Yeong guan Group Addresses Short-Term Funding Challenges Related to Its Fourth Unsecured Convertible Corporate Bonds

Yeong guan Group’s Fourth Unsecured Convertible Corporate Bonds (Bond name: Yeong guan IV-KY; Code: 15894) have recently encountered short-term funding allocation challenges. The Company stated today (23) that, based on its self-prepared financial information as of the end of 2025, total assets significantly exceed total liabilities, and normal operations remain unaffected. Going forward, in accordance with applicable regulations, the Company will implement three response measures and three operational strategies, while actively engaging with bondholders of this issuance in debt restructuring discussions to safeguard investors’rights and interests.

In recent years, the Company has been affected by global economic and trade uncertainties, adjustments to domestic energy policies, and the residual effects of the pandemic, resulting in short-term working capital constraints. The Yeong guan IV-KY (CB4) bonds reached the third anniversary of issuance on February 20, 2026. Following the exercise of the put option by bondholders, the total redemption amount reached NT$1,035,605,020. Due to short-term funding allocation pressures, the Company has not completed repayment in accordance with the original schedule and will actively negotiate with bondholders pursuant to relevant regulations.

Yeong guan Group emphasized that its financial structure and operations remain stable. According to the third-quarter 2025 financial report, total assets exceeded NT$26 billion, while total liabilities were below NT$18 billion. Based on self-prepared financial information as of year-end 2025, total assets continue to significantly exceed total liabilities. In addition, operations and production at all plant locations are proceeding normally.

Three Response Measures Undertaken

In response to the bond repayment matter, management has proactively implemented the following measures:

1. Reallocation of Funds from Mainland China Operations
Since 2022, the Company has repatriated earnings from its Mainland China subsidiaries to support operational needs. To date, approximately RMB 1.067 billion has been distributed.

2. Communication with Banks and Government Authorities
Since the third quarter of 2024, the finance department has been discussing CB4 repayment arrangements with relationship banks. Beginning in the third quarter of 2025, the Company has also communicated with relevant government authorities, including the Industrial Development Administration and the Small and Medium Enterprise and Startup Administration under the Ministry of Economic Affairs, regarding short-term funding needs.

3. Seeking External Capital Injection
The Company has engaged with external investors to explore financing options. However, due to time constraints, investors were unable to complete due diligence and review procedures in time, and financing approval has not yet been obtained.

Three Operational Strategies to Strengthen Debt Servicing Capacity

To safeguard the maximum interests of all stakeholders, Yeong guan Group will continue to maintain close communication with banks and government authorities to ensure sufficient working capital during the transition period. In addition, the Company will implement the following strategies:

1. Activation of Idle Assets
The management team is actively seeking industrial zone approval for the Thailand plant site under the Eastern Economic Corridor (EEC) development program. Approval is expected to enhance land value, facilitating potential bank financing or asset disposal to strengthen working capital.

2. Optimization of Order Strategy and Global Expansion
The Taichung plant is adjusting its order acquisition strategy by expanding from the domestic market to overseas regions, including Europe, the United States, and Northeast Asia (such as Japan). In alignment with its mid- to long-term transformation plan, the Company will deepen its global presence to improve order visibility and profitability, thereby strengthening its financial structure.

3. Implementation of Lean Management
The Group will optimize its organizational structure and strictly control operating expenses, prioritizing the achievement of operational breakeven at the earliest possible time.

Yeong guan Group stated that it has long been committed to the localization of Taiwan’s offshore wind power industry, investing substantial efforts in plant construction planning, customized equipment introduction, supply chain development, and local talent cultivation. The development achieved to date has been hard-earned.

In light of the current short-term funding challenges, the Group reiterates that safeguarding the rights and interests of investors, creditors, and all stakeholders remains its highest priority. The Company sincerely appreciates the continued support and understanding of all parties. Subsequent negotiation and resolution processes will be conducted in a transparent manner, in strict compliance with applicable regulations, and material updates will be disclosed in a timely manner.