Articles of Incorporation

In the event of any dispute or misunderstanding as to the interpretation of the language or terms of these Articles, the Chinese version shall prevail.


Chapter I General Provisions


Article 1


The Corporation shall be incorporated, as a company limited by shares, under the Company Law of the Republic of China, and its name shall be 晶碩光學股份有限公司 in the Chinese language, and PEGAVISION Corporation Limited in the English language.


Article 2

The scope of business of the Corporation shall be as follows:

  • CF01011 Medical Materials and Equipment Manufacturing
  • F108031 Wholesale of Drugs, Medical Goods
  • F208031 Retail sale of Medical Equipments
  • CE01030 Photographic and Optical Equipment Manufacturing
  • CE01010 Precision Instruments Manufacturing
  • F113030 Wholesale of Precision Instruments
  • F213040 Retail Sale of Precision Instruments
  • CC01040 Lighting Facilities Manufacturing
  • F113020 Wholesale of Household Appliance
  • F213010 Retail Sale of Household Appliance
  • F401010 International Trade
  • IG01010 Biotechnology Services
  • C802041 Drugs and Medicines Manufacturing
  • F108021 Wholesale of Drugs and Medicines
  • F208021 Retail Sale of Drugs and Medicines
  • JZ99060 Spectacles Shops
  • F110020 Wholesale of Spectacles
  • F210020 Retail Sale of Spectacles
  • F206020 Retail Sale of Articles for Daily Use
  • F106020 Wholesale of Articles for Daily Use
  • F208040 Retail Sale of Cosmetics
  • F108040 Wholesale of Cosmetics
  • F399990 Retail sale of Others
  • F203010 Retail sale of Food and Grocery
  • F102170 Wholesale of Food and Grocery
  • I401010 General Advertising Services
  • F399010 Convenience Stores
  • F301010 Department Stores
  • F301020 Supermarkets
  • I301010 Software Design Services
  • ZZ99999 All business items that are not prohibited or restricted by law, except those that are subject to special approval.

Article 3

The Corporation shall have its head office in Taoyuan City, Taiwan, Republic of China, and shall be free, upon approval of the Board of Directors, to set up branch units at various locations within and without the territory of the Republic of China when necessary.


Article 4

Public announcements of the Corporation shall be made in accordance with Article 28 of the Company Law of the Republic of China.


Chapter II Shares


Article 5

The total capital stock of the Corporation shall be in the amount of eight hundred million (800,000,000) New Taiwan Dollars, divided into eighty million (80,000,000) shares, at ten (10) New Taiwan Dollars each, and may be paid-up in installments. Any of the unissued share may be paid-up in installments by the resolutions of the Board of Directors and a total of four million (4,000,000) shares among the above total capital stock shall be reserved for issuing employee share options.


Article 6

The total amount of the Corporation’s reinvestment shall not be subject to the restriction of not more than forty percent (40%) of the Corporation’s paid-in capital as provided under Article 13 of the Company Law of the Republic of China.


Article 7

The share certificates of the Corporation shall be name-bearing, signed or sealed by at least three (3) Directors of the Corporation, and issued after the authentication of the bank which is competent to certify in accordance with laws. The Corporation may issue shares without printing share certificates, and shall appoint a centralized securities custody institution to make recordation of the issue of such shares.


Article 8

The name entering in the shareholders’ roster shall not be altered within sixty (60) days prior to the convening date of a regular shareholders’ meeting, or within thirty (30) days prior to the convening date of a special shareholders’ meeting, or within five (5) days prior to the target date fixed by the issuing Corporation for distribution of dividends, bonuses or other benefits.

Periods specified in the preceding Paragraph shall commence from the applicable convening date of a shareholders’ meeting or from the applicable target date, as the case may be.


Article 9

The share transaction or other relevant rights conducted by shareholders of the Corporation shall follow the “Guidelines for Stock Operations for Public Companies” unless specified otherwise by laws, rules and securities regulations of the Republic of China.


Article 10

The shareholders of the Corporation shall fill in the signature card, provide specimen of signature or chop, and keep them at the head office of the Corporation or the business office of its securities agent when opening the account. And the requirement shall also apply to the change of the above situation.


Chapter III Shareholders’ Meeting


Article 11

Shareholders’ meetings of the Corporation are of two types, namely regular meetings and special meetings. Regular meetings shall be convened within six (6) months after the close of each fiscal year. Special meetings shall be convened in accordance with relevant laws, rules and regulations of the Republic of China when necessary.
Written or electronic notices recording the meeting date, place and proposal(s) shall be sent to all shareholders at least thirty (30) days in advance, in case of regular meetings; and at least fifteen (15) days in advance, in case of special meetings. A public notice may be given to the shareholders holding less than one thousand (1,000) shares instead.


Article 12

The shareholders’ meeting shall be presided over by the Chairman of the Board of Directors when convened by the Board of Directors. In case the Chairman of the Board of Directors is on leave or absent or cannot exercise his/her/its power and authority for any cause, a representative shall be appointed in accordance with Article 208 of the Company Law of the Republic of China; where as for a shareholders meeting convened by any other person having the convening rights, he/she/it shall act as the chairman of that meeting provided, however, that if there are two or more persons having the convening right, the chairman of the meeting shall be elected from among themselves.


Article 13

If a shareholder is unable to attend the shareholders’ meeting for any reason, he/she/it may appoint a proxy to attend the shareholders’ meeting with respective signatures or personal seals in his/her/its behalf by executing a power of attorney printed by the Corporation stating therein the scope of power authorized to the proxy.


Article 14

Except in the circumstances set forth in the Company Law of the Republic of China where there is no voting right for a share, each share of the Corporation shall be entitled to one vote.
The voting power at a shareholders’ meeting shall be exercised in writing or by way of electronic transmission in accordance with relevant laws, rules and regulations of the Republic of China .
A shareholder who exercises his/her/its voting power at a shareholders meeting by way of electronic transmission as set forth in the preceding Paragraph shall be deemed to have attended the said shareholders’ meeting in person, but shall be deemed to have waived his/her/its voting power in respective of any extemporary motion and/or the amendment to the contents of the original proposal(s) at the said shareholders’ meeting.


Article 15

Except as provided in the Company Law of the Republic of China, shareholders’ meetings shall be held if attended by shareholders in person or by proxy representing more than one half of the total issued and outstanding capital stock of the Corporation, and the resolutions shall be adopted at the meeting with the concurrence of a majority of the votes held by shareholders present at the meeting.


Article 16

If the Corporation is limited by shares organized by a single juristic person shareholder, the functional duties and powers of the shareholders’ meeting of such Corporation shall be exercised by its Board of Directors, to which the provisions governing the shareholders’ meeting as set out in the Company Law of the Republic of China shall not apply.


Chapter IV Directors, Audit Committee and Managerial Personnel


Article 17

The Corporation shall have five (5) to nine (9) Directors, and the term of office shall be three (3) years. Directors shall be elected from among the nominees listed in the roster, adopting the candidate nomination system as specified in the Company Law of the Republic of China and all Directors shall be eligible for re-election.
During the term of office, the Corporation may purchase liability insurance for Directors to indemnify the potential liabilities, according to the relevant laws, rules and regulations of the Republic of China to be borne by Directors when performing their duties for the Corporation.
The Corporation may appoint Independent Directors, not less than three (3) in number and not less than one-fifth (1/5) of the total number of Directors from the above roster. Regulations governing the professional qualifications, restrictions on shareholdings and concurrent positions held, method of nomination and other matters for compliance with respect to Independent Directors shall be prescribed by the Competent Authority.


Article 17-1

In compliance with Article 14-4 of the Securities and Exchange Law of the Republic of China, the Corporation shall establish an Audit Committee, which shall consist of all Independent Directors.


Article 18

The Board of Directors is composed of Directors responsible for the duties as follows:

  • Prepare the Business Report;
  • Submit Proposal Concerning the Distribution of Earnings or Covering of Losses;
  • Submit Capital Increase or Deduction Plan;
  • Enact Important Articles of Incorporation of the Corporation;
  • Appoint and Discharge the Managerial Personnel for the Corporation;
  • Set up and Dissolve the Branches;
  • Prepare the Budget and the Balanced Budget ;
  • Perform Other Duties Authorized by the Company Law of the Republic of China or the Resolutions of the Shareholders’ Meetings.

Article 19

The Directors shall elect from among themselves a Chairman of the Board of Directors, and may elect a Vice Chairman of the Board of Directors in view of business needs, by a majority in a meeting attended by two-thirds (2/3) of the Directors. The Chairman of the Board of Directors shall have the authority to represent the Corporation.


Article 20

A meeting of the Board of Directors shall, unless otherwise provided for in the Company Law of the Republic of China, be convened by the Chairman of the Board of Directors. A resolution of the Board of Directors shall, unless otherwise provided for in the Company Law of the Republic of China be adopted by a majority in a meeting attended by a majority of the Directors.


Article 21

The Chairman of the Board of Directors shall preside over all the meetings of the Board of Directors. In case the Chairman of the Board of Directors is on leave or absent or cannot exercise his/her/its power and authority for any cause, a representative shall be appointed in accordance with Article 208 of the Company Law of the Republic of China. Each Director shall attend the meeting of the Board of Directors in person except he/she/it is represented by the other Director for any cause. In case a meeting of the Board of Directors is proceeded via video conference, any Director attending in the meeting via video conference shall be deemed attending the meeting in person. In case a Director appoints the other Director to attend a meeting of the Board of Directors in his/her/its behalf, he/she/it shall in each time, issue a written proxy and state therein the scope of the authority with reference to the subjects to be discussed at the meeting.
A Director may accept the appointment to act as the proxy referred to in the preceding Paragraph of one (1) the other director only.


Article 22

In calling a meeting of the Board of Directors, written, faxed, or e-mailed notices shall be sent to all Directors, in accordance with Article 204 of the Company Law of the Republic of China, and may be convened at any time in case of urgent circumstances.


Article 23

Exercise of the powers and matters related thereto by the Audit Committee and its members shall be in accordance with the Securities and Exchange Law and other relevant laws, rules and regulations of the Republic of China.


Article 24

The Board of Directors is authorized to determine the remuneration for the Directors, taking into account the extent and value of the services provided for the management of the Corporation and the standards of the industry with the R.O.C. and overseas. Besides the remuneration for the Directors in accordance with Article 27 of these Articles of Incorporation, Directors may also be paid monthly the salary by the general standard for managerial personnel if he/she/it holds any position in the Corporation.
The Corporation may have one or more managerial personnel. The appointment, discharge and remuneration of the managerial personnel shall be handled in accordance with Article 29 of the Company Law of the Republic of China.


Chapter V Accounting


Article 25

The fiscal year for the Corporation shall be from January 1 of each year to December 31 of the same year. After the close of each fiscal year, the Corporation shall close its books.


Article 26

After the close of each fiscal year, the following reports shall be approved by the Audit Committee, then resolved by the Board of Directors, and submitted to the regular shareholders’ meeting for acceptance in accordance with Article 228 of the Company Law of the Republic of China:

  • Business Report;
  • Financial Statements;
  • Proposal Concerning the Distribution of Earnings or Covering of Losses.

Article 27

The Corporation shall set aside its profits of the period for which the Corporation distributes the earnings as compensation to its employees and Directors; provided, however, that the Corporation shall have reserved a sufficient amount to offset its Accumulated Losses as follows:

  • Not less than ten (10) percent to the employees, which may be distributed by way of cash or share. The Corporation may distribute the earnings to its employees of an affiliated company meeting the conditions set by the Board of Directors.
  • Not more than one (1) percent to the Directors.

Article 27-1

When allocating the earnings after the close of each fiscal year , the Corporation shall first estimate and reserve the taxes to be paid, offset its losses, set aside a Legal Capital Reserve at ten (10) percent of the remaining earnings provided that the amount of Accumulated Legal Capital Reserve has not reached the amount of the paid-in Capital of the Corporation, then set aside a Special Capital Reserve in accordance with relevant laws, rules or regulations or as requested by the Competent Authority. The Proposal Concerning the Distribution of Earnings of the remaining amount and the Accumulated Retained Earnings is prepared by the Board of Directors and submitted to the shareholders’ meeting for the decision of distribution or retaining.


Article 28

The distribution of dividends of the Corporation shall coordinate with earnings of the year based on the principle of stabilization. Due to the rapid changes in the industry, the Corporation shall adopt a Dividend Balancing Policy to distribute the cash dividend at the rate not less than ten (10) percent of the total distribution under Article 27-1 based on a plan of future capital needs and long term operation.


Article 29

The distribution of dividends to the shareholders shall be limited to the shareholders recorded in the shareholders roster five (5) days before the target date fixed by the issuing Corporation for distribution of dividends, bonuses or other benefits.


Chapter VI Supplementary Provisions


Article 30

The internal organization of the Corporation and the detailed procedures of business operation shall be determined by the Board of Directors.


Article 31

The Corporation may, depending on business needs, provide endorsement and guarantee and act as a guarantor.


Article 32

In regard to all matters not provided for in these Articles of Incorporation, the Company Law, relevant rules and regulations of the Republic of China shall govern.


Article 33

These Articles of Incorporation are agreed to and signed on August 12, 2009 by all the promoters of the Corporation.

The first Amendment was made on April 29, 2014.

The second Amendment was made on June 16, 2015.

The third Amendment was made on June 14, 2016.

The fourth Amendment was made on June 14, 2018.


PEGAVISION CORPORATION LIMITED
Chairman: Tung, Tzu-Hsien

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