Kaisa Prosperity Holdings Limited — Proxy Solicitation & Information Statement 2019

Dec 8, 2019

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Kaisa Prosperity Holdings Limited, you should at once hand this circular and the accompanying form of proxy to the purchaser, the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

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KAISA PROSPERITY HOLDINGS LIMITED 佳兆業美好集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2168)

(1) REVISION OF ANNUAL CAPS FOR CONTINUING CONNECTED TRANSACTIONS; AND

(2) NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

Capitalised terms used in this cover page shall have the same meanings as those defined in the section headed “Definitions” in this circular.

A letter of advice from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders is set out on pages 11 to 20 of this circular. The letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 10 of this circular.

A notice convening the EGM to be held at Multi-Function Room, 26/F, Sino Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong at 3 p.m. on Tuesday, 24 December 2019 is set out on pages EGM-1 to EGM-2 of this circular. A form of proxy for use at the EGM is enclosed with this circular.

Whether or not you are able to attend the EGM, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the EGM (i.e. 3 p.m. on Sunday, 22 December 2019) or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof (as the case may be) should you so desire. In such event, the instrument appointing a proxy will be deemed to be revoked.

6 December 2019

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . .	10
Letter from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . .	11
Appendix — General Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21
Notice of EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

DEFINITIONS

In this circular, unless the context otherwise requires, the following expressions shall have the meanings set out below:

• “associate(s)” has the meaning ascribed to it under the Listing Rules

• “Board” the board of Directors

• “Company” Kaisa Prosperity Holdings Limited, a company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange

• “Director(s)” director(s) of the Company

• “EGM”

• the extraordinary general meeting of the Company to be convened and to consider and, if thought fit, approve, the revised annual caps

• “GFA” gross floor area

• “Group” the Company and its subsidiaries

• “Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

• “Independent Board Committee”

• a committee of the Board comprising all the independent non-executive Directors

• “Independent Financial Adviser”

• Messis Capital Limited, a licensed corporation to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities under the SFO

• “Independent Shareholders”

• the Shareholders, other than Kaisa Holdings, Mr. Kwok and their respective associates (as defined in the Listing Rules)

• “Kaisa Group”

• Kaisa Holdings and its subsidiaries excluding the Group

• “Kaisa Holdings”

• Kaisa Group Holdings Ltd. (佳兆業集團控股有限公司) (stock code: 1638), an exempted company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange

• “Latest Practicable Date”

• 6 December 2019, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information for inclusion in this circular

– 1 –

DEFINITIONS

• “Listing Date”

6 December 2018

• “Listing Rules”

the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

• “Mr. Kwok” Mr. Kwok Ying Shing, the Chairman of the board of directors of Kaisa Holdings and an executive director of Kaisa Holdings

• “PRC” the People’s Republic of China, which for the purpose of this circular shall exclude Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan

• “Property Management Services the property management services framework Framework Agreement” agreement entered into between Kaisa Holdings and the Company dated 20 November 2018

• “Property Management has the meaning ascribed to it under the section Services” headed “THE PROPERTY MANAGEMENT SERVICES FRAMEWORK AGREEMENT” of this circular

• “Proposed Revised Annual the proposed revision of annual caps to the Property Caps” Management Services Framework Agreement

• “Prospectus” the prospectus of the Company dated 26 November 2018

• “RMB” Renminbi, the lawful currency of the PRC

• “SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) as amended, supplemented or otherwise modified from time to time

• “Shareholder(s)” holder(s) of share(s) of the Company

• “Share(s)” ordinary shares in the capital of the Company with nominal value of HK$0.01 each

• “Stock Exchange” The Stock Exchange of Hong Kong Limited

• “Supplemental Agreement” the supplemental agreement dated 29 November 2019 entered into between Kaisa Holdings and the Company to amend the annual caps of the Property Management Services Framework Agreement for the year ending 31 December 2019 and 2020

“%”

per cent.

– 2 –

LETTER FROM THE BOARD

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KAISA PROSPERITY HOLDINGS LIMITED 佳兆業美好集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2168)

Executive Directors:

Mr. LIAO Chuanqiang (Chairman) Ms. GUO Li Mr. WENG Hao Mr. WU Jianxin

Independent Non-executive Directors: Mr. LIU Hongbai Ms. MA Xiumin Mr. CHEN Bin

Registered Office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman, KY1-1111 Cayman Islands

Principal Place of Business in Hong Kong: Room 1901 19/F, Lee Garden One 33 Hysan Avenue Causeway Bay Hong Kong

6 December 2019

To the Shareholders

Dear Sir or Madam,

REVISION OF ANNUAL CAPS FOR CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

Reference is made to the announcement of the Company dated 29 November 2019 in relation to, among others, the Proposed Revised Annual Caps.

The purpose of this circular is to provide you with further details about (i) the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement); (ii) the recommendation of the Independent Board Committee; (iii) the advice of the Independent Financial Adviser; and (iv) a notice convening the EGM.

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LETTER FROM THE BOARD

THE PROPERTY MANAGEMENT SERVICES FRAMEWORK AGREEMENT

The principal terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are set out below:

Date : 20 November 2018

Parties

• : Kaisa Holdings and the Company

Term

• : The period commencing from the Listing Date until 31 December 2020

Subject matter

• : The Group shall provide the following services to Kaisa Group and/or its associates, including but not limited to:

• (i) pre-delivery services including (a) construction sites management services; and (b) display units and property sales venues management services; and

• (ii) property management services for properties owned, used or operated by Kaisa Group and/or its associates

(the “ Property Management Services ”).

Pricing basis

• : The fees to be charged for the Property Management Services shall be determined after arm’s length negotiations and taking into account (i) the size, location and positioning of the properties to be sold by the sales centers; and (ii) the anticipated operational costs (including labour costs, material costs and administrative costs) with reference to the fees for similar services and similar type of projects in the market.

The service fees shall not be higher than the standard fees designated by the relevant regulatory authorities (if applicable) or lower than the standard fees to be charged from independent third parties for similar Property Management Services.

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LETTER FROM THE BOARD

Proposed annual caps (as amended by the Supplemental Agreement)

: Under the Supplemental Agreement, the annual caps are proposed to be revised as follows:

			For the	For the
			year	year
			ending 31	ending 31
			December	December
			2019	2020
			(RMB’000)	(RMB’000)
Original	annual	cap	440,000	485,000
Revised	annual	cap	500,000	550,000

• Reasons for the revision of : Set out in the table below are the actual transaction the annual caps amounts for the year ended 31 December 2018 and the ten months ended 31 October 2019.

	For the	For the ten
	year	months
	ended 31	ended 31
	December	October
	2018	2019
	(RMB’000)	(RMB’000)
Original annual cap	405,000	440,000
Actual transaction
amount	402,758	393,000

As shown in the table, the actual transaction amount for the ten months ended 31 October 2019 has reached more than 89% of the original annual cap for the year ending 31 December 2019.

The Proposed Revised Annual Caps are determined with reference to the following factors:

• a) the historical transaction amounts under the Property Management Services Framework Agreement for the ten months ended 31 October 2019, representing an increase of approximately 18.9% from RMB330,654,000 for the corresponding period in 2018;

• b) the estimated capacity of the Group to provide Property Management Services; and

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LETTER FROM THE BOARD

• c) the anticipated increase in demand for Property Management Services from Kaisa Group for the two months ending 31 December 2019 and the financial year ending 31 December 2020 due to the expected increase in the total contracted GFA of Kaisa Group as evidenced by an increase of approximately 19.5% in the total contracted GFA for the ten months ended 31 October 2019 as compared to the same for the corresponding period in 2018 as published by Kaisa Holdings.

For the eleven months ended 30 November 2019, the Company recorded actual transaction amount of approximately RMB424,000,000, representing approximately 96.4% of the original annual cap for the year ending 31 December 2019. As at the Latest Practicable Date, the annual cap for the year ending 31 December 2019 under the Property Management Services Framework Agreement has not been exceeded and no further transactions are to be conducted until the revised annual caps have been approved at the EGM. In addition, the Company has in place internal control measures to ensure that the 2019 annual cap will not be exceeded. Such measures include (1) appointing one dedicated employee with financial background holding the position of the general manager of the financial planning department in the Group and who shall report directly to the Directors to monitor the transaction amount on a daily basis until the date of the EGM; and (2) circulating a reminder to all personnel reminding them that the 2019 transaction amount has reached an amount close to the 2019 annual cap and that such annual cap must not be exceeded before the Company is in compliance with the requirements under Rule 14A.54 of the Listing Rules.

INTERNAL CONTROL

The Company has established various internal control measures to monitor the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), including:

• (i) prior to supplying the Property Management Services, the operating department shall obtain the prevailing market price of the relevant Property Management Services. In addition, the operating department checks the recent sales of the Property Management Services by the Group to independent third parties to ensure that the price offered to Kaisa Group shall not be lower than that offered to independent third parties;

• (ii) the Company has a designated employee, who is familiar with the finance and business operations of the Group, to monitor the aggregate amount of the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and assesses on a monthly basis whether the annual cap thereunder may be exceeded;

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LETTER FROM THE BOARD

• (iii) the independent non-executive Directors conduct annual reviews with respect to the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and confirm in the annual report, pursuant to the requirements under the Listing Rules, whether such continuing connected transactions have been entered into in the ordinary and usual course of business of the Group, are on normal commercial terms, and in accordance with the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) on terms that are fair and reasonable and in the interests of the Company and its Shareholders as a whole; and

• (iv) the Company’s external auditors conduct annual reviews of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder in accordance to the Listing Rules.

LISTING RULES IMPLICATIONS

The Group is principally engaged in the provision of property management services, pre-delivery and consulting services, community value-added services and smart solution services in the PRC.

Kaisa Holdings is an exempted company incorporated in the Cayman Islands with limited liability, the shares of which are listed on the Main Board of the Stock Exchange (Stock Code: 1638). Kaisa Group is principally engaged in property development, property investment, property management, hotel and catering operations, cinema, department store and cultural centre operations, water-way passenger and cargo transportation and healthcare business in the PRC.

As at the Latest Practicable Date, Kaisa Holdings is interested in 103,530,000 Shares, representing approximately 73.95% of the Shares in issue. Kaisa Holdings is a controlling Shareholder and hence a connected person (as defined in the Listing Rules) of the Company. The transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

As one or more applicable percentage ratios (other than the profits ratio) in respect of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are over 5%, the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) is subject to the reporting, announcement, annual review and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

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LETTER FROM THE BOARD

The Directors (excluding Mr. Weng Hao and Mr. Wu Jianxin and including the independent non-executive Directors after taking the advice from the Independent Financial Adviser) consider that the Supplemental Agreement (including the Proposed Revised Annual Caps) was entered into in the ordinary and usual course of business of the Group, are conducted on an arm’s length basis and on normal commercial terms, and are fair and reasonable and in the interests of the Company and its Shareholders as a whole.

Mr. Weng Hao is a director of Kaisa Holdings and Mr. Wu Jianxin is a vice president of Kaisa Group. Each of them has abstained from voting in the relevant resolutions of the board meeting of the Company.

The Independent Board Committee has been formed to consider whether the terms of the Property Management Services Framework Agreement and the annual caps (as amended by the Supplemental Agreement) and the transactions contemplated thereunder are on normal commercial terms, are conducted in the ordinary and usual course of business of the Group, are fair and reasonable, and are in the interests of the Company and the Shareholders as a whole, and to advise the Independent Shareholders as to voting at the EGM.

Any Shareholder with a material interest and his/her/its associate(s) is (are) required to abstain from voting at the EGM to approve the Property Management Services Framework Agreement (as amended by the Supplemental Agreement).

As at the Latest Practicable Date, (i) Kaisa Holdings is interested in 103,530,000 Shares, representing approximately 73.95% of the Shares in issue; and (ii) Mr. Kwok is interested in 1,141,750 Shares, representing approximately 0.82% of the Shares in issue, shall abstain from voting on the resolutions approving the Property Management Services Framework Agreement (as amended by the Supplemental Agreement).

Except as disclosed above, to the best of their knowledge and belief, no other Shareholder is required to abstain from voting at the EGM.

EGM AND VOTING

The notice of the EGM is set out on pages EGM-1 to EGM-2 of this circular.

Pursuant to the Listing Rules, any vote of the Shareholders at a general meeting must be taken by poll. An announcement on the poll vote results will be published by the Company after the EGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

A form of proxy for use at the EGM are enclosed with this circular and also published on the website of the Stock Exchange (www.hkexnews.hk). Whether or not you are able to attend the EGM, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon to the branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the

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LETTER FROM THE BOARD

holding of the EGM (i.e. 3 p.m. on Sunday, 22 December 2019) or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof (as the case may be) should you so desire. In such event, the instrument appointing a proxy will be deemed to be revoked.

RECOMMENDATION

The Directors (including the independent non-executive Directors but excluding Mr. Weng Hao and Mr. Wu Jianxin) consider that the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder are on normal commercial terms, are conducted in the ordinary and usual course of business of the Group, are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favour of the relevant resolution at the EGM.

ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendix to this circular.

By order of the Board Kaisa Prosperity Holdings Limited LIAO Chuanqiang Chairman

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LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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KAISA PROSPERITY HOLDINGS LIMITED 佳兆業美好集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2168)

6 December 2019

To the Independent Shareholders

Dear Sir or Madam,

REVISION OF ANNUAL CAPS FOR CONTINUING CONNECTED TRANSACTIONS

We refer to the circular of the Company to the Shareholders dated 6 December 2019 (the ‘‘ Circular ’’), in which this letter forms a part. Unless the context requires otherwise, capitalized terms used in this letter will have the same meanings given to them in the Circular.

We have been authorised by the Board to form the Independent Board Committee to advise the Independent Shareholders on whether the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are fair and reasonable so far as the Independent Shareholders are concerned.

We wish to draw your attention to the letter of advice from Messis Capital Limited, the Independent Financial Adviser appointed to advise the Independent Board Committee and the Independent Shareholders on the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) as set out on pages 11 to 20 of the Circular and the letter from the Board as set out on pages 3 to 9 of the Circular.

Having considered, among other matters, the factors and reasons considered by, and the opinion of the Independent Financial Adviser as stated in its letter of advice, we consider that the terms of the Property Management Services Framework Agreement including the annual caps (as amended by the Supplemental Agreement) and the transactions contemplated thereunder are on normal commercial terms, are conducted in the ordinary and usual course of business of the Group, are fair and reasonable and in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions proposed at the EGM to approve the Property Management Services Framework Agreement (as amended by the Supplemental Agreement).

Yours faithfully, For and on behalf of the Independent Board Committee

Mr. LIU Hongbai Ms. MA Xiumin Mr. CHEN Bin Independent non-executive Independent non-executive Independent non-executive Director Director Director

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the letter of advice from the Independent Financial Adviser, Messis Capital Limited, to the Independent Board Committee and the Independent Shareholders in relation to the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), which has been prepared for the purpose of inclusion in this circular.

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6 December 2019

• To: the Independent Board Committee and the Independent Shareholders of Kaisa Prosperity Holdings Limited

Dear Sirs,

CONTINUING CONNECTED TRANSACTIONS IN RELATION TO PROPERTY MANAGEMENT SERVICES FRAMEWORK AGREEMENT (AS AMENDED BY THE SUPPLEMENTAL AGREEMENT)

INTRODUCTION

We refer to our appointment as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder including the proposed annual caps. Details of the Property Management Services Framework Agreement are set out in (i) the letter from the Board (the “ Letter from the Board ”) contained in the circular of the Company to the Shareholders dated 6 December 2019 (the “ Circular ”), of which this letter forms part; and (ii) the paragraph headed “Connected transactions – Continuing connected transactions subject to the reporting, annual review, announcement and independent shareholders’ approval requirements – Property Management Services Framework Agreement” in the Company’s prospectus dated 26 November 2018 (the “ Prospectus ”). Capitalised terms used in this letter shall have the same meanings as defined in the Circular unless the context otherwise requires.

On 20 November 2018, the Company entered into the Property Management Services Framework Agreement with Kaisa Holdings, pursuant to which the Company agreed to provide to Kaisa Group and/or its associates property management services, including but not limited to (i) pre-delivery services including (a) construction sites management services; and (b) display units and property sales venues management services; and (ii) property management services for properties owned, used or operated by Kaisa Group and/or its associates (the “ Property Management Services ”) for a term commencing from the Listing Date until 31 December 2020. A waiver exempting the Company from strict compliance with the announcement and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the continuing

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

connected transactions was granted by the Stock Exchange on the condition that the aggregate amounts of the continuing connected transactions contemplated under the Property Management Services Framework Agreement for each financial year (i.e. FY2018, FY2019 and FY2020) shall not exceed the relevant amounts set forth in the respective annual caps which are RMB405 million, RMB440 million and RMB485 million, respectively. Details of the then waiver are set out in the Prospectus. Owe to the increase in sales of properties by Kaisa Holdings and other relevant factors that drive the growth of the Company’s revenue generated from the Property Management Services Framework Agreement, the Company considered that the original annual caps are insufficient and therefore entered into the Supplemental Agreement on 29 November 2019 to increase the annual caps to RMB500 million and RMB550 million for the year ending 31 December 2019 and 2020 respectively.

As at the Latest Practicable Date, Kaisa Holdings is a controlling shareholder of the Company and therefore a connected person of the Company under the Listing Rules. Accordingly, the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder constitute continuing connected transactions of the Company under the Listing Rules. As one or more applicable percentage ratios (other than the profits ratio) in respect of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are over 5%, the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are subject to the reporting, announcement, annual review and Independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

The Independent Board Committee, comprising all three independent non-executive Directors, namely Mr. Liu Hongbai, Ms. Ma Xiumin and Mr. Chen Bin, has been established to consider and make a recommendation to the Independent Shareholders on whether (i) the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) is in the ordinary and usual course of business of the Company; (ii) the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned; (iii) the entering into of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) is in the interests of the Company and the Shareholders as a whole; and (iv) the proposed annual caps are fair and reasonable so far as the Independent Shareholders are concerned. We, Messis Capital Limited, have been appointed to advise the Independent Board Committee and the Independent Shareholders in this regard.

Mr. Weng Hao is a director of Kaisa Holdings and Mr. Wu Jianxin is a vice president of Kaisa Group. Since Kaisa Holdings is a controlling shareholder of the Company who has material interest in the transaction, each of Mr. Weng Hao and Mr. Wu Jianxin shall abstained from voting in the relevant resolutions of the board meeting of the Company. Mr. Kwok is interested in 1,141,750 Shares, representing approximately 0.82% of the issued Shares of the Company, shall also abstain from voting in the resolutions approving the Property Management Services Framework Agreement (as amended by the Supplemental Agreement).

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Messis Capital Limited is not connected with the Directors or substantial shareholders of the Company or any of their respective associates and therefore is considered suitable to give independent advice to the Independent Board Committee and the Independent Shareholders. In the past two years, there was no engagement between the Company and us. Apart from normal professional fees payable to us in connection with this appointment of us as independent financial adviser, no arrangement exists whereby Messis Capital Limited will receive any fees or benefits from the Company or the Directors or substantial shareholders of the Company or any of their respective associates.

BASIS OF OUR OPINION

In arriving at our recommendations, we have relied on the statements, information and representations contained in the Circular and the information and representations provided to us by the Company, the Directors and the management of the Company. We have assumed that all information, representations and opinions contained or referred to in the Circular and all information and representations which have been provided by the Company, the Directors and the management of the Company for which they are solely and wholly responsible, are true and accurate at the time they were made and will continue to be accurate as at the Latest Practicable Date. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the management of the Company.

The Circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in the Circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement therein or the document misleading.

We consider that we have been provided with sufficient information on which to form a reasonable basis for our opinion. We have no reason to suspect that any relevant information has been withheld, nor are we aware of any material facts or circumstances which would render the information provided and representations made to us untrue, inaccurate or misleading. We consider that we have performed all the necessary steps to enable us to reach an informed view and to justify our reliance on the information provided so as to provide a reasonable basis for our opinion. We have not, however, carried out any independent verification of the information provided by the Company, the Directors and the management of the Company, nor have we conducted an independent investigation into the business and affairs of the Group and any parties in relation to the Property Management Services Framework Agreement (as amended by the Supplemental Agreement).

This letter is issued for the information of the Independent Board Committee and the Independent Shareholders solely in connection with their consideration of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder together with the proposed annual caps. Except for its inclusion in the Circular, this letter is not to be quoted or referred to, in whole or in part, nor shall this letter be used for any other purposes, without our prior written consent.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion and recommendations to the Independent Board Committee and the Independent Shareholders, we have considered the following principal factors and reasons:

1. Background to and reasons for the Property Management Services Framework Agreement (as amended by the Supplemental Agreement)

The Group is principally engaged in the provision of property management services, pre-delivery and consulting services, community value-added services and smart solution services in the PRC. Prior to the spin-off and separate listing of the Company, the Company was part of the Kaisa Group to provide property management services to properties developed by the Kaisa Group and other independent third party property developers. On 6 December 2018, the Company was separately listed on the Main Board and all property management services including (i) pre-delivery services; and (ii) property management services, provided by the Company to the Kaisa Group are regarded as continuing connected transactions governed by the Property Management Services Framework Agreement.

The table below sets forth the revenue generated from provision of Property Management Services to Kaisa Group under the Property Management Services Framework Agreement for the three years ended 31 December 2018 as extracted from the Company’s annual report for the year ended 31 December 2018 (the “ Annual Report ”) and the Prospectus:

	**Year **	ended 31 December
	2016	2017	2018
	RMB’000	RMB’000	RMB’000
	(Audited)	(Audited)	(Audited)
Revenue from Kaisa Group [A]	271,912	324,121	402,758
Total revenue [B]	539,107	669,159	895,768
[A]/[B]	50.4%	48.4%	45.0%

The table above shows that revenue generated from provision of Property Management Services to Kaisa Group represented a material source of revenue to the Group in the past three years. The executive Directors confirm that such close business relationship with the Kaisa Group is attributable to the fact that substantially all of the properties developed and owned by the Kaisa Group are under the Group’s management. Accordingly, the executive Directors consider, and we concur, that the provision of Property Management Services to Kaisa Group is in the ordinary and usual course of business of the Company and the Property Management Services Framework Agreement allows the Group to continue its long standing business relationship with Kaisa Group while safeguarding the interest of both parties in any future engagement, which is beneficial to the development of the Group.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

2. Principal terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement)

The principal terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), among others, are set out below:

Date:

20 November 2018 (being the original date of the Property Management Services Framework Agreement)

29 November 2019 (being the date of the Supplemental Agreement)

Parties:

• (1) the Company

• (2) Kaisa Holdings, a controlling shareholder of the Company

Term:

The period commencing from the Listing Date until 31 December 2020

Scope of services:

The Group shall provide the following services to Kaisa Group and/or its associates, including but not limited to:

• (i) pre-delivery services including (a) construction sites management services; and (b) display units and property sales venues management services; and

• (ii) property management services for properties owned, used or operated by the Kaisa Group and/or its associates.

Annual cap:

The maximum annual fee payable by the Kaisa Group and/or its associates in relation to the Property Management Services to be provided by the Group under the Property Management Services Framework Agreement for each of the two years ending 31 December 2019 and 2020 will not exceed RMB500 million and RMB550 million, respectively.

Service fee:

The fees to be charged for the Property Management Services shall be determined after arm’s length negotiations and taking into account (i) the size, location and positioning of the properties to be sold by the sales centers; and (ii) the anticipated operational costs (including labor costs, material costs and administrative costs) with reference to the fees for similar services and similar type of projects in the market. The service fees shall not be higher than the standard fees designated by the relevant regulatory authorities (if applicable) or lower than the standard fees charged to independent third parties for similar Property Management Services.

– 15 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In assessing the fairness and reasonableness of the service fee under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), we have obtained and reviewed a comparison table from the management of the Group presenting the historical gross profit margin of Property Management Services provided to Kaisa Group and relevant services provided to independent third party customers. According to the management of the Group, gross profits amounting to approximately RMB39.0 million and RMB20.0 million, representing approximately 34.8% and 24.8% of the gross profits generated from independent third party customers for the year ended 31 December 2018 and six months ended 30 June 2019 respectively, were attributable to commission based property management services solely provided to independent third party customers in the respective year/period. Such commission based property management services carrying 100% gross profit margins have inflated the overall gross profit margins generated from independent third party customers in the respective year/period. After excluding the commission based property management services which are not provided to Kaisa Group, the Group generated gross profit margins of approximately 29.5% and 34.4% from Kaisa Group and 25.1% and 28.2% from independent third party customers for the year ended 31 December 2018 and six months ended 30 June 2019 respectively. Given that each individual project is different in terms of scope of services, properties under management and operational costs incurred, the executive Directors consider, and we concur, that the gross profit margins generated from projects with Kaisa Group is generally in line with that generated from projects with independent third party customers.

We have also reviewed and compared sample documents provided by the Company (including, among other things, invoices, contracts and other related documents) with respect to similar property management projects with Kaisa Group and other independent third party customers. Shortlisted projects that are considered comparable in terms of (i) location of properties under management; (ii) contract size; and/or (iii) scope of services, are selected from project list prepared by management covering the period from 20 November 2018 to 30 June 2019 (the “ Review Period ”). We consider it fair and reasonable to select comparable projects from the Review Period because it covers the latest published financial period and is a relevant period governed by the Property Management Services Framework Agreement. We therefore reviewed comparable projects that aggregately contributed approximately 60% of revenue generated from Kaisa Group under the Property Management Services Framework Agreement during the Review Period. Based on the review of these comparable projects, we note that there is no significant difference in pricing and terms given by the Company to Kaisa Group and other independent third party customers.

Having considered that the principal terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), in particular that the service fee charged to Kaisa Group is generally in line with that charged to independent third party customers as evidenced by the fact that (i) gross profit margins generated from projects with Kaisa Group were better than that generated from projects with independent third party customers in FY2018 and six months ended 30 June 2019; and (ii) sample comparable projects reveal no significant difference in pricing and terms given by the Company to Kaisa Group and other independent third party customers, we concur with the executive Directors’ view that the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned.

– 16 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3. The proposed annual caps

The historical figures in respect of (i) revenue generated from provision of Property Management Services to Kaisa Group; (ii) Kaisa Group’s contracted sales; and (iii) Kaisa Group’s contracted sales GFA for the three years ended 31 December 2018 as extracted from (a) Kaisa Group’s annual reports for the year ended 31 December 2017 and 2018 (the “ Kaisa Group Annual Reports ”); (b) the Annual Report; and (c) the Prospectus are as follows:

	**Year **	ended 31 December
	2016	2017	2018
Revenue from Kaisa Group
(RMB’000)	271,912	324,121	402,758
Kaisa Group’s contracted sales
(RMB in million)	29,800	44,714	70,059
Kaisa Group’s contracted sales
GFA_(sq.m)_	2,269,379	2,786,289	3,836,621

We are given to understand that revenue generated from provision of Property Management Services to Kaisa Group is closely related to the amount of Kaisa Group’s contracted sales of properties where an increase in contracted sales is associated with more sales activities organized by the Kaisa Group at sales centers that require Property Management Services provided by the Group. As shown in the table above, revenue generated from provision of Property Management Services to Kaisa Group increased significantly in the past three years by approximately RMB130.9 million or 48.1% from approximately RMB271.9 million for the year ended 31 December 2016 to approximately RMB402.8 million for the year ended 31 December 2018. Such increase in revenue from the provision of Property Management Services follows a more significant increase in Kaisa Group’s contracted sales of properties in the past three years by approximately RMB40,259 million or 135.1% from approximately RMB29,800 million for the year ended 31 December 2016 to approximately RMB70,059 million for the year ended 31 December 2018.

With reference to the Prospectus, a waiver exempting the Company from strict compliance with the announcement and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the continuing connected transactions was granted by the Stock Exchange on the condition that the aggregate amounts of the continuing connected transactions contemplated under the Property Management Services Framework Agreement for each financial year (i.e. FY2018, FY2019 and FY2020) shall not exceed the relevant amounts set forth in the respective annual caps which are RMB405 million, RMB440 million and RMB485 million, respectively (the “ Original Annual Caps ”). The executive Directors confirm that the Original Annual Caps were determined with reference to the estimated contract sales and contracted sales GFA of Kaisa Group. It was conservatively estimated that Kaisa Group’s contracted sales of properties in FY2018 shall increase slightly by approximately 5.8% from approximately RMB44,714 million in FY2017 to approximately RMB47,306 million in

– 17 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

FY2018 based on the then latest audited financial information of Kaisa Group for the six months ended 30 June 2018. However, Kaisa Group’s contracted sales in FY2018 turned out to increase dramatically to approximately RMB70,059 million, representing 48.1% in excess of the original estimation of approximately RMB47,306 million. With reference to the Kaisa Group Annual Reports, the increase in Kaisa Group’s contracted sales to a record high in FY2018 was mainly attributable to the strong contracted sales in the Guangdong-Hong Kong-Macao Greater Bay Area driven by the economic boom in the area and the Kaisa Group’s strong brand influence that had resulted from many years of its thorough property development in that area. The executive Directors consider that the Property Management Services associated with the sales activities of Kaisa Group would increase accordingly and the Original Annual Caps are insufficient to satisfy the Group’s business growth. Set out below is the actual transaction amounts for the ten months ended 31 October 2019 as extracted from the Letter from the Board:

	Ten months
	ended
	31 October
	2019
	RMB’000
Original Annual Caps [A]	440,000
Actual transaction amount [B]	393,000
[B]/[A]	89.3%

The actual transaction amount for the ten months ended 31 October 2019 has reached more than 89% of the original annual cap for the year ending 31 December 2019. Given the approaching limit of the original annual cap in FY2019, the executive Directors are of the view that revenue of the Group in FY2019 will be hindered if the annual cap is not increased. Therefore, the Supplemental Agreement was entered into on 29 November 2019 to revise the annual caps upward to RMB500 million and RMB550 million for the year ending 31 December 2019 and 2020 respectively.

According to Kaisa Group’s announcement dated 11 November 2019 (the “ Kaisa Group Announcement ”) in relation to the unaudited operating figures for the ten months ended 31 October 2019, the total contracted sales of the Kaisa Group for the ten months ended 31 October 2019 amounted to approximately RMB63,104 million with the total contracted GFA of approximately 3,473,840 sq.m., representing increases of approximately 28.5% and 19.5% as compared with corresponding period in 2018, respectively. The executive Directors estimate that Kaisa Group’s annual contracted sales could reach approximately RMB76,000 million in FY2019 and approximately RMB85,000 million in FY2020, based on a conservative annual average growth rate of approximately 10% per annum which is lower than the growth rate of over 50% achieved in the past three years. Accordingly, the executive Directors are of the view, and we concur, that the annual caps of RMB500 million for FY2019 and RMB550 million for FY2020 are reasonably determined with reference the estimated contracted sales of Kaisa Group.

– 18 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

After taking into consideration (i) the significant increase in historical revenue generated from provision of Property Management Services to Kaisa Group by approximately 48.1% in the past three years; (ii) the expected increase in Property Management Services to be provided by the Group owe to the strong increase in sales activities of Kaisa Group as evidenced by the record high contracted sales and contracted GFA achieved by the Kaisa Group in FY2018; (iii) the approaching limit of the original annual cap in FY2019; and (iv) the estimated Kaisa Group’s contracted sales of properties in FY2019 and FY2020, we concur with the executive Directors’ view that the proposed annual caps are fair and reasonable so far as the Independent Shareholders are concerned.

4. Internal control measures regarding the transactions contemplated under the Property Management Services Framework Agreement

For the eleven months ended 30 November 2019, the Company recorded actual transaction amount of approximately RMB424 million, representing approximately 96.4% of the original annual cap for the year ending 31 December 2019. We are given to understand that the Company has implemented measures to ensure that the 2019 annual cap is not exceeded, which include (i) appointing one dedicated employee with financial background holding the position of the general manager of the financial planning department in the Group and who shall report directly to the management to monitor the transaction amount on a daily basis until the date of the EGM; and (ii) circulating a reminder to all personnel reminding them that the 2019 transaction amount has reached an amount close to the 2019 annual cap and that such annual cap must not be exceeded before the Company is in compliance with the requirements under Rule 14A.54 of the Listing Rules. The Company further assures that no further transactions are conducted until the revised annual caps have been approved at the EGM.

In addition to the abovementioned specific control measures to tackle the approaching limit of the 2019 annual cap, the Company has also established various internal control measures to monitor the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), including:

• (i) Prior to supplying the Property Management Services, the operating department shall obtain the prevailing market price of the relevant Property Management Services. In addition, the operating department checks the recent sales of the Property Management Services by the Group to independent third parties to ensure that the price offered to Kaisa Group shall not be lower than that offered to independent third parties;

• (ii) the Company has a designated employee, who is familiar with the finance and business operations of the Group, to monitor the aggregate amount of the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and assess on a monthly basis whether the annual cap thereunder may be exceeded;

• (iii) the independent non-executive Directors conduct annual reviews with respect to the transactions contemplated under the Property Management Services

– 19 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Framework Agreement (as amended by the Supplemental Agreement) and confirm in the annual report, pursuant to the requirements under the Listing Rules, whether such continuing connected transactions have been entered into in the ordinary and usual course of business of the Group, on normal commercial terms, and in accordance with the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) on terms that are fair and reasonable and in the interests of the Company and its Shareholders as a whole; and

• (iv) the Company’s external auditors will conduct annual review of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder in accordance to the Listing Rules.

We consider that the abovementioned measures are in the interests of the Independent Shareholders as their interests are safeguarded by (a) setting up of the pricing management procedures; (b) ensuring terms of continuing connected transactions are determined with reference to the prevailing market information and terms of similar transactions to be entered into with independent third parties; and (c) setting up of the review and approval process.

OPINION AND RECOMMENDATION

Having taken into consideration the factors and reasons as stated above, we are of the view that (i) the transactions contemplated under the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) is in the ordinary and usual course of business of the Company; (ii) the terms of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) are on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned; (iii) the entering into of the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) is in the interests of the Company and the Shareholders as a whole; and (iv) the proposed annual caps are fair and reasonable so far as the Independent Shareholders are concerned. Accordingly, we recommend the Independent Shareholders, as well as the Independent Board Committee to recommend the Independent Shareholders, to vote in favour of the relevant resolutions to be proposed at the EGM to approve the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the proposed annual caps thereof.

Yours faithfully, For and on behalf of Messis Capital Limited Wallace Cheung Director

Mr. Wallace Cheung is a licensed person registered with the Securities and Futures Commission and regarded as a responsible officer of Messis Capital Limited to carry out type 6 (advising on corporate finance) regulated activities under the SFO and has over 9 years of experience in corporate finance industry.

– 20 –

APPENDIX

GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This circular for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DISCLOSURE OF INTERESTS

(I) Directors’ and chief executive’s interests in Shares, underlying Shares or debentures

As at the Latest Practicable Date, the interests of the Directors and the chief executive in the Shares, underlying Shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) (the “ Associated Corporations ”) as recorded in the register required to be kept by the Company under section 352 of the SFO or as otherwise notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to have under provisions of the SFO) or the Model Code for Securities Transactions by Directors of Listed Issuers (the “ Model Code ”) were as follows:

Long positions in the underlying shares:

		Name of	Number of	Approximate
		associated	shares	percentage of
**Name **	of Director	corporation	interested	interest
				(Note 1)
LIAO	Chuanqiang	Kaisa Group	4,000,000	0.07%
		Holdings Ltd.

Note:

1. The percentages are calculated based on 6,085,396,697 shares of Kaisa Group in issue as at the Latest Practicable Date.

(II) Substantial interests in the share capital of the Company

As at the Latest Practicable Date, so far as was known to the Directors and chief executive of the Company, the following persons (other than a Director or chief executive of the Company) had an interest or short position in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Division 2 and 3 of Part XV of the SFO, or who were, directly or indirectly, interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or had any options in respect of such capital:

– 21 –

APPENDIX

GENERAL INFORMATION

Long positions in the shares and/or underlying shares of the Company:

			Approximate
			percentage of
			the issued
Name of			share capital
substantial		Number of	of the
shareholder	Capacity	shares	Company
		(Note 1)	(%)
Kaisa Group	Interest in	103,530,000 (L)	73.95
Holdings Ltd.	controlled	(Note 2)
	corporation
Rui Jing Investment	Interest in	103,530,000 (L)	73.95
Company Limited	controlled	(Note 2)
(“Rui Jing”)	corporation
Ye Chang	Beneficial owner	103,530,000 (L)	73.95
Investment		(Note 2)
Company Limited
(“Ye Chang”)

Notes:

1. The letter “L” denotes the person’s long position in the Shares and the letter “S” denotes the person’s short position in the Shares.

2. Ye Chang is beneficially wholly-owned by Rui Jing, which in turn is beneficially wholly-owned by Kaisa Group. By virtue of the SFO, each of Kaisa Group and Rui Jing is deemed to be interested in the same number of Shares which Ye Chang is interested in.

Save as disclosed above, as at the Latest Practicable Date, so far as was known to the Directors and the chief executive of the Company, no other person had interests or short positions in the Shares or underlying Shares of any of its Associated Corporations which were required to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who were, directly or indirectly, beneficially interested in 10% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any other member of the Group or in any options in respect of such capital.

3. DIRECTORS’ INTERESTS IN ASSETS, CONTRACT OR ARRANGEMENT

None of the Directors had any direct or indirect interest in any assets which had been acquired or disposed of by or leased to any member of the Group or proposed to be so acquired, disposed of by or leased to any member of the Group since 31 December 2018, being the date to which the latest published audited accounts of the Company were made up, and up to the Latest Practicable Date.

– 22 –

APPENDIX

GENERAL INFORMATION

None of the Directors was materially interested in any contract or arrangement entered into by the Company or any of its subsidiaries which contract or arrangement is subsisting at the Latest Practicable Date and which is significant in relation to the business of the Group.

4. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which does not expire or is not determinable by such member of the Group within one year without payment of compensation other than statutory compensation.

5. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2018 (being the date to which the latest published audited consolidated financial statements of the Group were made up).

6. COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors or any of their respective close associates (as defined in the Listing Rules) was interested in any business apart from the business of the Group, which competes or is likely to compete, either directly or indirectly, with that of the Group.

7. EXPERT’S QUALIFICATION AND CONSENT

Set out below is the qualification of the expert who has given its letter of advice in this circular:

Qualification

Name Qualification Messis Capital Limited a corporation licensed under the SFO to engage in type 1 (dealing in securities) and type 6 (advising on corporate finance) regulated activities

The Independent Financial Adviser has given and has not withdrawn its written consent to the issue of this circular with the inclusion herein of its letter or reference to its name in the form and context in which it appears.

As at the Latest Practicable Date, the Independent Financial Adviser did not have any shareholding in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

– 23 –

APPENDIX

GENERAL INFORMATION

As at the Latest Practicable Date, the Independent Financial Adviser did not have any direct or indirect interests in any assets which had been, since 31 December 2018 (being the date to which the latest published audited consolidated financial statements of the Group were made up), acquired or disposed of by or leased to or were proposed to be acquired or disposed of by or leased to any member of the Group.

8. LITIGATION

So far as the Company is aware, as at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration of material importance and there is no litigation or claim of material importance known to the Directors pending or threatened by or against any member of the Group.

9. MISCELLANEOUS

In the event of inconsistency, the English text of this circular and the accompanying form of proxy shall prevail over the Chinese text.

10. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection during normal business hours at 30/F, The Center, 99 Queen’s Road Central, Central, Hong Kong from the date of this circular up to and including the date of the EGM:

• (i) the Property Management Services Framework Agreement;

• (ii) the Supplemental Agreement;

• (iii) the letter of recommendation from the Independent Board Committee to the Independent Shareholders;

• (iv) the letter from the Independent Financial Adviser;

• (v) the written consent as referred to under the section headed “Expert’s qualification and consent” in this appendix;

• (vi) the articles of association of the Company; and

• (vii) this circular.

– 24 –

NOTICE OF EGM

==> picture [45 x 41] intentionally omitted <==

KAISA PROSPERITY HOLDINGS LIMITED 佳兆業美好集團有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 2168)

NOTICE IS HEREBY GIVEN that an extraordinary general meeting (the “ EGM ”) of the shareholders (the “ Shareholders ”) of Kaisa Prosperity Holdings Limited (the “ Company ”) will be held at Multi-Function Room, 26/F, Sino Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong on Tuesday, 24 December 2019 at 3 p.m. for the purpose of considering and, if thought fit, passing with or without amendments, the following resolution of the Company.

Capitalised terms used herein have the same meanings as those defined in the circular of the Company dated 6 December 2019.

ORDINARY RESOLUTION

“ THAT the Property Management Services Framework Agreement (as amended by the Supplemental Agreement), a copy of which is produced at the meeting and marked ‘‘A’’ and initialed by the chairman of the meeting for the purpose of identification, and the transactions contemplated thereby (including the annual caps) be and is hereby approved and confirmed and any one director of the Company be and is hereby authorised to do all such acts or things and sign all documents deemed necessary by him/her for the purpose of giving effect to the Property Management Services Framework Agreement (as amended by the Supplemental Agreement) and the transactions contemplated thereunder.”

By order of the Board KAISA PROSPERITY HOLDINGS LIMITED LIAO Chuanqiang Chairman

Hong Kong, 6 December 2019

Registered Office: Cricket Square Hutchins Drive P.O. Box 2681 Grand Cayman, KY1-1111 Cayman Islands

Principal Place of Business in Hong Kong: Room 1901 19/F, Lee Garden One 33 Hysan Avenue Causeway Bay Hong Kong

– EGM-1 –

NOTICE OF EGM

Notes:

1. Any Shareholder entitled to attend and vote at the EGM shall be entitled to appoint another person as his proxy to attend and vote instead of him. A proxy need not be a Shareholder. If more than one proxy is so appointed, the appointment shall specify the number and class of Shares in respect of which each such proxy is so appointed.

2. In the case of joint holders, the vote of the senior who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the vote(s) of the other joint holder(s); and for this purpose seniority shall be determined as the person so present whose name stands first on the register of members in respect of such share shall alone be entitled to vote in respect thereof.

3. In order to be valid, a form of proxy must be deposited at the Company’s Hong Kong branch share registrar and transfer office, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong together with the power of attorney or other authority (if any) under which it is signed (or a certified copy thereof) not less than 48 hours before the time appointed for the holding of the above meeting or any adjournment thereof (as the case may be). The completion and return of the form of proxy shall not preclude members of the Company from attending and voting in person at the above meeting (or any adjourned meeting thereof) if they so wish.

– EGM-2 –