Affected by the new refinancing policy, Shenzhen Konka terminates its non-public offering of A shares

Shenzhen Konka issued an announcement stating that in view of changes in refinancing regulations, regulatory policies, and capital market environment, and taking into account internal and external factors such as the company's operating conditions, financing environment, and development plans, in order to safeguard the interests of the company and all shareholders, and communicating with multiple parties including the sponsor, after careful study by the company's board of directors, it agreed to the company's application to the China Securities Regulatory Commission to terminate the private placement of A shares.

At the same time, the Company and Shenzhen OCT Capital Investment Management Co., Ltd. (hereinafter referred to as "OCT Capital") signed the "Termination Contract of the Conditionally Effective Share Subscription Agreement" (hereinafter referred to as the "Termination Contract of the Share Subscription Agreement"), agreeing to terminate the "Conditionally Effective Non-public Issuance of Shares Subscription Agreement" (hereinafter referred to as the "Stock Subscription Agreement") signed by the Company and OCT Capital on March 28, 2019.

As of the signing date of the "Termination Contract of the Share Subscription Agreement", Shenzhen Konka's controlling shareholder Overseas Chinese Town Group Co., Ltd. (hereinafter referred to as "OCT Group") holds 523,746,932 A shares of the company, accounting for 21.75% of the company's total share capital; Overseas Chinese Town Capital holds 275,500 A shares of the company, accounting for 0.01% of the company's total share capital; Jialong Investment Co., Ltd. (hereinafter referred to as "Jialong Investment") holds 180,001,110 and 18,360,000 B shares of the company through CITIC Securities Brokerage (Hong Kong) Co., Ltd. and China Merchants Securities Hong Kong Co., Ltd., respectively, accounting for 8.24% of the company's total share capital. Since Overseas Chinese Town Capital and Jialong Investment are both wholly-owned subsidiaries of Overseas Chinese Town Group, Overseas Chinese Town Group and its persons acting in concert hold a total of 722,383,542 shares of the company, accounting for 29.999997% of the company's total share capital. According to relevant regulations, Overseas Chinese Town Capital is a related party of the company, and this transaction constitutes a related transaction.

Shenzhen Konka stated that this transaction was the result of the company's comprehensive consideration of internal and external factors such as operating conditions, financing environment and development plans, and the result of consensus reached with Overseas Chinese Town Capital. It will not have a significant impact on the company's operating conditions, and there is no situation that will harm the interests of the company and all shareholders, especially small and medium-sized shareholders.