CHINANEWTOWN's subsidiary, Xincheng Kaiyuan, provides guarantees for the exhibition period loan of Nanjing Guoying Zhongxi Construction

According to the announcement from CHINANEWTOWN (01278), on January 21, 2021, Xin Cheng Kai Yuan (a wholly-owned subsidiary of the company) entered into a guarantee with Jiangsu Province Construction, with the bank as the beneficiary, for a bank loan in 2021. Xin Cheng Kai Yuan and Jiangsu Province Construction have each agreed to guarantee the timely repayment of the 2021 bank loan (including interest) based on their respective equity ratios in the joint venture (Nanjing Guo Ying Zhong Xi Construction). On October 22, 2025, the joint venture (as the borrower), the bank (as the lender), Xin Cheng Kai Yuan (as the guarantor), and Jiangsu Province Construction (as the guarantor) entered into a loan extension agreement for 2025, extending the maturity date and repayment schedule of the 2021 bank loan by two years, from January 4, 2031 (before the extension) to January 4, 2033 (after the extension) (i.e., the extended loan). The guarantors of the 2021 guarantee, Xin Cheng Kai Yuan and Jiangsu Province Construction, must continue to guarantee the timely repayment of the extended loan based on the guarantee ratio under the 2021 guarantee (i.e., each guarantor accounts for 50%). As of the date of this announcement, the joint venture owes the bank an outstanding principal amount of approximately RMB 423 million under the extended loan. Given the macroeconomic environment and the financial condition of the joint venture, the loan extension is a proactive measure to manage potential risks for the joint venture and the group. By extending the 2021 bank loan (i.e., the extended loan) and the 2021 guarantee (i.e., the 2025 guarantee), the guarantors (Xin Cheng Kai Yuan and Jiangsu Province Construction) continue to provide guarantees for the joint venture at the original guarantee ratio (each guarantor accounts for 50%), without increasing or expanding risks. Therefore, providing financial support for 2025 will give the joint venture more time and space to arrange and optimize its financial and operational efficiency, providing a more stable environment for the joint venture, thereby reducing the risk of triggering the 2021 guarantee of Xin Cheng Kai Yuan and alleviating the pressure on the group's financial performance and liquidity. Thus, the financial support for 2025 is a more cost-effective solution for managing the potential risks faced by the joint venture. As mentioned above, the terms of the financial support for 2025 were fairly negotiated by the parties to the loan extension agreement, considering the financial condition of the joint venture and aiming to manage the potential risks it faces and avoid triggering the potential risks of the 2021 guarantee. In addition, the company notes that the joint venture has been attempting to implement various measures to optimize its operational and financial capabilities, especially considering multiple measures to improve the operational efficiency and rental rate of its properties, implement strict cost control, accelerate capital recovery through exploring various asset disposal plans, and reduce overall financial costs through structured financing. Furthermore, providing financial support for 2025 also helps maintain the stable operation and continuity of the international school (whose premises are leased by the joint venture as the lessor), avoiding potential adverse impacts on normal educational activities on campus at this stage. The board believes that this not only upholds the group's image of social responsibility as a state-owned enterprise but also ensures a stable rental income source for the joint venture and maintains the corporate value of the joint venture