Taipei, Taiwan, R.O.C. – May 11, 2010 Holy Stone Enterprise Co., Ltd. (Holy Stone) (TWSE: 3026) today held a meeting of Board of Directors, resolving to raise capital by domestic cash capital increase and the issuance of the third domestic unsecured convertible bond. Capital will be appropriated to repay bank loans, strengthening our financial structure and reducing interest expenses; and to purchase land and production facilities, expanding our capacity and increasing revenues and earnings, in order to enhance the competitiveness of the company's overall operations. The Board of Directors passed the following resolutions:

1. Approved the implement of cash capital increase, with an issuance of 33,000 thousand new common shares, at par value of NT$10 each share, to raise a total of NT$330,000 thousand. 10 percent of new common shares issued, totaled 3,300 thousand shares, will be retained to employee participation, another 10 percent of new common shares issued, also totaled 3,300 thousand shares, will be establish by public offering, and the remaining 80 percent of new common shares issued will be subscribed by the stockholders for 91.9 shares per thousand shares held according to their ownership on the base day.
2. Approved an issuance of third domestic unsecured convertible bond through book building, with the term of 5 years and the upper limit of NT$700 million, at par value of NT$100,000.