Novautek Technologies Group Limited — Proxy Solicitation & Information Statement 2023

May 25, 2023

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action you should take, you should consult your licensed securities dealer or registered institution in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Kong Sun Holdings Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser(s) or the transferee(s) or to the bank, stockbroker or other agent through whom the sale or the transfer was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

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KONG SUN HOLDINGS LIMITED 江 山 控 股 有 限 公 司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 295)

(1) MAJOR TRANSACTION – FINANCE LEASE ARRANGEMENTS AND

(2) NOTICE OF EXTRAORDINARY GENERAL MEETING

A letter from the Board is set out on pages 4 to 16 of this circular.

A notice convening the extraordinary general meeting of the Company to be held at Unit 803-4, 8/F, Everbright Centre, 108 Gloucester Road, Wanchai, Hong Kong on Tuesday, 13 June 2023 at 11:00 a.m. is set out on pages EGM-1 to EGM-2 of this circular. Whether or not you intend to attend the EGM, you are requested to complete the accompanying form of proxy in accordance with the instructions printed thereon and return the same to the Company’s share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, as soon as possible and in any event not less than 48 hours before the time fixed for holding the EGM or any adjournment thereof. Completion and return of the form(s) of proxy will not preclude you from attending and voting in person at the EGM should you so wish.

25 May 2023

CONTENTS

	Pages
Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Appendix I – Financial Information of the Group. . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II – General Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	II-1
Notice of the EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

— i —

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions have the following meanings:

• “Board”

board of Directors

“Company” Kong Sun Holdings Limited, a company incorporated in Hong Kong with limited liability, the Shares of which are listed on the main board of the Stock Exchange (Stock Code: 295)

• “connected person(s)” has the meaning ascribed to it under the Listing Rules

• “Director(s)” director(s) of the Company

• “EGM”

the extraordinary general meeting of the Company to be convened for the purpose of considering and, if thought fit, approve the Finance Lease Arrangements

• “Feixi Zhonghui”

肥西中暉光伏發電有限公司 (Feixi Zhonghui Photovoltaic Power Limited*), a company established in the PRC with limited liability and an indirect wholly-owned subsidiary of the Company

• “Finance Lease Agreement I”

• the finance lease agreement dated 28 April 2023 entered into between Suzhou Xuqiang, as lessee, and Hebei Financial Leasing, as lessor, in respect of the Leased Assets I

• “Finance Lease Agreement II”

• the finance lease agreement dated 28 April 2023 entered into between Huangshi Huangyuan, as lessee, and Hebei Financial Leasing, as lessor, in respect of the Leased Assets II

• “Finance Lease Agreement III”

• the finance lease agreement dated 28 April 2023 entered into between Feixi Zhonghui, as lessee, and Hebei Financial Leasing, as lessor, in respect of the Leased Assets III

• “Finance Lease Arrangements”

• the transactions contemplated under the Finance Lease Agreements I, II & III and the Pledges I, II & III

• “Group”

the Company and its subsidiaries

• “Hebei Financial Leasing”

• 河北省金融租賃有限公司 (Hebei Financial Leasing Co., Ltd.*), a company established in the PRC with limited liability

• “HKFRS”

Hong Kong Financial Reporting Standards

• “Hong Kong”

the Hong Kong Special Administrative Region of the PRC

— 1 —

DEFINITIONS

• “Huangshi Huangyuan” 黃石黃源光伏電力開發有限公司 (Huangshi Huangyuan Photovoltaic Power Development Limited*), a company established in the PRC with limited liability and an indirect wholly-owned subsidiary of the Company

• “Independent Third Party(ies)” party(ies) who are independent of the Company and connected persons of the Company

• “Kong Sun Yongtai” 江山永泰投資控股有限公司 (Kong Sun Yongtai Investment Holding Co., Ltd.*), a company established in the PRC and an indirect wholly-owned subsidiary of the Company

• “Latest Practicable Date” 22 May 2023, being the latest practicable date prior to the printing of this circular for ascertaining certain information for inclusion in this circular

• “Leased Assets I” all the photovoltaic power generating equipment and ancillary facilities regarding the 20MW photovoltaic power plant located in Suzhou City, Anhui Province, the PRC

• “Leased Assets II” certain photovoltaic power generating equipment and ancillary facilities regarding the 30MW photovoltaic power plant located in Huangshi City, Hubei Province, the PRC

• “Leased Assets III” all the photovoltaic power generating equipment and ancillary facilities regarding the 20MW photovoltaic power plant located in Hefei City, Anhui Province, the PRC

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

• “LPR” the loan prime rate for loans with a maturity of above 5 years as promulgated by the National Interbank Funding Centre under the authority of the People’s Bank of China

• “MW” megawatts

• “Pledges I”

• collectively, (a) a pledge on all income arising from the Leased Assets I including electricity bill receivables and government subsidies receivables by Suzhou Xuqiang (in the approximate amount of RMB50,220,000 as at 31 December 2022); and (b) a pledge of the entire equity interest in Suzhou Xuqiang by Kong Sun Yongtai

— 2 —

DEFINITIONS

• “Pledges II”

collectively, (a) a pledge on all income arising from the Leased Assets II including electricity bill receivables and government subsidies receivables by Huangshi Huangyuan (in the approximate amount of RMB92,108,000 as at 31 December 2022); and (b) a pledge of the entire equity entire equity interest in Huangshi Huangyuan by Kong Sun Yongtai

“Pledges III” collectively, (a) a pledge on all income arising from the Leased Assets III including electricity bill receivables and government subsidies receivables by Feixi Zhonghui (in the approximate amount of RMB51,606,000 as at 31 December 2022); and (b) a pledge of the entire equity interest in Feixi Zhonghui by Kong Sun Yongtai

• “PRC” the People’s Republic of China

• “PRC GAAP”

the generally accepted accounting principles of the PRC

• “Previous Disposals”

(i) the previous disposals of seven project companies from Kong Sun Yongtai and 新疆誠石易盛商貿有限公司 (Xinjiang Chengshi Yisheng Trading Co., Ltd.) to 新華電力發展投資有限 公司 (Xinhua Electricity Development Investment Limited) as disclosed in the Company’s announcement dated 2 November 2021; and (ii) the previous disposals of the entire equity interests of 濟源大峪江山光伏發電有限公司 (Jiyuan Dayu Jiangshan Photovoltaic Power Generation Limited) and 50% equity interests of 寶豐縣鑫泰光伏電力科技開發有限公司 (Baofeng Xintai Photovoltaic Power Technology Development Limited*) as disclosed in the Company’s announcement dated 25 March 2022

• “RMB”

Renminbi, the lawful currency of the PRC

• “SFO”

the Securities and Futures Ordinance (Cap. 571 of the laws of Hong Kong)

• “Shareholder(s)” holder(s) of the Shares

• “Shares” ordinary share(s) in the share capital of the Company

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Suzhou Xuqiang”

宿州旭強新能源工程有限公司 (Suzhou Xuqiang New Energy Engineering Limited*), a company established in the PRC with limited liability and an indirect wholly-owned subsidiary of the Company

“%”

per cent.

• For identification purposes only

— 3 —

LETTER FROM THE BOARD

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KONG SUN HOLDINGS LIMITED 江 山 控 股 有 限 公 司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 295)

Executive Director: Mr. Xian He Non-executive Director: Mr. Jiang Hengwen (Chairman)

Registered office and Principal Place of Business: Unit 803-4, 8/F, Everbright Centre, 108 Gloucester Road, Wanchai, Hong Kong

Independent non-executive Directors: Ms. Tang Yinghong Ms. Wu Wennan Mr. Xu Xiang

25 May 2023

To the Shareholders

Dear Sir or Madam,

MAJOR TRANSACTION – FINANCE LEASE ARRANGEMENTS

INTRODUCTION

Reference is made to the Announcement. The purpose of this circular is to provide you with, among other things, further details of the Finance Lease Arrangements, the financial information of the Group, the notice convening the EGM and other information as required under the Listing Rules.

THE FINANCE LEASE AGREEMENT I

On 28 April 2023, Suzhou Xuqiang, as lessee, and Hebei Financial Leasing, as lessor entered into the Finance Lease Agreement I, pursuant to which Hebei Financial Leasing shall purchase the Leased Assets I from Suzhou Xuqiang for a total consideration of RMB80,000,000. The Leased Assets I would then be leased back to Suzhou Xuqiang for a term of 10 years. The legal ownership of the Leased Assets I under the Finance Lease Agreement I will be vested in Hebei Financial Leasing throughout the lease period. At the end of the lease period and subject to payments by Suzhou Xuqiang of all amounts due under the Finance Lease Agreement I, the legal ownership of the Leased Assets I will be vested in Suzhou Xuqiang at nil consideration.

— 4 —

LETTER FROM THE BOARD

A summary of the principal terms of the Finance Lease Agreement I is set out below:

Sale and purchase arrangements and consideration

Pursuant to the Finance Lease Agreement I, Hebei Financial Leasing would purchase the Leased Assets I from Suzhou Xuqiang for a total consideration of RMB80,000,000. The consideration would be payable in cash by Hebei Financial Leasing to Suzhou Xuqiang, which was determined after arm’s length negotiations between parties to the Finance Lease Agreement I by reference to the prevailing market price of the Leased Assets I.

The total consideration would be payable by Hebei Financial Leasing in full after the fulfillment of certain conditions precedent as set out in the Finance Lease Agreement I.

Conditions precedent

Under the Finance Lease Agreement I, the total consideration would be payable by Hebei Financial Leasing to Suzhou Xuqiang after fulfillment of the following conditions precedent, which are waivable by Hebei Financial Leasing (save for the condition in (a) below):

• (a) Suzhou Xuqiang having obtained and produced the internal approvals documents (including approval by the Shareholders and the Board) for the Finance Lease Agreement I and the transactions contemplated thereunder in accordance with its articles of association;

• (b) Suzhou Xuqiang or other guarantors having executed the security documents for the Finance Lease Agreement I and completed the relevant registration procedures (if necessary);

• (c) Hebei Financial Leasing, with the assistance of Suzhou Xuqiang, having completed the relevant registration procedures of the Finance Lease Agreement I and the transactions contemplated thereunder at the relevant competent PRC authorities;

• (d) Hebei Financial Leasing having received all relevant documentary evidence showing that the Leased Assets I have been insured in accordance with the requirements under the Finance Lease Agreement I;

• (e) Hebei Financial Leasing having received from Suzhou Xuqiang the relevant invoice specifying the payment details; and

• (f) other conditions considered necessary by Hebei Financial Leasing.

Lease back arrangements

Pursuant to the Finance Lease Agreement I, Hebei Financial Leasing agreed to lease the Leased Assets I back to Suzhou Xuqiang for a term of 10 years.

— 5 —

LETTER FROM THE BOARD

Lease payments

Pursuant to the Finance Lease Agreement I, the total estimated aggregate lease payments payable by Suzhou Xuqiang to Hebei Financial Leasing shall be approximately RMB105,766,000 in 40 quarterly instalments, being the principal lease cost of RMB80,000,000 plus the estimated aggregate interest of approximately RMB25,766,000. The estimated interests are calculated at a rate of 5.85% determined with reference to the LPR on 20 March 2023 at 4.3% plus 155 basis point. The lease interest rate shall be adjusted on 20th July of each calendar year during the lease period by reference to the corresponding change of the most recent LPR before the adjustment date. Suzhou Xuqiang intends to finance the total lease payments by using the Group’s internal resources.

The obligations of Suzhou Xuqiang under the Finance Lease Agreement I shall be secured by a corporate guarantee from Kong Sun Yongtai and the Pledges I in favour of Hebei Financial Leasing.

Ownership of the Leased Assets I

During the lease period, the legal ownership of the Leased Assets I under the Finance Lease Agreement I will be vested in Hebei Financial Leasing and Suzhou Xuqiang will have the rights to use the Leased Assets I. At the end of the lease period and subject to payments by Suzhou Xuqiang of all amounts due under the Finance Lease Agreement I, the legal ownership of the Leased Assets I will be vested in Suzhou Xuqiang at nil consideration.

The estimated aggregate lease payments under the Finance Lease Agreement I were determined after arm’s length negotiations between the parties to the Finance Lease Agreement I with reference to the principal amounts of the lease or the consideration for the Leased Assets I under the Finance Lease Agreement I and the prevailing market interest rate for finance lease of comparable assets.

Termination

Pursuant to the Finance Lease Agreement I, Suzhou Xuqiang may early terminate the Finance Lease Agreement I without any penalty subject to the written consent of Hebei Financial Leasing and no occurrence of any breach of the Finance Lease Agreement I by Suzhou Xuqiang.

THE FINANCE LEASE AGREEMENT II

On 28 April 2023, Huangshi Huangyuan, as lessee, and Hebei Financial Leasing, as lessor entered into the Finance Lease Agreement II, pursuant to which Hebei Financial Leasing shall purchase the Leased Assets II from Huangshi Huangyuan for a total consideration of RMB90,000,000. The Leased Assets II would then be leased back to Huangshi Huangyuan for a term of 10 years. The legal ownership of the Leased Assets II under the Finance Lease Agreement II will be vested in Hebei Financial Leasing throughout the lease period. At the end of the lease period and subject to payments by Huangshi Huangyuan of all amounts due under the Finance Lease Agreement II, the legal ownership of the Leased Assets II will be vested in Huangshi Huangyuan at nil consideration.

— 6 —

LETTER FROM THE BOARD

A summary of the principal terms of the Finance Lease Agreement II is set out below:

Sale and purchase arrangements and consideration

Pursuant to the Finance Lease Agreement II, Hebei Financial Leasing would purchase the Leased Assets II from Huangshi Huangyuan for a total consideration of RMB90,000,000. The consideration would be payable in cash by Hebei Financial Leasing to Huangshi Huangyuan, which was determined after arm’s length negotiations between parties to the Finance Lease Agreement II by reference to the prevailing market price of the Leased Assets II.

The total consideration would be payable by Hebei Financial Leasing in full after the fulfillment of certain conditions precedent as set out in the Finance Lease Agreement II.

Conditions precedent

Under the Finance Lease Agreement II, the total consideration would be payable by Hebei Financial Leasing to Huangshi Huangyuan after fulfillment of the following conditions precedent, which are waivable by Hebei Financial Leasing (save for the condition in (a) below):

• (a) Huangshi Huangyuan having obtained and produced the internal approvals documents (including approval by the Shareholders and the Board) for the Finance Lease Agreement II and the transactions contemplated thereunder in accordance with its articles of association;

• (b) Huangshi Huangyuan or other guarantors having executed the security documents for the Finance Lease Agreement II and completed the relevant registration procedures (if necessary);

• (c) Hebei Financial Leasing, with the assistance of Huangshi Huangyuan, having completed the relevant registration procedures of the Finance Lease Agreement II and the transactions contemplated thereunder at the relevant competent PRC authorities;

• (d) Hebei Financial Leasing having received all relevant documentary evidence showing that the Leased Assets II have been insured in accordance with the requirements under the Finance Lease Agreement II;

• (e) Hebei Financial Leasing having received from Huangshi Huangyuan the relevant invoice specifying the payment details; and

• (f) other conditions considered necessary by Hebei Financial Leasing.

Lease back arrangements

Pursuant to the Finance Lease Agreement II, Hebei Financial Leasing agreed to lease the Leased Assets II back to Huangshi Huangyuan for a term of 10 years.

— 7 —

LETTER FROM THE BOARD

Lease payments

Pursuant to the Finance Lease Agreement II, the total estimated aggregate lease payments payable by Huangshi Huangyuan to Hebei Financial Leasing shall be approximately RMB120,010,000 in 40 quarterly instalments, being the principal lease cost of RMB90,000,000 plus the estimated aggregate interest of approximately RMB30,010,000. The estimated interests are calculated at a rate of 5.85% determined with reference to the LPR on 20 March 2023 at 4.3% plus 155 basis point. The lease interest rate shall be adjusted on 20th July of each calendar year during the lease period by reference to the corresponding change of the most recent LPR before the adjustment date. Huangshi Huangyuan intends to finance the total lease payments by using the Group’s internal resources.

The obligations of Huangshi Huangyuan under the Finance Lease Agreement II shall be secured by a corporate guarantee from Kong Sun Yongtai and the Pledges II in favour of Hebei Financial Leasing.

Ownership of the Leased Assets II

During the lease period, the legal ownership of the Leased Assets II under the Finance Lease Agreement II will be vested in Hebei Financial Leasing and Huangshi Huangyuan will have the rights to use the Leased Assets II. At the end of the lease period and subject to payments by Huangshi Huangyuan of all amounts due under the Finance Lease Agreement II, the legal ownership of the Leased Assets II will be vested in Huangshi Huangyuan at nil consideration.

The estimated aggregate lease payments under the Finance Lease Agreement II were determined after arm’s length negotiations between the parties to the Finance Lease Agreement II with reference to the principal amounts of the lease or the consideration for the Leased Assets II under the Finance Lease Agreement II and the prevailing market interest rate for finance lease of comparable assets.

Termination

Pursuant to the Finance Lease Agreement II, Huangshi Huangyuan may early terminate the Finance Lease Agreement II without any penalty subject to the written consent of Hebei Financial Leasing and no occurrence of any breach of the Finance Lease Agreement II by Huangshi Huangyuan.

THE FINANCE LEASE AGREEMENT III

On 28 April 2023, Feixi Zhonghui, as lessee, and Hebei Financial Leasing, as lessor entered into the Finance Lease Agreement III, pursuant to which Hebei Financial Leasing shall purchase the Leased Assets III from Feixi Zhonghui for a total consideration of RMB100,000,000. The Leased Assets III would then be leased back to Feixi Zhonghui for a term of 10 years. The legal ownership of the Leased Assets III under the Finance Lease Agreement III will be vested in Hebei Financial Leasing throughout the lease period. At the end of the lease period and subject to payments by Feixi Zhonghui of all amounts due under the Finance Lease Agreement III, the legal ownership of the Leased Assets III will be vested in Feixi Zhonghui at nil consideration.

— 8 —

LETTER FROM THE BOARD

A summary of the principal terms of the Finance Lease Agreement III is set out below:

Sale and purchase arrangements and consideration

Pursuant to the Finance Lease Agreement III, Hebei Financial Leasing would purchase the Leased Assets III from Feixi Zhonghui for a total consideration of RMB100,000,000. The consideration would be payable in cash by Hebei Financial Leasing to Feixi Zhonghui, which was determined after arm’s length negotiations between parties to the Finance Lease Agreement III by reference to the prevailing market price of the Leased Assets III.

The total consideration would be payable by Hebei Financial Leasing in two tranches after the fulfillment of certain conditions precedent as set out in the Finance Lease Agreement III.

Conditions precedent

Under the Finance Lease Agreement III, the first tranche of the consideration in the amount of not exceeding approximately RMB50,470,000 would be payable by Hebei Financial Leasing to Feixi Zhonghui after fulfillment of the following conditions precedent, which are waivable by Hebei Financial Leasing (save for the condition in (a) below):

• (a) Feixi Zhonghui having obtained and produced the internal approvals documents (including approval by the Shareholders and the Board) for the Finance Lease Agreement III and the transactions contemplated thereunder in accordance with its articles of association;

• (b) Feixi Zhonghui or other guarantors having executed the security documents for the Finance Lease Agreement III and completed the relevant registration procedures (if necessary);

• (c) Hebei Financial Leasing, with the assistance of Feixi Zhonghui, having completed the relevant registration procedures of the Finance Lease Agreement III and the transactions contemplated thereunder at the relevant competent PRC authorities;

• (d) Hebei Financial Leasing having received all relevant documentary evidence showing that the Leased Assets III have been insured in accordance with the requirements under the Finance Lease Agreement III; and

• (e) Hebei Financial Leasing having received from Feixi Zhonghui the relevant invoice specifying the payment details.

— 9 —

LETTER FROM THE BOARD

Under the Finance Lease Agreement III, the remaining consideration would be payable by Hebei Financial Leasing to Feixi Zhonghui after fulfillment of the following conditions precedent, which are waivable by Hebei Financial Leasing:

• (a) Hebei Financial Leasing having received from Feixi Zhonghui the relevant invoice specifying the payment details;

• (b) there being no non-compliance with the sale and purchase agreement or the Finance Lease Agreement III by Feixi Zhonghui or any other circumstances which would have entitled Hebei Financial Leasing to early terminate the Finance Lease Agreement III; and

• (c) other conditions considered necessary by Hebei Financial Leasing.

Lease back arrangements

Pursuant to the Finance Lease Agreement III, Hebei Financial Leasing agreed to lease the Leased Assets III back to Feixi Zhonghui for a term of 10 years.

Lease payments

Pursuant to the Finance Lease Agreement III, the total estimated aggregate lease payments payable by Feixi Zhonghui to Hebei Financial Leasing shall be approximately RMB133,251,000 in 40 quarterly instalments, being the principal lease cost of RMB100,000,000 plus the estimated aggregate interest of approximately RMB33,251,000. The estimated interests are calculated at a rate of 5.85% determined with reference to the LPR on 20 March 2023 at 4.3% plus 155 basis point. The lease interest rate shall be adjusted on 20th July of each calendar year during the lease period by reference to the corresponding change of the most recent LPR before the adjustment date. Feixi Zhonghui intends to finance the total lease payments by using the Group’s internal resources.

The obligations of Feixi Zhonghui under the Finance Lease Agreement III shall be secured by a corporate guarantee from Kong Sun Yongtai and the Pledges III in favour of Hebei Financial Leasing.

Ownership of the Leased Assets III

During the lease period, the legal ownership of the Leased Assets III under the Finance Lease Agreement III will be vested in Hebei Financial Leasing and Feixi Zhonghui will have the rights to use the Leased Assets III. At the end of the lease period and subject to payments by Feixi Zhonghui of all amounts due under the Finance Lease Agreement III, the legal ownership of the Leased Assets III will be vested in Feixi Zhonghui at nil consideration.

— 10 —

LETTER FROM THE BOARD

The estimated aggregate lease payments under the Finance Lease Agreement III were determined after arm’s length negotiations between the parties to the Finance Lease Agreement III with reference to the principal amounts of the lease or the consideration for the Leased Assets III under the Finance Lease Agreement III and the prevailing market interest rate for finance lease of comparable assets.

Termination

Pursuant to the Finance Lease Agreement III, Feixi Zhonghui may early terminate the Finance Lease Agreement III without any penalty subject to the written consent of Hebei Financial Leasing and no occurrence of any breach of the Finance Lease Agreement III by Feixi Zhonghui.

REASONS FOR AND BENEFITS OF THE FINANCE LEASE ARRANGEMENTS

The Finance Lease Arrangements and the transactions contemplated thereunder have been agreed under normal commercial terms and after arm’s length negotiations between the relevant parties and provide the Group with general working capital. The Directors therefore consider that the terms of the Finance Lease Arrangements and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

INFORMATION ON THE LEASED ASSETS

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of the Leased Assets I was approximately RMB140,843,000. On this basis, the loan-to-value ratio under the Finance Lease Agreement I is approximately 57%. Taking into account the funding needs of the Group, the interest rate under the Finance Lease Agreement I and the commercial negotiations with Hebei Financial Leasing, the Board takes the view that such loan-to-value ratio is fair and reasonable.

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(unaudited)
	(RMB’000)	(RMB’000)
The profit before tax attributable to the Leased Assets I	8,851	9,104
The profit after tax attributable to the Leased Assets I	6,638	7,966

— 11 —

LETTER FROM THE BOARD

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of the Leased Assets II was approximately RMB157,397,000. On this basis, the loan-to-value ratio under the Finance Lease Agreement II is approximately 57%. Taking into account the funding needs of the Group, the interest rate under the Finance Lease Agreement II and the commercial negotiations with Hebei Financial Leasing, the Board takes the view that such loan-to-value ratio is fair and reasonable.

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(unaudited)
	(RMB’000)	(RMB’000)
The profit before tax attributable to the Leased Assets II	16,593	18,506
The profit after tax attributable to the Leased Assets II	14,519	16,193

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of the Leased Assets III was approximately RMB112,631,000.

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(unaudited)
	(RMB’000)	(RMB’000)
The profit before tax attributable to the Leased Assets III	11,041	10,832
The profit after tax attributable to the Leased Assets III	8,281	9,478

INFORMATION ON THE LESSEES

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of Suzhou Xuqiang was approximately RMB52,320,000. The key financial information of Suzhou Xuqiang prepared under the PRC GAAP for the two years ended 31 December 2022 is set out as follows:

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(audited)
	(RMB’000)	(RMB’000)
The profit/(loss) before tax attributable to Suzhou Xuqiang	(1,707)	(2,447)
The profit/(loss) after tax attributable to Suzhou Xuqiang	(1,707)	(2,447)

— 12 —

LETTER FROM THE BOARD

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of Huangshi Huangyuan was approximately RMB63,392,000. The key financial information of Huangshi Huangyuan prepared under the PRC GAAP for the two years ended 31 December 2022 is set out as follows:

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(audited)
	(RMB’000)	(RMB’000)
The profit before tax attributable to Huangshi Huangyuan	5,846	4,800
The profit after tax attributable to Huangshi Huangyuan	5,259	4,200

As at 31 December 2022, the unaudited book value (prepared under the PRC GAAP) of Feixi Zhonghui was approximately RMB57,404,000. The key financial information of Feixi Zhonghui prepared under the PRC GAAP for the two years ended 31 December 2022 is set out as follows:

	For the year	ended
	31 December
	2022	2021
	(unaudited)	(audited)
	(RMB’000)	(RMB’000)
The profit before tax attributable to Feixi Zhonghui	3,407	824
The profit/(loss) after tax attributable to Feixi Zhonghui	647	(526)

FINANCIAL EFFECT OF THE FINANCE LEASE ARRANGEMENTS AND USE OF PROCEEDS

It is expected that according to the Hong Kong Financial Reporting Standards, the transactions contemplated under the Finance Lease Arrangements shall be accounted for as financing arrangements and therefore would not give rise to any gain or loss. As the interest rate of the Finance Lease Arrangements is lower than the Group’s average cost of borrowing, the reduction of finance cost will be beneficial to the Group and the Shareholders as a whole. After deducting the incidental costs attributable to the Finance Lease Arrangements, the Group will receive net disposal proceeds of approximately RMB269,400,000 in aggregate under the Finance Lease Arrangements. It is expected that the net disposal proceeds will be used for general working capital of the Group by 31 December 2023.

— 13 —

LETTER FROM THE BOARD

INFORMATION ON THE COMPANY, KONG SUN YONGTAI AND THE LESSEES

The Company is principally engaged in the investment in and operation of solar power plants, provision of solar power plant operation and maintenance services, provision of financial services and asset management.

Kong Sun Yongtai is a company established in the PRC and an indirect wholly-owned subsidiary of the Company, which is principally engaged in the investment and operation of solar-power plants.

Suzhou Xuqiang is a company established in the PRC and an indirect wholly-owned subsidiary of the Company, which is principally engaged in solar power generation. As at the Latest Practicable Date, Suzhou Xuqiang was wholly-owned by Kong Sun Yongtai.

Huangshi Huangyuan is a company established in the PRC and an indirect wholly-owned subsidiary of the Company, which is principally engaged in solar power generation. As at the Latest Practicable Date, Huangshi Huangyuan was wholly-owned by Kong Sun Yongtai.

Feixi Zhonghui is a company established in the PRC and an indirect wholly-owned subsidiary of the Company, which is principally engaged in solar power generation. As at the Latest Practicable Date, Feixi Zhonghui was wholly-owned by Kong Sun Yongtai.

INFORMATION ON HEBEI FINANCIAL LEASING

Hebei Financial Leasing is principally engaged in the finance leases and factoring businesses. As at the Latest Practicable Date, Hebei Financial Leasing was held as to approximately 21.43%, 18.37%, 15.31%, 15.31%, 11.48%, 6.62%, 5.74% and 5.74% by 河北建設 投資集團有限責任公司 (Hebei Construction & Investment Group Co., Ltd.), 新奧集團股份有 限公司 (ENN Group Co., Ltd.), 新奧控股投資股份有限公司 (ENN Holdings Investment Co., Ltd.), 石家庄國控城市發展投資集團有限責任公司 (Shijiazhuang Guokong Urban Development Investments Group Co., Ltd.), 華美現代流通發展有限公司 (Huamei Modern Circulation Development Co., Ltd.), 保定白溝箱包城投資有限公司 (Baoding Baigouxiang Baocheng Investment Co., Ltd.), 西安金匯汽車服務有限公司 (Xi’an Jinhui Automobile Service Co., Ltd.) and 上海德力西集團有限公司 (Shanghai Delixi Group Co., Ltd.), respectively.

As at the Latest Practicable Date, the four largest ultimate beneficial owners of Hebei Financial Leasing were 王玉鎖 (Wang Yusuo), the State-owned Assets Supervision and Administration Commission of the People’s Government of Hebei Province, the State-owned Assets Supervision and Administration Commission of Shijiazhuang Municipal People’s Government and 張文中 (Zhang Wenzhong), with effective interest of 31.15%, 21.43%, 15.31% and 10.48%, respectively.

To the best knowledge, information and belief of the Directors having made all reasonable enquiries, Hebei Financial Leasing and its ultimate beneficial owners are Independent Third Parties.

— 14 —

LETTER FROM THE BOARD

IMPLICATIONS UNDER THE LISTING RULES

As the highest applicable percentage ratio set out in Rule 14.07 of the Listing Rules in respect of the Finance Lease Agreements is more than 25% but all of the applicable percentage ratios are lower than 75%, the entering into of the Finance Lease Agreements constitutes a major transaction for the Company under Chapter 14 of the Listing Rules and the Finance Lease Arrangements are therefore subject to the reporting, announcement and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

EGM

Set out on pages EGM-1 to EGM-2 of this circular is a notice of the EGM to be held at Unit 803-4, 8/F, Everbright Centre, 108 Gloucester Road, Wanchai, Hong Kong on Tuesday, 13 June 2023 at 11:00 a.m., at which ordinary resolutions will be proposed to approve the Finance Lease Arrangements.

Whether or not you propose to attend the meeting, you are requested to read the notice of EGM and complete the accompanying form of proxy, which is enclosed in this circular in accordance with the instructions printed thereon and return the same to the Company’s share registrar and transfer office, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Center, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for holding of the meeting or any adjournment thereof. Completion and return of the proxy form shall not preclude you from attending and voting at the meeting should you so wish. Pursuant to the Listing Rules, any Shareholder who has a material interest in the Finance Lease Arrangements and his/her/its close associates is/are required to abstain from voting on the relevant resolutions at the EGM.

As at the Latest Practicable Date, insofar as the Company is aware, no Shareholder has any material interest in the Finance Lease Arrangements. Hence, no Shareholder is required to abstain from voting on the resolutions in relation to the Finance Lease Arrangements at the EGM. As none of the Director is interested in the Finance Lease Arrangements, no Director has abstained from voting on the relevant Board resolutions approving the Finance Lease Arrangements.

RECOMMENDATION

The Directors consider that the terms of the Finance Lease Arrangements and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend that the Shareholders to vote in favour of the resolutions to be proposed at the EGM to approve the Finance Lease Arrangements and the transactions contemplated thereunder.

— 15 —

LETTER FROM THE BOARD

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

Yours faithfully, For and on behalf of the Board Kong Sun Holdings Limited Mr. Jiang Hengwen Chairman and non-executive Director

— 16 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. SUMMARY OF THE FINANCIAL INFORMATION OF THE GROUP

The financial information of the Group for the three years ended 31 December 2020, 2021 and 2022 are set out in the following documents which have been published on the websites of the Stock Exchange (http://www.hkex.com.hk) and the website of the Company (www.kongsun.com):

• The audited consolidated financial statements of the Group for the year ended 31 December 2020 have been set out on pages 81 to 202 of the 2020 annual report of the Company published on 20 April 2021. Please also see below the link to the 2020 annual report:

https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0420/2021042000331.pdf

• The audited consolidated financial statements of the Group for the year ended 31 December 2021 have been set out on pages 79 to 192 of the 2021 annual report of the Company published on 26 April 2022. Please also see below the link to the 2021 annual report:

https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0426/2022042601962.pdf

• The audited consolidated financial statements of the Group for the year ended 31 December 2022 have been set out on pages 88 to 197 of the 2022 annual report of the Company published on 26 April 2023. Please also see below the link to the 2022 annual report:

https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0426/2023042602663.pdf

2. WORKING CAPITAL

The Directors, after due and careful consideration and taking into account the proceeds from the Finance Lease Arrangements, the timely settlement of certain of the Group’s renewable energy subsidy receivables from the State Grid Companies on the expected dates, present internal resources and banking and other facilities and the net proceeds from the successful completion of the Previous Disposals, are of the opinion that the Group would have sufficient working capital for at least 12 months from the date of this circular. The Company has obtained the relevant confirmation as required under Rule 14.66(12) of the Listing Rules.

3. STATEMENT OF INDEBTEDNESS

As at the close of business on 31 March 2023, being the latest practicable date for the purpose of this statement of indebtedness, the Group’s indebtedness includes secured loans and borrowings amounted to approximately RMB1,976,956,000, unsecured corporate bonds amounted to approximately RMB15,661,000 and lease liabilities amounted to approximately RMB133,814,000.

— I-1 —

FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

The Group’s loans and borrowings were secured by its assets, including solar power plants, trade receivables, property, plant and equipment, lease prepayments, financial assets measured at fair value through other comprehensive income and the equity interests of certain subsidiaries.

As at 31 March 2023, the Group’s lease liabilities amounted to approximately RMB133,814,000 in relation to the remaining lease terms of certain lease contracts, which is unsecured and unguaranteed.

The Directors confirm that, as of 31 March 2023, being the latest practicable date for the purpose of this statement of indebtedness, save as disclosed above, the Group did not have any issued and outstanding, or authorised or otherwise created but unissued debt securities, term loans, other borrowings, indebtedness, mortgages and charges, contingent liabilities and guarantees.

The Directors confirm that, save as disclosed above, there have been no material changes in the indebtedness or contingent liabilities of the Group as at the Latest Practicable Date.

4. FINANCIAL AND TRADING PROSPECTS OF THE GROUP

The Group is mainly engaged in investment in and the operation of solar power plants, provision of solar power plant operation and maintenance services, provision of financial services and asset management.

In the long run, by focusing on clean energy and green finance, the Group will continue to develop its solar power generation business, optimise its operation mode and enhance the efficiency of equipment in solar power plants. Through integration of industry and finance, it will also improve its operational efficiency, so as to drive the development of green and low-carbon energy in China and make positive contributions to environmental protection.

It is expected that by entering into the Finance Lease Arrangements, the Group will be able to recycle capital, reduce its finance costs and mitigate the pressure on project financing.

Solar power generating business is a capital intensive industry, which highly relies on external financing in order to fund for the construction of solar power plant while the recovery of capital investment takes a long period of time. To cope with the gearing risk, the Group will pay close attention to the market dynamics, and to avoid any unfavorable changes to the Group.

Given the Group highly relies on external financing in order to obtain investment capital for new solar power plants development, any interest rate changes will have impact on the Group’s capital expenditure and finance costs, hence, affecting the Group’s operating results.

5. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, there has been no material adverse change in the financial or trading position of the Group since 31 December 2022, being the date to which the latest audited consolidated financial statements of the Company were made up.

— I-2 —

GENERAL INFORMATION

APPENDIX II

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERESTS

(a) Directors’ and Chief Executive’s Interests and Short Positions

As at the Latest Practicable Date, the interests and short positions of the Directors and the chief executive in the Shares, underlying Shares and debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she is taken or deemed to have under such provisions of the SFO), or as recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”) in the Listing Rules were as follows:

Interest in underlying Shares of the Company

		Number of		Approximate
		Shares held/		percentage of
Name of Director	Nature of interest	interested in	Total	shareholding
Executive Director
Xian He	Beneficial owner	1,650,000	7,125,000	0.05%
	Interest of spouse(1)	5,475,000

Note:

• (1) 5,475,000 Shares are held by Ms. He Xiang, who is the wife of Mr. Xian He. Therefore, Mr. Xian He is deemed to be interested in a long position of an aggregate of 5,475,000 Shares held by Ms. He Xiang under the SFO.

Save as disclosed above, as at the Latest Practical Date, none of the Directors and chief executive of the Company, or their respective associate, had any interests or short positions in the Shares, underlying Shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he is taken or deemed to have under such provisions of the SFO), or, as recorded in the register required to be kept by the Company under section 352 of the SFO or required to be notified to the Company or the Stock Exchange under the Model Code.

— II-1 —

GENERAL INFORMATION

APPENDIX II

(b) Substantial Shareholders’ Interests

So far as is known to any Director, as at the Latest Practicable Date, the following persons, other than a Director or chief executive of the Company, had or deemed or taken to have an interest or short position in the Shares or underlying Shares of the Company would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under Section 336 of the SFO:

		Number
		of Shares
		or underlying	Percentage of
Name	Nature of interest	Shares held(3)	shareholding(2)
Miao Yu	Deemed interest in controlled	4,169,300,000 (L)	27.86%
	corporation(1)
Prospect Ace Limited	Beneficial owner(1)	4,169,300,000 (L)	27.86%
Xiang Jun	Beneficial owner	756,831,000 (L)	5.06%

Notes:

• (1) Miao Yu owns 100% equity interest of Prospect Ace Limited. Accordingly, Miao Yu is deemed to be interested in a long position of an aggregate of 4,169,300,000 Shares held by Prospect Ace Limited.

• (2) The percentage represents the number of ordinary shares interested divided by the number of the Company’s issued shares as at the Latest Practicable Date, being 14,964,442,519 Shares.

• (3) The letter “L” denotes the person’s long position in such securities.

Save as disclosed above and as at the Latest Practicable Date, the Company had not been notified by any person, other than a Director or chief executive of the Company, who had interests or short positions in the Shares or underlying Shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or which were recorded in the register required to be kept by the Company under section 336 of the SFO.

None of the Directors or proposed Directors was a director or an employee of a company which had an interest or short position in the Shares or underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO as at the Latest Practicable Date.

— II-2 —

GENERAL INFORMATION

APPENDIX II

3. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which will not expire or is not determinable by such member of the Group within one year without payment of compensation (other than statutory compensation).

4. DIRECTORS’ INTEREST IN ASSETS

As at the Latest Practicable Date, so far as the Directors are aware, none of the Directors had any interest, either directly or indirectly, in any asset which has since 31 December 2022 (being the date to which the latest published audited consolidated financial statements of the Group were made up), up to the Latest Practicable Date, been acquired or disposed of by or leased to, any member of the Group or are proposed to be acquired or disposed of by, or leased to, any member of the Group.

5. DIRECTORS’ INTEREST IN CONTRACT OR ARRANGEMENT OF SIGNIFICANCE

No Director and/or his/her respective close associates had a material interest, either directly or indirectly, in any contract or arrangement subsisting at the date of this circular which is significant in relation to the business of the Group.

6. COMPETING INTERESTS

As at the Latest Practicable Date, as far as the Directors are aware, none of the Directors, the proposed Directors nor their respective close associates is and was interested in any business which competes or may compete, either directly or indirectly, with the business of the Group.

7. LITIGATION

As at the Latest Practicable Date, neither the Company nor any of its subsidiaries was involved in any litigation, arbitration or claim of material importance and no litigation, arbitration or claim of material importance was known to the Directors to be pending or threatened by or against the Company or any of its subsidiaries.

— II-3 —

GENERAL INFORMATION

APPENDIX II

8. MATERIAL CONTRACTS

The following material contracts (not being contracts entered into in the ordinary course of business) have been entered into by members of the Group within the two years preceding the date of this circular and up to the Latest Practicable Date and are or may be material:

• (a) the Finance Lease Agreements I, II & III and the agreements related to the Pledges I, II & III;

• (b) the finance lease agreement dated 12 April 2023 entered into between 合肥綠聚源光 伏發電有限公司 (Hefei Lvjuyuan Photovoltaic Power Generation Limited), an indirect wholly owned subsidiary of the Company (“ Hefei Lvjuyuan ”), and 國銀金 融租賃股份有限公司 (China Development Bank Financial Leasing Co., Ltd.) (“ CDB Leasing ”), pursuant to which CDB Leasing agreed to purchase certain photovoltaic power generating equipment and ancillary facilities regarding two of the 20MW photovoltaic power plants located in Hefei City, Anhui Province, the PRC from Hefei Lvjuyuan for a total consideration of RMB200,000,000 and lease such assets to Hefei Lvjuyuan for a term of 12 years for the total estimated aggregate lease payments of approximately RMB280,260,000, together with the agreement dated 12 April 2023 entered into by and among CDB Leasing, 大唐融資租賃有限公司 (Datang Finance Leasing Limited) (“ Datang Finance Leasing* ”) and Hefei Lvjuyuan in relation to the settlement of the outstanding amount due from Hefei Lvjuyuan to Datang Finance Leasing under the existing finance lease arrangement between Hefei Lvjuyuan and Datang Finance Leasing, and the relevant agreements relating to the pledges executed in relation to the finance lease agreement;

• (c) the finance lease agreement dated 7 March 2023 entered into between 嵊州懿暉光伏 發電有限公司 (Shengzhou Yihui Photovoltaic Power Generation Limited), an indirect wholly owned subsidiary of the Company (“ Shengzhou Yihui* ”), and CDB Leasing, pursuant to which CDB Leasing agreed to purchase certain photovoltaic power generating equipment and ancillary facilities regarding a 19.8MW photovoltaic power plant located in Sanjie Town, Shaoxing City, Zhejiang Province, the PRC from Shengzhou Yihui for a total consideration of RMB110,000,000 and lease such assets to Shengzhou Yihui for a term of 12 years for the total estimated aggregate lease payments of approximately RMB153,486,000;

• (d) the finance lease agreement dated 27 February 2023 entered into between 定邊縣智 信達新能源有限公司 (Dingbian County Zhixinda New Energy Limited), an indirect wholly owned subsidiary of the Company (“ Dingbian County ”), and 華電融資租賃 有限公司 (Huadian Financial Leasing Co., Ltd.) (“ Huadian Financial Leasing ”), pursuant to which Huadian Financial Leasing agreed to purchase certain photovoltaic power generating equipment and ancillary facilities regarding a 50MW photovoltaic power plant located in Yulin City, Shaanxi Province, the PRC from Dingbian County for a total consideration of RMB260,000,000 and lease such assets to Dingbian County for a term of 10 years for the total estimated aggregate lease payments of approximately RMB349,842,000;

— II-4 —

APPENDIX II

GENERAL INFORMATION

• (e) the finance lease agreement dated 12 December 2022 entered into between 大同市皖 銅新能源有限公司 (Datong Wantong New Energy Co., Ltd.), an indirect non-wholly owned subsidiary of the Company (“ Datong Wantong* ”), and Hebei Financial Leasing, pursuant to which Hebei Financial Leasing agreed to purchase certain photovoltaic power generating equipment and ancillary facilities regarding a 20MW photovoltaic power plant located in Datong City, Shanxi Province, the PRC from Datong Wantong for a total consideration of RMB80,000,000 and lease such assets to Datong Wantong for a term of 10 years for the total estimated aggregate lease payments of approximately RMB108,387,000;

• (f) the partnership agreement dated 11 November 2022 entered into by and among Kong Sun Yongtai, 上海仟榮臻投資諮詢有限公司 (Shanghai Qianrongzhen Investment Consultancy Co., Ltd.) and 西藏玄彤投資有限公司 (Xizang Xuantong Investment Co., Ltd.) as limited partners, 深圳市前海燊泰新能源投資管理有限公司 (Shenzhen Shenzhen Shentai New Energy Investment Management Co., Ltd.) as a general partner and 霍爾果斯江山華飛利如股權投資有限公司 (Khorgos Jiangshan Huafei Liru Investment Equity Management Co., Ltd.) as a general partner and executive partner in relation to the formation of 北京紅楓新能源合夥企業（有限合夥） (Beijing Hong Kong New Energy Investment Partnership (Limited Partnership)*), pursuant to which a capital commitment of RMB200,000,000 was to be contributed by Kong Sun Yongtai, representing approximately 90.10% of the total capital contribution in such limited partnership;

• (g) the loan agreement dated 1 November 2022 entered into between Kong Sun Yongtai as the lender and 江山寶源國際融資租賃有限公司 (Kong Sun Baoyuan International Financial Leasing Limited*), an associate of the Company which is indirectly owned as to 37.6% equity interest by BD Technology Limited, a wholly-owned subsidiary of the Company, as the borrower, pursuant to which Kong Sun Yongtai agreed to grant the loan in the principal amount of RMB120,000,000 to the borrower at an interest rate of 9% per annum for a term of 36 months;

• (h) the equity transfer agreement dated 25 March 2022 entered into by and among 中原 新華水利水電投資有限公司 (Zhongyuan Xinhua Water Resources and Hydropower Investment Limited) (“ Zhongyuan Xinhua ”), Kong Sun Yongtai and 濟源大峪江 山光伏發電有限公司 (Jiyuan Dayu Jiangshan Photovoltaic Power Generation Limited) (“ Jiyuan Dayu Jiangshan ”) in relation to the disposal of the entire equity interests of Jiyuan Dayu Jiangshan for a total consideration of RMB34,400,000;

• (i) the equity transfer agreement dated 25 March 2022 entered into by and among Kong Sun Yongtai, Zhongyuan Xinhua and 寶豐縣鑫泰光伏電力科技開發有限公司 (Baofeng Xintai Photovoltaic Power Technology Development Limited) (“ Baofeng Xintai* ”) in relation to the disposal of 50% equity interests of Baofeng Xintai held by Kong Sun Yongtai and the rights of Kong Sun Yongtai as the ultimate beneficial owner of Baofeng Xintai for a total consideration of RMB84,275,000;

— II-5 —

APPENDIX II

GENERAL INFORMATION

• (j) the disposal agreements dated 2 November 2021 entered into between, among others, Kong Sun Yongtai, 新疆誠石易盛商貿有限公司 (Xinjiang Chengshi Yisheng Trading Co., Ltd.) (“ Xinjiang Chengshi ”) and 新華電力發展投資有限公司 (Xinhua Electricity Development Investment Limited) (“ Xinhua Electricity* ”) in relation to the disposals of seven project companies from Kong Sun Yongtai and Xinjiang Chengshi to Xinhua Electricity for a total consideration of RMB242,130,000; and

• (k) the disposal agreements dated 10 July 2021 entered into between, among others, Kong Sun Yongtai, Jiaxing Shengshi Limited Partnership, Changshu Honglue and Suzhou Junsheng Limited Partnership (as the case may be) and Xinhua Electricity in relation to the disposals of the entire equity interests of 金塔縣永嘉新能源有限公司 (Jinta Yongjia New Energy Limited), 甘肅宏遠光電有限責任公司 (Gansu Hongyuan Photovoltaic Limited), 敦煌萬發新能源有限公司 (Dunhuang Wanfa New Energy Limited Company), 化隆縣瑞啟達新能源有限公司 (Hualong County Ruiqida New Energy Limited), 黃驊市正陽新能源有限公司 (Huanghua Zhengyang New Energy Limited), 嘉峪關協合新能源有限公司 (Jiayuguan Xiehe New Energy Co. Ltd.) and 臨潭天朗新能源科技有限公司 (Lintan Tianlang New Energy Technology Co., Ltd.*) for a total consideration of RMB1,285,814,000.

9. MISCELLANEOUS

• (a) The company secretary of the Company is Mr. Ching Kin Wai, who is a member of the Hong Kong Institute of Certified Public Accountants;

• (b) The registered office and the principal place of business of the Company is at Unit 803-4, 8/F, Everbright Centre, 108 Gloucester Road, Wanchai, Hong Kong;

• (c) The share registrar of the Company is Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong; and

• (d) This circular has been prepared in both English and Chinese. In the case of any discrepancies, the English texts shall prevail over their respective Chinese texts.

10. DOCUMENTS ON DISPLAY

Copies of the Finance Lease Agreements I, II & III and the agreements related to the Pledges I, II & III will be available on display online on the Stock Exchange’s website (www.hkexnews.hk) and on the Company’s website (www.kongsun.com) for a period of 14 days from the date of this circular.

— II-6 —

NOTICE OF THE EGM

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KONG SUN HOLDINGS LIMITED 江 山 控 股 有 限 公 司

(Incorporated in Hong Kong with limited liability)

(Stock Code: 295)

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting (the “ EGM ”) of Kong Sun Holdings Limited (the “ Company ”) will be held at Unit 803-4, 8/F, Everbright Centre, 108 Gloucester Road, Wanchai, Hong Kong on Tuesday, 13 June 2023 at 11:00 a.m. for the purposes of considering and, if thought fit, passing, with or without amendments, the following resolutions as ordinary resolutions of the Company:

ORDINARY RESOLUTIONS

Words and expressions that are not expressly defined in this notice shall bear the same meaning as that defined in the circular dated 25 May 2023 of the Company.

1. “ THAT :

2. (i) the Finance Lease Agreement I and the relevant agreements relating to the Pledges I (copies of which have been tabled at the meeting marked “A” and signed by the chairman of the meeting for identification purpose) and the transactions contemplated thereunder, be and are hereby approved, ratified and confirmed; and

3. (ii) any one Director be and is authorised to do all such things and take all such actions as he or she may consider necessary or desirable to implement and/or give effect to the Finance Lease Agreement I, the relevant agreements relating to the Pledges I and the transactions contemplated thereunder.”

4. “ THAT :

5. (i) the Finance Lease Agreement II and the relevant agreements relating to the Pledges II (copies of which have been tabled at the meeting marked “B” and signed by the chairman of the meeting for identification purpose) and the transactions contemplated thereunder, be and are hereby approved, ratified and confirmed; and

6. (ii) any one Director be and is authorised to do all such things and take all such actions as he or she may consider necessary or desirable to implement and/or give effect to the Finance Lease Agreement II, the relevant agreements relating to the Pledges II and the transactions contemplated thereunder.”

— EGM-1 —

NOTICE OF THE EGM

1. “ THAT :

2. (i) the Finance Lease Agreement III and the relevant agreements relating to the Pledges III (copies of which have been tabled at the meeting marked “C” and signed by the chairman of the meeting for identification purpose) and the transactions contemplated thereunder, be and are hereby approved, ratified and confirmed; and

3. (ii) any one Director be and is authorised to do all such things and take all such actions as he or she may consider necessary or desirable to implement and/or give effect to the Finance Lease Agreement III, the relevant agreements relating to the Pledges III and the transactions contemplated thereunder.”

By Order of the Board Kong Sun Holdings Limited Mr. Jiang Hengwen Chairman and non-executive Director

Hong Kong, 25 May 2023

Notes:

1. Any member of the Company entitled to attend and vote at the meeting is entitled to appoint one or more proxies (who must be an individual) to attend and, on a poll, vote in his/her stead. A proxy need not be a member of the Company.

2. To be valid, the form of proxy, together with the power of attorney or other authority (if any) under which it is signed or a notarially certified copy thereof must be lodged with the Company’s share registrar, Computershare Hong Kong Investors Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof. Completion and return of the form of proxy will not preclude a member from attending and voting in person at the meeting.

3. Where there are joint registered holders of any share, any one of such persons may vote at any meeting, either personally or by proxy, in respect of such share as if he/she were solely entitled thereto; but if more than one of such joint holders are present at any meeting personally or by proxy, that one of the said persons so present being the most or, as the case may be, the more senior shall alone be entitled to vote in respect of the relevant joint holding and, for this purpose, seniority shall be determined by reference to the order in which the names of the joint holders stand on the register of members in respect of the relevant joint holding.

As of the date of this notice, the Board comprises one executive Director, Mr. Xian He, one non-executive Director, Mr. Jiang Hengwen, and three independent non-executive Directors, Ms. Tang Yinghong, Ms. Wu Wennan and Mr. Xu Xiang.

— EGM-2 —