Kunming Dianchi Water Treatment Co., Ltd. (DCWT) signed the fourth Entrusted Loan Extension Agreement and a supplemental agreement with Kunming Development and Chenggong District Rural Credit Cooperative on 12 May 2026, prolonging the RMB200 million entrusted loan’s maturity by 11 months to 24 May 2027. All other contractual terms remain unchanged.

The interest rate stays fixed at 6.00% per annum—300 basis points above the one-year prime rate (3.00% as of 20 April 2026). Over the new term the loan is expected to contribute approximately RMB11.00 million in interest income to DCWT. A one-off service fee equal to 0.10% of the extension amount (RMB0.20 million) will be paid by DCWT to the trustee within five working days of the transaction’s execution. Principal will continue to be repaid in a lump sum at maturity, with quarterly interest payments due on the 20th day of each quarter’s final month. Early repayment rights for DCWT remain in place.

Kunming Development has settled all accrued interest to date, leaving no outstanding balance other than the principal.

Given that the applicable percentage ratios for the transaction exceed 25% but are below 75%, the extension constitutes a major transaction under Chapter 14 of the Hong Kong Listing Rules. DCWT will convene a shareholders’ meeting to seek approval and will issue a circular by 2 June 2026. Failure to secure approval would trigger immediate repayment by Kunming Development of the RMB200 million principal plus accrued interest within three business days after 30 July 2026.

The extension does not involve additional cash outlay beyond the existing principal already recognised in DCWT’s financial statements up to 31 December 2025.

Kunming Development, wholly owned by Kunming SASAC, operates across new energy, concessions, commodity trading and urban commercial services. Chenggong District Rural Credit Cooperative, owned by Yunnan Rural Credit Cooperative Association, acts as the trustee for the entrusted loan.