China Qinfa Group Limited announced that a major lending bank of the Group has sold the outstanding debts owed by a subsidiary of the Group of approximately RMB 598,968,910 in total comprised of debts with principal amount of approximately RMB 492,443,378 and related accrued interest of approximately RMB 106,525,532 in total as at 31 May 2018 to a domestic asset management company (the "Current Creditor") by way of discounting. The transactions were commercial decision between the Original Creditor and the Current Creditor. As at 20 June 2021, the Original Debt of approximately RMB 754,088,649 in total comprised of debt with principal amount of approximately RMB 492,443,378 and related accrued interest of approximately RMB 261,645,271. On 13 December 2021, the Group and the Current Creditor reached a loan restructuring proposal for the repayment of the Original Debt. According to the Proposal, the Current Creditor agreed to reduce the Original Debt by approximately RMB 404,088,649. Thus, the principal balance of the outstanding debt shall be in total RMB 435,636,667 comprised of principal amount of approximately RMB 350,000,000 and capital occupation fee of RMB 85,636,667. The Current Creditor agreed that the Group shall repay the Current Debt in 3 years. According to the Proposal, the Group shall be entitled to early repayment of the Current Debt and the capital occupation fee shall be revised accordingly. On the contrary, according to the Proposal, if the Group is unable to repay the Current Debt on time, the Current Creditor shall have the right to withdraw the Debt Reduction granted to the Group.