1.Date the punishment was imposed: August 16 2019

2.Recipient of the punishment: Three responsible people for the conduct of OCEANIC BEVERAGES CO., INC., Sun, ○○ and others.

3.Legal basis of the punishment: Paragraph 8, Article 26-3 (A company shall formulate rules for the conduct of directors meetings; regulations governing the content of deliberations, procedures, matters to be recorded in the meeting minutes, public announcement, and other matters for compliance shall be prescribed by the Competent Authority.) of the Securities and Exchange Act, Subparagraph 7, Paragraph 1, Article 178 (Violation of the provisions of Article 26-3, paragraph 1, 7, or the forepart of paragraph 8, or of Article 26-3, paragraph 1, 7, or the forepart of paragraph 8, as applied mutatis mutandis under Article 165-1; or violation of the provisions of the regulations adopted pursuant to the latter part of paragraph 8 of Article 26-3, or adopted pursuant to the latter part of that paragraph as applied mutatis mutandis under Article 165-1, governing the content of deliberations, procedures, matters to be recorded in the meeting minutes, or public announcement.), Article 179 (Except as provided in Article 177-1 and in the preceding article, if a juristic person or a foreign company violates the provisions of this Act, the individual person responsible for the act will be punished under the articles of this chapter.) of the Securities and Exchange Act effective at the time of conduct, Paragraph 1 of Article 16 (If any director or a juristic person represented by a director is an interested party with respect to any agenda item, the director shall state the important aspects of the interested party relationship at the respective meeting. When the relationship is likely to prejudice the interests of the company, the director may not participate in discussion or voting on that agenda item, and further, shall enter recusal during discussion and voting on that item and may not act as another director''s proxy to exercise voting rights on that matter.) and Subparagraph 7, Paragraph 1 of Article 17 (Minutes shall be prepared of the discussions at board of directors meetings. The meeting minutes shall record the Agenda items: the method of resolution and the result for each proposal; a summary of the comments made by directors, supervisors, experts, or other persons; the name of any director that is an interested party as referred to in paragraph 1 of the preceding article, an explanation of the important aspects of the relationship of interest, the reasons why the director was required or not required to enter recusal, and the status of their recusal; opinions expressing objections or reservations at the meeting that were included in records or stated in writing; and any opinion issued in writing by an independent director under Article 7, paragraph 5.) of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies, and the proviso of Article 5 (The provision most favorable to the person punished shall apply if the law or self-governing ordinance in force prior to the imposition of the sanction is more favorable to him.) of the Administrative Penalty Act.

4.Facts of the violation and reasons: The board of the OCEANIC BEVERAGES CO., INC. had reached resolution on June 28 and September 18 of 2018 to obtain real estate from Kuo-shin Foods and had reached resolution on December 25, 2018 to provide loans to Kuo-shin Foods. However, some directors had conflict of interest in these matters discussed in the board meeting and did not clarify their status of conflict of interest. The meeting minutes did not record the names of directors involved in conflict of interest, the involvement, the rationale for recusal and reasons for not attempting recusal or the status of recusal; therefore, it is determined that they had violated Paragraph 1 of Article 16 and Paragraph 1 of Article 17 of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies.

5.The disciplinary action: A fine of NT$240,000 was imposed on the three responsible people for the conduct pursuant to Subparagraph 7, Paragraph 1, Article 178, and Article 179 of the Securities and Exchange Act effective at the time of conduct.

 

Contact Person: Section Chief Lin, Wen-Cheng, Corporate Finance Division, Securities and Futures Bureau  

Contact Tel.: 2774-7311

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