[Board Member Diversity Policy and Achievements]

1. Diversity Policy for Board Members

Solid State System Co., Ltd. has established a comprehensive "Director Election Procedure" to guide the selection and appointment of its board members. This procedure, especially outlined in Article 2, emphasizes that directors must possess a broad range of essential knowledge, skills, and competencies required for their roles. To achieve the ideal objectives of corporate governance, the board as a whole should collectively exhibit the following capabilities:

2.Implementation of Board Member Diversity Policy

Tenure of Independent Directors

 Note: ○ Indicates Partial Ability

Board Succession Plan and Operations

(1) The company's "Articles of Incorporation" stipulate a comprehensive system of nominating candidates for directors. The "Corporate Governance Practices" and "Director Election Procedures" specify that the composition of the board of directors should consider diversification, tailored to the company's operations, business type, and developmental needs. This includes standards such as fundamental values, professional knowledge, and skills.

(2) The company continues to implement a director succession plan, establishing a database of potential directors based on the following criteria:

1. Integrity, responsibility, innovation, and decision-making skills that align with the company's core values and contribute to effective management.Industry experience relevant to the company's business operations.

2. Anticipated contributions to maintaining an effective, collaborative, diversified board that meets the company's needs. The overall board expertise should encompass corporate strategy, accounting and taxation, finance, law, administration, and production management. The selection process for director candidates must comply with qualification reviews and relevant regulations to ensure effective identification and selection of suitable new directors when board vacancies arise or expansion is planned.

(3)The company also defines the "Board Performance Evaluation Methods" to assess various aspects such as control of company goals and tasks, understanding of responsibilities, participation in operations, management of internal relationships and communication, professional skills and development, internal controls, and specific opinions expressed. This evaluation aims to confirm the effective functioning of the board and assess director performance, serving as a reference for future director selections.

Succession Plan and Operation for Key Management

Our company's succession plan for key management focuses on cultivating a talent pool, identifying high-potential employees, and establishing comprehensive education and training systems and promotion pathways. We provide continuous improvement and development opportunities to meet future demands for succession in key management roles.

The training model for successors in our company's key management spans three main modules: managerial skills, professional capabilities, and personal development plans. Through specialized training, participants integrate and apply their skills to cultivate decision-making abilities. Training records are logged in individual training logs by the Human Resources Department to track employee development progress.

Key management positions in our company are held by executives at the department head level and above. Management layers are structured according to organizational hierarchy, with each department having senior and mid-level managers. We timely groom mid-level managers to serve as substitutes for senior executives. Additionally, an annual employee performance review assesses performance through daily observations and evaluations, identifying areas for improvement and aligning personal expectations with succession planning considerations.

Performance Evaluation of Board of Directors and Functional Committees

The company conducts annual self-assessments of the Board of Directors and functional committees based on the internally established "Board Performance Evaluation Method." The evaluation scope includes the overall operation of the Board of Directors and functional committees, as well as self-assessments by all directors. The evaluation for the year 2023 has been submitted to the Board of Directors as of February 22, 2024.

1.The Board of Directors fulfills its management responsibilities according to corporate governance norms, engages in thorough discussions and communications, and makes decisions in the best interest of the company. All directors, including independent directors, have positively evaluated the efficiency and effectiveness of the Board's operations.

2.The Audit Committee operates effectively under its authority and corporate governance norms. All independent directors have given positive evaluations regarding the efficiency and effectiveness of the Audit Committee's operations.

3.Members of the Compensation Committee have generally given positive evaluations of its efficiency and effectiveness. They recognize the committee's proper functioning and compliance with relevant regulations.

Evaluation Period: January 1, 2023 to December 31, 2023

Implementation of Integrity Management in 2024

1. To engage in business activities based on the principles of fairness, honesty, trustworthiness, and transparency. In order to implement the integrity management policy and actively prevent dishonest behaviors, the company has formulated the "Integrity Management Code".
2. The company has "work rules", in addition to clearly stipulating that all employees must be honest in their words and deeds, and must not accept bribes to prevent employees from harming the company's rights and interests due to their personal interests, there are also  channels for communicating opinions with colleagues and procedures for handling complaints.
3. The company’s "Rules of Procedures of the Board of Directors" has a system for avoiding the interests of directors. If the proposals listed by the board of directors have an interest in the board of directors and the legal person they represent, which may harm the interests of the company, they may state their opinions and answer inquiries. Must not participate in discussion and voting, and should be avoided during discussion and voting, and may not act for other directors to exercise their voting rights.
4. The company's business units and purchasing units respectively conduct credit investigations on customers and manage the service quality of suppliers in accordance with internal operating procedures.
5. The company has established an effective accounting system and internal control system to ensure the implementation of integrity management; the company’s financial statements have been entrusted with an accountant to check and issue a visa report; the internal control system has internal auditors to regularly check its compliance and follow Report quarterly to the audit committee and the board of directors.

6. The company’s daily business pays attention to the implementation of the principle of integrity by all employees, and plans the "Information Environment and Information Security Advocacy" course in the company’s newcomer training courses, emphasizing that tangible information equipment and intangible information assets should be properly handled Keep and keep confidential to avoid leaking company secrets. It also implements "Inside Trading Promotion" every year, and it is not allowed to use undisclosed information to engage in insider trading, nor to disclose it to others. 2024.12.27 Announcing the promotion of "inside trading" to all employees.  In addition, for the first time every year, the director regularly Promote insider trading and report to the board of directors the execution of the internal material information processing procedures. 

Whistleblowing Channels and Process:

  Stakeholders can report or appeal through the  telephone or email of each contact window in the "Stakeholder Area" on the company's website. After the company receives an appeal case, it shall investigate the facts and report it to the company's dedicated unit, communicate with the parties as soon as possible, and inform the handling results or handling methods and progress. If the complainant is dissatisfied with the result of the settlement, he may file a complaint again when receiving the relevant reply from the company, and submit a new reason or new evidence to apply for a review. The parties to the complaint and the handling personnel shall keep the investigation process and related information confidential, and shall not release it without authorization, and the company shall properly store the relevant information and protect the complainant from any retaliation or other unfavorable  treatment. The parties involved in the outflow of the case that cannot be kept confidential will be discussed and dealt with in accordance with relevant regulations.

  Overall, the company has formulated the "Code of Integrity Management" and publicly  disclosed it on the company website and public information observatory. Through internal education, training and publicity, internal  and external personnel can clearly understand the company’s integrity management. related policy. Therefore, under the provisions of  the "Code of Integrity Management" that clearly regulates and prohibits various business activities, the company did not directly or  indirectly provide, receive, promise or request any improper benefits, or engage in other violations of integrity, illegality or violations the act of fiduciary duty in 2024.

Risk Management Policy

  The company's risk management policy was approved by the Board of Directors in 2020. Through systematic evaluation and identification of risks, strategies are formulated to reduce, transfer, or avoid risks. The goal is to strengthen and improve the internal system structure and increase the resilience of the company's sustainable operations.

Scope of Risk Management

   The company's risk management operations cover both external risks such as political and economic risks, climate/environmental risks, regulatory compliance risks, and market risks, as well as internal strategic risks such as legal risks, credit risks, investment risks, information security risks, and operational risks. Each functional department is responsible for monitoring risks within their business. When exposure exceeds its risk limit, the relevant department must propose countermeasures and report the risks and solutions to senior management. Risk management procedures and their results should be thoroughly documented and reported to the Board of Directors.

Risk Management Implementation

Risk management is implemented according to a three-tier structure:

Execution of Risk Management

Department heads and unit managers should conduct risk assessments and controls in their daily management operations, emphasizing comprehensive risk control for all employees and implementing layered prevention measures to effectively manage risks.

Finance Department: Based on laws, policies, and market changes, the department establishes various strategies, procedures, and indicators. It regularly analyzes and evaluates changes in relevant risks and takes appropriate countermeasures to reduce the overall potential risks. The company’s financial management regularly discusses the accuracy and timeliness of financial information with financial accounting personnel. The monthly consolidated revenue and financial information are announced, and quarterly reports on derivative financial instrument transactions are presented to the Board of Directors.

Audit Office: The Audit Office formulates an annual audit plan based on risk assessments and executes it accordingly. It reports audit results to the Audit Committee and Board of Directors quarterly and follows up on improvements.

For detailed content regarding the risk management methods, please refer to the company’s website under the corporate governance rules section titled "Risk Management Methods."

Strict Prohibition of Insider Trading or Profit from Market Information Asymmetry by Insiders

The company's directors, managers, and employees (insiders) are prohibited from engaging in insider trading or profiting from market information asymmetry. The company values shareholders' rights to know and complies with regulations regarding information disclosure. Financial, business, internal shareholding, and corporate governance information is regularly and promptly made available to shareholders through the Market Observation Post System or the company's website.  To protect shareholders' rights and ensure equal treatment, the company has established the "Internal Major Information Processing Procedures" as per Article 9 of the "Corporate Governance Best-Practice Principles" to ensure that the directors, managers, and employees of the company perform their duties with care and integrity, also required to sign confidentiality agreements.

Directors, managers, and employees who are aware of the company’s internal major information shall not disclose it to others and shall not inquire about or collect non-disclose internal major information of company that is not related to their personal duties from the person who knows it, and also shall not disclose it that is not result from executing business activities learned undisclosed internal major information of company

The company also prohibits insiders from trading securities based on non-public market information. The company will amend the " Internal major information processing operating procedures" in accordance with the "Corporate Governance Best-Practice Principles." It will explicitly state that once internal personnel are aware of the company's financial reports or related performance details, including (but not limited to) directors, they are prohibited from trading the company's listed stock or other securities with equity characteristics at securities firms during the closed period. This period is defined as the thirty days prior to the annual financial report announcement and the fifteen days prior to each quarterly financial report announcement.  Furthermore, if the aforementioned information significantly impacts the price of the securities issued by the company, internal personnel are still prohibited from violating the Securities and Exchange Act, Article 157-1, which governs the information cooling-off period. Specifically, after the information becomes clear, no trades can be made, either directly or through an intermediary, on the company's listed stock or securities with equity characteristics, within 18 hours before or after the information is publicly disclosed.

Implementation for Advocate Education of the Provision in 2024

The 10th Board of Directors related Education Courses

Insiders are not allowed to trade the execution of the issued securities of the Company held by them during the closed period of the financial reporting announcement

Article 10 of the Code of Practice on Corporate Governance for Listed and OTC Companies (Listed companies should pay attention to shareholders' right to know and guard against insider trading):
The stock trading control measures of the OTC company insiders from the date of learning of the company's financial reports or relevant results, including (but not limited to) directors are not allowed to trade their shares during the closed period of 30 days before the announcement of the annual financial report and 15 days before the announcement of the quarterly financial report.