A letter from the CEO to our Global Business Partner
Date: 23 FEB, 2021
Dear Partners,

It has now been more than a year since we have last seen each other and exchanged glances and
views. Despite the challenges we have experienced over the past 12 months, we have grown together
and become stronger.
However, thanks to the latest developments in research and healthcare, the worst is now behind us.
I always like to repeat that as Homa, we place a lot of importance on our partnerships, and our goal is
to be "your supplier of choice".
So once again, I would like to draw your attention to the recent developments in Homa.

POSITIVE BUSINESS PERFORMANCE IN 2020
Although the pandemic has brought consequences on all our international markets, we have still
managed to grow the business. We have reported a sound and healthy turnover of 8.3 Bio CNY
(16.1% over 2019) and sales volume of 11.0 Mio units (17.3% over 2019). These are record numbers in
Homa history. We are very proud that all global customers appreciate our leading-edge products
and services.
Our 2021 budget is to increase sales volume to 13.0 Mio units and a turnover to 10.0 Bio CNY. We
are confident to attain our goals with your support.

THE 2021/2022 HUGE INVESTMENT PLAN
We are building our new No-Frost district (Factory No.8 & Factory No.9), representing a paramount
investment of more than 1.2 Bio CNY.
The No-Frost district will be up and running by March 2022 and produce additional 3.0 Mio units per
year, bringing total output by then to 16 Mio units, thus consolidating our OEM/ODM global
leadership.

UNCHANGED SPIRIT
The new normal is in front of us. We will firmly stick to our current business model and strategy and
serve our clients' needs and aspirations as we have always done. We will continue to develop products
with meaningful, game-changing innovation and state of the art design.
Our vision is to become the best producer in the cooling industry. Our mission is to produce cooling
appliance with the most competitive way.

HOMA HOLDING SHAREHOLDING STRUCTURE CHANGE
As you have known, our parent company Homa Holding Co., Ltd. (HHL), has experienced substantial
financial distress in 2018, deriving from the P2P investment.
In the past two years, this was addressed by HHL by spinning off non-core assets, thus improving the
financial position.
In October 2020, HHL announced a capital increase initiative in the form of a private placement. A
new shareholder, Beihai Qingyun Technology Co., Ltd. (BQT) agreed to buy 30% of HHL new equity
by paying 1.2 billion CNY. This deal is awaiting final approval by the stock exchange authority.
Meanwhile, since January 2021, a private company Huizhou TCL Household Electric Appliance Co.,
Ltd. (HTHEA), has gradually purchased 10% share of HHL from the stock market.
The above moves changed the shareholder structure of HHL.
The primary shareholders and actual beneficial owners may be within Mr. Guodong Zhao (>12%
today), BQT (30% if approved by authority) and HTHEA (>10% today).

HOMA APPLIANCES STILL AN INDEPENDENT, SELF-GOVERNING SUBSIDIARY
Please note, the above new shareholder structure of HHL, does not impact Homa Appliances Co. Ltd.
(HAC). As per HAC Articles of Association:
- HAC is entirely independent of its parent company HHL regarding governance, management,
operations and treasury.
- to manage changes in the HAC board, 66% of share is needed.
Since 2015, HAC has been spun off from HHL and kept independent.
We are technically an independent subsidiary of HHL.
In February 2020, the Homa Appliances Founding Members acquired a 39% HAC stake from parent
company HHL to strengthen HAC's independence further.
Because of the successful business of HAC, the local government also keep 10% stake as a pure
financial investor.
Today HAC's shareholders are HHL (51%), HAC Founding Members (39%) and Local Government
(10%).As for Homa Appliances Co, Ltd., I want to confirm the following:
• The Board of Director has no any change.
They are still 5 Homa founders since 2003, namely Mr. Shier Cai, Mr. Jianquan Cai, Mr. Michael Yao,
Mr. David Wang and Mr. Simon Wu.
•The Top Management appointed by Board of Director also remains unchanged.
They are President Michael Yao, VP David Wang, VP Simon Wu, VP Bob Yu and VP Peter Liu.
No one from HHL or the local government has a role in HAC.
In effect, under the terms of our Articles of Association, HAC is a legal entity that operates in
complete autonomy.
If you have any questions about the above, please feel free to let us know.

CONCLUSIONS
Our business has been growing over the past 18 years.
The facts demonstrate the goodness of the long-term strategy, the consolidated ability of top
management to execute plans and this thanks to our professional teams.
The real value of Homa Appliances does not merely lie in its "tangible assets" like factories and
equipment, but its "soft assets", such as:
- the "pure ODM" business model.
- the long-lasting relationship established with its worldwide network of clients and partners.
- the culture, the people and the values.
Please rest assured, we will continue to develop our business with this philosophy in mind.
So, let's stay in touch and continue to look forward together.
Best wishes,

Michael Yao
CEO & President,
Homa Appliances Co., Ltd.