CTBC Financial : Notice for the Convention of the 2023 Annual General Meeting

CTBC Financial Holding Co., Ltd.

Notice for the Convention of the 2023 Annual General Meeting

1. Time and location
2. 1. Date and time: 9:00 AM, June 16, 2023
   2. Location: 12F., The Grand Ballroom, The Grand Hotel, No. 1, Zhongshan N. Rd., Sec. 4, Taipei, Taiwan, R.O.C.
3. Reasons for convening the meeting
4. 1. 1. Items to Report
      2. 1. 2022 Business Report
         2. 2022 Audit Committee Report and communication between the Audit Committee and the Chief Auditor
         3. 2022 report on employee and director remuneration distribution
         4. Matters relating to the 2022-2 unsecured corporate bonds issued in 2022 of NT$3.7 billion
   2. Items for Acceptance
   3. 1. 1. 2022 Business Report, Independent Auditors' Report, and Financial Statements
         2. 2022 earnings distribution plan
      2. Items for Discussion
      3. 1. Amendments to the Articles of Incorporation
         2. Approval of issuing 2023 restricted stock awards
   1. Questions and Motions
5. Other matters that need to be specified
6. 1. The distributable earnings of 2022 are proposed to be distributed as follows:
      1. Since the current Articles of Incorporation have not yet clarified whether dividends of preferred shares can be distributed from accumulated undistributed earnings, dividends of preferred shares will not be distributed temporarily. And since the board of directors has approved the proposal to amend the Articles of Incorporation, after the amendment is approved at shareholders' meeting on 2023/6/16, the board of directors may hold an extraordinary shareholders' meeting to discuss the distribution of dividends of preferred shares, and plan to distribute dividends of preferred shares with the same amount as the earnings distribution plan for the year 2021.

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1. 1. As of April 18, 2023 The Company has issued a total of 19,583,800,786 common shares. In consideration of meeting the Company's business expansion needs and maintaining an adequate capital level, it is proposed to distribute common share cash dividends totaling NT$19,583,800,786 at NT$1 per share.
   2. The common share cash dividends shall be allocated to individual shareholders by rounding down to the nearest NT$1 (decimals are not taken into account), and the sum of all fractional dividends less than NT$1 shall be recognized as other income of the Company.
2. The Company proposes issuing 2023 restricted stock awards (RSA). The key points of this proposal are as follows:
3. 1. Expected total amount (shares) of issuance: A total of no greater than 50,000,000 new common shares will be issued. The actual number of shares to be issued will be resolved by the Board of Directors after the issuance of the RSA is approved at the shareholders' meeting and by the competent authority.
   2. Employee qualifications and allotted shares: This incentive plan is applicable to regular (full-time) employees of the Company or one of its controlling companies or subordinates. Employees must remain employed by the Company on the last day of the vesting period (i.e.,
      2026/12/31) to be eligible. Individuals who hold more than 10% of the Company's total issued shares are not eligible. Where the Company issues employee stock warrants under Article 56-1, paragraph 1 of the Regulations Governing the Offering and Issuance of Securities, the cumulative number of shares subscribable by a single employee of the employee stock warrants, in combination with the cumulative number of new restricted employee shares obtained by the single employee, may not exceed 0.3% of the Company's total issued shares. And the above in combination with the cumulative number of shares subscribable by the single employee of employee stock warrants issued by the Company under Article 56, paragraph 1 of the Regulations Governing the Offering and Issuance of Securities, may not exceed 1% of the
      Company's total issued shares. The RSA qualifications for employee types 1 and 2 are as follows:
   3. 1. Type 1: Vice President and above and employees in special positions.
      2. Type 2: Newly appointed employees in key positions related to important Company strategy

and operation in 2023, or employees who propose active and challenge goals in response to the 3th Five-year Plan of the Company.

The respective numbers of restricted shares that employees are awarded shall be approved by the Chairman, Audit Committee and the Board, taking into consideration factors including but not

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limited to grantees' seniority, ranking, performance, and expected contribution to overall corporate performance objectives. Whether employees who are managers receive the RSA must be approved by the Remuneration Committee and the Board.

1. 1. Main points of RSA issuance:
   2. 1. Expected issue price: Grants will be issued free of charge.
      2. Vesting conditions: To meet the requirements which are mentioned in 2023 Restricted Stock Awards Regulations of the Company.
      3. Measures to be taken for employees who do not meet the vesting conditions or in the event of inheritance: Where the vesting conditions are not fulfilled, the Restricted Shares granted will be forfeited and cancelled by the Company; in the case of exceptional events, the Company will proceed as set forth in 2023 Restricted Stock Awards Regulations of the Company.
   3. Calculated expense amount, dilution of the Company's earnings per share (EPS), and other matters affecting shareholders' equity: A total of no greater than 50,000,000 new common shares will be issued, accounting for approximately 0.26% of the Company's total outstanding shares.
      If all vesting conditions are met, the pro forma maximum total expense, calculated using the average closing common stock price of NT$22.625 in February 2023, would amount to NT$1,131.2 million. Assuming all common stocks are granted in September 2023, the annual expenses from 2023 to 2027 would be NT$87.02 million, NT$261.06 million, NT$ 261.06 million, NT$ 261.06 million, and NT$ 261.06 million, respectively. Based on the Company's
      19,583,801,000 outstanding shares, the potential impact of the abovementioned expenses on the
      Company's EPS from 2023 to 2027 is preliminarily estimated at approximately NT$0.00,
      NT$0.01, NT$0.01, NT$0.01, and NT$0.01, respectively. The potential dilution of the
      Company's EPS is minimal; therefore, there would be no material impact on shareholders' interests. However, the actual expense amount will be calculated in accordance with the relevant accounting principles, taking into consideration the Company's share price on the issuance date and the best estimation of the achievement of various performance indicators during the vesting period.
   4. Granted RSA will be deposited in a stock trust custody account.
2. Pursuant to the Company's Articles of Incorporation and the issuance conditions of the Preferred Share B and Preferred Share C, the shareholders of the Preferred Share B and Preferred Share C have no voting right at the shareholders' meeting. However, such shareholders are entitled to be elected as a director of the Company and have the voting right at preferred shareholders' meetings and on matters related to rights and obligations of preferred shareholders at the shareholders' meeting. Therefore, the shareholders of the Preferred Share B and Preferred Share C only have the

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voting right on the Proposal 6 "2022 earnings distribution plan" of the Items for Acceptance and the Proposal 7 "Amendments to the Articles of Incorporation" of the Items for Discussion.

1. The hybrid shareholders' meeting will be convened this year. Shareholders can attend the shareholders' meeting either in person or virtually. Shareholders who intend to participate virtually, please refer to the relevant matters for convening hybrid shareholders' meeting in the Chinese

version of shareholders' meeting notice.

• Virtual Meeting Platform：
  Adopt the Virtual Meeting Platform of Taiwan Depository & Clearing Corporation (TDCC)

【https://www.stockvote.com.tw】

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