Dividends

Under the Company’s Articles of Incorporation, when distributing the current year’s earnings, the Company shall first pay all taxes and offset prior years’ operating losses and then set aside 10% as legal reserve, and special reserve is set aside or reversed in accordance with related laws. The remaining shall first be distributed as dividends of preference shares in accordance with the
rules and then be distributed as dividends of common stocks and bonus. 5% to 85% of remaining amount will be distributed if current earnings per share is not lower than $1. When the Company has a distribution plan for dividends and bonuses or capital reserve in the form of cash, pursuant to Article 240, paragraph 5 and Article 241 of the Company Act, the distribution plan has been adopted by a majority vote at a meeting of the board of directors attended by two-thirds of the total number of directors; and in addition thereto a report of such distribution shall be submitted to the shareholders’ meeting.
The Company adopts balanced and stable principles for its dividends policy and takes into account profitability, financial structure, the future development of the Company, and other factors. The primary considerations for the distribution of dividends shall be the current state of the industry, as well as the Company’s future operational expansion plans and its cash flow needs; therefore, the distribution of dividends shall be no more than 15% stock dividends. The Board of Directors may adjust the distribution rates within the above range based on current operations and capital position and propose the adjustments to the shareholders for approval.