Million Cities (HKG:2892) subsidiary Huizhou Jiahong Information Consulting has agreed to provide a 39 million yuan loan to Huizhou Shengtaichang Information Consulting for a 12-month term, according to a Tuesday filing with the Hong Kong bourse.

The loan carries an annual interest rate of 3.5%, payable quarterly, and is set to mature on December 24, 2025.

Under the terms, if Huizhou Shengtaichang does not use the loan for its intended purpose, which is for general working capital, Huizhou Jiahong may demand early repayment.

Additionally, in the event of a default, Huizhou Jiahong may impose a penalty fee of 0.03% from the repayment due date.

Before the loan agreement, Huizhou Shengtaichang acquired carparks valued at 39 million yuan from Huizhou Million Cities Real Estate Development, another subsidiary of the company. The titles for these carparks have not yet been transferred to the borrower, the filing said.

Under the loan agreement, the transfer of the titles will be suspended until the loan obligations are fulfilled. If the borrower fails to meet these obligations, the lender may instruct Huizhou Million Cities to sell the carparks.