2017 Kuantian Steel

Date of Announcement: August 14, 2017 Date of Statement: August 13, 2017 Time of Statement: 15:33:32 Company Code: 2017 Company Name: Kuantian Steel

Subject: This announcement is made as the outstanding balance of fund loans provided by our company to its subsidiaries has reached the disclosure threshold specified under Article 22, Paragraph 1, Clause 3 of the 'Regulations Governing the Lending of Funds, Endorsement, and Guarantees by Publicly Issued Companies'.

Applicable Clause: Clause 23 Fact Occurrence Date: August 13, 2017

Details: 1. Fact Occurrence Date: 08/13/2017

2. Recipients of Fund Loans:

(1) Company Name: Kuantian Investment Development Co., Ltd. (2) Relationship to Lending Company: Subsidiary of our company (3) Fund Lending Limit (in thousand NTD): 646,792 (4) Previous Outstanding Loan Balance (in thousand NTD): 29,000 (5) Amount of New Loan This Time (in thousand NTD): 29,000 (6) Whether the board authorized the chairman to make multiple disbursements or revolving loans to the same borrower: Yes (7) Outstanding Loan Balance as of Fact Occurrence Date (in thousand NTD): 58,000 (8) Reason for New Loan: For operational working capital and short-term financing needs

(1) Company Name: Jiayuan Investment Development Co., Ltd. (2) Relationship to Lending Company: Subsidiary of our company (3) Fund Lending Limit (in thousand NTD): 646,792 (4) Previous Outstanding Loan Balance (in thousand NTD): 86,500 (5) Amount of New Loan This Time (in thousand NTD): 29,000 (6) Whether the board authorized the chairman to make multiple disbursements or revolving loans to the same borrower: Yes (7) Outstanding Loan Balance as of Fact Occurrence Date (in thousand NTD): 115,500 (8) Reason for New Loan: For operational working capital and short-term financing needs

(1) Company Name: Xiadu Investment Co., Ltd. (2) Relationship to Lending Company: Subsidiary of our company (3) Fund Lending Limit (in thousand NTD): 646,792 (4) Previous Outstanding Loan Balance (in thousand NTD): 10,000 (5) Amount of New Loan This Time (in thousand NTD): 10,000 (6) Whether the board authorized the chairman to make multiple disbursements or revolving loans to the same borrower: Yes (7) Outstanding Loan Balance as of Fact Occurrence Date (in thousand NTD): 20,000 (8) Reason for New Loan: For operational working capital and short-term financing needs

(1) Company Name: Meiyou Industrial Co., Ltd. (2) Relationship to Lending Company: Subsidiary of our company (3) Fund Lending Limit (in thousand NTD): 646,792 (4) Previous Outstanding Loan Balance (in thousand NTD): 90,000 (5) Amount of New Loan This Time (in thousand NTD): 30,000 (6) Whether the board authorized the chairman to make multiple disbursements or revolving loans to the same borrower: Yes (7) Outstanding Loan Balance as of Fact Occurrence Date (in thousand NTD): 120,000 (8) Reason for New Loan: For operational working capital and short-term financing needs

3. Collateral Provided by Loan Recipients:

(1) Description: None (2) Value (in thousand NTD): 0

4. Latest Financial Statements of Loan Recipients:

(1) Capital (in thousand NTD): 1,258,504 (2) Accumulated Profit/Loss (in thousand NTD): 88,017

5. Interest Calculation Method: Based on the highest short-term borrowing rate from financial institutions applicable to our company

6. Repayment Terms:

(1) Conditions: None (2) Due Date: Within one year from the date of fund disbursement

7. Total Outstanding Loan Balance as of Fact Occurrence Date (in thousand NTD): 313,500

8. Ratio of Outstanding Loan Balance to Net Assets in the Latest Financial Statements of the Publicly Issued Company: 4.85%

9. Source of Funds for Lending: Financial institutions, others

10. Other Matters to be Disclosed: Capital and Accumulated Profit/Loss of Each Loan Recipient (in thousand NTD) 1. Kuantian Investment: Capital 810,804; Accumulated Profit/Loss 126,384. 2. Jiayuan Investment: Capital 131,000; Accumulated Profit/Loss -75,695. 3. Xiadu Investment: Capital 50,000; Accumulated Profit/Loss 530. 4. Meiyou Industrial: Capital 266,700; Accumulated Profit/Loss 36,798.