounting Standards No. 6, published by the ROC Accounting Research and Development Foundation (herein referred to as the Accounting R&D Foundation ). (4) Subsidiary: As defined in Statements of Financial Accounting Standards, No. 5 and No. 7 published by the Accounting R&D Foundation. (5) Professional appraiser: a real estate appraiser or other persons authorized by law to engage in the value appraisal of real estate and other fixed asset. (6) Date of occurrence: the date of transaction contract signing, date of payment, date of consignment trading, date of transfer, date of resolution of Board of Directors, or other date sufficient to confirm the counterparty and amount of the transaction, whichever date is earlier. However, for investment for which approval of the competent authority is required, the earlier of the above date or account receivables, loan remittance and discounts, and past due receivables). (6) Derivative products. (7) Assets acquired or disposed through mergers, splits, acquisition or shares transference in accordance to laws. (8) Other important assets. Article 4 Terms used in these procedures are defined as follow: (1) (2) (3) Related party & Subsidiary: as defined in accordance to regulations governing the preparation of financial reports by securities issuers. (4) Subsidiary: As defined in Statements of Financial Accounting Standards, No. 5 and No. 7 published by the Accounting R&D Foundation. (4) Professional appraiser: a real estate appraiser or other persons authorized by law to engage in the value appraisal of real estate and equipment. (5) Date of occurrence: the date of transaction contract signing, date of payment, date of consignment trading, date of transfer, date of resolution of Board of Directors, or other date sufficient to confirm the counterparty and amount of the transaction, whichever date is earlier. However, for investment for which approval of the competent authority is required, the earlier of the above date or the date of receipt of approval from the competent authority shall apply. Amend in accordance to Company Law and relevant regulations governed by the IFRSs

19 the date of receipt of approval from the competent authority shall apply. (7) Mainland area investment: investment in China approved by the Investment Commission, Ministry of Economic Affairs or conducted in accordance to the provisions of the Regulations Governing Permission for Investment or Technical Cooperation in the Mainland Area. (8) Most recent financial statement: financial statements audited or reviewed by an accountant in accordance to relevant laws prior to the date of the event when the Company acquires or disposes assets. Chapter 2: Procedure Section I: Acquiring or Disposing of Assets Article 7: Procedures for the Acquisition or Disposal of Assets: Sub-Section I. Procedure of Evaluation and Operation (1). (2) Prior to the date of the event when the acquisition or disposal of securities takes place, the latest financial statements of the object company audited or reviewed by certified public accountant should be obtained for assessment and reference of transaction price. Should the transaction price reaches 20% of this Company's paid-in capital or exceeds NT$300 million, opinions in respect of a rational (6) Mainland area investment: investment in China approved by the Investment Commission, Ministry of Economic Affairs or conducted in accordance to the provisions of the Regulations Governing Permission for Investment or Technical Cooperation in the Mainland Area. (7) Most recent financial statement: financial statements audited or reviewed by an accountant in accordance to relevant laws prior to the date of the event when the Company acquires or disposes assets. Chapter 2: Procedure Section I: Acquiring or Disposing of Assets Article 7: Procedures for the Acquisition or Disposal of Assets: Sub-Section I. Procedure of Evaluation and Operation (1). (2) Prior to the date of the event when the acquisition or disposal of securities takes place, the latest financial statements of the object company audited or reviewed by certified public accountant should be obtained for assessment and reference of transaction price. Should the transaction price reaches 20% of this Company's paid-in capital or exceeds NT$300 million, opinions in respect of a rational Amend in accordance to adoption of the IFRSs and adjust wording used to describe other fixed assets and operating machinery equipment

20 transaction price have to be sought from certified public accountant prior to the date of the event; provided however, should the certified public accountant chose to leverage an appraisal report issued by Professional Appraiser, the Company should request the accountant to handle the matter in accordance with the provision of Auditing Standard No. 20 governed by Accounting Research and Development Foundation. These requirements are not applicable if such securities have a public price from an active market or if the regulatory authorities require otherwise. (3) Should the transaction price of acquiring or disposing real estate or other fixed assets reaches 20% of this Company s paid-in capital or exceeds NT$300 million, opinions in respect of a rational transaction price have to be sought from appraisal reports issued by Professional Appraiser prior to the date of the event and shall comply with the Procedure of Evaluation and Operation stated in this Procedure. Related party transactions shall comply with the procedure stated in Chapter 2 Section II. (4) (5) In addition to referencing professional appraiser reports, accountants and other professional opinions, price determining method and reference basis that the Company leverages when transaction price have to be sought from certified public accountant prior to the date of the event; provided however, should the certified public accountant chose to leverage an appraisal report issued by Professional Appraiser, the Company should request the accountant to handle the matter in accordance with the provision of Auditing Standard No. 20 governed by Accounting Research and Development Foundation, R.O.C. These requirements are not applicable if such securities have a public price from an active market or if the regulatory authorities require otherwise. (3) Should the transaction price of acquiring or disposing real estate or equipment reaches 20% of this Company s paid-in capital or exceeds NT$300 million, opinions in respect of a rational transaction price have to be sought from appraisal reports issued by Professional Appraiser prior to the date of the event and shall comply with the Procedure of Evaluation and Operation stated in this Procedure. Related party transactions shall comply with the procedure stated in Chapter 2 Section II. (4) (5) In addition to referencing professional appraiser reports, accountants and other professional opinions, price determining method and reference basis that the Company leverages when acquiring or disposing of

21 acquiring or disposing of assets should also follow procedures stated below: I. II. III. IV. The transaction price of acquiring or disposing of real estate or other fixed assets shall reference the publicly announced value, appraised price, actual transaction price in neighboring area, face value or appraised price from suppliers to determine conditions and price. If acquiring real estate from the related party, calculation of pricing shall first comply with the Procedure stated in Chapter 2 Section II to determine the fairness of transaction price. V. Sub-Section II. Terms and conditions of the transaction and level of authorization (1) (2) (3) (4) Others: Should comply with procedures and regulations governed by the Internal Control System and level of authorization. In the event that transaction price reaches amount specified in Chapter 27 for public reporting, all transactions should receive approvals from the Board of Directors first, except when acquiring or disposing operating machinery and equipment that can report to the Board of Directors upon assets should also follow procedures stated below: I. II. III. IV. The transaction price of acquiring or disposing of real estate or equipment shall reference the publicly announced value, appraised price, actual transaction price in neighboring area, face value or appraised price from suppliers to determine conditions and price. If acquiring real estate from the related party, calculation of pricing shall first comply with the Procedure stated in Chapter 2 Section II to determine the fairness of transaction price. V. Sub-Section II. Terms and conditions of the transaction and level of authorization (1) (2) (3) (4) Others: Should comply with procedures and regulations governed by the Internal Control System and level of authorization. In the event that transaction price reaches amount specified in Chapter 27 for public reporting, all transactions should receive approvals from the Board of Directors first, except when acquiring or disposing operating equipment that can report to the Board of Directors upon completion of the transaction. If transaction meets provisions described in Chapter 185 in the Article of Incorporation,

22 completion of the transaction. If transaction meets provisions described in Chapter 185 in the Article of Incorporation, approval from the AGM should be obtained first. Sub-Section III. Execution: When the Company acquires or disposes real estate or other fixed assets, appropriate approval shall be obtained in accordance to the level of authorization and responsible department shall execute accordingly. Sub-Section IV: When the Company acquires or disposes of real estate or other fixed assets, if the transaction amount reaches 20% of this Company s paid-in capital or exceeds NT$300 million, except in transactions with government agencies, hiring others to build on its own land, hiring others to build on rented land, or acquiring or disposing of operating machinery and equipment, it shall first obtain an appraisal report from a professional appraiser and shall further comply with the following provisions: approvals from the AGM should be obtained first. Sub-Section III. Execution: Where the Company acquires or disposes real estate or equipment, appropriate approval shall be obtained in accordance to the level of authorization and responsible department shall execute accordingly. Sub-Section IV: When the Company acquires or disposes of real estate or equipment, if the transaction amount reaches 20% of this Company s paid-in capital or exceeds NT$300 million, except in transactions with government agencies, hiring others to build on its own land, hiring others to build on rented land, or acquiring or disposing of operating equipment, it shall first obtain an appraisal report from a professional appraiser and shall further comply with the following provisions: Sub-Section V: When acquiring or disposing membership certificates or intangible assets where the transaction price reaches 20% of this Company s paidin capital or exceeds NT$300 million, opinions regarding the transaction price from CPA shall be obtained prior to the date of occurrence, except when trading with a government agency. Where CPA s opinion is based on the professional opinions, it shall be prepared in accordance to the provisions of Statement of Auditing Standards No. 20 published

23 Article 9 Decision Making Process: When the Company acquires or disposes real estate or other assets and amount reaches 20% of this Company s paid-in capital or 10% of this Company s total assets or exceeds NT$300 million from a related party, the Company shall prepare the following documentation and submit to the Board of Directors and Supervisors for approval. Contracts can then be signed and payments may proceed. (1) (2) (3) (4) (5) (6) (7) When the Company acquires or disposes operating machinery from its parent company or subsidiary, the Board can authorize the Chairman to handle the matter if the transaction price is less than 1% of the Company s total assets and report to the latest Board of Directors Meeting for recognition on an after-theevent basis. Article 10 Evaluating the reasonableness of the transaction conditions: The Company purchases real estate from the related party and the transaction is exempt by the ARDF. Article 9 Decision Making Process: When the Company acquires or disposes real estate or other assets and amount reaches 20% of this Company s paid-in capital or 10% of this Company s total assets or exceeds NT$300 million from a related party, except when trading government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds. The Company shall prepare the following documentation and submit to the Board of Directors and Supervisors for approval. Contracts can then be signed and payments may proceed. (1) (2) (3) (4) (5) (6) (7) When the Company acquires or disposes operating equipment from its parent company or subsidiary, the Board can authorize the Chairman to handle the matter if the transaction price is less than 1% of the Company s total assets and report to the latest Board of Directors Meeting for recognition on an after-theevent basis. Article 10 Evaluating the reasonableness of the transaction conditions: The Company purchases real estate from the related party and the transaction is exempt Public reporting may be waved when trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds with related parties due to low transaction risk. Thus amendment is made to Article 9. Considering the nature of engaging a related party to build real estate either on the Company s own land or on rented land is similar to acquiring real estate by the joint

24 from the application in the event that the related party acquired real estate by inheritance or as a gift; or more than five years have passed from the time the related party signed the contract to receive the real estate to the signing date of the current transaction; or acquiring real estate by the joint construction contract executed with the related party. In addition to evaluating the cost of real estate pursuant to provisions prescribed in the following three paragraphs, an accountant shall be retained to check and provide specific opinion. Article 19 Internal Control: (1) (2) (3) Where the Company s transactions of derivative products are authorized by the relevant personnel pursuant to the Procedure, the information relevant to the transactions shall be reported to the Board of Directors after the transactions. Article 27: Procedures for Public Reporting: Section I. (1) Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the from the application in the event that the related party acquired real estate by inheritance or as a gift; or more than five years have passed from the time the related party signed the contract to receive the real estate to the signing date of the current transaction; or acquiring real estate by the joint construction contract executed with the related party; or through engaging a related party to build real estate either on the Company s own land or on rented land. In addition to evaluating the cost of real estate pursuant to provisions prescribed in the following three paragraphs, an accountant shall be retained to check and provide specific opinion. Article 19 Internal Control: (1) (2) (3) Where the Company s transactions of derivative products are authorized by the relevant personnel pursuant to the Procedure, the information relevant to the transactions shall be reported to the most recent Board of Directors meeting after the transactions. Article 27: Procedures for Public Reporting: Section I. (1) Acquisition or disposal of real property from or to a related party, or acquisition or disposal of assets other than real property from or to a related party where the construction contract executed with the related party, Article is amended to exempt the condition when the Company acquires real estate through engaging a related party to build real estate on the Company s own land or rented land. Amend in accordance to Regulations. Amend in accordance to Regulations

25 transaction amount reaches 20% or more of paid-in capital, 10% or more of the company's total assets, or exceeds NT$300 million; provided, this shall not apply to trading of government bonds or bonds under repurchase and resale agreements. (2)... (3) (4) I. II. III. Trading of bonds under repurchase/resale agreements. IV. Where the type of asset acquired or disposed is operating machinery equipment, the trading counterparty is not a related party, and the transaction amount is less than NT$500 million. Article 30 Governance of the Company s subsidiary acquiring or disposing of assets: (1) (2) (3) (4) The term transaction amount reaches 20% of this Company s paid-in capital or 10% of this Company s total assets stated in the Procedures for filing and public announcement for subsidiaries refers to the parent company s paid-in transaction amount reaches 20% or more of paid-in capital, 10% or more of the company's total assets, or exceeds NT$300 million; provided, this shall not apply to trading of government bonds or bonds under repurchase and resale agreements, or subscription or redemption of domestic money market funds. (2)... (3) (4) I. II. III. Trading of bonds under repurchase/resale agreements, or subscription or redemption of domestic money market funds. IV. Where the type of asset acquired or disposed is operating equipment, the trading counterparty is not a related party, and the transaction amount is less than NT$500 million. Article 30 Governance of the Company s subsidiary acquiring or disposing of assets: (1) (2) (3) (4) The term transaction amount reaches 20% of this Company s paid-in capital or 10% of this Company s total assets stated in the Procedures for filing and public announcement for subsidiaries refers to the parent company s Amend in accordance to adoption of the IFRSs

26 capital or total assets. Article 30-1 For shares from foreign company whose shares have no par value or a par value other than NT$10, use 10% of the stockholders equity for the calculation of transaction amounts of 20% of paid-in capital stated in these Procedures. financial statement and in compliance with the Procedure Article Article 30-1 For the calculation of 10% of total assets under these Procedures, use total assets stated in the parent company s most recent financial report or individual financial report prepared under the Regulations Governing the Preparation of Financial Reports by Securities Issuers. In the event of a company whose shares have no par value or a par value other than NT$10, for the calculation of transaction amounts of 20% of paid-in capital under these Procedures, use 10% of equity attributable to owners of the parent Company instead. Amend in accordance to adoption of the IFRSs