QUANTA COMPUTER INC. · 2014-05-19 · In order to provide customers with high quality products and service value, Quanta Computer positions itself to act as a “System Solution

[Translation]

Stock Code: 2382

QUANTA COMPUTER INC.

2014 Annual General Shareholders’ Meeting

Meeting Handbook

June 19, 2014

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Meeting Procedure

I. Call Meeting to Order

II. Chairman in Position

III. Chairman’s Address

IV. Report Items

V. Proposed Resolutions

VI. Discussion Items

VII. Election Items

VIII. Other Business and Special Motion

IX. Meeting Adjourned

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Table of Contents

Meeting Agenda ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 4

Report Items ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 5

Proposed for Approval Items‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 5

Proposed for Discussion Items ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 6

Election Items ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥

Other Business and Special Motion ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥

Meeting Adjourned ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥

7

7

7

Attachment I. 2013 Consolidated Financial Statements ‥‥‥‥‥‥‥‥‥‥ 8

Attachment II. Business Report ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 15

Attachment III. Supervisors’ Review Report ‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 17

Attachment IV. The Impact of Stock Dividend Issuance on Business Performance,

EPS, and Shareholder Return Rate‥‥‥‥‥‥‥‥‥‥‥‥‥

18

Attachment V. Amendment to the Acquiring and Disposing of Assets‥‥‥‥‥ 19

Attachment VI. Candidate List for Supervisor‥‥‥‥‥‥‥‥‥‥‥‥‥‥‥ 29

Attachment VII. Shareholdings of Directors and Supervisor‥‥‥‥‥‥‥‥‥‥ 30

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Agenda

I. Time: June 19, 2014 (Thursday) at 9:00 am

II. Venue: Quanta Computer (No. 188, Wen-Hwa 2nd Road, Kuei Shan, Taoyuan Shien, Taiwan)

III. Chairman call meeting to order

IV. Chairman’s address

V. Report Items: None

VI. Proposed for Approval Items

1. To accept FY2013 business report and financial statements (including

independent auditor's report and supervisor's review report)

2. To approve the allocation of FY2013 retained earnings

VII. Proposed for Discussion Items

1. To approve the revision of Procedures for Acquiring and Disposing of Assets.

VIII. Election Items

1. Election of One Supervisor

IX. Special Motion

X. Meeting Adjourned

NOTE: Each reporting item and proposal will proceed voting by poll and voting will be conducted

after all proposals have been presented.

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Report Items

NONE

Proposed for Approval Items

Item 1. (Proposed by the Board of Directors)

Proposal: To accept FY2013 business report and financial statements (including independent

auditor's report and supervisor's review report)

Description:

(1) Quanta Computer’s 2013 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

page 8 to 14 of this Handbook, and for financial reports please refer to website:

http://mops.tse.com.tw

Resolution:


Proposal: 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.

http://mops.tse.com.tw/

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Quanta Computer Inc.

2013 Statement of Distribution of Retained Earnings Unit: NT$

Item Total

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

32,781,093,587

(270,731,486)

17,493,657

Undistributed surplus at the beginning of the period (IFRS)

Less: adjustment on actuarial gains or losses for the period

32,527,855,758

(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

(1,861,800,154)

(3,310,791,096)

Distribution items:

Less: cash dividends

Undistributed earnings at the end of the period

Notes:

(14,677,984,242)

31,234,530,202

1,666,000,000

40,000,000

Employees’ Bonus in Cash

Remuneration to Directors and Supervisors

Note: The stock dividend is NT$0 per share, cash dividend is NT$3.80 per share.

Resolution:

Proposed for Discussion Items


Proposal: To approve the revision of the Procedures for Acquiring and Disposing of Assets.

Description:

(1) Under order No. 1020053073 issued by the Financial Supervisory Commission on

December 30th

, 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.

Resolution:

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Election Item


Proposal: 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, 2016.

(3) Please elect

Resolution:

Other Business and Special Motion

Meeting Adjourned

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Attachment I

(English Translation of Financial Report Originally Issued In Chinese)

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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

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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.

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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)

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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.)

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Attachment V. Amendments to the Procedures of Acquiring or Disposing of Assets


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.

Amend in accordance to

title changes for the

regulatory bureau.

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, asset-

backed 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


adoption of the IFRSs

and relevant regulations.

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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.

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: 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

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.


Company Law and

relevant regulations

governed by the IFRSs.

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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.

(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

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


20% of this Company's


NT$300 million, opinions

in respect of a rational


adoption of the IFRSs

and adjust wording used

to describe other fixed

assets and operating

machinery equipment.

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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

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assets should also follow

procedures stated below:

I. …

II. …

III. …

IV. The transaction price 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


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,

- 24 -

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:


or disposes of real estate or

other fixed assets, if the

transaction amount reaches

20% of this Company’s


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:


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


20% of this Company’s paid-

in 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

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by the ARDF.

Article 9

Decision Making Process:



other assets and amount

reaches 20% of this


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) …


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-the-

event basis.

Article 9

Decision Making Process:



other assets and amount

reaches 20% of this


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) …


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-the-

event basis.

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.

Article 10

Evaluating the

reasonableness of the

transaction conditions:

The Company purchases real

estate from the related party

and the transaction is exempt

Article 10

Evaluating the

reasonableness of the

transaction conditions:

The Company purchases real

estate from the related party

and the transaction is exempt

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

- 26 -

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.

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


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.

construction contract


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.

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 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.


Regulations.

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

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


Regulations.

- 27 -

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


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.

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


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 paid-in

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


adoption of the IFRSs.

- 28 -

capital or total assets. financial statement and in

compliance with the

Procedure Article 30-1.

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.

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.


adoption of the IFRSs.

Attachment VI.


2014 Supervisors Candidate List

In accordance to:

1. Regulation No. 192-1 and No. 216-1stated in the Company Law.

2. Qualification of the candidate for 2013 Supervisor election has been reviewed by the Board of Directors Meeting held on May 8th, 2014.

Qualified Supervisor candidate list has been enclosed in the 2014 Annual General Shareholders’ Meeting scheduled on June 19th, 2014.

Detailed background information regarding the candidate is listed below:

Title Name Education Experience Present Position Con-current

Job Posts Shareholdings

Representative

of Government

or Institutional

Investors

Other

Information

Supervisor CIANYU

INVESTEMENT

LTD

N/A N/A N/A N/A 572,401,374 N/A N/A

- 30 -

Attachment VII.


Shareholdings of Directors and Supervisors as of April 21, 2014

Position Name Elected Date

Common Shares Held at

Previous Election Current Common Shares Held

Note

Number of

Common

Shares

Percentage of

Total Issued and

Outstanding

Common Shares

Number of

Common

Shares

Percentage of

Total Issued and

Outstanding

Common Shares

Chairman Barry Lam 2013.06.24 445,738,138 11.56% 445,738,138 11.54%

Vice-Chairman C.C. Leung 2013.06.24 115,645,736 3.00% 115,645,736 2.99%

Director C.T. Huang 2013.06.24 7,078,197 0.18% 10,042,197 0.26% Other entitlement of

4,000,000 shares

Independent

Director Wei-Ta Pan 2013.06.24 6,717 0.00% 6,717 0.00%

Independent

Director Chi-Chih Lu 2013.06.24 0 0.00% 0 0.00%

Supervisor Eddie Lee 2013.06.24 0 0.00% 0 0.00%

Supervisor Steven Chang 2013.06.24 0 0.00% 0 0.00%

Total 568,468,788 571,432,788

Note 1: Issued Capital Stock on June 24, 2013: 3,854,258,432 shares at NT$ 10 par value

Note 2: Issued Capital Stock on April 21, 2014: 3,862,627,432 shares at NT$ 10 par value

Note 3: QCI’s Directors are required to hold in the aggregate no less than 92,703,058 QCI shares. As of April 21, 2014, QCI’s Directors

together held 571,426,071 QCI shares

Note 4: QCI’s Supervisors are required to hold in the aggregate no less than 9,270,305 QCI shares. As of April 21, 2014, QCI’s Supervisors

together held 0 QCI shares

Note 5: Independent Directors and Supervisors’ shareholdings are not included in the required amount.

Documents

QUANTA COMPUTER INC. · 2014-05-19 · In order to provide customers with high quality products and service value, Quanta Computer positions itself to act as a “System Solution