Gelonghui Group (01418.HK) announced that on April 10, 2024, Sinomax Vietnam HP, an indirect wholly-owned subsidiary of the company, signed a factory lease agreement with Hoang Long (as the owner). Based on this, Hoang Long has agreed to lease these properties to Sinomax Vietnam HP for a period of five years from the effective date, that is, from April 1, 2024 to March 31, 2029. The total monthly rent for these properties (excluding VAT, management fees and utilities) is approximately USD 40,365.00 for the first year of the term, USD 42,383.25 for the second year of the term, USD 44,536.05 for the third year, approximately USD 46,688.85 for the fourth year of the term, and approximately USD 48,976.20 for the fifth year of the term.

Such properties, i.e. ready-made factories and ancillary facilities located on construction sites, include: (i) a 13,455 square metre factory (“factory”); and (ii) janitorial and sanitation works (“other areas”).

Since 2019, the Group has leased these properties to Hoang Long for its production facilities in Vietnam, based on which the Group produces end consumer health and household products. Since 2019, the Group has invested resources to build plants and supporting facilities at the construction site to meet its operating needs. The production facilities have been approved by many of the Group's customers and can produce its products in Vietnam. The relevant factory lease agreement between Sinomax Vietnam HP and Hoang Long expired on March 31, 2024. In order to ensure the smooth operation of the Group's business in Vietnam, the Board of Directors believes that the Group needs to continue leasing such properties for operation.