1.Kind of merger/acquisition (e.g.merger, consolidation, spin-off

,acquisition, or receiving assignment of shares):

Issuing new shares of this company to exchange other company's

outstanding shares.

2.Date of occurrence of the event:2010/05/28

3.Names of companies participating in the merger (e.g.name of the

other company participating in the merger or consolidation, newly

established company in a spin-off, acquired company, or company

whose shares are taken assignment of):HUGA OPTOTECH INC.

4.Counterparty (e.g.name of the other company participating in

the merger or consolidation, company taking assignment of the

spin-off, or counterparty to the acquisition or assignment of shares):

The shareholders of HUGA Optotech Inc.: such as Mr. Dennis Chen and others.

5.Relationship between the counterparty and the Company (investee

company in which the Company has re-invested and has shareholding

of XX%), and explanation of the reasons for the decision to acquire,

or take assignment of the shares of, an affiliated enterprise or

related person, and whether it will affect shareholders' equity:

The Relationship between the counterparty and the Company: None.

The reasons for the decision to acquire, or take assignment of the

shares of, an affiliated enterprise or related person: NA

Will shareholders' equity is affected: No

6.Purpose/objective of the merger/acquisitionation:

This company will begin Strategic cooperation with HUGA in order to enhance

the synergy of technologies and know-how between the parties to stimulate

efficient resource usage.

7.Anticipated benefits of the merger/acquisition:

(1)Enhancing the synergy of technologies and know-how between the parties

in order to stimulate efficient resource usage.

(2)Strengthening strategic cooperation and enhancing the performance of

management.

8.Effect of the merger or consolidation on net worth per share and

earnings per share:

This strategic cooperation will benefit the net value and profit of each

share of this company.

9.Share exchange ratio and basis of its calculation:

(1) The stock exchange rate is 1: 2.36 (one Epistar common share to

2.36 HUGA common shares).

(2) the calculation of exchange rate is base upon the finical reports of

this company and HUGA audited and verified by the certified public

accountants, the net value of each share of both companies, the market

price of each share of both companies, performance of management, the

future development of both parties and other factors. The exchange rate

is fully discussed and considered by both companies in every aspect in

order to achieve an agreement in this regard and refer to opinions made

by independent financial experts.

10.Scheduled timetable for consummation:

The scheduled timetable for exchanging shares is July 19th, 2010.

11.Matters related to assumption by the existing company or new

company of rights and obligations of the extinguished (or spun-off)

company::NA

12.Basic information of companies participating in the merger:

(1)The major business of Epistar Corporation is to manufacture and sell high

brightness LED chips.

(2)The major business of HUGA Optotech Inc. is to manufacture electronics

components (such as LED chips and wafer).

13.Matters related to the spin-off (including estimated value of

the business and assets planned to be assigned to the existing

company or new company; the total number and the types and

volumesof the shares to be acquired by the split company or

its shareholders; matters related to the reduction, if any,

in capital of the split company) (note: not applicable other

than where there is announcementof a spin-off):NA

14.Conditions and restrictions on future transfers of shares

resulting from the merger or acquisition:None

15.Other important stipulations:None

16.Do the directors have any objection to the present transaction?:No