HTC Investors

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Announcement to increase the capital of HTC Electronics (Shanghai) Co., Ltd. by USD 8 million through High Tech Computer Asia Pacific PTE. Ltd.
1.Date of occurrence of the event:2009/02/26

2.Method of the present increase (decrease) in investment:
(1)Previously, the Company, through a capital increase of High Tech Computer Asia Pacific PTE. Ltd, effected a first time capital increase of HTC Electronics (Shanghai) Co., Ltd. (Wei-Hon) to cover the costs of factory constuction and equipment purchasing. Presently, the Board has adopted a resolution and received the approval of Ministry of Economic Affairs Investment Commission for an investment in the amount of USD 48 million. The total amount has been executed.
(2)To accommodate the Shanghai Kangqiao Factory’s factory constuction planning requirements, the Board of Directors resolved to initiate a second capital increase in the amount of USD8 million in order to cover factory constructions. Up to and including this round of capital increases, the cumulative amount of investment will reach USD56 million. The proposed increase will be implemented after receiving approval from the Ministry of Economic Affairs Investment Commission.
 
3.Transaction volume, price per unit, and total monetary amount of the transaction:USD8,000,000
 
4.Company name of the invested mainland Chinese company:HTC Electronics (Shanghai) Co., Ltd.
 
5.Paid-in capital of said invested mainland Chinese company:RMB332,075,766.52(USD 47,909,044)
 
6.Amount of new capital increment currently planned by said invested mainland Chinese company:USD8,000,000
 
7.Main business items of said invested mainland Chinese company:To research, develop, design, manufacture and fabricate computer, PDA, handset (100% for export) and the components and accessories of the above-mentioned products; To design, develop computer software; to sell own-manufactured products; and to provide related technical consultancies and services.
 
8.Type of CPA opinion issued for the financial statement of said invested mainland Chinese company for the most recent fiscal year:Unqualified Opinion
 
9.Net worth of said invested mainland Chinese company on the financial statement for the most recent fiscal year:RMB321,880,333.47(USD 47,072,292.11)
 
10.Amount of profit/loss of said invested mainland Chinese company on the financial statement for the most recent fiscal year:Net loss of RMB10,195,433.05
 
11.Amount of actual investment to date in said invested mainland Chinese company:USD48,000,000
 
12.Counterparty to the transaction and its relationship to the Company:N/A
 
13.Where the counterparty to the transaction is an actual related party, public announcement shall also be made of the reason for choosing the related party as the counterparty and the identity of the previous owner (including its relationship with the company and the trading counterpart), the date of transfer, and the price:N/A
 
14.Where a person who owned the subject matter of the transaction within the past five years has been an actual related party of the company, public announcement shall also be made of the dates and prices of acquisition and disposal by the related party and such party's relationship to the company at those times:N/A
 
15.Gain (or loss) on disposal:N/A
 
16.Terms of delivery or payment (including payment period and monetary amount), restrictive covenants in the contract, and other important stipulations:Investment will be delivered after the approval of Investment Committee of MOE.
 
17.The manner of deciding on this transaction, the reference basis for the decision on price and the decision-making department:It is resolved by the Board Meeting on Feb 26,2009
 
18.Broker:N/A
 
19.Concrete purpose of the acquisition or disposal:For the purpose of factory constructions in Company’shanghai Kangqiao Factory.
 
20.Do the directors have any objection to the present transaction?:N/A
 
21.Total amount of mainland China area investment (including the present investment) approved by the Investment Commission to date:USD86,200,000
 
22.Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the paid-in capital on the financial statement for the most recent period:39.64%
 
23.Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the total assets on the financial statement for the most recent period:2.60%
 
24.Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the shareholders’ equity on the financial statement for the most recent period:4.94%
 
25.Total amount of actual investment in the mainland China area to date:USD69,500,000
 
26.Ratio of the total amount of actual investment in the mainland China area to date to the paid-in capital on the financial statement for the most recent period:31.96%
 
27.Ratio of the total amount of actual investment in the mainland China area to date to the total assets on the financial statement for the most recent period:2.10%
 
28.Ratio of the total amount of actual investment in the mainland China area to date to the shareholders’ equity on the financial statement for the most recent period:3.98%
 
29.Amount of recognized profits and losses on investment in the mainland China area for the most recent three fiscal years:
To recognize investment losses of NTD59,196 Thousands for 2006.
To recognize investment gains of NTD24,317 Thousands for 2007.
To recognize investment losses of NTD58 Thousands for 2008.
 
30.Amount of profit remitted back to Taiwan for the most recent three fiscal years:None
 
31.Has the CPA issued an opinion on the unreasonableness of the price of the current transaction?:None
 
32.Any other matters that need to be specified:None