KEY POINTS OF RULES GOVERNING THE TDR ISSUER'S REPURCHASE OF TAIWAN DEPOSITARY RECEIPTS

03/01/2011

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Since the market price of some Taiwan Depositary Receipts ("TDRs") dropped and stayed below their listing prices for quite a while, and in response to TDR issuers' appeal, the Taiwan Stock Exchange Corporation ("TWSE") now allows TDR issuers to repurchase their outstanding TDRs after promulgating the Taiwan Stock Exchange Corporation Rules Governing the Secondary Listed Company's Repurchase of TDRs (the "Purchase Rules") on 21 December 2010. The Purchase Rules took effect immediately and are summarized below:
l	The TDR issuer's repurchase of its own TDRs should be approved by its board resolution and reported to its shareholders' meeting.
	The TDR issuer's repurchase of its own TDRs should be approved by a majority of the directors at a meeting attended by two-thirds or more of the total number of the directors ("Resolution Date"). The board resolution in connection with TDR repurchase, status of execution of repurchase as well as situations where the TDR issuer fails to repurchase its own TDRs for any reasons should be reported at the most recent shareholders' meeting.
l	Limitations on Repurchase Volume of TDRs
	1.	The aggregate volume of TDRs can be purchased by TDR issuer in a repurchase should not exceed 10% of total units of issued TDRs.
	2.	The TDR repurchase volume per day by a TDR issuer during the repurchase period should not exceed one third of the total units scheduled for repurchase. The TDR issuer should not provide price quotes before regular trading hours begin, and should appoint not more than two securities brokers to execute the repurchase. The repurchase volume of TDRs will not be subject to the above limitation if the repurchase volume of TDRs is not more than 200,000 units per day.
l	Restriction on Repurchase Purpose of TDRs
	All of the shares underlying the repurchased TDRs should be withdrawn from the TDR facility, and be cancelled, within 6 months after repurchase in accordance with the laws and regulations of the country of the registration of the TDR issuer.
l	Restriction on Disposal of TDRs by TDR Issuer's Insiders and Related Parties during the Repurchase Period
	During the period when the TDR Issuer repurchases its own TDRs on the market, TDR Issuer's insiders and related parties are prohibited from disposing of the TDRs they hold.
l	Method and Period for Repurchase of TDRs
	1.	A TDR issuer should execute the repurchase of its own TDRs during trading hours via TWSE's automated computer trading system, and should not execute the repurchase by means of block trading, oddlot trading, tender offer, auction, or after-market fixed-price trading.
	2.	A TDR issuer should complete the repurchase of its own TDRs within 2 months starting from the Disclosure Date (defined as below). If execution of the repurchase has not been completed within the aforesaid 2-month period and execution of another repurchase is necessary, another repurchase proposal should be submitted to the board meeting for approval.
l	Information Disclosure
	1.	A TDR issuer should report the following items via the Market Post Observation System ("Disclosure Date") within 2 days starting from the Resolution Date, and the TDR issuer is prohibited from executing the repurchase before making such report:
		(1)	Resolution Date and manner of resolution;
		(2)	Purpose of repurchase (withdrawal and cancellation);
		(3)	Maximum total monetary repurchase amount;
		(4)	Scheduled repurchase period and the volume of TDRs to be repurchased;
		(5)	Price range for the repurchase;
		(6)	Method for the repurchase;
		(7)	Ratio of scheduled repurchase units to total units of issued TDRs;
		(8)	Any repurchase of TDRs within 3 years before Resolution Date;
		(9)	Scheduled or actual date for cancellation of underlying shares; and
		(10)	Other items prescribed by the TWSE.
	2.	Whenever the cumulative volume of repurchased TDRs reaches 2% of total units of issued TDRs, or when the outstanding TDRs total less than 12 million units, the TDR issuer should, within 2 days upon occurrence of one of the above facts, make an announcement of the date, volume, and price of repurchase via the Market Post Observation System.
	3.	A TDR issuer should report the status of execution of repurchase (a) upon expiration of the 2-month period starting from the Disclosure Date; or (b) within 5 days upon completion of repurchase.