WATER INDUSTRY (01129) Received a Reminder Letter for Payment

Water Industry (01129) announces that a creditor, Zhao Yuan (the second-ranking creditor), has submitted a notice regarding their intention to attend the hearing on the liquidation application filed by the International Finance Corporation on November 25, 2025. The creditor has claimed an outstanding debt of 2.0125 million Hong Kong dollars (the principal amount of the bonds issued by the company on April 18, 2018, along with the accumulated unpaid interest). The hearing is scheduled for January 21, 2026, and the creditor has expressed their support for the liquidation application against the company. As of the date of this announcement, no liquidation order has been issued by the court for the company. As disclosed in previous announcements, the company is seeking advice from its legal advisors to determine the next steps regarding the application and possible actions to be taken. The company will strive to maintain proactive and good communication with the applicant and the supporting creditors and will negotiate in a friendly manner to resolve issues (including efforts to facilitate the withdrawal of the application as soon as possible) in a fair manner to other creditors. On March 19, 2021, the company's wholly-owned subsidiary, China Water Industry (Hong Kong) Limited (the borrower), entered into a loan agreement with Kin Yip Finance Limited (the lender) for a secured loan in the amount of 80 million Hong Kong dollars. Based on the guarantee issued by the company to the lender on March 19, 2021, the company has provided a guarantee for the obligations of the borrower under the loan agreement and other financing and guarantee documents. As of the date of this announcement, the outstanding principal amount of the loan is 50 million Hong Kong dollars. On November 24, 2025, the borrower received a demand letter from the lender's legal representative claiming that the borrower was in default on the loan and requesting repayment of the outstanding amount under the loan agreement by November 26, 2025. If the payment is not made by the deadline, the lender will seek necessary legal action to recover the outstanding amount along with all accumulated interest, legal fees, and expenses without further notice. The company is currently seeking professional advice on possible actions to settle the outstanding amount, including but not limited to legal and financial advice. The management will make every effort to negotiate with the lender on the possibility of postponing the repayment date and explore other feasible solutions.