*The two directors of ST King Kong voted against the company's third quarterly report and said that corporate governance has been seriously out of line

Recently, *ST King Kong issued an announcement that the company held a board of directors to deliberate and pass the "Third Quarter Report of 2021" and "Proposal on Applying for a Comprehensive Credit Line from a Financial Institution". It is worth noting that the voting results of the two bills were: 6 votes in favor, 2 votes against and 0 abstentions, 6 votes in favor, 0 votes against and 2 abstentions.

Among them, the dissenting votes were all voted by directors Liu Miao and Wang Daping. For the *ST King Kong Third Quarterly Report, the two said that since 2021, Agricultural Investment Financial Holdings and Shanghai Xinghan Capital have repeatedly exercised shareholder rights in terms of corporate governance, and I have also urged the company to ensure that Agricultural Investment Financial Holdings and Shanghai Xinghan Capital exercise their rights in accordance with the provisions of the Company Law and the company's articles of association, but the company and the actual controller maliciously obstructed agricultural investment financial holdings and Shanghai Xinghan Capital to exercise shareholder rights, and corporate governance was seriously out of norms, and the Notice also revealed many problems in corporate governance and internal control, which was supported by the company's announcement.

Combined with the company's inability to guarantee the legal compliance of corporate governance, the company's 2020 annual audit report being qualified, and the company's failure to have a clear response to the exchange inquiry "retrospective restatement", I am unable to recognize the continuity and specific information of the third quarter financial statement data.

It is reported that as of September 30, 2021, Shanghai Xinghan Capital and Agricultural Investment Financial Holdings are the second and third largest shareholders of *ST King Kong, respectively, Liu Miao is currently the deputy general manager of Henan Agricultural Investment Financial Holdings Co., Ltd., and Wang Daping is currently a director of Henan SME Investment Guarantee Co., Ltd. and other companies.

Regarding the proposal to apply to financial institutions for a comprehensive credit line of not more than 145 million yuan, the two said that the principal and interest of the company's loans to all banks and other financial institutions are overdue, and some banks and financial institutions have launched lawsuits against the company, and it is unlikely that the comprehensive credit extension from financial institutions will be approved under the current conditions. According to the company's third quarterly report, the cash flow from operating activities in the first three quarters was 64.8031 million yuan, and the purpose of the company's financing funds is not clear. It is recommended to focus on solving the problem of the occupation of the funds of the actual controller of the company, so as to avoid the company's funds being occupied by the actual controller again.

It is understood that on August 13, 2021, the CSRC found that *ST King Kong's net assets at the end of 2019 were inflated by 1.856 billion yuan, and the annual report showed that the company's net assets from 2019 to 2020 were 1.721 billion yuan and -1.236 billion yuan, and then the company or was forced to delist by major violations.

*ST King Kong's 2019 annual financial statements and notes to the financial statements have been issued with a qualified opinion in the "Audit Report", and the qualified opinion has not been eliminated as of now. The Company's 2020 annual financial statements and notes to the financial statements were issued with an Audit Report that could not express an opinion, and the Company's shares were delisted from the market opening on April 28, 2021.

In addition, *ST King Kong has a passive flow of funds to the actual controller Guo Liuxi and Henan Huajing Superhard Materials Co., Ltd., as of September 30, the balance of funds involved is still 305 million yuan. The company is involved in a number of litigation/arbitration cases, with a total amount of more than 5 billion yuan.

At present, *ST King Kong learned through the national bankruptcy enterprise reorganization case information network inquiry that the company has been applied for bankruptcy reorganization by the creditor Henan Linchuan Construction Engineering Co., Ltd.