The Board of Directors of Cuckoo Electronics Co., Ltd. resolved to spin-off Cuckoo Homesys Co., Ltd. on July 13, 2017. The shareholders of Cuckoo Electronics Co. will be receiving shares of Cuckoo Homesys Co.

proportionate to the equity ratio on the record date for new shares allotment. The record date of the transaction is December 1, 2017. After the spin-off, the issued shares of Cuckoo Homesys Co.

will be re-listed following the KOSPI Market Listing Regulation of the Korea Exchange upon passing the re-listing examination and the issued shares of Cuckoo Electronics Co. will have change listing. The demerger would create Cuckoo Holdings from the investment unit and Cuckoo Homesys from the rental unit.

Cuckoo Holdings will fully own Cuckoo Electronics and make it an unlisted subsidiary. The Cuckoo Homesys reported total assets of KRW 337 billion and total capital of KRW 290 billion as of March 31, 2017. The spun-off business will be named as Cuckoo Homesys Co., Ltd. The general meeting of shareholders' of Cuckoo Electronics Co.

is scheduled to take place on October 31, 2017. The spin-off plan was approved at the extraordinary shareholders' meeting on October 31, 2017. The new shares are expected to be listed on stock exchange on January 11, 2018.