1. Date of occurrence of the event: Nov. 8th, 2018~ Nov. 8^th,2018.

2. Method of the present increase (decrease) in investment:

Issuance of Common Stock for cash to the subsidiary Shanghai No.1 Machine Tool Foundry(Su Zhou) Co., Ltd.

3. Transaction volume, price per unit, and total monetary amount of the transaction:

Total monetary amount of the transaction: 70,000,000 RMB.

4. Company name of the invested mainland Chinese company:

Shanghai No.1 Machine Tool Foundry(Su Zhou) Co., Ltd.

5. Paid-in capital of said invested mainland Chinese company:

US$ 80,000,000.

6. Amount of new capital increment currently planned by said invested mainland Chinese company:

US$ 2,3540,000.

7. Main business items of said invested mainland Chinese company:

production and sales for spherical graphite cast iron FCD and alloy gray cast iron FC.

8. Type of CPA opinion issued for the financial statement of said invested mainland Chinese company for the most recent fiscal year:

N/A.

9. Net worth of said invested mainland Chinese company on the financial statement for the most recent fiscal year:

NT$ 79,189,000.

10. Amount of profit/loss of said invested mainland Chinese company on the financial statement for the most recent fiscal year:

NT$ -67,963,000.

11. Amount of actual investment to date in said invested mainland Chinese company:

NT$ 718,676,000.

12. Counterparty to the transaction and its relationship to the Company:

A subsidiary that directly and indirectly held more than 93% by the Company.

13. Where the counterparty to the transaction is an actual related party, public announcement shall also be made of the reason for choosing the related party as the counterparty and the identity of the previous owner (including its relationship with the company and the trading counterpart), the date of transfer, and the price:

N/A.

14. Where a person who owned the subject matter of the transaction within the past five years has been an actual related party of the company, public announcement shall also be made of the dates and prices of acquisition and disposal by the related party and such party's relationship to the company at those times:

N/A.

15. Gain (or loss) on disposal:

N/A.

16. Terms of delivery or payment (including payment period and monetary amount), restrictive covenants in the contract, and other important stipulations:

Approved by the resolution of the board and the transaction may be separated in times according to authorization and needs.

17. The manner of deciding on this transaction, the reference basis for the decision on price and the decision-making department:

Board resolution.

18. Broker:

none.

19. Concrete purpose of the acquisition or disposal:

Infusion of cash into subsidiary for its operation, foundry constructions and equipment purchases.

20. Do the directors have any objection to the present transaction?:

No.

21. This present transaction is a related party transaction: Yes

22. Date of approval by the board of directors:

November 8^th,2018。

23. Date of approval by supervisors or the audit committee:

N/A.

24. Total amount of mainland China area investment (including the present investment) approved by the Investment Commission to date:

N/A.

25. Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the paid-in capital on the financial statement for the most recent period:

N/A.

26. Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the total assets on the financial statement for the most recent period:

N/A.

27. Ratio of the total amount of investment (including the present investment) in the mainland China area approved by the Investment Commission to date to the shareholders’ equity on the financial statement for the most recent period:

N/A.

28. Total amount of actual investment in the mainland China area to date:

NT$ 6,147,327,000.

29. Ratio of the total amount of actual investment in the mainland China area to date to the paid-in capital on the financial statement for the most recent period:

88.40%。

30. Ratio of the total amount of actual investment in the mainland China area to date to the total assets on the financial statement for the most recent period:

42.18%。

31. Ratio of the total amount of actual investment in the mainland China area to date to the shareholders’ equity on the financial statement for the most recent period:

74.64%。

32. Amount of recognized profits and losses on investment in the mainland China area for the most recent three fiscal years:

Year 2015: NT$ 1,317,517,000.          

Year 2016: NT$ 997,900,000.         

Year 2017: NT$ 282,860,000.  

33. Amount of profit remitted back to Taiwan for the most recent three fiscal years:

Year 2015: NT$ 0.             

Year 2016: NT$ 0.             

Year 2017: NT$ 0.

34. Has the CPA issued an opinion on the unreasonableness of the price of the current transaction?:

No or N/A.

35. Any other matters that need to be specified:

(1) Historical exchange rate is applied here for total amount of actual investment in the mainland China, if any of the amount of the original currency above is foreign currency, RMB:NTD=1:4.4453 is applied.           

(2) The financial statement for the most recent period refers to the consolidated financial statements of third-quarter,2018.