minutes of 2016 annual shareholders’ meeting · - 1 - minutes of 2016 annual shareholders’...

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MINUTES OF 2016 ANNUAL SHAREHOLDERS’ MEETING

OF ACER INCORPORATED

(Translation)

The translation is intended for reference only and nothing else. The Chinese text of

the Minutes of 2016 Annual Shareholders’ Meeting shall govern any and all

matters related to the interpretation of the subject matter stated herein.

Time and Date of Meeting: 9:00 a.m., June 24, 2016

Place of Meeting: 4F., No. 99, Sec. 1, Xintai 5th Rd. ,Xizhi Dist., New Taipei City

(Place of the Meeting: Farglory International Convention Center)

Total outstanding shares of ACER (excluding the shares without voting right as

stipulated in Article 179 of the Company Law): 3,063,633,833 shares

Total shares represented by shareholders present in person or proxy: 1,601,701,674

shares

Percentage of shares held by shareholders present in person or proxy: 52.28%

The attendance list of the directors:

George Huang, Jason C.S. Chen, Philip Peng and F. C. Tseng

Chairman: George Huang

Recorder: Nancy Hu

The aggregate shareholding of the shareholders present in person or proxy constituted a

quorum. The Chairman called the meeting to order.

Chairman’s Address : (Omitted)

1. Proposed Resolutions (A) Item 1 Proposal: To Approve Amendments to the Company’s Articles of Incorporation. (Proposed by

the Board of Directors) Explanatory Notes:

(1) Due to the amendment of Article 235, 235-1 and 240 of Company Act made on May 20, 2015, instead of calculating by “profit after taxes” and distributed from retained earnings, a company shall, after deducting the cumulative losses (if any), calculate employee and Director remuneration from “profit before taxes” by

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applying the ratio prescribed in the Articles of Incorporation. Therefore, it is now proposed to modify employee and Director’s remuneration ratio by amending Article 16-1, 20~ 22 of Article of Incorporation. Please refer to Attachment 1, pages 13 to 14, for the comparison table.

(2) Please discuss.

Voting Results: Shares present at the time of voting: 1,599,670,108 (votes casted

electronically: 540,172,623 votes)

Voting Results* % of the total represented

share present

Votes in favor: 1,445,130,369 votes

(387,229,517 votes) 90.34%

Votes against : 263,553 votes

(259,552 votes) 0.02%

Votes invalid or abstained: 154,276,186 votes

(152,683,554 votes) 9.64%

*including votes casted electronically (number in brackets)

RESOLVED, that the above proposal be and hereby was approved as proposed.

2. Report Items (1) To Report the Business of 2015

Explanatory Notes: Please refer to Attachment 2, page 15. (2) To Report the Execution of Sound Business Plan

Explanatory Notes: I. In accordance with the Certificated No. 1030039103 issued by Financial

Supervisory Commission, R.O.C. (Taiwan) on October 21, 2014, hereby to report the execution status of sound business plan for cash injection of issuing a total number of 300,000 thousand shares. Please refer to the Attachment 3, page16.

II. The application and purpose of the utilization plan aforesaid had been achieved as of December 31, 2015. .

(3) Audit Committee’s Review Report

Explanatory Notes: Please refer to Attachment 4, page17.

(4) To Report the Execution of 2015 Employees' Compensation and Board Directors' Remuneration Explanatory Notes: Please refer to Attachment 5, page 18.

Speech from shareholders: shareholder registered number 0519823 and 0776988 had

questions about the schedule of company organizational change and the deadline of

announcement for monthly revenue, the questions were responded by the Chairman and the

assigned.

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3.Proposed Resolutions (B) Item 2 Proposal: To Accept 2015 Financial Statements and Business Report. (Proposed by the Board

of Directors) Explanatory Notes:

(1) Acer’s 2015 Financial Statements, including the Balance Sheets, Statements of Comprehensive Income, Statements of Changes in Equity and Statements of Cash Flow have been audited by independent auditors, Tzu-Chieh Tang and Wei-Ming Shih of KPMG.

(2) The 2015 Business Report and the aforementioned financial statements are attached as Attachment 2, page 15 and Attachment 6, pages 19 to 32, which have been approved by the Audit Committee and resolved by the Board of Directors with resolution and are hereby submitted for acceptance.

(3) Please discuss.




share present


(376,520,326 votes) 89.56%


(264,867 votes) 0.02%


(163,387,430 votes) 10.42%



Item 3 Proposal: To Approve the Proposal for Distribution of 2015 Retained Earnings. (Proposed by

the Board of Directors) Explanatory Notes:

(1) The beginning balance of the un-appropriated retained earnings of the Company is

NT$0 in 2015. After plus the net income after tax for 2015, NT$603,680,268 and

deduct retained earnings of NT$83,445,509 which is caused by the retirement of

treasury stock and the restatement of IFRS version update, the total accumulative

retained earnings available for appropriation is NT$520,234,759.

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(2) In compliance with the Company Law, to appropriate the annual retained earnings,

it is required to set aside NT$52,023,476 as legal reserve and NT$468,211,283 as

special reserve, the ending balance of the un-appropriated retained earnings is

NT$0.

(3) It is proposed not to pay dividends.

(4) Please discuss

Acer Incorporated

2015 Statement of Distribution of Retained Earnings

Unit：NT$

Beginning Balance of Un-appropriated Retained Earnings 0

Plus：2015 Net Income after Tax 603,680,268

Deduct: retained earnings caused by the retirement of treasury stock and the restatement of IFRS version update (83,445,509)

Accumulative Retained Earnings Available for Appropriation in 2015 520,234,759

Items of appropriation:

Deduct: Legal Reserve (52,023,476)

Deduct: Special Reserve (468,211,283)

Ending Balance of Un-appropriated Retained Earnings 0




share present


(387,116,806 votes) 90.22%


(364,300 votes) 0.03%


(152,691,517 votes) 9.75%



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Item 4 Proposal: To Approve the Proposal of Cash Distribution from the Capital Surplus. (Proposed

by the Board of Directors) Explanatory Notes:

(1) In accordance with Article 241 of the Company Act, it is proposed a cash distribution of 1,540,501,414 from the capital surplus derived from any common stock issued by the Company. The cash will be distributed to the shareholders whose names and respective shares are in the shareholders’ register on the record date for ex-dividend, at a ratio of NT$ 0.5 per share (Rounded down to full NT dollar and the fractional amounts will be aggregately recognized as the Company’s other income).

(2) Should the cash distribution be adjusted due to the amendment of laws or regulations, a request by competent authorities, or any change of the numbers of outstanding share, subject to the approved distribution, it is proposed the General Shareholders’ Meeting to authorize the Board of Directors with full power to adjust the distribution ratio.

(3) Subject to this cash distribution approved by the General Shareholders’ Meeting, it

is proposed the General Shareholders’ Meeting to authorize the Board of Directors with full power to determine the record date for the cash distribution from capital surplus.

(4) Please discuss.




share present


(387,185,414 votes) 90.23%


(332,684 votes) 0.02%


(152,654,525 votes) 9.75%


RESOLVED, that the above proposal be and hereby was approved as proposed. Item 5 Proposal: To Accept the Modification of the 2014 Utilization Plan of Funds Obtained Through

the Sale of New Stocks. (Proposed by the Board of Directors) Explanatory Notes:

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(1) This 2014 capital increase had been approved by the Financial Supervisory Commission on October 21, 2014 (#1030039103). The original version of the utilization plan of funds and the estimated effects are shown in Appendix 2, page 39.

(2) The original version of the utilization plan is as follows:

In thousands of New Taiwan Dollars

Purpose Estimated Utilizatio

n Date

Required Amount

Utilization plan

Y2015

Quarter 1 Quarter 2 Quarter 3 Quarter 4

Pay off bank loan

Q4, 2014 3,600,000 -- 1,800,000 -- 1,800,000

Redemption repayment

from the put option

executed by the ECB holders

Q3, 2015 3,515,899 -- -- 3,515,899 --

Summary － 7,115,899 -- 1,800,000 3,515,899 1,800,000

(3) Reasons of modifications of the utilization plan:

Redemption repayment from the put option executed by the ECB holders in the original plan was implemented in Q2 2015. Due to the costs is lower than the redemption repayment from the put option, Acer had been continually purchasing back and cancelling the convertible bond from the market. The current amount of the convertible bond has been lessened from USD103,800,000 to USD13, 400,000. Therefore, as of the expiration date of the options (July 27, 2015), only NT $ 459,815,000 of the convertible bonds had been sold back by the bondholders, and NT $ 1,340,185,000 of the increased capital remain unspent. For the effective use of the funds, it is proposed to change the purpose of the funds from “redemption repayment from the put option executed by the ECB holders” to “strengthen operating capital”, which will be able to effectively save interest of short-term bank financing expenditure and reduce financial burden.

(4) Impact on shareholders’ interest: As a response to changes in the financial planning, ACER reserves to maintain a stable banking facilities and working capital. The proposed modification will increase flexibility and scheduling the use of funds and to improve the financial structure in the long run, there is no significant negative impact on shareholders’ interest.

(5) For the proposed utilization plan of funds and the estimated effects, please see

Appendix 3, page 40.

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(6) Other information regarding the modifications of the plan, please see Appendix 4, pages 41 to 42.

(7) For the evaluation by the lead securities underwriter, please see Appendix 5,

pages 43 to 44.

(8) The modification not only shall be announced to the public in accordance with relevant regulations, but also has been approved by the Board of Directors on August 6, 2015.

(9) Please discuss.




share present


(386,839,445 votes) 90.21%


(526,863 votes) 0.03%


(152,806,315 votes) 9.76%



4.Extemporary Motion

Speech from shareholders: shareholder registered number 0776988, 0851799, 0866224 and

0038933 had questions and comments about the directions of company and business

development, board directors' and managements’ remuneration and financial statement, the

questions were responded by the Chairman and the assigned.

5.Meeting Adjourned : 10:40 a.m. Note: This document is extracted from the meeting; the details are subject to the audio and video recording.

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