Kunming Dianchi Water Treatment Co., Ltd. entered into the entrusted loan contract with Kunming Development and Bank of Communications on 17 June 2021, pursuant to which the Company entrusts Bank of Communications to provide a RMB 200 million loan to Kunming Development. As at the date of this announcement, the aforementioned entrusted loan of RMB 200 million has not yet fallen due. The Board announces that the Company entered into the Second Corporate Entrusted Loan Contract with Kunming Development and Bank of China on 11 October 2021, pursuant to which the Company entrusts Bank of China to provide a RMB 100 million loan to Kunming Development. As the borrower under the First Corporate Entrusted Loan Contract and the Second Corporate Entrusted Loan Contract are the same, the transactions contemplated under the First Corporate Entrusted Loan Contract and the Second Corporate Entrusted Loan Contract shall be aggregated according to Rule 14.22 of the Listing Rules. As the highest applicable percentage ratio of the First Corporate Entrusted Loan Contract and the Second Corporate Entrusted Loan Contract exceeds 5% but all of the applicable percentage ratios are lower than 25% when calculated on an aggregated basis under Rule 14.07 of the Listing Rules, the Entrusted Loan Transaction constitutes a disclosable transaction of the Company and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.