PJ Asset Management submitted a shareholder proposal to the Management and Board of Directors of TECO Electric and Machinery Co., Ltd. (1504.TT) outlining a Value Enhancement Plan

TAIPEI,March 5,2020 -- PJ Asset Management Company ("PJAM") and its subsidiary,Jaryuan Investment Co. Ltd.,collectively holding more than 15% in common stock of TECO Electric and Machinery Co.,Ltd. ("TECO" or "Company"),submitted a letter to TECO's Board and Management outlining a Value Enhancement Planon March 4. This letter has been provided as a follow-up to our previous meeting with the Company on December 06,2019. With a position of approximately USD270 million in market value,PJAM is TECO's single largest shareholder.

The letter communicates PJAM's significant concerns regarding challenges facing TECO today and its analysis on the Company's opportunities to enhance corporate governance and capital allocation for the benefit of key stakeholders. Through interviews with a number of industry experts,former employees and market analysts,PJAM reviewed TECO's past successes and present need for changes in order to lay out this shareholder proposal. PJAM believes that the Company,by implementing the Value Enhancement Plan,can unlock its significant conglomerate discount,pinpoint new perspectives for development,and improve its balance sheet efficiency.

The original letter in Chinese can be found on PJAM's website: http://www.pjam.com.tw/.

PJAM's presentation on TECO's Value Enhancement Plan can be found here: http://www.pjam.com.tw/index.php?route=newsblog/article&article_id=42&lang=en-gb

March 4,2020

The Board of Directors

TECO Electric & Machinery Co.,Ltd.

5F,No. 19-9,San Chong Rd.,Nan-Kang,Taipei 11501,Taiwan

Dear Chairman Chiu and Members of the Board,

We are writing to you on behalf of PJ Asset Management Company ("PJAM") and its subsidiary Jaryuan Investment Co. Ltd. Together with Jaryuan,PJAM holds more than 15% in common stock in TECO Electric and Machinery Co.,making us TECO's single largest shareholder. This large investment underlines our significant level of attention on the Company's challenges and opportunities evident today.

Our Value Enhancement Plan is laid out in the attached analysis based on our review of TECO's past successes and its present need for reforms. This proposal is provided as follow-up to our previous meeting on December 06,2019. We believe that given a willingness to change,TECO's valuation will be re-priced to its historical glory. Stakeholders can benefit only when the Company is committed to winning and to staying attuned to,even ahead of,industry best practices.

TECO is one of the world's leading electrification firms,and we have the utmost respect for what Founder Huang,Chairman Chiu and the Company's management team have achieved with excellence. We recognize that this proposed value creation opportunity is only possible thanks to your diligence and dedication all these years.

We look forward to a positive and collaborative dialogue with TECO's board and management team to discuss this constructive plan. With conviction,we urge the Company to evaluate the initiatives outlined in the plan immediately,so that they can be announced and implemented without delay. As shareholders,we firmly believe the solutions outlined in the proposal offer the optimal path for TECO to maintain its market leadership and deliver long-term sustainable value.

Thank you very much for your consideration. We look forward to our meeting again in the near future.

With kind regards,

PJ Asset Management Company

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