VALA (02051) has issued an announcement stating that on February 5, 2026, Hangzhou Enniu, Hangzhou Zhenniu, Hangzhou Shangniu, Mr. Yang, entities connected to Mr. Yang, and a member company of Shouhui Group have entered into a settlement agreement regarding the settlement matters. The Group's legal counsel in China has indicated that there is uncertainty regarding whether the Hangzhou Arbitration Commission will rule in the Group's favor in the arbitration proceedings involving Mr. Yang. If the Hangzhou Arbitration Commission does not rule favorably for the Group in these proceedings, the Group will be unable to, among other things, rescind the acquisition agreement. Furthermore, if Mr. Yang and/or his associates are able to obtain confirmation from the People's Bank of China, the Group will still be obligated to fulfill the payment of the remaining cash consideration, approximately RMB 92 million of which is payable to Mr. Yang and his connected entities, despite having lost operational and management control over Shouhui Group since August 3, 2022, with no guarantee of regaining control under any circumstances.

Considering the significant adverse consequences for the Group should the arbitration yield an unfavorable result, alongside the risk of an unfavorable ruling from the Hangzhou Arbitration Commission, and the additional time and legal costs associated with continuing these protracted proceedings, the Board of Directors believes that proceeding with the settlement matters with Mr. Yang and his connected entities is in the best interests of the Company and its shareholders. Regarding the recoverability of the debt, the Group's management considers the settlement the most viable option to ensure partial repayment, taking into account the amounts already recovered. The Board also believes that obtaining the attributable economic benefits from a total of 12.9365% equity in Shouhui Kaizhuo, coupled with the payment of a cash incentive to Mr. Yang to facilitate the sale of all equity in Shouhui Kaizhuo, presents a significant opportunity for the Group to recover a portion of its investment in Shouhui Group and collect part of the debt. This equity includes the 12.9365% stake associated with the economic benefits, approximately 19.12% held by the Group through Tiantu Investments and Tianjin Tiantu Xinghua under a nominee arrangement pursuant to the Tiantu settlement, and approximately 26.92% held under a nominee arrangement through other former shareholders.