diff --git a/python/CHANGELOG.md b/python/CHANGELOG.md
index b9bb82d6e7..23902b77c9 100644
--- a/python/CHANGELOG.md
+++ b/python/CHANGELOG.md
@@ -7,6 +7,28 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 ## [Unreleased]
 
+## [1.0.0b251216] - 2025-12-16
+
+### Added
+
+- **agent-framework-ollama**: Ollama connector for Agent Framework (#1104)
+- **agent-framework-core**: Added custom args and thread object to `ai_function` kwargs (#2769)
+- **agent-framework-core**: Enable checkpointing for `WorkflowAgent` (#2774)
+
+### Changed
+
+- **agent-framework-core**: [BREAKING] Observability updates (#2782)
+- **agent-framework-core**: Use agent description in `HandoffBuilder` auto-generated tools (#2714)
+- **agent-framework-core**: Remove warnings from workflow builder when not using factories (#2808)
+
+### Fixed
+
+- **agent-framework-core**: Fix `WorkflowAgent` to include thread conversation history (#2774)
+- **agent-framework-core**: Fix context duplication in handoff workflows when restoring from checkpoint (#2867)
+- **agent-framework-core**: Fix middleware terminate flag to exit function calling loop immediately (#2868)
+- **agent-framework-core**: Fix `WorkflowAgent` to emit `yield_output` as agent response (#2866)
+- **agent-framework-core**: Filter framework kwargs from MCP tool invocations (#2870)
+
 ## [1.0.0b251211] - 2025-12-11
 
 ### Added
@@ -366,7 +388,8 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 
 For more information, see the [announcement blog post](https://devblogs.microsoft.com/foundry/introducing-microsoft-agent-framework-the-open-source-engine-for-agentic-ai-apps/).
 
-[Unreleased]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251211...HEAD
+[Unreleased]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251216...HEAD
+[1.0.0b251216]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251211...python-1.0.0b251216
 [1.0.0b251211]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251209...python-1.0.0b251211
 [1.0.0b251209]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251204...python-1.0.0b251209
 [1.0.0b251204]: https://github.com/microsoft/agent-framework/compare/python-1.0.0b251120...python-1.0.0b251204
diff --git a/python/packages/a2a/pyproject.toml b/python/packages/a2a/pyproject.toml
index 8ac7a0abbc..56d79ce7fe 100644
--- a/python/packages/a2a/pyproject.toml
+++ b/python/packages/a2a/pyproject.toml
@@ -4,7 +4,7 @@ description = "A2A integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/ag-ui/pyproject.toml b/python/packages/ag-ui/pyproject.toml
index 805b2b55e4..8a4adceeee 100644
--- a/python/packages/ag-ui/pyproject.toml
+++ b/python/packages/ag-ui/pyproject.toml
@@ -1,6 +1,6 @@
 [project]
 name = "agent-framework-ag-ui"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 description = "AG-UI protocol integration for Agent Framework"
 readme = "README.md"
 license-files = ["LICENSE"]
diff --git a/python/packages/anthropic/pyproject.toml b/python/packages/anthropic/pyproject.toml
index 7cdc807541..55ef501a9f 100644
--- a/python/packages/anthropic/pyproject.toml
+++ b/python/packages/anthropic/pyproject.toml
@@ -4,7 +4,7 @@ description = "Anthropic integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/azure-ai-search/pyproject.toml b/python/packages/azure-ai-search/pyproject.toml
index ebb897df8c..d4227e3dd8 100644
--- a/python/packages/azure-ai-search/pyproject.toml
+++ b/python/packages/azure-ai-search/pyproject.toml
@@ -4,7 +4,7 @@ description = "Azure AI Search integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/azure-ai/pyproject.toml b/python/packages/azure-ai/pyproject.toml
index c20a28dc2e..685172e2e4 100644
--- a/python/packages/azure-ai/pyproject.toml
+++ b/python/packages/azure-ai/pyproject.toml
@@ -4,7 +4,7 @@ description = "Azure AI Foundry integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/azurefunctions/pyproject.toml b/python/packages/azurefunctions/pyproject.toml
index e6363a65f8..17320b92e4 100644
--- a/python/packages/azurefunctions/pyproject.toml
+++ b/python/packages/azurefunctions/pyproject.toml
@@ -4,7 +4,7 @@ description = "Azure Functions integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/chatkit/pyproject.toml b/python/packages/chatkit/pyproject.toml
index 6cd6a16146..8c73a2ffb0 100644
--- a/python/packages/chatkit/pyproject.toml
+++ b/python/packages/chatkit/pyproject.toml
@@ -4,7 +4,7 @@ description = "OpenAI ChatKit integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/copilotstudio/pyproject.toml b/python/packages/copilotstudio/pyproject.toml
index 955fb2cbcd..c8517c6eea 100644
--- a/python/packages/copilotstudio/pyproject.toml
+++ b/python/packages/copilotstudio/pyproject.toml
@@ -4,7 +4,7 @@ description = "Copilot Studio integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/core/pyproject.toml b/python/packages/core/pyproject.toml
index 62ef888dba..8eec13e8e6 100644
--- a/python/packages/core/pyproject.toml
+++ b/python/packages/core/pyproject.toml
@@ -4,7 +4,7 @@ description = "Microsoft Agent Framework for building AI Agents with Python. Thi
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/declarative/pyproject.toml b/python/packages/declarative/pyproject.toml
index d36c2b76b5..5a82f3a1e5 100644
--- a/python/packages/declarative/pyproject.toml
+++ b/python/packages/declarative/pyproject.toml
@@ -4,7 +4,7 @@ description = "Declarative specification support for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/devui/pyproject.toml b/python/packages/devui/pyproject.toml
index b4b43903bb..48334dca8a 100644
--- a/python/packages/devui/pyproject.toml
+++ b/python/packages/devui/pyproject.toml
@@ -4,7 +4,7 @@ description = "Debug UI for Microsoft Agent Framework with OpenAI-compatible API
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://github.com/microsoft/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/lab/pyproject.toml b/python/packages/lab/pyproject.toml
index 6b95b5a8e6..ba40548ff1 100644
--- a/python/packages/lab/pyproject.toml
+++ b/python/packages/lab/pyproject.toml
@@ -4,7 +4,7 @@ description = "Experimental modules for Microsoft Agent Framework"
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/mem0/pyproject.toml b/python/packages/mem0/pyproject.toml
index 3e80d6cdf9..4eacbc4db1 100644
--- a/python/packages/mem0/pyproject.toml
+++ b/python/packages/mem0/pyproject.toml
@@ -4,7 +4,7 @@ description = "Mem0 integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/purview/pyproject.toml b/python/packages/purview/pyproject.toml
index 5715639d19..304e5ea178 100644
--- a/python/packages/purview/pyproject.toml
+++ b/python/packages/purview/pyproject.toml
@@ -4,7 +4,7 @@ description = "Microsoft Purview (Graph dataSecurityAndGovernance) integration f
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://github.com/microsoft/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/packages/redis/pyproject.toml b/python/packages/redis/pyproject.toml
index 3cfa854300..f2f5031368 100644
--- a/python/packages/redis/pyproject.toml
+++ b/python/packages/redis/pyproject.toml
@@ -4,7 +4,7 @@ description = "Redis integration for Microsoft Agent Framework."
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
diff --git a/python/pyproject.toml b/python/pyproject.toml
index 8564c471aa..94ba24fe32 100644
--- a/python/pyproject.toml
+++ b/python/pyproject.toml
@@ -4,7 +4,7 @@ description = "Microsoft Agent Framework for building AI Agents with Python. Thi
 authors = [{ name = "Microsoft", email = "af-support@microsoft.com"}]
 readme = "README.md"
 requires-python = ">=3.10"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 license-files = ["LICENSE"]
 urls.homepage = "https://aka.ms/agent-framework"
 urls.source = "https://github.com/microsoft/agent-framework/tree/main/python"
@@ -23,7 +23,7 @@ classifiers = [
   "Typing :: Typed",
 ]
 dependencies = [
-    "agent-framework-core[all]==1.0.0b251211",
+    "agent-framework-core[all]==1.0.0b251216",
 ]
 
 [dependency-groups]
diff --git a/python/uv.lock b/python/uv.lock
index 0f3e36ede6..1ae8b00d8c 100644
--- a/python/uv.lock
+++ b/python/uv.lock
@@ -90,7 +90,7 @@ wheels = [
 
 [[package]]
 name = "agent-framework"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { virtual = "." }
 dependencies = [
     { name = "agent-framework-core", extra = ["all"], marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -157,7 +157,7 @@ docs = [
 
 [[package]]
 name = "agent-framework-a2a"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/a2a" }
 dependencies = [
     { name = "a2a-sdk", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -172,7 +172,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-ag-ui"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/ag-ui" }
 dependencies = [
     { name = "ag-ui-protocol", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -202,7 +202,7 @@ provides-extras = ["dev"]
 
 [[package]]
 name = "agent-framework-anthropic"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/anthropic" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -217,7 +217,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-azure-ai"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/azure-ai" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -236,7 +236,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-azure-ai-search"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/azure-ai-search" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -251,7 +251,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-azurefunctions"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/azurefunctions" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -276,7 +276,7 @@ dev = [{ name = "types-python-dateutil", specifier = ">=2.9.0" }]
 
 [[package]]
 name = "agent-framework-chatkit"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/chatkit" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -291,7 +291,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-copilotstudio"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/copilotstudio" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -306,7 +306,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-core"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/core" }
 dependencies = [
     { name = "azure-identity", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -370,7 +370,7 @@ provides-extras = ["all"]
 
 [[package]]
 name = "agent-framework-declarative"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/declarative" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -395,7 +395,7 @@ dev = [{ name = "types-pyyaml" }]
 
 [[package]]
 name = "agent-framework-devui"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/devui" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -429,7 +429,7 @@ provides-extras = ["dev", "all"]
 
 [[package]]
 name = "agent-framework-lab"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/lab" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -520,7 +520,7 @@ dev = [
 
 [[package]]
 name = "agent-framework-mem0"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/mem0" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -550,7 +550,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-purview"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/purview" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },
@@ -567,7 +567,7 @@ requires-dist = [
 
 [[package]]
 name = "agent-framework-redis"
-version = "1.0.0b251211"
+version = "1.0.0b251216"
 source = { editable = "packages/redis" }
 dependencies = [
     { name = "agent-framework-core", marker = "sys_platform == 'darwin' or sys_platform == 'linux' or sys_platform == 'win32'" },