If there is any profit in a fiscal year, the Company’s pre-tax profits in such fiscal year, prior to deduction of compensations to employees and directors, shall be distributed to employees as compensation in an amount of 2%~8% of thereof and to directors as compensation in an amount of not more than 2% of such profits. The Company may distribute in the ways of shares or cash to employees, employees of subsidiaries of the Company, which depends on certain specific requirements determined by the Board of Directors. The aforementioned compensations to directors can only be distributed by cash. The distribution of employees’ and directors’ compensation shall be reported to the Annual General Meeting. In the event that the Company has accumulated losses, the Company shall reserve an amount to offset accumulated losses.

When allocating the net profit for each fiscal year, the Company shall first offset its losses in previous years and then set aside the legal reserve at 10% of net profit until the accumulated legal reserve equals the Company’s capital; and also set aside special reserve in accordance with relevant regulations or as requested by the authorities. Any balance left over and the beginning balance of retained earnings shall be distributed. The earnings appropriations proposal shall be proposed by the Board of Directors and approved by the Annual General Meeting.

The Board of Directors shall prepare the proposal for distribution and submit it to the Annual General Meeting for approval after taking into account company profits, capital and financial structure, future business demands, retained earnings, legal reserve, and market competition conditions at the end of every fiscal year.

The company’s dividend policy adopts a conservative principle for distribution. If there is a surplus in the company’s annual final accounts, after paying taxes, offsetting accumulated losses, setting aside legal reserve, and setting aside or reversing special reserve according to Law Article 29-1 and statutory regulations, no less than 50% of the remaining amount shall be allocated as dividends to shareholders. Furthermore, to sound the company’s financial structure, cash dividends shall account for at least 50% of the total dividends distributed in the current year.

Based on the principle of dividend balancing, if the company has no distributable surplus in the current year, or if there is a surplus but the amount is significantly lower than the actual surplus distributed in the previous year, the whole or a part of the reserve or unappropriated retained earnings from previous periods may be distributed in accordance with laws and regulations or provisions of the competent authority. If there is a disposal of real estate, equity investment, or intangible assets, or income received due to litigation or commercial disputes in the current year, the whole or a part of the difference between the disposal amount and the acquisition cost, or the income, may be retained and shall not be subject to the distribution ratio restrictions in the first paragraph of this Article.