Phison Electronics : Announcement that the resolution of the Phison board of directors for proposes to exchange its held UD shares for the acquisition of Apacer newly issued shares

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Provided by: Phison Electronics Corp.
SEQ_NO	1	Date of announcement	2022/06/02	Time of announcement	20:19:16
Subject	Announcement that the resolution of the Phison board of directors for proposes to exchange its held UD shares for the acquisition of Apacer newly issued shares
Date of events	2022/06/02	To which item it meets	paragraph 11
Statement	1.Subject company:UD Info Corporation ("UD") 2.Counterparty:Apacer Technology Inc. ("Apacer") 3.If the counterparty is the related party?:Yes 4.Relationship between the counterparty and the Company (investee company in which the Company has re-invested and has shareholding of XX%), and the reason for choosing the related party as trading counterpart, and whether it will affect shareholders' equity:UD is the inveetee corporation of the Company and the Company holds approximately 17.4% of all the issued and outstanding shares of common stock of UD.The Company is one of Apacer's shareholders (shareholding percentage is approximately 9.87%) and holds Apacer's one board seat, therefore, Apacer is a related party of the Company.In order for Apacer and UD to intergrate both companyies' resources, to bring both companies' product development advantage into full play, to expand the niche market overseas, to have a deeper focus on its current market, and to enhance both companies' business performance and market competitiveness, certain shareholders of UD and Apacer desire to enter into share exchange transaction pursuant to Article 156-3 of Company Act. Apacer will issue 9,863,920 shares of common stock, as the consideration for this share exchange transaction, in exchange for 4,931,960 issued and outstanding shares of common stock of UD held by UD's shareholders (approximately equal to 68.54% of the issued and outstanding shares of common stock of UD). The Company proposes to engage in the share exchange transaction to exchange its held 1,252,290 issued and outstanding shares of common stock of UD (shareholding percentage: approximately 17.4%) for 2,504,580 newly- issued shares of common stock of Apacer. By means of this share exchange transaction, the Company will continuously maintain good long term business relationship with Apacer group. And, by integrating the shareholding structure through the share exchange transaction, the Company can improve its investment management efficiency and lower its management cost. Furthermore, by integrating the business operation advantage of both UD and Apacer, Apacer group will benefit from the synergy of this share exchange transaction and enhance its business performance. The Company will also share Apacer group's business success by obtaining dividends and will increase the Company's capital gains from the investment. By way of this share exchage transaction, it will bring positive benefits to the shareholders of the Company. 5.Purpose/objective of the share exchange:In order for Apacer and UD to intergrate both companyies' resources, to bring both companies' product development advantage into full play, to expand the niche market overseas, to have a deeper focus on its current market, and to enhance both companies' business performance and market competitiveness. 6.Shall the original shareholders be required to trade shares? Nature of the shares of the Company exchanged, volume, and the subject company's shareholding percentage of the company after the share exchange:The Company proposes to engage in the share exchange transaction to exchange its held 1,252,290 issued and outstanding shares of common stock of UD (shareholding percentage: approximately 17.4%) for 2,504,580 newly-issued shares of common stock of Apacer. Nature of the shares of the Company exchanged, volume, and the subject company's shareholding percentage of the company after the share exchange: N/A 7.Nature of the shares of the subject Company to exchange for,and volume:2,504,580 newly-issued shares of common stock of Apacer. 8.Anticipated benefits of the share exchange:By means of this share exchange transaction, the Company will continuously maintain good long term business relationship with Apacer group. And, by integrating the shareholding structure through the share exchange transaction, the Company can improve its investment management efficiency and lower its management cost. Furthermore, by integrating the business operation advantage of both UD and Apacer, Apacer group will benefit from the synergy of this share exchange transaction and enhance its business performance. The Company will also share Apacer group's business success by obtaining dividends and will increase the Company's capital gains from the investment. 9.Share exchange ratio and basis of its calculation:every 2 newly-issued shares of common stock of Apacer will be exchanged for 1 issued and outstanding share of common stock of UD. The exchange ratio of this share exchange transaction is determined based on the following factors: Apacer's stock price in the public market, Apacer's CPA-audited financial statements as of December 31, 2021, UD's CPA-audited financial statements as of December 31, 2021, earnings per share (EPS), book value per share, UD's market equity value and the business operation, financial status and the business outlook for the future of both UD and Apacer. The rationality of the exchange ratio is evidenced by the independent expert's opinion issued by CPA WeiChih Liu of L&L, Leaven & Co., CPAs Firm. 10.Has the CPA issued an opinion on the unreasonableness of the price of the current transaction?:No. 11.Name of the CPA firm:L&L, Leaven & Co., CPAs Firm 12.Name of the certifying CPA:CPA WeiChih Liu 13.The practice certificate number of the CPA:Financial-Supervisory- Securities-Corporate No.7730 14.Scheduled timetable for consummation:The closing date of this share exchange tansaction is scheduled on August 1, 2022.This transaction is also subject to the approval, the permission of the competent authorities for this share exchange transaction, and the actual operation procedures of the share exchange. 15.Basic information of the subject company:Apacer is mainly engaged in the manufacture and sales of DRAM mdule and NAND Flash related application products. UD is mainly engaged in the development, manufacture and sales of flash memory products. The main products are industrial applications and embedded memory products, including industrial-grade SSD and industrial memory cards. 16.Conditions and restrictions on future transfers of shares resulting from the share exchange:No 17.Current cumulative volume, amount, and shareholding percentage of holdings of the security being traded (including the current trade) and status of any restriction of rights (e.g.pledges):The Company proposes to engage in the share exchange transaction to exchange its held 1,252,290 issued and outstanding shares of common stock of UD for 2,504,580 newly-issued shares of common stock of Apacer. After this transaction, the Company does not hold any shares of common stock of UD. The company will cumulatively hold 12,554,580 shares of common stock of Apacer (including the current trade). The current cumulative amount of the Company's held shares of Apacer is NTD 528,159 thousand (Current trade calculated based on the closing price of Apacer on June 01, 2022 NTD 43.55. The actual price shall be based on the closing date of the share exchange). The company will cumulatively hold 11.24% of common stock of Apacer (including the current trade).The status of any restriction of rights: no. 18.Current ratio of long or short term securities investment (including the current trade) to the total assets and shareholder's equity as shown in the most recent financial statement and the operating capital as shown in the most recent financial statement:To total asset: 13.79%; To the shareholders'equity owners of the parent company: 23.21%; The operation capital in the most recent financial statement: NTD 26,408,464 thousand. 19.Other important stipulations:This share exchange transaction and the share exchange and cooperation agreement are subject to the adoption of UD shareholders' meeting. 20.Do the directors have any objection to the present transaction?:No. 21.The informaion of the directors that is an interested party (name of the directors, an explanation of the important aspects of the relationship of interest , the reasons why the director was required or not required to enter recusal, and the status of their recusal; opinions expressing objections or reservations):No. 22.Any other matters that need to be specified:The Company will enter into the share exchange and cooperation agreement.