ASIA CEMENT CORPORATION 2009 Annual Report

遠東集團 Stock Code:1102 http://newmops.twse.com.tw FAR EASTERN GROUP http://www.acc.com.tw

Notice to readers This English version annual report is a summary translation of the Chinese version and is not an official document of the shareholders’ meeting. If there is any discrepancy between the English version and Chinese version, the Chinese version shall prevail.

Printed on April 30, 2010

Spokesperson Headquarter and Plants Name: W.K. Chou Headquarter Title: Vice President Address: 30, 31F, No.207, Sec. 2, Tel: 886-2-27378940 Dunhua S. Rd., Da’an Dist., Taipei City E-mail: [email protected] 106, Taiwan Tel: 886-2-27338000 Deputy Spokesperson Name: Doris Wu Hsinchu Plant Title: Vice President Address: No.109, Sec. 2, Zhongfeng Tel: 886-2-27378945 Rd., Hengshan Township, Hsinchu E-mail: [email protected] County 312, Taiwan Tel: 886-3-5931011 Stock Transfer Agent Oriental Securities Corporation Hualien Plant Address: 3F., No.86, Sec. 1, Address: No.125, Xinxing Rd., Chongqing S. Rd., Zhongzheng Dist., Xincheng Township, Hualien County Taipei City 100, Taiwan 971, Taiwan Tel: 886-2-23618608 Tel: 886-3-8612101 Website: http://www.osc.com.tw/

Auditors Deloitte & Touche Auditors: Hsin Wei Tai and You Wei Fan Address: 12F, No.156, Sec. 3, Minsheng E. Rd., Zhongshan Dist., Taipei City 104, Taiwan Tel: 886-2-25459988 Website: http://www.deloitte.com/

Overseas Securities Exchange London Stock Exchange Disclosed information can be found at http://www.londonstockexchange.com/ Singapore Exchange Disclosed information can be found at http://www.sgx.com/

Corporate Website http://www.acc.com.tw/

TABLE OF CONTENTS

I. Report to Shareholders...... 1 II. Company Profile...... 7 2.1 Date of Incorporation...... 7 2.2 Company History...... 7 III. Corporate Governance Report...... 9 3.1 Organization ...... 9 3.1.1 Organization Chart...... 9 3.1.2 Major Corporate Functions...... 10 3.2 Directors, Supervisors and Management Team ...... 11 3.2.1 Directors and Supervisors...... 11 3.2.2 Major Shareholders of the Institutional Shareholders ...... 13 3.2.3 Major Shareholders of the Major Shareholders That Are Juridical Persons ...... 14 3.2.4 Professional Qualifications and Independence Analysis of Directors and Supervisors ...... 16 3.2.5 Management Team...... 17 3.2.6 Remuneration of Directors, Supervisors, President, and Vice Presidents ...... 19 3.3 Implementation of Corporate Governance ...... 24 3.3.1 Board of Directors ...... 24 3.3.2 Attendance of Supervisors for Board Meeting ...... 25 3.3.3 Corporate Governance Execution Status and Deviations from “Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies” ...... 26 3.3.4 The Execution Status of Internal Control System ...... 29 3.3.5 Major Resolutions of Shareholders’ Meeting and Board Meetings...... 30 3.4 Information of CPA Service Fee...... 32 3.5 Changes in Shareholding of Directors, Supervisors, Managers and Major Shareholders ...... 33 3.6 Information Disclosing the Relationship between any of the Company’s Top 10 Shareholders ...... 35 3.7 Shareholding Proportion of ACC to Investees...... 39 IV. Capital Formation...... 40 4.1 Capital and Shares ...... 40 4.1.1 Capital...... 40 4.1.2 Capital Increase in the Past Five Years...... 40 4.1.3 Shareholder Structure ...... 40 4.1.4 Shareholding Distribution Status...... 41

4.1.5 List of Major Shareholders...... 41 4.1.6 Market Price, Net Value, Earnings and Dividends per Share (2008~2010/4/30)....42 4.1.7 Dividend Policy & Implementation Status...... 42 4.1.8 The Impact of Dividend Distribution to be Resolved by 2010 Shareholders’ Meeting on Operating Performance ...... 43 4.1.9 Employees Bonus and Remuneration of Directors and Supervisors...... 43 4.2 Summary of Corporate Bonds ...... 45 4.2.1 Issued Corporate Bonds...... 45 4.2.2 Issued Exchangeable Bonds ...... 48 4.3 Summary of Issued GDR...... 49 4.4 Status on Execution of Capital Utilization Plans...... 50 4.4.1 Issue of the First Overseas Unsecured Exchangeable Bonds By 2008 ...... 50 V. Overview of Business Operation...... 52 5.1 Business Introduction ...... 52 5.1.1 Business Scope ...... 52 5.1.2 Industry Overview ...... 52 5.1.3 Technology and Research Development ...... 53 5.1.4 Short-term Business Plan...... 54 5.1.5 Long-term Business Plan...... 54 5.2 General Information of Market & Production...... 54 5.2.1. Markets Analysis ...... 54 5.2.2 Application of Major Cement Products...... 55 5.2.3 Supply Condition of Main Raw Materials...... 56 5.2.4 Major Suppliers Information for the Last Two Calendar Years...... 57 5.2.5 Major Clients Information for the Last Two Calendar Years ...... 57 5.2.6 Output of Main Products 2008-2009...... 58 5.2.7 Sales of Main Products 2008-2009...... 58 5.3 Human Resources ...... 59 5.4 Expenditures on Environmental Protection...... 59 5.4.1 ISO-14001 Environmental Management Systems (EMS)...... 59 5.4.2 Air Pollution Prevention ...... 60 5.4.3 Greening and Beautification for Quarry Restoration ...... 60 5.4.4 Major Environmental Protection Work in the Future ...... 61 5.4.5 Fulfill Social Responsibilities...... 61 5.5 Labor Relations...... 61 5.6 Major Contracts ...... 65

VI. Financial Information...... 67 6.1 Financial Reports & Audit Results (2005~2010/3/31) ...... 67 6.1.1 Balance Sheets...... 67 6.1.2 Statements of Income ...... 68 6.1.3 Auditors’ Opinions from 2005 to 2009...... 68 6.2 Financial Analysis (2005~2010/3/31)...... 69 6.3 Supervisors’ Review Report on the 2009 Financial Statements...... 70 6.4 Independent Auditors¡¦ Report...... 71 VII. Analysis of Financial Status, Operating Results, and Risk Management...... 81 7.1 Analysis of Financial Status...... 81 7.2 Analysis of Operating Results ...... 82 7.3 Analysis of Cash Flow...... 83 7.4 Impacts of Major Capital Expenditures on Finance and Operation ...... 84 7.4.1 Major Capital Expenditures and Funding Sources...... 84 7.4.2 Expected Benefit to Finance and Operation from the Major Capital Expenditure...... 84 7.5 Investment Strategies in the Most Recent Year, the Major Reasons for its Gain or Loss and Improvement Plan and Investment Plans for Next Year ...... 84 7.6 Analysis and Evaluation of Risk Management...... 84 7.6.1 The Impact from Fluctuation of Foreign Exchange and Interest Rates, and Inflation on the Company’s Profit and Loss and Its Countermeasures ...... 84 7.6.2 The Impact of Highly Risky/Leveraged Transaction, Loaning to Others, Endorsement and Guarantee for Others, and Derivatives ...... 85 VIII. Special Disclosure...... 87 8.1 Information about Affiliated Companies ...... 87 8.1.1 Organizational Chart of Affiliated Companies ...... 87 8.2 Basic Information of Affiliates ...... 88 8.3 The Main Business of Affiliates ...... 91 8.4 Information of the Directors, Supervisors, and Presidents of ACC Affiliates...... 91 8.5 Affiliates' Operating Condition...... 103

III

Report to Shareholders

I. REPORT TO SHAREHOLDERS

1.1 Preface Global financial tsunami triggered by subprime mortgage crisis brought global economy into the worst recession in 2009 since the World War II. Except some emerging economies, like China and India, most industrialized countries faced this worst recession in the first half of 2009. Fortunately, economic revitalization programs and loose monetary policies succeeded and supported the growth of market demands. Global economy resumed to growth in the second half of 2009. Meanwhile, Taiwan's export-oriented economy which electronic products take the major share was not isolated in this downturn. Taiwan economic growth rate was -1.87%, the worst record since 1951. However, this performance is still better than most forecasts and many developed countries, such as the economic growth rates -2.4%, -4.1%, and -5.0% in the US, EU, and Japan. In Four Asian Tigers, the economic growth rates in Hong Kong, Singapore, and South Korea are -2.5%, -2.0%, and 0.2%. Only South Korea outperformed Taiwan. For the cement industry, domestic demands in emerging markets, such as China, Africa, and India remains strong and are able to maintain growth in cement consumption. However, the EU, US, Russia, Japan, and Australia's cement demand showed a two-digit decline. The cement demand in the US showed 26% decline, the largest decline among these countries. In Taiwan, according to a statistics conducted by the Taiwan Cement Manufacturers’ Association, total cement and clinker sales by the domestic firms was 15.93 million MT in 2009, sliding 7.05% from previous year. Domestic sales amounted to 7.76 million MT, a descent of 18.14% from 2008. Export sales increased 6.66% to 8.17 million MT, compared to 2008. In 2009, Taiwan’s cement consumption amounted to 10.37 million MT, averaging out to 449 kg per capita, decreasing 12.3% from 512kg in 2008. In 2009, the construction industry in Taiwan experienced a downturn. Oversupply of cement coupled with cheap imported cement from China has made the profit performance among Taiwan cement industry far behind satisfaction. Meanwhile, with the concerted efforts of all staffs in Asia Cement Corporation, the Company still enjoys superior performance to all rivals. The 2009 sales of the Company was NT$ 9.962152 billion, decreased 5.26% from 2008. The operating income reduced 12.50% from 2008 to NT$ 900.633 million. Due to the outstanding performance of Far Eastern New Century Corp., U-Ming Marine Transport Corp., and the Company’s affiliates in China, the Company recognized NT$ 7.694554 billion investment income from equity method. The total net profit after tax reached NT$ 7.885009 billion. The net profit rate after tax was 79%. The 8th meeting of the 23rd Board Meeting resolved to distribute cash dividend NT$ 1.80 and stock dividend of NT$ 0.30 per share.

1.2 Operating Performance of 2009

1. Production: Difference Difference Item Cement Clinker compared to % compared to (MT) (MT) % Plant 2008 2008 Hsinchu Plant 664,896 634,083 Hualien Plant 3,708,608 -277,560 -5.97 3,963,557 -227,781 -4.72 Total 4,373,504 4,597,640 ＊Key Performance Indicator: Actual aggregate cement output amounted to 4,373,504MT. Compared to estimated output 4,848,000 MT, the achievement rate is 90.21%. Actual aggregate clinker output amounted to 4,597,640 MT. Compared to estimated output 5,047,000 MT, the achievement rate is 91.10%. 2. Sales Unit: NT$1,000; MT Vo lu me & 2009 Difference compared to 2008 Value Domestic Sales Export Sales Product Volume Value Volume Value Volume % Value % Cement & Clinker 2,587,581 6,029,587 2,320,961 3,239,428 -132,309 -2.62 -411,936 -4.26 slag powder 505,900 654,484 3,032 5,428 -119,877 -19.06 -168,993 -20.39 Total 3,093,481 6,684,071 2,323,993 3,244,856 -252,186 -4.44 -580,929 -5.52 ＊Key Performance Indicator: Actual aggregate sales of cement and clinker amounted to 4,908,542 MT. Compared to the estimated sales 5350,000 MT, achievement rate is 91.75%.

1.3 Business and Operating Results of ACC in China Fourteen years ago, Asia Cement Corporation pioneered all domestic rivals to invest in cement business in China after Taiwan Government permitted domestic firms to invest in China. On May 20, 2008, Asia Cement (China) Holdings Corporation, the subsidiary of the Company, was listed on the Main Board of Hong Kong Exchanges and Clearing Limited. Currently, the Company’s investing activities in China are mainly based in Jiangxi, Sichuan, Hubei, Yangzhou and Shanghai areas. The overall operating strategies are deployed through Jiangxi Yadong Cement Co., Sichuan Yadong Cement Co., Hubei Yadong Cement Co., and Yangzhou Yadong Cement Co. as core production bases in the Southeast China, Southwest China, Middle China, and East Coast respectively. Besides, in collaboration with Huanggang Yadong Cement Co., three grinding factories, six cement products companies, four transportation companies, five terminals, and eight sale offices, these constitute an efficient and solid network for production, transportation and sales. In 2010, the acquisition of the Wuhan XinLingYun Engineering Co, Ltd is a remarkable milestone of Asia Cement (China) Holdings Corporation which enables the continuous growth in China. In the future, Asia Cement (China) Holdings Corporation will continue expand capacity

Report to Shareholders

through self-built of new production line or merger & acquisition. This double-track approach can expand the influence of Asia Cement (China) Holdings Corporation in different market segments. In light of the continuing growth of China’s economic development, the cement consumption in China reached 1.63 billion MT in 2009, increasing 17% compared to 1.388 billion MT in 2008. The subsidiaries of ACC in China show the following achievements. The aggregate output of clinker in 2009 amounted to 9.92 million MT, increasing 47% compared to 2008. The aggregate sales of cement, clinker, and slag powder in 2009 amounted to 14.44 million MT, increasing 41% compared to 2008. The 2009 net income after tax of the Company’s business in China reached NT$ 3.012789 billion for which the Company and its subsidiaries recognized NT$ 2.177945 billion investment income.

1.4 Overview of ACC’s Investment in China 1. Jiangxi Yadong Cement Co., Ltd The company planed four-stage construction of four kilns, each with annual clinker capacity of 1.65 million MT. The four stage construction projects have been completed and begun to operate in July 2000, September 2003, July 2007, and May 2010 respectively. Currently, the annual output of clinker reaches 6.6 million MT which can produce 8 million MT cement. In addition, the waste heat recycling generators of the No.1, 2, and 3 kilns can produce 145 million KWH electricity annually. This substantially reduces electricity costs and minimizes the dependence on external power supply. With the full support of the Jiangxi Province Government, the company plan to build 5th and 6th production line for cement and clinker. Upon the completion of each production line, each kiln can increase 2.35 million MT of clinker capacity, which can produce 2.85 million MT cement. 2. Sichuan Yadong Cement Co., Ltd The company planed three-stage construction of three kilns with annual clinker capacity of 1.65 million MT respectively. The three stage construction projects have been completed and begun to operate in September 2006, December 2008, and March 2010. Currently, the annual output of clinker reaches 4.95 million MT which can produce 6 million MT cement. The three-stage construction and production goal has been achieved to serve the demand from Chengdu areas and the earthquake recovery plan. In addition, the waste heat recycling generators of the No.1, 2, and 3 kilns can produce 145 million KWH electricity annually. This substantially reduces electricity costs and minimizes the dependence on external power supply. 3. Hubei Yadong Cement Co., Ltd The company has two-stage construction plan of two kilns with annual clinker capacity of 1.65 million MT respectively. The first stage construction has been completed in March 2009. The annual output of clinker is amounted to 1.65 million MT which can produce 2 million MT cement. The second stage construction is expected to be completed in November 2010. The annual output of clinker will reach 3.3 million MT which can produce 4 million MT cement.

4. Huanggang Yadong Cement Co., Ltd The company planed to construct one kiln. The construction has been completed and begun to operate in May 2010. The annual output of clinker amounts to 1.65 million MT which can produce 2 million MT cement. 5. Yangzhou Yadong Cement Co., Ltd The grinding factory can produce 2.1 million MT cement annually. With a new roller-press starting to operate in June 2010, total capacity can reach 2.8 million MT cement annually. Besides, the mixer station can produce ready-mixed concrete for the market. 6. Wuhan Yadong Cement Co., Ltd The company can produce 1.6 million MT cement and 0.6 million MT slag powder annually to supply the market in Wuhan area. 7. Nanchang Yadong Cement Co., Ltd The company can produce 0.6 million MT slag powder and 1.2 million MT slag cement annually to supply the market in Nanchang area. 8. Chengdu Yaxin Slag Powder Co., Ltd The second production line of the company has been completed in March 2010. Currently, the company can produce 0.5 million MT slag powder annually. 9. Wuhan Yaxin Cement Co., Ltd To enhance the market position and market share of the “Skyscraper” cement in Wuhan and to supply the market around Jiangnan areas, Hubei Yadong Cement Co., Ltd acquired 70% shares of the Wuhan XinLingYun Engineering Co, Ltd which is a profitable cement factory with annual cement capacity of 1.5 million MT. After the acquisition, the company changed its name to “Wuhan Yaxin Cement Co., Ltd.” The company will market its products with the brand of “Skyscraper” and “LingYun” to the market around Jiangnan and Xianning areas in Wuhan.

1.5 Business goal for 2010 To fully sell out the estimated production volume has been the Company’s persistent principle. Even the intense cement industries competition across Taiwan Strait, the Company still exerts all strength to reach this goal. The Company has set the following goals for 2010: the Hsinchu Plant is expected to produce 530,000 MT cement and 500,000 MT clinker; the Hualien Plant is expected to produce 4,010,000 MT cement and 4,333,000 MT clinker. The total production volume of the Hsinchu and Hualien plant will achieve 4,540,000 MT cement and 4,833,000 MT clinker. The estimated sales of cement and clinker are 5,140,000 MT. The total production volume of the Company’s affiliates in China will achieve 14.08 million MT clinker and 19.46 million MT cement. The estimated sale of cement is 19.07 million MT.

Report to Shareholders

1.6 Business Prospects for 2010 In the past two years since Mr. Ma Ying-jeou was elected as the President of the Republic of China, the relationship across Taiwan Strait has been substantially improved. Meanwhile, Taiwan people deeply concern the ratification of the three cross-strait financial supervision memorandums of agreement and the negotiation of the Economic Cooperation Framework Agreement (ECFA) between Taiwan and China. Although the actual impact is still unknown, one thing can be confirmed: since ECFA is expected to be ratified in the first half of 2010, it will definitely affect Taiwan's economy greatly in 2010. According to the latest World Bank report, the 2010 Global Investment Environment Improving Rating, Taiwan has top-five improvement among all countries. Besides, Taiwan's rating in the World Competitiveness Yearbook compiled by IMD Business School (Switzerland) surged from No. 23 to No. 8, the best record received so far. In addition to enhancing private sector competitiveness, the rating of economic performance, government efficiency, infrastructure and business efficiency in the public sector also improved significantly. This rating jump indicated that the effects of the Government’s economic policies in recent years have gradually shown up. For the economic outlook of 2010, the U.S. capital market has gradually recovered, though it still requires continuous observation. Japan and EU's economy also entered into a slow recovery. The China's economy shows no sign of slowdown; its economic growth rate is estimated to be more than 10%. China will continue to serve as the momentum of global economic growth. Other emerging economies will remain robust economic growth. Although with the risks of high unemployment rates, soaring sovereign debts, and the economic bubbles in developed countries, most people still optimistically believe that the global economic growth in 2010 will be better than in 2009. Domestic and foreign institutions and foreign securities firms predict that Taiwan's economic growth rate will range from 4.65% to 6.5%. Since Taiwan cement manufacturers can not easily equilibrate the surplus production via exporting and also be threatened by the cheap imported cement from China, Taiwan cement industry still faces difficulties and stress in 2010. However, to response to the global financial tsunami, the governments across the Taiwan Strait adopted the strategy of expanding domestic demand to boost the economy. The Council for Economic Planning and Development in Taiwan proposed an economic revitalization policy – “Project to Expand Investment in Public Works”, a four-year NT$ 500 billion investment project. The main construction items include Taiwan Taoyuan International Airport Access MRT System, West Coast Expressway Construction Project, Taichung Railway Grade-Separation Project, Kaohsiung Railway Underground Project, Widening Project of Wugu-Yangmei section of National Freeway No.1, Fengyuan-Takeng Section, National Expressway No.4 and Taichung Metropolis Road No.4, expanding the construction of wastewater sewers, rebuilding of old and damaged bridges, and strengthening and rebuilding of old school buildings. All these construction projects together with special budget for flood control projects will benefit the domestic cement industry. Furthermore, the China Government adopted a RMB $4 million million revitalization policy aiming to expand public works, especially on water infrastructures and transportation projects. These efforts accompanied with the economic-stimulating

measures of its local governments will contribute to more cement consumptions. Asia Cement (China) Holdings Corporation currently has nine production lines in China and is expected to have one more production line in November 2010. With the timely release of production capacity, the significant growth of the business performance of Asia Cement (China) Holdings Corporation is highly expected.

1.7 The Operating Performance in the First Quarter of 2010 The operating Income of the Company in the first quarter of 2010 is NT$ 29.844 million, decreasing 93.28% compared to the first quarter of 2009. The main factors which caused operating margin to decline are dropping cement price and raising price of raw materials. Meanwhile, as result of the fantastic performance of the affiliate companies, the Company recognized investment income NT$ 1.614305 billion from equity method, which is higher than NT$ 1.591863 billion in the first quarter of 2009.

＊References: “Economic Outlook Bimonthly” published by Chung-Hua Institution for conomic Research, “International Economy Bi-weekly”, “Taiwan Cement Industry Review”, and related currency exchange rate reports.

Company Profile

II. COMPANY PROFILE

2.1 Date of Incorporation: March 21, 1957. Authorized Capital: TWD $29,857,354,830.

Scope of Business: 01. C901030 Cement manufacturing 11. H701010 Developing, leasing, and selling 02. C901040 Ready-mixed concrete residential and business buildings manufacturing 12. H701020 Developing, leasing, and selling 03. B601010 Quarrying industrial factories 04. C901050 Cement and ready-mixed 13. H703100 Real estate rental & leasing concrete products 14. H703090 Real estate sale & purchase 05. C901990 Non-metallic mineral products 15. JE01010 Rental and leasing 06. F111090 Whole sale of building materials 16. G202010 Parking-lot business 07. F211010 Retail sale of building materials 17. G801010 Warehousing 08. F401010 International trade 18. I103060 Business management consultation 09. IZ06010 Tally and packing services 10. A201010 Afforestation business 19. J101040 Waste treatment In addition to permitted scope of business, the Company can broaden its business not prohibited or restricted by laws.

2.2 Company History The Company was founded by Mr. Y.Z. Hsu and approved for registration and incorporation on March 21, 1957. The Major events in recent 5 years are shown as the following table: Year Major events Oct. 2005 The Hualien Plant was awarded “Excellent Company for Adopting National Standards” by the Bureau of Standards, Metrology and Inspection, M.O.E.A. Nov. 2005 The Hualien Plant was awarded “Excellent Working Environment for Smoking Prevention” by the Bureau of Health Promotion, Department of Health. Nov. 2005 The Hualien Plant was awarded “2005 Industrial Excellence” by Industrial Development Bureau, Ministry of Economic Affairs. Dec. 2005 The Company was awarded “Excellent Company for Hiring Aborigines ” by the Executive Yuan. Mar. 2006 The waste heat recycling generators of no.1 and no.2 kilns of Jiangxi Yadong Cement Co., Ltd began operation. Sep. 2006 The no. 1 kiln of Sichuan Yadong Cement Co., Ltd began operation. Mar. 2007 The Hualien Plant was awarded for the excellent performance in the project of “promoting green communities” by Environmental Protection Administration, Executive Yuan. Jun. 2007 The waste heat recycling generators of No.1 kiln of Sichuan Yadong Cement Co., Ltd began operation.

Year Major events Jul. 2007 The No. 1 cement mill of Hubei Yadong Cement Co., Ltd began operation. Jul. 2007 The no. 3 kiln of Jiangxi Yadong Cement Co., Ltd began operation. Aug. 2007 The waste heat recycling generators of no.3 kiln of Jiangxi Yadong Cement Co., Ltd began operation. May. 2008 The Jiangxi Yadong Cement Co., Ltd passed OHSMS 18000 Occupational Health and Safety Management System. May. 2008 Asia Cement (China) Holdings Corporation was listed on the Main Board of The Stock Exchange of Hong Kong Limited. Jul. 2008 The grinding factory of YangZhou Yadong Cement Co., Ltd. began operation. Dec. 2008 The no.2 kiln of Sichuan Yadong Cement Co., Ltd. began operation. Dec. 2008 The Hualien Plant was awarded “First National ISO 14064 Greenhouse Gas Assessment” by the Bureau of Standards, Metrology and Inspection, M.O.E.A. Feb. 2009 Sichuan Yadong Cement Co., Ltd completed a 12.58 kilometer-long belt conveyor and began operation. Feb. 2009 The waste heat recycling generators of no.2 kiln of Sichuan Yadong Cement Co., Ltd. began operation. Feb. 2009 The Hualien Plant was the first plant awarded “TOSHMS: 2007 Taiwan Occupational Safety and Health Management Systems” in cement industry. Mar. 2009 The no.1 kiln of Hubei Yadong Cement Co., Ltd. began operation. Jul. 2009 The Hualien Plant was awarded “ISO 9001: 2008 International Quality Management System Standard” by the Bureau of Standards, Metrology and Inspection, M.O.E.A. Nov. 2009 The Hualien Plant was awarded “2009 Excellent Company for Voluntary Reduction of Greenhouse Gas Emissions” by the Industrial Development Bureau, MOEA. Dec. 2009 The Hualien Plant was the first plant awarded “ISO 27001: 2005 Information security management systems” in building material industry. Mar. 2010 The no.3 kiln of Sichuan Yadong Cement Co., Ltd. began operation. Apr. 2010 The waste heat recycling generators of no.3 kiln of Sichuan Yadong Cement Co., Ltd began operation. May. 2010 The no.1 kiln of Huanggang Yadong Cement Co., Ltd. began operation. May. 2010 The no.4 kiln of Jiangxi Yadong Cement Co., Ltd. began operation. During the most recent fiscal year and the current fiscal year up to the date of printing of the annual report, there are no important events listed below impacting on the shareholders’ equity of the Company: 1. Mergers and acquisitions. 2. To restructure affiliate companies. 3. Large volume shares transferred or changed by directors, supervisors, or major shareholders who own more than 10% shareholding. 4. Changes in the Company’s management. 5. Significant changes in business modes or business scope.

III. CORPORATE GOVERNANCE REPORT 3.1 Organization 3.1.1 Organization Chart

______Administration System Shareholders’ Meeting …………….. Technology System

Board of Directors Supervisors

Chairman - 9 9 Vice Chairman

President President Office Corporate Governance Report Corporate Governance

General Plant Manager Chief Engineer Vice President Chief Auditor

Assistant Vice President

Export Domestic Credit Hualien Hsinchu Purchasing Finance Accounting Occupational Secretarial Auditing Committee Sales Sales IT Dept. Safety Office HR Dept. Plant Plant Dept. Dept. Dept. Dept. Dept. Dept. Dept.

3.1.2 Major Corporate Functions Company Organization with Functions of Risk Management

Department Primary Functions Directly report to the Board of Directors. Plan and revise internal control Auditing Dept. system, evaluating each department’s operation and procedures in order to work out risk-management orientated annual auditing plan. Assist ACC President to deal with daily affairs, plan operation strategies, and President Office review the middle-term and long-term investment to reduce the risks resulting from improper decisions. Handle the affairs of general services, secretary, legal affairs, public relations, Secretarial Dept. etc. Reinforce legal sense of employees to decrease the risks of violating law. HR Dept. Plan and implement human resource policies to reduce relevant risks. Responsible for occupational safety and health management, formulating Occupational policies and supervising related affairs to ensure safety of workers and reduce Safety Office the risk and loss of occupational hazards. Handle all accounting matters including the costs, accounts, taxation to ensure Accounting management efficiency of the Company’s operation, the reliability of financial Dept. report, and the adherence of related accounting regulations to reduce company operation risks. Responsible for financial operation strategy, investment strategy, financial management, and dividend strategy, as well as investor relationship in order to Finance Dept. minimize financial exposure, uphold financial opportunity and maximize shareholders’ best interest. Cope with all affairs relating to information operation system, office automation, internal and external website applications and information security IT Dept. to the needs of operation, management and strategy to prevent the risk of information security and its efficiency. Domestic Sales Plan and implement domestic marketing strategy, credit customers, and identify Dept. market trends to achieve business goals and reduce relevant risks. Export Sales Plan and implement oversea marketing strategy, credit customers, and identify Dept. market trends to achieve business goals and reduce relevant risks. Handle all purchasing and contract issuing matters, setting up hedging Purchasing mechanism to cope with changes in raw materials prices and shortage of raw Dept. materials supply. Take charge of R&D, production technology, quality control, planning Hsinchu Plant production policies in collaboration with sales strategies to reduce production risks. Take charge of R&D, production technology, quality control, planning Hualien Plant production policies in collaboration with sales strategies to reduce production risks. Credit Execute “Regulations for Managing Client’s Credit” enacted by the Company Committee and take charge of risk control of account receivable.

3.2 Directors, Supervisors and Management Team 3.2.1 Directors and Supervisors April 30, 2010 Executives, Directors or Shareholding when Current Shareholding Spouse & Minor Experience Other Title Supervisors who are Title Name Date Term Date First Elected Shareholding （Education） spouses or within two Elected (Years) Elected degrees of kinship Shares % Shares % Shares % Title Name Relation Master, Chairman, Far Director Connie Sibling Chairman Douglas Tong 2008.06.17 3 1975.04.28 18,283,568 0.67% 20,676,499 0.69%7,216,270 0.24%Columbia Eastern New Hsu Peter Hsu University Century Corp. Director Hsu Sibling 373,705 0.01% 408,010 0.01% CEO, Asia Director T.H. Chang 2008.06.17 3 1981.04.24 37,570 0.00% President, Asia Cement(China) - - - *657,751,161*24.05%*666,632,716 *22.33% Cement Corp. Holdings Corp. 653,886 0.02% 713,912 0.02% Master, Vice Chairman, Far Director Johnny Shih 2008.06.17 3 1984.04.25 7,873,260 0.26% Columbia Eastern New - - - *657,751,161*24.05%*666,632,716 *22.33% University Century Corp. Chairman, Chairman, X.Z. 8,712,141 0.32% 9,511,915 0.32% Director H.S. Ying 2008.06.17 3 1969.04.30 00Yu Yuan Ying-Chai - - - *10,758,611 *0.39% *11,746,250 *0.39% Investment Co., Memorial 11 11 Ltd Foundation 275,331 0.01% 300,605 0.01% Managing Partner, Director C.V. Chen 2008.06.17 3 1987.04.16 00Ph.D., Harvard Lee and Li - - - *657,751,161*24.05%*666,632,716 *22.33% University Attorneys-At-Law Master, Stanford Executive Vice Douglas 2008.06.17 3 6,808,409 0.25% 8,619,660 0.29%2,202,198 0.07% President, Far ChairmanTong Hsu Sibling Director Peter Hsu 2002.06.07 University & Eastern New Director Connie Sibling UCLA Century Corp. Hsu Chief Counselor, Director K.T. Li 2008.06.17 3 1978.04.21 523,060 0.02% 571,076 0.02% 0 0Master, New Lee and Li - - - Report Corporate Governance York University Attorneys-At-Law 11,604,359 0.42% 12,670,355 0.42% Bachelor, Director, Oriental Douglas Director Connie Hsu 2008.06.17 3 1990.04.12 00California State Institute of ChairmanTong Hsu Sibling *3,935,478 *0.14% *4,296,754 *0.14% University Technology Director Peter Hsu Sibling PhD., Case 0 0 0 0 Director Chin-Der Ou 2008.06.17 3 2005.06.09 00Western Chairman, - - - *657,751,161*24.05%*666,632,716 *22.33% Reserve THSRC University Ta-Chou 0 0 0 0 Ph.D., Cornell Chairman, Grand Director 2008.06.17 3 2006.08.18 00 - - - Huang *1,224,865 *0.04% *1,337,306 *0.04% University Hotel Master, Consultant, Director Kao Chao Lee 2008.06.17 3 2005.06.09 0 0 0 0 0 0Vandenberg - - - CEPD University

Executives, Directors or Shareholding when Current Shareholding Spouse & Minor Experience Other Title Supervisors who are Title Name Date Term Date First Elected Shareholding （Education） spouses or within two Elected (Years) Elected degrees of kinship Shares % Shares % Shares % Title Name Relation Chairman, President, Asia 1,166,519 0.04% 2,097,605 0.07% Ya Tung Cement Corp.; Director K.Y. Lee 2008.06.17 3 2005.06.09 00Ready-Mixed Director, U-Ming - - - *599,331 *0.02% *1,683,318 *0.06% Concrete Co., Marine Transport Ltd Corp. Chief Senior Bachelor, 125,971 0.00% 137,534 0.00% Executive Vice Supervisor S.Y. Wang 2008.06.17 3 1993.05.07 00National Chung President, Far - - - *144,828,925 *5.30%*161,272,929 *5.40% Hsing Eastern New University Century Corp. Executive Vice 0 0 0 0 Master, Texas President, Far Supervisor Champion Lee 2008.06.17 3 2002.06.07 00 - - - *3,131,722 *0.11% *3,419,213 *0.11% A&I University Eastern New Century Corp. Bachelor, 0 0 0 0 Chairman, Yuan Supervisor L.T. Chang 2008.06.17 3 1999.05.14 00Chung-Yuan Fang Industry - - - *10,420,333 *0.38% *15,626,918 *0.52% Christian University Ltd. 12 Vice Chairman, Supervisor T.Y. Tung 2008.06.17 3 2002.06.07 3,265,484 0.12% 3,565,255 0.12% 0 0Ph.D., Stanford Elite Material - - - University Co., Ltd Master, Director, Yuan Ze Supervisor Eli C.Wang 2008.06.17 3 2002.06.07 00 0 0 00University of - - - Illinois University Note 1: Information on Directors and Supervisors that are Representatives of Institutional Investors: Representatives of Far Eastern New Century Corp.: Director T.H. Chang, Director Johnny Shih , Director C.V. Chen, Director Chin-Der Ou; Representative of X.Z. Ying-Chai Memorial Foundation: Director H.S. Ying; Representative of U-Ming Corp.: Director Ta-Chou Huang; Representative of Yue Ding Industry Co., Ltd.: Director K.Y. Lee; Representative of Huey Kang Investment Corp.: Director Connie Hsu; Representative of Far Eastern Medical Foundation: Supervisor S.Y. Wang; Representative of Bai-Yang Investment Holdings Corp.: Supervisor Champion Lee; Representative of Kai-Yuan International Investment Holdings Corp.: Supervisor L.T. Chang. Note 2: “*” indicates the number of shares held by Institutional Investors respectively represented by directors and supervisors listed above.. Note 3: There is no ACC director or supervisor holding shares in the name of other person.

Corporate Governance Report

3.2.2 Major Shareholders of the Institutional Shareholders

Major Shareholder of the Institutional Name of Institutional Shareholder % Shareholders Asia Cement Corporation 22.31 Oriental Institute of Technology 4.81 Far Eastern Medical Foundation 3.59 Far Eastern Memory Foundation 2.99 Yuan-Ze University 2.74 Der Ching Investment Corp. 1.59 Far Eastern New Century Corporation China Trust Commercial Bank Trust 1.46 Account – Asia Cement Corporation Saudi Arabian Monetary Agency Morgan Stanley Investment Management Limited 1.44 as external fund manager Douglas Tong Hsu 1.14 Yu Yuan Investment Co., Ltd 0.90 Connie Hsu 50.58 Huey Kang Investment Corp. H.G.Yang 24.71 H.M.Yang 24.71 U-Ming Corp. Far Eastern Department Stores Co.,Ltd. 100.00 Fu Da Transportation Co.,Ltd. 26.95 An Ho Garment Co.,Ltd. 26.50 Yue-Tung Investment Corp. 25.36 Ton Fu Investment Corp. 4.61 Ta Chu Chemical Fiber Co.,Ltd. 3.89 Yue Ding Industry Co.,Ltd. Ya Li Precast Prestressed Concrete 3.89 Industries Corp. Yu Ming Co.,Ltd. 2.59 Yuan Ding Co.,Ltd. 2.59 Bai Ding Investment Co., Ltd. 2.31 Ding Yuan International Investment Corp. 1.30 Bai Yang Investment Corp. Far Eastern Department Stores Co.,Ltd. 100.00 Kai Yuan International Investment Far Eastern New Century Corporation 100.00 Corp.

3.2.3 Major Shareholders of the Major Shareholders That Are Juridical Persons Name of Juridical Persons Major Shareholder of the Juridical Persons % Far Eastern New Century Corporation 22.33 Far Eastern Medical Foundation 5.40 Yu Yuan Investment Co., Ltd 5.32 Management Board of the Public Service 1.86 Pension Fund Far Eastern Department Stores Co., Ltd. 1.82 Asia Cement Corporation Bai Ding Investment Co., Ltd. 1.61 Yuan-Ze University 1.41 Labor Pension Fund Committee of Far Eastern New 1.13 Century Corporation Yu Chang Investment Co., Ltd. 1.04 Labor Pension Fund Supervisory Committee of Asia 0.92 Cement Corporation Der Ching Investment Corp. Asia Cement Corporation 99.99 Asia Cement Corporation 36.42 Yuan Ding Co.,Ltd. 25.02 Yu Yuan Investment Co., Ltd Yuan Ding Investment Company 19.05 U-Ming Marine Transport Corp. 17.66 Yue-Tung Investment Corp. 1.84 Far Eastern New Century Corporation 16.80 Asia Cement Corporation 5.56 Yuan-Ze University 4.68 Yu Yuan Investment Co., Ltd 2.02 The committee of Employee Pension Fund of Far 1.86 Far Eastern Department Stores Eastern Department Stores Co., Ltd. Co.,Ltd. HSBC as Trustee For The China Fund Inc. 1.57 Guardian Baillie Gifford Emerging Markets Fund 1.24 Schroder International Selection Fund Emerging Asia 1.17 Labor Pension Fund Committee of Far Eastern New 1.12 Century Corporation Bai Ding Investment Co., Ltd. 1.10 Fu Ming Transportation Co.,Ltd. 99.90 Johnny Shih 0.03 Fu Da Transportation Co.,Ltd. K.Y. Lee 0.03 T.C. Liu 0.03 An Ho Garment Co.,Ltd. Far Eastern New Century Corporation 100.00 U-Ming Marine Transport Corp. 73.54 Yue-Tung Investment Corp. U-Ming Marine Transport (Singapore) Private LTD. 26.46 Ton Fu Investment Corp. Oriental Union Chemical Corp. 100.00 Yuan Ding Investment Company 41.86 Ta Chu Chemical Fiber Co.,Ltd. Yue Ding Industry Co.,Ltd. 38.76 Yue-Lee Investment Company 19.38

Corporate Governance Report

Name of Juridical Persons Major Shareholder of the Juridical Persons % Asia Cement Corporation 83.81 Far-Eastern Construction Engineering Co.,Ltd. 16.03 Douglas Tong Hsu 0.01 T.H. Chang 0.03 Ya Li Precast Prestressed Concrete K.Y. Lee 0.03 Industries Corp. H.S. Hsu 0.01 R.H. Shao 0.03 C.F. Cheng 0.01 H.M. Yang 0.01 H.G. Yang 0.02 Bai Ding Investment Co., Ltd 47.00 Yuan Ding Investment Company 45.50 Yue Ding Industry Co.,Ltd. 5.00 Yu Ming Co.,Ltd. Yuan Ding Co.,Ltd. 1.00 Ding & Ding Management Consultants Co., Ltd 1.00 Yuan Ding Leasing Corp. 0.50 Far Eastern New Century Corporation 37.13 Asia Cement Corporation 35.50 Der Ching Investment Corp. 14.50 Yuan Ding Investment Company 12.86 Yuan Ding Co.,Ltd. Yu Ming Co.,Ltd. 0.003 Far Eastern Department Stores Co.,Ltd. 0.001 Douglas Tong Hsu 0.001 John Hsu 0.001 Far Eastern Department Stores Co.,Ltd. 66.66 Bai Ding Investment Corp. Bai Yang Investment Corp. 33.34 Ding Yuan International Far Eastern New Century Corporation 100.00 Investment Corp. Asia Cement Corporation 22.31 Oriental Institute of Technology 4.81 Far Eastern Medical Foundation 3.59 Far Eastern Memory Foundation 2.99 Yuan-Ze University 2.74 Der Ching Investment Corp. 1.59 Far Eastern New Century China trust Commercial Bank Trust Account – Asia Corporation 1.46 Cement Corporation Saudi Arabian Monetary Agency Morgan Stanley Investment Management Limited as external fund 1.44 manager Douglas Tong Hsu 1.14 Yu Yuan Investment Co., Ltd 0.90

3.2.4 Professional Qualifications and Independence Analysis of Directors and Supervisors April 30, 2010 Meet One of the Following Professional Qualification Requirements, Together with at Least Independence Criteria(Note) Five Years Work Experience Number of Criteria Other Public An Instructor or Higher A Judge, Public Prosecutor, Have Work Experience in Companies in Position in a Department of Attorney, Certified Public the Areas of Commerce, Which the Commerce, Law, Finance, Accountant, or Other Law, Finance, or Individual is Accounting, or Other Professional or Technical Accounting, or Otherwise Concurrently Academic Department Related Specialist Who has Passed a Necessary for the 12345678910 Serving as an to the Business Needs of the National Examination and been Business of the Company Independent Name Company in a Public or Awarded a Certificate in a Private Junior College, Profession Necessary for the Director College or University Business of the Company Douglas Tong Hsu ˇ ˇ ˇ ˇ ˇ 0 T.H. Chang ˇ ˇ ˇ ˇ ˇ ˇ 0 Johnny Shih ˇ ˇ ˇ ˇ ˇ ˇ 0 H.S. Ying ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 - 16 C.V. Chen ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 16 Peter Hsu ˇ ˇ ˇ ˇ ˇ 0 K.T. Li ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Connie Hsu ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Chin-Der Ou ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Ta-Chou Huang ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Kao Chao Lee ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 K.Y. Lee ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 S.Y. Wang ˇ ˇ ˇ ˇ ˇ ˇ 0 Champion Lee ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 L.T. Chang ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 T.Y. Tung ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 0 Eli C.Wang ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ ˇ 1 Note: Please tick the corresponding boxes if directors or supervisors have been any of the following during the two years prior to being elected or during the term of office. 1. Not an employee of the Company or any of its affiliates. 2. Not a director or supervisor of the Company or any of its affiliates. The same does not apply, however, in cases where the person is an independent director of the Company, its parent company, or any subsidiary in which the Company holds, directly or indirectly, more than 50% of the voting shares. 3. Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of 1% or more of the total number of outstanding shares of the Company or ranking in the top 10 in holdings.

4. Not a spouse, relative within the second degree of kinship, or lineal relative within the fifth degree of kinship, of any of the persons in the preceding three subparagraphs. 5. Not a director, supervisor, or employee of a corporate shareholder that directly holds 5% or more of the total number of outstanding shares of the Company or that holds shares ranking in the top five in holdings. 6. Not a director, supervisor, officer, or shareholder holding 5% or more of the share, of a specified company or institution that has a financial or business relationship with the Company. 7. Not a professional individual who, or an owner, partner, director, supervisor, or officer of a sole proprietorship, partnership, company, or institution that, provides commercial, legal, financial, accounting services or consultation to the Company or to any affiliate of the Company, or a spouse thereof. 8. Not having a marital relationship, or a relative within the second degree of kinship to any other director of the Company. 9. Not been a person of any conditions defined in Article 30 of the Company Act. 10. Not a governmental, juridical person or its representative as defined in Article 27 of the Company Act. * There is no director elected as independent director in the 23rd Board of Directors.

3.2.5 Management Team

Spouse & Minor Shareholding Title Name Date Effective Shareholding Experience（Education） Other Title - 17

17 Shares % Shares % Chairman of Ya Tung Director, President K.Y. Lee 2000.08.01 2,097,605 0.0703 0 0 Ready-Mixed Concrete Co., U-Ming Marine LTD Transport Corp. Director, Chief Executive Bachelor degree in Chemical, Y.F. Chang 2000.08.01 724 0.0000 0 0 China Hi-Ment Vice President Tunghai University

Corporation Report Corporate Governance Bachelor degree in Supervisor, Executive Vice R.H. Shao 2000.08.01 68,051 0.0023 2,172 0.0001 Accounting, U-Ming Marine President Soochow University Transport Corp. Bachelor degree in Supervisor, Chief Auditor Y.M. Shih 2007.07.25 0 0 2,102 0.0001 Accounting, Ya Li Transportation Co. Soochow University Ltd. Bachelor degree in Director, Vice President Doris Wu 2007.07.25 0 0 0 0 Accounting, Yu Yuan Investment Co., California State University Ltd Bachelor degree in Chairman, Vice President C.M. Chen 2007.07.01 35,354 0.0012 60,931 0.0020 International Trade, Tamkang Yu Yuan Investment Co., University Ltd

Spouse & Minor Shareholding Title Name Date Effective Shareholding Experience（Education） Other Title Shares % Shares % Bachelor degree in Law, Supervisor, Vice President W.K. Chou 2007.07.01 4,410 0.0001 0 0 Soochow University Pan Asia Corporation Bachelor degree in Electrical Supervisor, General Plant Z.P. Chang 2009.07.01 30,201 0.0010 47,600 0.0016 Engineering, National Taiwan U-Ming Marine Manager University Transport Corp Bachelor degree in Manager of the Mechanical Engineering, Director, Z.F. Lin 2003.05.01 8,786 0.0003 0 0 Hsinchu Plant National Taipei Institute of Nan Hwa Cement Corp. Technology Bachelor degree in Marine Director, Assistant Vice C.P. Sue 2008.11.01 12,146 0.0004 0 0 Engineering, National Taiwan Asia Cement (Singapore) President Ocean University Pte. Ltd. Bachelor degree in Business Director, Assistant Vice T.L. Yu 2009.09.01 35 0.0000 91 0 Administration, Yu Yuan Investment Co., - 18 President

18 University of the Philippines Ltd Bachelor degree in Director, Manager of IT Dept. T.W. Huang Fu 2004.09.01 18,235 0.0006 0 0 Accounting, Yu Yuan Investment Co., Chinese Culture University Ltd Bachelor degree in Manager of Supervisor, W.H. Yeh 2007.07.25 0 0 0 0 Accounting, Accounting Dept. Nan Hwa Cement Corp. Soochow University Director, Manager of Bachelor degree in Law, Manfred Wang 2008.09.01 0 0 0 0 Fu Shan Mineral Stone Secretarial Dept. Soochow University Co., Ltd Manager of Bachelor degree in Business Director, Domestic Sales M.C. Cheng 2008.11.01 0 0 0 0 Administration, Ya Li Transport Corp. Dept. Feng Chia University ＊There is no manager holding shares in the name of another person. ＊Managers are spouse or within second- degree of consanguinity to each other: None.

3.2.6 Remuneration of Directors, Supervisors, President, and Vice Presidents

1. Remuneration of Directors UNIT: NT＄ Remuneration of Directors Remuneration paid as the status of employee Total Amount Total Amount Directors Remuneration Employees bonus from (A+B+C+D+E (A+B+C+D)/Net Salary, Reward, and Is any Remuneration(A) severance pay(B) from Distributable Expense(D) Severance pay(F) Distributable +F+G)/ Income Expense etc.(E) remunera- Earnings(C) Earnings(G) Net Income (%) tion paid Title Name All from All All All All All ACC companies All All All other ACC ACC ACC companies ACC companies ACC companies ACC companies ACC companies * ACC companies companies* companies* investees? * * * * * Cash Cash * Bonus Bonus Chairman Douglas Tong Hsu Far Eastern New Century Corp. Representatives: Director T.H. Chang Director Johnny Shih Director C.V. Chen Director Chin-Der Ou X.Z.Ying-Chai

- 19 Memorial Foundation 19 Representative: Director H.S. Ying U-Ming Corp. Representative: Director Ta-Chou Huang 14,684,661 17,727,107 0 0 155,739,815 157,169,490 1,056,000 5,050,407 2.175% 2.282% 10,171,604 11,114,004 216,000 216,000 4,988,151 4,988,151 2.370% 2.489% Yes Yue Ding Industry

Co., Ltd.

Representative: Director

K.Y. Lee Report Corporate Governance Far Eastern Y.Z.Hsu Science Director and Technology Memorial Foundation Huey Kang Investment Corp. Representative: Director Connie Hsu Director K.T. Li Director Peter Hsu Director Kao Chao Lee ＊All Companies listed in Consolidated Operational Report. ＊Distribution of stock bonus from ACC and all companies listed in consolidated operational report: None. ＊T.H. Chang, director of the Company, is allocated for one official car. The monthly rental is NT$ 30,800, and the annual remuneration of driver is about NT$ 700,000. ＊K.Y. Lee, the president and director of the Company, is allocated for one official car. The monthly rental is NT$ 46,620, and the annual remuneration of driver is about NT$ 700,000. ＊Pensions funded according to applicable law.

Name of Directors

Classification of Remuneration A+B+C+D A+B+C+D+E+F+G Paid to ACC Directors (Please refer to listed information above ) (Please refer to listed information above ) All Companies listed in All Companies listed in ACC Consolidated Operational ACC Consolidated Operational Report Report C.V. Chen, C.V. Chen, C.V. Chen, C.V. Chen, H.S. Ying, H.S. Ying, H.S. Ying, H.S. Ying, K.T. Li, K.T. Li, K.T. Li, K.T. Li, Under NT$2,000,000 Chin-Der Ou, Chin-Der Ou, Chin-Der Ou, Chin-Der Ou, Kao Chao Lee, Kao Chao Lee, Kao Chao Lee, Kao Chao Lee, Ta-Chou Huang, Ta-Chou Huang, Ta-Chou Huang, Ta-Chou Huang, Connie Hsu Connie Hsu Connie Hsu Connie Hsu NT$2,000,000～NT$5,000,000 - 20

20 NT$5,000,000～NT$10,000,000 Peter Hsu Peter Hsu Peter Hsu Peter Hsu Johnny Shih, Johnny Shih, NT$10,000,000～NT$15,000,000 Johnny Shih Johnny Shih K.Y. Lee K.Y. Lee Douglas Tong Hsu, Douglas Tong Hsu, Douglas Tong Hsu, Douglas Tong Hsu, NT$15,000,000～NT$30,000,000 T.H. Chang, T.H. Chang T.H. Chang K.Y. Lee K.Y. Lee NT$30,000,000～NT$50,000,000 T.H. Chang NT$50,000,000～NT$100,000,000 Over NT$100,000,000 Total 12 12 12 12 ＊Employee stock option of ACC and all companies listed in consolidated operational report: None. ＊Within recent two fiscal years, all ACC directors’ remuneration accounted for 2.546%(for 2008) and 2.370%(for 2009) of ACC net income; total directors’ remuneration paid by all companies listed in consolidated operational report accounted for2.644%(for 2008) and 2.489% (for 2009)of net income complied by those companies. ＊The remuneration of ACC directors is paid in consideration of the Company’s operating performance and individual contribution. This principle has been recognized by all directors.

2. Remuneration of Supervisors UNIT: NT＄ Remuneration of Supervisors Supervisors Total Amount Is any Remuneration from (A+B+C+D)/Net remuneration Remuneration(A) Severance pay(B) Expense(D) Title Name Distributable Income(%) paid from Earnings(C) other All All All All All investees? ACC ACC ACC ACC ACC companies* companies* companies* companies* companies* Supervisor Far Eastern Medical Foundation Representative: S.Y. Wang Bai-Yang Investment Holdings Corp. Supervisor Representative: Champion Lee Kai-Yuan International Investment Holdings Corp. 0 0 0 0 46,519,685 46,519,685 408,000 484,042 0.595％ 0.596％ yes Supervisor Representative: L.T. Chang Supervisor T.Y. Tung Supervisor Eli C.Wang ＊All Companies listed in Consolidated Operational Report. - 21

21 Name of Supervisors Classification of Remuneration Paid to ACC Supervisors A+B+C+D (Please refer to listed information above ) ACC All Companies listed in Consolidated Operational Report Under NT$2,000,000 S.Y. Wang, L.T. Chang, Champion Lee, Eli C.Wang S.Y. Wang, L.T. Chang, Champion Lee, Eli C.Wang NT$2,000,000～NT$5,000,000 Corporate Governance Report Corporate Governance NT$5,000,000～NT$10,000,000 T.Y. Tung T.Y. Tung NT$10,000,000～NT$15,000,000 NT$15,000,000～NT$30,000,000 NT$30,000,000～NT$50,000,000 NT$50,000,000～NT$100,000,000 Over NT$100,000,000 Total 5 5 ＊There is no ACC supervisor receiving salary and other services paid by ACC and all companies listed in consolidated operational report. ＊Within recent two fiscal years, all ACC supervisors’ remuneration, of which the main are transportation allowance and remuneration from distributable earnings, accounted for 0.610%(for 2008) and 0.595% (for 2009) of ACC net income; total supervisors’ remuneration paid by all companies listed in consolidated operational report accounted for 0.622% (for 2008)and 0.596% (for 2009)of net income complied by those companies. ＊The remuneration of ACC supervisors is paid in consideration of the Company’s operating performance and individual contribution. This principle has been recognized by all supervisors.

3. Remuneration of President and Vice Presidents UNIT: NT＄ Total Amount Reward and Expense etc. Employees bonus from Salary(A) Severance pay(B) (A+B+C+D)/Net Is any (C) Distributable Earnings (D) Income(%) remuneration Title Name All paid from other All All All ACC All ACC ACC ACC companies* ACC investees? companies* companies* companies* companies* Cash Bonus Cash Bonus President K.Y. Lee Chief Executive Vice President Y.F. Chang Executive Vice President R.H. Shao Chief Auditor Y.M. Shih 21,058,740 22,138,740 756,000 756,000 9,486,230 15,302,375 13,855,366 13,855,366 0.573% 0.660% yes Vice President Doris Wu Vice President C.M. Chen Vice President W.K. Chou General Plant Manager Z.P. Chang * All Companies listed in Consolidated Operational Report. * Distribution of stock bonus from ACC and all companies listed in consolidated operational report: None. * Pensions funded according to applicable law.

- 22 22 Classification of Remuneration Paid to ACC President Name of President and Vice Presidents and Vice Presidents ACC All Companies listed in Consolidated Operational Report

Under NT$2,000,000

NT$2,000,000～NT$5,000,000 W.K. Chou W.K. Chou K.Y. Lee , Y.F. Chang, R.H. Shao, Y.M. Shih, Doris Wu, K.Y. Lee , Y.F. Chang, R.H. Shao, Y.M. Shih, Doris Wu, NT$5,000,000～NT$10,000,000 C.M. Chen, Z.P. Chang C.M. Chen, Z.P. Chang NT$10,000,000～NT$15,000,000 NT$15,000,000～NT$30,000,000 NT$30,000,000～NT$50,000,000 NT$50,000,000～NT$100,000,000 Over NT$100,000,000 Total 8 8 ＊Employee stock option of ACC and all companies listed in consolidated operational report: None. ＊Within recent two fiscal years, all ACC President and Vice Presidents’ remuneration accounted for 0.884% (for 2008)and 0.573% (for 2009) of ACC net income; total amount of President and Vice Presidents’ remuneration paid by all companies listed in consolidated operational report accounted for 0.983% (for 2008) and 0.660% (for 2009) of net income compiled by those companies. ＊The remuneration of ACC President and Vice Presidents is divided into two parts: 1. Monthly salary based on fixed salary rank. 2. Based on ACC’s bonus system, bonus and compensation are distributed mainly in consideration of the Company’s operating performance and individual annual performance. ＊The chief executive vice president of the Company, Y.F. Chang, is allocated for one official car. The monthly rental is NT＄25,500.

4. Employees Bonus of Management Team UNIT: NT＄ Title Name Stock Bonus Cash Bonus Total Amount Total Amount/Net Income（％） President K.Y. Lee Chief Executive Vice President Y.F. Chang Executive Vice President R.H. Shao Chief Auditor Y.M. Shih Vice President Doris Wu Vice President C.M. Chen Vice President W.K. Chou Executive General Plant Manager Z.P. Chang 0 22,875,218 22,875,218 0.290% Officers Manager of the Hsinchu Plant Z.F. Lin Assistant Vice President C.P. Sue Assistant Vice President T.L. Yu Manager of IT Dept. T.W. Huang Fu Manager of Accounting Dept. W.H. Yeh

- 23 Manager, President Office H.T. Peng

23 Manager of Secretarial Dept. Manfred Wang Manager of Domestic Sales Dept. M.C. Cheng Name and Title of the Top 10 Employees Who Were Distributed Employees Bonus UNIT: NT＄ Rank Title Name Stock Bonus Cash Bonus Total Amount

1 President K.Y. Lee Report Corporate Governance 2 Chief Executive Vice President Y.F. Chang 3 Executive Vice President R.H. Shao 4 Chief Auditor Y. M. Shih 5 Vice President C.M. Chen 0 16,588,554 16,588,554 6 Vice President Doris Wu 7 General Plant Manager Z.P. Chang 8 Vice President W.K. Chou 9 Manager of the Hsinchu Plant Z.F. Lin 10 Assistant Vice President C.P. Sue

3.3 Implementation of Corporate Governance 3.3.1 Board of Directors Total of 5 meetings of the board of directors were held in the period from Jan. 1, 2009 to April 30, 2010. Directors’ attendance condition was as follows:

Attendance Attendance rate Notes Title Name in Person By Proxy (%) Reappointment Chairman Douglas Tong Hsu 5 0 100% Jun.17, 2008 Reappointment Director T.H. Chang 4 1 80% Jun.17, 2008 Reappointment Director Johnny Shih 4 1 80% Jun.17, 2008 Reappointment Director C.V. Chen 3 2 60% Jun.17, 2008 Reappointment Director Chin-Der Ou 4 1 80% Jun.17, 2008 Reappointment Director H.S. Ying 5 0 100% Jun.17, 2008 Reappointment Director Ta-Chou Huang 5 0 100% Jun.17, 2008 Reappointment Director K.Y. Lee 5 0 100% Jun.17, 2008 Reappointment Director Peter Hsu 4 1 80% Jun.17, 2008 Reappointment Director K.T. Li 5 0 100% Jun.17, 2008 Reappointment Director Connie Hsu 4 0 80% Jun.17, 2008 Reappointment Director Kao Chao Lee 4 1 80% Jun.17, 2008 Other mentionable items: 1. There is no independent director in the Company. 2. If there is Directors’ avoidance of motions in conflict of interest, the Directors’ names, contents of motions, causes for avoidance and voting should be specified: Director Douglas Tong Hsu, Peter Hsu, Connie Hsu, and K.T. Li, who are the directors of the Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation, avoided the motion in conflict of interest about the donation to the said Memorial Foundation in the 7th meeting of 23rd Board. The donation has obtained the unanimous approval from all other directors. 3. Measures taken to strengthen the functionality of the Board: Goals: To deepen the understanding of the Board of Directors about the investment activities in China. Implementation Status: A. The CEO and CFO of Asia Cement (China) Holdings Corp. will make reports about the investments, productions, and financial activities in China. B. The Company will post any material information on MOPS on behalf of Asia Cement (China) Holdings Corp. and inform all Directors and Supervisors. Any investment which needs the approval from the Investment Commission, MOEA will be recognized by the Board of Directors. C. The Company will irregularly invite its Directors and Supervisors to visit its investments in China. Assessment: The above measures are made pursuant to laws, government regulations, or corporate government principals. These will strengthen the understanding of the Directors and Supervisors about the investment activities in China. 4. The training for Directors and Supervisors: Directors and Supervisors participate in corporate governance practice workshops to strengthen the functions of directors and supervisors. Please refer to page 28 for detail information. 5. No audit committee established.

Corporate Governance Report

3.3.2 Attendance of Supervisors for Board Meeting Total of 5 meetings of the board of directors were held in the period from Jan. 1, 2009 to April 30, 2010. Supervisors’ Attendance Condition was as follows: Attendance in Attendance rate Title Name Notes Person (%) Reappointment Supervisor S.Y. Wang 5 100% Jun.17, 2008 Reappointment Supervisor Champion Lee 5 100% Jun.17, 2008 Reappointment Supervisor L.T. Chang 2 40% Jun.17, 2008 Reappointment Supervisor T.Y. Tung 4 80% Jun.17, 2008 Reappointment Supervisor Eli C.Wang 5 100% Jun.17, 2008 Other mentionable items: 1.Organization and Responsibilities of Supervisors: A. Communications with company employees and shareholders: In ACC, the labor relation is harmonious, information is open, and communication channels among different functions and levels are unblocked. Therefore, there is no affair with which company employees and shareholders should communicate. B. Communications with internal audit manager and CPA: (1) Internal audit manager seasonally report audit business to Supervisors: a. The progress of meeting resolutions. b. The execution of audit works of current quarter. c. The plans of audit works of next quarter. (2) CPA and accounting manager report financial and operation business to supervisors every half year. (3) All supervisors attend meetings in person, except Supervisor, L.T. Chang, in Shanghai by video conference. 2. If supervisors make any statement in BOD meetings, the following information should be disclosed- the date of BOD, the term of BOD, the contents and resolutions of motions, and the follow-up of supervisors’ statements: In the recent fiscal year, Supervisors attended BOD meeting and occasionally participated in discussion. No opposition has been made by Supervisors to any motions and company policies.

3.3.3 Corporate Governance Execution Status and Deviations from “Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies” Deviations from “Corporate Governance Item Implementation Status Best-Practice Principles for TWSE/GTSM Listed Companies” and reasons 1.Shareholding Structure & Shareholders’ Rights (1)Method of handling The Company has appointed spokesman or his No Discrepancies. shareholder suggestions or deputy as well as its affiliated stock agency, Oriental complaints Security Corporation, to handle these issues. (2)The Company’s possession The Company keeps tracking the list of shareholders No Discrepancies. of a list of major and follows the Article 3 of Market Information shareholders and a list of Post Regulation Reporting by Listed Companies ultimate owners of these to post related information within one month after major shareholders the end of annual shareholders’ meetings of ACC’s major shareholders. (3)Risk management In addition to enacting “Regulations for Monitoring No Discrepancies. mechanism and “firewall” Subsidiaries” as the risk management mechanism between the Company and for its subsidiaries, the Company has also enacted its affiliates “Regulations for Managing Client’s Credit” and assigned the specific Credit Committee to be responsible for risk control of accounts receivable. Meanwhile, to establish risk management and firewall, we have signed up with affiliates for “Procedures of Assets Acquisition and Disposal”, “Procedures for Loaning of funds to Others”, “Procedures for Endorsement and Guarantee,” and “Rules on the Management of Related Party Transaction.” 2.Composition and Responsibilities of the Board of Directors (1)Independent Directors The Company has no independent directors. The independent directors will be set up upon the requirement of law. The directors and supervisors elected by the Company are the trust worthy persons. Their excellent backgrounds and experiences of independent directors and supervisors enable them to fulfill the mission of supervising the Company’s operation. (2)Regular evaluation of CPAs’ To regularly make sure the independence of Certified No Discrepancies. independence Public Account (CPA), the Company requires CPA to attend meetings of BOD and make the auditing report.

Corporate Governance Report

Deviations from “Corporate Governance Item Implementation Status Best-Practice Principles for TWSE/GTSM Listed Companies” and reasons 3.Communication channel with All proposals or inquiries from interest-conflicting No Discrepancies. stakeholders parties shall be well conducted by spokesman of the Company or his deputy as well as its affiliated stock agency, Oriental Security Corporation. 4.Information Disclosure (1)Establishment of a corporate Please refer the Company’s website at: No Discrepancies. website to disclose http://www.acc.com.tw information regarding the Company’s financials, business and corporate governance status (2)Other information disclosure The Company has spokesperson, deputy No Discrepancies. channels (e.g., maintaining spokesperson and appoints specific person an English-language regularly disclose relevant information as website, appointing required. responsible people to handle information collection and The Company will convene the institutional disclosure, appointing investors’ conference upon request and post spokespersons, webcasting relevant information on MOPS and ACC website. investors conference) 5.Operations of the Company’s The Company has not yet set up such committees. Such committees will be Nomination Committee, set up upon the requirement Compensation Committee, or of law. other committees of the Board of Directors 6. If the Company has established corporate governance principles based on “Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies”, please describe any discrepancy between the principles and their implementation: The Company has no specific chapter stipulating corporate governance principles based on “Corporate Governance Best-Practice Principles for TWSE/GTSM Listed Companies”. Relevant regulations have been applied explicitly in the context of the Company’s rules and bylaws. 7. Other important information to facilitate better understanding of the Company’s corporate governance practices (e.g., employee rights, employee wellness, investor relations, supplier relations, rights of stakeholders, directors’ and supervisors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors): (1) Status of employee rights and employee wellness: Please refer to the “Labor Relation” section on page 61-64 of this Annual Report. (2) Investor Relations: ACC shareholders can access to present operation and future development of the Company by regular Shareholders’ meeting, and get important information through company website and Market Observation Post System. If shareholders have questions, the answers will be offered through spokesman system and the agent for stock affair, Oriental Securities Corporation. For many years, the excellent performance of the Company can meet investors’ expectation.

Deviations from “Corporate Governance Item Implementation Status Best-Practice Principles for TWSE/GTSM Listed Companies” and reasons (3) Supplier relations: The Company regards our suppliers as partners. Except requiring good service, high quality, and reasonable prices to our suppliers, the Company also brings our construction contractors into PDCA Cycle in the safety management system, and set up safety regulations for contractors, such as access control and issuing construction permission, and holds training courses to help contractors fulfill safety requirements. (4) The training for directors and supervisors: All of our directors and supervisors proactively participate in training courses. On 2009/7/2, the training center of Far Eastern New Century Corp. of the Far Eastern Group has arranged ACC directors and supervisors to attend ‘Practice of Board of Directors” and “Study of Corporate Governance” (3 hours) held by Taiwan Academy of Banking and Finance. (5) Responsibility insurance purchase for directors and supervisors: None. 8. If the Company has implemented a self corporate governance evaluation or has authorized any other professional organization to conduct such an evaluation, the evaluation results, major deficiencies or suggestions, and improvements are stated as follows: None

◎Corporate social responsibility: ACC’s achievement to environment protection, neighbor communities, social welfare, human rights, and other social activities: Please refer to page 59-61, “Expenditures on Environmental Protection” for detail information about: 1. ISO-14001 environment management system. 2. Air pollution prevention. 3. Greening & Beautification for quarry restoration. 4. Major items of future environmental protection work. 5. Fulfill social responsibilities. ◎Consumers’ rights: To protect consumers’ rights, the Company sets up consumer services to manage consumers’ complaints from domestic and oversea clients. The Hsinchu and Hualien plants will manage our product quality to meet out customer’s need. ◎Access to Corporate Governance Best-Practice Principles and relevant regulations: None. ◎Any other important information to facilitate better understanding of the Company’s corporate governance practices: None. ◎During the most recent fiscal year and the current fiscal year up to the date of printing of this annual report, any punishment occurred for the Company and its employees violating laws, and any punishment, fault and improvement occurred for the Company’s employees against the regulations of Internal Audit System: None. ◎To appoint certified accountants to audit internal audit system: None. ◎The training for managers: All managers are required to participate in training courses held by the Company and relevant institutions. All ACC managers attended “The Study of Corporate Governance” held by Taiwan Academy of Banking and Finance for three hours on July 2, 2009.

Corporate Governance Report

3.3.4 The Execution Status of Internal Control System

Asia Cement Corporation Statement of Internal Control System Date: March 22, 2010 Asia Cement Corporation(ACC) has conducted a self-inspection of internal control system during 2009. The results are as follows: ACC acknowledges that the implementation and maintenance of internal control system is the responsibility of Board of Directors and managerial level, and ACC has established such system. It is aimed to reasonably ensure that the goals such as effective and efficient operations (including profitability, performance, and safeguard of assets), the reliability of financial reports, and the compliance with applicable laws and regulations are achieved. The internal control system has its inherent limitations; whatever a perfect design is, an internal control system can provide only reasonable assurance that the above-mentioned goals will be achieved; besides, owing to the change of environment and circumstances, the effectiveness of internal control system will be changed accordingly. However, the internal control system of ACC is equipped with self-monitoring mechanisms and ACC will take corrective action once defect is identified. According to the criteria for the internal control system as specified in “Guidelines for Implementation of Establishing Internal Control System by Public Listed Companies”(hereinafter referred to as “Guidelines,”) ACC evaluates the effectiveness of its internal control system. The said Guidelines divide internal control system into five components: (1) Control Environment, (2) Risk Assessment and Responses, (3) Control Operations, (4) Information and Communication, and (5) Monitoring. Each component includes certain items. For the foregoing items, please refer to “Guidelines”. ACC has adopted the aforesaid criteria for internal control system to evaluate the effectiveness of design and implementation of internal control system. Based on the findings of the evaluation mentioned in the preceding paragraph, ACC believes that as at December 31, 2009 its internal control system (including its supervision of subsidiaries), encompassing internal controls for knowledge of the degree of achievement of operational effectiveness and efficiency objectives, reliability of financial reporting, and compliance with applicable laws and regulations, was effectively designed and operating, and reasonably assured the achievement of the above-stated objectives. This statement comprises the entire annual report and public brochure, and will be publicly disclosed. If the aforesaid statement has any unlawful attempt such as pretence and concealment, ACC will assume the legal responsibilities according to Article 20, 32, 171 and 174 of Securities and Exchange Law. This statement has been approved by ACC Board of Directors at the meeting of March 22, 2010 with 12 directors in presence and none disagreement with the content of this statement.

Asia Cement Corporation Chairman: Douglas Tong Hsu President: K.Y. Lee

3.3.5 Major Resolutions of Shareholders’ Meeting and Board Meetings

1. Major resolution of 2009 Regular Shareholders’ Meeting Date Major resolutions 1. Acceptance of 2008 financial statements. 2. Acceptance of the proposal for distribution of 2008 profits. 2009/06/09 3. Acceptance for a new share issue through capitalization of earnings. 4. Amendment to the Procedures for Loaning of Fund to Others. 5. Amendment to the Procedures for Endorsement & Guarantee. 1. Major resolutions of the Shareholders’ meeting have been fully implemented. 2. The record date for distribution of 2008 profits was August 30, 2009. Cash dividends have been distributed on September 29, 2009. Execution 3. The new share issue through capitalization of earnings has been proved by the Status Financial Supervisory Commission on July 14, 2009. 4. Amendment to the Procedures for Loaning of Fund to Others and the Procedures for Endorsement & Guarantee has been post on the Market Observation Post System.

2. Major Resolutions of the Board of Directors Directors and Supervisors have no opposition to major resolutions in the year of 2009 and up to April 30, 2010. Item Date Major resolutions 1. Acceptance of 2008 financial report. 2. Acceptance of 2008 consolidated financial report. 3. Acceptance of the distribution of 2008 profits.

th 4. Acceptance of new share issue through capitalization of 2008 4 Meeting earnings. of 23rd 2009/03/25 5. Acceptance of 2009 CPA service fee of Deloitte & Touche. Board of 6. Acceptance of the date and relevant issues of 2009 Regular Director Shareholders’ Meeting. 7. Acceptance of the amendment to the Procedures for Loaning of Fund to Others and the Procedures for Endorsement & Guarantee. 8. Acceptance to issue 2008 Statement of Internal Control System. 5th Meeting 1. To decide the ex-dividend date for distribution of cash dividends, the of 23rd ex-right date for capital increase, and the closing date for stock 2009/07/29 Board of transference. Director 2. Amendment to the Rules to Authorize Duties. 1. Acceptance of the 2009 semi-annual financial statements. 2. Acceptance of the 2009 consolidated semi-annual financial statements. 6th Meeting 3. Acceptance of Cross Currency Swap Deal (US$80 million) with Far of 23rd 2009/08/28 Eastern International Bank. Board of 4. Amendment to “Internal Control System” and “Internal Auditing Director System & Relevant Rules.” 5. Acceptance of the donation of NT$12 million to the Morak post-disaster reconstruction.

Corporate Governance Report

Item Date Major resolutions 1. Acceptance of 2010 business budget. 2. Acceptance of 2010 capital expenditure budget. 3. Acceptance of 2010 audit plan. 4. Acceptance to issue unsecured ordinary corporate bond in once or separately, the total amount not exceeding NT$5 billion. 5. Acceptance of “the Procedure Dealing with Internal Material 7th Meeting Information.” of 23rd 2009/12/21 6. Amendment to “Internal Control System” and “Internal Auditing Board of System & Relevant Rules.” Director 7. Acceptance of authorizing the Finance Vice President to review the assessment reports about the derivative deal of Cross Currency Swap (US$ 80 million) with Far Eastern International Bank in compliance with government regulations. 8. Acceptance of the donation of NT$ 90,000,000 to Far Eastern Y.Z. Hsu Science and Technology Memorial Foundation. 1. Acceptance of 2009 financial statements. 2. Acceptance of 2009 consolidated financial statements. 3. Acceptance of the proposal for distribution of 2009 profits. 4. Acceptance of the proposal for a new share issue through capitalization of earnings. 5. Acceptance of 2010 CPA service fee of Deloitte & Touche. 6. Acceptance to increase capital expenditure budget for installation of 8th Meeting packing facilities in Keelung Station. of 23rd 2010/03/22 7. Acceptance of the date and relevant issues of 2010 Regular Board of Shareholders’ Meeting. Director 8. Acceptance to apply unsecured commercial paper for five-year, amounted NTD$ 1 billion, to Mega Bills Finance Co., LTD to strengthen middle and long term working capitals and financial structure. 9. Acceptance to issue 2009 Statement of Internal Control System. 10. Acceptance of the amendment to the Procedures for Loaning of Fund to Others and the Procedures for Endorsement & Guarantee.

◎In the most recent fiscal year or during the current fiscal year up to the printing date of the annual report, there are no persons with responsibility of financial statements (including chairman, president, accounting supervisor, and audit supervisor, etc.) taking resignation or being laid off.

◎The Board of Director approved “the Procedure Dealing with Internal Material Information of Asia Cement Corporation” on December 21, 2009. This Procedure has been posted on the Company’s electronic bulletin board.

3.4 Information of CPA Service Fee 1. Information of CPA service fee

Auditing Name of Accounting Firm Name of Accountant Note period

Deloitte & Touche. Hsin Wei Tai You Wei Fan 2009 -

Unit: NT$ Item Service fee Non auditing fee Total Bracket Under NT$2,000 thousands V 176,000 NT$2,000 thousands～4,000 thousands NT$4,000 thousands～6,000 thousands NT$6,000 thousands～8,000 thousands V 7,839,000 NT$8,000 thousands～10,000 thousands Over NT$10,000 thousands

2. Change of CPA in recent two fiscal years and subsequent periods: The Company originally commissioned Accountant Hsin Wei Tai and Li Wen Kuo of Deloitte & Touche- Taiwan to audit the financial statements. Due to function adjustments in Deloitte & Touche- Taiwan, since the first half of 2008 the audit has been commissioned to Accountant Hsin Wei Tai and You Wei Fan.

3. The ACC Chairman, President, and managers who are responsible for finance and accounting do not have any position at CPA Firm or its affiliated companies in the most recent fiscal year.

4. Relevant licenses and certificates obtained about transparent financial information:

Department Name Title Licenses and Certificates Finance Doris Wu Vice President CPA, Taiwan and United States Finance Yu Ling Yang Project Manager CPA, Taiwan Accounting Jian Wei Chiou Accounting Personnel CPA, Taiwan Accounting Tsung Min Sung Accounting Personnel Certified Internal Auditor Auditing Chi Wen Lu Superintendent Certified Internal Auditor

3.5 Changes in Shareholding of Directors, Supervisors, Managers and Major Shareholders Shareholdings Held as of Net change in Shareholdings Held as of Net change in Shareholdings Held as of Jan. 1, 2009 Shareholding Dec. 31, 2009 Shareholding Apr. 10, 2010 Shares Shares Shares Shares Title Name Held Pledged Held Pledged Shares Shares Holding Pledged Shares Shares Holding Pledged Shares Shares % % % Held Pledged shares shares Held Pledged shares shares Held Pledged Increase Increase Increase Increase (Decrease) (Decrease) (Decrease) (Decrease) Chairman Douglas Tong Hsu 20,074,271 0.69% 0 602,228 0 20,676,499 0.69% 0 0 0 20,676,499 0.69% 0 Far Eastern New Century 697,216,230 24.05% 22,288,000 (30,583,514) 0 666,632,716 22.33% 22,288,000 0 0 666,632,716 22.33% 22,288,000 Corp. Representative: Johnny Shih 693,119 0.02% 0 20,793 0 713,912 0.02% 0 0 0 713,912 0.02% 0 Director Representative: T.H. Chang 396,127 0.01% 0 11,883 0 408,010 0.01% 0 0 0 408,010 0.01% 0 Representative: C.V. Chen 291,850 0.01% 0 8,755 0 300,605 0.01% 0 0 0 300,605 0.01% 0 Representative: Jin-Der Ou 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 U-Ming Corp. 1,298,356 0.04% 0 38,950 0 1,337,306 0.04% 0 0 0 1,337,306 0.04% 0 Director Representative: Ta-Chou 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Huang X.Z. Ying-Chai Memorial 11,404,127 0.39% 0 342,123 0 11,746,250 0.39% 0 0 0 11,746,250 0.39% 0 Director Foundation - 33 Representative: H.S. Ying 9,234,869 0.32% 0 277,046 0 9,511,915 0.32% 0 0 0 9,511,915 0.32% 0 33 Far Eastern Y.Z. Hsu Director Science and Technology 2,885,416 0.10% 0 644,822 0 3,530,238 0.12% 0 0 0 3,530,238 0.12% 0 Memorial Foundation Yue Ding Industry Co., Ltd. 635,290 0.02% 0 1,048,028 0 1,683,318 0.06% 0 0 0 1,683,318 0.06% 0 Director Representative: K.Y. Lee 2,036,510 0.07% 0 61,095 0 2,097,605 0.07% 0 0 0 2,097,605 0.07% 0 Director Peter Hsu 7,910,602 0.27% 0 709,058 0 8,619,660 0.29% 0 0 0 8,619,660 0.29% 0 Huey Kang Investment 4,171,606 0.14% 0 125,148 0 4,296,754 0.14% 0 0 0 4,296,754 0.14% 0 Director Corp. Report Corporate Governance Representative: Connie Hsu 12,301,316 0.42% 0 369,039 0 12,670,355 0.42% 0 0 0 12,670,355 0.42% 0 Director K.T. Li 554,443 0.02% 0 16,633 0 571,076 0.02% 0 0 0 571,076 0.02% 0 Director Kao Chao Lee 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Bai-Yang Investment 3,319,625 0.11% 0 99,588 0 3,419,213 0.11% 0 0 0 3,419,213 0.11% 0 Holdings Corp. Supervisor Representative: Champion 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Lee Far Eastern Medical 156,575,660 5.40% 24,500,000 4,697,269 0 161,272,929 5.40% 24,500,000 0 0 161,272,929 5.40% 24,500,000 Supervisor Foundation Representative: S.Y. Wang 133,529 0.00% 0 4,005 0 137,534 0.00% 0 0 0 137,534 0.00% 0 Kai-Yuan International 11,045,552 0.38% 0 331,366 0 11,376,918 0.38% 0 4,250,000 0 15,626,918 0.52% 0 Supervisor Investment Holdings Corp. Representative: L.T. Chang 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Supervisor T.Y. Tung 3,461,413 0.12% 3,320,000 103,842 0 3,565,255 0.12% 3,320,000 0 0 3,565,255 0.12% 3,320,000 Supervisor Eli C. Wang 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 President K.Y. Lee 2,036,510 0.07% 0 61,095 0 2,097,605 0.07% 0 0 0 2,097,605 0.07% 0

Shareholdings Held as of Net change in Shareholdings Held as of Net change in Shareholdings Held as of Jan. 1, 2009 Shareholding Dec. 31, 2009 Shareholding Apr. 10, 2010 Shares Shares Shares Shares Title Name Held Pledged Held Pledged Shares Shares Holding Pledged Shares Shares Holding Pledged Shares Shares % % % Held Pledged shares shares Held Pledged shares shares Held Pledged Increase Increase Increase Increase (Decrease) (Decrease) (Decrease) (Decrease) Chief Executive Y.F. Chang 703 0.00% 0 21 0 724 0.00% 0 0 0 724 0.00% 0 Vice President Executive Vice R.H. Shao 66,069 0.00% 0 1,982 0 68,051 0.00% 0 0 0 68,051 0.00% 0 President Chief Y.M. Shih 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Auditor Vice Doris Wu 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 President Vice C.M. Chen 34,325 0.00% 0 1,029 0 35,354 0.00% 0 0 0 35,354 0.00% 0 President Vice - 34 W.K. Chou 4,282 0.00% 0 128 0 4,410 0.00% 0 0 0 4,410 0.00% 0 President 34 General Plant Z.P. Chang 29,322 0.00% 0 879 0 30,201 0.00% 0 0 0 30,201 0.00% 0 Manager Manager of the Hsinchu Z.F. Lin 8,531 0.00% 0 255 0 8,786 0.00% 0 0 0 8,786 0.00% 0 Plant Assistant Vice C.P. Su 11,793 0.00% 0 353 0 12,146 0.00% 0 0 0 12,146 0.00% 0 President Assistant Vice T.L. Yu 34 0.00% 0 1 0 35 0.00% 0 0 0 35 0.00% 0 President Manager W.H. Yeh 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Manager T.W. Huang Fu 17,704 0.00% 0 531 0 18,235 0.00% 0 0 0 18,235 0.00% 0 Manager H.T. Peng 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Manager Manfred Wang 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Manager M.C. Chen 0 0.00% 0 0 0 0 0.00% 0 0 0 0 0.00% 0 Major Far Easton New Century 697,216,230 24.05% 22,288,000 (30,583,514) 0 666,632,716 22.33% 22,288,000 0 0 666,632,716 22.33% 22,288,000 shareholder Corp.

Capital in the beginning of 2009: 2,898,772,314 shares. Capital in the end of 2009: 2,985,735,483 shares.

3.6 Information Disclosing the Relationship between any of the Company’s Top 10 Shareholders

Eastern New Century Corporation Report Corporate Governance 0 0% 0 0% Yu Chang Investment Co., Ltd. Non-related party 00%00% Labor Pension Fund Supervisory Non-related party Committee of Asia Cement Corporation 0 0% 0 0% Far Eastern New Century Corporation Non-related party 0 0% 0 0% Far Eastern Medical Foundation Non-related party 00%00% Management Board of the Public Service Non-related party Pension Fund 0 0% 0 0% Far Eastern Department Stores Co., Ltd. Non-related party 0 0% 0 0% Bai Ding Investment Co., Ltd. Non-related party Yu Yuan Investment Co., Ltd 158,708,305 5.32% 0 0% 0 0% Yuan-Ze University Non-related party 00%00% Labor Pension Fund Committee of Far Non-related party Eastern New Century Corporation 0 0% 0 0% Yu Chang Investment Co., Ltd. Non-related party 00%00% Labor Pension Fund Supervisory Non-related party Committee of Asia Cement Corporation

Shares of Total Shareholding The name and relation of top10 shareholders who mutually have Shares Held Spouse & Held In The Name relations that meet the definition of the “affiliate” in Financial Name Minor of Others Accounting Principle Article No.6 Shares % Shares % Shares % Name Relation 0 0% 0 0% Far Eastern New Century Corporation Non-related party 0 0% 0 0% Far Eastern Medical Foundation Non-related party 0 0% 0 0% Yu Yuan Investment Co., Ltd Non-related party 0 0% 0 0% Far Eastern Department Stores Co., Ltd. Non-related party 0 0% 0 0% Bai Ding Investment Co., Ltd. Non-related party Management Board of the 55,572,366 1.86% Public Service Pension Fund 0 0% 0 0% Yuan-Ze University Non-related party Labor Pension Fund Committee of Far 00%00% Eastern New Century Corporation Non-related party 0 0% 0 0% Yu Chang Investment Co., Ltd. Non-related party Labor Pension Fund Supervisory 00%00% Committee of Asia Cement Corporation Non-related party 0 0% 0 0% Far Eastern New Century Corporation The Same Chairman 0 0% 0 0% Far Eastern Medical Foundation The Same Chairman 0 0% 0 0% Yu Yuan Investment Co., Ltd Non-related party - 36 Management Board of the Public Service 36 00%00% Non-related party Pension Fund Far Eastern Department Stores 54,376,594 1.82% 00%00% Bai Ding Investment Co., Ltd. The Same Chairman Co., Ltd. 00%00% Yuan-Ze University The Same Chairman Labor Pension Fund Committee of Far 00%00% Non-related party Eastern New Century Corporation 00%00% Yu Chang Investment Co., Ltd. Non-related party Labor Pension Fund Supervisory 00%00% Non-related party Committee of Asia Cement Corporation 00%00% Far Eastern New Century Corporation The Same Chairman 00%00% Far Eastern Medical Foundation The Same Chairman 00%00% Yu Yuan Investment Co., Ltd Non-related party Management Board of the Public Service 00%00% Non-related party Pension Fund 00%00% Far Eastern Department Stores Co., Ltd. The Same Chairman Bai Ding Investment Co., Ltd 48,089,052 1.61% 00%00% Yuan-Ze University The Same Chairman Labor Pension Fund Committee of Far 00%00% Non-related party Eastern New Century Corporation 00%00% Yu Chang Investment Co., Ltd. Non-related party Labor Pension Fund Supervisory 00%00% Non-related party Committee of Asia Cement Corporation

Shares of Total Shareholding The name and relation of top10 shareholders who mutually have Shares Held Spouse & Held In The Name relations that meet the definition of the “affiliate” in Financial Name Minor of Others Accounting Principle Article No.6 Shares % Shares % Shares % Name Relation 00%00% Far Eastern New Century Corporation The Same Chairman 00%00% Far Eastern Medical Foundation The Same Chairman 00%00% Yu Yuan Investment Co., Ltd Non-related party Management Board of the Public Service 00%00% Non-related party Pension Fund 00%00% Far Eastern Department Stores Co., Ltd. The Same Chairman Yuan-Ze University 42,190,502 1.41% 00%00% Bai Ding Investment Co., Ltd. The Same Chairman Labor Pension Fund Committee of Far 00%00% Non-related party Eastern New Century Corporation 00%00% Yu Chang Investment Co., Ltd. Non-related party Labor Pension Fund Supervisory 00%00% Non-related party Committee of Asia Cement Corporation 00%00% Far Eastern New Century Corporation Non-related party 00%00% Far Eastern Medical Foundation Non-related party - 37 00%00% Yu Yuan Investment Co., Ltd Non-related party 37 Management Board of the Public Service 00%00% Non-related party Labor Pension Fund Committee Pension Fund of Far Eastern New Century 33,608,167 1.13% 00%00% Far Eastern Department Stores Co., Ltd. Non-related party Corp. 00%00% Bai Ding Investment Co., Ltd. Non-related party 00%00% Yuan-Ze University Non-related party 00%00% Yu Chang Investment Co., Ltd. Non-related party Corporate Governance Report Corporate Governance Labor Pension Fund Supervisory 00%00% Non-related party Committee of Asia Cement Corporation 00%00% Far Eastern New Century Corporation Non-related party 00%00% Far Eastern Medical Foundation Non-related party 00%00% Yu Yuan Investment Co., Ltd Non-related party Management Board of the Public Service 00%00% Non-related party Pension Fund Yu Chang Investment Co., Ltd. 31,172,894 1.04% 00%00% Far Eastern Department Stores Co., Ltd. Non-related party 00%00% Bai Ding Investment Co., Ltd. Non-related party 00%00% Yuan-Ze University Non-related party Labor Pension Fund Committee of Far 00%00% Non-related party Eastern New Century Corporation Labor Pension Fund Supervisory 00%00% Committee of Asia Cement Corporation Non-related party

Corporate Governance Report

3.7 Shareholding Proportion of ACC to Investees Dec. 31, 2009 Directly/Indirectly Investment by Directors, Investees Investment by ACC Total Investment Supervisors, and （Long-Term Investments） Management Shares % Shares % Shares % Asia Investment Corp. 118,145,000 100.00% - 0.00% 118,145,000 100.00% Sunrise Industrial Holdings Ltd. 90,000 100.00% - 0.00% 90,000 100.00% Ya Tung Ready-Mixed Concrete 119,382,860 99.99% 1,075 0.01% 119,383,935 100.00% Corp. Der Ching Investment Corp. 520,069,685 99.99% 11,596 0.00% 520,081,281 99.99% Nan Hwa Cement Corp. 26,132,827 99.96% 7,224 0.02% 26,140,051 99.98% Asia Cement (Singapore) Pte. 10,495,495 99.96% 2 0.00% 10,495,497 99.96% Ltd. Fu Ming Transportation Co., Ltd. 29,518,518 99.83% 3,724 0.00% 29,522,242 99.83% Asia Engineering Enterprise Pte. 6,630,831 98.06% 49,289 0.73% 6,680,120 98.79% Ltd. Far Eastern Pacific Development 50,000,000 25.00% 70.00% 190,000,000 95.00% Corp. 140,000,000 Yuan Ding Corp. 178,707,648 35.50% 259,917,920 51.63% 438,625,568 87.13% Ya Li Precast Prestressed 16,241,083 83.81% 14,366 0.08% 16,255,449 83.89% Concrete Industries Corp.. Asia Cement (China) Holdings 1,061,209,202 68.19% 63,853,798 4.10% 1,125,063,000 72.29% Co. Chiahui Power Corp. 280,093,521 59.59% 1,256,388 0.27% 281,349,909 59.86% Yuan Long Stainless Steel Corp. 102,000,000 51.00% - 0.00% 102,000,000 51.00% Ya Li Transport Corp. 4,939,183 49.39% 47,181 0.47% 4,986,364 49.86% Yuan Ding Lease Corp. 34,640,189 43.60% - 0.00% 34,640,189 43.60% Da Qiang Steel Corp. 3,300,000 41.67% - 0.00% 3,300,000 41.67% U-Ming Marine Transport Corp. 331,701,152 38.66% 14,104,041 1.64% 345,805,193 40.30% Oriental Securities Co.Ltd. 135,092,154 18.93% 140,971,013 19.75% 276,063,167 38.68% Ding Ding Plaza Hotel 3,891,637 13.73% 6,882,348 24.27% 10,773,985 38.00% Yu-Yuan Investment Corp. 179,587,463 36.42% 2 0.00% 179,587,465 36.42% Far Eastern New Century Corp. 1,107,915,325 23.77% 366,273,447 7.86% 1,474,188,772 31.63% Far Eastern Department Stores 67,433,685 5.56% 229,227,396 18.91% 296,661,081 24.47% Co.,Ltd. Oriental Union Chemical Corp. 57,969,566 7.20% 126,584,891 15.72% 184,554,457 22.92% Far Eastern International Bank 54,140,128 2.80% 347,545,348 17.97% 401,685,476 20.77% China Hi-ment Corp. 20,728,350 9.17% 4,375,013 1.94% 25,103,363 11.11% Kaohsiung Mass Rapid Transit 40,000,000 4.00% - 0.00% 40,000,000 4.00% Pan Asia Corp. 1,184,356 1.36% - 0.00% 1,184,356 1.36% Taiwan Stock Exchange Corp. 6,589,714 1.16% - 0.00% 6,589,714 1.16% Chung Hua Trade Development 250,003 0.38% - 0.00% 250,003 0.38% Corp. Chinatrust Hotels Ltd. 355,296 0.37% - 0.00% 355,296 0.37%

IV. CAPITAL FORMATION

4.1 Capital and Shares 4.1.1 Capital Authorized Capital Reserve for Convertible Share Type Issued Shares Un-issued Shares Total Shares Shares 2,985,735,483 Common Shares Available for trading on 314,264,517 3,300,000,000 100,000,000 the TSE

4.1.2 Capital Increase in the Past Five Years As of April 15, 2010 Authorized Capital Paid-in Capital Remarks Capital Par Increased Date Amount Amount Sources of Value Shares Shares by Assets Others (NT$) (NT$) Capital Other than Cash Dec.2005 NT$10 2,600,000,000 26,000,000,000 2,344,556,639 23,445,566,390 Dividend None None Dec.2006 NT$10 3,000,000,000 30,000,000,000 2,532,121,170 25,321,211,700 Dividend None None Dec.2007 NT$10 3,000,000,000 30,000,000,000 2,734,690,863 27,346,908,630 Dividend None None Dec.2008 NT$10 3,300,000,000 33,000,000,000 2,898,772,314 28,987,723,140 Dividend None None Dec.2009 NT$10 3,300,000,000 33,000,000,000 2,985,735,483 29,857,354,830 Dividend None None

4.1.3 Shareholder Structure As of April 15, 2010 Foreign Other Domestic Structure Financial Institutions Governments Institutional Individual Total Amount Institutions & Investors Investors Individuals Number of Shareholders 16 67 331 82,572 420 83,406 Number of shares 117,485,048 141,113,121 1,500,298,297 678,219,493 548,619,524 2,985,735,483 Shareholding Percentage 3.93% 4.73% 50.25% 22.72% 18.37% 100.00%

Capital Formation

4.1.4 Shareholding Distribution Status As of April 15, 2010 Class of Shareholding Number of shareholders Number of shares Holding Percentage (Unit: Share) 1-999 33,659 9,317,893 0.31% 1,000-5,000 31,642 72,517,776 2.44% 5,001-10,000 8,000 58,707,185 1.97% 10,001-15,000 3,207 37,959,856 1.27% 15,001-20,000 1,683 29,893,562 1.00% 20,001-30,000 1,716 41,646,374 1.39% 30,001-40,000 797 27,646,761 0.93% 40,001-50,000 563 25,427,217 0.85% 50,001-100,000 1,010 70,589,367 2.36% 100,001-200,000 506 70,157,323 2.35% 200,001-400,000 253 70,219,195 2.35% 400,001-600,000 79 38,684,946 1.30% 600,001-800,000 42 29,284,492 0.98% 800,001-1,000,000 29 25,729,860 0.86% More than 1,000,001 220 2,377,953,676 79.64% Total 83,406 2,985,735,483 100.00%

4.1.5 List of Major Shareholders Shares Number of Shares Holding Percentage Shareholders Far Eastern New Century Corporation 666,632,716 22.33% Far Eastern Medical Foundation 161,272,929 5.40% Yu Yuan Investment Co., Ltd 158,708,305 5.32% Management Board of the Public Service 55,572,366 1.86% Pension Fund Far Eastern Department Stores Co., Ltd. 54,376,594 1.82% Bai Ding Investment Co., Ltd. 48,089,052 1.61% Yuan-Ze University 42,190,502 1.41% Labor Pension Fund Committee of Far Eastern New 33,608,167 1.13% Century Corp. Yu Chang Investment Co., Ltd. 31,172,894 1.04% Labor Pension Fund Supervisory Committee of Asia 27,505,331 0.92% Cement Corporation Total 1,279,128,856 42.84%

4.1.6 Market Price, Net Value, Earnings and Dividends per Share (2008~2010/4/30) UNIT: NT$ YEAR Up to 2008 2009 ITEM April 30,2010 Highest 61.30 39.00 36.10 Market Price Lowest 16.20 23.05 27.35 Per Share Average 41.52 33.45 31.25 Net Value Before Distribution 22.37 25.15 24.91(Note1) Per Share After Distribution 20.57 (Note2) (Note2) Earnings Weighted Average Shares 2,816,731,589 2,942,253,899 2,985,735,483 Per Share Earnings Per Share 2.45 2.64 0.54 (Note1) Cash Dividends 2.40 1.80 1.80 (Note2) Dividends from 0.60 0.30 0.30 (Note2) Dividends Stock Retained Earnings Per Share Dividend Dividends from - - - Capital Surplus Accumulated Unpaid Dividends - - - Price-Earnings Ratio 16.95 12.67 - Return on Price-Dividend Ratio 17.30 18.58 - Investment Cash Dividend Yield 5.78% 5.38% -

Note 1: The data is adopted from the financial report of the first quarter in 2010 which was reviewed by the CPA. Note 2: Dividend distribution shall be resolved by the 2010 Shareholders’ Meeting. Note 3: After adjusting stock dividends, the highest, lowest and average market price of 2009 and 2008 are 37.9, 22.4, 32.9 and 57.8, 16.2, 39.8 respectively.

4.1.7 Dividend Policy & Implementation Status 1. Dividend Policy While mapping out our dividend distribution program in accordance with the Article of Incorporation, we will consider the business cycle, capital demands and taxation to maintain a stable dividend distribution scheme. The cash dividend will not be less than 10 percent of the stock dividend or stockholders' bonuses of that fiscal year. 2. The Dividend Distribution Proposal: (1) Cash dividend: NT$1.8 per share (total amount will be NT$ 5,374,323,873.) (2) Stock dividend: NT$0.3 per share (total amount will be NT$ 895,720,640.)

Capital Formation

4.1.8 The Impact of Dividend Distribution to be Resolved by 2010 Shareholders’ Meeting on Operating Performance UNIT: NT$ Year 2010 Estimate Item Paid-in Capital (beginning of the year) 29,857,354,830 Stock & Cash Cash Dividend (NT$ per share) 1.80 Dividend Stock Dividend from Retained Earnings 0.03 Distribution Stock Dividend from Capital Surplus 0.00 Operating Income not applicable* % Change in Operating Income 〃 Net Income 〃 Variance in % Change in Net Income 〃 Business Performance Earnings Per Share 〃 % Change in EPS 〃 Average Return on Investment (%) 〃 (Reciprocal of Average P/E Ratio) If Retained Earnings Pro Forma Earnings Per Share 〃 Distributed in Cash Pro Forma Average Yearly Return on 〃 Dividend Investment If Capital Surplus not Pro Forma Earnings Per Share 〃 Distributed in Stock Pro Forma Average Yearly Return on Pro Forma EPS & 〃 Dividend P/E Ratio Investment If Retained Earnings & Pro Forma Earnings Per Share 〃 Capital Surplus Distributed in Cash Pro Forma Average Yearly Return on 〃 Dividend rather than Investment Stock Dividend ＊ As we do not disclose our financial forecast information of 2010, in compliance with relevant government regulations, there is no need to provide this information.

4.1.9 Employees Bonus and Remuneration of Directors and Supervisors 1. Information relating to employees bonus and remuneration of directors and supervisors in the Articles of Incorporation: Pursuant to the Articles of Incorporation, employees bonus is 4% of distributable earnings. Remuneration of directors and supervisors is 3% of distributable earnings. 2. The estimating basis of the said bonus and remuneration shall be referred to the profit or loss of the year calculated by the Company and profit distribution condition in the past years. After the Shareholders' Meeting resolving the actual distribution amount, the difference would be regarded as accounting estimation adjustment and recognized to the profit and loss of 2010. 3. Information about profit distribution resolved by the Board of Directors on March 22, 2010: A. Employees cash bonus: NT $269,679,334 (3.42% of net income after tax). Remuneration of directors and supervisors: NT $202,259,500 (2.57% of net income after tax). The employees bonus is more than the estimation of 2009 for NT$25,683,746. The remuneration of directors and supervisors is more than the estimation of 2009 for NT$19,262,809. After Shareholders' meeting finalizes the actual distribution amount, the difference would be regarded as accounting estimation adjustment and recognized to the profit and loss of 2010.

B. Percentage of employees stock bonus to capital increase: None. C. Earning per share after the distribution of employees bonus and remuneration of directors and supervisors: NT$ 2.6253. 4. Actual distribution of employees bonus and remuneration of directors and supervisors in previous year, including number of share, amount, and stock price. The difference with recognized employees bonus and remuneration of directors and supervisors shall be stipulated, including the difference, reasons, and treatment: The Board of Directors resolved on March 25, 2009 to distribute employees bonus (NT $261,824,596) and remuneration of directors and supervisors (NT$ 196,368,447) which were recognized by the Shareholders’ Meeting. The employees bonus was fully distributed. The actual distributed amount of directors' and supervisors' remuneration was NT$ 176,900,000 (55.12% distributed to individuals and representatives; 44.88% distributed to juridical persons.) Retained un-distributed amount was NT$ 19,468,447. The employees bonus is less than the estimation of 2008 for NT$ 430,054. The remuneration of directors and supervisors is less than the estimation of 2008 for NT$ 322,541. These differences have been regarded as accounting estimation adjustment and recognized to the profit and loss of 2009.

◎Buyback of Treasury Stock: None. ◎Preferred Stock: None. ◎Employee Stock Option: None. ◎Merger or acquisition of other company’ share to issue new share: None.

Capital Formation

4.2 Summary of Corporate Bonds 4.2.1 Issued Corporate Bonds TYPE OF BOND 56th UNSECURED 57th UNSECURED 58th UNSECURED ISSUED ITEM CORPORATE BOND CORPORATE BOND CORPORATE BOND DATE ISSUED JUL. 26-27, 2005 OCT. 26-28, 2005 SEP. 22, 2008 PAR VALUE NT$1,000,000 NT$1,000,000 NT$1,000,000 ISSUE AND TRADE PLACE N/A N/A N/A ISSUE PRICE PAR VALUE PAR VALUE PAR VALUE NOMINAL AMOUNT NT$1,000,000,000 NT$1,500,000,000 NT$2,000,000,000 INTEREST RATE 1.89% 1.94% 3.05% FIVE YEARS. FIVE YEARS. FIVE YEARS. TERM MATURITY: MATURITY: MATURITY: JUL. 26-27, 2010 OCT. 26-28, 2010 SEP. 22, 2013 GUARANTY/GUARANTOR NONE NONE NONE CHINATRUST BANK OF TAIWAN, BANK OF TAIWAN, TRUSTEE COMMERCIAL TRUST DEPARTMENT TRUST DEPARTMENT BANK UNDERWRITER NONE NONE NONE CERTIFIED LAWYER M.T.HUANG M.T.HUANG M.T.HUANG CERTIFIED PUBLIC Y.W.FAN, L.W.KUO Y.W.FAN, L.W.KUO H.W. TAI, L.W.KUO ACCOUNTANT INTEREST PAID INTEREST PAID INTEREST PAID ANNUALLY SINCE ISSUE, ANNUALLY SINCE ISSUE, ANNUALLY SINCE ISSUE, REPAYMENT METHOD PRINCIPAL INSTALLED PRINCIPAL INSTALLED PRINCIPAL INSTALLED AT MATURITY AT MATURITY AT MATURITY OUTSTANDING BALANCE NT$1,000,000,000 NT$1,500,000,000 NT$2,000,000,000 REDEMPTION CLAUSES NONE NONE NONE RESTRICTIVE COVENANTS NONE NONE NONE Taiwan Ratings Taiwan Ratings Taiwan Ratings Corporation Corporation Corporation Long term Credit Ratings: Long term Credit Ratings: Long term Credit Ratings: twA twA twA+ CREDIT RATING Short term Credit Ratings: Short term Credit Ratings: Short term Credit Ratings: AGENCY/DATE/RATING twA-2 twA-2 twA-1 Outlook: Stable Outlook: Stable Outlook: Stable 56th Bond Ratings: twA 57th Bond Ratings: twA 58th Bond Ratings: twA Credit rating date: Credit rating date: Credit rating date: JUN. 23, 2005 SEP. 22, 2005 AUG. 7, 2008 AMOUNT NONE NONE NONE CONVERTED CONVERTIBLE ISSUE/ CONVERSION NONE NONE NONE RULES Terms to issuance, conversion, exchange and subscription. The impacts to NONE NONE NONE current shareholder equity and potential dilutions. CUSTODIAN NONE NONE NONE

TYPE OF BOND 1st UNSECURED CORPORATE 1st UNSECURED CORPORATE ISSUED BOND ISSUED IN 2009 BOND ISSUED IN 2010 ITEM DATE ISSUED SEP. 22, 2009 FEB. 5, 2010 PAR VALUE NT$1,000,000 NT$1,000,000 ISSUE AND TRADE PLACE N/A N/A ISSUE PRICE PAR VALUE PAR VALUE NOMINAL AMOUNT NT$5,000,000,000 NT$5,000,000,000 INTEREST RATE 1.95% 1.90% FIVE YEARS . MATURITY: FIVE YEARS . MATURITY: TERM SEP. 22, 2014 FEB. 5, 2015 GUARANTY/GUARANTOR NONE NONE MEGA INTERNATIONAL BANK OF TAIWAN, TRUSTEE COMMERCIAL BANK, TRUST DEPARTMENT TRUST DEPARTMENT UNDERWRITER NONE NONE CERTIFIED LAWYER M.T.HUANG M.T.HUANG CERTIFIED PUBLIC ACCOUNTANT H.W. TAI, Y.W.FAN H.W. TAI, Y.W.FAN INTEREST PAID ANNUALLY INTEREST PAID ANNUALLY SINCE ISSUE, 50% PRINCIPAL SINCE ISSUE, 50% PRINCIPAL REPAYMENT METHOD INSTALLED SEPERATELY AFTER INSTALLED SEPERATELY AFTER THE 4、5th ANNIVERSARY OF THE THE 4、5th ANNIVERSARY OF THE ISSUE DATE ISSUE DATE OUTSTANDING BALANCE NT$5,000,000,000 NT$5,000,000,000 REDEMPTION CLAUSES NONE NONE RESTRICTIVE COVENANTS NONE NONE Taiwan Ratings Corporation Taiwan Ratings Corporation Long term Credit Ratings: twA+ Long term Credit Ratings: twA+ Short term Credit Ratings: twA-1 Short term Credit Ratings: twA-1 CREDIT RATING Outlook: Stable Outlook: Stable AGENCY/DATE/RATING Bond Ratings: twA+ Bond Ratings: twA+ Credit rating date: Credit rating date: AUG. 12, 2009 DEC.22, 2009 AMOUNT NONE NONE CONVERTED

CONVERTIBLE ISSUE/ CONVERSION NONE NONE RULES

Terms to issuance, conversion, exchange and subscription. The NONE NONE impacts to current shareholder equity and potential dilutions. CUSTODIAN NONE NONE

Capital Formation

TYPE OF BOND ISSUED 1st OVERSEAS UNSECURED EXCHANGEABLE BONDS ITEM DATE ISSUED FEB. 20, 2008 PAR VALUE US$100,000 AND IN INCREMENTS OF US$1,000 THEREAFTER ISSUE AND TRADE PLACE SINGAPORE EXCHANGE ISSUE PRICE PAR VALUE NOMINAL AMOUNT US$210,000,000 INTEREST RATE 0% TERM FIVE YEARS MATURITY: FEB. 20, 2013 GUARANTY/GUARANTOR NONE TRUSTEE BNY MELLON UNDERWRITER MORGAN STANLEY SERVICES LIMITED CERTIFIED LAWYER Y.H.WANG CERTIFIED PUBLIC H.W. TAI, L.W. KUO ACCOUNTANT Unless previously redeemed, purchased or exchanged, the bonds will be redeemed REPAYMENT METHOD at their principal amount plus a premium calculated to yield a rate of 0.875% per annum to the maturity date. OUTSTANDING BALANCE US$210,000,000 A. The Issuer may early redeem the Bonds in whole or in part at any time after the 3rd anniversary of the Issue Date at the Early Redemption Price, if the value of the Exchange Securities into which US$100,000 and in increments of US$1,000 thereafter principal amount of the Bonds are exchangeable on the TSE (converted into U.S. dollars at the then prevailing exchange rate) is at least 130% of the Early Redemption Price for specified periods. REDEMPTION CLAUSES B. The Issuer may redeem all outstanding Bonds at the Early Redemption Price, in the event that more than 90% of the Bonds have been redeemed, purchased or exchanged. C. If, as a result of changes to the relevant tax laws and regulations in the ROC, the Issuer becomes obligated to pay any additional costs, the Issuer may redeem all of the Bonds at the Early Redemption Price, subject to the right of bondholders to forego payment of such costs and not be subject to such redemption. RESTRICTIVE COVENANTS NONE CREDIT RATING AGENCY/DATE/RATING NONE AMOUNT CONVERTED NONE Except for Closed Periods as prescribed by ROC laws and regulations or otherwise described in the Indenture, the bondholders shall have the right to require the Issuer to exchange the Bonds into the Exchange Securities at any time during the period from the 30th day after the issuance of the Bonds to the date falling 15 days prior to the Maturity Date. The aforementioned Closed Periods shall mean: A. The period within sixty days prior to the ordinary shareholders meeting, thirty days prior to the special shareholders meeting, and five days prior to the record date for CONVERTIBLE ISSUE/ distribution of dividends, bonus or other benefits. CONVERSION B. In the event of free distribution of stock dividend, issuance of new shares for capital RULES increase for cash or other distribution of stock dividends, bonus or other benefits by FENC, as applicable, the period starts three business days prior to the date of the public announcement to TSE of a record day for determination of shareholders with respect to such event and continues to the record day of such event. C. In the event of capital decrease of FENC, as applicable, the period starts from the record day for the capital decrease and continues to one day prior to the trading of shares reissued after the capital decrease. Terms to issuance, conversion, The Overseas Unsecured Exchangeable Bonds with a zero coupon rate, the exchange and subscription. The Bonds provide a low-cost source of long-term funds and reduce the interest impacts to current shareholder expenses, and therefore have a positive boost on the Issuer's profitability. equity and potential dilutions. CUSTODIAN NONE

4.2.2 Issued Exchangeable Bonds TYPE OF BONDS ISSUED 1st OVERSEAS UNSECURED EXCHANGEABLE BONDS YEAR As of Apr. 30, Launch Date 2008 2009 ITEM 2010ٛٛٛ NUMBER OF EXCHANGE 113,262,819 121,025,316 126,087,038 126,087,038 SECURITIES EXCHANGE 59.09 55.30 53.08(note 1) 53.08 PRICE/SHARE MARKET HIGHEST 100 115.63 103.29 103.54 PRICE PER LOWEST 100 85.83 88.00 101.23 UNIT(US$) AVERAGE 100 99.57 98.92 102.24 ISSUED DATE Feb. 20, 2008 EXCHANGE SECURITIES The Common Shares of Far Eastern New Century Corporation. Note1: Pursuant to the Indenture, the exchange price of the bonds had been adjusted to NT$53.08/share since August 25, 2009 as FENC distributed cash dividends and stock dividends.

Capital Formation

4.3 Summary of Issued GDR Sep. 13, 1996/ Issuing Date Item June 23, 1992 Jan. 23, 2007/ Mar. 25, 2008 Issue and Trade Place U.S.A., Europe, Asia U.S.A., Europe, Asia US$ 60,000,010.77/ Nominal Amount US$ 66,002,750 US$ 83,209,951.46/ US$ 61,355,000.00 US$ 19.67/ Issuing Unit Price US$ 27.50 US$ 9.905946602/ US$ 17.53 3,050,331/ Number of GDR Issued 2,400,100 8,400,000/ 3,500,000 ACC Shares Held by Far Eastern New Century Corporation / ACC Shares Held by Yuang Ding Investment Corp./ Subject Shares Far Eastern New Century Far Eastern General Contractor Corporation Co., Ltd, Far Eastern Construction Co., Ltd 30,503,310/ Number of Shares 24,001,000 84,000,000/ Represented 35,000,000 Right & Obligation of GDR Same as Common Stockholders Holders Trustee None Depositary Bank BNY Mellon Custodian Far Eastern International Bank Unredeemed Balance 655,299 (As of Apr. 30, 2010) (Number of GDR) Expenses for Duration of Related expenses of issuance and duration are undertaken by FENC GDR and ACC, respectively. Major Commitment of GDR holders are allowed to vote on a given agenda only when over Depositary/Custodian 51% of them reach consensus. Contracts Highest 8.09 Market 2009 Lowest 7.29 Price Average 7.85 Per GDR As of Highest 10.59 (US$) Apr. 30, Lowest 8.84 2010 Average 9.98

4.4 Status on Execution of Capital Utilization Plans 4.4.1 Issue of the First Overseas Unsecured Exchangeable Bonds By 2008 1. Description of the plans: Overseas raw materials procurement, fixed assets procurement, and domestic investment. a. Governmental approval date: The Central bank approved on December 31, 2007. The Financial Supervisory Commission, Executive Yuan approved on January 17, 2008 b. Total Capital: US$ 210,000,000(about NT$ 6,611,850,000) c. The source of funds: Issue overseas unsecured exchangeable bonds, issued amount: US$ 210,000,000. Term: Five years, Coupon rate: 0% d. Plan item and status of utilization: UNIT: NT$1,000 Fund utilization schedule Finish Total Plan item 2008 2009 2010 date Capital 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q Overseas raw 1Q10 5,037,600 125,940 629,700 629,700 629,700 629,700 629,700 629,700 629,700 503,760 materials procurement Fixed assets 1Q10 282,250 11,334 10,010 28,587 64,323 33,593 33,593 35,010 35,010 30,790 procurement Domestic 1Q08 1,292,000 1,292,000 －－－－－－－－ investment

Total － 6,611,850 1,429,274 639,710 658,287 694,023 663,293 663,293 664,710 664,710 534,550

e. Any changes to the plan, changing reasons, the benefits before and after the change, and the date on which the change is brought to the Shareholders' Meeting: None.

Capital Formation

2. Status of utilization: Status of utilization of fund raised from the project was declared quarterly and uploaded the recent information to the website specified by SFC. The utilization status was summarized as below: UNIT: NT$1,000 Reasons of progress advancing As of Dec. Accumulation Plan item Status of utilization 1Q10 or delaying and related 31, 2009 by 1Q10 improvements Overseas Scheduled 4,533,840 503,760 5,037,600 The plan will be completed until raw materials Amount the fourth quarter of 2010. procurement Actual 3,490,854 414,775 3,905,629

Fixed assets Scheduled 251,460 30,790 282,250 The plan has been completed in Amount procurement Actual 243,798 38,563 282,361 the first quarter of 2010.

Domestic Scheduled 1,292,000 0 1,292,000 The plan has been completed in Amount investment Actual 1,292,000 0 1,292,000 the first quarter of 2008.

Scheduled 6,077,300 534,550 6,611,850 Total Amount Actual 5,026,652 453,338 5,479,990

◎ The impact to company’s operating gain/loss from procurement of fixed assets: UNIT: NT$1,000 Year Difference 1Q09 1Q10 Items Amount Note Fixed Assets 2,475,180 2,243,109 (232,071) Operating cost increased by 13% compared to the same Sales revenue 2,542,553 2,339,250 (203,303) period of last year. The main factors were raising coal Operating cost 1,945,621 2,188,088 242,467 price and higher average unit production cost caused by Gross profit 579,076 158,619 (420,457) less production volume. Operating income is inferior to the same period of last year. Operating income 443,838 29,844 (413,994)

◎ The impact to company’s investing gain/loss from the investment: UNIT:NT$1,000 As of March 31, 2010 Investee Yuan Long Stainless Steel Co. Ltd. Note Items Net Income 44,264 Holding Percentage (%) 51% - Investment Gain Recognized 17,816

V. OVERVIEW OF BUSINESS OPERATION

5.1 Business Introduction 5.1.1 Business Scope 1. Scope of Business: Please refer to page 7. 2. Main Business and Percentage: A. Production and sales of Cement and clinker: 90.6% B. Granulated blast-furnace slag: 9.4% 3. New Product Research & Development: None

5.1.2 Industry Overview 1. Market situation and future outlook A. The domestic cement market in Taiwan is mature and the demand remains stable. In 2009, Taiwan overall cement consumption amounted to 10.37 million metric tons (MT), which decreased by 1.42 million MT or 12% from 2008. The international cement market remained robust and the two major manufacturers (Asia Cement Corp. and Taiwan Cement Co., Ltd.) made the highest export volume on record. The total cement and clinker sales by Taiwan local producers were 15.93 million MT, reduces 1.21 million MT or 7.1% than the previous year. B. For the year 2010: (1) Domestic market: Taiwan economy gradually recovered from the global financial tsunami, and many economic indices had reversed up. With the growth of real estate market and the accelerating government investment, the Company forecasts that the cement demand will increase in year 2010. (2) Overseas market: Global economy is expected to improve and shall be better than the last year after financial tsunami. Cement demand for developed countries such as America and the European countries will remain flat or slightly increase in the 2nd half of 2010. Cement consumption in emerging markets, such as South-East Asia, Africa, India, South America…,etc. are estimated to grow about 5% due to the higher demand for construction and infrastructure projects. On the whole, Taiwan domestic demand will increase and the oversea cement market will also restore to a growth trend. The Company will continue to balance its production and the sales. C. In addition to root in Taiwan for on-going cement business operation, the Company enhanced its competitiveness by largely expansion in Mainland China both in production and sales.

Overview of Business Operations

◎The relationships among the value chain of cement industry

The upstream, midstream and downstream sectors of cement industry, namely ready-mixed concrete, precast, and construction industry, are co-existed and blooming together. Nowadays, vertical integration is the trend in cement industry. As a result, the Company’s operation strategy is to establish the downstream subsidiaries－Ya Tung Ready-mixed Concrete Corp. and Yali Precast & Prestressed Concrete Industries Corp., and to invest Far Eastern Construction Company and Far Eastern General Contractor Company to grasp the business opportunities .

◎Product development and company competitiveness

Although the cement products include Portland Cement Type I, Type II, and Special Cement, the major market demand is Portland Cement Type I. However, the overseas market has stronger demand for Special Cement in recent years. The ability to produce quality products and the shipping & loading efficiency has become the key competitive factors. 5.1.3 Technology and Research Development Up to April 30, 2010 Unit: NT$1000 Item Amount Purpose and Benefit Researches on improving To improve quality control ability of technique of quantifying mineral raw material, clinker and cement by 1 phases in raw material, clinker and 5,500 quantifying mineral phases quickly cement. and precisely Researching on producing To develop the recipe of masonry 2 masonry cement to meet the 1,500 cement to replace the bagged type I market demand. Portland cement for masonry purpose. Design and assembling of steel To prevent falling rock, vegetation 3 cable saw to cut the lime stone in 500 destruction as well as reduce the the edge of the mine. public concern. Planning to use substitutive raw 806 To implement environmental 4 protection and increase income and cut material and fuels (Income) cost Total 6,694

＊Future R&D projects and estimated expenditure Unit: NT$1000 Item Amount Use and Benefit Study of mineral additives and chemical admixtures to heat of cement Researching on effect of mineral hydration by using multi-channel 1 additives and chemical admixtures 2,100 automatic calorimeter to improve the to heat of cement hydration. quality of cement and to enhance customer service. Total 2,100

＊There is no new technology and product developed up to the printing date of the annual report.

5.1.4 Short-term Business Plan ◎ To strengthen the existing domestic and international channels of cement sales. ◎ To reduce costs, maintain full production, and sound profitability. ◎ To fulfill the vertical integration policy and to expand into downstream market channels. 5.1.5 Long-term Business Plan ◎ Maintain solid position in Taiwan - to build No.4 kiln in Hulian Plant depending on market demand. ◎ Increase the investment in China (Please refer to “the Report to Shareholders” at page 1 and the “Information about Affiliated Companies” at page 87 of this annual report. ◎ Extend the global market - to expand in emerging markets and become an international cement enterprise.

5.2 General Information of Market & Production 5.2.1. Markets Analysis 1. Major Sale Markets A. Cement and Clinker: We use “Skyscraper” as the brand-name to market for all kinds of our products. Our domestic market included Taiwan, Penghu, Kinmen and Matsu, and the overseas market, such as Singapore, Malaysia, Hong Kong, Vietnam, USA, Middle East, and Africa. B. Ready-Mixed Concrete: To provide better customer service, our subsidiary, Ya Tung Ready-Mixed Concrete Corp., has set up many plants around Taiwan, and furthermore established strategic alliance with strong local players. 2. Market Share In year 2009, the Company domestic sales was up to 2,500,328 MT, i.e. 32.24% of the sales amount of all domestic cement producers, which was equal to 24.11% of total cement consumption in Taiwan. 3. Market supply forecast, growth opportunity, and business competitiveness: A. Since the market is saturated, and very difficult to set up new capacity, the estimated demand of 2010 in Taiwan will be around 11 million MT. However, the cement price will be influenced by cost of energy, labor, raw material, and the cement volume imported to Taiwan B. For the export volume, the total amount in 2009 was higher than that in 2008, which was a result of more quantity exported to Nigeria, Malaysia. In addition, for our long term valued customers in Singapore, USA, and Middle East, we maintain our good relationships with them and also set up cement terminals and sales channels in these areas to ensure the stable supply and distribution of our cement products. C. In view of the vast and steady growth market in China, Asia Cement Corp. actively expands production base as well as storage and transportation facilities. In addition, with markets in both Taiwan and China, it constitutes an effective competitive niche and profitability for the Company.

Overview of Business Operations

4. Positive factors for the industry The cement player in Taiwan generally believes that once “I-Taiwan 12 projects”, “Economic Recovery Project”, and “Morak post-disaster reconstruction projects” are executed, it will drive private sector investments and enhance the domestic demand of cement product. 5. Negative factors and the solutions A. Substantial increase of cement & clinker imports will damage Taiwan domestic market and affect the selling price. B. Industry relocation, environmental awareness, and emission limits of carbon dioxide will increase the difficulties in both public constructions and private housing sectors, and cause the construction industry more conservative. This will constrain the growth of cement demand. C. Solutions; (1) Strategy for domestic business: Improve the efficiency of current production, transportation and marketing activities and strengthen the downstream distribution channels. (2) Strategy for export business: Continue selecting good target markets, establish production and distribution channels, expand customers in emerging countries, and realize reasonable profitability. 5.2.2 Application of Major Cement Products 1. Portland Cement Type I: It is known as ordinary cement, used for all structural projects which are not particularly exposed to sulphuric acid or underground water. Most of the current market supply is in this category. 2. Portland Cement Type II: With lower hydration heat than Portland Cement Type I as well as low alkalis and moderate resistance to sulfate, Portland Cement Type II is for large-scale structures. It is resistant against cracking and erosion by sea water, salt, and alkali. The general purposes are as follows: A. Underground foundation engineering: Tower Building Basement, underpass, sewers, tunnels and massive underground rapid transit systems. B. Large-scale concrete works: Bridges, dams, water retention facilities, valve based structure. C. Construction subject to erosion by sea water and sea wind: dock, breakwaters, caisson, breeding plants, harbors, and others. D. Project that requires resistance to sulfate: Sewage treatment plants and chemical engineering. 3. Special Purpose Cement: Produced to meet customers’ special needs. 4. Production process: All types of cement are produced in accordance to a fixed proportion of mixtures, in the following steps: A. Limestone and clay are mixed and ground into raw meal. B. Raw meal is poured into the rotary kiln and burned in high temperature to produce clinker. C. Clinker is mixed with gypsum and ground into cement. D. Cement is sold in bulk or packages.

5.2.3 Supply Condition of Main Raw Materials The major raw materials used by the Company consist of lime stone, clay, gypsum, pyrite and raw coal for fuel. Limestone is produced and used by the Company alone. Clay is purchased from domestic suppliers through long-term contracts. Gypsum and pyrite are supplied by qualified domestic and foreign manufacturers. Fueled coal is supplied by Australian and Chinese providers via way of long-term or short-term contracts. In 2009, the gradual global economic recovery progressively stabilized raw material supply. The price and quality of raw materials remain stable since the Company relied mostly on long-term contracts.

5.2.4 Major Suppliers Information for the Last Two Calendar Years Unit: NT$1,000 2008 2009 2010 (As of March 31) Relation Relation Relation Item Company Name Amount % Company Name Amount % Company Name Amount % with Issuer with Issuer with Issuer Raw material Raw material Raw material 1 AA Co., Australia 1,342,502 32.80 AA Co., Australia 721,393 25.50 FLSmidth 209,686 22.38 supplier supplier supplier Raw material Raw material 2 BB Co., Australia 351,751 12.40 AA Co., Australia 168,921 18.03 supplier supplier Raw material Raw material 3 Chung Ling Co. 345,280 12.20 Chung Ling Co. 166,255 17.74 supplier supplier Raw material Raw material Raw material Others 2,883,938 67.20 Others 1,413,440 49.90 Others 392,071 41.85 supplier supplier supplier Net Total Supplies 4,226,440 100.00 Net Total Supplies 2,831,864 100.00 Net Total Supplies 936,933 100.00 Note 1: Major suppliers mean each commanding 10%-plus share of annual order volume. - 57

57 5.2.5 Major Clients Information for the Last Two Calendar Years Unit: NT$1,000 2008 2009 2010 (As of March 31) Overview of BusinessOperations Overview of Company Relation Company Relation Company Relation Item Amount % Amount % Amount % Name with Issuer Name with Issuer Name with Issuer Ya Tung Ya Tung Ya Tung 1 Ready-Mixed 1,402,275 13.3 Subsidiary Ready-Mixed 947,980 9.5 Subsidiary Ready-Mixed 362,591 15.6 Subsidiary Concrete Co. Concrete Co. Concrete Co. Others 9,150,949 86.7 Clients Others 9,026,463 90.5 Clients Others 1,954,337 84.4 Clients Net Sales 10,553,224 100.0 Net Sales 9,974,443 100.0 Net Sales 2,316,928 100.0 Note 1: Major clients mean each commanding 10%-plus share of annual order volume.

5.2.6 Output of Main Products 2008-2009 UNIT: NT$1,000;MT 2008 2009 Year Output Capacity Production Amount Capacity Production Amount

Product

Cement & Clinker 5,597,000 5,131,514 8,242,088 5,597,000 4,888,838 7,777,143

5.2.7 Sales of Main Products 2008-2009 UNIT: NT$1,000; MT 2008 2009 Year Domestic Sales Export Sales Domestic Sales Export Sales Sales Volume Value Volume Value Volume Value Volume Value Product

Cement & Clinker 2,994,785 6,746,500 2,046,066 2,934,451 2,587,581 6,029,587 2,320,961 3,239,428

Granulated 628,809 828,905 - - 505,900 654,484 3,032 5,428 blast-furnace slag

Total 3,623,594 7,575,405 2,046,066 2,934,451 3,093,481 6,684,071 2,323,993 3,244,856

＊Please refer to page 2 for the Key Performance Indicator (KPI) of the Company.

Overview of Business Operations

5.3 Human Resources

Year 2008 2009 Up to April 30, 2010 Headquarter 208 158 155 Hsinchu Plant 171 168 167 Number of Employees Hualien Plant 347 342 342 Total 726 668 664 Average Age 46.30 46.65 46.94 Average Years of Service 20.21 20.59 20.90 Ph.D. 0.14% 0 0 Masters 5.01% 5.09%4.9% Education Bachelor’s Degree 39.08% 35.48% 35.81% Senior High School 44.51% 46.86% 47.5% Below Senior High School 11.27% 11.68% 11.84%

5.4 Expenditures on Environmental Protection According to government regulations, the Company set up the continuous emission monitoring system to monitor pollutant opacity of nitrogen oxides, sulfur oxides, and other pollutants. ◎ During the most recent fiscal year and the current fiscal year up to the printing date of the annual report, the loss (including compensation) and penalty resulted from environmental pollution: (1) Fine: none. (2) Countermeasures: none. ◎ The restriction of RoHS (to restrict the use of hazardous chemicals) is not applicable to the Company. 5.4.1 ISO-14001 Environmental Management Systems (EMS) 1. ISO-14001 EMS has become the trend in many advanced countries. 2. In August 1996, the Hualien plant of the Company passed certification by the Bureau of Commodity Inspection and Quarantine of the Ministry of Economic Affairs (MOEA), and in November of the same year, Hualien plant became one of the first organizations in Taiwan to receive ISO-14001 certification. In July 2000, Taiwan’s first Environmental Report was completed by Hualien plant according to Sustainability Reporting Guidelines of Global Reporting Initiative (GRI). 3. The affiliated Jiangxi Yadong Cement Co. honored the certification by China’s Zhong-Huan United Recognition Center in April 2005, and received ISO-14001 certification in May 2005.

5.4.2 Air Pollution Prevention 1. One of the main environmental concerns relating to cement production is air pollution caused by the dust generated from production processes. Therefore, the work of dust disposal is an important duty, not only to prevent air pollution, but also to reduce the loss of raw materials and finished products. Consequently, ACC has always emphasized on the efficiency of dust collection equipment. 2. At present, ACC's Hsinchu plant has 2 electrostatic precipitators and 35 bag filters, with a total investment cost of NT $174 million. The Hualien plant has 9 electrostatic precipitators and 75 bag filters, with a total investment cost more than NT $950 million. 3. The good maintenance of above equipments ensures dust collection efficiency which is within the legal limit. Consequently, the quality of air around the plants is higher than national standard. As a result, the Environmental Protection Administration (EPA) especially recognized the two plants as environmental protection demonstration plants. 4. In particular, the amount of dust including chimney emissions measured by environmental protection agencies at the Hualien plant was less than 25 milligrams/m3, which was far better than national standard. The plant was awarded by the Chinese National Federation of Industries for its excellent performance of preventing industrial pollution. In addition, the Hualien plant was listed by the EPA as one of the top 10 factories in pollution prevention and has received the Enterprise Environmental Protection Award for three years in a row. 5. In 2009, the environment expenditure of the Hualien plant, such as purchasing and maintenance of precipitators, training courses, greening and beautification was NT$83,028,336.

5.4.3 Greening and Beautification for Quarry Restoration 1. Both Hsinchu and Hualien plants have implemented measures for soil conservation and taken actions to green the environment by planting trees and other vegetation. 2. The Hualien plant, which is located close to the Taroko National Park, particularly emphasizes the importance of restoring quarries by growing plants. After several decades, our effort and investment are coming to fruition. 3. Due to Hualien Plant’s dedication of planting aboriginal plants and engaging in community activities, the Taroko National Park has resolved to develop a project of aboriginal vegetation for greening and beatification as well as offering services for environment introduction in cooperation with the Hualien plant of ACC. 4. In 2003, the Hualien Plant was awarded for the merits of environment beautification and greening from the Environment Greenery Association R.O.C. 5. In 2007, the Hualien Plant was awarded for the excellent performance in the project of “promoting green communities” by the Environmental Protection Administration, Executive Yuan.

Overview of Business Operations

5.4.4 Major Environmental Protection Work in the Future 1. Reinforcing and ensuring the normal operation of environmental facilities. 2. Practicing in industry waste reduction; avoiding pollution. 3. Improving the greening rate in factory and quarry areas. 4. Utilizing wastes as resources to take social responsibilities. 5. Endlessly enhancing the environmental measures and techniques; expecting to reach the goal of “zero pollution”.

5.4.5 Fulfill Social Responsibilities 1. The Company volunteered to take care of greenbelts and pavements alone the Dun-Hua South Road and An-He Road over a long period of time to fulfill its social responsibilities and strengthen relations with neighborhood. 2. Since 2001 on, Hualien plant has annually participated in local festivals such as lily blossom in Buluowan held by the Taroko National Park and donated premium potted flowers and plants for all visitors. 3. For the sake of local traffic safety, Hualien plant has regularly sponsored Shincheng Branch of the Hualien County Police Headquarter to renew police stands and maintain streetlamps. 4. Irregularly, the Company sponsors the villages and towns nearby the Hsinchu and Hualien factories including local activities and facilities, such as streetlamps and roads. 5. Based on ACC corporate philosophy of ‘feeding back to society whatever one takes from society’, the Company sponsors the foundations and participates in all kinds of public service activities.

5.5 Labor Relations The Company complies with every regulation of labor relationship. Due to the excellent labor relations, there were no damages or penalties causing from labor disputes. 1. The Company has Industrial Welfare Committee to allot welfare fund for staffs according to law and conduct many welfare-related activities. In factory, we have basketball courts, tennis courts, badminton courts, table tennis courts, and swimming pools, etc., as staff's recreational facilities. Health examination, group insurance, subsidies for employee’s education, trips, and clubs are also included in welfare plans. 2. Employee Relations The Company provides Employee Assistance Program (EAP) service from Hsinchu Lifeline Association, EAP Center, which offers professional counsel to all issues employees may meet, such as career development, family issues, and interpersonal relationship.

3. The Company participates in the training programs planned by the training center of Far Eastern New Century Corp. within the Far Eastern Group every year, which include professional courses such as finance, accounting, marketing, information, and executive programs for management development. The Human Resource Department also holds in-house courses customized for different functions and levels. These courses provide executives and employees with sufficient training opportunities, which not only can be applied to the workplace, but also connect with employees’ career development. Also, the Far Eastern EMBA programs designed and tutured by professors from Center for Management Studies, Yuan-Ze University, provide the chances of advanced study with employees and develop staffs’ excellent talents for the Company’s long-term development. In addition, based on actual needs, every department of the Company recommends employees to participate in the courses introduced by government bodies and other social institutions in order to acquire the latest relevant information. Furthermore, Human Resource Department holds reading club, inviting a professional lecturer monthly to guide reading and facilitate discussion, encouraging employees to absorb new concepts and sharing knowledge. In 2009, totally 180 training courses were held for ACC employees, roughly equal to 1,850 participants; the relevant expenditures amounted to NT$2.4 million. 4. The “Employment Rules of ACC” articulates regulations in connection with appointment, service, assessment, and rewards as well as punishments, promotion, retirement, and compensation, etc. In order to guarantee the rights relating to retirement and compensation, in accordance with the law the Company sets up Supervisory Committee of the Labor Retirement Fund, allocates work’s retirement reserve fund into the special account managed by assigned institutions, regularly convenes the supervisory committee, and audits the allocation and practice of work’s retirement reserve fund. In addition, in compliance with Labor Pension Act, the Company monthly set aside pension fund for the employees who choose to be subject to the pension mechanism. 5. ACC’s management believes –“Sincerity, Diligence, Thrift and Prudence” firmly in every employee’s heart. “Sincerity” implies honest and enthusiasm. “Diligence” indicates dedication. “Thrift” signifies frugality and modesty. “Prudence” represents deliberation and accuracy. In short, one important corporate culture of ACC is that every job should be done thoroughly, precisely, and perfectly. In “Employment Rules of ACC” mentioned above, the chapter 4 ‘Service’, and chapter 7 ‘Assessment, Reward, Punishment, and Promotion’ clearly illustrate the principles of conduct. In terms of management, besides emphasizing staff self-discipline, the Company asks department executives to take responsibilities of educating, advising, and leading their subordinates, which enables employees to fully understand the behavior and ethics criteria.

Overview of Business Operations

6. Policies of labor safety and health: A. Management in Labor Safety and Health To fulfill enterprise responsibilities, the Company’s policies of labor safety and health is based on the following vision-“protecting labor safety, improving occupational environment, and building up friendly workplace.” Also, we comply with Labor Safety and Health Act, carry out systematical management in occupational health and safety, and implement identification of the hazardous factors, risk evaluation and control in workplace. Besides setting up safety standards and developing safety management system, the safety-related training courses, such as prevention of hidden dangers, emergency response planning, and safety self-management are regularly and irregularly held, to ensure that all employees can obey safety related rules and operate safety equipment and protective outfits well. Additionally, we usually review PDCA Cycle in the safety management to assure that all polices and measures are precisely excused. In February 2009, the Hualien plant has passed TOSHMS (Taiwan Occupational Safety and Health Management System). It is an honor as the first company in cement industry receiving this certification. Now, the Hsinchu Plant is also trying to cpoy the success of Hualien for establishing a faultless occupational safety and health management System. B. Workplace environment and labor safety protection To assure employee safety and health, protect the assets of the Company, and make comfortable and safe workplace, based on safety-related rules, we have the following active measures: Following procurement to assure the intrinsic safety of raw materials and equipment: conforming to the safety and health standard is the essential consideration of purchasing raw materials and equipment to assure the intrinsic safety of manufacture procedure, products, and equipment. General safety management, training courses, and related auditing: We monthly hold safety and health committee and safety-related courses for employees and contractors to make sure that everyone working with ACC fully understands the possible hazardous factors and prevention measures in workplace, and obeys safety-related standards to preclude the occurrence of any disaster. Also, by means of “the walking around management” and frequently patrols, we investigate flaws and also improve them to assure the effective operation in safety management. Workplace environmental monitoring system and usage of protective outfits: All plants regularly monitor noise, high temperature, and radiation around workplace, so the unusual condition can be immediately detected and eliminated. Also, all employees can be protected from possible dangers by protective outfits designed for different hidden hazardous factors in workplace.

7. ACC has enjoyed harmonious relations between management and employees for years. Employees devoted their time and hard work to the Company. In recent years, the Company's continuous excellent performance of sales and production is a proof of employees' effort. The Company's work and employment regulations are based on the Labor Law and in some cases even exceed the minimum requirements of the law. Besides reasonable payment, ACC gives seasonal bonuses to encourage clinker production, attendance award, and cost and resource-saving measures, as well as year-end bonuses based on the Company's annual performance. In addition, employees are entitled to other dividends depending on their positions in the Company. All regulations concerning bonuses are clearly stipulated in the Company’s regulations.

Overview of Business Operations

5.6 Major Contracts

Type of Restrictive Contracting Party Duration Primary Contents Contract Clauses

Bank long-term Interest paid monthly, principal Calyon Taipei Branch 2009/06~2011/06 None unsecured loan repaid at maturity

Bank long-term BNP PARIBUS Interest paid monthly, principal 2010/01~2012/01 None unsecured loan Taiwan repaid at maturity

Bank long-term E.SUN Commercial Interest paid monthly, principal 2009/08~2011/08 None unsecured loan Bank repaid at maturity Mega International Bank long-term Interest paid monthly, principal Commercial Bank 2009/06~2011/06 None unsecured loan repaid at maturity Foreign Dept. Mega International Bank long-term Interest paid monthly, principal Commercial Bank 2009/07~2011/07 None unsecured loan repaid at maturity Foreign Dept. Bank long-term Mizuho Corporate Interest paid monthly, principal 2009/06~2011/06 None unsecured loan Bank, Taipei Br. repaid at maturity

Bank long-term Chang Hua Bank Interest paid monthly, principal 2009/08~2011/08 None unsecured loan Tung-Hwa Br. repaid at maturity

Bank long-term Hwa Nan Commercial Interest paid monthly, principal 2009/12~2011/12 None secured loan Bank. Tung-Hwa Br. repaid at maturity

Bank long-term First Bank, Interest paid monthly, principal 2009/11~2011/11 None secured loan Tung-Hwa Br. repaid at maturity

Bank long-term Chinatrust Interest paid monthly, principal 2009/10~2011/10 None unsecured loan Commercial Bank repaid at maturity Mega International Bank long-term Interest paid monthly, principal Commercial Bank 2007/12~2010/12 None secured loan repaid at maturity Foreign Dept. Far Eastern Bank long-term Interest paid monthly, principal International Bank 2010/01~2012/01 None secured loan repaid at maturity Business Dept. Guarantee Shanghai Commercial 2009/09~2011/09 Commercial paper guaranteed None contract & Savings Bank, LTD

Bank long-term Citibank Interest paid monthly, principal 2009/03~2011/03 None unsecured loan (Taiwan) Limited repaid at maturity

Bank long-term HSBC Bank (Taiwan) Interest paid monthly, principal 2009/07~2011/07 None unsecured loan Limited repaid at maturity

Bank long-term Repaid in two equal installments T.C.B. Ta-An Br. 2006/06~2011/06 None secured loan from the 4th year half and 5th year

Type of Restrictive Contracting Party Duration Primary Contents Contract Clauses Mega International Bank long-term Interest paid monthly, principal Commercial Bank 2006/06~2011/06 None secured loan repaid at maturity Foreign Dept. Bank long-term Repaid in three equal installments Land Bank 2007/06~2011/06 None unsecured loan from the second year

Bank long-term Repaid in two equal installments T.C.B Ta-An Br. 2007/06~2012/06 None secured loan from the 4th year half and 5th year

Long-term fuel Contract of Coal Purchase from AA Co., Australia 2009/01~2009/12 N/A supply Australia

Long-term Chung-Ling Contract of Limestone, Clay, Shale 2009/01~2009/12 N/A material supply Enterprise Purchase

Long-term fuel Contract of Coal Purchase from BB Co., Australia 2008/09~2009/12 N/A supply Australia

Long-term Fu-Shan Mineral Contract of Limestone and Clay 2009/01~2009/12 N/A material supply Stone Co.,Ltd. Purchase

Long-term Ju-Kai Co., Ltd 2008/06~2010/05 Contract of Gypsum Purchase N/A material supply

Long-term Yuan-Tai Enterprise 2008/07~2009/07 Quarrying Project N/A material supply Long-term construction Nan-Xin Enterprise 2009/01~2009/12 Construction Project Contract N/A project Long-term Fu-Zhou-Quan 2009/04~2010/04 Contract of Limestone Purchase N/A material supply Co.Ltd

Financial Information

VI. FINANCIAL INFORMATION

6.1 Financial Reports & Audit Results (2005~2010/3/31) 6.1.1 Balance Sheets UNIT: NT$1,000 Year Five-Year Financial Summary Up to Mar. 31, Item 2005 2006 2007 2008 2009 2010

Current Assets 6,123,959 4,926,217 5,633,570 8,914,267 12,106,864 11,513,051

Long-term Investments 52,479,365 65,795,198 81,406,224 76,352,304 87,860,207 87,086,142

Properties and Equipment 2,045,649 1,950,074 1,964,543 2,674,512 2,335,666 2,243,109

Other Assets 8,442,803 8,240,094 8,315,710 8,480,519 8,576,388 8,611,759

Total Assets 69,091,776 80,911,583 97,320,047 96,421,602 110,879,125 109,454,061

Before Apportioned 4,826,157 3,232,789 4,943,226 5,121,382 11,997,286 10,679,782 Current Liabilities After Apportioned 7,992,569 7,469,327 12,123,995 10,339,172 - -

Long-term Liabilities 10,850,000 14,817,482 16,913,396 23,369,087 20,744,595 21,296,588

Other Liabilities 3,295,541 3,176,436 3,143,634 3,091,038 3,052,213 3,107,389

Before Apportioned 18,971,698 21,226,707 25,000,256 31,581,507 35,794,094 35,083,759 Total Liabilities After Apportioned 22,138,110 25,463,245 32,181,025 36,799,297 - -

Capital Stock 23,445,566 25,321,211 27,346,909 28,987,723 29,857,355 29,857,355

Capital Surplus 6,761,430 6,888,054 6,885,839 8,080,494 8,197,276 8,241,439

Before Apportioned 16,268,102 18,387,057 22,188,989 20,490,138 22,263,824 23,896,663 Retained Earnings After Apportioned 11,226,045 12,124,821 13,367,406 14,402,716 - - Unrealized Gains (Losses) on (152,043) 4,959,229 10,695,704 241,642 8,894,624 6,760,270 Financial Instruments* Cumulative Translation 1,133,035 1,412,830 2,494,245 4,479,430 3,201,493 2,956,477 Adjustments Net Loss not Recognized as (122,143) (69,636) (78,026) (225,463) (115,672) (128,033) Pension Cost Unrealized revaluation increments 2,786,131 2,786,131 2,786,131 2,786,131 2,786,131 2,786,131

Total Before Apportioned 50,120,078 59,684,876 72,319,791 64,840,095 75,085,031 74,370,302 Stockholders’ Equity After Apportioned 46,953,666 55,448,338 65,139,022 59,622,305 - -

Note: Financial data for the first quarter of 2010 have been reviewed by CPA. * The new issued SFAS NO 34. “Accounting for Financial Instruments” has been adopted since January 1st,2006.

6.1.2 Statements of Income UNIT:NT$1,000 Year Five-Year Financial Summary Up to

Mar. 31,

2010 Item 2005 2006 2007 2008 2009

Operating Revenue 10,747,433 10,811,363 10,745,510 10,515,471 9,962,152 2,339,250

Gross Profit 2,460,643 2,774,768 2,111,563 1,647,684 1,501,359 151,162

Operating Income 2,073,411 2,370,737 1,733,252 1,029,313 900,633 29,844 Nonoperating Income and 5,815,375 6,174,964 9,671,053 7,792,612 8,492,050 1,853,164 Gains Nonoperating Expenses and (830,051) (810,791) (920,086) (1,277,587) (1,271,217) (200,567) Losses Income before Income Tax 7,058,735 7,734,910 10,484,219 7,544,338 8,121,466 1,682,441 Cumulative Effect of Changes in Accounting - 53,780 - - - - Principles Net Income 6,620,013 7,206,555 10,100,422 7,314,642 7,885,009 1,614,305

Earnings Per Share (NT$) 2.82 2.85 3.69 2.52 2.64 0.54 Earnings Per Share (NT$) (Based on outstanding 2.22 2.41 3.38 2.45 2.64 0.54 shares in 2009) Note: Financial data for the first quarter of 2010 have been reviewed by CPA.

6.1.3 Auditors’ Opinions from 2005 to 2009 Year CPA's Name Audit Opinion 2005 You Wei Fan、Li Wen Kuo Unqualified Opinion 2006 You Wei Fan、Li Wen Kuo Modified Unqualified Opinion 2007 Hsin Wei Tai、Li Wen Kuo Unqualified Opinion 2008 Hsin Wei Tai、You Wei Fan Modified Unqualified Opinion 2009 Hsin Wei Tai、You Wei Fan Modified Unqualified Opinion

Financial Information

6.2 Financial Analysis (2005~2010/3/31)

Year Financial Analysis(2005~2009) Up to Mar. 31, Item 2005 2006 2007 2008 2009 2010

Capital Debts Ratio 27.46 26.23 25.69 32.75 32.28 32.05 Structure （％） Long-term Capital In % of Fixed Assets 2,980.48 3,815.83 4,541.24 3,298.14 4,102.88 4,264.92

Current Ratio（％） 126.49 152.38 113.97 174.06 100.91 107.80 Repayment Quick Ratio（％） 91.93 Ability 92.46 98.90 73.28 130.33 85.26 Times Interest Earned 27.89 27.90 28.58 13.84 17.94 13.70

Turnover of Receivable(Times) 8.53 9.08 9.96 8.88 9.07 10.93

Average Collection Days of Receivable 43 40 37 41 40 33

Turnover of Inventory (Times) 5.41 5.09 4.91 4.41 4.42 5.48 Operating Turnover of Payable (Times) 6.15 Efficiency 8.22 8.09 9.68 8.20 6.20 Average Days of Sales 68 72 74 83 83 67

Turnover of Fixed Assets (Times) 5.25 5.54 5.47 3.93 4.27 4.17

Turnover of Total Assets (Times) 0.16 0.13 0.11 0.11 0.09 0.09

Return on Total Assets (%) 10.35 9.90 11.65 8.01 7.95 6.22

Return on Stockholders’ Equity (%) 13.91 13.13 15.30 10.67 11.27 8.64

In (%) of Operating Income 8.84 9.36 6.34 3.55 3.02 0.40 Profitability Capital Stock Income Before Income Tax 30.11 30.76 38.34 26.03 27.20 22.54 （％） Profit Margin (%) 61.60 66.66 94.00 69.56 79.15 69.01

Earnings Per Share (N.T.$) 2.82 2.85 3.69 2.52 2.64 0.54 Earnings Per Share (NT$) 2.22 2.41 3.38 2.45 2.64 0.54 (Based on outstanding shares in 2009 ) Cash Flow Ratio 135.53 175.26 94.20 134.19 44.68 12.38 Cash Flow Cash Flow Sufficient Ratio 112.19 （％） 195.75 203.92 165.27 139.43 121.87 Cash Reinvestment Ratio 4.69 3.00 0.78 0.28 0.12 1.13

Degree of Degree of Operating Leverage 1.78 1.81 2.18 3.17 3.67 18.81 Leverage Degree of Financial Leverage 1.14 1.14 1.28 2.33 2.14 0.29 The explanation of the change in financial ratios in recent two years: Current ratio, quick ratio and cash flow ratio decreased due to the increase of current portion of long-term liabilities.

Note: Financial data for the first quarter of 2010 have been reviewed by CPA.

6.3 Supervisors’ Review Report on the 2009 Financial Statements

To: The 2010 Regular Shareholders’ Meeting

The undersigned has duly audited the Report to Shareholders, Financial Statements certified by CPA Mr. Hsin Wei Tai and Mr. You Wei Fan of the Deloitte & Touche, together with the Schedule of Earnings Distribution prepared by the Board of Directors for the year of 2009, and found the same to be true and correct. Therefore, in accordance with Article 219 of the Company Act of the Republic of China, the undersigned takes pleasure in submitting this report for your perusal and acceptance.

Asia Cement Corporation Supervisor: S.Y. Wang

Champion Lee

Eli C. Wang

T.Y. Tung

L.T. Chang

April 28, 2010

Financial Information

6.4 Independent Auditors’ Report

The Board of Directors and Stockholders Asia Cement Corporation We have audited the accompanying balance sheets of Asia Cement Corporation (the “Corporation”) as of December 31, 2009 and 2008, and the related statements of income, changes in stockholders’ equity and cash flows for the years then ended. These financial statements are the responsibility of the Corporation’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Rules Governing the Audit of Financial Statements by Certified Public Accountants and auditing standards generally accepted in the Republic of China. Those rules and standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Asia Cement Corporation as of December 31, 2009 and 2008, and the results of its operations and its cash flows for the years then ended, in conformity with the Guidelines Governing the Preparation of Financial Reports by Securities Issuers, requirements of the Business Accounting Law and Guidelines Governing Business Accounting relevant to financial accounting standards, and accounting principles generally accepted in the Republic of China. As disclosed in Note 3 to the financial statements, the Corporation adopted Interpretation No. 2007-052 issued by the Accounting Research and Development Foundation of the Republic of China in March 2007 and recognized as compensation expenses bonuses to employees and remuneration to directors and supervisors beginning January 1, 2008. These bonuses and remuneration were previously recorded as appropriations from earnings, On January 1, 2009, the Corporation adopted the newly revised SFAS No. 10 , “Accounting for Inventories”. We have also audited the consolidated financial statements of Asia Cement Corporation as of and for the years ended December 31, 2009 and 2008, and have issued an modified unqualified report respectively, also dated March 5, 2010 (not presented herewith). March 5, 2010

Notice to Readers

The accompanying financial statements are intended only to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in the Republic of China and not those of any other jurisdictions. The standards, procedures and practices to audit such financial statements are those generally accepted and applied in the Republic of China.

For the convenience of readers, the auditors’ report and the accompanying financial statements have been translated into English from the original Chinese version prepared and used in the Republic of China. If there is any conflict between the English version and the original Chinese version or any difference in the interpretation of the two versions, the Chinese-language auditors’ report and financial statements shall prevail.

NONCONSOLIDATED BALANCE SHEETS DECEMBER 31, 2009 AND 2008 (In Thousands of New Taiwan Dollars, Except Par Value)

2009 2008 ASSETS Amount % Amount %

CURRENT ASSETS Cash $ 8,025,183 7 $ 4,031,705 4 Financial assets at fair value through profit or loss - current 161,200 - 92,600 - Available-for-sale financial assets - current 1,086,145 1 1,061,945 1 Notes receivable 221,871 - 192,545 - Accounts receivable Affiliates 319,279 - 412,125 - Third parties, net of allowance for doubtful accounts - 2009: $7,272 thousand, 2008: $10,400 thousand 340,493 1 711,071 1 Other receivables 75,311 - 80,271 - Inventories 1,698,518 2 2,127,341 3 Hedging derivative financial assets - current - - 12,928 - Others 178,864 - 191,736 -

Total current assets 12,106,864 11 8,914,267 9

LONG-TERM INVESTMENTS Investments accounted for using equity method 82,161,470 74 72,852,269 75 Available-for-sale financial assets - noncurrent 5,312,124 5 2,922,190 3 Financial assets carried at cost - noncurrent 386,613 - 577,845 1

Total long-term investments 87,860,207 79 76,352,304 79

PROPERTIES AND EQUIPMENT Cost Land 225,766 - 225,766 - Buildings and improvements 2,977,144 3 2,951,497 3 Machinery and equipment 14,535,014 13 14,181,444 15 Other equipment 1,043,287 1 1,032,520 1 Total cost 18,781,211 17 18,391,227 19 Revaluation increment 1,065,187 1 1,082,320 1 Total cost and revaluation increment 19,846,398 18 19,473,547 20 Less: Accumulated depreciation 17,838,166 16 17,751,869 18 Construction in progress and prepayments on equipment 327,434 - 952,834 1

Net properties and equipment 2,335,666 2 2,674,512 3

OTHER ASSETS Nonoperating properties, net 6,429,658 6 6,463,693 7 Deferred charges, net 1,227,579 1 1,028,253 1 Miscellaneous 919,151 1 988,573 1

Total other assets 8,576,388 8 8,480,519 9

TOTAL $ 110,879,125 100 $ 96,421,602 100

Financial Information

2009 2008 LIABILITIES AND STOCKHOLDERS’ EQUITY Amount % Amount %

CURRENT LIABILITIES Short-term loans $ - - $ 750,000 1 Short-term bills payable - - 199,395 - Accounts payable and accrued expenses 1,406,273 1 1,323,010 2 Income tax payable 121,638 - 186,053 - Financial liabilities at fair value through profit or loss - current 311,723 1 126,897 - Dividends and bonuses payable 202,647 - 202,369 - Customers’ deposits and advances 85,735 - 233,658 - Current portion of long-term liabilities 9,869,270 9 2,100,000 2

Total current liabilities 11,997,286 11 5,121,382 5

LONG-TERM LIABILITIES, NET OF CURRENT PORTION Bonds payable 7,000,000 6 10,707,945 11 Bank loans 13,744,595 13 12,661,142 13

Total long-term liabilities 20,744,595 19 23,369,087 24

RESERVE FOR LAND VALUE INCREMENT TAX 1,443,866 1 1,443,866 2

OTHER LIABILITIES Deferred income 1,495,021 1 1,562,725 2 Miscellaneous 113,326 - 84,447 -

Total other liabilities 1,608,347 1 1,647,172 2

Total liabilities 35,794,094 32 31,581,507 33

STOCKHOLDERS’ EQUITY Capital stock - $10 par value per share Authorized - 3,300,000 thousand shares Issued - 2009: 2,985,736 thousand shares, 2008: 2,898,772 thousand shares 29,857,355 27 28,987,723 30 Capital surplus 8,197,276 8 8,080,494 8 Retained earnings Legal reserve 9,391,500 8 8,679,226 9 Unappropriated 12,872,324 12 11,810,912 12 Total retained earnings 22,263,824 20 20,490,138 21 Other equity Cumulative translation adjustments 3,201,493 3 4,479,430 5 Net loss not recognized as pension cost (115,672) - (225,463) - Unrealized gains on financial instruments 8,894,624 8 241,642 - Unrealized revaluation increments 2,786,131 2 2,786,131 3 Total other equity 14,766,576 13 7,281,740 8

Total stockholders’ equity 75,085,031 68 64,840,095 67

TOTAL $ 110,879,125 100 $ 96,421,602 100

NONCONSOLIDATED STATEMENTS OF INCOME YEARS ENDED DECEMBER 31, 2009 AND 2008 (In Thousands of New Taiwan Dollars, Except Earnings Per Share)

2009 2008 Amount % Amount %

OPERATING REVENUE $ 10,007,669 100 $ 10,558,839 100

LESS: SALES RETURNS AND ALLOWANCES 45,517 - 43,368 -

NET OPERATING REVENUE 9,962,152 100 10,515,471 100

OPERATING COSTS 8,460,793 85 8,867,787 84

GROSS PROFIT 1,501,359 15 1,647,684 16

UNREALIZED GROSS PROFIT (382) - (2,519) -

NET GROSS PROFIT 1,500,977 15 1,645,165 16

OPERATING EXPENSES 600,344 6 615,852 6

OPERATING INCOME 900,633 9 1,029,313 10

NONOPERATING INCOME AND GAINS Equity in earnings of investee, net 7,694,554 77 6,304,921 60 Rental income 366,489 4 370,078 3 Dividends 222,633 2 354,467 3 Gain on valuation of financial assets, net 68,600 1 - - Interest 50,721 - 118,246 1 Gain on valuation of financial liabilities, net - - 582,986 6 Others 89,053 1 61,914 1

Total nonoperating income and gains 8,492,050 85 7,792,612 74

NONOPERATING EXPENSES AND LOSSES Interest 479,318 5 587,392 5 Loss on valuation of financial liabilities, net 184,826 2 - - Impairment loss on financial assets 177,711 2 - - Rental costs and expenses 169,399 2 173,445 2 Exchange loss, net - - 111,144 1 Loss on valuation of financial assets, net - - 90,200 1 Others 259,963 2 315,406 3

Total nonoperating expenses and losses 1,271,217 13 1,277,587 12

Financial Information

2009 2008 Amount % Amount %

INCOME BEFORE INCOME TAX 8,121,466 81 7,544,338 72

INCOME TAX EXPENSE 236,457 2 229,696 2

NET INCOME $ 7,885,009 79 $ 7,314,642 70

2009 2008 Before After Before After Income Income Income Income Tax Tax Tax Tax

EARNINGS PER SHARE Basic $ 2.72 $ 2.64 $ 2.53 $ 2.45 Diluted $ 2.71 $ 2.63 $ 2.52 $ 2.44

NONCONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY YEARS ENDED DECEMBER 31, 2009 AND 2008 (In Thousands of New Taiwan Dollars, Except Per Share Amounts)

Capital Stock Capital Surplus Issued and Outstanding Long-term Legal Shares Amount Donations Investments Total Reserve

BALANCE, JANUARY 1, 2008 2,734,690,863 $ 27,346,909 $ 41,790 $ 6,844,049 $ 6,885,839 $ 7,672,810

Appropriation of 2007 earnings Legal reserve - - - - - 1,006,416 Cash dividends - $2.4 per share ------Stock dividends - $0.6 per share 164,081,451 1,640,814 - - - - Remuneration to directors and supervisors ------Employees bonuses ------

Balance after appropriation 2,898,772,314 28,987,723 41,790 6,844,049 6,885,839 8,679,226

Adjustments due to change in investee's equity - - - 395,484 395,484 -

Effect of change in ownership percentage due to investees' issuance of capital stock for cash - - - 799,171 799,171 -

Translation adjustments on long-term equity investments ------

Net income in 2008 ------

Adjustments due to change in unrealized losses on available-for-sale financial assets ------

Adjustments due to change in unrealized gains of cash flow hedge ------

BALANCE, DECEMBER 31, 2008 2,898,772,314 28,987,723 41,790 8,038,704 8,080,494 8,679,226

Appropriation of 2008 earnings Legal reserve - - - - - 712,274 Cash dividends - $1.8 per share ------Stock dividends - $0.3 per share 86,963,169 869,632 - - - -

Balance after appropriation 2,985,735,483 29,857,355 41,790 8,038,704 8,080,494 9,391,500

Adjustments due to change in investee's equity - - - 116,782 116,782 -

Translation adjustments on long-term equity investments ------

Net income in 2009 ------

Adjustments due to change in unrealized gains on available-for-sale financial assets ------

Adjustments due to change in unrealized losses of cash flow hedge ------

BALANCE, DECEMBER 31, 2009 2,985,735,483 $ 29,857,355 $ 41,790 $ 8,155,486 $ 8,197,276 $ 9,391,500

Note: The remuneration to directors and supervisors of $196,368 thousand and the bonuses to employees of $261,825 thousand have been expensed and deducted from 2009 earnings.

Financial Information

Unrealized Gains (Losses) of Financial Instruments Unrealized Gains (Losses) Unrealized Retained Earnings Cumulative Net Loss Not on Available-for- Gains (Losses) Unrealized Total Translation Recognized as sale Financial of Cash Flow Revaluation Stockholders’ Unappropriated Total Adjustments Pension Cost Assets Hedge Total Increments Equity

$ 14,516,179 $ 22,188,989 $ 2,494,245 $ (78,026 ) $ 10,713,718 $ (18,014 ) $ 10,695,704 $ 2,786,131 $ 72,319,791

(1,006,416 ) ------(6,563,258 ) (6,563,258 ) ------(6,563,258 ) (1,640,814 ) (1,640,814 ) ------(264,648 ) (264,648 ) ------(264,648 ) (352,863 ) (352,863 ) ------(352,863 )

4,688,180 13,367,406 2,494,245 (78,026 ) 10,713,718 (18,014 ) 10,695,704 2,786,131 65,139,022

(191,910 ) (191,910 ) 599,184 (147,437 ) (7,285,803 ) - (7,285,803 ) - (6,630,482 )

------799,171

- - 1,386,001 - - - - - 1,386,001

7,314,642 7,314,642 ------7,314,642

- - - - (3,200,369 ) - (3,200,369 ) - (3,200,369 )

- - - - - 32,110 32,110 - 32,110

11,810,912 20,490,138 4,479,430 (225,463 ) 227,546 14,096 241,642 2,786,131 64,840,095

(712,274 ) ------(5,217,790 ) (5,217,790 ) ------(5,217,790 ) (869,632 ) (869,632 ) ------

5,011,216 14,402,716 4,479,430 (225,463 ) 227,546 14,096 241,642 2,786,131 59,622,305

(23,901 ) (23,901 ) (674,237 ) 109,791 6,246,724 1,820 6,248,544 - 5,776,979

- - (603,700 ) - - - - - (603,700 )

7,885,009 7,885,009 ------7,885,009

- - - - 2,414,134 - 2,414,134 - 2,414,134

- - - - - (9,696 ) (9,696 ) - (9,696 )

$ 12,872,324 $ 22,263,824 $ 3,201,493 $ (115,672 ) $ 8,888,404 $ 6,220 $ 8,894,624 $ 2,786,131 $ 75,085,031

NONCONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED DECEMBER 31, 2009 AND 2008 (In Thousands of New Taiwan Dollars)

2009 2008

CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 7,885,009 $ 7,314,642 Adjustments to reconcile net income to net cash provided by operating activities: Equity in earnings of investee, net (7,694,554) (6,304,921) Cash dividends received from equity-method investees 3,558,632 5,900,094 Depreciation 344,201 224,603 Amortization 252,775 215,330 Impairment loss on financial assets carried at cost 177,711 - Unrealized foreign exchange (gains) losses on euro exchangeable bonds (170,100) 265,650 Amortization of discount on euro exchangeable bonds 161,809 139,491 Realized deferred income (68,086) (68,085) Deferred income taxes 16,110 3,263 Others 22,209 18,394 Net changes in operating assets and liabilities: Financial assets held for trading (68,600) 90,200 Notes receivable (29,326) 31,655 Accounts receivable 460,296 (286,186) Other receivables 4,960 14,322 Inventories 428,823 (690,843) Other current assets 19,966 29,744 Accounts payable and accrued expenses 83,263 481,920 Income tax payable (64,415) 24,025 Financial liabilities held for trading 184,826 (582,986) Customers’ deposits and advances (147,923) 155,447 Accrued pension cost 3,192 (103,547)

Net cash provided by operating activities 5,360,778 6,872,212

CASH FLOWS FROM INVESTING ACTIVITIES Acquisition of properties and equipment and nonoperating properties (310,020) (639,304) Increase in deferred charges (114,972) (204,018) Decrease (increase) in miscellaneous assets 62,453 (30,279) Proceeds from disposal of properties and equipment 170 - Acquisition of equity method investments - (1,778,497) Decrease in other notes payable - (1,292,000) Increase in financial assets carried at cost - (118,003) Proceeds from investees' capital return - 67,673

Net cash used in investing activities (362,369) (3,994,428)

(Continued)

Financial Information

2009 2008 CASH FLOWS FROM FINANCING ACTIVITIES Increase in long-term liabilities 15,506,346 14,833,566 Repayments of long-term liabilities (10,353,277) (8,354,531) Cash dividends paid (5,217,512) (6,562,998) (Decrease) increase in short-term loans (750,000) 740,000 (Decrease) increase in short-term bills payable (199,395) 199,395 Increase (decrease) in miscellaneous liabilities 8,907 (648) Bonus paid to employees and remuneration paid to directors and supervisors - (549,463)

Net cash (used in) provided by financing activities (1,004,931) 305,321

NET INCREASE IN CASH 3,993,478 3,183,105

CASH, BEGINNING OF YEAR 4,031,705 848,600

CASH, END OF YEAR $ 8,025,183 $ 4,031,705

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Interest paid (excluding capitalized interest) $ 309,739 $ 449,073 Income taxes paid $ 284,762 $ 202,408

NONCASH INVESTING AND FINANCING ACTIVITIES Current portion of long-term liabilities $ 9,869,270 $ 2,100,000

Notes of Financial Statements: Please refer to Attachment I

Consolidated Financial Statements: Please refer to Attachment II

The Company and its affiliates have not experienced financial difficulties in the most recent fiscal year or during the current fiscal year up to the printing date of the annual report.

80 Analysis of Financial Status, Operating Results and Risk Management

VII. ANALYSIS OF FINANCIAL STATUS, OPERATING RESULTS, AND RISK MANAGEMENT

7.1 Analysis of Financial Status UNIT: NT$1,000 Year Variance 2008 2009 Item Amount % Current Assets 8,914,267 12,106,864 3,192,597 36 Long-term 76,352,304 87,860,207 11,507,903 15 Investments Properties and 2,674,512 2,335,666 (338,846) (13) Equipment Other Assets 8,480,519 8,576,388 95,869 1 Total Assets 96,421,602 110,879,125 14,457,523 15 Current Liabilities 5,121,382 11,997,286 6,875,904 134 Long-Term Liabilities 23,369,087 20,744,595 (2,624,492) (11) Reserve for Land Value 1,443,866 1,443,866 - - Increment Tax Other Liabilities 1,647,172 1,608,347 (38,825) (2) Total Liabilities 31,581,507 35,794,094 4,212,587 13 Capital Stock 28,987,723 29,857,355 869,632 3 Capital Surplus 8,080,494 8,197,276 116,782 1 Retained Earnings 20,490,138 22,263,824 1,773,686 9 Other Adjustments of 7,281,740 14,766,576 7,484,836 103 Stockholders’ Equity Total Stockholders’ 64,840,095 75,085,031 10,244,936 16 Equity Analysis of deviation over 20%: 1. The increase of current assets was mainly due to the increase of bank deposit. 2. The increase of current liabilities was mainly due to reclassify EEB (Euro Exchangeable Bond) from long-term liabilities into “current portion of long-term liabilities”. 3. The major reason of the increase of “other adjustments of stockholders’ equity” was due to the increase from “unrealized gains on financial instruments” followed by SFAS No. 34.

7.2 Analysis of Operating Results UNIT: NT$1,000 Year Variance 2008 2009 Incr.(Decr.) (％) Item Net Operating Revenue 10,515,471 9,962,152 (553,319) (5) Operating Costs 8,867,787 8,460,793 (406,994) (5) Gross Profit 1,647,684 1,501,359 (146,325) (9) Less: Unrealized Gross Profit (2,519) (382) 2,137 (85) Net Gross Profit 1,645,165 1,500,977 (144,188) (9) Operating Expenses 615,852 600,344 (15,508) (3) Operating Income 1,029,313 900,633 (128,680) (13) Non Operating Income and Gains 7,792,612 8,492,050 699,438 9 Non Operating Expenses and Losses 1,277,587 1,271,217 (6,370) (0) Income Before Income Tax 7,544,338 8,121,466 577,128 8 Income Tax Expense 229,696 236,457 6,761 3 Net Income 7,314,642 7,885,009 570,367 8 1. Analysis of deviation over 20%: The decrease of “unrealized gross profit” was due to the unrealized profit with the related parties realized in 2009. 2. For 2010, expected sales volume of domestic cement, 2.64 million MT, export cement, 1.9 million MT. Expected sales volume of domestic clinker, 0.1 million MT, export clinker, 0.5 million MT. Total sales volume will be 5.14 million MT, which is higher than 2009.

82 Analysis of Financial Status, Operating Results and Risk Management

7.3 Analysis of Cash Flow UNIT:NT$1,000 Plan of Funding for The Cash Inflows The Cash Cash Balance, Cash Outflows Cash Shortage from Operating Surplus Beginning of 2009 for full year 2009 Investing Financing Activities for 2009 (Deficit) Plans Plans 4,031,705 5,360,778 1,367,300 8,025,183 - - 1. The Analysis for Changing of Cash Flow for the Year: (1) Operating Activities: The Net Cash Inflows from Operating Activities mainly came from Cash Dividends of NT$3,558,632,000 of Equity-Method Investees. (2) Investing and Financing Activities: Mostly for Payout NT$5,217,512,000 as Cash Dividends and Net Increase NT$4,203,674,000 for loans. 2. Plan of Funding for Cash Shortage: (1) Plan of Funding for Cash Shortage & Liquidity Analysis: Not Applicable. (2) Liquidity Analysis: Please Refer to the List Below. Item 2008 2009 Variance (%) Cash Flow Ratio 134.19 44.68 (67) Cash Flow Adequacy Ratio 139.43 121.87 (13) Cash Reinvested Ratio 0.28 0.12 (57) Liquidity Analysis for 2010: Expected Net Cash Plan of Funding for Cash Cash Balance, Expected Total Expected Cash Inflows from Shortage Beginning of Cash Outflows Surplus Operating Investing Financing 2010 for 2010 (Deficit) Activities for 2010 Plans Plans 8,025,183 3,899,163 9,154,237 2,770,109 - -

7.4 Impacts of Major Capital Expenditures on Finance and Operation 7.4.1 Major Capital Expenditures and Funding Sources UNIT: NT$1,000 Actual or Actual or Actual or Expected Capital Expenditures Total Expected Expected Projects Capital Source of Date of Amount 2006 2007 2008 2009 2010 2011 Capital Completion Reform project of kiln #1 Retained 2009/12/31 545,782 12,788 83,426 346,983102,585 - - in Hualien Plant Earnings Reform project of kiln #2 Retained 2011/4/30 542,835 - - - - 492,83550,000 in Hualien Plant Earnings

7.4.2 Expected Benefit to Finance and Operation from the Major Capital Expenditure To increase clinker production and reduce coal and power consumption which is benefit to finance and operation.

7.5 Investment Strategies in the Most Recent Year, the Major Reasons for its Gain or Loss and Improvement Plan and Investment Plans for Next Year The company did not engage in any long-term investments in the most recent year.

7.6 Analysis and Evaluation of Risk Management 7.6.1 The Impact from Fluctuation of Foreign Exchange and Interest Rates, and Inflation on the Company’s Profit and Loss and Its Countermeasures ※Foreign exchange impact: Foreign exchange rate fluctuates because of the variation from market demand and supply volatility. Thus, the risk of foreign exchange may occur to the Company by means of various trading from the Company. For the Company, most of the procurements of raw materials were disbursed in USD; foreign sales were collected in USD. Currently, the USD cash collection was slightly less than the disbursement, which is natural hedge, to minimize the impact of fluctuation of foreign exchange on the Company’s profit and loss. Besides natural hedge, to minimize the risk of foreign exchange, the Company adopts measures against the uncertainty: (1) Monitor the impact to foreign exchange rate from global macro economic change and build up an necessary hedge mechanism. (2) Plan future demand for foreign currencies and gradually establish the needed foreign currency position to reduce overall cost. Convert weaker currencies to strong currencies.

84 Analysis of Financial Status, Operating Results and Risk Management

※ Interest rate impact: The interest expenses for year 2009 and 1Q10 amounted to NT$479,318,000 and NT$132,503,000, respectively; the average borrowing rate was 1.39% in 2009 and 1.39% in 1Q10, which was far lower than those of other local enterprises. The ratio of interest expenses to net sales was 4.81% in 2009 and 5.66% in 1Q10. In 2010, the Company intends to repay some portion of higher-cost mid/long term debt and corporate bonds, accompanied with the increasing sales revenue, the ratio is expected to be lower. In order to lock lower funding cost, the Company issued 1st unsecured corporate bond on February 5, 2010. It can reduce interest expense and fulfill working capital. Additionally, the financial structure can be improved to comply with the principle for long-term sustainable operation for corporations. ※ Inflation rate impact: Taiwan inflation rate was about 0.87% in 2009. This inflation rate did not have substantial effect on company’s operation and profit. 7.6.2 The Impact of Highly Risky/Leveraged Transaction, Loaning to Others, Endorsement and Guarantee for Others, and Derivatives The Company has no highly risky, leveraged transactions, and loanings to others in recent fiscal year. The endorsement and guarantee are made pursuant to “the Procedures for Endorsement and Guarantee”. The balance amount of endorsement and guarantee was NT$7,212,345,000 by the end of 2009, and NT$ 6,685,363,000 by the end of April 2010. The Company undertook CCS contracts and its balance amount was NT $2,606,820,000 by the end of 2009 (fair value was NT$ 2,564,446,000) and NT $2,606,820,000 by the end of April 2010 (fair value was NT$ 2,520,422,000). Based on conservative operating policy, the operations of subsidiaries bring considerable income to the Company. Besides, the Company supervises its subsidiaries regularly and controls the related risks. ◎R&D project and estimated expenditures in the future: Cement industry is quite mature, and its products are steady. The Company has no special R&D projects and related expenditures in the future. However, to pursue higher quality of ACC products, the R&D project can be proceeded without budget limits subject to demand basis. ◎Effect on the Company’s finance and operation from any changes in major policies and laws at home and abroad in the most recent fiscal year: None. ◎Effect on the Company's finance and operation due to the technological improvement and the change of industrial environment in the most recent fiscal year: None.

◎Events influencing the Company's corporate image in the most recent fiscal year: None. ◎Merger or acquisition plan in the most recent fiscal year: None. ◎Plan of expanding capicity in the most recent fiscal year: None. ◎Supply and sale of the Company in the most recent fiscal year: Normal and steady. ◎Large volume shares transferred or changed by directors, supervisors, or shareholders with more than 10% shareholdings in the most recent fiscal year: None. ◎Change of the Company’s management in the most recent fiscal year: None. ◎Litigation, non-litigation incidents or administrative disputes of directors, supervisors, president, shareholders with more than 10% shareholdings, or subsidiaries which could materially affect shareholders' equity or the prices of the Company's securities: None. ◎Other major risks: None.

VIII . SPECIAL DISCLOSURE 8.1 Information about Affiliated Companies

8.1.1 Organizational Chart of Affiliated Companies100.00%

98.06% ASIA ENGINEERING ASIA ENGINEERING ENTERPRISE CORP. ENTERPRISES PTE. LTD.

69.98% 100.00% 99.99% YA TUNG READY-MIXED YA SING READY-MIXED NANCHANG YALI CONCRETE CONCRETE CORP. CONCRETE CORP. PRODUCE LTD.

51.99% JIANGXI YALI TRANSPORT CO., LTD. 100.00% 99.96% ASIA CONTINENT INVESTMENT 85.00% JIANGXI YADONG CEMENT CO., NAN HWA CEMENT CORP. 50.00% HOLDINGS PTE. LTD. LTD. 10.00% NANCHANG YADONG CEMENT CO., LTD. 25.00%

99.83% FU MING TRANSPORTATION 99.90% FU DA TRANSPORTATION CO., 90.00% HUANGGANG YADONG CEMENT CO., LTD. LTD. CO., LTD. 10.00%

90.00% 100.00% WUHAN YADONG CEMENT CO., WUHAN YALI CONCRETE 100.00% LTD. PRODUCE CO., LTD. 99.96%

87 ASIA CEMENT(SINGAPORE)PTE.LTD. ORIENTAL CONCRETE PTE.LTD. 10.00% 100.00% ASIA CEMENT ORIENTAL HOLDINGS CO., LTD. CORP. 4.10% 51.22% 48.78% 68.19% ASIA CEMENT (CHINA) 100.00% PERFECT INDUSTRIAL CHENGDU YALI CEMENT 48.00% HOLDINGS CO. HOLDINGS PTE. LTD. PRODUCTS CO.,LTD. ORIENTAL INDUSTRIAL HOLDINGS PTE. LTD. SHANGHAI YAFU CEMENT 99.99% 50.00% PRODUCTS CO., LTD. 15.00% 100.00% SUNRISE INDUSTRIAL 35.00% HOLDINGS LTD. 100.00% 90.00% SHANGHAI YALI CEMENT 10.00% 49.00% KOWLOON CONCRETE CORP. PRODUCTS CO., LTD. KOWLOON CEMENT CORP. LTD. LTD. 90.00% 99.99% SICHUAN YALI CONCRETE 10.00% DER CHING INVESTMENT CORP. PRODUCE CO., LTD.

99.49% FU SHAN MINERAL STONE CO., 90.00% SICHUAN YALI TRANSPORT CO., LTD. 10.00% LTD. Special Disclosure 83.81% YA LI PRECAST PRESTRESSED 99.90% YA LI PRECAST PRESTRESSED CONCRETE CONCRETE INDUSTRIES CORP. INDUSTRIES CORP. LTD. DELHI BRANCH 90.00% YANGZHOU YADONG CEMENT 10.00% CO., LTD.

90.00% HUBEI YADONG CEMENT 59.59% 10.00% CHIAHUI POWER CORP. CO.,LTD. 100.00% 100.00 ASIA CEMENT EXPLORER HUBEI YALI TRANSPORT CO., % INVESTMENT LTD. LTD. 100.00% 0.01% ASIA INVESTMENT CORP. 92.44% SICHUAN YADONG CEMENT CO., 7.56% LTD. 100.00% ASIA CEMENT PIONEER INVESTMENT LTD.

51.00% YUAN LONG STAINLESS STEEL CORP.

8.2 Basic Information of Affiliates Currency: NTD (except otherwise specified) Unit: $1,000 Up to December 31, 2009 Establishing Paid-in Main business or Production Company Name Date Capital Item ASIA ENGINEERING ENTERPRISE CORP. Address：No.125, Xinxing Rd., Xincheng Nov. 1982 67,620 Engineering Township, Hualien County YA TUNG READY-MIXED CONCRETE CORP. Ready-mixed concrete, Address：No.139, Sec. 1, Datong Rd., Xizhi Jan. 1999 1,193,839 City, Taipei County Cement products NAN HWA CEMENT CORP. Granulated Blast-Furnace Slag, Address：31F., No.207, Sec. 2, Dunhua S. Rd., May. 1979 261,440 Da’an Dist., Taipei City Cement, Limestone Slag FU MING TRANSPORTATION CO., LTD. Address：No.139, Sec. 1, Datong Rd., Xizhi Feb. 1980 295,695 Transportation City, Taipei County ASIA CEMENT (SINGAPORE) PTE. LTD. Address：5 Little Road #09-01 Cemtex SGD Apr. 1964 Cement Industrial Building Singapore 10,500 536983 ASIA CEMENT (CHINA) HOLDINGS CO. Address：Century Yard,Cricket HKD Square,Hutchins Drive,P.O. Box Apr. 2004 Investment 155,625 2681GT, George Town,Grand Cayman,British West Indies SUNRISE INDUSTRIAL HOLDINGS LTD. Address：CITCO Building, Wickhams USD Cay,P.O.Box 662,Road Apr. 1996 Investment 90 Town ,Tortola, British Virgin Islands DER CHING INVESTMENT CORP. Address：31F., No.207, Sec. 2, Dunhua S. Rd., Dec. 1988 5,201,161 Investment Da’an Dist., Taipei City YA LI PRECAST PRESTRESSED CONCRETE INDUSTRIES CORP. May. 1991 193,776 Cement products Address：No.3, Sec. 2, Jiayuan Rd., Shulin City, Taipei County CHIAHUI POWER CORP. Address：No.688, Songzijiao, Minxiong Apr. 1996 4,700,000 Power plant Township, Chiayi County ASIA INVESTMENT CORP. Address：31F., No.207, Sec. 2, Dunhua S. Rd., Oct. 1998 Investment 1,181,450 Da’an Dist., Taipei City YUAN LONG STAINLESS STEEL CORP. Steel rolling and related Address：No.28, Daye S. Rd., Xiaogang Dist., Dec. 2005 2,000,000 Kaohsiung City business ASIA ENGINEERING ENTERPRISES PTE. LTD. Address：CITCO Building, Wickhams USD Cay,P.O.Box 662,Road June. 1995 Engineering 50 Town ,Tortola, British Virgin Islands YA SING READY-MIXED CONCRETE CORP. Ready-mixed concrete, Address：No.350, Niupu S. Rd., Xiangshan Apr. 2000 100,000 Dist., Hsinchu City Cement products

88 Special Disclosure

Establishing Paid-in Main business or Production Company Name Date Capital Item FU DA TRANSPORTATION CO., LTD. Address：No.139, Sec. 1, Datong Rd., Xizhi Feb. 1989 195,437 Transportation City, Taipei County ORIENTAL CONCRETE PTE. LTD. Address：5 Little Road #09-01 Cemtex SGD Oct. 1980 Ready-mixed concrete Industrial Building Singapore 17,000 536983 PERFECT INDUSTRIAL HOLDINGS PTE. LTD. Address：CITCO Building, Wickhams USD Cay,P.O.Box 662,Road May. 1997 Investment 6,943 Town ,Tortola, British Virgin Islands KOWLOON CEMENT CORP. LTD. Address：11/F Lippo Leighton Tower, 103 HKD Sept. 1986 Cement Leighton Road, Causeway Bay, 23,000 Hong Kong FU SHAN MINERAL STONE CO., LTD. Address：No.125, Xinxing Rd., Xincheng Dec. 1970 13,000 Marble, Limestone Mining Township, Hualien County YA LI PRECAST PRESTRESSED CONCRETE INDUSTRIES CORP.LTD.DELHI BRANCH INR June. 2007 Cement products Address：7/241,2nd Floor, Sunder Vihar, 1,000 Paschim Vihar, New Delhi-110087 ASIA CEMENT EXPLORER INVESTMENT. LTD. Address：Wickhams Cay,P.O.Box 662,Road USD Aug. 2008 Investment Town ,Tortola, British Virgin 65 Islands ASIA CEMENT PIONEER INVESTMENT. LTD. Address：Wickhams Cay,P.O.Box 662,Road USD Aug. 2008 Investment Town ,Tortola, British Virgin 50 Islands ASIA CONTINENT INVESTMENT HOLDINGS PTE. LTD. SGD Address：5 Little Road #09-01 Cemtex Apr. 1995 Investment 280,456 Industrial Building Singapore 536983 ORIENTAL INDUSTRIAL HOLDINGS PTE. LTD. Address：5 Little Road #09-01 Cemtex SGD May. 1994 Investment Industrial Building Singapore 672,310 536983 KOWLOON CONCRETE CORP. LTD. Address：11/F Lippo Leighton Tower, 103 HKD Ready-mixed concrete, Mar. 1992 Leighton Road, Causeway Bay, 10 Cement products Hong Kong JIANGXI YADONG CEMENT CO., LTD. Address：Changjiang Road,Jiujiang Economic USD Cement, Cement products, Oct. 1997 Development Zone,Jiujiang 221,104 Ready-mixed concrete City,Jiangxi Province, China HUANGGANG YADONG CEMENT CO., LTD. USD Cement, Cement products, Address：5 Tiyu Avenue,Huangzhou Zone， Aug. 2006 50,450 Ready-mixed concrete Huanggang City, Hubei Province, China WUHAN YADONG CEMENT CO., LTD. Address：Cihui Avenue,Wujiashan Taiwan USD Cement, Slag-Cement, Nov. 1999 Business Investment 36,140 Granulated blast-furnace slag Zone,Dongxihu,Wuhan,China

Establishing Paid-in Main business or Production Company Name Date Capital Item ORIENTAL HOLDINGS CO., LTD. USD Address：Room 305A,No 2875,South Yanggao July. 2003 Investment, Consultant 62,000 Rd,Pudong New Area,Shanghai CHENGDU YALI CEMENT PRODUCTS CO., LTD. USD Ready-mixed concrete, Dec. 2004 Address：No.68 Anpeng Road, Pengzhou, 4,100 Cement products Chengdu City, Sichuan, P.R.C SHANGHAI YAFU CEMENT PRODUCTS CO., LTD. RMB Ready-mixed concrete, Jan. 2003 Address：No.3000 Longwu Road Minhang 21,000 Cement products Shanghai P.R.C SHANGHAI YALI CEMENT PRODUCTS CO., LTD. USD Ready-mixed concrete, Nov. 1995 Address：No.3000 Longwu Road Minhang 15,000 Cement products Shanghai P.R.C SICHUAN YALI CONCRETE PRODUCE CO., LTD. USD Ready-mixed concrete, Address：No.268,Three Passage,Wenquan Nov. 2005 3,300 Cement products Road Wenjiang District,Chendu City,Sichuan,P.R.C SICHUAN YALI TRANSPORT CO., LTD. USD Address：No.68 Anpeng Road, Pengzhou, May. 2006 Transportation 3,500 Chengdu City, Sichuan, P.R.C YANGZHOU YADONG CEMENT CO., LTD. Address：No.7 Gudu Road BaliTown, USD Cement, Clinker, Yangzhou Economic Development July. 2006 30,448 Ready-mixed concrete Zone Yangzhou City Jiangsu Province China HUBEI YADONG CEMENT CO., LTD. Address：No.66 Ya Dong Avenue,Pingjiang USD Cement, Ready-mixed concrete, West Road,Yangluo Economic June. 2005 115,700 Cement products DevelopmentZone,WuhanCity,Hub ei Province,China HUBEI YALI TRANSPORT CO., LTD. Address：Cihui Avenue,Wujiashan Taiwan RMB Oct. 2006 Transportation Business Investment 8,000 Zone,Dongxihu,Wuhan.China SICHUAN YADONG CEMENT CO., LTD. Clinker, Cement, Limestone, Address：No.66 AnPengRoad,Tianpeng Town, USD Nov. 2004 Cement products, Pengzhou,Chengdu 143,340 Ready-mixed concrete City,Sichuan,P.R.China NANCHANG YALI CONCRETE PRODUCE LTD. RMB Ready-mixed concrete, Address：Melin AVE Bashuihu Industries Zone Dec. 2003 60,000 Cement products Nanchang ETDZ Jiangxi Province JIANGXI YALI TRANSPORT CO., LTD. RMB Address：No.8,Yadong Ma-Toutown Ruichang May. 2000 Transportation 12,500 City Jiangxi China NANCHANG YADONG CEMENT CO., LTD. Address：Industrial 2nd Rd, Changdong RMB Cement, Clinker, Jan. 2004 Industrial Park, Nanchang JiangXi, 90,000 Ready-mixed concrete China WUHAN YALI CONCRETE PRODUCE CO., LTD. Address：No.66 Ya Dong Avenue,Pingjiang RMB Ready-mixed concrete, Dec. 2007 Went Road,Yangluo Economic 20,000 Cement products DevelopmentZone,Wuhan City,Hubei Province,China

90 Special Disclosure

8.3 The Main Business of Affiliates Please Refer to Above List. 8.4 Information of the Directors, Supervisors, and Presidents of ACC Affiliates Shareholding Company Name Title Name or Representative Shares % ASIA ENGINEERING Chairman Y.F.Chang (ACC Representative) 6,630,831 98.06 ENTERPRISE CORP. Director / President Z.P.Chang (ACC Representative) 6,630,831 98.06 Director K.Y.Lee (ACC Representative) 6,630,831 98.06 Director C.K.Chang (ACC Representative) 6,630,831 98.06 Director J.B.Yu (ACC Representative) 6,630,831 98.06 Director X.M.Guo (ACC Representative) 6,630,831 98.06 Director Z.F.Lin (ACC Representative) 6,630,831 98.06 Director J.C.Lin (ACC Representative) 6,630,831 98.06 Director Douglas Tong Hsu 13,041 0.19 Director Peter Hsu 5,681 0.08 Supervisor H.Z.He (ACC Representative) 6,630,831 98.06 YA TUNG Chairman / President K.Y.Lee (ACC Representative) 119,382,860 99.99 READY-MIXED Director Y.F.Chang (ACC Representative) 119,382,860 99.99 CONCRETE CORP. Director W.K.Chou (ACC Representative) 119,382,860 99.99 Director Douglas Tong Hsu 596 0.00 Director Peter Hsu 119 0.00 Supervisor R.H.Shao (ACC Representative) 119,382,860 99.99 Supervisor Doris Wu (ACC Representative) 119,382,860 99.99 NAN HWA CEMENT Chairman K.Y.Lee (ACC Representative) 26,132,827 99.96 CORP. President T.Z.Yang 0 0.00 Director Douglas Tong Hsu 1,548 0.00 Director T.H.Chang (ACC Representative) 26,132,827 99.96 Director C.M.Chen (ACC Representative) 26,132,827 99.96 Director Z.F.Lin (ACC Representative) 26,132,827 99.96 Director Y.F.Chang (ACC Representative) 26,132,827 99.96 Director Peter Hsu 1,548 0.00 Director C.H. Chiu (ACC Representative) 26,132,827 99.96 Director C.K.Chang (ACC Representative) 26,132,827 99.96 Director S.J.Lin (ACC Representative) 26,132,827 99.96 Supervisor W.H.Yeh (ACC Representative) 26,132,827 99.96 FU MING TRANSPOR- Chairman Johnny Shih (ACC Representative) 29,518,518 99.83 TATION CO., LTD. Director / President W.T.Hsu (ACC Representative) 29,518,518 99.83 Director K.Y.Lee (ACC Representative) 29,518,518 99.83 Director Y.F.Chang (ACC Representative) 29,518,518 99.83 Director R.H.Shao (ACC Representative) 29,518,518 99.83 Director B.Z.Cheng (ACC Representative) 29,518,518 99.83 Director Z.F.Lin (ACC Representative) 29,518,518 99.83 Supervisor T.L.Yu (ACC Representative) 29,518,518 99.83 Humphrey Cheng Supervisor 29,518,518 99.83 (ACC Representative)

Shareholding Company Name Title Name or Representative Shares % ASIA CEMENT Chairman / Douglas Tong Hsu 2 0.00 (SINGAPORE) PTE. LTD. Managing Director Vice Managing / J.H.Lin (ACC Representative) 10,495,495 99.96 Director Director T.H. Chang (ACC Representative) 10,495,495 99.96 Director K.Y.Lee (ACC Representative) 10,495,495 99.96 Director Y.F.Chang (ACC Representative) 10,495,495 99.96 Director R.H.Shao (ACC Representative) 10,495,495 99.96 Director Peter Hsu (ACC Representative) 10,495,495 99.96 Director C.P.Sue (ACC Representative) 10,495,495 99.96 ASIA CEMENT (CHINA) Chairman / HOLDINGS CO. Non-Executive Douglas Tong Hsu 0 0.00 Director Executive Director T.H. Chang 200,000 0.00 Executive Director R.H.Shao 40,000 0.00 Executive Director C.K.Chang 23,000 0.00 Executive Director S.J.Lin 0 0.00 Executive Director Z.L.Wu 0 0.00 Independent Non - Z.T.Liu 0 0.00 Executive Director Independent Non - Q.Z.Lei 0 0.00 Executive Director Independent Non - D.L.Zhan 0 0.00 Executive Director Independent Non - Y.H.Huang 0 0.00 Executive Director SUNRISE INDUSTRIAL Douglas Tong Hsu Director 90,000 100.00 HOLDINGS LTD. (ACC Representative) Director T.H. Chang (ACC Representative) 90,000 100.00 Director Peter Hsu (ACC Representative) 90,000 100.00 Director K.Y.Lee (ACC Representative) 90,000 100.00 Director R.H.Shao (ACC Representative) 90,000 100.00 DER CHING Chairman K.Y.Lee (ACC Representative) 520,069,685 99.99 INVESTMENT Director Peter Hsu 0 0.00 CORP. Director W.K.Chou (ACC Representative) 520,069,685 99.99 Director Y.F.Chang (ACC Representative) 520,069,685 99.99 Director T.H. Chang (ACC Representative) 520,069,685 99.99 Director R.H.Shao (ACC Representative) 520,069,685 99.99 Director Terry Cheng (ACC Representative) 520,069,685 99.99 Supervisor M.Wang (ACC Representative) 520,069,685 99.99 Supervisor H.T.Peng (ACC Representative) 520,069,685 99.99

92 Special Disclosure

Shareholding Company Name Title Name or Representative Shares % YA LI PRECAST Chairman K.Y.Lee (ACC Representative) 16,241,083 83.81 PRESTRESSED Director / President W.Yang (ACC Representative) 16,241,083 83.81 CONCRETE INDUSTRIES CORP. Director Y.F.Chang (ACC Representative) 16,241,083 83.81 Douglas Tong Hsu Director 16,241,083 83.81 (ACC Representative) Director Peter Hsu (ACC Representative) 16,241,083 83.81 Director T.Z.Yang (ACC Representative) 16,241,083 83.81 Director C.F.Cheng (FEGC Representative) 3,105,647 16.03 Supervisor H.S.Hsu (FEGC Representative) 3,105,647 16.03 Supervisor T.L.Yu (ACC Representative) 16,241,083 83.81 CHIAHUI POWER CORP. Douglas Tong Hsu Chairman 280,093,521 59.59 (ACC Representative) President C.L.Chen 0 0.00 Director Peter Hsu (ACC Representative) 280,093,521 59.59 Director K.Y.Lee (ACC Representative) 280,093,521 59.59 Kenichi Seshimo Director (J-Power Investment Netherlands B.V. 187,854,807 39.97 Representative) Chiharu Doi Director (J-Power Investment Netherlands B.V. 187,854,807 39.97 Representative) Supervisor R.H.Shao (ACC Representative) 280,093,521 59.59 Supervisor W.H.Yeh (ACC Representative) 280,093,521 59.59 ASIA INVESTMENT Chairman K.Y.Lee (ACC Representative) 118,145,000 100.00 CORP. Director Y.F.Chang (ACC Representative) 118,145,000 100.00 Director Y.M.Shin (ACC Representative) 118,145,000 100.00 Supervisor H.Y. Kao (ACC Representative) 118,145,000 100.00 YUAN LONG STAINLESS Chairman K.Y.Lee (ACC Representative) 102,000,000 51.00 STEEL CORP. President X.H.Chen 0 0.00 Director Peter Hsu (ACC Representative) 102,000,000 51.00 Director C.F.Cheng (ACC Representative) 102,000,000 51.00 Thomas Chou Director 98,000,000 49.00 (FEIB AMC Representative) H.Y.Wang Director 98,000,000 49.00 (FEIB AMC Representative) Supervisor Doris Wu (ACC Representative) 102,000,000 51.00 T.K.Hsieh Supervisor 98,000,000 49.00 (FEIB AMC Representative) ASIA ENGINEERING Director T.H.Chang 0 0.00 ENTERPRISES PTE. LTD. Director Y.F.Chang 0 0.00 Director Z.P.Chang 0 0.00

Shareholding Company Name Title Name or Representative Shares % YA SING READY-MIXED K.Y.Lee CONCRETE CORP. Chairman (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) J.H. Chiu Director / President (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) M.T.Chen Director (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) Z.K.Lee Director (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) S.Y.Huang Director (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) Z.G.He Director (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) C.T. Tsai Director (Nan Kung Enterprise Corp.Ltd. 1,000,000 10.00 Representative) J.B.Zhuo Director (Lien Fang Enterprise Corp.Ltd. 500,000 5.00 Representative) J.F. Tsai Director (Ho Hwei Enterprise Corp.Ltd. 500,000 5.00 Representative) F.C.Wu Supervisor (Chu Chiang Enterprise Corp.Ltd. 1,000,000 10.00 Representative) W.K.Chou Supervisor (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) J.M.Lin Supervisor (Ya Tung Ready-Mixed Concrete Corp. 6,998,000 69.98 Representative) FU DA Johnny Shih TRANSPORTATION CO., Chairman (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 LTD. Representative) President W.T. Hsu 0 0.00 J.M. Chou Director (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) W.Y.Yun Director (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) Y. X.Wu Director (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) K.Y. Lee Director (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) Humphrey Cheng Director (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) B.Z.Cheng Supervisor (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative) C.M.Shi Supervisor (Fu Ming Transportation Co., Ltd. 19,524,141 99.90 Representative)

94 Special Disclosure

Shareholding Company Name Title Name or Representative Shares % ORIENTAL CONCRETE Douglas Tong Hsu PTE. LTD. Chairman (Asia Cement (Singapore) Pte. Ltd. 17,000,000 100.00 Representative) J.H.Lin Director / (Asia Cement (Singapore) Pte. Ltd. 17,000,000 100.00 Managing Director Representative) K.Y.Lee Director (Asia Cement (Singapore) Pte. Ltd. 17,000,000 100.00 Representative) C.P.Sue Director (Asia Cement (Singapore) Pte. Ltd. 17,000,000 100.00 Representative) Peter Hsu Director (Asia Cement (Singapore) Pte. Ltd. 17,000,000 100.00 Representative) PERFECT INDUSTRIAL Director Douglas Tong Hsu 0 0.00 HOLDINGS PTE. LTD. Director T.H.Chang 0 0.00 KOWLOON CEMENT Chairman Douglas Tong Hsu 0 0.00 CORP. LTD. Director Johnny Shih 0 0.00 Director K.Y.Lee 0 0.00 Director Y.F.Chang 0 0.00 Director R.H.Shao 0 0.00 Director C.P.Sue 0 0.00 FU SHAN MINERAL Y.F.Chang (Der Ching Investment Corp. Chairman 1,293,410 99.49 STONE CO., LTD. Representative) Peter Hsu (Der Ching Investment Corp. Director 1,293,410 99.49 Representative) C.M.Chen (Der Ching Investment Corp. Director 1,293,410 99.49 Representative) Z.P.Chang (Der Ching Investment Corp. Director 1,293,410 99.49 Representative) Manfred Wang (Der Ching Investment Director 1,293,410 99.49 Corp. Representative) W.H.Yeh (Der Ching Investment Corp. Supervisor 1,293,410 99.49 Representative) YA LI PRECAST W.Yang PRESTRESSED Chairman (Ya Li Precast Prestressed Concrete 99,990 99.90 CONCRETE INDUSTRIES Industries Corp. Representative) CORP. LTD. X.M.He DELHI BRANCH Director (Ya Li Precast Prestressed Concrete 99,990 99.90 Industries Corp. Representative) W.H.Yeh Director (Ya Li Precast Prestressed Concrete 99,990 99.90 Industries Corp. Representative) Y.H. Kao Director (Ya Li Precast Prestressed Concrete 99,990 99.90 Industries Corp. Representative) Gary Lee Director (Ya Li Precast Prestressed Concrete 99,990 99.90 Industries Corp. Representative) P.E.Liu Director (Ya Li Precast Prestressed Concrete 99,990 99.90 Industries Corp. Representative)

Shareholding Company Name Title Name or Representative Shares % ASIA CEMENT C.M.Chen EXPLORER Director (Asia Investment Corp. 65,000 100.00 Representative) INVESTMENT LTD. W.K.Chou Director (Asia Investment Corp. 65,000 100.00 Representative) Doris Wu Director (Asia Investment Corp. 65,000 100.00 Representative) ASIA CEMENT PIONEER C.M.Chen INVESTMENT LTD. Director (Asia Investment Corp. 50,000 100.00 Representative) W.K.Chou Director (Asia Investment Corp. 50,000 100.00 Representative) Doris Wu Director (Asia Investment Corp. 50,000 100.00 Representative) ASIA CONTINENT Chairman Douglas Tong Hsu 0 0.00 INVESTMENT Director T.H.Chang 0 0.00 HOLDINGS PTE. LTD. Director Champion Lee 0 0.00 Director Peter Hsu 0 0.00 Director Y. F.Hu ang 0 0.00 ORIENTAL INDUSTRIAL Chairman T.H.Chang 2,000 0.00 HOLDINGS PTE. LTD. Director Douglas Tong Hsu 4,000 0.00 Director Peter Hsu 0 0.00 Director R.H.Shao 1,000 0.00 Director Wei Shing 0 0.00 KOWLOON CONCRETE Chairman Douglas Tong Hsu 0 0.00 CORP. LTD. Director K.Y.Lee 0 0.00 Director L.H.Fang 0 0.00 Director C.P.Sue 0 0.00 Director W.F.Leu 0 0.00 JIANGXI YADONG T.H.Chang CEMENT CO., LTD. Chairman (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) D.M.Yao *USD Vice Chairman (Jiangxi Provincial Investment 5.00 Group Corp. Representative) 11,055 Z.L.Wu Director / President (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) Douglas Tong Hsu Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) Peter Hsu Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative)

96 Special Disclosure

Shareholding Company Name Title Name or Representative Shares % C.K.Chang Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) Johnny Shih Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) R.H.Shao Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) Bernard Wu Director (Asia Continent Investment *USD 187,939 85.00 Holdings Pte. Ltd. Representative) HUANGGANG YADONG T.H. Chang *USD CEMENT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 45,405 Z.L.Wu *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 45,405 R.H.Shao *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 5,045 C.K.Chang *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 45,405 M.Y.Gao *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 45,405 J.C.Lin *USD Supervisor (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 45,405 WUHAN YADONG T.H. Chang *USD CEMENT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 C.K.Chang *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 S.J.Lin *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 Douglas Tong Hsu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 T.K.Hsieh *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 L.Tian *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 32,526 J.C.Lin *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 3,614 ORIENTAL HOLDINGS T.H. Chang *USD CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 R.H.Shao *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000

Shareholding Company Name Title Name or Representative Shares % Douglas Tong Hsu *USD Director (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 Bernard Wu *USD Director (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 Peter Hsu *USD Director (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 L.H.Fang *USD Director (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 T.K.Hsieh *USD Director (Oriental Industrial Holdings Pte. Ltd. 100.00 Representative) 62,000 CHENGDU YALI T.H. Chang *USD CEMENT PRODUCTS Chairman (Oriental Industrial Holdings Pte. Ltd. 51.22 Representative) 2,100 CO., LTD. J.B.Yu *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 51.22 Representative) 2,100 L.H.Fang *USD Director (Oriental Holdings Co., Ltd. 48.78 Representative) 2,000 C.K.Chang *USD Director (Oriental Industrial Holdings Pte. Ltd. 51.22 Representative) 2,100 S.X.Lee *USD Director (Oriental Industrial Holdings Pte. Ltd. 51.22 Representative) 2,100 Z.Y.Lin *USD Supervisor (Oriental Industrial Holdings Pte. Ltd. 51.22 Representative) 2,100 SHANGHAI YAFU T.H. Chang *RMB CEMENT PRODUCTS Chairman (Oriental Industrial Holdings Pte. Ltd. 50.00 Representative) 10,500 CO., LTD S.J.Lin *RMB Director / President (Shanghai Yali Cement Products 35.00 Co., Ltd. Representative) 7,350 R.H.Shao *RMB Director (Oriental Holdings Co., Ltd. 15.00 Representative) 3,150 Humphrey Cheng *RMB Director (Oriental Industrial Holdings Pte. Ltd. 50.00 Representative) 10,500 C.K.Chang *RMB Director (Oriental Industrial Holdings Pte. Ltd. 50.00 Representative) 10,500 SHANGHAI YALI T.H. Chang *USD CEMENT PRODUCTS Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500 CO., LTD. S.J.Lin *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500 L.H.Fang *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500

98 Special Disclosure

Shareholding Company Name Title Name or Representative Shares % Z.L.Wu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500 W.K.Chou *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500 Bernard Wu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 13,500 R.H.Shao *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 1,500 SICHUAN YALI T.H.Chang *USD CONCRETE PRODUCE Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 2,970 CO., LTD. J.B.Yu *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 2,970 L.H.Fang *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 330 Z.L.Wu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 2,970 W.K.Chou *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 2,970 SICHUAN YALI L.H.Fang *USD TRANSPORT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 3,150 C.P. Chang *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 3,150 J.H.Wu *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 350 J.B.Yu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 3,150 C.M.Chen *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 3,150 YANGZHOU YADONG T.H.Chang *USD CEMENT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 S.J.Lin *USD Director / President (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 R.H.Shao *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 3,045 Douglas Tong Hsu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 Peter Hsu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403

Shareholding Company Name Title Name or Representative Shares % W.F.Leu *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 C.K.Chang *USD Director (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 J.C.Lin *USD Supervisor (Oriental Industrial Holdings Pte. Ltd. 90.00 Representative) 27,403 HUBEI YADONG T.H.Chang CEMENT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) C.K.Chang Director / President (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) S.J.Lin Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) Douglas Tong Hsu Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) Peter Hsu Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) Y.F.Chang Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) Z.L.Wu Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) R.H.Shao *USD Director (Oriental Holdings Co., Ltd. 10.00 Representative) 11,570 Z.P.Chang Director (Oriental Industrial Holdings Pte. Ltd. *USD 104,130 90.00 Representative) Supervisor Doris Wu 0 0.00 HUBEI YALI C.K.Chang *RMB Chairman (Hubei Yadong Cement Co., Ltd. 100.00 TRANSPORT CO., LTD. 8,000 Representative) T.X.Nie *RMB Director / President (Hubei Yadong Cement Co., Ltd. 100.00 Representative) 8,000 H.Y.Han *RMB Director (Hubei Yadong Cement Co., Ltd. 100.00 Representative) 8,000 J.C.Lin *RMB Supervisor (Hubei Yadong Cement Co., Ltd. 100.00 Representative) 8,000 L.Tian *RMB Supervisor (Hubei Yadong Cement Co., Ltd. 100.00 Representative) 8,000 Y.S.Fang *RMB Supervisor (Hubei Yadong Cement Co., Ltd. 100.00 Representative) 8,000

100 Special Disclosure

Shareholding Company Name Title Name or Representative Shares % SICHUAN YADONG T.H.Chang CEMENT CO., LTD. Chairman (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) President L.H.Fang 0 0.00 C.K.Chang Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) Douglas Tong Hsu Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) Peter Hsu Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) Johnny Shih Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) Champion Lee Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) K.Y.Lee Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) R.H.Shao *USD Director (Oriental Holdings Co., Ltd. Representative) 10,834 7.56 Humphrey Cheng Director (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) J.C.Lin Supervisor (Oriental Industrial Holdings Pte. Ltd. *USD 132,506 92.44 Representative) NANCHANG YALI T.H.Chang *RMB CONCRETE PRODUCE Chairman (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 LTD. Z.L.Wu *RMB Director / President (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 S.J.Lin *RMB Director (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 J.C.Lin *RMB Director (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 X.M.Guo *RMB Director (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 Terry Cheng *RMB Supervisor (Jiangxi Yadong Cement Co., Ltd. 100.00 Representative) 60,000 JIANGXI YALI Z.L.Wu *RMB TRANSPORT CO., LTD. Chairman (Jiangxi Yadong Cement Co., Ltd. 51.99 Representative) 6,499 *RMB Director / President A.K.Fu 0.01 1 C.K.Chang *RMB Director (Jiangxi Yadong Cement Co., Ltd. 51.99 Representative) 6,499

101

Shareholding Company Name Title Name or Representative Shares % S.J.Lin *RMB Director (Jiangxi Yadong Cement Co., Ltd. 51.99 Representative) 6,499 C.L. Chang *RMB Director (Oriental Holdings Co., Ltd. 48.00 Representative) 6,000 Supervisor H.T.Peng 0 0.00 NANCHANG YADONG T.H.Chang *RMB CEMENT CO., LTD. Chairman (Jiangxi Yadong Cement Co., Ltd. 50.00 Representative) 45,000 J.Chang *RMB Vice Chairman (Fangda Special Steel Technology 25.00 Co., Ltd. Representative) 22,500 Terry Cheng *RMB Director / President (Oriental Holdings Co., Ltd. 25.00 Representative) 22,500 C.K.Chang *RMB Director (Jiangxi Yadong Cement Co., Ltd. 50.00 Representative) 45,000 S.J.Lin *RMB Director (Jiangxi Yadong Cement Co., Ltd. 50.00 Representative) 45,000 Z.L.Wu *RMB Director (Jiangxi Yadong Cement Co., Ltd. 50.00 Representative) 45,000 Z.P.Chang *RMB Director (Jiangxi Yadong Cement Co., Ltd. 50.00 Representative) 45,000 R.H.Shao *RMB Director (Oriental Holdings Co., Ltd. 25.00 Representative) 22,500 Y. D .P an *RMB Director (Fangda Special Steel Technology 25.00 Co., Ltd. Representative) 22,500 WUHAN YALI T.H.Chang *RMB CONCRETE PRODUCE Chairman (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 CO.,LTD. T.X.Nie *RMB Director / President (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 S.J.Lin *RMB Director (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 J.C.Lin *RMB Supervisor (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 S.X.Lee *RMB Supervisor (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 Y.S.Fang *RMB Supervisor (Wuhan Yadong Cement Co., Ltd. 100.00 Representative) 20,000 *The above companies marked with the “*” sign are not incorporated companies. Therefore the shareholding are shown in capital (Unit: USD and RMB $1,000) instead of shown in numbers of shares.

102 Special Disclosure

8.5 Affiliates' Operating Condition Unit:NT$1,000

Earnings(Loss) Operating Income (Loss) Total Per Share Company Name Capital Total Assets Net Value Net Sales Income (After Income Liabilities (After Income (Loss) Tax) Tax)

ASIA ENGINEERING 67,620 524,835 54,585 470,250 472,871 37,541 72,926 10.78 ENTERPRISE CORP.

YA TUNG READY-MIXED 1,193,839 2,555,898 1,175,930 1,379,968 5,653,339 179,633 125,576 1.05 CONCRETE CORP.

NAN HWA CEMENT CORP. 261,440 676,466 154,448 522,018 806,486 11,016 4,138 0.16

FU MING TRANSPORTATION CO., 295,695 1,212,464 110,999 1,101,465 539,788 33,548 139,957 4.73 LTD.

ASIA CEMENT 238,875 2,999,801 750,697 2,249,104 562,728 455 140,635 13.39 (SINGAPORE) PTE. LTD.

ASIA CEMENT (CHINA) 637,440 32,381,094 38,604 32,342,490 - (271,478) 3,012,789 1.94 HOLDINGS CO.

SUNRISE INDUSTRIAL 2,875 127,084 81,494 45,590 - (100) 517 5.75 HOLDINGS LTD.

DER CHING INVESTMENT 5,201,161 11,356,628 2,026,377 9,330,251 2,191,965 257,182 555,101 1.07 CORP.

YA LI PRECAST PRESTRESSED CONCRETE 193,776 436,334 350,386 85,948 611,386 (25,819) (52,812) (2.73) INDUSTRIES CORP.

CHIAHUI POWER CORP. 4,700,000 12,361,809 7,686,912 4,674,897 7,236,404 635,569 511,792 1.09

ASIA INVESTMENT CORP. 1,181,450 2,030,361 33,372 1,996,989 142,795 72,293 92,077 0.78

YUAN LONG STAINLESS 2,000,000 4,293,973 2,116,228 2,177,745 3,038,420 13,887 20,635 0.10 STEEL CORP.

ASIA ENGINEERING 1,597 89,598 34,099 55,499 498,590 4,923 23,399 467.98 ENTERPRISES PTE. LTD.

YA SING READY-MIXED 100,000 260,171 185,194 74,977 773,609 (28,375) (28,522) (2.85) CONCRETE CORP.

FU DA TRANSPORTATION 195,437 478,746 134,869 343,877 199,478 20,050 58,456 2.99 CO., LTD.

ORIENTAL CONCRETE PTE. 386,750 182,972 760 182,212 - (8,081) 4,297 0.25 LTD.

PERFECT INDUSTRIAL 221,753 29,822,689 1,022,080 28,800,609 - (179) 3,225,034 464.51 HOLDINGS PTE. LTD.

KOWLOON CEMENT CORP. 94,208 811,353 41,159 770,194 230,538 1,918 14,474 6.29 LTD.

FU SHAN MINERAL STONE 13,000 80,456 56,112 24,344 72,864 7,837 5,477 4.21 CO.,LTD.

103

Earnings(Loss) Operating Income (Loss) Total Per Share Company Name Capital Total Assets Net Value Net Sales Income (After Income Liabilities (After Income (Loss) Tax) Tax)

YA LI PRECAST PRESTRESSED CONCRETE 688 13,808 4,114 9,694 17,316 (844) (893) Note1 INDUSTRIES CORP.LTD.DELHI BRANCH

ASIA CEMENT EXPLORER 2,076 1,939 34,549 (32,610) - (35,787) (35,787) (550.57) INVESTMENT LTD.

ASIA CEMENT PIONEER 1,597 1,461 - 1,461 - (47) (47) (0.93) INVESTMENT LTD.

ASIA CONTINENT INVESTMENT HOLDINGS 6,380,378 8,287,807 107,007 8,180,800 - (227) 242,010 0.98 PTE. LTD.

ORIENTAL INDUSTRIAL 15,295,045 21,483,215 869,189 20,614,026 - (495) 2,983,011 5.83 HOLDINGS PTE. LTD.

KOWLOON CONCRETE 41 124,538 61 124,477 4,860 53 1,747 174.65 CORP. LTD.

JIANGXI YADONG CEMENT 7,062,062 17,474,375 7,952,286 9,522,089 6,549,076 411,055 304,681 Note1 CO., LTD.

HUANGGANG YADONG 1,611,373 6,624,932 5,050,420 1,574,512 124,269 (57,945) (107,556) Note1 CEMENT CO., LTD.

WUHAN YADONG CEMENT 1,154,312 2,855,621 984,201 1,871,420 3,660,661 256,796 195,090 Note1 CO., LTD.

ORIENTAL HOLDINGS CO., 1,980,280 3,361,505 223,222 3,138,283 - (2,061) 289,346 Note1 LTD.

CHENGDU YA LI CEMENT 130,954 420,948 151,704 269,244 597,338 72,966 60,710 Note1 PRODUCTS CO., LTD.

SHANGHAI YAFU CEMENT 81,128 569,496 495,036 74,460 573,283 30,834 17,943 Note1 PRODUCTS CO., LTD.

SHANGHAI YALI CEMENT 479,100 736,593 113,925 622,668 438,488 (71,805) (28,733) Note1 PRODUCTS CO., LTD.

SICHUAN YALI CONCRETE 105,402 364,496 223,356 141,140 217,737 (22,184) (8,385) Note1 PRODUCE CO., LTD.

SICHUAN YALI 111,790 213,806 19,855 193,951 158,376 41,670 34,625 Note1 TRANSPORT CO., LTD.

YANGZHOU YADONG 972,509 2,618,997 1,559,486 1,059,511 1,881,453 (6,964) 29,259 Note1 CEMENT CO., LTD.

HUBEI YADONG CEMENT 3,695,458 9,130,832 4,637,962 4,492,870 2,621,442 397,015 303,576 Note1 CO., LTD.

HUBEI YALI TRANSPORT 37,428 142,621 77,673 64,948 161,150 26,948 18,629 Note1 CO., LTD.

104 Special Disclosure

Earnings(Loss) Operating Income (Loss) Total Per Share Company Name Capital Total Assets Net Value Net Sales Income (After Income Liabilities (After Income (Loss) Tax) Tax)

SICHUAN YADONG 4,578,280 17,696,619 8,842,287 8,854,332 7,221,861 2,918,758 2,424,393 Note1 CEMENT CO., LTD.

NANCHANG YALI 280,709 508,982 189,557 319,425 231,805 22,649 23,166 Note1 CONCRETE PRODUCE LTD.

JIANGXI YALI TRANSPORT 58,481 152,557 25,091 127,466 151,739 36,437 31,105 Note1 CO., LTD.

NANCHANG YADONG 421,063 661,370 77,124 584,246 718,367 35,931 49,515 Note1 CEMENT CO., LTD.

WUHAN YALI CONCRETE 93,570 179,875 67,325 112,550 195,577 22,027 17,381 Note1 PRODUCE CO., LTD.

Note1: The subsidiaries in Mainland China or overseas are not limited liability companies; therefore it’s not able to count earnings per share. Note2: The data in Balance Sheet are converted according to the exchange rate at the end of 2009 (USD：31.94；SGD：22.75；RMB：4.6785； HKD：4.096；INR：0.6884); the data in Income Statement are converted according to the 2009 average exchange rate(USD：33.04；SGD： 22.7292；RMB：4.8368；HKD：4.2629；INR：0.6819). Note3: The operating income of investees is calculated according to the sum of gain/loss from selling/ buying shares and stock dividends.

◎Consolidated Financial Reports: Please See Attachment II. ◎Relationship Report: Not applicable. ◎Private placement: None.

◎The shares held or disposed by subsidiaries in the most recent fiscal year and the current fiscal year up to the date of printing of the annual report: None.

◎Any other matters that need to be specified: None.

◎Any material matter that affect stockholders’ equity and share price in the most recent fiscal year and the current fiscal year up to the date of printing of the annual report: None.

105 坦白熱忱，堅定信心，發揮團隊合作的精神。

夙興夜寐，殫精竭慮，作有計畫有效率的操作。

簡約樸素，穩當平實，實事求是地執行任務。

謹慎精確，細心縝密，注意人員及物資的安全。

“Sincerity, Diligence, Thrift, Prudence and Innovation”

多年來，同仁奉行不渝，已形成遠東關係企業特有的企業精神。徐董事長更期望同仁，凡事「澈澈底底、清清楚楚、追根究柢，做好為止」，並強調人人提高服務品質，事事講求工作效率，使遠東企業茁壯成長，永無止境。

亞洲水泥股份有限公司董事長徐旭東

ASIA CEMENT CORPORATION