People's Government of Suncun Town entered into a conditional agreement to acquire Fanchang Dianchi Water Treatment Co., Ltd. from Kunming Dianchi Water Treatment Co., Ltd. (SEHK:3768) for approximately CNY 150 million on June 29, 2022. Under the terms, the consideration includes equity transfer price of CNY 65.9 million borrowings of CNY 88.4 million of which the principle is CNY 80.9 million and interest is CNY 7.5 million. The consideration will be paid in three installments: approximately CNY 100 million within 5 working days from the effective date of the Equity Transfer Agreement, including the equity transfer price of CNY 65.9 million and the principal of the project construction borrowings of CNY 38 million; the second installment includes the operating costs for the principal and interests of the daily operation borrowings for the transitional period, based on the results of the audit report, to be paid within 7 working days after the issuance of audit report; and the third installment includes the principal amount of the remaining project construction borrowings of CNY 42.9 million and all interest accrued on the project construction borrowings, to be be paid within 5 working days upon completion of legal procedures. In the year ending on December 31, 2021, Fanchang Dianchi Water generated net profit before taxation of CNY 1.3 million, net profit after taxation of CNY 1.2 million and had net assets of CNY 52.9 million. Baker Tilly Hong Kong Business Services Limited acted as an accountant and ZhongHe Appraisal acted as advisor to Kunming Dianchi Water Treatment.

People's Government of Suncun Town Completed the acquisition of Fanchang Dianchi Water Treatment Co., Ltd. from Kunming Dianchi Water Treatment Co., Ltd. (SEHK:3768) on November 18, 2022.