Mega Financial : Shareholders meeting Minutes in 2024

Mega Financial Holding Company

Minutes of the 2024 Annual General Shareholders' Meeting

Date and Time: 9:00 a.m., June 21, 2024

Shareholders meeting will be held by means of: physical shareholders' meeting

Venue: 13/F, Jilin Bldg. of Mega International Commercial Bank, No. 100, Jilin Road, Taipei, Taiwan, R.O.C.

Attendance: The number of shares in attendance is 9,955,940,540 shares (including 8,866,104,763 shares attended through electronic means). This constitutes 76.85％ of the total 12,953,688,836 shares issued, excluding 1,447,649,302 shares retained in China.

Attending directors (9 directors, More than half of the directors) : Directors(7 directors )

Chung-Dar Lei, Yu-Mei Hsiao , Pei-Chun Chen, Yih-Jiuan Wu, Hui-Chuan Chen Po-Cheng Chen, I-Kan Chiu

Independent Directors(2 Independent Directors)

Ying Wu (Chairperson of Audit Committee), Chang-Ching Lin

Observers:

Hwa-Inn Kai, Attorney-at-Law, Partner, Lotus International Law Office

Puo-Ju Kuo, CPA, PricewaterhouseCoopers, Taiwan

Chairman: Chung-Dar Lei, Chairman of the Board of Directors

Minutes taken down by Chia-Lin Chang, Ching-Lun Liao

1. Announce a quorum is present and call the meeting to order
2. Chairman's Remarks (omitted)
3. Reports Items
   Proposal 1：2023 Business Report. (Proposed by the Board of Directors)
   Explanation：The 2023 Business Report is attached as Attachment 1. (Noted)
   Proposal 2：The Audit Committee's Review Report on 2023 Business Report, Consolidated

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Financial Statements and the Proposal for Distribution of 2023 Earnings. (Proposed by the Board of Directors)

Explanation: The Audit Committee's Review Report is attached as Attachment 2.

Statement Summary:

1.Shareholder No. 600337: Expressed recognition for the Group's operating performance and excellence of the management teams, and hoped that the stock price will move towards NT$50. (The Chairman: Thank you for your recognition. We will continue making our best efforts.)

(Noted)

Proposal 3：The Distribution of Directors' and Employees' Compensation for 2023. (Proposed by the Board of Directors)

Explanation:

1. This proposal is made in accordance with Article 31-1 of the Company's Articles of Incorporation.
2. The Company provided NT$166,759,926 (appropriation rate being 0.5％) and NT$25,347,508 (appropriation rate being 0.076％) as the remuneration to directors and employees respectively for 2023, paid in cash only.
3. This proposal has been approved by the 38th meeting of the 8th term of Board of Directors on March 12, 2024.

(Noted)

Proposal 4：The Company's issuance of Corporate Bonds in 2023. (Proposed by the Board of Directors)

Explanation:

1. The Company's Board approved the issuance of unsecured corporate bonds for an amount of up to NT$10 billion on June 27, 2023, and the Company raised NT$10 billion on August 24, 2023. All the raised funds were used to repay loans from financial institutions.
2. The key terms of the bonds are as follows, and the whole terms is attached as
   Attachment 3 .

Issue	Tranche	Terms	Issue Amount	Coupon Rate	Issue Date	Maturity
of Bond	Date
112-1	A	3 years	NT$1.2 billion	Fixed Rate 1.50%	2023.8.24	2026.8.24
112-1	B	5 years	NT$6.6 billion	Fixed Rate 1.60%	2023.8.24	2028.8.24
112-1	C	7 years	NT$2.2 billion	Fixed Rate 1.64%	2023.8.24	2030.8.24

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(Noted)

Proposal 5：Amendment to the "Principles for Ethical Management". (Proposed by the Board of Directors)

Explanation：

1. The company's "Principles for Ethical Management" was made on March 25, 2014, and has been amended two times during the period.
2. In conjunction with the renaming of internal organization, the Board of Directors hereby approved the third amendment on April 23, 2024 as follows:
3. 1. Article 1-1: In conjunction with the renaming of departments, the Principles are amended to accommodate the current department names.
   2. Article 28: This is a new article to add the revision (amendment) process of the Principles.
4. The Company's "Principles for Ethical Management" is herewith attached as Attachment 4.

(Noted)

4. Matters for Recognition

(There were two motions for acknowledgment in this session. After discussing the motions one- by-one, they were voted and counted aggregately in one voting session, and the outcomes were announced separately; the Chairman designated Mr. Chih-Yuan Chang (shareholder No. 1131281) and Mr. Chien-Chung Yen (shareholder No. 1131370) to serve as ballot examiners, whereas employees of the stock transfer agent - Yuanta Securities served as the ballot counters)

Proposal 1：2023 Business Report and Consolidated Financial Statements. (Proposed by the Board of Directors)

Explanation: The Company's 2023 consolidated financial statements have been audited by CPA Kuo, Puo-Ju and Lai, Chung-Hsi of PricewaterhouseCoopers, Taiwan. The above- mentioned 2023 business report and consolidated financial statements have been approved by the Board and reviewed by the Audit Committee. The 2023 business report and consolidated financial statements are attached as Attachment 1 and

Attachment 5.

Summary of meeting proceeding and method of resolution:

The emcee read out the purpose of the motion and made relevant explanations, and no shareholder requested to speak. The Chairman then made the decision to vote in aggregate after all the motions proposed for acknowledgment have been discussed individually.

Outcome of vote:

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The total number of voting rights represented by attending shareholders (including electronic votes) for this motion was 9,955,890,059:

Approval votes/	Disapproval votes/	Abstention votes/	Invalid votes/
percentage	percentage	percentage	percentage
9,123,925,371	8,861,292	823,097,706	5,690
91.64%	0.08%	8.26%	0.00%

Motion was passed as proposed through vote.

Resolution: Approved as proposed.

Proposal 2：The Proposal for Distribution of 2023 Earnings. (Proposed by the Board of Directors)

Explanation:

1. The 2023 financial statements have been audited by PricewaterhouseCoopers, Taiwan. The net profit after income tax of the Company in 2023 is NT$33,246,977,273, after plusing Gain on disposal of investments in equity instruments measured at fair value through other comprehensive income amounted to be NT$867,399,602, Reversal of special reserve for first-time adoption of TIFRS amounted to be NT$2,586,853 and deducting Remeasurements of defined benefit plans amounted to be NT$995,445,434, the 2023 distributable earnings is NT$33,121,518,294, of which needs to deduct the provision for 10% legal reserve NT$3,312,151,829, plus Reversal of special reserve for other equity reduction NT$13,625,011,623 and the previous retained earnings of 2023 NT$25,307,930,504; therefore, the total distributable earnings is NT$68,742,308,592 and the 2023 distributable earnings shall be distributed as a priority as follows:
2. 1. NT$21,602,007,207 as cash dividends (NT$1.5 per share)
   2. NT$4,320,401,440 as stock dividends (NT$0.3 per share)
   3. The balance of unappropriated retained earnings after distribution is NT$42,819,899,945.
3. In order to execute this proposal, the annual general shareholders' meeting is proposed to authorize the Board to do the following:
4. 1. To set the ex-dividend date.
   2. To set the ex-right date after the stock dividends approved by the competent authority.
   3. To deal with relevant changes if the number of the outstanding shares is changed due to share buyback, transfer, conversion, cancellation of

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treasury shares or other circumstances that affect dividend payout ratio.

1. 2023 Earnings Distribution Statement is attached as Attachment 6.
2. This proposal has been approved by the 39th meeting of the 8th term of Board of Directors held on April 23, 2024.

Summary of meeting proceeding and method of resolution:

The emcee read out the purpose of the motion and made relevant explanations, and the following shareholders requested to speak:

Statement Summary:

1. Shareholder No. 0962593: (1) Expressed recognition and gratitude for Chairman Lei's implementation of employee shareholding trust for the Group's subsidiaries after taking office. (2) Provided suggestions on adopting ESG, energy conservation, carbon reduction, paperless, and digital transformation practices. (3) Expressed hope to see the welfare of Mega Securities' employees being associated with organizational performance, as well as the signing of collective bargaining agreement with the labor union of Mega Securities. (The Chairman: (1) The board of directors of the financial holding company passed a resolution on November 28 last year to expand the employee shareholding trust to include group subsidiaries, thereby benefiting approximately 2,800 employees. The Company also increased food allowance for group employees in line with government policies. My business philosophy is to treat every member of Mega Group as family. Companies that perform well will surely reward stakeholders without disappointment. (2) The securities segment delivered strong profit performance last year. I would like to thank all colleagues of Mega Securities as well as Chairman Chen and General Manager Wu for their efforts, and encourage employees to continue making contributions to environmental protection, reducing paper and power usage as part of the Group's ESG initiative.)
2. Shareholder No. 0718956: Thanked Chairman Lei for supporting the Chung Kuo Insurance Labor Union by increasing employees' welfare and rewards. The shareholder expressed recognition for the Chairman's efforts at promoting harmony between labor and management and for making Chung Kuo Insurance a satisfying workplace. (The Chairman: Thanks to Chairman Chang of Chung Kuo Insurance Labor Union for the affirmation. The financial holding company treats each of its subsidiaries a member of one big family and shares all benefits. The Group has planned its employee shareholding trust and meal allowances based on this principle. In addition, considering that employees of Chung Kuo Insurance should not be held entirely accountable for the incident involving claim of COVID-19 insurance, the Group has decided to pay bonus out of empathy for the stress that employees had endured while handling claims. We hope to see our businesses move past the COVID-19 insurance slump and resume the growth track at an earlier time.)

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This motion was thoroughly discussed among shareholders. The Chairman decided that, since all motions proposed for acknowledgment had been individually discussed, a voting session shall be held to vote on all motions raised for acknowledgment.

Outcome of vote:

The total number of voting rights represented by attending shareholders (including electronic votes) for this motion was 9,955,890,059:

Approval votes/	Disapproval votes/	Abstention votes/	Invalid votes/
percentage	percentage	percentage	percentage
9,139,616,267	1,848,905	814,424,887	0
91.80%	0.01%	8.18%	0.00%

Motion was passed as proposed through vote.

Resolution: Approved as proposed.

5.Matters for Discussion and Election

(There were a total of five discussions including one election. After discussing the motions one-by- one, Discussions #1-#3, #4, and #5 were voted and counted aggregately in one voting session, and outcomes of the vote and election were announced separately; the Chairman designated Mr. Chih- Yuan Chang (shareholder No. 1131281) and Mr. Chien-Chung Yen (shareholder No. 1131370) to serve as ballot examiners, whereas employees of the stock transfer agent - Yuanta Securities served as the ballot counters)

Proposal 1：The Proposal for Issuing New Shares through Capitalization of 2023 Earnings. (Proposed by the Board of Directors)

Explanation:

1. To raise capital adequacy ratio and strengthen financial structure, the Company, in accordance with Article 240 of the Company Act, proposes to appropriate NT$4,320,401,440 from 2023 distributable earnings for issuance of new 432,040,144 shares, with par value of NT$10 per share.
2. The Company's authorized capital is NT$220,000,000,000, and paid-in capital is NT$144,013,381,380. After capitalization of retained earnings of NT$4,320,401,440, the Company's paid-in capital will be NT$148,333,782,820.
3. In order to execute this proposal, the annual general shareholders' meeting is proposed to authorize the following:
4. 1. After this proposal is approved by the competent authority, the Board is authorized to set the ex-right date. 30 free shares will be distributed per

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one thousand shares based on the shareholding percentage recorded in the shareholders register on the ex-right date. If the stock dividends include any fractional shares which are less than one full share, the shareholders may go to the Company's stock agent to form one full share by pooling together of their fractional shares within 5 days after the ex-right date, otherwise the distribution will be made in the form of cash in a dollar amount. The Chairman is authorized to contact specific persons to subscribe remainder fractional shares at par value.

1. 1. If the number of the outstanding shares is changed due to share buyback, transfer, conversion, cancellation of treasury shares or other circumstances that affect dividend payout ratio, the Board is authorized to deal with relevant changes.
   2. If this proposal requires adjustment due to changes in regulations, amendments approved by the competent authority, or amendments from changes in objective circumstances, the Board is authorized to make the necessary adjustments.
2. Rights and obligations of the newly issued shares are the same as the existing shares.
3. This proposal has been approved by the 39th meeting of the 8th term of Board of Directors held on April 23, 2024.

Summary of meeting proceeding and method of resolution:

The emcee read out the purpose of the motion and made relevant explanations, and no shareholder requested to speak. The Chairman then made the decision to vote motions/election #1-#3 in aggregate after the motions have been discussed individually.

Outcome of vote:

The total number of voting rights represented by attending shareholders (including electronic votes) for this motion was 9,955,940,540：

Approval votes/	Disapproval votes/	Abstention	Invalid votes/
percentage	percentage	votes/ percentage	percentage
9,122,429,324	2,086,241	831,424,975	0
91.62%	0.02%	8.35%	0.00%

Motion was passed as proposed through vote.

Resolution: Approved as proposed.

Proposal 2：Amendment to the Company's Articles of Incorporation. (Proposed by the

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Board of Directors)

Explanation:

1. The company's Articles of Incorporation were established on December 19, 2001, and have been revised 15 times during this period. The latest amendment was approved by the shareholders' regular meeting on June 16, 2023.
2. In order to conform to our operational needs, it is proposed to amend Article 22 of the Company's Articles of Incorporation regarding audit system. The main points of the amendments are as follows：
3. 1. In consideration of the fact that the audit units of other governmental financial holding companies do not have an official position as Deputy Chief Auditor, and that the board of directors of Mega Bank also approved the amendment of the organization rules in October, 2016, and canceled the position of Deputy Chief Auditor.
   2. Considering the consistency of the audit system across this financial holding group, the company hereby proposes to adopt the audit regime of Mega Bank, whereby one Chief Auditor is appointed as the head of the head quarter's audit function, the title and its corresponding grade description of Deputy Chief Auditor are concurrently abolished.
   3. Please refer to Attachment 7 for the comparison table and amended Articles of Incorporation.
   4. This proposal has been approved by the 39th meeting of the 8th term of Board of Directors held on April 23, 2024.

Summary of meeting proceeding and method of resolution:

The emcee read out the purpose of the motion and made relevant explanations, and no shareholder requested to speak. The Chairman then made the decision to vote motions/election #1-#3 in aggregate after the motions have been discussed individually.

Outcome of vote:

The total number of voting rights represented by attending shareholders (including electronic votes) for this motion was 9,955,940,540：

Approval votes/	Disapproval votes/	Abstention votes/	Invalid votes/
percentage	percentage	percentage	percentage
9,122,386,387	1,923,953	831,630,200	0
91.62%	0.01%	8.35%	0.00%

Motion was passed as proposed through vote.

Resolution: Approved as proposed.

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Proposal 3：Amendment to the Company's "Procedures for Acquisition or Disposal of Assets" (Proposed by the Board of Directors)

Explanation:

1. The company's "Procedures for Acquisition or Disposal of Assets" was made on June 6, 1992, and has been amended six times during the period. The latest amendment was adopted by the Annual Shareholders' Meeting on June 17, 2011.
2. In conjunction with the "Corporate Governance 3.0-Sustainable Development Roadmap" and to promote the reporting of related party transactions in non- business activities in the shareholders' meeting, the Taiwan Stock Exchange added Article 11 of the Sample Template for XXX Co., Ltd. Rules Governing Financial and Business Matters Between this Corporation and its Affiliated Enterprises, whereby related party transactions approved by the board of directors by resolutions shall be reported to the annual shareholders' meeting following the end of the year, and the compliance of such transactions shall be listed as part of the corporate governance evaluation indicators. As such, the Company amended the Articles of Procedures for Acquisition and Disposal of Assets.
3. Key points of the amendment are as follows:
4. 1. Article 13: Paragraph 2 is added, whereby for related party transactions listed in paragraph 1 of this article, the actual transaction status shall be reported to the latest shareholders' meeting after the end of the year.
   2. Article 33: This is a new article to add the revision (amendment) process of these Articles.
5. Please refer to Attachment 8 for the comparison table and amended Procedures for Acquisition or Disposal of Assets.
6. This proposal has been approved by the 39th meeting of the 8th term of Board of Directors held on April 23, 2024.

Summary of meeting proceeding and method of resolution:

The emcee read out the purpose of the motion and made relevant explanations, and no shareholder requested to speak. Considering that motions/election #1-#3 had been thoroughly discussed, the Chairman made the decision to vote on motions/election #1-#3.

Outcome of vote:

The total number of voting rights represented by attending shareholders (including electronic votes) for this motion was 9,955,940,540：

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Approval votes/	Disapproval votes/	Abstention votes/	Invalid votes/
percentage	percentage	percentage	percentage
9,122,434,501	1,935,456	831,570,583	0
91.62%	0.01%	8.35%	0.00%

Motion was passed as proposed through vote.

Resolution: Approved as proposed.

Proposal 4：The Election of the 9th Term Board of Directors. (Proposed by the Board of Directors)

Explanation:

1. The tenure of the Company's 8th term Board of Directors will expire on July 19, 2024. According to The Company Act, the Company proposes to elect board members at this Annual Meeting of Shareholders.
2. According to Article 19 of the Company's Articles of Incorporation, the Company shall have 15 to 21 directors, of which the number of independent directors shall not be less than three and shall not be less than 1/5 of the board seats. Directors shall be elected by means of the candidate nomination system.
3. As approved by the board meeting, the Company will elect 15 directors (including 5 independent directors) for the 9th term Board of Directors. The tenure of the 9th term Board of Directors shall be 3 years, commencing from June 21, 2024 to June 20, 2027. The director candidates nominated have been reviewed and approved by the 39th meeting of the 8th term Board of Directors on April 23, 2024. For candidates' profiles, please refer to Attachment 9.

No.	Position	Name	Representative of Legal Entity
1		Chung-Dar Lei	Ministry of Finance, R.O.C.
2		Yu-Mei Hsiao	Ministry of Finance, R.O.C.
3		Po-Cheng Chen	Ministry of Finance, R.O.C.
4		Pei-Chun Chen	Ministry of Finance, R.O.C.
5	Director	Yih-Jiuan Wu	Ministry of Finance, R.O.C.
6		Ing-Ren Lee	Ministry of Finance, R.O.C.
7		Keh-Her Shih	National Development Fund,
	Executive Yuan, R.O.C.
8		Yi-Hong Deng	National Development Fund,
	Executive Yuan, R.O.C.

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