Sunplus Technology : Announcement of the resolution of the board of directors of Sunplus to acquire the equity of Sunext Technology Co., Ltd.

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Provided by: SUNPLUS TECHNOLOGY CO.,LTD.
SEQ_NO	3	Date of announcement	2022/07/08	Time of announcement	17:08:19
Subject	Announcement of the resolution of the board of directors of Sunplus to acquire the equity of Sunext Technology Co., Ltd.
Date of events	2022/07/08	To which item it meets	paragraph 11
Statement	1.Type of merger and acquisition (e.g.merger, spin-off, acquisition, or share transfer):share exchange 2.Date of occurrence of the event:2022/07/08 3.Names of companies participating in the merger and acquisition (e.g., name of the other company participating in the merger, newly established company in a spin-off, acquired company, or company whose shares are transferred): Acquiring company:Sunplus Technology Co.,Ltd.(the company) 4.Trading counterparty (e.g., name of the other company participating in the merger, company spinning off, or trading counterparty to the acquisition or share transfer): Acquired company:Sunext Technology Co.,Ltd.(Sunext) 5.Whether the counterparty of the current transaction is a related party:Yes 6.Relationship between the trading counterparty and the Company (investee company in which the Company has re-invested and has shareholding of XX%), explanation of the reasons for the decision to acquire from or transfer shares to an affiliated enterprise or related party, and whether it will affect shareholders' equity: Sunext is the subsidiary of Sunplus and Sunplus owned 92.55% of the equity in Sunext.This share exchange proposal is based on the share exchange contract agreed by both parties and Article 30 of the Business Mergers and Acquisitions Act. And an independent expert has issued a rationality opinion on the acquisition amount. As a result,it will not affect shareholders'equity. 7.Purpose of the merger and acquisition: To simplify the shareholding structure and to improve the Group's operating performance. 8.Anticipated benefits of the merger and acquisition: The simplification of the group's shareholding structure is beneficial and it can improve overall business performance. 9.Effect of the merger and acquisition on net worth per share and earnings per share: After the share exchange is completed, the shareholding structure will be simplified and operating performance will be improved. And the net value per share of the company and the Earnings per share should be positive. 10.Follow-up procedures for mergers and acquisitions, including the time and method of payment of the consideration for mergers and acquisitions, etc.: (1)Share exchange with Sunext at a price of NT$4.0976 per share on the base date of share exchange. (2)The company expects to take back 4,730,658 shares of Sunext with a total acquisition amount of NT$19,384,345. 11.Types of consideration for mergers and acquisitions and sources of funds: In this share exchange case, the company will pay NT$4.0976 per share to the remaining shareholders of Sunext to obtain all the issued shares of Sunext. Sources of funds:owing fund. 12.Share exchange ratio and calculation assumptions: (1)Share exchange ratio: The company will pay NT$4.0976 per share to the remaining shareholders of Sunext to obtain all the issued shares of Sunext. (2)Calculation assumptions: Based on the price reasonableness opinion issued by independent experts. 13.Whether the CPA, lawyer or securities underwriter issued an unreasonable opinion regarding the transaction:No 14.Name of accounting, law or securities firm: LIAN WEI Certified Public Accountants 15.Name of CPA or lawyer: Chuck Lu 16.Practice certificate number of the CPA: FSCC No.3402 17.The content of the independent expert opinion on the reasonableness of the share exchange ratio, cash or other assets allotted to shareholders in this merger and acquisition: Independent experts evaluate the reasonableness of the share exchange price in accordance with asset approach. Internationally used evaluation approach include market approach,income approach and asset approach. Sunext has no clear plan for the future, so the evaluation approach of income approach and market approach is not suitable. As a result, the asset approach is the only method for this evaluation. The asset approach is more suitable for companies with definite asset value or specialization in investment. The value of Sunext can be more clearly expressed by the asset approach in current situation. The independent expert assessed the fair value of each share of Sunext was NT$4.0976.In this share exchange case, Sunplus plans to acquire the outstanding shares of Sunext at NT$ 4.0976 per share, which should be reasonable and should not affect the shareholders' equity of Sunplus. 18.Estimated date of completion: The base date for share exchange is set as August 31,2022. If readjustment is necessary due to the actual situation, the BOD of both parties shall negotiate and adjust the base date of share exchange and will announce it. 19.Matters related to the assumption of corporate rights and obligations of the dissolving company (or spin-off) by the existing or newly-established company:NA 20.Basic information of companies participating in the merger: The company is mainly engaged in the research, development, manufacture and sale of the following products: (1)Design, manufacture, testing and sales of various IC. (2)Design, manufacture, testing and sales of various IC modules. (3)Research, development and sales of various application software. (4)Research, development and sales of various silicon intellectual property. (5)Trading and agency business of various IC. Sunext is mainly engaged in the research, development, manufacture and sale of the following products: Optical storage servo chip and system chip 21.Matters related to the spin-off (including estimated value of the business and assets planned to be transferred to the existing company or new company.The total number of shares to be acquired by the spun-off company or its shareholders, and their respective types and no.Matters related to the reduction, if any, in capital of the spun-off company)(note: not applicable for announcements unrelated to spin-offs):NA 22.Conditions and restrictions for future transfer of shares resulting from the merger and acquisition:NA 23.The plan after the merger and acquisition is completed: This share exchange case is for the organizational adjustment to simplify the investment structure and improve business performance. It does not involve dissolution, delisting (office), major changes in organization, capital, business plans, finance and production, or any other material matter that affects the rights and interests of shareholders of the company. 24.Other important terms and conditions:No 25.Other major matters related to the mergers and acquisitions: This share exchange case is for the organizational adjustment to simplify the investment structure and improve business performance. It does not involve dissolution, delisting (office), major changes in organization, capital, business plans, finance and production, or any other material matter that affects the rights and interests of shareholders of the company. 26.Any objections from directors to the transaction:No 27.Information on interested directors involved in the mergers and acquisitions: Chairman:Chou-chye,Huang. Important content that the legal person on its own or its representative has an interest in: Chou-chye,Huang,Chairman of the company is also the Chairman of Sunext. As a result, the Chairman did not participate in discussions and vote due to interest avoidance. Avoid situations:Chairman did not participate in the discussion and voting due to interest avoidance. Reasons for or against the merger resolution:Chairman did not participate in the discussion and voting due to interest avoidance. 28.Whether the transaction involved in change of business model:No 29.Details on change of business model:NA 30.Details on transactions with the counterparty for the past year and the expected coming year:NA 31.Source of funds:owing fund. 32.Any other matters that need to be specified:No