ZHONG AO HOME (01538) has announced the termination of its joint venture agreement. The decision follows a review by its wholly-owned subsidiary, Xin Zhao, regarding the proposed partnership with Ms. Jiang Caiying.

Under the original terms, the parties agreed to jointly operate a joint venture group, with conversion rights allowing for the issuance of up to 329 million conversion shares at an initial conversion price of HK$0.93 per share, subject to adjustment. The agreement was conditional upon all prerequisites being fulfilled by September 30, 2026; otherwise, it would lapse without any liability or obligation for the parties involved.

Since signing the agreement, Xin Zhao has been conducting ongoing due diligence on all aspects of the joint venture and its proposed transactions, including restructuring progress, operational team formation, and business development. However, it became apparent that all conditions precedent under the agreement would not be satisfied by the specified deadline. Consequently, on August 18, 2026, Xin Zhao formally notified Ms. Jiang of the immediate termination of the agreement.

The board believes that this termination will not have any significant adverse impact on the group's business, operations, or financial position. As the joint venture agreement has been terminated, no circular will be dispatched to shareholders, and no extraordinary general meeting will be convened.