The hotel commission management agreement between Zhejiang Hu Han Yong and Jiaokong will terminate on May 31, 2024. The agreement allows Jiaokong to be responsible for the operation and management of Zhejiang HK&S Hotels within the agreed period, and determine the transaction amount based on performance commitments. If Jiaokong fails to meet the performance commitments, compensation must be paid to Zhejiang HK&S Hotels. In 2023, the revenue of Zhejiang HK&S Hotels was approximately RMB 41.76 million, and the management fee was approximately RMB 2.08 million. Jiaokong paid approximately RMB 17.43 million in compensation to Zhejiang HK&S Hotels due to the failure to meet the performance commitments. The compensation for January to May 2024 will be calculated based on the actual GOP value after...Show More

The hotel commission management agreement between Zhejiang Hu Han Yong and Jiaokong will terminate on May 31, 2024. The agreement allows Jiaokong to be responsible for the operation and management of Zhejiang HK&S Hotels within the agreed period, and determine the transaction amount based on performance commitments. If Jiaokong fails to meet the performance commitments, compensation must be paid to Zhejiang HK&S Hotels. In 2023, the revenue of Zhejiang HK&S Hotels was approximately RMB 41.76 million, and the management fee was approximately RMB 2.08 million. Jiaokong paid approximately RMB 17.43 million in compensation to Zhejiang HK&S Hotels due to the failure to meet the performance commitments. The compensation for January to May 2024 will be calculated based on the actual GOP value after special audit. The termination of the agreement is considered to be in the best interest of the company and shareholders as it will allow the company to regain full control over Zhejiang HK&S Hotels. The termination agreement constitutes a related party transaction, but is exempt from independent shareholder approval under the listing rules.