Seazen Group Limited - Capital/Financing Update 2014

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

This announcement is for information purposes only and does not constitute an invitation or a solicitation of an offer to acquire, purchase or subscribe for securities or an invitation to enter into an agreement to do any such things, nor is it calculated to invite any offer to acquire, purchase or subscribe for any securities.

This announcement does not constitute an offer to sell or the solicitation of an offer to buy any securities in the United States or any other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No securities may be offered or sold in the United States absent registration or an applicable exemption from registration requirements. Any public offering of securities to be made in the United States will be made by means of a prospectus. Such prospectus will contain detailed information about the company making the offer and its management and financial statements. The Company does not intend to make any public offering of securities in the United States.

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Future Land Development Holdings Limited 新城發展控股有限公司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1030)

OVERSEAS REGULATORY ANNOUNCEMENT

This overseas regulatory announcement is issued pursuant to Rule 13.09 of the Rules Governing the Listing of Securities (the “ Listing Rules ”) on The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”).

Reference is made to the announcements of Future Land Development Holdings Limited (the “ Company ”) published on 14 July 2014 and 15 July 2014 in relation to the Notes Issue (the “ Announcements ”). Unless otherwise defined, all terms used herein shall have the same meanings as those defined in the Announcements.

The board of directors (“ Board ”) of the Company is pleased to announce that all the conditions precedent under the Purchase Agreement has been fulfilled and the Notes Issue has been completed on 21 July 2014.

Please refer to the attached offering memorandum in relation to the Notes (the “ Offering Memorandum ”), which has been published on the website of the Singapore Exchange Securities Trading Limited on 22 July 2014.

The posting of the Offering Memorandum on the website of the Stock Exchange is only for the purpose of facilitating equal dissemination of information to investors in Hong Kong and compliance with Rule 13.09 of the Listing Rules, and not for any other purpose. The Offering Memorandum does not constitute a prospectus, notice, circular, brochure, advertisement or document offering to sell any securities to the public in any jurisdiction, nor is it an invitation or solicitation to the public to make offers to acquire, subscribe for or purchase any securities, nor is it calculated to invite or solicit offers by the public to acquire, subscribe for or purchase any securities. The Offering Memorandum must not be regarded as an inducement to subscribe for or purchase any securities of the Company, and no such inducement is intended. No investment decision should be based on the information contained in the Offering Memorandum.

By Order of the Board Future Land Development Holdings Limited WANG Zhenhua Chairman

Hong Kong, 22 July 2014

As at the date of this announcement, our Directors are Mr. Wang Zhenhua, Mr. Min Yuansong, Mr. Liu Yuanman and Madam Huang Maoli as executive Directors, Mr. Lv Xiaoping and Mr. Wang Xiaosong as non-executive Director and Mr. Chen Huakang, Madam Nie Meisheng and Mr. Zhu Zengjin as independent non-executive Directors.

STRICTLY CONFIDENTIAL – DO NOT FORWARD

NOT FOR DISTRIBUTION IN THE UNITED STATES

IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the offering memorandum attached to this e-mail. You are therefore advised to read this disclaimer carefully before reading, accessing or making any other use of the attached offering memorandum. In accessing the attached offering memorandum, you agree to be bound by the following terms and conditions, including any modifications to them from time to time, each time you receive any information from Future Land Development Holdings Limited (the “Company”) as a result of such access.

Confirmation of Your Representation: You have accessed the attached offering memorandum on the basis that you have confirmed your representation to the Company and to J.P. Morgan Securities plc, Credit Suisse Securities (Europe) Limited, UBS AG, Hong Kong Branch, BNP Paribas, Hong Kong Branch, CLSA Limited and China Merchants Securities (HK) Co., Limited (the “Initial Purchasers”) that (1) you consent to delivery of the attached offering memorandum and any amendments or supplements thereto by electronic transmission and agree to the terms set forth herein; (2) (i) you are receiving this offering memorandum outside the United States and, to the extent you purchase the securities described in the attached offering memorandum, you will be doing so pursuant to Regulation S under the Securities Act of 1933, as amended (the “Securities Act”), and (ii) the e-mail address to which the attached offering memorandum has been delivered is not located in the United States (including the states and the District of Columbia), its territories, its possessions and other areas subject to its jurisdiction; and (3) you acknowledge that you will make your own assessment regarding any legal, taxation or other economic conditions with respect to your decision to subscribe for or purchase any securities.

The attached offering memorandum has been made available to you in electronic form. You are reminded that documents transmitted via this medium may be altered or changed during the process of transmission and consequently none of the Company, the Initial Purchasers or any person who controls any of them or any of their respective directors, employees, representatives or affiliates accepts any liability or responsibility whatsoever in respect of any discrepancies between the document distributed to you in electronic format and the hard copy version. The Company will provide a hard copy version to you upon request.

Restrictions: The attached offering memorandum is being furnished in connection with an offering exempt from registration under the Securities Act solely for the purpose of enabling prospective investors an opportunity to consider the purchase of the securities described therein. You are reminded that the information in the attached document is not complete and may be changed. Any investment decision should be made on the basis of a complete final offering memorandum.

Nothing in this electronic transmission constitutes an offer of securities for sale in any jurisdiction where it is unlawful to do so. Under no circumstances shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

THE NOTES, THE SUBSIDIARY GUARANTEES AND THE JV SUBSIDIARY GUARANTEES (IF ANY) (EACH AS DEFINED IN THE ATTACHED OFFERING MEMORANDUM) HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR OTHER JURISDICTION, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE OR LOCAL SECURITIES LAWS.

Except with respect to eligible investors in jurisdictions where such offer is permitted by law, nothing in this electronic transmission constitutes an offer or an invitation by or on behalf of the Company or the Initial Purchasers to subscribe for or purchase any of the securities described therein. If a jurisdiction requires that the offering be made by a licensed broker or dealer and any Initial Purchaser or any affiliate of the Initial Purchasers is a licensed broker or dealer in that jurisdiction, the offering shall be deemed to be made by such Initial Purchasers or such affiliate on behalf of the Company in such jurisdiction.

You are reminded that you have accessed the attached offering memorandum on the basis that you are a person into whose possession it may be lawfully delivered in accordance with the laws of the jurisdiction in which you are located. If you have gained access to this transmission contrary to the foregoing restrictions, you will be unable to purchase any of the securities described therein.

Actions That You May Not Take: You should not reply by e-mail to this announcement, and you may not purchase any securities by doing so. Any reply e-mail communications, including those you generate by using the “Reply” function on your e-mail software, will be ignored or rejected.

YOU ARE NOT AUTHORIZED AND YOU MAY NOT FORWARD OR DELIVER THE ATTACHED OFFERING MEMORANDUM, ELECTRONICALLY OR OTHERWISE, TO ANY OTHER PERSON OR REPRODUCE SUCH OFFERING MEMORANDUM IN ANY MANNER WHATSOEVER. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THE ATTACHED OFFERING MEMORANDUM, IN WHOLE OR IN PART, IS UNAUTHORIZED. FAILURE TO COMPLY WITH THIS DIRECTIVE MAY RESULT IN A VIOLATION OF THE SECURITIES ACT OR THE APPLICABLE LAWS OF OTHER JURISDICTIONS.

Your use of this e-mail is at your own risk and it is your responsibility to take precautions to ensure that it is free from viruses and other items of a destructive nature.

STRICTLY CONFIDENTIAL

OFFERING MEMORANDUM

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Future Land Development Holdings Limited 新城發展控股有限公司

(incorporated in the Cayman Islands with limited liability)

US$350,000,000 10.25% Senior Notes due 2019

Issue Price: 99.046%

Our 10.25% Senior Notes due 2019 (the “Notes”) will bear interest from July 21, 2014 at 10.25% per annum payable semi-annually in arrears on January 21 and July 21 of each year, beginning January 21, 2015. The Notes will mature on July 21, 2019 if not redeemed earlier. The Notes are general obligations of Future Land Development Holdings Limited (the “ Company ”), guaranteed by certain of our existing subsidiaries (the “ Subsidiary Guarantors ”), other than (1) those subsidiaries organized under the laws of the People’s Republic of China (the “ PRC ”) and (2) certain other subsidiaries specified in the section headed “Description of the Notes” (together, the “ Non-Guarantor Subsidiaries ”). We refer to the guarantees by the Subsidiary Guarantors as Subsidiary Guarantees. Under certain circumstances and subject to certain conditions, a Subsidiary Guarantee required to be provided by a subsidiary of the Company may be replaced by a limited-recourse guarantee, or JV Subsidiary Guarantee. We refer to the subsidiaries providing a JV Subsidiary Guarantee as JV Subsidiary Guarantors.

We may at our option redeem the Notes, in whole or in part, at any time and from time to time on or after July 21, 2017, at the redemption prices set forth in this offering memorandum plus accrued and unpaid interest, if any, to (but not including) the redemption date. At any time prior to July 21, 2017, we may at our option redeem the Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of such Notes plus the Applicable Premium (as defined herein) as of, plus accrued and unpaid interest, if any, to (but not including) the redemption date. At any time and from time to time prior to July 21, 2017, we may redeem up to 35% in aggregate principal amount of the Notes, at a redemption price of 110.25% of the principal amount, plus accrued and unpaid interest, if any, to (but not including) the redemption date, with the proceeds from sales of certain kinds of capital stock. Upon the occurrence of a Change of Control Triggering Event (as defined herein), we must make an offer to repurchase all Notes outstanding at a purchase price equal to 101% of their principal amount, plus accrued and unpaid interest, if any, to (but not including) the date of repurchase.

The Notes will be (1) senior in right of payment to any existing and future obligations of the Company expressly subordinated in right of payment to the Notes, (2) at least pari passu in right of payment against the Company with all other unsecured, unsubordinated Indebtedness of the Company (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law), (3) guaranteed by the Subsidiary Guarantors on a senior basis, subject to certain limitations described under the caption “Risk Factors – Risks Relating to the Guarantees and the Collateral” and “Description of the Notes – The Subsidiary Guarantees, (4) effectively subordinated to the other secured obligations of the Company (if any), the Subsidiary Guarantors and the JV Subsidiary Guarantors, to the extent of the value of the assets serving as security therefor, and (5) effectively subordinated to all existing and future obligations of the Non-Guarantor Subsidiaries. The Notes and the Subsidiary Guarantees will be secured by the capital stock of the Subsidiary Guarantors and the JV Subsidiary Guarantors (if any). In addition, applicable law may limit the enforceability of the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any) and the pledge of any collateral. See the section headed “Risk Factors – Risks Relating to the Guarantees and the Collateral.”

For a more detailed description of the Notes, see the section headed “Description of the Notes” beginning on page 191.

Investing in the Notes involves risks. See the section headed “Risk Factors” beginning on page 20.

Approval in-principle has been received for the listing and quotation of the Notes on the Singapore Exchange Securities Trading Limited (the “ SGX-ST ”). The SGX-ST assumes no responsibility for the correctness of any of the statements made or opinions or reports contained in this offering memorandum. The listing and quotation of the Notes on the SGX-ST is not to be taken as an indication of the merits of the Company, the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees (if any).

The Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any) have not been and will not be registered under the United States Securities Act of 1933, as amended (the “ Securities Act ”), and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities law. Accordingly, the Notes are being offered and sold by the Initial Purchasers only outside the United States in compliance with Regulation S under the Securities Act (“ Regulation S ”). For a description of certain restrictions on resale or transfer, see the section headed “Transfer Restrictions” beginning on page 260.

It is expected that delivery of the Notes will be made on or about July 21, 2014 through the book-entry facilities of Euroclear Bank S.A./N.V. (“ Euroclear ”) and Clearstream Banking, société anonyme, Luxembourg (“ Clearstream ”) against payment therefor in immediately available funds.

Joint Global Coordinators

J.P. Morgan Credit Suisse Joint Bookrunners J.P. Morgan Credit Suisse UBS BNP PARIBAS CLSA (A CITIC Securities Company) China Merchants Securities (HK)

The date of this offering memorandum is July 14, 2014.

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SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
THE OFFERING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
SUMMARY HISTORICAL FINANCIAL AND OTHER DATA . . . . . . . . . . . . . . . . . . . . . . . . . .	17
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	45
EXCHANGE RATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	46
CAPITALIZATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	47
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA . . . . . . . . . . . . . . . . . . . . . . . .	48
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	50
INDUSTRY OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	74
CORPORATE STRUCTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	95
BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	99
REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	152
DIRECTORS AND SENIOR MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	177
PRINCIPAL SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	182
RELATED PARTY TRANSACTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	183
RELATIONSHIP WITH JIANGSU FUTURE LAND. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	184
DESCRIPTION OF MATERIAL INDEBTEDNESS AND OTHER OBLIGATIONS . . . . . . . . . . . . .	185
DESCRIPTION OF THE NOTES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	191
TAXATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	252
PLAN OF DISTRIBUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	254
TRANSFER RESTRICTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	260
RATINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	261
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	261
INDEPENDENT AUDITOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	261
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	262
INDEX TO FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-1

– i –

NOTICE TO INVESTORS

This offering memorandum does not constitute an offer to sell to, or a solicitation of an offer to buy from, any person in any jurisdiction to whom it is unlawful to make the offer or solicitation in such jurisdiction. Neither the delivery of this offering memorandum nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in our affairs since the date of this offering memorandum or that the information contained in this offering memorandum is correct as of any time after that date.

This offering memorandum is highly confidential. We are providing it solely for the purpose of enabling you to consider a purchase of the Notes. You should read this offering memorandum before making a decision whether to purchase the Notes. You must not use this offering memorandum for any other purpose or disclose any information in this offering memorandum to any other person.

We have prepared this offering memorandum, and we are solely responsible for its contents. You are responsible for making your own examination of us and your own assessment of the merits and risks of investing in the Notes. By purchasing the Notes, you will be deemed to have acknowledged that you have made certain acknowledgements, representations and agreements as set forth under the section headed “Transfer Restrictions” below.

No representation or warranty, express or implied, is made by the Initial Purchasers, the Trustee, the Registrar, the Paying Agent, the Transfer Agent, the Collateral Agent, or any of their respective affiliates or advisers as to the accuracy or completeness of the information set forth herein, and nothing contained in this offering memorandum is, or should be relied upon as, a promise or representation, whether as to the past or the future.

Prospective investors in the Notes should rely only on the information contained in this offering memorandum. Each person receiving this offering memorandum acknowledges that: (i) such person has been afforded an opportunity to request from us and to review, and has received, all additional information considered by it to be necessary to verify the accuracy of, or to supplement, the information contained herein; (ii) such person has not relied on the Initial Purchasers, the Trustee, the Registrar, the Paying Agent, the Transfer Agent, the Collateral Agent, or any person affiliated with them in connection with any investigation of the accuracy of such information or its investment decision; and (iii) no person has been authorized to give any information or to make any representation concerning us, our subsidiaries and affiliates, the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees not contained in this offering memorandum and, if given or made, any such other information or representation should not be relied upon as having been authorized by us or the Initial Purchasers.

Prospective purchasers are hereby notified that sellers of the Notes, including the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any), may be relying on the exemption from the provisions of Section 5 of the Securities Act. We are not, and the Initial Purchasers are not, making an offer to sell the Notes, including the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any), in any jurisdiction except where an offer or sale is permitted. The distribution of this offering memorandum and the offering of the Notes, including the Subsidiary Guarantees, may in certain jurisdictions be restricted by law. Persons into whose possession this offering memorandum comes are required by us and the Initial Purchasers to inform themselves about and to observe any such restrictions. For a description of the restrictions on offers, sales and resales of the Notes, including the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any), and distribution of this offering memorandum, see the sections headed “Transfer Restrictions” and “Plan of Distribution” below.

This offering memorandum summarizes certain material documents and other information, and we refer you to them for a more complete understanding of what we discuss in this offering memorandum. In making an investment decision, you must rely on your own examination of us and the terms of the offering, including the merits and risks involved. We are not making any representation to you regarding the legality of an investment in the Notes by you under any legal, investment, taxation, or similar laws or regulations. You should not consider any information in this offering memorandum to be legal, business or tax advice. You should consult your own professional advisers for legal, business, tax and other advice regarding an investment in the Notes.

We and the Initial Purchasers reserve the right to reject any offer to purchase any Notes, in whole or in part, for any reason, or to sell less than the aggregate principal amount of the Notes offered by this offering memorandum.

– ii –

In connection with the issue of the Notes, J.P. Morgan Securities plc (or its affiliates), as stabilizing manager may, subject to applicable laws and regulations, purchase and sell the Notes in the open market with a view to supporting the market price of the Notes at a level higher than that which might otherwise prevail for a limited period after the time of delivery. However, there is no obligation on J.P. Morgan Securities plc to do so. If these activities are commenced, they may be discontinued at any time and must in any event be brought to an end after a limited time. These activities will be undertaken solely for the account of J.P. Morgan Securities plc and not for us or on our behalf.

– iii –

FORWARD-LOOKING STATEMENTS

This offering memorandum contains forward-looking statements that are, by their nature, subject to significant risks and uncertainties. These forward-looking statements include statements relating to:

our capital expenditure and property development plans;
our business and operating strategies and our ability to implement such strategies;
our ability to further develop and manage our projects as planned;
our capital commitment plans, particularly plans relating to acquisition of land for our property development and the development of our projects;
our operations and business prospects, including development plans and business opportunities that we may pursue;
the regulatory environment as well as the general industry outlook for our industry;
the performance and future developments of the property market in China;
exchange rate fluctuations and restrictions;
the general economic trend of the PRC and, in particular, Shanghai;
the interpretation and implementation of rules and regulations relating to land appreciation tax;
availability and costs of bank loans and other forms of financing;
our dividend policy;
changes in political, economic, legal and social conditions in China, including the policies of the PRC government affecting the regions where we operate that affect land supply, availability and cost of financing and pre-sales, pricing and volume of our property development projects;
our ability to obtain various permits, proper legal titles or approvals for our projects under development or held for future development; and
changes in competitive conditions and our ability to compete under these conditions.

In some cases, you can identify forward-looking statements by such terminology as “may,” “will,” “should,” “could,” “would,” “expect,” “intend,” “plan,” “anticipate,” “going forward,” “ought to,” “seek,” “project,” “forecast,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other comparable terminology. Such statements reflect the current views of our management with respect to future events, operations, results, liquidity and capital resources and are not guarantee of future performance and some of which may not materialize or may change. Although we believe that the expectations reflected in these forward-looking statements are reasonable, we cannot assure you that those expectations will prove to be correct, and you are cautioned not to place undue reliance on such statements. In addition, unanticipated events may adversely affect the actual results we achieve. Important factors that could cause actual results to differ materially from our expectations are disclosed under the section headed “Risk Factors” in this offering memorandum. Except as required by law, we undertake no obligation to update or otherwise revise any forwardlooking statements contained in this offering memorandum, whether as a result of new information, future events or otherwise after the date of this offering memorandum.

All forward-looking statements contained in this offering memorandum are qualified by reference to the cautionary statements set forth in this section.

– iv –

ENFORCEMENT OF CIVIL LIABILITIES

We are an exempted company incorporated in the Cayman Islands with limited liability, and each Subsidiary Guarantor and JV Subsidiary Guarantor (if any) is also incorporated or may be incorporated, as the case may be, outside the United States, such as Hong Kong. The Cayman Islands, Hong Kong and other jurisdictions have different bodies of securities laws from the United States and protections for investors may differ.

All of our assets and all of the assets of the Subsidiary Guarantors are located outside the United States. In addition, all of our directors and officers and the Subsidiary Guarantors’ directors and officers are nationals or residents of countries other than the United States (principally of the PRC), and all or a substantial portion of such persons’ assets are located outside the United States. As a result, it may be difficult for investors to effect service of process within the United States upon us, any of the Subsidiary Guarantors or such directors and officers or to enforce against us or any of the Subsidiary Guarantors or such directors and officers judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof.

We and each of the Subsidiary Guarantors expect to appoint National Corporate Research, Ltd. as our and their respective agent to receive service of process with respect to any action brought against us or any Subsidiary Guarantor in the United States federal courts located in the Borough of Manhattan, The City of New York under the federal securities laws of the United States or of any state of the United States or any action brought against us or any Subsidiary Guarantor in the courts of the State of New York in the Borough of Manhattan, The City of New York under the securities laws of the State of New York.

We have been advised by our Cayman Islands legal adviser, Maples and Calder, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the securities laws of the United States or any state and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state, on the grounds that such provisions are penal in nature. However, in the case of laws that are not penal in nature, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a judgment of a foreign court of competent jurisdiction without retrial on the merits, by an action commenced on the foreign judgment debt in the Grand Court of the Cayman Islands, based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor a liability to pay the sum for which judgment has been given provided that such judgment is final and conclusive, for a liquidated sum, not in respect of taxes or a fine or penalty, is not inconsistent with a Cayman Islands’ judgment in respect of the same matter, and was not obtained in a manner, and is not a kind the enforcement of which is, contrary to the natural justice or public policy of the Cayman Islands. A Cayman Islands court may stay proceedings if concurrent proceedings are being brought elsewhere.

We have been advised by our Hong Kong legal adviser, Shearman & Sterling, that Hong Kong has no arrangement for the reciprocal enforcement of judgments with the United States. However, under Hong Kong common law, a foreign judgment (including one from a court in the United States predicate upon U.S. federal or state securities laws) may be enforced in Hong Kong by bringing an action in a Hong Kong court, and then seeking summary or default judgment on the strength of the foreign judgment, provided that the foreign court is a court of competent jurisdiction, the foreign judgment is for a debt or definite sum of money and is final and conclusive on the merits.

We have also been advised by our PRC legal adviser, Shu Jin Law Firm, that there is uncertainty as to whether the courts of China would (i) enforce judgments of U.S. courts obtained against us, our directors or officers, any Subsidiary Guarantor or JV Subsidiary Guarantor or their directors or officers predicated upon the civil liability provisions of the U.S. federal or state securities laws or (ii) entertain original actions brought in China against us, our directors or officers, any Subsidiary Guarantor or JV Subsidiary Guarantor or their directors or officers predicated upon the U.S. federal or state securities laws.

– v –

CERTAIN DEFINITIONS, CONVENTIONS AND CURRENCY PRESENTATION

We have prepared this offering memorandum using a number of conventions that you should consider when reading the information contained herein. All references to “we,” “us,” “our,” “our Company” and “Group” refer to Future Land Development Holdings Limited and, as the context requires, its subsidiaries; all references to “our IPO” mean our initial public offering of our ordinary shares listed on the Hong Kong Stock Exchange in November 2012; all references to “US$” and “U.S. dollars” are to United States dollars; all references to “RMB”, “CNY” or “Renminbi” are to Renminbi, the official currency of the People’s Republic of China; all references to “PRC” and “China” are to the People’s Republic of China, excluding the Hong Kong Special Administrative Region of the PRC, the Macau Special Administrative Region of the PRC and Taiwan; and all references to “PRC government” or “State” means the central government of the PRC, including all political subdivisions (including provincial, municipal and other regional or local governments) and instrumentalities thereof, or, where the context requires, any of them.

We record and publish our financial statements in Renminbi. Solely for your convenience, this offering memorandum contains translations of Renminbi amounts into U.S. dollars at specified rates. Unless otherwise stated in this offering memorandum, all translations from Renminbi amounts to U.S. dollars were made at the rate of RMB6.0537 to US$1.00 (the noon buying rate in New York City for cable transfers as certified for customs purposes by the Federal Reserve Bank of New York on December 31, 2013, as set forth in the H.10 weekly statistical release of the Federal Reserve Board). All such translations in this offering memorandum are provided solely for your convenience, and we make no representation that the Renminbi amounts referred to herein have been, could have been or could be converted into U.S. dollars, or vice versa, at any particular rate or at all. For further information relating to the exchange rates, see the section headed “Exchange Rate Information.”

Our financial information is prepared in accordance with Hong Kong Financial Reporting Standards (“ HKFRSs ”) which differ in certain respects from generally accepted accounting principles in certain other countries. We have made no attempt to quantify the impact of those differences. In making an investment decision, investors must rely upon their own examination of us, the terms of the offering and the financial information. Potential investors should consult their own professional advisers for an understanding of the differences between HKFRSs and generally accepted accounting principles in other jurisdictions and how those differences might affect the financial information herein.

Market data, industry forecasts and PRC and property industry statistics in this offering memorandum have been derived from various government and private publications. Although we believe this information to be reliable, it has not been independently verified by us or the Initial Purchasers or their respective directors and advisers. None of us, the Initial Purchasers, or our or its respective directors and advisers makes any representation as to the accuracy or completeness of that information. In addition, third-party information providers may have obtained information from market participants and such information may not have been independently verified. We commissioned China Index Academy to prepare an industry report in 2012 for our IPO, which is cited herein. Due to possibly inconsistent collection methods and other problems, such statistics herein may be inaccurate and should not be unduly relied upon.

A property is considered sold after we have executed the purchase contract with a customer and have delivered the property to the customer. All site area and gross floor area, or GFA, information presented in this offering memorandum represent the site area and GFA of the entire project, including those attributable to the non-controlling interests of our non-wholly owned project companies.

Totals presented in this offering memorandum may not total correctly because of rounding of numbers. The English names of the PRC entities or organizations in this offering memorandum marked “*” are translations from their Chinese names and are for identification purposes only. If there is any inconsistency, the Chinese name shall prevail.

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Additional terms used in this offering memorandum are defined below.

“average selling price” or “ASP” . . . average selling price on a gross basis, unless otherwise stated “April 2016 Notes”. . . . . . . . . . . . . the CNY1,500,000,000 9.75% Senior Notes due 2016 of the Company issued on April 23, 2013
“CAGR” . . . . . . . . . . . . . . . . . . . . compound annual growth rate “Chairman Wang”. . . . . . . . . . . . . . Mr. Wang Zhenhua (王振華), our founder, director and controlling shareholder
“commodity properties”. . . . . . . . . . residential properties, commercial properties and other buildings that are developed by property developers for the purposes of sale or lease after their completion
“completion certificate”. . . . . . . . . . construction work completion inspection certificate issued by local urban construction bureaus or equivalent authorities in China with respect to the completion of property projects subsequent to their on-site examination and inspection (竣工備案表)
“GFA” . . . . . . . . . . . . . . . . . . . . . gross floor area
“Jiangsu Future Land”. . . . . . . . . . . Jiangsu Future Land Co., Ltd. (江蘇新城地產股份有限公司)*, our subsidiary established on October 10, 1997 with B-shares listed on the Shanghai Stock Exchange (Stock Code: 900950)
“land grant contract”. . . . . . . . . . . . an agreement we and the relevant local government authority enter into after the public tender, auction or listing-for-sale (as applicable), which provides for, among other things, the amount of land grant premium that we should pay for acquiring the land use rights of the relevant land parcel. After we have paid the land grant premium and satisfied any other conditions as set forth in the land grant or land use rights contract, we will obtain a land use rights certificate for the relevant land parcel (國有土地使用權出讓合同)
“land use rights certificate” . . . . . . . a certificate (or certificates as the case may be) of the rights of a party to use a parcel of land (土地使用權證)
“LAT”. . . . . . . . . . . . . . . . . . . . . . land appreciation tax (土地增值稅) as defined in the PRC Provisional Regulations on Land Appreciation Tax of 1994 and its implementation rules
“January 2018 Notes” . . . . . . . . . . . the US$200,000,000 10.25% Senior Notes due 2018 of the Company issued on January 31, 2013
“rentable GFA” . . . . . . . . . . . . . . . in relation to (i) completed property projects, the total GFA shown in the relevant completion documents, survey documents and/or property ownership certificates for leasing purposes; and (ii) projects where we have obtained pre-sale permits, the leasable GFA as shown in the pre-sale permits, completion documents, survey documents and/or property ownership certificates for leasing purposes

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“salable GFA” . . . . . . . . . . . . . . . .

“total gross floor area” or “total GFA” . . . . . . . . . . . . . . . .
in relation to (i) completed property projects, the total GFA shown in the relevant completion documents, survey documents and/or property ownership certificates for sale purposes; and (ii) projects where we have obtained pre-sale permits, the salable GFA as shown in the pre-sale permits, completion documents, survey documents and/or property ownership certificates for sales purposes

the above-ground and underground salable and/or leasable area contained within the external walls of any building at each floor level and the whole thickness of the external walls of the relevant project together with other non-leasable and non-salable area. In general this includes mechanical and electrical services rooms, refuse rooms, water tanks, car parks, lifts and staircases; all site area and GFA information presented in this offering memorandum represent the site area and GFA of the entire project, including those attributable to the noncontrolling interests of non-wholly owned project companies included in our consolidated financial statements

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SUMMARY

This summary does not contain all the information that may be important to you in deciding to invest in the Notes. You should read the entire offering memorandum, including the section headed “Risk Factors” and our consolidated financial statements and related notes thereto, before making an investment decision. To understand the terms of the Notes, you should carefully read the section headed “Description of the Notes.”

Overview

We are a leading property developer in the Yangtze River Delta, focusing primarily on the development of quality residential properties and mixed-use complex projects. According to a report by the China Index Academy[(1)] , we were ranked as one of the top three property developers in Jiangsu Province and among the top ten in Shanghai in 2011, 2012 and 2013 in terms of contracted sales. We were ranked first among the property developers in Jiangsu Province and among the top ten in Shanghai in 2013 in terms of contracted GFA.

From our establishment in 1996 to December 31, 2013, we completed 42 property projects and 20 project phases with an aggregate GFA of approximately 15.3 million sq.m. In addition, we had 51 property projects in ten cities which were under development or held for future development. These projects included approximately 3.9 million sq.m. under development and approximately 8.1 million sq.m. held for future development. As of December 31, 2013, we had land reserves with a total estimated GFA of 13.9 million sq.m., of which 12.5 million sq.m. are located along the Shanghai-Nanjing Economic Corridor.

Our Property Development Operations

Property development operations comprise, among other things, land acquisition, product development and construction, property sales and pre-sales and property management. For product development and construction, we engage third-party contractors to provide a wide range of services which include, without limitation, architectural and interior design, construction, electromechanical engineering and landscaping. To shorten the period between site acquisition, pre-sale and completion of our properties, we have adopted a “rapid asset turnover” business model for our property development operations. As a result, we have been able to rapidly replicate our projects, shorten development cycles, maximize investment returns, improve cash flows and mitigate liquidity risks. For the years ended December 31, 2011, 2012 and 2013, our asset turnover ratio[(2)] was 0.33, 0.45 and 0.47, respectively.

Our Diversified Product Offerings

We develop and sell a variety of residential property types, through four residential property series, namely, our “FirstHomes” series, “SweetHomes” series, “DreamHomes” series and “PrestigeHomes” series, to target different customers groups, including first time buyers, young families, mid-to-high income households and high net worth individuals. We also develop large-scale, mixed-use complex projects that typically consist of a combination of shopping malls, offices, hotels, serviced apartments, residential properties and other ancillary facilities. We offer three mixed-use complex project series, namely our “International Plaza” series, “City Plaza” series and “Lifestyle Mall” series, to meet the needs and preferences of customers in different locations, including central business districts and emerging business districts.

(1) China Index Academy derived the information in the report from its self-developed database, CREIS China Index Database and the database of fdc.soufun.com. These databases, which comprise data from the Housing Administration Real Estate Exchanges Centres of Jiangsu Province, Changzhou and Shanghai and the annual reports and corporate returns of listed real estate companies, have been widely used and relied upon in the PRC property market.

(2) Asset turnover ratio is calculated by dividing revenue during a given year, by the average of total assets at the beginning and the end of the year.

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The tables below set forth the breakdown of our revenue by revenue source and by property type, and the total salable GFA that we delivered and ASP for each type of property during the years indicated:

						Year ended December	Year ended December	Year ended December

					2011			2012	2013

					(RMB)			(RMB)	(RMB)
							(in thousands)
Revenue
Sales of properties . . . . . . . . . . . . . . . . . . . . . . . . .				. .	10,688,562			17,341,932	20,421,811
Property management		. . . . . . . . . . . . . . . . . . . . . .		. .	72,088			121,469	182,501
Rental income	. . . . . . . . . . . . . . . . . . . . . . . . . . . .			. .	4,960			35,620	102,356
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .				. .	1,644			18,245	64,587

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .				. .	10,767,254			17,517,266	20,771,255

			Residential					Commercial(1)

		Revenue	GFA		ASP	Revenue		GFA	ASP

		(RMB’000)	(sq.m.)	(RMB/sq.m.)		(RMB’000) (sq.m.)			(RMB/sq.m.)
2011 . . . . . . . . . . . . .		9,576,635	1,288,019		7,435	1,111,927 108,897			10,211
2012 . . . . . . . . . . . . .		15,446,775	1,779,081		8,682	1,895,156 138,829			13,651
2013 . . . . . . . . . . . . .		18,337,286	2,293,376		7,996	2,084,525 181,722			11,471

(1) Includes retail and commercial areas in residential projects and commercial properties in mixed-use complex projects.

Our Strategically Located Property Project Portfolio

Our portfolio is comprised of strategically located property projects, which we believe, provides strong support for our continued growth. The following tables set out the geographic break down of our property portfolio as of December 31, 2013:

==> picture [440 x 245] intentionally omitted <==

----- Start of picture text -----

Nanjing Zhenjiang Changzhou
Status GFA (sq.m.) Status GFA (sq.m.) Status GFA (sq.m.)
Completed 42,910 Completed - Completed 1,014,857
Under Development 658,605 Under Development 16,201 Under Development 1,281,798
Future Development 360,378 Future Development 756,611 Future Development 2,932,181
Total 1,061,893 Total 772,812 Total 5,228,836
Wuhan
Nantong
Status GFA (sq.m.) Status GFA (sq.m.)
Completed 60,508 Completed -
Under Development 38,883 To Beijing Under Development -
Future Development - Nanjing Zhenjiang Future Development 556,728
Total 99,391 Total 556,728
Nantong
Changsha Changzhou Suzhou
Shanghai
Status GFA (sq.m.) Wuxi Shanghai
Wuhan Status GFA (sq.m.)
Completed 92,901
Completed 279,487
Under Development 201,700
Under Development 645,077
Future Development 785,198
Future Development 568,027
Total 1,079,799 Changsha Hangzhou Total 1,492,591
Wuxi Suzhou Hangzhou
Status GFA (sq.m.) Status GFA (sq.m.) Status GFA (sq.m.)
Completed 129,120 Completed [1] 224,827 Completed -
Under Development 241,462 Under Development 790,771 Under Development -
Future Development 137,222 Future Development 1,841,484 Future Development 197,874
Total 507,804 Total 2,857,082 Total 197,874
----- End of picture text -----

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The following table sets out the geographic breakdown of our contracted sales during the years indicated:

			Year ended	December 31,	December 31,

	2011		2012			2013

	Contracted		Contracted			Contracted
	sales	% of total	sales	% of total		sales	% of total
	(RMB	contracted	(RMB	contracted		(RMB	contracted
	million)	sales	million)		sales	million)	sales

Changzhou . . . . . . . . . . . . . . . .	7,037.3	50.7%	6,620.8		41.7%	5,753.9	28.4%
Shanghai . . . . . . . . . . . . . . . . .	4,414.4	31.8%	4,886.1		30.7%	5,665.0	28.0%
Nanjing . . . . . . . . . . . . . . . . . .	684.7	4.9%	1,207.3		7.6%	2,201.8	10.9%
Suzhou . . . . . . . . . . . . . . . . . . .	730.8	5.3%	1,199.0		7.5%	3,120.7	15.3%
Wuxi. . . . . . . . . . . . . . . . . . . . .	801.7	5.8%	936.4		5.9%	1,458.1	7.2%
Changsha . . . . . . . . . . . . . . . . .	191.4	1.4%	531.4		3.4%	598.3	3.0%
Kunshan . . . . . . . . . . . . . . . . . .	31.9	0.2%	409.1		2.6%	697.5	3.5%
Wuhan . . . . . . . . . . . . . . . . . . .	0.0	0.0%	103.6		0.6%	721.8	3.6%
Zhenjiang. . . . . . . . . . . . . . . . .	0.0	0.0%	0.0		0.0%	27.6	0.1%
Total . . . . . . . . . . . . . . . . . . . .	13,892.2	100.0%	15,893.7		100.0%	20,244.7	100.0%

Notes: Contracted sales exclude sales of car parks.

Our Competitive Strengths

We believe the following are our key competitive strengths.

One of the leading property developers in the Yangtze River Delta

We are a leading property developer in the Yangtze River Delta, a fast-growing region in the PRC. According to a report by the China Index Academy, we were ranked as one of the top three property developers in Jiangsu Province and among the top ten in Shanghai in 2011, 2012 and 2013 in terms of contracted sales. We were ranked first among the property developers in Jiangsu Province and among the top ten in Shanghai in 2013 in terms of contracted GFA. We were ranked first in terms of overall strength among property developers in Jiangsu Province for nine consecutive years from 2005 according to the annual rankings published by the Jiangsu Real Estate Association (江蘇省房地產協會). We were also ranked first among the “Top 10 Valuable Real Estate Brands in Eastern China” (中國華東房地產公司品牌價值TOP10) from 2007 to 2013 and ranked 18th among the “2014 Top 100 China Real Estate Enterprises” (2014中國房地產百強企業), according to the Top 10 China Real Estate Research Group[(3)] (中國房地產TOP10研究組). Our market-leading position, profitability, and growth potential received further recognition in 2011, as we were named by the China Real Estate Research Association (中國房地產研究會), China Real Estate Industry Federation (中國房地產業協會) and China Real Estate Evaluation Center (中國房地產測評中心) as one of the “Top 20 Real Estate Development Enterprises in China” (中國房地產開發企業20強) and “Top 20 Valuable Real Estate Development Brands in China” (中國房地產開發企業品牌價值20強).

We have a proven track record of developing quality residential properties in Jiangsu Province and in the Yangtze River Delta. From our establishment in 1996 to December 31, 2013, we completed 42 property projects and 20 project phases with an aggregate completed GFA of approximately 15.3 million sq.m. Leveraging on our premium brand, strong execution capabilities, rapid asset turnover model and property development experience, we have successfully expanded into other cities including Shanghai, Nanjing, Hangzhou, Wuxi, Suzhou, Nantong and Zhenjiang in the Yangtze River Delta, Changsha in Hunan Province and Wuhan in Hubei Province. We believe our strong track record is attributable to our execution capabilities and our ability to identify cities and regions with high growth potential.

(3) The Top 10 China Real Estate Research Group (中國房地產TOP10研究組) is a research team jointly established by the Enterprise Research Institute of the Development Research Centre of the State Council (國務院發展研究中心企業研究所), Tsinghua University Real Estate Research Institute (清華大學房地產研究所) and China Index Research Institute (中國指數研究院).

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Our rapid asset turnover model and standardized development process enable us to maximize our investment returns and improve our operating cash flows

We believe our rapid asset turnover, which we achieve by applying our standardized process for property development, is one of the key factors to our success. Our rapid asset turnover enables us to maximize our investment returns and improve operating cash flows by shortening our property development cycle. We have established a standardized development process for developing property with the use of standardized procedures, components and units since 2005. We established our own architectural design institute in 2007 and possess in-house architectural expertise. Our standardized development process is designed with our customers’ needs and satisfaction in mind and covers the full spectrum of our business operations, including site selection, procurement, property design, construction and quality control, aesthetics, interior design and customer service. As a result, we have been able to efficiently replicate our property projects and consistently deliver high quality properties across various market segments in affluent cities along the Shanghai-Nanjing Economic Corridor. For instance, we acquired the land parcel for the Wujiang Injoy Plaza (吳江吾悅廣場) in May 2013 and commenced pre-sales and generated cash receipts approximately five months after land acquisition. For the years ended December 31, 2011, 2012 and 2013, our asset turnover ratio was 0.33, 0.45 and 0.47, respectively, which we believe was competitive in the PRC property industry.

We were ranked fourth in terms of operating efficiency[(4)] among the top 500 property developers in China according to the “China Property Development Enterprise 500” (中國房地產開發企業500強) issued jointly by the China Real Estate Research Association (中國房地產研究會), China Real Estate Association (中國房地產業協會) and China Real Estate Appraisal Centre (中國房地產測評中心) in 2012.

As a result of our standardized development process and operating efficiency, we have the ability to develop projects rapidly, which enhances our profitability and growth potential. In 2013, we were ranked top 10 among “China Top 100 Real Estate Developers” (中國房地產百強企業), in terms of both consistency and efficiency potential by the Top 10 China Real Estate Research Group (中國房地產TOP10研究組). Going forward, we believe our rapid asset turnover model for property development will allow us to efficiently allocate our capital and resources and develop new projects in a timely manner.

Diversified product portfolio with a strategic focus on middle class customers in the PRC

We offer a wide range of residential properties that target the specific preferences and needs of middle class customers. We believe that there is significant demand in our markets for high quality residential properties, and such demand will continue to increase, as the purchasing power of middle class customers continues to grow in the future.

Our in-depth knowledge of local markets enables us to offer residential property products to targeted segments among middle class customers. We develop and sell a variety of residential properties, including high-rise apartments, mid-rise apartments, townhouses and luxury stand-alone houses. Our residential properties are divided into four series, namely, our “FirstHomes” series, “SweetHomes” series, “DreamHomes” series and “PrestigeHomes” series, to target different customer groups, including first time buyers, young families, mid-to-high income households and high net worth individuals. These residential property series are designed to meet the evolving needs of middle class customers as their disposable income increases. We believe our focus on middle class customers has enabled us to capitalize on the large population and strong purchasing power of this customer group, and we believe our diversified product offerings have allowed us to penetrate into different segments within our target group of middle class customers.

To further diversify our product portfolio, we started developing commercial properties in 2008. We develop large-scale, mixed-use complex projects that typically consist of a combination of shopping malls, offices, hotels, serviced apartments, high-end residential properties and other ancillary facilities through three mixed-use complex project series, namely, our “International Plaza” series, “City Plaza” series and “Lifestyle Mall” series, to meet the needs and preferences of customers in different types of locations, including central business districts and emerging business districts. We hold some of our commercial properties in prime locations for long-term investment and sell the remaining portion. In addition to generating recurring rental income, we are also able to enjoy potential capital appreciation from our commercial properties over the long term.

(4) “China Property Development Enterprise 500” (中國房地產開發企業500強) ranks property developers by operating efficiency based on their operating cycle, inventory cycle, inventory turnover, payable turnover, asset turnover, current asset turnover and fixed asset turnover.

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Strategically located land reserves, which we believe provide strong support for continued growth

Over the years, we have acquired land reserves in selected cities to establish a platform to support our continued growth. The majority of our land reserves are sizeable and concentrated in major cities along the Shanghai-Nanjing Economic Corridor in the Yangtze River Delta. These cities are located close to, and have easy access to, major roads and railway networks, including the Shanghai-Nanjing Expressway, ShanghaiNanjing Inter-city High Speed Railway and Beijing-Shanghai High Speed Railway, which increase the value and marketability of these properties. As of December 31, 2013, we had land reserves with a total estimated GFA of 13.9 million sq.m., of which 12.5 million sq.m. are located along the Shanghai-Nanjing Economic Corridor.

Our markets are in affluent second and third-tier cities in the Yangtze River Delta, where competition is less intense than first-tier cities in China. This has enabled and will continue to enable us to capitalize on the strong economic development and significant demand in these local real estate markets. Furthermore, some of our markets are not subject to local policy and regulation restrictions. As of December 31, 2013, approximately 68.6% of our land reserves were located in areas where additional local “purchase restrictions” had not been adopted[(5)] .

Highly skilled and experienced management team with a strong commitment to high corporate governance standards

We have a highly experienced and driven senior management team with proven execution capability. The key members of our management team have knowledge and experience that have enabled them to manage and oversee the operation and growth of our business. Our team’s collective knowledge, broad experience and strong execution capability were recognized in 2011 by China Real Estate Research Association (中國房地產研究會), China Real Estate Association (中國房地產業協會) and China Real Estate Appraisal Centre (中國房地產測評中心), which collectively ranked us fourth as measured by operational efficiency in the “China Property Development Enterprise 500” event (2011年中國房地產開發企業500強), a significant national award event for PRC real estate developers. We were also ranked 18th among the “2014 Top 100 China Real Estate Enterprises” (2014年中國房地產百強企業), according to the Top 10 China Real Estate Research Group (中國房地產 TOP10 研究組).

Our founder, Chairman Wang, has 22 years of experience in the PRC real estate industry. Other members of our management team are also highly experienced in the real estate development industry, with an average of over ten years of relevant experience. We believe our management team’s experience, together with their strong commitment to high corporate governance standards, will help us to achieve sustainable long-term growth and to maximize the value of our business.

Our Business Strategies

Our goal is to become one of the most competitive and profitable property developers in the PRC committed to achieving sustainable growth, adhering to high corporate and managerial standards and maximizing shareholders’ returns. We plan to implement the following strategies to achieve our goal.

Continue to strengthen our leadership position in the Yangtze River Delta region

We intend to strengthen our leadership position in the Yangtze River Delta region and benefit from its economic growth. Leveraging on our in-depth understanding of the local markets and our experience in property development, we will continue to apply our standardized development process to our product offerings to enhance our reputation and brand awareness. Our strong execution capabilities, combined with our scalable business model, provide a solid base from which to expand quickly in the local markets, and to acquire and develop new projects in an efficient manner. In addition to our primary regional focus in cities such as Changzhou, Shanghai, Nanjing, Wuxi and Suzhou, we intend to expand into other cities that have high growth potential in the Yangtze River Delta region, including Zhenjiang, Hangzhou and Nantong. We will continue to adopt a prudent and disciplined approach when selecting target cities for expansion, taking into account timing and market conditions to ensure our financial performance and liquidity.

(5) These reserves include our projects in Changzhou (including Jintan), Kunshan, Wujiang, Zhenjiang, Suburban areas of Changsha, Nantong, Danyang, Zhangjiagang. See “Industry Overview – Overview of Selected Key Cities” for information on restrictive measures adopted by the local governments of the relevant cities.

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Focus on increasing quality land reserves at competitive prices

We plan to continue to increase our land reserves at competitive prices to sustain our continued growth. In 2013, we acquired 16 parcels of land with a total GFA of approximately 3,544,570 sq.m. at an average cost of approximately RMB2,351 per sq.m. We will continue to maintain our product positioning and optimize our product offerings, taking into account factors such as project location, access to public transportation and surrounding infrastructure, to enhance the value of the land reserves. We intend to continue to acquire quality land reserves for our residential property development projects through our B-share listed subsidiary, Jiangsu Future Land. At the same time, we also intend to strategically select high quality sites in the Yangtze River Delta region and other areas with high economic growth potential that are suitable for developing large, mixed-use complexes and integrated residential properties. We believe that our well recognized brand name and experience in developing property projects will continue to allow us to identify opportunities to acquire land reserves in prime locations for both our residential and mixed-use complex projects.

Increase customer satisfaction by improving property management services and enhancing our brand recognition

We believe our provision of property management services will help increase the property value, brand recognition and customer satisfaction of our projects. We intend to continue to expand the scope of services of our property management business and to improve our service quality. To offer an effective communication platform with our customers, we have established the “Future Land Community” (新城會), through which our own project development team and management team can maintain close contact with our customers, understand their needs and spending preferences, as well as encourage them to make purchase recommendations and refer friends and family. In addition, we plan to further improve our property management business by increasing the number of our property management staff and updating our property management service policies and guidelines. We have engaged The Gallup Organization to conduct a customer satisfaction survey and collect customer feedback to guide our efforts to improve our property management services.

Diversify our project portfolio by further expanding our commercial property development operations

Building upon our strength in residential properties, we have developed mixed-use complex projects comprising offices, retail stores, serviced apartments and other ancillary facilities, which we offer primarily for sale or hold for long-term investment. We believe demand for commercial properties will continue to increase as economic activity grows in China. We intend to further increase our presence in the commercial property market. We believe that the commercial properties that we hold will generate sustainable rental income, thereby enhancing the stability of our revenue streams and diversifying the risk we face in the residential property market.

Attract, retain and motivate talented personnel through systematic training programs and competitive remuneration packages

We are committed to building a professional and highly specialized team with strong execution capabilities that shares and approves of our values, vision and corporate culture. We believe our success and future growth strategies depend on our ability to attract and retain talented professionals with experience and growth potential.

We offer systemic and comprehensive training programs to our employees and sponsor many of our senior management personnel to take courses at business schools in China to improve their leadership skills. We plan to continue to offer competitive remuneration packages to attract and retain talented professionals. We will offer our employees a wide range of performance incentives, including bonuses and share-based incentives, to align our employees’ interests with ours and to foster a higher level of recognition and approval of our corporate value and culture.

Recent Developments

Land Acquisitions and Land Premium Payments after December 31, 2013

On March 28, 2014, we entered into land use rights contracts with the local government and acquired the land use rights of a parcel of land in Xianling Lake, Nanjing. The amount of land premium was approximately RMB3,000.0 million, of which RMB1,500.0 million has been paid as of the date of this offering memorandum. The parcel of land occupies an aggregate site area of approximately 147,521 sq.m. and has a total GFA of approximately 368,802 sq.m.

– 6 –

On April 10, 2014, we entered into a share purchase agreement with Chongqing Longxin Real Estate (Group) Co., Ltd., an independent third party, pursuant to which we acquired Plot C2-6 in Jiading, Shanghai. The consideration to acquire Plot C2-6 is RMB466.0 million. The plot occupies an aggregate site area of approximately 25,209 sq.m. and has a total GFA of approximately 63,023 sq.m.

On April 30, 2014, we entered into land use rights contracts with the local government and acquired the land use rights of a parcel of land in Yuhang District, Hangzhou. The amount of land premium was approximately RMB403.2 million, of which RMB201.6 million has been paid as of the date of this offering memorandum. The parcel of land occupies an aggregate site area of approximately 33,598 sq.m. and has a total GFA of approximately 50,397 sq.m.

Since December 31, 2013, we have fully paid the remaining land premium in aggregate amount of RMB1,334.0 million for Plot of Yongfeng Street, Songjiang, Wujiang Injoy Plaza, Zhangjiagang Injoy Plaza and Plot of Future Sci-Tech City in Yuhang District. In addition, as of the date of this offering memorandum, we have paid the land premium in aggregate amount of RMB675.3 million for Danyang Injoy Plaza, Nantong Plot No. CR13043, Plot No. R21-04 of Hangzhou Shenhua Unit and Kunshan Future Land Territory West Project.

Trust Financing Arrangements and Bank Borrowings after December 31, 2013

In January 2014, we entered into two trust financing arrangements with Jiangsu International Trust Corporation Limited to obtain trust loans in total principal amount of approximately RMB539.3 million[1] for two projects, Suzhou Fragrant Legend (蘇州香溢瀾橋) and Changzhou Future Success (香溢俊園). Jiangsu Future Land provided guarantees for the two trust loans. The term of each trust loan is from January 3, 2014 to December 13, 2014.

Our Performance in the Six Months Ended June 30, 2014

For the six months ended June 30, 2014, we had contracted sales of approximately RMB9,711 million, representing an increase of 27.6% as compared to the six months ended June 30, 2013. Our contracted GFA increased 19.1% to approximately 1,029,400 sq.m. for the six months ended June 30, 2014 from approximately 864,000 sq.m. for the six months ended June 30, 2013.

Jiangsu Future Land Performance in the Three Months Ended March 31, 2014

On April 22, 2014, we announced the financial results of Jiangsu Future Land for the three months ended March 31, 2014 on the Hong Kong Stock Exchange in accordance with the rules of the Shanghai Stock Exchange and the Hong Kong Stock Exchange. The operating revenue and net profit of Jiangsu Future Land increased in the three months ended March 31, 2014 as compared to the three months ended March 31, 2013.

On June 16, 2014, Jiangsu Future Land received formal approval from the China Securities Regulatory Commission to, among other things, issue corporate bonds of up to RMB2,000 million in principal amount to the public in China. The approval will expire on December 17, 2014.

Corporate Information

We are a limited liability company incorporated under the laws of the Cayman Islands. In November 2012, our ordinary shares were listed on the main board of the Hong Kong Stock Exchange (Stock Code: 01030), and our market capitalization was approximately HK$4,081.0 million as of July 7, 2014. Our subsidiary, Jiangsu Future Land (Stock Code: 900950), has B shares listed on the Shanghai Stock Exchange.

1 We have RMB125.0 million on deposit with Jiangsu International Trust Corporation Limited which can be used to set off the outstanding amount of such trust loans.

– 7 –

==> picture [457 x 680] intentionally omitted <==

----- Start of picture text -----

50%
50% 50% 50%
Offshore PRC/Onshore
) ) )
)
100% 100% 100%
4% Development Co., Ltd. Development Co., Ltd. Development Co., Ltd.
Exalt Creation Limited (BVI) Hong Kong Flourishing Development Limited (HK) Zhangjiagang Dingsheng Real Estate Co., Ltd. 張家港鼎盛房地產有限公司 ( Changzhou Huisheng Real Estate 常州匯盛房地產發展有限公司 ( Changzhou Yuesheng Real Estate 常州悅盛房地產發展有限公司 ( Changzhou Zhuosheng Real Estate 常州卓盛房地產發展有限公司 (
Wuxi Future Land Wanbo )
) 96%
100% 100% 100% Business
(BVI) 有限公司
Heroic Time Global Limited Hong Kong Perpetual Development Limited (HK) Danyang Future Land Hongsheng Real Estate Development Co., Ltd. 丹陽新城宏盛房地產發展 ( ) 100% Management Co., Ltd. )
Business
Shanghai Qingpuwuyue 上海青浦吾悅商業管理有限公司 (
) 100% 100% 100%
)
100% 100% Future Land Wanbo 100% Management Co., Ltd.
Changzhou Future Land Wuyue Commercial Management Co., Ltd. 常州新城吾悅商業管理有限公司 ( Suzhou Future Land Wuyue 蘇州新城吾悅商業管理有限公司 (
Hong Kong Prosperity Development Co., Ltd. International Plaza
Development Limited (HK)
Public 26.61% Zhenjiang Kaisheng Real Estate 鎮江凱盛房地產發展有限公司 (
Changzhou Wuyue Commercial Management Co., Ltd. 常州吾悅國際廣場商業管理有限公司 (
1.07% 100% 93.78% 100% )
) )
memorandum. (2) 72.32% Company (Cayman) Hong Kong Achievement Development Limited (HK) 100% 90.91% 6.22% Changzhou Wealth Zone 97.7% Future Land Holdings Changzhou Future Land Keda 100% 100% Baihuo
Baihuo Co., Ltd.
offering “Connected Person” Management Co., Ltd. Investment Co., Ltd. Changzhou Future Land Hongye 常州新城宏業百貨有限公司 ( Changzhou Wuyue
the Directors and Officers Constituting Changzhou Derun Consulting 常州德潤諮詢管理有限公司 ( Changzhou Future Land Wande 常州新城萬德投資有限公司 ( )
of 100% 100% 68.78%
100%
)
date
Aceled Limited (BVI) Hong Kong Excellent 1.23%
Development Limited (HK)
theof 100% 100% 100% 上海新城萬聖置業有限公司 ( Wuhan Future Land Hongsheng
as Shanghai Future Land Wansheng Property Co., Ltd. 30%
Development Co., Ltd.
Suzhou Bosheng Real Estate
Infinity Fortune 100% 100% 蘇州博盛房地產發展有限公司 ( 0.91% 0.23%
Wealth Zone Hong Kong (BVI) )
First Priority Group Limited (BVI)
structure (1) Limited (BVI) Hong Kong Grand Wang Xiaosong
Flourish Source Holdings Development Limited (HK) ) 100%
36.62%
Hua Sheng Trust
Changzhou Jingdian Design Changzhou Fulong
corporate
100% 100% Development Co., Ltd. Changzhou Future Land Hongye Changzhou Future Land Wanbo Changzhou Future Land Wansheng Changsha Future Land Wanbo Changzhou Future Land Wansheng Business Management Co., Ltd. 常州新城萬盛商業管理有限公司 (
our Suzhou Kaituo Real Estate 蘇州凱拓房地產發展有限公司 (
Chairman Wang Limited (BVI) ) ) 100% 100% 100% 83.33% 100% 100%
Emerald Sea Holdings Hong Kong Exaltation
froth Development Limited (HK)
8.18% 2.07% 58.86%
(3)
sets
below 41.14% Jiangsu Future Land 54 PRC Subsidiaries
domestic shareholders
Chart Public B-share and
chart
16.67%
The
Corporate
----- End of picture text -----

Notes:

(1) Infinity Fortune is beneficially owned by Hua Sheng Trust, a discretionary trust set up by Chairman Wang, the founder of our Group as settlor and Standard Chartered Trust (Singapore) Limited as trustee in favor of his family members.
(2) Includes (a) 16,750,000 shares held by directors (excluding Mr. Wang Zhenhua) and officers of the Company constituting “connected persons” under the Listing Rules and (b) 44,100,000 shares held by Dynasty Snow (PTC) Ltd., the entire share capital of which is owned by Mr. Wang Xiaosong. Dynasty Snow (PTC) Ltd. holds the shares that will vest to such connected persons pursuant to the pre-IPO share award scheme. Mr. Wang Xiaosong also has an interest in 6,000,000 shares out of the 44,100,000 shares held by Dynasty Snow (PTC) Ltd., by virtue of his interest in the share award granted to him under the pre-IPO share award scheme.
(3) For details of the 54 PRC subsidiaries, see “Corporate Structure.”

– 9 –

THE OFFERING

Terms used in this summary and not otherwise defined shall have the meanings given to them in “Description of the Notes.”

Issuer . . . . . . . . . . . . . . . . . . . . . . . . . . Future Land Development Holdings Limited (the “ Company ”). Notes Offered . . . . . . . . . . . . . . . . . . . US$350,000,000 aggregate principal amount of 10.25% Senior Notes due 2019 (the “Notes”).
Offering Price . . . . . . . . . . . . . . . . . . . 99.046% of the principal amount of the Notes. Maturity Date . . . . . . . . . . . . . . . . . . . July 21, 2019. Interest . . . . . . . . . . . . . . . . . . . . . . . . The Notes will bear interest from and including July 21, 2014 at the rate of 10.25% per annum, payable semi-annually in arrears.
Interest Payment Dates . . . . . . . . . . . January 21 and July 21 of each year, commencing January 21, 2015. Ranking of the Notes . . . . . . . . . . . . . The Notes are: • general obligations of the Company; • senior in right of payment to any existing and future obligations of the Company expressly subordinated in right of payment to the Notes;
• at least pari passu in right of payment with the January 2018 Notes, the April 2016 Notes and all other unsecured, unsubordinated Indebtedness of the Company (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law);
• guaranteed by the Subsidiary Guarantors on a senior basis, subject to certain limitations described under the caption “Risk Factors – Risks Relating to the Guarantees and the Collateral” and “Description of the Notes – The Subsidiary Guarantees;”
• effectively subordinated to the other secured obligations (if any) of the Company, the Subsidiary Guarantors and the JV Subsidiary Guarantors, to the extent of the value of the assets serving as security therefor; and
• effectively subordinated to all existing and future obligations of the Non-Guarantor Subsidiaries.
After the pledge of the Collateral by the Company and the Subsidiary Guarantor Pledgors and subject to certain limitations described under “Risk Factors – Risks Relating to the Guarantees and the Collateral,” the Notes will: • be entitled to the benefit of a lien on the Collateral (subject to any Permitted Liens and the Intercreditor Agreement (as defined below) and shared on a pari passu basis with (i) holders of the January 2018 Notes, (ii) holders of the April 2016 Notes and (iii) any holders of Permitted Pari Passu Secured Indebtedness, if any); and

– 10 –

rank effectively senior in right of payment to unsecured obligations of the Company with respect to the value of the Collateral pledged by the Company securing the Notes (subject to any priority rights of such unsecured obligations pursuant to applicable law).

Subsidiary Guarantees . . . . . . . . . . . .

Each of the Subsidiary Guarantors will, jointly and severally, guarantee the due and punctual payment of the principal of, premium, if any, and interest on, and all other amounts payable under, the Notes.

The initial Subsidiary Guarantors will consist of all of the Restricted Subsidiaries other than those Restricted Subsidiaries organized under the laws of the PRC and certain other Restricted Subsidiaries as described under “Description of the Notes.”

The initial Subsidiary Guarantors are holding companies that do not have significant operations. See “Risk Factors – Risks Relating to the Guarantees and the Collateral – Our initial Subsidiary Guarantors do not currently have significant operations and certain Subsidiary Guarantees may in some cases be replaced by limited-recourse guarantees.”

Any future Restricted Subsidiary, as defined under “Description of the Notes – Definitions” (other than subsidiaries organized under the laws of the PRC), will guarantee the Notes as either a Subsidiary Guarantor or a JV Subsidiary Guarantor promptly upon becoming a Restricted Subsidiary. Notwithstanding the foregoing, the Company may elect to have any future Restricted Subsidiary organized outside the PRC not provide a Subsidiary Guarantee or a JV Subsidiary Guarantee at the time such entity becomes a Restricted Subsidiary, provided that, after giving effect to the Consolidated Assets of such Restricted Subsidiary, the Consolidated Assets of all Restricted Subsidiaries organized outside the PRC that are not Subsidiary Guarantors or JV Subsidiary Guarantors do not account for more than 15.0% of the Total Assets of the Company.

A Subsidiary Guarantee may be released or replaced in certain circumstances. See “Description of the Notes – The Subsidiary Guarantees – Release of the Subsidiary Guarantees and JV Subsidiary Guarantees.” In the case of a Subsidiary Guarantor with respect to which the Company or any Restricted Subsidiary is proposing to sell, whether through the sale of existing shares or the issuance of new shares, no less than 20.0% of the Capital Stock of such Subsidiary Guarantor, the Company may (i) release the Subsidiary Guarantees provided by such Subsidiary Guarantor and each of its Restricted Subsidiaries organized outside the PRC, (ii) discharge the pledge of the Capital Stock granted by such Subsidiary Guarantor, and (iii) discharge the pledge of Capital Stock made by the Company or any Subsidiary Guarantor over the shares it owns in such Subsidiary Guarantor, provided that after the release of such Subsidiary Guarantees, the Consolidated Assets of all Restricted Subsidiaries organized outside the PRC that are not Subsidiary Guarantors or JV Subsidiary Guarantors (including the Subsidiary Guarantors whose Subsidiary Guarantees were released) do not account for more than 15.0% of the Total Assets of the Company.

– 11 –

Ranking of Subsidiary Guarantees . .

The Subsidiary Guarantee of each Subsidiary Guarantor:

is a general obligation of such Subsidiary Guarantor;
is effectively subordinated to secured obligations of such Subsidiary Guarantor, to the extent of the value of the assets serving as security therefor;
is senior in right of payment to all future obligations of such Subsidiary Guarantor expressly subordinated in right of payment to such Subsidiary Guarantee; and
ranks at least pari passu with all other unsecured, unsubordinated Indebtedness of such Subsidiary Guarantor (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law).

After the pledge of the Collateral (as described below) by the Company and the Subsidiary Guarantor Pledgors, the Subsidiary Guarantees of each Subsidiary Guarantor Pledgor:

will be entitled to the benefit of a security interest in the Collateral pledged by such Subsidiary Guarantor Pledgor (subject to any Permitted Liens and the Intercreditor Agreement and shared on a pari passu basis with (i) holders of the January 2018 Notes, (ii) holders of the April 2016 Notes and (iii) any holders of Permitted Pari Passu Secured Indebtedness); and
• will rank effectively senior in right of payment to the unsecured obligations of such Subsidiary Guarantor Pledgor with respect to the value of the Collateral securing such Subsidiary Guarantee (subject to any priority rights of such unsecured obligations pursuant to applicable law).

See “Risk Factors – Risks Relating to the Guarantees and the Collateral.”

JV Subsidiary Guarantees . . . . . . . . .

In the case of a Restricted Subsidiary (i) that is established after the Original Issue Date, (ii) that is incorporated in any jurisdiction other than the PRC, (iii) that is not an Offshore Non-Guarantor Subsidiary and (iv) in respect of which the Company or any Restricted Subsidiary (x) is proposing to sell, whether through the sale of existing shares or the issuance of new shares, no less than 20.0% and no more than 49.9% of the Capital Stock of such Restricted Subsidiary or (y) is proposing to purchase no less than 50.1% and no more than 80.0% of the Capital Stock of such Restricted Subsidiary from an Independent Third Party (and concurrently become a Restricted Subsidiary), the Company may, subject to certain conditions, concurrently with the consummation of such sale or purchase, provide a JV Subsidiary Guarantee instead of a Subsidiary Guarantee for (a) such Restricted Subsidiary and (b) the Restricted Subsidiaries of such Restricted Subsidiary that are organized in any jurisdiction other than the PRC. See “Description of the Notes – The Subsidiary Guarantees – The JV Subsidiary Guarantees.”

– 12 –

Ranking of JV Subsidiary
Guarantees . . . . . . . . . . . . . . . . . . . .	The JV Subsidiary Guarantee of each JV Subsidiary Guarantor:
	• will be a general obligation of such JV Subsidiary Guarantor;
	• will be enforceable only up to the JV Entitlement Amount;
	• will be effectively subordinated to secured obligations of such
	JV Subsidiary Guarantor, to the extent of the value of the assets
	serving as security therefor;
	• will be limited to the JV Entitlement Amount, and will be senior
	in right of payment to all future obligations of such JV
	Subsidiary Guarantor expressly subordinated in right of payment
	of such JV Subsidiary Guarantee; and
	• will be limited to the JV Entitlement Amount, and will rank at
	least pari passu with all other unsecured, unsubordinated
	Indebtedness of such JV Subsidiary Guarantor (subject to any
	priority rights of such unsubordinated Indebtedness pursuant to
	applicable law).
Security to be Granted . . . . . . . . . . . .	The Company has agreed, for the benefit of the holders of the Notes,
	to pledge the Capital Stock of the Subsidiary Guarantors owned by the
	Company in order to secure the obligations of the Company under the
	Notes and the indenture governing the Notes (the “Indenture”).
	The Collateral securing the Notes and the Subsidiary Guarantees may
	be released or reduced in the event of certain asset sales and certain
	other circumstances. See “Description of the Notes – Security.”
Intercreditor Agreement . . . . . . . . . . .	On the Original Issue Date, the Trustee will execute a supplement to
	the Intercreditor Agreement and become a party to the Intercreditor
	Agreement, at which time the Trustee will become a Secured Party
	under the Intercreditor Agreement and the Holders will be entitled to
	the benefit of the pledge of the capital stock by the Subsidiary
	Guarantors on a pari passu basis with the holders of the January 2018
	Notes, the holders of the April 2016 Notes and the holders of any other
	Permitted Pari Passu Secured Indebtedness. See “Description of the
	Notes – Intercreditor Agreement.”
Use of Proceeds . . . . . . . . . . . . . . . . .	We estimate that the net proceeds from this offering, after deducting
	the underwriting discounts and commissions and other estimated
	expenses payable in connection with this offering, will be
	approximately US$341.6 million. We intend to use the net proceeds to
	repay certain of our existing indebtedness, fund the acquisition of land
	for residential and commercial property development and for general
	corporate purposes.
	Pending application of the net proceeds of this offering, we intend to
	invest such net proceeds in “Temporary Cash Investments” as defined
	under “Description of the Notes.”

– 13 –

			We may adjust our development plans in response to future events and
			developments, such as changes in general market conditions, the
			outlook for our industry and the demand for our properties, and our
			directors may reallocate the use of the proceeds with a view to
			obtaining the optimal benefit for us.
Optional	Redemption	. . . . . . . . . . . . .	At any time and from time to time on or after July 21, 2017, the
			Company may redeem the Notes, in whole or in part, at a redemption
			price equal to the percentage of principal amount set forth below, plus
			accrued and unpaid interest, if any, to (but excluding) the redemption
			date, if redeemed during the 12-month period commencing on July 21
			of any year set forth below:

	Period		Redemption Price

	2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		105.125%
	2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		102.5625%
	At any time prior to July 21, 2017, the Company		may at its option
	redeem the Notes, in whole but not in part, at a redemption price equal
	to 100% of the principal amount of the Notes plus the Applicable
	Premium (as defined herein) as of, and accrued and		unpaid interest, if
	any, to (but not including) the redemption date.
	At any time and from time to time prior to July 21, 2017, the Company
	may redeem up to 35% of the aggregate principal amount of the Notes
	at a redemption price of 110.25% of the principal amount of the Notes,
	plus accrued and unpaid interest, if any, to (but not including) the
	redemption date, with the proceeds from sales of	certain kinds of its
	capital stock, subject to certain conditions.
Repurchase of Notes Upon a Change
of Control Triggering Event . . . . . .	Upon the occurrence of a Change of Control Triggering Event, the
	Company will make an offer to repurchase all outstanding Notes at a
	purchase price equal to 101% of the principal amount of the Notes,
	plus accrued and unpaid interest, if any, to (but not including) the
	repurchase date.
Redemption for Taxation Reasons . . .	Subject to certain exceptions and as more fully described herein, the
	Company may redeem the Notes, as a whole but		not in part, at a
	redemption price equal to 100% of the principal amount thereof,
	together with accrued and unpaid interest (including any Additional
	Amounts), if any, to the date fixed by the Company		for redemption, if
	the Company would become obligated to pay certain additional
	amounts as a result of certain changes in specified tax laws or certain
	other circumstances. See “Description of the Notes		– Redemption for
	Taxation Reasons.”
Covenants . . . . . . . . . . . . . . . . . . . . . .	The Notes, the Indenture and the Subsidiary Guarantees will limit the
	Company’s ability and the ability of its Restricted Subsidiaries to,
	among other things:
	• incur or guarantee additional indebtedness and issue disqualified
	or preferred stock;
	• declare dividends on its capital stock or purchase or redeem
	capital stock;

– 14 –

		• make investments or other specified restricted payments;
		• enter into agreements that restrict the Restricted Subsidiaries’
		ability to pay dividends, transfer assets or make intercompany
		loans;
		• issue or sell capital stock of Restricted Subsidiaries;
		• guarantee indebtedness of Restricted Subsidiaries;
		• enter into transactions with shareholders or affiliates;
		• create liens;
		• enter into sale and leaseback transactions;
		• sell assets; and
		• effect a consolidation or merger.
		These covenants are subject to a number of important qualifications
		and exceptions described in “Description of the Notes – Certain
		Covenants.”
Transfer Restrictions	. . . . . . . . . . . . .	The Notes will not be registered under the U.S. Securities Act or under
		any state securities laws of the United States and will be subject to
		customary restrictions on transfer and resale. See “Transfer
		Restrictions.”
Form, Denomination and
Registration . . . . . . . . . . . . . . . . . . .		The Notes will be issued in fully registered form without interest
		coupons. The Notes will be issued in minimum denominations of
		US$200,000 and integral multiples of US$1,000 in excess thereof and
		will be deposited with a common depositary and registered in the name
		of the common depositary or its nominee for the accounts of Euroclear
		and Clearstream.
Book-Entry . . . . . . . . . . . . . . . . . . . . .		The Notes will be issued in book-entry form through the facilities of
		Euroclear and Clearstream. For a description of certain factors relating
		to clearance and settlement, see “Description of the Notes – Book-
		Entry; Delivery and Form.”
Delivery of the Notes . . . . . . . . . . . . .		The Company expects to make delivery of the Notes, against payment
		in same-day funds on or about July 21, 2014 which the Company
		expects will be the fifth business day following the date of this
		offering memorandum referred to as “T+5”. You should note that
		initial trading of the Notes may be affected by the T+5 settlement. See
		“Plan of Distribution.”
Trustee and Paying Agent . . . . . . . . . .		The Bank of New York Mellon, London Branch
Registrar and Transfer Agent . . . . . . .		The Bank of New York Mellon (Luxembourg) S.A.
Collateral Agent . . . . . . . . . . . . . . . . .		The Bank of New York Mellon

– 15 –

Listings . . . . . . . . . . . . . . . . . . . . . . . . Approval in-principle has been received for the listing and quotation of the Notes on the SGX-ST. The Notes will be traded in a minimum board lot size of US$200,000 for so long as the Notes are listed on the SGX-ST and the rules of the SGX-ST so require. Governing Law . . . . . . . . . . . . . . . . . . The Notes and the Indenture will be governed by and will be construed in accordance with the laws of the State of New York. The relevant pledge documents will be governed under the laws of the jurisdiction in which the relevant Subsidiary Guarantor is incorporated. Risk Factors . . . . . . . . . . . . . . . . . . . . For a discussion of certain factors that should be considered in evaluating an investment in the Notes, see “Risk Factors.” Ratings . . . . . . . . . . . . . . . . . . . . . . . . The Notes are expected to be rated B+ by Standard and Poor’s Rating Services (“ S&P ”) and B1 by Moody’s Investors Service, Inc. (“ Moody’s ”). We cannot assure investors that these ratings will not be adversely revised or withdrawn either before or after delivery of the Notes. Security Codes . . . . . . . . . . . . . . . ISIN Common Code XS1086808570 108680857

– 16 –

SUMMARY HISTORICAL FINANCIAL AND OTHER DATA

The following tables set forth our summary financial and other data. The summary consolidated statements of income data for the years ended December 31, 2011, 2012 and 2013 and the summary consolidated statements of financial position data as of December 31, 2011, 2012 and 2013 set forth below (except for EBITDA data and amounts presented in U.S. dollars) have been derived from the accountant’s report as set out in the prospectus dated November 19, 2012 relating to our IPO (the “ Accountant’s Report ”) and our consolidated financial statements as of and for the years ended December 31, 2012 and 2013 as audited by PricewaterhouseCoopers, Certified Public Accountants, Hong Kong.

The financial information included in the Accountant’s Report and our consolidated financial statements as of and for the years ended December 31, 2012 and 2013 have been prepared and presented in accordance with HKFRSs, which differ in certain respects from generally accepted accounting principles in other jurisdictions. You should read the summary financial data below in conjunction with the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the Accountant’s Report, our audited consolidated financial statements and the notes to those statements. Historical results are not necessarily indicative of future results.

Summary Consolidated Statements of Income and Other Financial Data

		Year ended December 31,	Year ended December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)	(US$)
				(unaudited)
		(in thousands)
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10,767,254	17,517,266	20,771,255	3,431,167
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(7,743,687)	(13,587,371)	(16,088,038)	(2,657,555)

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,023,567	3,929,895	4,683,217	773,612
Fair value gains on investment properties . . . . .	273,493	31,086	37,839	6,251
Selling and marketing costs. . . . . . . . . . . . . . . . .	(388,091)	(474,921)	(592,032)	(97,797)
Administrative expenses. . . . . . . . . . . . . . . . . . . .	(465,941)	(569,883)	(680,028)	(112,333)
Other income. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	39,493	9,475	151,674	25,055
Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . .	(20,240)	(4,347)	(4,152)	(686)
Other gains – net . . . . . . . . . . . . . . . . . . . . . . . . .	58,076	13,626	46,270	7,643
Operating profit . . . . . . . . . . . . . . . . . . . . . . . . .	2,520,357	2,934,931	3,642,788	601,746
Finance costs – net. . . . . . . . . . . . . . . . . . . . . . . .	(135,142)	(111,660)	(394,900)	(65,233)
Share of results of an associated company. . . . .	−	(5,110)	(11,422)	(1,887)
Profit before income tax . . . . . . . . . . . . . . . . . .	2,385,215	2,818,161	3,236,466	534,626
Income tax expense . . . . . . . . . . . . . . . . . . . . . . .	(941,284)	(1,232,777)	(1,519,329)	(250,975)
Profit for the year. . . . . . . . . . . . . . . . . . . . . . . .	1,443,931	1,585,384	1,717,137	283,651

Attribute to:
Equity holders of the Company. . . . . . . . . . . . . .	886,886	930,819	981,262	162,093
Non-controlling interests . . . . . . . . . . . . . . . . . . .	557,045	654,565	735,875	121,558

Other Financial Data (unaudited)
EBITDA(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2,605,018	3,638,945	4,339,993	716,916

EBITDA margin(2) . . . . . . . . . . . . . . . . . . . . . . . .	24.2%	20.8%	20.9%

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(1) EBITDA refers to our operating profit plus depreciation, amortization and capitalized interest under cost of sales, but excluding fair value gains on the investment properties and net gains or losses. EBITDA is not a standard measure under HKFRSs. EBITDA is a widely used financial indicator of a company’s ability to service and incur debt. EBITDA should not be considered in isolation or construed as an alternative to cash flows, net income or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. EBITDA does not account for taxes, interest expense or other non-operating items. In evaluating EBITDA, we believe that investors should consider, among other things, the components of EBITDA such as sales and operating expenses and the amount by which EBITDA exceeds capital expenditures and other charges. We have included EBITDA because we believe it is a useful supplement to cash flow data as a measure of our performance and our ability to generate cash flow from operations to cover debt service and taxes. EBITDA presented herein may not be comparable to similarly titled measures presented by other companies. Investors should not compare our EBITDA to EBITDA presented by other companies because not all companies use the same definition. See the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures” for a reconciliation of our profit for the year under HKFRSs to our definition of EBITDA. Investors should also note that EBITDA as presented herein may be calculated differently from Consolidated EBITDA as defined and used in the Indenture. See the section headed “Description of the Notes – Definitions” for a description of the manner in which Consolidated EBITDA is defined for purposes of the Indenture.
(2) EBITDA margin is calculated by dividing EBITDA by revenue.

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Summary Consolidated Statements of Financial Position Data

		As of December 31,	As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)	(US$)
				(unaudited)
		(in thousands)
ASSETS
Non-current assets
Property, plant and equipment . . . . . . . . . . . . . . .	117,016	117,074	116,009	19,163
Investment properties . . . . . . . . . . . . . . . . . . . . . .	2,443,200	3,105,600	3,307,000	546,277
Intangible assets. . . . . . . . . . . . . . . . . . . . . . . . . . .	5,341	7,267	9,836	1,625
Investments in associates . . . . . . . . . . . . . . . . . . .	235,000	229,890	43,468	7,180
Investment in a joint venture . . . . . . . . . . . . . . . .	−	−	10,000	1,652
Deferred income tax assets . . . . . . . . . . . . . . . . . .	362,640	361,193	499,738	82,551
Available-for-sale financial assets . . . . . . . . . . . .	156,000	181,187	221,187	36,537
Land use rights . . . . . . . . . . . . . . . . . . . . . . . . . . .	367,248	367,248	367,248	60,665
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . .	−	−	198,538	32,796

	3,686,445	4,369,459	4,773,024	788,447

Current assets
Prepayments for leasehold land . . . . . . . . . . . . . .	2,689,155	4,313,847	3,285,498	542,726
Properties held or under development for sale . .	24,227,066	24,493,752	28,728,964	4,745,687
Trade and other receivables and prepayments. . .	1,761,606	1,666,266	2,112,831	349,015
Restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . .	314,536	1,148,089	886,180	146,387
Cash and cash equivalents . . . . . . . . . . . . . . . . . .	4,221,558	4,852,130	7,411,713	1,224,328
	33,213,921	36,474,084	42,425,186	7,008,141

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	36,900,366	40,843,543	47,198,210	7,796,589

OWNERS’ EQUITY
Capital and reserves attributable to equity
holders of the Company
Issued and fully paid capital. . . . . . . . . . . . . . . . .	3,466	4,617	4,617	763
Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,176,350	5,746,486	6,717,031	1,109,574

	3,179,816	5,751,103	6,721,648	1,110,337
Non-controlling interests . . . . . . . . . . . . . . . . . . . .	2,022,133	2,643,924	3,876,311	640,321
Total equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5,201,949	8,395,027	10,597,959	1,750,658
LIABILITIES
Non-current liabilities
Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6,649,200	4,509,670	11,715,075	1,935,193
Deferred income tax liabilities . . . . . . . . . . . . . . .	343,237	402,872	432,922	71,514

Current liabilities
Trade and other payables . . . . . . . . . . . . . . . . . . .	6,627,089	9,597,029	10,368,476	1,712,750
Advances from pre-sale of properties . . . . . . . . .	12,775,020	11,663,869	10,235,042	1,690,708
Current income tax liabilities . . . . . . . . . . . . . . . .	1,085,703	1,143,835	1,673,306	276,410
Borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4,217,363	5,130,436	2,174,501	359,202
Dividends payable . . . . . . . . . . . . . . . . . . . . . . . . .	805	805	929	153
	24,705,980	27,535,974	24,452,254	4,039,225

Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31,698,417	32,448,516	36,600,251	6,045,931

Total equity and liabilities. . . . . . . . . . . . . . . . . . .	36,900,366	40,843,543	47,198,210	7,796,589

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RISK FACTORS

You should carefully consider the risks and uncertainties described below and all other information contained in this offering memorandum before making an investment decision. The risks and uncertainties described below may not be the only ones that we face. Additional risks and uncertainties that we are not aware of or that we currently believe are immaterial may also adversely affect our business, financial condition, results of operations or the market price of the Notes. If any of the possible events described below actually occurs, our business, financial condition or results of operations could be materially and adversely affected. In such case, we may not be able to satisfy our obligations under the Notes, and you could lose all or part of your investment.

We believe that there are certain risks and uncertainties involved in our operations, some of which are beyond our control. We have categorized these risks and uncertainties into: (i) risks relating to our business; (ii) risks relating of our industry; (iii) risks relating to doing business in the PRC; (iv) risks relating to the Notes; and (v) risks relating to the Guarantees and the Collateral.

Risks Relating to Our Business

Our operations are subject to extensive government policies and regulations and, in particular, we are susceptible to changes in policies affecting the PRC property industry and the regions in which we operate.

Our business is subject to extensive governmental regulations and, in particular, we are susceptible to policy changes in the PRC property industry. In particular, the PRC government exerts considerable direct and indirect influence on the development of the PRC property industry by imposing industry policies and other economic measures, such as control over the supply of land for property development, property financing, taxation and foreign investment. Through these policies and measures, the PRC government may restrict or reduce land available for property development, raise the benchmark interest rates of commercial banks, place additional limitations on the ability of commercial banks to make loans to property developers and property purchasers, impose additional taxes and levies on property sales and restrict foreign investment in the PRC property industry.

In recent years, the PRC government has implemented a series of regulations and policies to control the growth of the property market and discourage property speculation. These policies may limit our ability to obtain financing, acquire land for future developments, sell properties or generate sufficient cash flows from property sales. As a result of the various measures implemented by the PRC government since January 2011, the transaction volumes for properties in most cities in which we operate experienced significant declines between September 2011 and January 2012. Average selling prices for property sales also decreased between September 2011 and January 2012, but to varying degrees in different cities, as property developers began launching a wide range of promotional initiatives to stimulate demand for properties.

Although the transaction volumes and average selling prices experienced a slight increase in late 2012 and 2013, we cannot assure you that the PRC government will not adopt more stringent industry policies and measures in the future. It is difficult to predict the impact these policies and measures may have on our sales volume and revenue. If we fail to adapt our operations to new policies or measures that may come into effect from time to time, or if our marketing and pricing strategies are not effective, our contracted sales and selling prices may decline, or we may incur additional costs, in which case our operating cash flows, gross profit margin, business prospects, results of operations and financial condition may be materially adversely affected.

Our business and prospects are heavily dependent on the performance of the PRC property markets, particularly in various major cities in Jiangsu Province and Shanghai.

We principally develop and sell properties in cities along the Shanghai-Nanjing Economic Corridor in the Yangtze River Delta. As of December 31, 2013, we had 93 property projects completed or in various stages of development. Our business continues to be heavily dependent on the property markets in Jiangsu Province and Shanghai. These property markets may be affected by factors in local, regional, national and global markets, including prevailing economic conditions, speculative activities in local markets, demand and supply dynamics in the property market, availability of alternative investment choices for property buyers, inflation, government policies, interest rates and availability of capital.

In addition, any decline in demand or prices for properties in the cities where we have operations could have a material adverse impact on our cash flows, financial position and results of operations. In particular, property prices and demand for properties in Jiangsu Province and Shanghai have fluctuated significantly in

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recent years. Further policies implemented by the PRC government on bank loans and trust financing arrangements for real estate development projects since January 2010 have had, and may continue to have, a dampening effect on the property markets in which we operate.

A default under any of our lending or financing agreements could result in enforcement against the security we have granted, which could materially adversely affect our ownership in the B-Share Group and hence our ability to continue our operations.

We have maintained a significant level of indebtedness, a portion of which is secured by pledges of shares we hold in Jiangsu Future Land, our listed subsidiary through which, together with the project companies held by it (together, the “ B-Share Group ”), we carry out a substantial part of our business, and our other subsidiaries. Our total current and non-current borrowings, which include our borrowings from banks and trust financing arrangements were RMB10,866.6 million, RMB9,640.1 million and RMB11,222.5 million (US$1,853.8 million) as of December 31, 2011, 2012 and 2013, respectively. Our total debt-to-asset ratio was 29.4%, 23.6% and 29.4%, and our net debt-to-equity ratio was 127.7%, 57.0% and 61.1% as of December 31, 2011, 2012 and 2013, respectively.

We cannot assure you that we will be able to generate sufficient cash flow from operations to meet our payment obligations under our current outstanding debt. If we were unable to make scheduled payments in connection with our debt and other payment obligations as they become due, we may need to renegotiate the terms and conditions of such obligations or to obtain additional equity or debt financing, failing which we may default on such repayment (or other) obligations. In the event of a default, our lenders can enforce their rights against us, including enforcing their rights against the pledged shares in our subsidiaries and project companies under the relevant financing agreements.

We may again enter into trust financing arrangements in the future secure such loans with the share capital of Jiangsu Future Land or other subsidiaries. Should we default on any of our obligations under such loans, creditors can enforce its rights against the pledged shares, and we may, as a result, lose control and ownership of Jiangsu Future Land or such other subsidiaries. Although our obligations under trust financing arrangements have been discharged, we cannot assure you that we will not enter into similar financing agreements again in the future.

We cannot assure you that we will be able to continue meeting all of our obligations under the bank loans and future trust financing arrangements. We also cannot assure you that the equity interests that may be pledged to our lenders or trust financing companies will not be subject to enforcement actions, in which case we may lose control and ownership of a number of our subsidiaries and our results of operations and financial condition may be materially adversely affected.

We are subject to risks associated with certain covenants or restrictions under our bank borrowings which may adversely affect our business, financial condition and results of operations.

We are subject to certain restrictive covenants in the loan contracts between us and certain banks. Our loan agreements with each of Construction Bank of China, China Minsheng Banking Corp. Ltd., Agricultural Bank of China, Industrial and Commercial Bank of China Limited, Bank of Communications, Bank of China, Huaxia Bank and Xiamen International Bank contain cross-default clauses. If any cross-default occurs, such banks will be entitled to accelerate repayment of all or any part of the loans from such banks and to take action against all or any of the security for such indebtedness. In addition, some of our PRC operating subsidiaries are subject to certain material covenants that restrict them from carrying out any merger, restructuring, spin-off, reduction of registered share capital, material asset transfer, liquidation, change in shareholding or management structure, establishment of any joint venture, or substantive increase of debt financing without the lenders’ written

1 We have RMB125.0 million on deposit with Jiangsu International Trust Corporation Limited which can be used to set off the outstanding amount of such trust loans.

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consent. Furthermore, as long as such loans are outstanding, some of our relevant operating subsidiaries may not be able to provide guarantees to any third parties that would impair their ability to repay the relevant loans. We cannot assure you that we will be able to abide by all restrictive covenants and cross-default provisions of any of our loan contracts in the future. Should we fail to abide by these provisions, our lenders may be entitled to accelerate repayment of our loans, in which case our business, financial condition and results of operations will be adversely affected.

We had negative net operating cash flow for the years ended December 31, 2011 and 2013. If we are unable to meet our payment obligations, our business, financial condition and results of operations may be materially adversely affected.

For the years ended December 31, 2011 and 2013, we recorded negative net operating cash flow of approximately RMB950.6 million and RMB3,267.8 million, respectively. Our negative net operating cash flow was principally attributable to the long-term and capital-intensive nature of property development, our land acquisitions and business expansion during the relevant years. We fund our capital expenditures with internally generated funds and external financing. Negative net operating cash flow would require us to obtain sufficient external financing to meet our financial needs and obligations. If we are unable to do so, we will be in default of our payment obligations and may not be able to develop our projects as planned. As a result, our business, financial condition and results of operations may be materially adversely affected.

We may not have adequate financing to fund our future land acquisitions and property developments, and such capital resources may not be available on commercially reasonable terms, or at all.

Property development is capital-intensive, and we expect to continue to incur significant capital expenditures for construction and land acquisition. We finance our property projects primarily through a combination of internally generated funds, including proceeds from pre-sales and sales of our properties, and external financing, such as borrowings from financial institutions comprising China Banking Regulatory Commission (the “ CBRC ”) licensed commercial banks and trust financing companies. Our ability to obtain external financing in the future and the cost of such financing are subject to uncertainties, some of which are beyond our control, including:

requirements to obtain PRC government approvals necessary for obtaining financing in the domestic or international markets;
our future results of operations, financial condition and cash flows;
the condition of the international and domestic financial markets and financing availability thereof;
changes in the monetary policies of the PRC government with respect to bank interest rates and lending practices; and
changes in policies regarding regulation and control of the real estate market.

The PRC government has implemented a number of measures to manage money supply growth and credit availability, especially with respect to the property development sector. For example:

the People’s Bank of China (the “ PBOC ”) has adjusted the Renminbi deposit reserve ratio several times since 2010;
the PBOC has adjusted the benchmark one-year bank lending rate many times since 2008;
commercial banks may not grant loans to property developers to pay land premiums;
the CBRC has issued guidelines that require at least 30% of the total investment in a property project to be funded by the developer’s own capital; and
the CBRC issued rules governing the establishment, operation and financing activities of trust financing companies in 2007, which are designed to limit the availability of trust financing to property developers.

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The above measures and other similar government actions and policy initiatives have limited our ability and flexibility in incurring additional indebtedness to finance our property projects. We cannot assure you that the PRC government will not introduce other initiatives that may further limit our access to capital, or that we will be able to secure adequate financing or renew our existing credit facilities on commercially reasonable terms, or at all.

Our financing costs are subject to changes in interest rates.

We have incurred and expect to continue to incur a significant interest expenses relating to our borrowings. Accordingly, changes in interest rates have affected and will continue to affect our financing costs. Because the majority of our borrowings are in Renminbi, the interest rates on our borrowings are primarily affected by the benchmark interest rates set by the PBOC, which have fluctuated significantly in recent years. As of December 31, 2011, 2012 and 2013, the weighted average effective interest rate on our bank borrowings was 6.69%, 6.76% and 6.85%, respectively, and the weighted average cost of borrowing of our trust financing arrangements was 13.28% and 13.50% as of December 31, 2011 and 2012, respectively. We did not have any borrowings under trust financing arrangement as of December 31, 2013. Our interest costs incurred in the years ended December 31, 2011, 2012 and 2013 were RMB1,026.0 million, RMB1,015.7 million and RMB1,209.8 million, respectively. Future increases in the PBOC benchmark interest rate may lead to higher lending rates, which may increase our financing costs and thereby adversely affect our business, financial condition and results of operations.

We may not be able to acquire land reserves in desirable locations that are suitable for development at commercially acceptable prices in the future.

The growth and success of our business depend on our ability to continue to acquire land reserves in desirable locations that are suitable for our projects at commercially reasonable prices. Our ability to acquire land may depend on a variety of factors, such as overall economic conditions, our effectiveness in identifying and acquiring land parcels suitable for development and competition for such land parcels. Our land reserves were primarily acquired in land auctions held by local governments and through the acquisition of property development companies or property development rights from other developers. The availability and price of land sold at auctions depend on factors beyond our control, including government land policies and competition. The PRC government and relevant local authorities control the supply and price of new land parcels and approve the planning and use of such land parcels. Furthermore, the rapid development of the cities in Jiangsu Province and Shanghai in recent years has resulted in a shortage in the supply of undeveloped land in desirable locations and increased land acquisition costs, which is one of the largest components of our cost of sales.

We may not successfully manage our growth and expansion.

In recent years, we have diversified our product portfolio by expanding into the development of mixed-use complex projects. For instance, we began developing Wanbo Fashion Mall in Changzhou, Jiangsu Province in 2008 and are currently developing three other mixed-use complex projects. In addition to growing our presence in Changzhou, Shanghai, Nanjing, Wuxi and Suzhou, we have been expanding our geographic coverage to Zhenjiang and Nantong in Jiangsu Province, Changsha in Hunan Province, Hangzhou in Zhejiang Province and Wuhan in Hubei Province. We are also expanding into the development and operation of hotels and offices and engaging in commercial leasing. We intend to continue to diversify our business.

Expanding into new business segments and geographical locations involves uncertainties and challenges due to our unfamiliarity with new business segments or local regulatory practices and customs, customer preferences and behavior, the reliability of local contractors and suppliers, business practices, business environments and municipal-planning policies. In addition, expanding our business into new geographical locations would entail competition with developers who have a stronger local presence, greater familiarity with local regulatory and business practices and customs, and stronger ties with local suppliers, contractors and purchasers.

As we may face challenges not previously encountered, we may fail to recognize or properly assess risks or take full advantage of opportunities, or otherwise fail to adequately leverage our past experience to meet challenges encountered in these new activities. We may also have difficulty in promoting and maintaining high occupancy rates and/or rental rates in the investment properties that we are currently developing after these properties are completed and commence operations.

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Expanding our business requires significant capital and management resources. We will also need to increase our workforce to match the expansion of our business. We may also face considerable reputational and financial risks if any new sector of our business is mismanaged or does not meet the expectations of our customers. Any of these factors could have a material adverse effect on our business, financial condition, results of operations and prospects.

Our business may be adversely affected if we fail to obtain, or experience material delays in obtaining, necessary government approvals in carrying out our property development and management operations.

The property industry in the PRC is heavily regulated. Property developers must abide by various laws and regulations, including rules stipulated by national and local governments to enforce these laws and regulations. To engage in property development and management operations, we must satisfy certain requirements to obtain (and renew for those relating to on-going operations) various licenses, permits, certificates and approvals, including but not limited to, qualification certificates, land use rights certificates, construction work commencement permits, construction work planning permits, construction land planning permits, pre-sale permits and completion certificates.

We cannot guarantee that we will be able to adapt to new rules and regulations that may come into effect from time to time with respect to the property industry or that we will not encounter other material delays or difficulties in fulfilling the necessary conditions to obtain and/or renew all necessary certificates or permits for our operations in a timely manner, or at all. Therefore, in the event that we fail to obtain or renew, or encounter significant delays in obtaining or renewing, the necessary government approvals for any of our major property projects, we will not be able to continue with our development plans, and our business, financial condition and results of operations may be adversely affected.

Our results of operations may vary significantly from period to period as we derive our revenue principally from the sale of properties.

We derive the majority of our revenue from the sale of properties that we have developed. Our results of operations may fluctuate in the future due to a combination of factors, including the overall schedule of our property development projects, the level of acceptance of our properties by prospective customers, the timing of the sale of properties that we have developed, our revenue recognition policies and any changes in costs and in expenses, such as land acquisition and construction costs. In addition, our property developments are often developed in multiple phases over the course of several years. Typically, as the overall development approaches completion, the sale prices of the properties in such developments tend to increase because a more marketable property is available to purchasers. Furthermore, according to our accounting policy for revenue recognition, we recognize revenue from the sale and pre-sale of our properties upon delivery to purchasers. Generally, there is a timing difference, typically ranging from one year to one and a half years, between the time we commence pre-sale of properties under development and completion of properties. Because the timing of completion of our properties varies according to our construction timetable, our results of operations may vary significantly from period to period depending on the GFA sold or pre-sold and the timing of completion of the properties we sell. Periods in which we pre-sell a large amount of aggregate GFA, however, may not be periods in which we generate a correspondingly high level of revenue, if the properties pre-sold are not completed and delivered within the same period. The effect of timing of delivery on our operational results is accentuated by the fact that during any particular period of time we can only undertake a limited number of projects due to our substantial capital requirements for land acquisition and construction costs as well as the limited supply of land.

Accordingly, our interim results for a certain period may not be indicative of our performance for that financial year or otherwise comparable to our results in previous periods. In light of the above, period-to-period comparisons of our operating results may not be as meaningful as they would be for a company with a greater proportion of recurring revenues.

We rely on third-party contractors to develop our projects.

We engage third-party contractors to carry out various services relating to our property development projects, including design, foundation building, construction, equipment installation, engineering and landscaping. We generally select third-party contractors through a tender process based on their reputation and track record, reliability and financial strength. If the performance of any third-party contractor is not satisfactory, we may need to replace such contractor or take other remedial actions, which could adversely affect the cost structure and development schedule of our projects and could have a negative impact on our reputation, credibility, financial position and business operations. In addition, as we are expanding our business into new geographical locations in the PRC, we may have difficulty hiring contractors that meet our quality standards.

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We may engage third-party contractors or management companies to manage the daily operations of our hotels and offices. If the performance of our third-party contractors or management companies is not satisfactory to our customers, our investment properties may experience lower occupancy rates, which would lead to a loss of income or have an adverse impact on our reputation. If we were unable to successfully manage our investment properties, our business, financial condition, results of operations and prospects could be materially adversely affected.

We may not be able to complete our development projects on time, or at all.

Property development projects require substantial capital expenditures prior to and during the construction period for, among other things, land acquisition and construction. The construction of property projects may take over a year or longer before they generate positive net cash flow through sales, pre-sales, leasing or rentals. Depending on the type of investment properties and the revenue generated, it may take a year or more after the completion of these properties before we recognize revenue from such projects. As a result, our cash flows and results of operations may be significantly affected by our project development schedules and any changes to those schedules. The schedules of our project developments depend on a number of factors, including the performance and efficiency of our third-party contractors and our ability to finance construction. Other factors that could adversely affect our project development schedules include:

natural catastrophes and adverse weather conditions;
changes in market conditions, economic downturns, and decreases in business and consumer sentiment in general;
changes in relevant regulations and government policies;
relocation of existing residents and/or demolition of existing constructions;
shortages of materials, equipment, contractors and skilled labor;
labor disputes;
construction accidents; and
errors in judgment on the selection and acquisition criteria for potential sites.

Construction delays or failure to complete the construction of a project according to its planned specifications, schedule and budget may harm our reputation as a property developer, lead to loss of or delay in recognizing revenues and lower returns. If a property project is not completed on time, the purchasers of pre-sold units within the project may be entitled to compensation for late delivery. If the delay extends beyond a certain period, the purchasers may be entitled to terminate their pre-sale agreements and claim damages. We cannot assure you that we will not experience any significant delays in completing or delivering our projects in the future or that we will not be subject to any liabilities for any such delays.

We may forfeit land to the PRC government if we fail to develop properties in accordance with the terms and timeframe set out in the land grant contracts.

Under PRC law, if we fail to develop a property project according to the terms of the land grant contract, including those relating to the payment of land grant premium, demolition and resettlement costs and other fees, the designated use of the land and the time for commencement and completion of the property development, the PRC government may issue a warning, impose a penalty, and order us to forfeit the land. Specifically, under current PRC laws, if we fail to commence development for more than one year but less than two years from the commencement date stipulated in the land grant contract, the relevant PRC land bureau may issue a warning to us and impose an idle land fee on the land of up to 20% of the land grant premium. The relevant PRC land bureau also may confiscate our land use rights without compensation if we fail to commence development within two years from the construction commencement date set forth in the land grant contract, unless the delay in the development is caused by government actions or force majeure. Moreover, if a property developer commences development of the land in accordance with the timeframe stipulated in the land grant contract and the developed GFA on the land is less than one-third of the total proposed GFA of the project or the total invested capital is less than one-fourth of the total investment of the project and the development of the land is suspended for more than one year without government approval, the land may be treated as idle land and subject to risk of forfeiture.

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In September 2007, the Ministry of Land and Resources issued a notice to strengthen control over the supply of land by requiring developers to develop land according to the terms of the land grant contracts and restricting the participation of non-compliant developers in land auctions. In January 2008, the State Council issued the Notice on Promoting the Land Saving and Efficient Use (關於促進節約集約用地的通知) to intensify the enforcement of rules on idle land management. Furthermore, the Ministry of Land and Resources issued the Notice on Restricting the Administration of Construction Land and Promoting the Use of Approved Land (關於嚴格建設用地管理促進批而未用土地利用的通知) in August 2009, which reiterated then existing rules on idle land management. On June 1, 2012, the Ministry of Land and Resources promulgated the revised Measures on the Disposal of Idle Land (閒置土地處置辦法), which became effective on July 1, 2012.

These measures require the competent land authorities not to accept any application for new land use rights or process any title transfer transaction, lease transaction, mortgage transaction or land registration application in respect of any idle land before the completion of the required rectification procedures. Our business operations are subject to these measures, which may restrict our development plans and materially and adversely affect our results of operations, prospects and financial condition.

The illiquidity of property investments and the lack of alternative use for investment properties could limit our ability to respond to adverse changes in the performance of our properties.

We had investments or held interests in approximately 9.64 million sq.m. of investment properties as of December 31, 2013. We expect to increase our investment property portfolio in the future. Any form of real estate investment is illiquid and, as a result, our ability to sell our investment properties in response to changing economic, financial and investment conditions is limited. We also cannot predict the length of time needed to find purchasers to purchase such investment properties. In addition, we may also need to incur capital expenditure to manage and maintain our properties, or to correct defects or make improvements to these properties before selling them. We cannot assure you that financing for such expenditures would be available when needed, or at all.

Furthermore, aging of investment properties, changes in economic and financial condition or changes in the competitive landscape in the PRC property market may adversely affect the amount of rentals and revenue we generate from, as well as the fair value of, our investment properties. However, our ability to convert any of our investment properties to alternative use is limited as such conversion requires extensive governmental approvals in the PRC and involves substantial capital expenditures for the purpose of renovation, reconfiguration and refurbishment. We cannot assure you that such approvals and financing can be obtained when needed. These and other factors that impact our ability to respond to adverse changes in the performance of our investment in properties may adversely affect our business, financial condition and results of operations.

The relevant PRC tax authorities may challenge the basis on which we calculate our LAT obligations.

In accordance with PRC regulations on LAT, companies that receive income from the sale or transfer of land use rights, buildings and their attached facilities are subject to LAT at progressive rates ranging from 30% to 60% of the appreciated value of the property.

We make provisions for the full amount of applicable LAT in accordance with the relevant PRC tax laws and regulations from time to time pending settlement of the same with the relevant tax authorities. As we often develop our projects in phases, deductible items for calculation of LAT, such as land costs, are apportioned among such different phases of development. Provisions for LAT are made on our own estimates based on, among others, our own apportionment of deductible expenses which is subject to final confirmation by the relevant tax authorities upon settlement of the LAT. We believe that our overall provisions for LAT are sufficient. However, given the time gap between the point at which we make provision for and the point at which we settle the full amount of LAT payable, the relevant tax authorities may not necessarily agree with our apportionment of deductible expenses or other bases on which we calculate LAT. Hence, our LAT expenses as recorded in our financial statements of a particular period may require subsequent adjustments. For the years ended December 31, 2011, 2012 and 2013, we recorded approximately RMB388.2 million, RMB636.2 million and RMB866.6 million respectively, as LAT expenses. If we substantially underestimated LAT for a particular period, a payment of the actual LAT assessed and levied on us by the tax authorities could adversely affect our financial results for a subsequent period.

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The property development business is subject to claims under statutory quality warranties.

All property developers in the PRC must provide certain quality warranties for the properties they construct or sell. We are required to provide these warranties to our customers. Generally, we receive quality warranties from our third-party contractors with respect to our property projects. If a significant number of claims were brought against us under our warranties and if we were unable to obtain reimbursement for such claims from third-party contractors in a timely manner or at all, or if the money retained by us to cover our payment obligations under the quality warranties was not sufficient, we could incur significant expenses to resolve such claims or face delays in remedying the related defects, which could in turn harm our reputation, and materially adversely affect our business, financial condition and results of operations.

Our property development schedule may be delayed and our development costs may increase as a result of delayed governmental re-zoning, demolition and resettlement processes.

According to Urban Housing Resettlement Administration Regulations (城市房屋拆遷管理條例) and applicable local regulations, in the case where we are responsible for demolishing existing properties and relocating existing residents, we will be required to pay the corresponding demolition and resettlement costs. If the parties responsible for and subject to the demolition and resettlement fail to reach agreements, either of them may apply for a ruling with the relevant governmental authorities; if the parties are not satisfied with the ruling, they may initiate proceedings in a people’s court within three months from the date of such ruling, which may delay the project. The occurrence of the foregoing may affect our reputation, increase our costs and delay the pre-sales of the relevant project, which may in turn adversely affect our business, financial position and operational performance. We incurred demolition and resettlement costs of RMB131.3 million, RMB30.8 million and RMB35.1 million for the years ended December 31, 201, 2012 and 2013, respectively.

As of the date of this offering memorandum, four of our projects held for future development were required to demolish existing buildings, resettle existing residents and construct basic infrastructure. The respective local government authorities, which are responsible for the demolition, resettlement and construction work, had not completed such work as scheduled in the relevant land grant contracts. We cannot assure you of the timing of the demolition, resettlement and construction work currently undertaken by the relevant local authorities. In case of further delays, our development costs may further increase, and our business, financial condition and results of operations may be adversely affected.

To the extent demolition and resettlement are required in any of our future property developments, we will be required to compensate existing residents an amount calculated in accordance with local resettlement compensation standards. These local standards may change from time to time without advance notice. If such compensation standards are changed to increase the compensation we are required to pay, our land acquisition costs may increase, which could adversely affect our financial condition and results of operations. In respect of projects in which the resettlement costs are borne by us, if we or the local government fail to reach an agreement over the amount of compensation with any existing owner or resident, any party may apply to the relevant authorities for a ruling on the compensation amount. Dissenting owners and residents may also refuse to relocate. Any administrative process or resistance or refusal to relocate may delay our future project development schedules, and an unfavorable final ruling may result in us paying more than the amount required by the local standards. Any occurrence of the above factors may result in increases in our future development costs, which can adversely affect our cash flows, financial condition and results of operations.

We may also acquire projects with parcels of land that need to be re-zoned. We have obtained the land use rights certificate and have submitted an application to re-zone the land parcels in our Changxin Road Project (常新路項目) for commercial use. As of the date of this offering memorandum, we are in the process of negotiating the terms and conditions of such re-zoning with the relevant government authorities. We cannot assure you that these negotiations will be successful and that the approvals will be granted to us in accordance with our plans. If the aforesaid negotiations become unsuccessful or if the approval process becomes delayed in any material respect, our development of the Changxin Road Project will be delayed, our development costs will increase, and our business, financial condition and results of operations may be adversely affected.

Fluctuations in the price of construction materials and contractors’ labor costs could adversely affect our business and financial performance.

The cost of construction materials such as steel as well as labor costs, which constitute a significant portion of our payments to our construction contractors, may fluctuate. Any increase in the cost of construction materials may result in additional costs to us and may lead to future increases in construction contract costs.

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Construction material costs have fluctuated in recent years. Any increase in the cost of any significant construction materials will adversely impact our overall construction costs, which is generally one of the largest components of our cost of sales. If we cannot pass any or all of the increased costs on to our customers, our profitability will be adversely affected.

We may be adversely affected if we fail to redeem the equity interests in any of our project companies we have pledged to trust financing companies to finance our property development projects.

We entered into trust financing arrangements with certain trust financing companies, which act as trustees of the respective trust funds, to finance our property development projects. Our trust financing arrangements generally have a term of two years and entitle the lenders to a fixed income return. To secure such trust financing arrangements, we have entered into a series of contractual arrangements with trust financing companies to pledge to them our equity interests in, and/or land use rights held by, our project companies (“ type (i) arrangements ”). In the past, we entered into arrangements with certain trust financing companies to transfer to them, or allow them to acquire, equity interests in our project companies and assume a corresponding obligation to repurchase any equity interests thereby acquired by these trust financing companies through the satisfaction of our repayment obligations (“ type (ii) arrangements ”). As of December 31, 2013, we did not have any outstanding borrowings from type (i) or type (ii) trust arrangements. Certain of our PRC subsidiaries entered into trust financing arrangements subsequent to December 31, 2013. See “Business −Recent Developments −Trust Financing Arrangements after December 31, 2013.”

Trust financing arrangements involve higher financing costs and risks than conventional bank loans due to their higher interest rates. Any material defaults on our part under the terms of the trust financing arrangements may prevent us from redeeming the pledged equity interests in our project companies from the relevant trust financing companies. We cannot assure you that we will be able to perform all of our obligations under existing and future trust financing arrangements. Should we fail to duly perform our obligations under any of our trust financing arrangements, we will be subject to liabilities for breach of contract. Moreover, we may not be able to redeem the equity interests of our project companies that were pledged under trust financing arrangements, in which case the financial results of the relevant project companies may no longer be consolidated into our financial statements. The occurrence of any of the foregoing may adversely affect our business, financial condition and results of operations.

Property owners may not retain us as the provider of property management services.

We provide property management services to owners of all properties developed by us through our property management subsidiaries, Jiangsu Future Land Property Management Co., Ltd. (江蘇新城物業管理有限公司) and Shanghai Future Land Wanjia Property Service Co., Ltd. (上海新城萬嘉物業服務有限公司). Under PRC laws and regulations, property owners have the right to change the property management service provider upon the approval of a certain percentage of the property owners. If owners of the properties that we have developed were not satisfied with our property management services, they may terminate our property management services or publish negative feedback in respect of our property management services, in which case our reputation, future sales of our properties and results of operations could be adversely affected.

If we were unable to successfully retain the services of our current personnel and hire, train and retain senior executives or key personnel, our ability to develop and successfully market our products could be harmed.

The growth and success of our business has depended significantly on certain members of our senior management, in particular, Chairman Wang. Chairman Wang has approximately 25 years of experience in operating and managing enterprises in China and has more than 17 years of experience in leading our business. In addition, several other members of our management have worked for us for many years and have played, and are expected to continue to play, key roles in making major business decisions. If we were to lose the services of Chairman Wang or any of our senior management for any reason, we may not be able to find suitable replacements for them. As competition in the PRC for senior management and key personnel with experience in property development is intense and the pool of qualified candidates is limited, we may not be able to retain the services of key personnel, or hire, train and retain high quality senior executives or key personnel in the future. In addition, if any member of our senior management team or any of our other key personnel were to join a competitor or carry on a competing business, we may lose customers and key professionals and staff members. Furthermore, as our business continues to grow, we will need to recruit and train additional qualified persons. If any of such incidents occurred, our ability to develop and successfully market our products could be harmed and our business and prospects could be adversely affected.

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Potential liability for health and environmental problems could result in substantial costs.

We are subject to a variety of laws and regulations concerning the protection of health and the environment. Environmental laws can prohibit or severely restrict property development activities in environmentally sensitive regions or areas. Compliance with health and environmental laws and conditions may result in delays, may cause us to incur substantial compliance and other costs and can severely restrict project development activities in environmentally sensitive regions or areas.

As required by PRC laws, independent environmental consultants have conducted environmental impact assessments on all of our construction projects, and the environmental impact assessment documents for our projects were approved by the relevant government authorities before commencement of construction. Local authorities may suspend the construction activities of and impose penalties on project companies that commence construction of a project before the approval of the project’s environmental impact assessment documents. It is possible that there may be material environmental liabilities of which we are unaware, and which may have a material adverse impact on our business.

We may be involved in legal and other disputes from time to time arising out of our operations and may face significant liabilities as a result.

We may from time to time be involved in disputes with various parties involved in the development and the sale of our properties, including contractors, suppliers, construction companies, original inhabitants who are resettled, business partners and purchasers of our properties. These disputes may lead to protests or legal or other proceedings and may result in damage to our reputation, substantial costs and diversion of resources and management’s attention from our core business activities. Purchasers of our properties may take legal action against us if our developed properties are perceived to be inconsistent with our representations and warranties made to such purchasers. In addition, we may have compliance issues with regulatory bodies in the course of our operations, in respect of which we may face administrative proceedings and unfavorable decisions that may result in liabilities and cause delays to our property developments. We may be involved in other proceedings or disputes in the future that may have a material adverse effect on our business, financial condition, results of operations or cash flows.

False, inaccurate or negative media reports about us or our projects, whether substantiated or not, may cause harm to our reputation, divert our management’s attention and adversely affect our business and results of operations.

The development and future trends in the PRC property industry, including business strategies of major property developers, have been the focus of numerous media reports. We are aware of some inaccurate media reports about us and our projects. The dissemination of such inaccurate or negative media reports or public allegations about us, whether or not substantiated, may adversely harm our reputation and affect public opinion about us and our projects. In addition, such inaccurate or negative media reports may require us to engage in defensive actions, which may divert our management’s attention and adversely affect our business and results of operations. We cannot assure you that there will not be any other false, inaccurate or negative media reports about us or our projects in the future. In addition, we do not make any representations as to the appropriateness, accuracy, completeness or reliability of the information in such reports. To the extent that the information in such reports is inconsistent or conflicts with this offering memorandum, you should not rely on such information in making an investment decision and should rely only on the information included in this offering memorandum.

The appraised value of our properties may be different from their actual realizable value and are subject to change.

The appraised value of our properties is based on multiple assumptions that include elements of subjectivity and uncertainty. The assumptions, on which the appraised value of our properties and land reserves are based, include that:

we will develop and complete projects in accordance with our latest development proposals;
we have obtained or will obtain on a timely basis all approvals from regulators necessary for the development of the projects, absence of delays caused by weather and natural disasters, and the timely completion of demolition and relocation; and

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we have paid all the land premiums and demolition and resettlement costs and obtained all land use rights certificates and transferable land use rights without any obligation to pay additional land premium or demolition and resettlement costs.

Some assumptions used to reach the appraised value of our properties may prove inaccurate. Therefore, the appraised value of our properties should not be taken as their actual realizable value or a forecast of their realizable value. Unforeseeable changes to the development of our property projects as well as national and local economic conditions may affect the market value of our property holdings.

Our current insurance coverage may not be adequate to cover all risks related to our operations.

Under PRC law, construction companies bear the primary civil liability for personal injuries arising out of their construction work. The owner of a property under construction may also bear liability supplementary to the liability of the construction company if the latter is not able to fully compensate the injured. The owner of the property may also bear civil liability for personal injuries, accidents and death if such personal injuries, accidents or death are caused by the fault of such owner.

In respect of the properties we hold for commercial leasing or investment, we do not have a unified policy of procuring insurance policies for all such properties. While some of our commercial properties are covered by property all-risk, equipment damage and public liability insurance, each of our subsidiaries holding an interest in and/or managing commercial properties is at liberty to adopt its own insurance policy from different insurance companies with different coverage. The level of insurance coverage acquired for each of the commercial properties we own and/or manage may not be adequate to cover all losses. In addition, none of the properties held or managed by us for investment were covered by loss of profits insurance. Furthermore, there are certain types of losses, such as losses due to earthquakes, typhoons, floods, wars and civil disorders, for which insurance is not available on what we believe to be commercially reasonable terms in China. As a result, we have not purchased insurance to cover any such losses.

If we suffer any losses, damages or liabilities in the course of our business operations, we may not have adequate insurance coverage to provide sufficient funds to cover any such losses, damages or liabilities or to replace any property that has been destroyed. Therefore, there may be instances when we will sustain losses, damages and liabilities because of our lack of insurance coverage, which may in turn materially adversely affect our financial condition and results of operations.

We may be subject to fines due to non-registration of our leases.

Pursuant to the Administration of the Measures for Commodity House Leasing in Urban Areas (商品房屋租賃管理辦法) promulgated on December 1, 2010, lessors or lessees are required to file the lease agreements for registration and obtain property leasing filing certificates for their leases. In the past, we leased out certain of our parking spaces, retail spaces and offices but had not filed for registration or obtained property leasing certificates for the relevant leases. We may be required by relevant government authorities to file the lease agreements for registration and may be subject to a fine for non-registration, which may range from RMB1,000 to RMB10,000. As of the date of this offering memorandum, nine of our lease agreements had not been registered with the relevant government authority, which may subject us to a maximum aggregate penalty of RMB90,000. The registration of these lease agreements, under which we are the lessees, requires additional steps to be taken by the respective lessors which are beyond our control. We cannot assure you that the lessors will be cooperative and that we can complete the registration of these lease agreements and any other lease agreements that we may enter into in the future.

We guarantee mortgage loans of our customers and may become liable to mortgagee banks if customers default on their mortgage loans.

In accordance with industry practice, banks require us to guarantee mortgage loans taken by purchasers of the properties that we develop. Typically, we guarantee mortgage loans taken out by purchasers up until when we complete the relevant properties and (i) the property ownership certificates and the mortgage are registered in favor of the mortgagee bank or (ii) the mortgage loans between the mortgagee bank and the purchaser are settled. If a purchaser defaults on a mortgage loan, we may be required to repurchase the underlying property by paying off the mortgage. If we fail to do so, the mortgagee bank may auction the underlying property and recover any additional amount outstanding from us as the guarantor of the mortgage loans. In line with industry practice, we do not conduct any independent credit checks on our customers and rely on the credit evaluation conducted by the mortgagee banks on such customers. These are contingent liabilities not recognized in our consolidated statements of financial position.

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As of December 31, 2013, our outstanding guarantees in respect of the residential mortgages of our customers amounted to RMB2,980.7 million. For the three years ended December 31, 2013, we encountered 13 incidents of default by purchasers, which involved an aggregate default payment of approximately RMB11.2 million, all of which we were able to recover. Should any material default occur and if we were called upon to honor our guarantees, our financial condition and results of operations could be adversely affected.

Certain important decisions regarding Jiangsu Future Land may require approval by its independent directors and/or the consent of its independent public shareholders and we cannot assure you that our strategies, policies and objectives will be adopted by Jiangsu Future Land.

A substantial part of our business is carried out through Jiangsu Future Land, whose B shares are listed on the Shanghai Stock Exchange. As of the date of this offering memorandum, Jiangsu Future Land’s issued capital was held as to 58.86% by Future Land Holdings, our subsidiary, and as to 41.14% by other shareholders. Jiangsu Future Land has historically contributed a significant portion of our Group’s total revenue. See “Relationship with Jiangsu Future Land.”

Although Jiangsu Future Land is majority owned by our Company, it is a public company and thus required under the relevant PRC laws and regulations to observe the applicable corporate governance rules that require its operations to be conducted independently of its controlling shareholders. Certain important decisions that may materially affect the interests of the B-shareholders of Jiangsu Future Land as a whole, including but not limited to, any decision to issue new securities of the company, undergo material restructuring of assets, acquire substantial assets, procure overseas listing of material subsidiaries or repurchase shares from shareholders as repayment of any loan extended to such shareholders, require approval of the independent directors and/or the shareholders of Jiangsu Future Land who are independent from its controlling shareholders, in accordance with the terms of its articles of association. We cannot assure you that the strategies, policies and objectives that we support regarding Jiangsu Future Land will align with the interests of its independent directors and/or shareholders.

Risks Relating to Our Industry

The PRC property market is heavily regulated and subject to frequent introduction of new regulations, including further measures by the PRC government to slow down the growth of the property sector, which may adversely affect property developers.

The PRC government exerts considerable direct and indirect influence on the growth and development of the PRC property market through industry policies and other economic measures such as setting interest rates, controlling the supply of credit by changing bank reserve ratios and implementing lending restrictions, increasing tax and duties on property transfers and imposing foreign investment and currency exchange restrictions. In recent years, the PRC government has introduced a series of regulations and policies designed to generally control the growth of the property market, including, among others:

strictly enforcing the idle land related laws and regulations;
restricting the grant or extension of revolving credit facilities to property developers that hold a large amount of idle land and vacant commodity properties;
prohibiting commercial banks from lending funds to real estate developers with an internal capital ratio of less than certain prescribed percentage; and
restricting PRC commercial banks from granting loans to property developers for the purpose of paying land grant premiums.

In particular, the PRC government also introduced the following policies, among others, to specifically control the growth of the residential property market:

limiting the maximum amount of monthly mortgage and the maximum amount of total monthly debt service payments of an individual borrower;
imposing a business tax levy on the sales proceeds for second-hand transfers subject to the length of holding period and type of properties;
increasing the minimum amount of down payment of the purchase price of the residential property of a family;

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tightening the availability of individual housing loans in the property market to individuals and their family members with more than one residential property;
imposing a 20% individual income tax on the gain from the sale of second-hand properties; and
limiting the availability of individual housing provident fund loans for the purchase of second (or more) residential properties by employees and their family members.

Following a downturn in the PRC property market in late 2008 and early 2009, property prices and transaction volume began increasing sharply in the second half of 2009. This has led to imposition of further regulations and policies by the PRC government aimed at slowing down the property market. These measures resulted in downward pricing pressures on the PRC property market starting in the second half of 2011 and low transaction volumes the first half of 2012.

Although the transaction volumes and average selling prices experienced a slight increase in late 2012 and 2013, we cannot assure you that the PRC government will not implement further tightening measures to restrain the PRC property market at the national, provincial, municipal and/or local level, in which case the declining trends in transaction volume and selling prices of properties in the PRC may continue or further intensify, and as a result, our financial condition and results of operations may be, and or may continue to be, adversely affected.

The PRC property market is volatile.

The PRC property market is volatile and may experience undersupply or oversupply of property units and significant property price fluctuations. Our business depends and will continue to depend on the growth of the economy in the PRC. A significant downturn in the PRC economy could adversely affect the demand for commercial and residential properties.

The PRC central and local governments frequently adjust monetary, fiscal or other economic policies to prevent and curtail the overheating of the economy, which may affect the PRC property market. Such policies may lead to changes in market conditions, including price instability and an imbalance of supply and demand in respect of commercial and residential properties, which may materially adversely affect our business and financial condition. We cannot assure you that there will not be overdevelopment in the PRC property markets, which may in turn cause an oversupply of properties that depresses sale prices and rental income, that would result in an undersupply of potential development sites or increases in land acquisition costs in the markets in which we operate. Such effects may adversely affect our business, financial condition and results of operations.

We face intense competition.

The property market in the Yangtze River Delta and major cities along the Shanghai-Nanjing Economic Corridor has been highly competitive in recent years. Property developers from the PRC and overseas have entered the property development markets in the Yangtze River Delta and major cities along the ShanghaiNanjing Economic Corridor where we have operations and we may expand into. Many of our competitors, including overseas listed foreign developers and top-tier domestic developers, may have more financial or other resources than us and may be more sophisticated than us in terms of engineering and technical skills. Competition among property developers may cause an increase in land costs and raw material costs, shortages in quality construction contractors, surplus in property supply leading to property price decline, further delays in issuance of governmental approvals, and higher costs to attract or retain talented employees. Moreover, property markets across the PRC are influenced by various other factors, including changes in economic conditions, banking practices and consumer sentiment. If we fail to compete effectively, our business operations and financial condition will suffer.

Risks Relating to Doing Business in the PRC

PRC economic, political and social conditions as well as government policies could adversely affect our business and prospects.

The PRC economy differs from the economies of most of the developed countries in many aspects, including:

political structure;
the amount and degree of the PRC government involvement and control;

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level of corruption;
growth rate and degree of development;
level and control of capital investment and reinvestment;
control of foreign exchange; and
allocation of resources.

The PRC economy has been transitioning from a centrally planned economy to a more market-oriented economy. For approximately three decades, the PRC government has implemented economic reform measures to utilize market forces in the development of the PRC economy. We cannot predict whether changes in the PRC’s economic, political and social conditions and in its laws, regulations and policies will have any adverse effect on our current or future business, financial condition or results of operations.

In addition, many of the economic reforms carried out by the PRC government are unprecedented or experimental and are expected to be refined and improved over time. This refining and adjustment process may not necessarily have a positive effect on our operations and business development. For example, the PRC government has in the past implemented a number of measures intended to slow down certain segments of the economy, including the real estate industry, which the government believed to be overheating. These actions, as well as other actions and policies of the PRC government, could cause a decrease in the overall level of economic activity in the PRC and, in turn, have an adverse impact on our business and financial condition.

The national and regional economies in China and our prospects may be adversely affected by natural disasters, acts of God, and occurrence of epidemics.

Our business is subject to general economic and social conditions in China. Natural disasters, epidemics and other acts of God which are beyond our control may adversely affect the economy, infrastructure and livelihood of the people in China. In addition, past occurrences of epidemics, depending on their scale, have caused different degrees of damage to the national and local economies in China. A recurrence of SARS or an outbreak of any other epidemics in China, such as the avian flu or the human swine flu, especially in the cities where we have operations, may result in material disruptions to our property development projects and our sales and marketing efforts, which in turn may adversely affect our financial condition and results of operations.

Interpretation of PRC laws and regulations involves uncertainty and the current legal environment in China could limit the legal protections available to you.

Our business is conducted in China and is governed by PRC laws and regulations. All of our subsidiaries are located in China and are subject to PRC laws and regulations. The PRC legal system is a civil law system based on written statutes, and prior court decisions have little precedential value and can only be used as a reference. Additionally, PRC written statutes are often principle-oriented and require detailed interpretations by the enforcement bodies to further apply and enforce such laws. Since 1979, the PRC legislature has promulgated laws and regulations in relation to economic matters such as foreign investment, corporate organization and governance, commercial transactions, taxation and trade, with a view to developing a comprehensive system of commercial law, including laws relating to property ownership and development. However, due to the fact that these laws and regulations have not been fully developed, and because of the limited volume of published cases and the non-binding nature of prior court decisions, interpretation of PRC laws and regulations involves a degree, sometimes a significant degree, of uncertainty. Depending on the government agency or how or by who an application or case is presented to such agency, we may receive less favorable interpretation of laws and regulations than our competitors. In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention. All these uncertainties may limit the legal protections available to foreign investors, including you.

We may be deemed a PRC resident enterprise under the PRC CIT Law and be subject to PRC taxation on our worldwide income.

Under the PRC Corporate Income Tax Law (“ PRC CIT Law ”), which came into effect on January 1, 2008, enterprises established outside China whose “de facto management bodies” are located in China are considered “resident enterprises” and their global income will generally be subject to the uniform 25% Corporate Income Tax (“ CIT ”) rate. Under the Implementation Rules for the PRC CIT Law, “de facto management bodies” is defined as the bodies that have material and overall management control over the business, personnel, accounts and properties of an enterprise.

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Substantially all of our management is currently based in China and may remain in China. In April 2009, the PRC State Administration of Taxation (the “ SAT ”) promulgated a circular to clarify the definition of “de facto management bodies” for enterprises incorporated overseas with controlling shareholders being onshore enterprises or enterprise groups in China. However, it remains unclear how the tax authorities will treat an overseas enterprise invested or controlled by another overseas enterprise and ultimately controlled by PRC individual residents, as in our case. Therefore, we may be treated as a PRC resident enterprise for PRC CIT purposes. The tax consequences of such treatment are currently unclear as they will depend on how PRC finance and tax authorities apply or enforce the PRC CIT Law and the Implementation Rules.

We cannot guarantee the accuracy of facts, forecasts and other statistics with respect to China, the PRC economy and the PRC real estate industry contained in this offering memorandum.

Facts, forecasts and other statistics in this offering memorandum relating to China, the PRC economy and the PRC real estate industry have been derived from various official government publications generally believed to be reliable. However, we cannot guarantee the quality or reliability of such materials. They have not been prepared or independently verified by us, the Initial Purchasers or any of our or their respective affiliates or advisers and, therefore, we make no representation as to the accuracy of such facts, forecasts and statistics, which may not be consistent with other information compiled within or outside China. We have, however, taken reasonable care in the reproduction and/or extraction of the official government publications for the purpose of disclosure in this offering memorandum. Due to possibly flawed or ineffective collection methods or discrepancies between published information and market practice, these facts, forecasts and statistics in this offering memorandum may be inaccurate or may not be comparable to facts, forecasts and statistics produced with respect to other economies. Further, there can be no assurance that they are stated or compiled on the same basis or with the same degree of accuracy as the case may be in other jurisdictions. Therefore, you should not unduly rely upon the facts, forecasts and statistics with respect to China, the PRC economy and the PRC real estate industry contained in this offering memorandum.

Risks Relating to the Notes

We are a holding company and payments with respect to the Notes are structurally subordinated to liabilities, contingent liabilities and obligations of our subsidiaries.

We are a holding company with no material operations. We conduct our operations through our PRC subsidiaries. The Notes will not be guaranteed by any current or future PRC subsidiaries. Our primary assets are ownership interests in our PRC subsidiaries, which are held through the Subsidiary Guarantors and certain Non-Guarantor Subsidiaries. The Subsidiary Guarantors do not, and the JV Subsidiary Guarantors (if any) may not, have material operations. Accordingly, our ability to pay principal and interest on the Notes and the ability of the Subsidiary Guarantors and the JV Subsidiary Guarantors (if any) to satisfy their obligations under the Subsidiary Guarantees or the JV Subsidiary Guarantees (as the case may be) will depend upon distributions of dividends from our subsidiaries.

Creditors, including trade creditors, of Non-Guarantor Subsidiaries and any holders of preferred shares in such entities would have a claim on the Non-Guarantor Subsidiaries’ assets that would be prior to the claims of holders of the Notes. As a result, our payment obligations under the Notes will be effectively subordinated to all existing and future obligations of our Non-Guarantor Subsidiaries and all claims of creditors of our Non-Guarantor Subsidiaries will have priority as to the assets of such entities over our claims and those of our creditors, including holders of the Notes. As of December 31, 2013, we had outstanding borrowings from banks of RMB11,222.5 million (US$1,853.8 million) and we had provided guarantees of RMB2,980.7 million (US$492.4 million) to PRC banks in respect of the mortgage loans provided by the banks to purchasers of our developed properties. The Notes and the indenture permit us, the Subsidiary Guarantors, the JV Subsidiary Guarantors (if any) and the Non-Guarantor Subsidiaries to incur additional indebtedness and issue additional guarantees, subject to certain limitations. In addition, our secured creditors or those of any Subsidiary Guarantor or JV Subsidiary Guarantor (if any) would have priority as to our assets or the assets of such Subsidiary Guarantor or JV Subsidiary Guarantor (if any) securing the related obligations over claims of holders of the Notes.

Under the terms of the Notes, a Subsidiary Guarantee required to be provided by a subsidiary of the Company under the terms of the Notes may be replaced by a limited-recourse guarantee, or JV Subsidiary Guarantee. See “Risk Relating to the Guarantees and the Collateral – Our initial Subsidiary Guarantors do not currently have significant operations and certain Subsidiary Guarantees may in some cases be replaced by

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limited-recourse guarantees.” Recovery under a JV Subsidiary Guarantee is limited to an amount equal to our proportional interest in the issued share capital of such Subsidiary Guarantor, or JV Subsidiary Guarantor, multiplied by the fair market value of the total assets in such JV Subsidiary Guarantor and its subsidiaries, on a consolidated basis, as of the date of the last fiscal year end of the Company. As a result, the amount that may be recovered by the Trustee pursuant to a JV Subsidiary Guarantee (compared to a Subsidiary Guarantee) is reduced, which in turn may affect your ability to recover any amounts due under the Notes.

We have substantial indebtedness, including that under the January 2018 Notes and the April 2016 Notes, and may incur substantial additional indebtedness in the future, which could adversely affect our financial health and our ability to generate sufficient cash to satisfy our outstanding and future debt obligations.

We now have, and will continue to have after the offering of the Notes, a substantial amount of indebtedness. Our total current and non-current borrowings, which include our borrowings from banks and trust financing arrangements, were RMB10,866.6 million, RMB9,640.1 million and RMB11,222.5 million (US$1,853.8 million) as of December 31, 2011, 2012 and 2013, respectively. In addition, as of the date of this offering memorandum, the principal amount of our January 2018 Notes amounted to US$200.0 million and the principal amount of our April 2016 Notes amounted to RMB1,500.0 million.

Our substantial indebtedness could have important consequences to you. For example, it could:

limit our ability to satisfy our obligations under the Notes and other debt;
increase our vulnerability to adverse general economic and industry conditions;
require us to dedicate a substantial portion of our cash flow from operations to servicing and repaying our indebtedness, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate purposes;
limit our flexibility in planning for or reacting to changes in our businesses and the industry in which we operate;
place us at a competitive disadvantage compared to our competitors that have less debt;
limit, along with the financial and other restrictive covenants of our indebtedness, among other things, our ability to borrow additional funds; and
increase the cost of additional financing.

In the future, we may from time to time incur substantial additional indebtedness (including bank borrowings and/or onshore or offshore bond offerings) and contingent liabilities. If we or our subsidiaries incur additional debt, the risks that we face as a result of our already substantial indebtedness and leverage could intensify.

Our ability to generate sufficient cash to satisfy our outstanding and future debt obligations will depend upon our future operating performance, which will be affected by prevailing economic conditions and financial, business and other factors, many of which are beyond our control. We anticipate that our operating cash flow will be sufficient to meet our anticipated operating expenses and to service our debt obligations as they become due. However, we may not be able to generate sufficient cash flow for these purposes. If we are unable to service our indebtedness, we will be forced to adopt an alternative strategy that may include actions such as reducing or delaying capital expenditures, selling assets, restructuring or refinancing our indebtedness or seeking equity capital. These strategies may not be instituted on satisfactory terms, if at all.

In addition, the terms of the indenture governing the Notes prohibit us from incurring additional indebtedness unless (i) we are able to satisfy certain financial ratios or (ii) we are able to incur such additional indebtedness pursuant to any of the exceptions to the financial ratio requirements, and meet any other applicable restrictions. Our ability to meet our financial ratios may be affected by events beyond our control. We might not be able to meet these ratios. Certain of our existing financing arrangements also impose operating and financial restrictions on our business. See the section headed “Description of Material Indebtedness and Other Obligations.” Such restrictions in the indenture and our other financing arrangements may negatively affect our

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ability to react to changes in market conditions, take advantage of business opportunities we believe to be desirable, obtain future financing, fund required capital expenditures, or withstand a continuing or future downturn in our business or the general economy. Any of these factors could materially and adversely affect our ability to satisfy our obligations under the Notes and other debt.

To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control.

Our ability to make payments on and to refinance our indebtedness, including these Notes, and to fund planned capital expenditures and project development will depend on our ability to generate cash. This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

Our business might not generate sufficient cash flow from operations to enable us to pay our indebtedness, including the Notes, or to fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness, including the Notes, on or before maturity. We might not be able to refinance any of our indebtedness on commercially reasonable terms or at all. If we are unable to service our indebtedness or obtain refinancing on terms acceptable to us, we may be forced to adopt an alternative strategy that may include reducing or delaying capital expenditures, selling assets or seeking equity capital. These strategies may not be instituted on satisfactory terms, if at all.

Our subsidiaries are subject to restrictions on the payment of dividends and the repayment of intercompany loans or advances to us and our subsidiaries.

As a holding company, we depend on the receipt of dividends and the interest and principal payments on intercompany loans or advances from our subsidiaries, including our PRC subsidiaries, to satisfy our obligations, including our obligations under the Notes. The ability of our subsidiaries to pay dividends and to make payments on intercompany loans or advances to their shareholders is subject to, among other things, their distributable earnings and cash flow conditions, restrictions contained in the articles of association and the loan agreements entered into by our subsidiaries and applicable laws. For example, some of our subsidiaries are restricted from distributing dividends until their existing indebtedness are paid off and they start to generate profit. In addition, if any of our subsidiaries raises capital by issuing equity securities to third parties, dividends declared and paid with respect to such equity securities (including, for example, dividends paid to the public shareholders of our subsidiary, Jiangsu Future Land) would not be available to us to make payments on the Notes. These restrictions could reduce the amounts that we receive from our subsidiaries, which would restrict our ability to meet our payment obligations under the Notes and the obligations of the Subsidiary Guarantors or the JV Subsidiary Guarantors (if any) under the Subsidiary Guarantees or the JV Subsidiary Guarantees, as the case may be.

PRC laws and regulations permit payment of dividends only out of accumulated profits as determined in accordance with PRC accounting standards and regulations and such profits differ from profits determined in accordance with HKFRSs in certain significant respects, including the use of different bases of recognition of revenue and expenses. Our PRC subsidiaries are also required to set aside a portion of their after-tax profits according to PRC accounting standards and regulations to fund certain reserves that are not distributable as cash dividends. In practice, our PRC project companies may pay dividends only after they have completed the development of the project (or at least the development of a phase or a stand-alone tower or building), collected payment and completed the required government tax clearance and foreign exchange procedures. In addition, dividends paid by our PRC subsidiaries to their non-PRC parent company are subject to a 10% withholding tax, unless there is a tax treaty between the PRC and the jurisdiction in which the overseas parent company is incorporated, which specifically exempts or reduces such withholding tax. Pursuant to arrangements relating to the avoidance of double taxation between Hong Kong and the PRC, if the non-PRC parent company is a Hong Kong resident and directly holds a 25% or more interest in the PRC enterprise, such withholding tax rate may be lowered to 5%. However, according to the Circular on Interpretation and Determination of the “Beneficial Owners” Under Tax Treaties (國家稅務總局關於如何理解和認定稅收協定中“受益所有人”的通知) (國稅函 [2009]601 號) from SAT dated October 27, 2009, tax treaty benefits are not available to conduit or shell companies without substantive business activities. Therefore, it is unclear whether dividend payments made by our PRC subsidiaries to our Hong Kong subsidiary (which holds the equity interests in our PRC subsidiaries) will quality for the 5% rate in any particular year. As a result of such restrictions, there could be limitations, including timing limitations, on our ability to receive payments from our PRC subsidiaries to meet our payment obligations under the Notes and the obligations of the Subsidiary Guarantors or the JV Subsidiary Guarantors (if any) under the Subsidiary Guarantees or the JV Subsidiary Guarantees, as the case may be, and there could be restrictions on payments required to redeem the Notes at maturity or as required for any early redemption.

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Furthermore, although we currently do not have any offshore shareholder loan to our PRC subsidiaries, we may resort to such offshore lending in the future, rather than equity contributions, to our PRC subsidiaries to finance their operations. In such event, the market interest rates that our PRC subsidiaries can pay with respect to offshore loans generally may not exceed comparable interest rates in the international finance markets. The interest rates on shareholder loans paid by our subsidiaries, therefore, are likely to be lower than the interest rate for the Notes. Our PRC subsidiaries are also required to pay withholding tax at a rate of 10% (or a lower treaty rate, if any) on our behalf on the interest paid under any shareholder loan. Prior to payment of interest and principal on any such shareholder loan, the PRC subsidiaries (as foreign-invested enterprises in China) must present evidence of payment of the withholding tax on the interest payable on any such shareholder loan and evidence of registration with the State Administration of Foreign Exchange of the PRC (“ SAFE ”), as well as any other documents that SAFE or its local branch may require.

As a result of the foregoing, we cannot assure you that we will have sufficient cash flow from dividends or payments on intercompany loans or advances from our subsidiaries to satisfy our obligations under the Notes or the obligations of the Subsidiary Guarantors or the JV Subsidiary Guarantors (if any) under the Subsidiary Guarantees or the JV Subsidiary Guarantees, as the case may be.

Under PRC regulations, we may not be able to transfer to our PRC subsidiaries proceeds from this offering in the form of a loan, which could impair our ability to make timely payments of interest, or even principal, under the Notes.

According to the existing PRC rules and regulations relating to supervision of foreign debt, loans by foreign companies to their subsidiaries in China are considered foreign debt, and such debt must be registered with the relevant local branches of SAFE. In April 2013, the SAFE issued the Administrative Measures for Registration of Foreign Debt (外債登記管理辦法) (匯發[2013]19號) and Guidelines on the Administration of Registration of Foreign Debt (外債登記管理操作指引), which provide that (inter alia) (i) the SAFE will not process a foreign debt registration of any foreign invested real estate enterprise which obtained its certificate of authorization and completed the filing procedures with MOFCOM on or after June 1, 2007; (ii) foreign invested real estate enterprises established prior to June 1, 2007 may borrow foreign debt up to an amount not exceeding the difference between its total investment and registered capital; and (iii) a foreign invested real estate enterprise that has not fully paid up its registered capital or obtained land use rights certificates, or the paid-in capital of its development projects is less than 35% of the total investment of such projects is not allowed to borrow foreign debt. Our subsidiary, Changzhou Wealth Zone Development Co., Ltd. (“ Changzhou Wealth Zone ”) has been a foreign invested-enterprise since August, 2003. Therefore, any proceeds of this offering can be transferred to it as loans. However, the amount of the loans shall not exceed the difference between its total investment and registered capital, and such loans shall be registered with the relevant local branches of SAFE.

In addition, equity contributions by us and our non-PRC subsidiaries to our PRC subsidiaries will require approvals from the commerce department of the local government and filing with the local branch of SAFE and MOFCOM, which may take considerable time and result in delays of receiving the contribution. This may in turn adversely affect the financial condition of the PRC subsidiaries and cause delays to the development undertaken by such PRC subsidiaries. We might not be able to obtain necessary approvals for our PRC subsidiaries at all.

Further, the PRC government may introduce new policies that could further restrict our ability to use funds raised outside China. Therefore, we may not be able to use all or any of the funds that we raise outside China as intended.

Fluctuations in the value of the Renminbi may have a material adverse impact on your investment.

Substantially all of our revenue and expenditures are denominated in Renminbi, while the net proceeds from this offering and any interest we pay on the Notes will be in U.S. dollars. Fluctuations in the exchange rate between the Renminbi and U.S. dollars will affect the relative purchasing power in Renminbi terms of the proceeds from this offering. Fluctuations in the exchange rate may also cause us to incur foreign exchange losses and affect the relative value of any dividend issued by our PRC subsidiaries. In addition, appreciation or depreciation in the value of the Renminbi relative to U.S. dollars would affect our financial results in U.S. dollars terms without giving effect to any underlying change in our business or results of operations. Moreover, because the functional currency of the Company and all of its subsidiaries is the Renminbi, the balance and certain amounts due to related parties denominated in a foreign currency are subject to translation at each reporting date, which could affect our business, financial condition and results of operations. Movements in Renminbi exchange rates are affected by, among other things, changes in political and economic conditions and China’s foreign exchange regime and policy. Since July 2005, the Renminbi has not been pegged to the U.S.

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dollars. The Renminbi may appreciate or depreciate significantly in value against the U.S. dollars in the medium to long term. Moreover, it is possible that in the future PRC authorities may lift restrictions on fluctuations in Renminbi exchange rates and lessen intervention in the foreign exchange market.

There are limited hedging instruments available in China to reduce our exposure to exchange rate fluctuations between the Renminbi and other currencies. To date, we have not entered into any hedging transactions in an effort to reduce our exposure to foreign currency exchange risks. In any event, the availability and effectiveness of these hedges may be limited and we may not be able to hedge our exposure successfully, or at all.

Interest payable by us to our foreign investors and gain on the sale of our Notes may become subject to withholding taxes under PRC tax laws.

Under the PRC CIT Law, if we are deemed a PRC resident enterprise, the interest payable on the Notes will be considered to be sourced within China. PRC income tax at the rate of 10% will be applicable to such interest payable by us to investors that are “non-resident enterprises” so long as such “non-resident enterprise” investors do not have an establishment or place of business in China or, if there is such establishment or place of business in China, the relevant income is not effectively connected with such establishment or place of business in China. Similarly, any gain realized on the transfer of the Notes by such investors will be subject to a 10% PRC income tax if such gain is regarded as income derived from sources within China. It is uncertain whether we will be considered a PRC “resident enterprise,” so it is unclear whether the interest payable to our foreign investors, or the gain our foreign investors may realize from the transfer of our Notes, would be treated as income sourced within China and be subject to PRC tax. If we are required under the PRC CIT Law to withhold PRC income tax on our interest payable to our foreign shareholders who are “non-resident enterprises,” we will be required to pay such additional amounts as are necessary to ensure receipt by the holder of the full amount which the holder would have received but for such withholding. The requirement to pay additional amounts will increase the cost of servicing interest payments on the Notes and could have a material adverse effect on our ability to pay interest on, and repay the principal amount of, the Notes, as well as our profitability and cash flows. In addition, if you are required to pay PRC income tax on the transfer of our Notes, the value of your investment in our Notes may be materially and adversely affected. It is unclear whether, if we are considered a PRC “resident enterprise,” holders of our Notes might be able to claim the benefit of income tax treaties or agreements entered into between China and other countries or areas.

We may be able to redeem the Notes in whole at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest in the event we are required to pay additional amounts as a result of future changes in law.

As described under “Description of the Notes – Redemption for Taxation Reasons,” in the event we are required to pay additional amounts as a result of future changes in specified tax law or future changes in the existing official position or the stating of an official position regarding the application or interpretation of such law tax that results in our being required to withhold tax on interest payments due to our being treated as a PRC resident enterprise, we may redeem the Notes in whole at a redemption price equal to 100% of the principal amount plus accrued and unpaid interest.

The insolvency laws of the Cayman Islands and other local insolvency laws may differ from those of another jurisdiction with which holders of the Notes are familiar.

Because we and some of the Subsidiary Guarantors are incorporated, and the JV Subsidiary Guarantors (if any) may be incorporated, under the laws of the Cayman Islands or Hong Kong, an insolvency proceeding relating to us or any such Subsidiary Guarantor or JV Subsidiary Guarantor, would likely involve Cayman Islands or Hong Kong insolvency laws, the procedural and substantive provisions of which may differ from comparable provisions of other jurisdictions with which the holders of the Notes are familiar.

We conduct substantially all of our business operations through PRC-incorporated subsidiaries in China. The Subsidiary Guarantors, as equity holders in our PRC subsidiaries, are necessarily subject to the bankruptcy and insolvency laws of China in a bankruptcy or insolvency proceeding involving any such PRC subsidiaries. Any JV Subsidiary Guarantors which become equity holders of our PRC subsidiaries would also be subject to such laws. The PRC laws and regulations relating to bankruptcy and insolvency and the legal proceedings in that regard may significantly differ from those of other jurisdictions with which the holders of the Notes are familiar. You should analyze the risks and uncertainties carefully before you invest in our Notes.

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We may be unable to obtain and remit foreign exchange.

Our ability to satisfy our obligations under the Notes depends solely upon the ability of our PRC subsidiaries to obtain and remit sufficient foreign currency to pay dividends to us and, if applicable, to repay shareholder loans. Our PRC subsidiaries must present certain documents to SAFE, its authorized branch, or the designated foreign exchange bank, for approval before they can obtain and remit foreign currencies out of China, including, in the case of dividends, evidence that the relevant PRC taxes have been paid and, in the case of shareholder loans, evidence of the registration of the loan with SAFE. Prior to payment of interest and principal on any shareholder loan we make to our PRC subsidiaries, the relevant PRC subsidiary must also present evidence of payment of withholding tax at a rate of 10% or a lower tax treaty rate, if any, on the interest payable in respect of such shareholder loan. If any PRC subsidiary for any reason fails to satisfy any of the PRC legal requirements for remitting foreign currency payments, the PRC subsidiary will be unable to pay us dividends or interest and principal on shareholder loans, which may affect our ability to satisfy our obligations under the Notes.

If we are unable to comply with the restrictions and covenants in our debt agreements or the indenture governing the Notes, there could be a default under the terms of these agreements or the indenture governing the Notes, which could cause repayment of our debt to be accelerated.

If we are unable to comply with the restrictions and covenants in the indenture governing the Notes or our current or future debt obligations and other agreements, there could be a default under the terms of these agreements. In the event of a default under these agreements, the holders of the debt could terminate their commitments to lend to us, accelerate repayment of the debt and declare all outstanding amounts due and payable or terminate the agreements, as the case may be. Furthermore, some of our debt agreements, including the indenture governing the Notes, contain cross-acceleration or cross-default provisions. As a result, our default under one debt agreement may cause the acceleration of repayment of not only such debt but also other debt, including the Notes, or result in a default under our other debt agreements, including the indenture governing the Notes. If any of these events occur, we cannot assure you that our assets and cash flow would be sufficient to repay in full all of our indebtedness, or that we would be able to find alternative financing. Even if we could obtain alternative financing, we cannot assure you that it would be on terms that are favorable or acceptable to us.

We may not be able to repurchase the Notes, the January 2018 Notes or the April 2016 Notes upon a Change of Control Triggering Event.

We must offer to purchase the Notes, the January 2018 Notes and the April 2016 Notes upon the occurrence of certain types of changes of control at a purchase price equal to 101% of their respective principal amount plus accrued and unpaid interest. See the section headed “Description of the Notes.” The source of funds for any such purchase would be our available cash or third-party financing. However, we may not have sufficient available funds at the time of the occurrence of any change of control to make purchases of the outstanding Notes, January 2018 Notes and April 2016 Notes. Our failure to make the offer to purchase or to purchase the outstanding Notes, January 2018 Notes and April 2016 Notes would constitute an event of default under the Notes, the January 2018 Notes and the April 2016 Notes. The event of default may, in turn, constitute an event of default under other indebtedness, any of which could cause the related debt to be accelerated after any applicable notice or grace periods. If our other debt were to be accelerated, we may not have sufficient funds to purchase the Notes, the January 2018 Notes and the April 2016 Notes and repay the debt.

In addition, the definition of change of control for purposes of the indentures governing the Notes, the January 2018 Notes and the April 2016 Notes does not necessarily afford protection for the holders of the Notes, the January 2018 Notes and the April 2016 Notes in the event of some highly-leveraged transactions, including certain acquisitions, mergers, refinancings, restructurings or other recapitalizations. These types of transactions could, however, increase our indebtedness or otherwise affect our capital structure or credit ratings. The definition of change of control for purposes of the indentures governing the Notes, the January 2018 Notes and the April 2016 Notes also includes a phrase relating to the sale of “all or substantially all” of our assets. Although there is a limited body of case law interpreting the phrase “substantially all,” there is no precise established definition under applicable law. Accordingly, our obligation to make an offer to purchase the Notes, the January 2018 Notes and the April 2016 Notes and the ability of a holder of the Notes, the January 2018 Notes and the April 2016 Notes to require us to purchase its notes pursuant to the offer as a result of a highly-leveraged transaction or a sale of less than all of our assets may be uncertain.

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Our operations are restricted by the terms of the Notes, which could limit our ability to plan for or to react to market conditions or meet our capital needs, which could increase your credit risk.

The indenture governing the Notes includes a number of significant restrictive covenants. These covenants restrict, among other things, our ability, and the ability of our Restricted Subsidiaries, to:

incur or guarantee additional indebtedness and issue disqualified or preferred stock;
declare dividends on capital stock or purchase or redeem capital stock;
make investments or other specified restricted payments;
issue or sell capital stock of Restricted Subsidiaries;
guarantee indebtedness of Restricted Subsidiaries;
sell assets;
create liens;
enter into sale and leaseback transactions;
engage in any business other than permitted business;
enter into agreements that restrict the Restricted Subsidiaries’ ability to pay dividends, transfer assets or make intercompany loans;
enter into transactions with shareholders or affiliates; and
effect a consolidation or merger.

These covenants could limit our ability to plan for or react to market conditions or to meet our capital needs. Our ability to comply with these covenants may be affected by events beyond our control, and we may have to curtail some of our operations and growth plans to maintain compliance.

A trading market for the Notes may not develop, and there are restrictions on resale of the Notes.

Although approval in-principle has been received for the listing and quotation of the Notes on the SGX-ST, we cannot assure you that we will obtain or be able to maintain a listing on the SGX-ST, or that, if listed, a liquid trading market will develop. We have been advised that the Initial Purchasers intend to make a market in the Notes, but the Initial Purchasers are not obligated to do so and may discontinue such market making activity at any time without notice. In addition, the Notes are being offered pursuant to exemptions from registration under the Securities Act and, as a result, you will only be able to resell your Notes in transactions that have been registered under the Securities Act or in transactions not subject to or exempt from registration under the Securities Act. See the section headed “Transfer Restrictions.” If an active trading market does not develop or is sustained, the market price and liquidity of the Notes could be adversely affected.

The ratings assigned to the Notes and our corporate ratings may be lowered or withdrawn in the future.

The Notes are expected to be rated B+ by S&P and B1 by Moody’s. The ratings address our ability to perform our obligations under the terms of the Notes and credit risks in determining the likelihood that payments will be made when due under the Notes. In addition, we have been assigned a long-term corporate credit rating of BB- with a stable outlook by S&P and a corporate family rating of Ba3 with a stable outlook by Moody’s. A rating may not remain for any given period of time and could be lowered or withdrawn entirely by the relevant rating agency. A rating is not a recommendation to buy, sell or hold securities and may be subject to revision, suspension or withdrawal at any time. We have no obligation to inform holders of the Notes of any such revision, suspension or withdrawal. A reduction, suspension or withdrawal at any time of the rating assigned to the Notes may adversely affect the market price of the Notes.

Certain transactions that constitute “connected transactions” under the listing rules of the Hong Kong Stock Exchange will not be subject to the “Limitation on Transactions with Shareholders and Affiliates” covenant.

Our shares are listed on the Hong Kong Stock Exchange and we are required to comply with its listing rules, which provide, among other things, that any transaction between a listed company or any of its

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subsidiaries, on the one hand, and a “connected person” of such listed company, on the other hand, is a “connected transaction” that, if the value of such transaction exceeds the applicable de minimis thresholds, will require certain procedural requirements to be completed or approvals to be obtained. The “Limitation on Transactions with Shareholders and Affiliates” covenant in the Notes only applies to transactions between the Company or any Restricted Subsidiary, on the one hand, and (x) any holder (or any affiliate of such holder) of 10% or more of the shares of the Company or (y) any affiliate of the Company, on the other hand. As such, transactions between the Company or any Restricted Subsidiary, on the one hand, and an affiliate of any Restricted Subsidiary, on the other hand, will not be captured by such covenants, even though they are subject to the independent shareholders’ requirement under the Listing Rules. As a result, we are not required by the terms of the Notes to ensure that any such transactions are on terms that are fair and reasonable, and we will not need to deliver officers’ certificates or procure the delivery of fairness opinions by accounting, appraisal or investment banking firms to the trustee of the Notes for any such transactions.

The liquidity and price of the Notes following the offering may be volatile.

The price and trading volume of the Notes may be highly volatile. Factors such as variations in our revenues, earnings and cash flows, proposals for new investments, strategic alliances and acquisitions, changes in interest rates, fluctuations in price for comparable companies, government regulations and changes thereof applicable to our industry and general economic conditions nationally or internationally could cause the price of the Notes to change. Any such developments may result in large and sudden changes in the trading volume and price of the Notes.

There may be less publicly available information about us than is available in certain other jurisdictions.

There may be less publicly available information about companies listed in Hong Kong than is regularly made available by public companies in certain other countries. In addition, the financial information in this offering memorandum has been prepared in accordance with HKFRSs, which differ in certain respects from generally accepted accounting principles in other jurisdictions, or other GAAPs, which might be material to the financial information contained in this offering memorandum. We have not prepared a reconciliation of our consolidated financial statements and related footnotes between HKFRSs and other GAAPs. In making an investment decision, you must rely upon your own examination of us, the terms of the offering and our financial information. You should consult your own professional advisers for an understanding of the differences between HKFRSs and other GAAPs and how those differences might affect the financial information contained in this offering memorandum.

We will follow the applicable corporate disclosure standards for debt securities listed on the SGX-ST, which standards may be different from those applicable to companies in certain other countries.

We will be subject to reporting obligations in respect of the Notes to be listed on the SGX-ST. The disclosure standards imposed by the SGX-ST may be different than those imposed by securities exchanges in other countries or regions such as Hong Kong. As a result, the level of information that is available may not correspond to what investors in the Notes are accustomed to.

Risks Relating to the Guarantees and the Collateral

Our initial Subsidiary Guarantors do not currently have significant operations and certain Subsidiary Guarantees may in some cases be replaced by limited-recourse guarantees.

We conduct substantially all of our business operations through our PRC subsidiaries, but none of our current PRC subsidiaries will provide a guarantee of the Notes either upon issuance of the Notes or at any time thereafter. No future subsidiaries that are organized under the laws of PRC will provide a guarantee of the Notes at any time in the future. As a result, the Notes will be effectively subordinated to all existing and future debt and other obligations, including contingent obligations and trade payables, of the PRC subsidiaries. Moreover, the Collateral will not include the capital stock of our existing or future Non-Guarantor Subsidiaries, including our PRC subsidiaries.

The initial Subsidiary Guarantors that will guarantee the Notes are holding companies that do not have significant operations. We cannot assure you that the initial Subsidiary Guarantors or any subsidiaries that may become guarantors in the future will have the funds necessary to satisfy our financial obligations under the Notes if we are unable to do so.

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In addition, a guarantee required to be provided by a subsidiary under the terms of the Notes may be replaced by a limited-recourse JV Subsidiary Guarantee following the sale or issuance to a third party of a minority interest in such subsidiary (subject to the satisfaction of certain conditions including a cap on the non-guaranteed portion of the assets of JV Subsidiary Guarantors). Recovery under a JV Subsidiary Guarantee is limited to an amount equal to our proportional interest in the issued share capital of such JV Subsidiary Guarantor multiplied by the fair market value of the total assets in such JV Subsidiary Guarantor and its subsidiaries, on a consolidated basis, as of the date of the last fiscal year end. A Subsidiary Guarantor may also be able to release its Subsidiary Guarantee if we sell or issue no less than 20% of the capital stock of such Subsidiary Guarantor, as long as the consolidated assets of all Restricted Subsidiaries organized outside the PRC that are not Subsidiary Guarantors or JV Subsidiary Guarantors do not account for more than 15.0% of our total assets.

The Subsidiary Guarantees or JV Subsidiary Guarantees may be challenged under applicable insolvency or fraudulent transfer laws, which could impair the enforceability of the Subsidiary Guarantees or JV Subsidiary Guarantees.

Under bankruptcy laws, fraudulent transfer laws, insolvency or unfair preference or similar laws in the Cayman Islands, Hong Kong and other jurisdictions where future Subsidiary Guarantors or JV Subsidiary Guarantors (if any) may be established, a guarantee could be voided, or claims in respect of a guarantee could be subordinated to all other debts of that guarantor if, among other things, the guarantor, at the time it incurred the indebtedness evidenced by, or when it gives, its guarantee:

incurred the debt with the intent to hinder, delay or defraud creditors or was influenced by a desire to put the beneficiary of the guarantee in a position which, in the event of the guarantor’s insolvency, would be better than the position the beneficiary would have been in had the guarantee not been given;
received less than reasonably equivalent value or fair consideration for the incurrence of such guarantee;
was insolvent or rendered insolvent by reason of the incurrence of such guarantee;
was engaged in a business or transaction for which the guarantor’s remaining assets constituted unreasonably small capital; or
intended to incur, or believed that it would incur, debts beyond its ability to pay such debts as they mature.

The measure of insolvency for purposes of the foregoing will vary depending on the laws of the applicable jurisdiction. Generally, however, a guarantor would be considered insolvent at a particular time if it were unable to pay its debts as they fell due or if the sum of its debts was then greater than all of its properties at a fair valuation or if the present fair salable value of its assets was then less than the amount that would be required to pay its probable liabilities in respect of its existing debts as they became absolute and matured.

In addition, a guarantee may be subject to review under applicable insolvency or fraudulent transfer laws in certain jurisdictions or subject to a lawsuit by or on behalf of creditors of the guarantor. In such case, the analysis set forth above would generally apply, except that the guarantee could also be subject to the claim that, since the guarantee was not incurred for the benefit of the guarantor, the obligations of the guarantor thereunder were incurred for less than reasonably equivalent value or fair consideration.

In an attempt to limit the applicability of insolvency and fraudulent transfer laws in certain jurisdictions, the obligations of the Subsidiary Guarantors or the JV Subsidiary Guarantors (if any) under the Subsidiary Guarantees or the JV Subsidiary Guarantees (as the case may be) will be limited to the maximum amount that can be guaranteed by the applicable Subsidiary Guarantor or JV Subsidiary Guarantor without rendering the guarantee, as it relates to such Subsidiary Guarantor or JV Subsidiary Guarantor, voidable under such applicable insolvency or fraudulent transfer laws.

If a court voids a Subsidiary Guarantee or JV Subsidiary Guarantee (as the case may be), subordinates such guarantee to other indebtedness of the Subsidiary Guarantor or JV Subsidiary Guarantor (as the case may be) or holds such guarantee unenforceable for any other reason, holders of the Notes would cease to have a claim

– 42 –

against that Subsidiary Guarantor or JV Subsidiary Guarantor based upon such guarantee, would be subject to the prior payment of all liabilities (including trade payables) of such Subsidiary Guarantor or JV Subsidiary Guarantor (as the case may be), and would solely be creditors of us and any Subsidiary Guarantors or JV Subsidiary Guarantors whose guarantees have not been voided or held unenforceable. We cannot assure you that, in such an event, after providing for all prior claims, there would be sufficient assets to satisfy the claims of the holders of the Notes.

The pledge of the Collateral may in some circumstances be voidable.

The pledge of the Collateral may be voidable as a preference under insolvency or fraudulent transfer or similar laws of Hong Kong and the Cayman Islands if created within the six months immediately preceding the commencement of a liquidation or, under some circumstances, within a longer period. Pledges of capital stock of future Subsidiary Guarantors may also be voidable as a preference under relevant insolvency or fraudulent transfer or similar laws. In addition, the pledge of certain Collateral may be voided based on the analysis set forth under the risk factor headed “– The Subsidiary Guarantees or the JV Subsidiary Guarantees may be challenged under applicable insolvency or fraudulent transfer laws, which could impair the enforceability of the Subsidiary Guarantees or the JV Subsidiary Guarantees” above.

If the pledges of the Collateral were to be voided for any reason, holders of the Notes would have only an unsecured claim against us and the Subsidiary Guarantor.

The value of the Collateral will likely not be sufficient to satisfy our obligations under the Notes and other pari passu secured indebtedness.

The Collateral will consist only of the capital stock of the Subsidiary Guarantors. The security interest in respect of certain Collateral may be released upon the disposition of such Collateral and any proceeds from such disposition may be applied, prior to repaying any amounts due under the Notes, to repay other debt or to make investments in properties and assets that will not be pledged as additional Collateral.

The ability of the Trustee, on behalf of the holders of the Notes, to foreclose on the Collateral upon the occurrence of an event of default or otherwise will be subject in certain instances to perfection and priority status. Although procedures will be undertaken to support the validity and enforceability of the security interests, we cannot assure you that the Trustee or holders of the Notes will be able to enforce such security interest.

The value of the Collateral in the event of a liquidation will depend upon market and economic conditions, the availability of buyers and similar factors. No independent appraisals of any of the Collateral have been prepared by or on behalf of us in connection with this offering of the Notes. Accordingly, we cannot assure you that the proceeds of any sale of the Collateral following an acceleration of the Notes would be sufficient to satisfy, or would not be substantially less than, amounts due and payable on the Notes. By its nature, the Collateral, which consists solely of the capital stock of any existing or future Subsidiary Guarantor, is likely to be illiquid and is unlikely to have a readily ascertainable market value. Likewise, we cannot assure you that the Collateral will be salable or, if salable, that there will not be substantial delays in its liquidation.

The Collateral will be shared on a pari passu basis by the holders of the Notes, the holders of the January 2018 Notes and the holders of the April 2016 Notes and may be shared on a pari passu basis with holders of other indebtedness ranking pari passu with the Notes that we may issue in the future. Accordingly, in the event of a default on the Notes or the other secured indebtedness and a foreclosure on the Collateral, any foreclosure proceeds would be shared by the holders of secured indebtedness in proportion to the outstanding amounts of each class of such secured indebtedness. The value of the Collateral securing the Notes and the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors is unlikely to be sufficient to satisfy the obligations of the Company and each of the Subsidiary Guarantor Pledgors under the Notes and the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors, and the Collateral securing the Notes and such Subsidiary Guarantees may be reduced or diluted under certain circumstances, including the issuance of Additional Notes or other pari passu indebtedness and the disposition of assets comprising the Collateral, subject to the terms of the indenture.

– 43 –

The pledge of certain Collateral may be released under certain circumstances.

In the event the conditions applicable to the replacement of a Subsidiary Guarantee with a JV Subsidiary Guarantee are satisfied, we are permitted to release the pledge of the shares granted by such Subsidiary Guarantor, as well as the pledge of the shares granted by the subsidiaries of such Subsidiary Guarantor. We are only required to deliver a replacement share pledge for the shares that we continue to hold in such JV Subsidiary Guarantor (but not the subsidiaries of such JV Subsidiary Guarantor) following the sale of the equity interests in such Subsidiary Guarantor. As a result, in the event we sell minority equity interests in our Subsidiary Guarantors or otherwise create JV Subsidiary Guarantors in accordance with the terms of the indenture governing the Notes, the Collateral will be reduced in value and scope, and holders of the Notes would be subject to increased risks.

– 44 –

USE OF PROCEEDS

We estimate that the net proceeds from this offering, after deducting the underwriting discounts and commissions and other estimated expenses payable in connection with this offering, will be approximately US$341.6 million. We intend to use the net proceeds to repay certain of our existing indebtedness, fund the acquisition of land for residential and commercial property development and for general corporate purposes.

Pending application of the net proceeds of this offering, we intend to invest such net proceeds in “Temporary Cash Investments” as defined under the section headed “Description of the Notes.”

We may adjust our development plans in response to future events and developments, such as changes in general market conditions, the outlook for our industry and the demand for our properties, and our directors may reallocate the use of the proceeds with a view to obtaining the optimal benefit for us.

– 45 –

EXCHANGE RATE INFORMATION

Since 1994, the PBOC has set and publish a daily base exchange rate with reference primarily to the supply and demand of Renminbi in the market during the previous day. On July 21, 2005, the PRC government introduced a managed floating exchange rate system to allow the value of the Renminbi to fluctuate within a regulated band based on market supply and demand and by reference to a basket of currencies. The PBOC has authorized the China Foreign Exchange Trading Centre to announce the Renminbi’s closing price each day, and that rate serves as the midpoint of the next day’s trading band. In 2007, the PBOC widened the daily trading band of the Renminbi against the U.S. dollar from 0.3% to 0.5%. As a result, the Renminbi is now permitted to rise or fall 0.5% each day from the midpoint set each morning. The PRC government may make further adjustments to the exchange rate system in the future.

The following table sets forth the noon buying rate for U.S. dollars in New York City for cable transfer in Renminbi as certified for customs purposes by the Federal Reserve Bank of New York for 2008 and the H.10 weekly statistical release of the Federal Reserve Board for the periods from and after January 1, 2009:

		Noon Buying Rate	Noon Buying Rate

Period	End	Average(1)	High	Low

		(RMB per	US$1.00)
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.8259	6.8295	6.8470	6.8176
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.6000	6.7603	6.8330	6.6000
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2939	6.4475	6.6364	6.2939
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2301	6.2990	6.3879	6.2221
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.0537	6.1412	6.2438	6.0537
2014
January . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.0590	6.0509	6.0600	6.0402
February . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.1448	6.0816	6.1448	6.0591
March . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2164	6.1729	6.2273	6.2108
April . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2591	6.2246	6.2591	6.1966
May. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2471	6.2380	6.2591	6.2255
June . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6.2030	6.2306	6.2548	6.2036
July (through July 3, 2014) . . . . . . . . . . . . .	6.2115	6.2070	6.2115	6.1995

(1) Annual averages have been calculated from month-end rate. Monthly averages have been calculated using the average of the daily rates during the relevant period.

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CAPITALIZATION AND INDEBTEDNESS

The following table sets forth our consolidated cash and cash equivalents, current borrowings and total capitalization as of December 31, 2013:

on an actual basis; and
on an adjusted basis to give effect to the issuance of the Notes and receipt of the net proceeds for this offering after deducting the underwriting discounts and commissions and other estimated expenses of this offering payable by us.

		As of December 31, 2013	As of December 31, 2013

	Actual		As Adjusted

	RMB	US$(1)	RMB	US$(1)
		(unaudited)	(unaudited)
		(in millions)
Cash and cash equivalents(2) . . . . . . . . . . . . . .	7,411.7	1,224.3	9,479.3	1,565.9

Current borrowings
Bank borrowings, secured
– due within one year . . . . . . . . . . . . . . . . . .	2,174.5	359.2	2,174.5	359.2

Non-current borrowings
Bank borrowings, secured
– due after one year . . . . . . . . . . . . . . . . . . .	8,648.0	1,428.6	8,648.0	1,428.6
Senior notes due January 2018 . . . . . . . . . . . .	1,189.2	196.4	1,189.2	196.4
Senior notes due April 2016 . . . . . . . . . . . . . . The Notes to be issued(3) . . . . . . . . . . . . . . . . .	1,477.9 –	244.1 –	1,477.9 2,067.6	244.1 341.6
Non-current, unsecured and borrowed
from a bank . . . . . . . . . . . . . . . . . . . . . . . . . .	400.0	66.1	400.0	66.1

Total non-current borrowings . . . . . . . . . . . . Total equity(4) . . . . . . . . . . . . . . . . . . . . . . . . . Total capitalization(5) . . . . . . . . . . . . . . . . . . .	11,715.1 10,598.0 22,313.1	1,935.2 1,750.7 3,685.9	13,782.7 10,598.0 24,380.7	2,276.8 1,750.7 4,027.5

(1) All translations from Renminbi into U.S. dollars, and vice versa, were made at the rate of RMB6.0537 to US$1.00, which was the noon buying rate as certified for custom purposes by the H.10 weekly statistical release of the Federal Reserve Board for cable transfers for Renminbi on December 31, 2013.

(2) Cash and cash equivalents excludes restricted cash of RMB886.2 million.

(3) In accordance with HKFRSs, the Notes should be recorded at their fair value upon initial recognition, which may be substantially different from the aggregate principal amount of the Notes. For illustrative purposes only, the Notes have been recorded at their aggregate principal amount, after deducting the underwriting discounts and commissions and other estimated expenses of this offering payable by us, in the “As adjusted” column of the table above.
(4) The as-adjusted information takes no account of the final dividend in respect of the year ended December 31, 2013 amounting to approximately RMB283,400,000. The dividend was proposed by the directors at the Company’s Board meeting held on March 17, 2014, and was approved by the shareholders at the forthcoming annual general meeting of the Company held on May 21, 2014. Equity was reduced when the dividend was paid in late June 2014.
(5) Total capitalization is calculated as total non-current borrowings plus total equity.

Since December 31, 2013, we have settled the outstanding balance of RMB2,267.9 million on certain bank borrowings and had additional bank borrowings in the amount of RMB3,122.0 million, up to May 31, 2014. Except the foregoing, there has been no material adverse change in our indebtedness or capitalization since December 31, 2013. See “Description of Material Indebtedness and Other Obligations”.

1 We have RMB125.0 million on deposit with Jiangsu International Trust Corporation Limited which can be used to set off the outstanding amount of such trust loans.

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SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following tables set forth our selected financial and other data. The selected consolidated statements of income data for the years ended December 31, 2011, 2012 and 2013 and the selected consolidated statements of financial position data as of December 31, 2011, 2012 and 2013 set forth below (except for EBITDA data and amounts presented in U.S. dollars) have been derived from the Accountant’s Report and our audited consolidated financial statements as of and for the years ended December 31, 2012 and 2013 as audited by PricewaterhouseCoopers, Certified Public Accountants, Hong Kong.

The financial information included in the Accountant’s Report and our consolidated financial statements as of and for the years ended December 31, 2012 and 2013 have been prepared and presented in accordance with HKFRSs, which differ in certain respects from generally accepted accounting principles in other jurisdictions. You should read the selected financial data below in conjunction with the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, the Accountant’s Report, our audited consolidated financial statements and the notes to those statements. Historical results are not necessarily indicative of future results.

Selected Consolidated Statements of Income and Other Financial Data

		Year ended	December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)	(US$)
				(unaudited)
		(in thousands)
Revenue. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10,767,254	17,517,266	20,771,255	3,431,167
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . .	(7,743,687)	(13,587,371) (16,088,038)		(2,657,555)

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,023,567	3,929,895	4,683,217	773,612
Fair value gains on investment properties. . . .	273,493	31,086	37,839	6,251
Selling and marketing costs . . . . . . . . . . . . . . .	(388,091)	(474,921) (592,032)		(97,797)
Administrative expenses . . . . . . . . . . . . . . . . . .	(465,941)	(569,883) (680,028)		(112,333)
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . .	39,493	9,475	151,674	25,055
Other expenses. . . . . . . . . . . . . . . . . . . . . . . . . .	(20,240)	(4,347) (4,152)		(686)
Other gains – net. . . . . . . . . . . . . . . . . . . . . . . .	58,076	13,626	46,270	7,643
Operating profit. . . . . . . . . . . . . . . . . . . . . . . .	2,520,357	2,934,931	3,642,788	601,746
Finance costs – net . . . . . . . . . . . . . . . . . . . . . .	(135,142)	(111,660) (394,900)		(65,233
Share of results of an associated company . . .	−	(5,110) (11,422)		(1,887)
Profit before income tax. . . . . . . . . . . . . . . . .	2,385,215	2,818,161	3,236,466	534,626
Income tax expense. . . . . . . . . . . . . . . . . . . . . .	(941,284)	(1,232,777) (1,519,329)		(250,975)
Profit for the year. . . . . . . . . . . . . . . . . . . . . .	1,443,931	1,585,384	1,717,137	283,651

Attribute to:
Equity holders of the Company . . . . . . . . . . . .	886,886	930,819	981,262	162,093
Non-controlling interests. . . . . . . . . . . . . . . . . .	557,045	654,565	735,875	121,558

Other Financial Data (unaudited)
EBITDA(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2,605,018	3,638,945	4,339,993	716,916

EBITDA margin(2) . . . . . . . . . . . . . . . . . . . . . . .	24.2%	20.8%	20.9%

(1) EBITDA refers to our operating profit plus depreciation, amortization and capitalized interest under cost of sales, but excluding fair value gains on the investment properties and net gains or losses. EBITDA is not a standard measure under HKFRSs. EBITDA is a widely used financial indicator of a company’s ability to service and incur debts. EBITDA should not be considered in isolation or construed as an alternative to cash flows, net income or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. EBITDA does not account for taxes, interest expense or other non-operating items. In evaluating EBITDA, we believe that investors should consider, among other things, the components of EBITDA such as sales and operating expenses and the amount by which EBITDA exceeds capital expenditures and other charges. We have included EBITDA because we believe it is a useful supplement to cash flow data as a measure of our performance and our ability to generate cash flow from operations to cover debt service and taxes. EBITDA presented herein may not be comparable to similarly titled measures presented by other companies. Investors should not compare our EBITDA to EBITDA presented by other companies because not all companies use the same definition. See the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures” for a reconciliation of our profit for the year under HKFRSs to our definition of EBITDA. Investors should also note that EBITDA as presented herein may be calculated differently from Consolidated EBITDA as defined and used in the indenture governing the Notes. See the section headed “Description of the Notes – Definitions” for a description of the manner in which Consolidated EBITDA is defined for purposes of the Indenture.

(2) EBITDA margin is calculated by dividing EBITDA by revenue.

– 48 –

Selected Consolidated Statements of Financial Position Data

		As of December 31,	As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)	(US$)
				(unaudited)
		(in thousands)
ASSETS
Non-current assets
Property, plant and equipment . . . . . . . . . . .	117,016	117,074	116,009	19,163
Investment properties . . . . . . . . . . . . . . . . . .	2,443,200	3,105,600	3,307,000	546,277
Intangible assets . . . . . . . . . . . . . . . . . . . . . .	5,341	7,267	9,836	1,625
Investments in associates . . . . . . . . . . . . . . .	235,000	229,890	43,468	7,180
Investment in a joint venture . . . . . . . . . . . .	−	−	10,000	1,652
Deferred income tax assets . . . . . . . . . . . . .	362,640	361,193	499,738	82,551
Available-for-sale financial assets . . . . . . . .	156,000	181,187	221,187	36,537
Land use rights . . . . . . . . . . . . . . . . . . . . . . .	367,248	367,248	367,248	60,665
Other receivables . . . . . . . . . . . . . . . . . . . . .	−	−	198,538	32,796

	3,686,445	4,369,459	4,773,024	788,447

Current assets
Prepayments for leasehold land . . . . . . . . . .	2,689,155	4,313,847	3,285,498	542,726
Properties held or under development
for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . .	24,227,066	24,493,752	28,728,964	4,745,687
Trade and other receivables and
prepayments . . . . . . . . . . . . . . . . . . . . . . .	1,761,606	1,666,266	2,112,831	349,015
Restricted cash . . . . . . . . . . . . . . . . . . . . . . .	314,536	1,148,089	886,180	146,387
Cash and cash equivalents . . . . . . . . . . . . . .	4,221,558	4,852,130	7,411,713	1,224,328
	33,213,921	36,474,084	42,425,186	7,008,141

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .	36,900,366	40,843,543	47,198,210	7,796,589

OWNERS’ EQUITY
Capital and reserves attributable to equity
holders of the Company
Issued and fully paid capital. . . . . . . . . . . . .	3,466	4,617	4,617	763
Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,176,350	5,746,486	6,717,031	1,109,574

	3,179,816	5,751,103	6,721,648	1,110,337
Non-controlling interests . . . . . . . . . . . . . . . .	2,022,133	2,643,924	3,876,311	640,321
Total equity. . . . . . . . . . . . . . . . . . . . . . . . . . . .	5,201,949	8,395,027	10,597,959	1,750,658
LIABILITIES
Non-current liabilities
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . .	6,649,200	4,509,670	11,715,075	1,935,193
Deferred income tax liabilities . . . . . . . . . .	343,237	402,872	432,922	71,514

Current liabilities
Trade and other payables . . . . . . . . . . . . . . .	6,627,089	9,597,029	10,368,476	1,712,750
Advances from pre-sale of properties . . . . .	12,775,020	11,663,869	10,235,042	1,690,708
Current income tax liabilities . . . . . . . . . . .	1,085,703	1,143,835	1,673,306	276,410
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . .	4,217,363	5,130,436	2,174,501	359,202
Dividends payable . . . . . . . . . . . . . . . . . . . . .	805	805	929	153
	24,705,980	27,535,974	24,452,254	4,039,225

Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . .	31,698,417	32,448,516	36,600,251	6,045,931

Total equity and liabilities. . . . . . . . . . . . . . .	36,900,366	40,843,543	47,198,210	7,796,589

– 49 –

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations should be read in conjunction with the Accountant’s Report and our consolidated financial statements as of and for the year ended December 31, 2011, 2012 and 2013, in each case, the related notes thereto included elsewhere in this offering memorandum. The financial information included in the Accountant’s Report and our consolidated financial statements as of and for the year ended December 31, 2011, 2012 and 2013 have been prepared in accordance with HKFRSs, which may differ in material aspects from generally accepted accounting principles in other jurisdictions. For the purpose of this section unless the context otherwise requires references to 2011, 2012 and 2013 refer to our financial year ended December 31 of that year.

The following discussion and analysis contains forward-looking statements that involve risks and uncertainties. Our actual results and timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” in this offering memorandum.

Overview

(1) China Index Academy derived the information in the report from its self-developed database, CREIS China Index Database and the database of fdc.soufun.com. These databases, which comprise data from the Housing Administration Real Estate Exchanges Centres of Jiangsu Province, Changzhou and Shanghai and the annual reports and corporate returns of listed real estate companies, have been widely used and relied upon in the PRC property market.

(2) Asset turnover ratio is calculated by dividing revenue during a given year, by the average of total assets at the beginning and the end of the year.

– 50 –

Basis of Presentation

The consolidated financial statements have been prepared in accordance with HKFRSs under the historical cost convention as modified by the revaluation of available-for-sale financial assets and investment properties, which are carried at fair value. The reorganization we underwent for our IPO was accounted for using merger accounting, as all the companies comprising our Group were under the common control of Chairman Wang. The consolidated financial statements present the financial position, results of operations and cash flows of the companies comprising our Group as if the current group structure had been in existence since January 1, 2009, or for companies established after January 1, 2009, the later of their respective dates of establishment or the dates when they became controlled by Chairman Wang. The consolidated financial statements do not include the assets, liabilities and results of operations of certain entities that were not transferred to our Company pursuant to the reorganization on the basis that those entities were involved in businesses unrelated to property development, have separate management personnel and accounting records and have been independently financed and operated.

Principal Factors Affecting our Results of Operations

Our business, results of operations and financial condition are affected by a number of factors, including those set forth below.

Macroeconomy of PRC and Regulatory Measures for the Property Sector in China

Substantially all of our revenue has been generated from the commercial and residential property markets in the PRC. The conditions of the commercial and residential property markets in the PRC are significantly impacted by governmental policies and regulations.

From time to time, the PRC government adjusts its regulation of the property market depending on macroeconomic conditions to achieve policy goals, such as preventing the overheating of the property market or stimulating the property market during and after an economic downturn. In recent years, various administrative bodies launched a series of measures to discourage speculation and control the growth of the PRC property market. As a result of the introduction of the industry policies and measures to manage the potential overheating of the property sector, such as raising interest rates and bank reserve ratios, strengthening property purchase restrictions, increasing the supply of low-income housing units and increasing taxes and duties on property transfers in 2011, the sales volume and purchase prices in certain cities, including those in which we operate, experienced a decrease in the second half of 2011. Transaction volumes remained low and inventory levels of commodity properties remained high in the first half of 2012. In view of the challenging market conditions, we adapted our marketing and pricing strategy to focus our sales efforts on smaller-sized and lower-priced units that target the mass market segment, which is less impacted by property purchase restrictions. As a result of these adjustments, among other reasons, our gross profit margin decreased from 28.1% in 2011 to 22.4% in 2012 and may continue to be adversely affected in future periods when such properties are delivered. See “Business −PRC Government’s Measures to ‘Cool-Off’ the PRC Property Market”. The performance of the property market and our business will continue to be affected by a number of macroeconomic factors, including the growth of the PRC economy, interest rates, RMB exchange rate and the political, economic and regulatory environment in the PRC.

Our business and results of operations may be affected by governmental policies and regulations in the PRC relating to property development, including those that have (i) increased taxes on title transfers and property ownership, (ii) increased down payment requirements for residential mortgages, (iii) tightened credit on financing and mortgage loans and (iv) restricted multiple home ownership and investments in residential property outside one’s province of residence.

Ability to Acquire Suitable Land for Future Development

Our growth will depend in large part on our ability to acquire quality land at prices that can yield reasonable returns. In recent years, we have expanded our business geographically. Based on our current development plans, we have sufficient land reserves for development for the next three to five years. As the PRC economy continues to grow and demand for commercial and residential properties remains relatively strong, we expect competition among developers for land reserves suitable for property development to intensify nationwide and in the cities in which we operate. In addition, the public tender, auction and listing-for-sale practices for granting state-owned land use rights are also likely to increase competition for development land and land acquisition costs. See “Risk Factors – Risks Relating to Our Business – We may not be able to acquire land reserves in desirable locations that are suitable for development at commercially acceptable prices in the future.”

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Access to Capital and Cost of Financing

Bank and other borrowings are important sources of funding for our property developments. As of December 31, 2011, 2012 and 2013, our outstanding current and non-current bank loans amounted to RMB6,512.9 million, RMB7,452.8 million and RMB11,222.5 million, respectively. Our other current and non-current borrowings in the form of trust financing arrangements amounted to RMB4,353.7 million, RMB2,187.3 million and nil, respectively. As commercial banks in China link the interest rates on their loans to PBOC benchmark interest rates, any increase in such benchmark interest rates will increase our finance costs. While trust financing companies do not usually link their interest rates to the PBOC benchmark interest rates, they typically charge rates 3% to 7% higher than those charged by commercial banks. Our access to capital and cost of financing are also affected by restrictions imposed from time to time by the PRC government and by financial institutions on bank lending for property development. Additionally, an increase in the demand for loans may increase interest rates, resulting in additional interest costs for us, especially in newly raised loans. See “Risk Factors – Risks Relating to Our Business – We may not have adequate financing to fund our future land acquisitions and property developments, and such capital resources may not be available on commercially reasonable terms, or at all.”

Product Mix of Our Properties

We derive substantially all of our revenue from the sale of residential and commercial properties. Over the years, we have developed and introduced various products to the market, including large-scale residential properties and mixed-use complexes, which consist of high-end residential flats, retail properties and other properties. Our results of operations and cash flows generated from operating activities may vary from period to period depending on our sales strategy, the types of properties sold and delivered and the average selling prices of these properties. In addition, our results of operations and cash flows generated from operating activities may also vary depending on prevailing market conditions when we sell our properties. The cash flows generated from our investment properties depend on local rental rates, which in turn depend on local supply and demand conditions, as well as the type of property being developed.

Timing of Property Development

The number of property projects that we undertake during any particular period is primarily limited by the substantial capital requirements for land acquisitions and construction, as well as land supply. In addition, the development of property projects may take many months or even years before the commencement of pre-sale or completion and delivery. No revenue is recognized with respect to a property project until it has been completed, sold and delivered to the customers. In addition, as market demand fluctuates, the revenue we recognize in a particular period may also depend on market conditions at the expected completion and delivery time of a particular project. Moreover, delays in construction, regulatory approval and other processes can adversely affect the timetable of our projects. Given the foregoing limitations, timing differences and uncertainties, our results of operations have fluctuated in the past and are likely to continue to fluctuate in the future. To mitigate these fluctuations, we seek to strategically schedule projects so they will be staggered at different stages of development during any particular period.

Land and Construction Costs

Our results of operations are affected by land and construction costs. Land and construction costs constitute the largest items in our cost of sales. Over the years, land premiums have generally been on the rise in China. It is expected that land premiums will continue to rise as the PRC economy continues to grow and demolition and resettlement costs continue to increase. Under our standard construction contracts, we are responsible for key construction materials such as steel and bear any increases in material costs after a contract is entered into. Furthermore, prolonged increases in the price of construction materials will prompt contractors to change their fee quotes for new contracts, thus increasing our cost of sales and overall project cost. If we cannot sell our properties at prices sufficient to cover all our increased costs, we will not be able to achieve our target profit margins, and our profitability will be adversely impacted.

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LAT

Our property developments are subject to LAT with respect to the appreciated value of the related land and improvements on such land. LAT applies to both domestic and foreign investors in real estate development in China, and is levied at progressive rates ranging from 30% to 60% of the appreciation of land value. In 2011, 2012 and 2013, we recorded total LAT expenses of RMB388.2 million, RMB636.2 million and RMB866.6 million, respectively, in our consolidated statements of income. Provisions for LAT are made upon recognition of revenue. As of the date of this offering memorandum, we have made all prepayments and/or full provisions for LAT in compliance with the relevant LAT laws and regulations in China as interpreted and enforced by the relevant local tax authorities. However, we cannot assure you that the relevant tax authorities will agree to the basis on which we have calculated our LAT liabilities for provision purposes, or that such provisions will be sufficient to cover all LAT obligations that tax authorities may ultimately impose on us. Our financial condition and results of operations may be materially adversely affected if our LAT liabilities as calculated by the relevant tax authorities are substantially higher than our provisions. See “Risk Factors – Risks Relating to Our Business – The relevant PRC tax authorities may challenge the basis on which we calculate our LAT obligations.”

Fair Value of Investment Properties

We have designated certain completed properties and properties under development as investment properties, as we intend to hold these properties on a long-term basis for rental income and capital appreciation. Our investment properties are recorded as non-current assets in our consolidated statements of financial position at fair value as of each balance sheet date as determined by independent valuations. Gains or losses arising from changes in the fair value of our investment properties are accounted for as gains or losses upon revaluation in our consolidated statements of income, which may have a substantial effect on our profits. The valuation of property involves the exercise of professional judgment and requires the use of certain bases and assumptions. The fair value of our investment properties may have been higher or lower if a different set of bases or assumptions were to be used. In addition, upward revaluation adjustments reflect unrealized capital gains on our investment properties as of the relevant balance sheet dates and do not generate any cash inflow for our operations or potential dividend distributions to our shareholders. The amounts of fair value adjustments have been changed and may continue to change based on property market conditions in China and our portfolio of investment properties. In 2012 and 2013, we recorded fair value gains of RMB31.1 million and RMB37.8 million, respectively, while we recorded fair value gains of RMB273.5 million in 2011. We recognized substantial gains from fair value changes in our investment properties in 2011, but we cannot assure you that similar levels of fair value gains can be achieved in the future.

Critical Accounting Policies

Some of our accounting policies require subjective or complex judgments by our management, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Certain accounting estimates are particularly sensitive because of their significance to our consolidated financial statements. We review our estimates and underlying assumptions on an ongoing basis. We set forth below those accounting policies that we believe are the most critical to our consolidated financial statements.

Revenue Recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of properties and services in the ordinary course of our activities. Revenue is shown net of returns, rebates and discounts and after eliminated sales within our Group. Revenue is recognized as follows:

(a) Revenue from sales of properties is recognized when the risks and rewards of the properties are transferred to the purchasers, which is when the construction of relevant properties has been completed and the properties have been delivered to their respective purchasers pursuant to the sales agreement, assuming the collectibility of the related receivables is reasonably assured. Deposits and installments received on pre-sales of properties sold prior to delivery are included in the consolidated statements of financial position as cash with a corresponding amount recorded as “advances from pre-sales of properties” under current liabilities.
(b) Rental income from properties leased under operating leases is recognized on a straight line basis over the relevant lease terms.

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(c) Revenue from services is recognized when services have been provided, total amount of revenue and costs can be estimated reliably and the collectibility of the related receivables is reasonably assured.
(d) Interest income is recognized on a time-proportion basis using the effective interest method. When a receivable is impaired, we reduce the carrying amount to its recoverable amount, being the estimated future cash flows discounted at the original effective interest rate of the instrument, and continue unwinding the discount as interest income. Interest income on impaired loans and receivables is recognized using the original effective interest rate.

Investment Properties

Properties that we do not occupy and hold for long-term rental yields or capital appreciation, or both, are classified as investment properties. Properties that are currently being constructed or developed for future use as investment properties are also classified as investment properties and stated at fair value. An investment property is measured initially at cost, including related transaction costs and, where applicable, borrowing costs. After initial recognition, an investment property is carried at fair value. Fair value assessments are based on active market prices and are adjusted, as necessary, for any difference in the nature, location or condition of the specific asset. If this information is not available, we use alternative valuation methods such as recent prices in less active markets or discounted cash flow projections. These valuations are performed at each balance sheet date by external valuers.

Properties Held or Under Development for Sale

Properties held or under development for sale are included in current assets at the lower of cost and net realizable value. The costs of properties held or under development consist of costs of leasehold land, construction expenditure, capitalized borrowing costs and other direct costs incurred during the development period. The costs of properties held are determined by apportionment of the total development costs for that development project attributable to the unsold properties. Net realizable value is based on estimated selling price in the ordinary course of business as determined by management with reference to prevailing market conditions, less further costs expected to be incurred before completion and expected selling and marketing costs.

Borrowings Costs

Borrowing costs are capitalized if they are directly attributable to the development of properties for sale or the acquisition, construction or production of other qualifying assets. Capitalization of borrowing costs commences when the activities to prepare the assets commence and expenditure and borrowing costs are incurred, and capitalization ceases when the assets are substantially completed or ready for their intended use. Other borrowing costs are expensed in the period they are incurred.

Deferred Income Tax

Deferred income tax is recognized, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred income tax assets are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized.

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Certain Income Statement Items

Revenue

We derive our revenue primarily from sales of properties and, to a lesser extent, property management, rental income and other property-related services. The following table sets forth our revenue by revenue source for the years indicated.

				Year ended December	31,

			2011	2012	2013

			(RMB)	(RMB)	(RMB)
				(in thousands)
Revenue
Sales of properties . . . . . . . . . . . . . . . . . . . . . . . . . . .			10,688,562	17,341,932	20,421,811
Property management		. . . . . . . . . . . . . . . . . . . . . . . .	72,088	121,469	182,501
Rental income	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		4,960	35,620	102,356
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			1,644	18,245	64,587

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			10,767,254	17,517,266	20,771,255

As we derive substantially all of our revenue from sales of properties, our results of operations for a given period are dependent upon the amount of total salable GFA, the location and type of properties we completed and delivered during such period, market conditions and the contracted sales price of our properties.

The table below sets forth, by property type, the total salable GFA that we delivered and ASP for each type of property during the years indicated:

			Residential			Commercial(1)

		Revenue	GFA	ASP	Revenue	GFA	ASP

		(RMB’000)	(sq.m.)	(RMB/sq.m.)	(RMB’000)	(sq.m.)	(RMB/sq.m.)
2011	. . . . . . . . . . . . .	9,576,635	1,288,019	7,435	1,111,927	108,897	10,211
2012	. . . . . . . . . . . . .	15,446,775	1,779,081	8,682	1,895,156	138,829	13,651
2013	. . . . . . . . . . . . .	18,337,286	2,293,376	7,996	2,084,525	181,722	11,471

(1) Includes retail and commercial areas in residential projects and commercial properties in mixed-use complex projects.

Our recognized ASP was RMB7,652 per sq.m., RMB9,069 per sq.m. and RMB 8,251 per sq.m. for the years ended December 31, 2011, 2012 and 2013, respectively.

Cost of Sales

Cost of sales consists primarily of the costs we incur directly in relation to our property development activities as well as our leasing and property management operations. Cost of sales includes construction costs, land use rights costs, business tax and surcharges, capitalized interest and other business costs.

Construction costs . These represent costs for the design and construction of a property project and consist primarily of fees paid to our contractors, including those responsible for civil engineering, construction, landscaping, equipment installation and interior decoration, as well as infrastructure construction costs and design costs. Our construction costs are affected by a number of factors such as the cost of construction materials, the location and type of properties being constructed and investments in ancillary facilities.
Land use rights costs . These represent costs relating to acquisition of the rights to occupy, use and develop land, including land grant fees, demolition and resettlement costs, and other land related taxes. These costs for a project are influenced by a number of factors, including the location of the underlying property, market conditions, the project’s plot ratios, the designated use of the underlying property, our method of acquisition and changes in PRC regulations.

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Business tax and surcharges . Our operating subsidiaries in the PRC are subject to business tax on their revenues and surcharges. Sales of properties are subject to a 5% business tax. Surcharges vary by city.
Capitalized interest . We capitalize a portion of our borrowing costs to the extent that such costs are directly attributable to the development of a particular project. Costs that are not directly attributable to the development of a project are expensed and recorded as finance costs in our consolidated statements of income and therefore fluctuations in the amount of our borrowing costs that can be capitalized from period to period will affect our finance costs.
Other costs . We incur other business costs primarily in relation to our leasing and property management operations, including a 5% business tax on the leasing of investment properties and the provision of property management services.

Our development costs, which consist of construction costs, land use rights costs and capitalized interest, increased from RMB6,673.3 million in 2011 to RMB12,442.6 million in 2012 and further to RMB14,642.8 million in 2013. The increase in development costs in recent years was primarily due to (i) an increase in construction costs as a result of the construction of more fully fitted-out properties with interior decoration, (ii) an increase in land use rights costs, and (iii) a higher percentage of properties being delivered in Shanghai starting in 2011, which incurred higher overall costs.

Our accrual of provision for properties held (or under development) for sale represents the impairment charge we made in connection with certain properties held (or under development) for sale. For the years ended December 31, 2011, 2012 and 2013, our accrual of provision for properties held (or under development) for sale charged into our consolidated statements of income was RMB398.7 million, nil and RMB79.6 million. As market value for car parking space varies across different locations and projects, the estimated recoverable amounts for certain car parking spaces in certain projects fell below the respective development costs. As a result, we incurred impairment loss for our car parking spaces of RMB95.2 million, nil and RMB79.6 million for the years ended December 31, 2011, 2012 and 2013, respectively. Furthermore, in response to downward pricing pressures in the PRC property market starting in the second half of 2011, we made impairment charges in connection with certain properties held (or under development) for sale based on an in-depth review of the average selling price of properties in areas where our projects under development are located. We believed that, as of December 31, 2011, the market price, and correspondingly the total recoverable amounts, of the properties comprising our Future Land Consequence Project in Changzhou and our Legend Mansion Project in Shanghai were lower than the respective carrying amounts of such properties. Accordingly, in 2011 we recorded a total impairment loss of RMB85.0 million in connection with Future Land Consequence and RMB218.5 million in connection with Legend Mansion. Upon recognition of the sales of properties in 2012 and 2013 for which impairment provision had been made previously, we reversed impairment provision of RMB133.0 million and RMB160.8 million in 2012 and 2013, respectively, and credited to cost of sales.

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The following table sets forth information relating to our cost of sales for the years indicated:

			Year ended December 31,	Year ended December 31,

	2011		2012		2013

	(RMB)	(%)	(RMB)	(%)	(RMB)	(%)
			(in thousands)
Development Costs
Construction costs . . . . .	4,640,411.0	59.9	7,684,444.0	56.6	9,101,315.0	56.6
Land use rights costs . . .	1,634,569.0	21.1	4,025,794.0	29.6	4,770,651.0	29.7
Capitalized interest. . . . .	398,288.0	5.2	732,328.0	5.4	770,865.0	4.8
	6,673,268.0	86.2	12,442,566.0	91.6	14,642,831.0	91.0
Staff costs . . . . . . . . . . . . . .	61,105.0	0.8	114,642.0	0.8	164,521.0	1.0
Accrual of provision for
properties held
for sale . . . . . . . . . . . . . .	398,726.0	5.1	–	–	79,588.0	0.5
Other costs . . . . . . . . . . . . .	10,073.0	0.1	52,183.0	0.4	34,792.0	0.2

	469,904.0	6.0	166,825.0	1.2	278,901.0	1.7
Business tax and
surcharges . . . . . . . . . . . .	600,515.0	7.8	977,980.0	7.2	1,166,306.0	7.2
Total . . . . . . . . . . . . . . . . . .	7,743,687.0	100.0	13,587,371.0	100.0	16,088,038.0	100.0

Total GFA delivered
(sq.m.) . . . . . . . . . . . . . .	1,396,916.0		1,912,223.0		2,475,098.0
Average cost per sq.m.
sold (RMB)(1) . . . . . . . . .	4,777.0		6,507.0		5,916.0
Average selling price per
sq.m. sold (RMB)(1) . . . .	7,652.0		9,069.0		8,251.0
Average cost as % of
average selling price . . .	62.4		71.7		71.7

(1) Average cost per sq.m. sold refers to the average cost of our property sales (excluding our leasing and property management operations) and is derived by dividing the sum of construction costs, land use rights costs and capitalized interest for a year by the total GFA delivered in that year. The average selling price per sq.m. sold refers to the average selling price of GFA delivered and recognized as sales during the year.

Gross Profit and Gross Profit Margin

Gross profit represents revenue less cost of sales. Our gross profit for the years ended December 31, 2011, 2012 and 2013 was RMB3,023.6 million, RMB3,929.9 million and RMB4,683.2 million, respectively. Our gross profit margin for the years ended December 31, 2011, 2012 and 2013 was 28.1%, 22.4% and 22.5%, respectively.

We incurred significant interest expenses in relation to our bank borrowings, trust financing arrangements and senior notes. Our capitalized interests included in cost of sales were approximately RMB398.3 million, RMB732.3 million and RMB770.9 million for the years ended December 31, 2011, 2012 and 2013, respectively. Most of our interest expenses have been or will be capitalized as properties under development rather than being recorded as expenses in our income statement upon their incurrence. Such capitalized interest expenses will be recorded as expenses in our consolidated income statements as a portion of cost of sales upon the sale of the relevant properties. Accordingly, such capitalized interest expenses may adversely affect our gross profit margin upon recognition of the sale of the relevant properties in future periods. The amount of borrowing costs capitalized in connection with properties under development and properties held for sale for the years ended December 31, 2011, 2012 and 2013 was RMB788.2 million, RMB776.0 million and RMB683.0 million, respectively.

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Fair Value Gains on Investment Properties

We develop and hold certain of our commercial properties such as retail shops, shopping malls and car parks for rental income or capital appreciation. Our investment properties are appraised annually by an independent property valuer. Any appreciation or depreciation in our investment property value is recognized as fair value gains or losses in our consolidated statements of income. The fair value gains on investment properties for the years ended December 31, 2011, 2012 and 2013 were RMB273.5 million, RMB31.1 million and RMB37.8 million, respectively.

The following table sets forth the fair value gains on our investment properties that were completed or under development for the years indicated:

		Under
	Completed	development	Total

	(RMB)	(RMB)	(RMB)
		(in thousands)
At January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . .	8,900	1,334,000	1,342,900
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	831,507	831,507
Disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(4,700)	–	(4,700)
Fair value gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	273,493	273,493
At December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . .	4,200	2,439,000	2,443,200
Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	631,314	631,314
Completion of projects . . . . . . . . . . . . . . . . . . . . . . . .	3,070,314	(3,070,314)	–
Fair value gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	31,086	−	31,086
At December 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . .	3,105,600	−	3,105,600

Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	35,736	127,825	163,561
Fair value gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9,664	28,175	37,839
At December 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . .	3,151,000	156,000	3,307,000

Selling and Marketing Costs

Selling and marketing costs consist primarily of advertising and publicity expenses, sales commissions, including commissions in relation to our outsourced marketing activities, selling and marketing staff costs, expenses relating to exhibitions and trade fairs and other expenses relating to sales of our properties, including advertisements on television and in newspapers, magazines, and on billboards.

The following table sets forth our selling and marketing costs for the years indicated:

			Year ended December	31,

		2011	2012	2013

		(RMB)	(RMB)	(RMB)
			(in thousands)
Selling and marketing costs
Sales commission . . . . . . . . . . . . . . . . . . . . . . . . . . . .		123,881	185,620	151,057
Advertising and publicity costs	. . . . . . . . . . . . . . . .	228,741	229,603	309,961
Staff costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		13,535	26,315	37,850
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		21,934	33,383	93,164

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		388,091	474,921	592,032

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Administrative Expenses

Administrative expenses consist primarily of administrative staff costs, depreciation, traveling expenses, rental payments, entertainment expenses and other office expenses. The following table sets forth our administrative expenses for the years indicated:

	Year ended December	Year ended December	31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Administrative expenses
Depreciation of property, plant and equipment . . . .	16,650	19,977	19,453
Amortization of intangible assets . . . . . . . . . . . . . . .	1,292	1,531	2,418
Bank charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16,914	9,304	18,610
Staff costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	251,869	337,782	407,296
Entertainment expenses . . . . . . . . . . . . . . . . . . . . . . .	69,234	68,393	72,568
Stamp duty and other taxes . . . . . . . . . . . . . . . . . . .	27,729	31,739	56,295
Professional fees(1) . . . . . . . . . . . . . . . . . . . . . . . . . .	18,983	32,436	6,714
Auditors’ remuneration . . . . . . . . . . . . . . . . . . . . . . .	4,250	3,280	3,200
Rental expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20,386	21,897	36,820
Traveling expenses . . . . . . . . . . . . . . . . . . . . . . . . . .	9,339	9,451	27,805
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	29,295	34,093	28,849

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	465,941	569,883	680,028

(1) Professional fees represent the fees paid to our auditor, legal advisers and property valuer and other professional parties, mainly in connection with our IPO and offerings of the April 2016 Notes and the January 2018 Notes. Such professional fees also include certain fees paid to our auditor, legal advisers and other professional parties who had provided professional services to us in our ordinary course of business that are not associated with our IPO and offerings of the April 2016 Notes and the January 2018 Notes.

Other Income/Other Expenses/Other Net Gains or Losses

Our other income, other expenses and other net gains or losses primarily consist of government grants, compensation for the return of land use rights, cancellation of property sales contracts or relating to law suits, dividend income and gains from disposal of available-for-sale financial assets, donations and expenses relating to third-party services.

Finance Costs – Net

Our finance costs primarily consist of interest expenses on bank loans, trust financing arrangements and senior notes less capitalized interest and finance income. Interest on borrowings relating to project development is capitalized to the extent they are directly attributable to a particular project and used to finance the development of that project. Because the development period for a project does not necessarily coincide with the interest payment period of the relevant loan, not all of the interest costs related to a project can be capitalized. As a result, our finance costs fluctuate from period to period depending on the amount of interest costs that are capitalized within the reporting period.

Our interest expenses (including capitalized interest expenses) incurred in the years ended December 31, 2011, 2012 and 2013 were RMB1,026.0 million, RMB1,015.7 million and RMB1,209.8 million, respectively.

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Income Tax Expense

Our income tax expense for a given period includes provisions made for LAT, PRC corporate income tax and deferred income tax (including PRC withholding tax) during the year. For the years ended December 31, 2011, 2012 and 2013, our effective corporate income tax rate[1] was 27.7%, 27.3% and 27.5%, respectively.

The following table sets forth our income tax expense for the years indicated:

		Year ended December	31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Current income tax
LAT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	388,216	636,150	866,582
PRC corporate income tax . . . . . . . . . . . . . . . . . . . . .	624,707	535,545	761,242
	1,012,923	1,171,695	1,627,824
Deferred income tax . . . . . . . . . . . . . . . . . . . . . . . . . .	(71,639)	61,082	(108,495)

Total income tax charged for the year . . . . . . . . .	941,284	1,232,777	1,519,329

Review of Historical Operating Results

Year ended December 31, 2013 compared to year ended December 31, 2012

Revenue

Our revenue increased by RMB3,254.0 million, or 18.6%, from RMB17,517.3 million in 2012 to RMB20,771.3 million in 2013. This increase was primarily driven by the increase in revenue from property sales from RMB17,341.9 million in 2012 to RMB20,421.8 million in 2013, which was in turn driven by a 29.4% increase in our total GFA delivered from 1,912,223 sq.m. in 2012 to 2,475,098 sq.m. in 2013, partially offset by a 9.0% decrease in our ASP from RMB9,069 per sq.m. in 2012 to RMB8,251 per sq.m. in 2013. The decrease in ASP in the 2013 was primarily due to a lower percentage of property sales of high-end properties, which have higher selling prices. The following table sets forth certain revenue information relating to the main properties we delivered and recognized as sales during the years indicated:

					Year ended	December 31,

			2012				2013

				Percentage				Percentage
					of total				of total
					property				property
Project	Location	Revenue	GFA	ASP	sales	Revenue	GFA	ASP	sales

		(RMB		(RMB/		(RMB
		million)	(sq.m.)	sq.m.)		million)	(sq.m.)	(US$/ sq.m.)
Petrus Hacienda
(碧翠園) . . . . . . . . . .	Shanghai	1,129.0	41,926	26,928	6.5%	2,228.1	79,293	28,099	10.9%
Park View International
Community
(上海金郡)(1) . . . . . . .	Shanghai	–	–	–	–	1,790.5	137,035	13,066	8.8%
Future Consequence
(香悅半島) . . . . . . . .	Changzhou	–	–	–	–	1,385.9	186,700	7,423	6.8%

(1) Our effective corporate income tax rate is calculated as:

PRC corporate income tax + Deferred income tax Effective corporate income tax rate = × 100 Profit before income tax - PRC land appreciation tax

– 60 –

					Year ended	December 31,

			2012				2013

				Percentage				Percentage
					of total				of total
					property				property
Project	Location	Revenue	GFA	ASP	sales	Revenue	GFA	ASP	sales

		(RMB		(RMB/		(RMB
		million)	(sq.m.)	sq.m.)		million)	(sq.m.)	(US$/ sq.m.)
Fragrant Legend
(香溢瀾橋) . . . . . . . .	Changzhou	–	–	–	–	1,284.8	193,388	6,643	6.3%
Changsha International
Metropolis
(長沙國際花都) . . . . .	Changsha	–	–	–	–	1,190.9	311,166	3,827	5.8%
Future France
(香溢紫郡) . . . . . . . .	Changzhou	–	–	–	–	1,095.5	187,363	5,847	5.4%
Future Land Golden
County
(蘇州新城金郡) . . . . .	Suzhou	1,156.8	142,376	8,125	6.7%	1,067.5	133,949	7,969	5.2%
Up Town (尚東雅園) . . .	Wuxi	683.3	77,844	8,777	3.9%	952.0	124,235	7,663	4.7%
Future Land Golden
County
(新城金郡) . . . . . . . .	Changzhou	1,276.2	102,556	12,444	7.4%	894.5	74,250	12,047	4.4%
Xincheng Future Town
(新城域) . . . . . . . . . .	Changzhou	1,228.3	230,531	5,328	7.1%	818.4	151,209	5,413	4.0%
Future Capital
(新城首府) . . . . . . . .	Changzhou	–	–	–	–	787.2	72,887	10,801	3.9%
Future Royal Bay
(禦景灣) . . . . . . . . . .	Changzhou	–	–	–	–	784.4	93,551	8,385	3.8%
Wuhan in Spring Live
(武漢春天里) . . . . . . .	Wuhan	–	–	–	–	678.0	86,319	7,855	3.3%
Park View Ivy
(新城金郡常春藤). . . .	Shanghai	–	–	–	–	661.3	36,838	17,953	3.2%
Exalted Uptown
(尚上城) . . . . . . . . . .	Shanghai	731.0	57,587	12,694	4.2%	624.1	58,264	10,712	3.1%
Total . . . . . . . . . . . . .		6,204.6	652,820	9,504	35.8%	16,243.1	1,926,447	8,432	79.6%

Note:

(1) Includes Park View International Community A and Park View International Community B.

– 61 –

Cost of Sales

Our cost of sales increased by RMB2,500.6 million, or 18.4%, from RMB13,587.4 million in 2012 to RMB16,088.0 million in 2013. This increase was primarily due to an increase in GFA delivered, partially offset by a decrease in average cost per sq.m. sold from RMB6,507 sq.m. in 2012 to RMB5,916 sq.m. in 2013. The decrease in average cost per sq.m. sold in 2013 was primarily due to the decrease in high-end property sales.

Gross Profit

As a result of the foregoing, our gross profit increased by RMB753.3 million, or 19.2%, from RMB3,929.9 million in 2012 to RMB4,683.2 million in 2013. Our overall gross profit margin was 22.5% and 22.4% in 2013 and 2012, respectively.

Fair Value Gains on Investment Properties

Our fair value gains on investment properties increased by RMB6.7 million, or 21.5%, from RMB31.1 million in 2012 to RMB37.8 million in 2013. This increase in gains on investment properties was primarily because Wujiang lnjoy Plaza (吳江吾悅廣場), a newly developed investment property in 2013, commenced construction in that year.

Selling and Marketing Costs

Our selling and marketing costs increased by RMB117.1 million, or 24.7%, from RMB474.9 million in 2012 to RMB592.0 million in 2013, primarily due to an increase in our advertising and publicity activities as we launched more projects for pre-sale in 2013.

Administrative Expenses

Our administrative expenses increased by RMB110.1 million, or 19.3%, from RMB569.9 million in 2012 to RMB680.0 million in 2013. The increase was primarily due to an increase in staff costs resulting from an increase in our staff headcount, as well as an increase in salary levels of our staff in 2013.

Finance Costs – Net

Our net finance costs increased by RMB283.2 million, or 253.7%, from RMB111.7 million 2012 to RMB394.9 million in 2013. This increase was primarily due to the uncapitalized finance costs of senior notes and working capital loans incurred during 2013. See “Description of Other Material Indebtedness.”

Income Tax Expense

Our income tax expense increased by RMB286.5 million, or 23.2%, from RMB1,232.8 million in 2012 to RMB1,519.3 million in 2013. The increase was primarily due to the increase in our PRC land appreciation tax and enterprise income tax in 2013 as a result of the increase in our properties delivered, and therefore more revenue and profit were recognized during the same period.

Profit for the Year

As a result of the foregoing, our profit increased by RMB131.7 million, or 8.3%, from RMB1,585.4 million in 2012 to RMB1,717.1 million 2013. Out net profit margin decreased to 8.3% in 2013 from 9.1% in 2012. The decrease in our net profit margin was primarily due to (i) an increase in the interest that can not be capitalized; and (ii) an increase in income tax expenses.

– 62 –

Year ended December 31, 2012 compared to year ended December 31, 2011

Revenue

Our revenue increased by RMB6,750.0 million, or 62.7%, from RMB10,767.3 million in 2011 to RMB17,517.3 million in 2012. This increase was primarily attributable to a 62.5% increase in our recognized property sales and an increase in rental income. The increase in recognized property sales is attributable to a 36.9% increase in GFA delivered from 1,396,916 sq.m. in 2011 to 1,912,223 sq.m. in 2012 and a 18.5% increase in ASP per sq.m. in respect of GFA delivered in 2012. In response to signs of recovery in the PRC property market towards the second quarter of 2012, we expedited the pre-sale of our projects, which resulted in the significant increase in GFA delivered and recognized as sales in 2012. The following table sets forth certain revenue information relating to the main properties we delivered and recognized as sales during the years indicated:

						Year ended	December 31,

				2011				2012

						Percentage				Percentage
						of total				of total
						property				property
Project		Location	Revenue	GFA	ASP	sales	Revenue	GFA	ASP	sales

			(RMB million)	(sq.m.)	(RMB/sq.m.)		(RMB million)	(sq.m.)	(RMB/sq.m.)
Gorgeous Mansion
(憶華里) . . . . .	. . . . . .	Shanghai	–	–	–	–	1,606.1	125,414	12,807	9.3%
Future Land Golden	County
(新城金郡) . . . .	. . . . . .	Changzhou	–	–	–	–	1,276.2	102,556	12,444	7.4%
Xincheng Future Town
(新城域) . . . . .	. . . . . .	Changzhou	366.2	66,455	5,510	3.4%	1,228.3	230,531	5,328	7.1%
Injoy Plaza (吾悅廣場) . . . .		Changzhou	810.4	123,690	6,552	7.6%	1,337.3	190,560	7,018	7.7%
Future Land Golden	County
(蘇州新城金郡) .	. . . . . .	Suzhou	280.8	36,677	7,656	2.6%	1,156.8	142,376	8,125	6.7%
Future Land Hacienda
(新城碧翠園) . .	. . . . . .	Shanghai	–	–	–	–	1,129.0	41,926	26,928	6.5%
Park No. 1 (公園壹號) . . . .		Changzhou	627.7	129,976	4,771	5.9%	1,082.7	207,475	5,219	6.2%
YOHO City (悠活城) . . . . .		Shanghai	847.4	57,324	14,783	7.9%	1,065.3	78,666	13,542	6.1%
New Golden Town
(南京新城金郡) .	. . . . . .	Nanjing	–	–	–	–	1,058.9	97,861	10,821	6.1%
Xincheng Geniality Bay
(清水灣) . . . . .	. . . . . .	Changzhou	476.1	132,053	3,605	4.5%	1,047.7	208,101	5,035	6.0%
Legend Mansion
(上海新城公館)	. . . . . .	Shanghai	–	–	–	–	935.7	46,256	20,229	5.4%
Injoy International Plaza
(吾悅國際廣場) .	. . . . . .	Changzhou	–	–	–	–	848.8	61,458	13,812	4.9%
Exalted Uptown (尚上城). . .		Shanghai	–	–	–	–	731.0	57,587	12,694	4.2%
Up Town (尚東雅園). . . . . .		Wuxi	–	–	–	–	683.3	77,844	8,777	3.9%
Injoy Lifestyle Plaza
(吾悅生活廣場) .	. . . . . .	Changzhou	–	–	–	–	564.7	54,672	10,329	3.3%
Total . . . . . . . . .	. . . . . .		3,408.6	546,175	6,227	31.9%	15,751.8	1,723,283	9,141	90.8%

Cost of Sales

Our cost of sales increased by RMB5,843.7 million, or 75.5%, from RMB7,743.7 million in 2011 to RMB13,587.4 million in 2012. This increase was primarily attributable to the increases in both GFA delivered and cost per sq.m. sold for the GFA delivered from RMB4,777 in 2011 to RMB6,507 in 2012. The increase in average cost per sq.m. sold in 2012 was primarily due to the higher costs associated with the mix of properties delivered during the year, including a higher percentage of high-end fitted out properties and properties located in Shanghai, which involved higher costs.

– 63 –

Gross Profit

As a result of the foregoing, our gross profit increased by RMB906.3 million, or 30.0%, from RMB3,023.6 million in 2011 to RMB3,929.9 million in 2012. Our gross profit margin decreased from 28.1% in 2011 to 22.4% in 2012. The decrease in gross profit margin was primarily attributable to the marketing and pricing strategy we adopted due to challenging market conditions along with an increase in land acquisition costs. The decrease in gross profit margin also reflected the downward pricing pressure we experienced in pre-selling our properties in the fourth quarter of 2011 and the beginning of 2012, many of which were delivered in 2012.

Fair Value Gains on Investment Properties

Our fair value gains on investment properties decreased by RMB242.4 million, or 88.6%, from RMB273.5 million in 2011 to RMB31.1 million in 2012. The relatively small amount of fair value gains recognized in 2012 was primarily because (i) no new investment properties were developed in 2012, and (ii) the rental rates for both Injoy International Plaza and Injoy Plaza remained flat as compared to 2011, resulting in limited valuation gains.

Selling and Marketing Costs

Our selling and marketing costs increased by RMB86.8 million, or 22.4%, from RMB388.1 million in 2011 to RMB474.9 million in 2012. The increase was primarily due to an increase in sales commissions, advertising and publicity expenses incurred as we launched more projects for pre-sale in 2012.

Administrative Expenses

Our administrative expenses increased by RMB103.9 million, or 22.3%, from RMB465.9 million in 2011 to RMB569.9 million in 2012. The increase was primarily due to an increase in staff costs resulting from an increase in our staff headcount, salary levels of our staff as well as professional fees incurred in connection with our IPO in 2012.

Finance Costs – Net

Our net finance costs decreased by RMB23.5 million, or 17.4%, from RMB135.1 million in 2011 to RMB111.7 million in 2012. This decrease was primarily due to an increase in interest income on bank deposits that resulted from an increase in restricted cash, which earned higher interest rates than current deposits.

Income Tax Expense

Our income tax expense increased by RMB291.5 million, or 31.0%, from RMB941.3 million in 2011 to RMB1,232.8 million in 2012. The increase was primarily due to the increase in our LAT in 2012 as a result of the increase in our properties delivered and therefore increases in revenue and profit recognized during the same year.

Profit for the Year

As a result of the foregoing, our profit increased by RMB141.5 million, or 9.8%, from RMB1,443.9 million in 2011 to RMB1,585.4 million in 2012. Our net profit margin decreased from 13.4% in 2011 to 9.1% in 2012. The decrease in our net profit margin was primarily due to the decrease in gross profit margin and decrease in fair value gains on investment properties.

– 64 –

Liquidity and Capital Resources

Overview

We operate in a capital-intensive industry, and our primary use for cash is to pay for land acquisition costs, construction costs and finance costs and to fund our working capital. To date, we have primarily financed our working capital, capital expenditure and other capital requirements through proceeds from our IPO and the offering of the January 2018 Notes and the April 2016 Notes, borrowings from financial institutions, proceeds from the pre-sales and sales of properties and income generated from our property management services and investment properties. Going forward, we believe our liquidity requirements will be satisfied using a combination of bank loans, cash generated from operating activities, proceeds from the offering of the Notes and other funds raised from the capital markets from time to time.

Cash Flows

The following table sets forth a summary of our consolidated statement of cash flows for the years indicated:

	Year	ended December

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Selected cash flow statement data
Net cash (used in)/generated from operating activities . .	(950,575)	1,062,569	(3,267,849)
Net cash used in investing activities . . . . . . . . . . . . . . . .	(916,526)	(546,948)	155,842
Net cash generated from financing activities . . . . . . . . . .	2,137,410	114,951	5,725,253
Net increase in cash and cash equivalents . . . . . . . . . . . .	270,309	630,572	2,613,246
Cash and cash equivalents at beginning of
the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,951,249	4,221,558	4,852,130
Cash and cash equivalents at end of the year . . . . . . . . .	4,221,558	4,852,130	7,411,713

Net cash generated from or used in operating activities

We generate our cash from operating activities primarily from proceeds received from pre-sales and sales of our properties and rental income. Our cash used in operating activities is primarily for our property development activities and land acquisitions.

Our net cash flow generated from operating activities reflects our profit before income tax, as adjusted for non-cash items, such as fair value gains on investment properties, finance costs and accrual or reversal of provisions for properties held for sale, and the effects of changes in working capital, such as increases or decreases in payments for properties held or under development for sale, advances from pre-sale of properties, prepayments for leasehold land and trade and other receivables or payables.

In 2013, we had a net cash used in operating activities of RMB3,267.8 million, primarily due to (i) net operating cash flow before working capital changes of RMB3,519.1 million, (ii) an increase in properties held or under development for sale of RMB3,509.1 million due to increased construction costs and land use rights costs, (iii) a decrease in advances from pre-sale of properties of RMB1,428.8 million and (iv) payment of interest and PRC income tax and PRC land appreciation tax of RMB2,349.1 million, partially offset by a decrease in prepayments of leasehold land of RMB1,028.3 million.

In 2012, we had a net cash generated from operating activities of RMB1,062.6 million, primarily due to (i) net operating cash flow before working capital changes of RMB2,824.1 million and (ii) an increase in trade and other payables of RMB2,977.5 million due to increased construction costs, salary and income tax expense. Cash generated from operating activities was offset by cash used for (i) prepayments for leasehold land of RMB1,624.7 million, (ii) a decrease in advances from pre-sale of properties of RMB1,111.2 million as properties were delivered and (iii) payment of interest and PRC income tax and PRC land appreciation tax of RMB2,099.4 million.

– 65 –

In 2011, we had a net cash used in operating activities of RMB950.6 million, primarily due to (i) net operating cash flow before working capital changes of RMB2,636.3 million, (ii) an increase in advances from pre-sales of properties of RMB2,180.9 million, in connection with projects mainly including Changzhou Future Land Golden County (常州新城金郡), Xincheng Future Town (常州新城域) and New Golden Town (南京新城金郡), and (iii) an increase in trade and other payables of RMB1,877.7 million as a result of increased property development activities. Cash generated from operating activities was offset by cash used for (i) an increase in properties held or under development for sale, excluding capitalized interest, of RMB6,008.9 million due to increased expenditures on land use rights costs, in connection with projects such as Petrus Hacienda (森蘭碧翠園), Exalted Uptown (尚上城), Changzhou Future Land Golden County (常州新城金郡) and Future Land Consequence (香悅半島), and construction costs, and (ii) payment of interest and PRC income tax and PRC land appreciation tax of RMB1,748.0 million.

See “Risk Factors – We had negative net operating cash flow for the years ended December 31, 2011 and 2013. If we are unable to meet our payment obligations, our business, financial condition and results of operations may be materially adversely affected” for further information relating to the risks associated with our negative net operating cash flow.

Net cash used in investing activities

In 2013, we had a net cash provided by investing activities of RMB155.8 million, primarily due to (i) cash inflow of RMB175.0 million in connection with the capital reduction from an associate and (ii) interest received from our bank balances in the amount of RMB121.8 million, partially offset by cash outflow in connection with our additions of investment properties of RMB163.6 million and acquisition of available-for-sale financial assets of RMB40.0 million, consisting of our 5.26% equity interest in Shanghai Wuling Investment Management Limited Partnership and 2.72% equity interest in Gefei Assets Management Limited Partnership.

In 2012, we had a net cash used in investing activities of RMB546.9 million, primarily due to additional costs of RMB551.3 million we incurred for our two investment properties that were completed during the year, partially offset by interest received from our bank balances.

In 2011, we had a net cash used in investing activities of RMB916.5 million, primarily due to (i) the additional costs of RMB748.3 million we incurred for our investment properties that were under development and (ii) investments in associated companies of RMB225.0 million in connection with our investment in Shanghai Wanzhicheng Real Estate Development Co., Ltd.

Net cash generated from financing activities

In 2013, we had a net cash generated from financing activities of RMB5,725.2 million, which consisted primarily of proceeds from borrowings of RMB15,652.9 million and proceeds from issuance of senior notes of RMB2,691.5 million, partially offset by the repayment of borrowings of RMB14,006.7 million.

In 2012, we had a net cash generated from financing activities of RMB115.0 million, primarily due to proceeds from borrowings of RMB6,249.3 million and proceeds of RMB1,668.9 million from our IPO, offset by repayment of borrowings of RMB7,475.8 million.

In 2011, we had a net cash generated from financing activities of RMB2,137.4 million, which consisted primarily of proceeds from borrowings of RMB6,830.4 million, offset by the repayment of borrowings of RMB4,423.0 million.

– 66 –

Net Current Assets Position

The following table sets forth our assets and liabilities as of the balance sheet dates indicated:

		As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Current assets
Prepayments for leasehold land . . . . . . . . . . . . . . . . .	2,689,155	4,313,847	3,285,498
Properties held or under development for sale. . . . .	24,227,066	24,493,752	28,728,964
Trade and other receivables and prepayments . . . . .	1,761,606	1,666,266	2,112,831
Restricted cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	314,536	1,148,089	886,180
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . .	4,221,558	4,852,130	7,411,713
Total current assets. . . . . . . . . . . . . . . . . . . . . . . . . .	33,213,921	36,474,084	42,425,186

Current liabilities
Trade and other payables . . . . . . . . . . . . . . . . . . . . . .	6,627,089	9,597,029	10,368,476
Advances from pre-sale of properties . . . . . . . . . . . .	12,775,020	11,663,869	10,235,042
Current income tax liabilities. . . . . . . . . . . . . . . . . . .	1,085,703	1,143,835	1,673,306
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4,217,363	5,130,436	2,174,501
Dividends payable. . . . . . . . . . . . . . . . . . . . . . . . . . . .	805	805	929
Total current liabilities. . . . . . . . . . . . . . . . . . . . . . .	24,705,980	27,535,974	24,452,254

Net current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .	8,507,941	8,938,110	17,972,932

As of December 31, 2013, our net current assets of RMB17,972.9 million, consisted of RMB42,425.2 million of current assets and RMB24,452.3 million of current liabilities, which represented an increase of approximately RMB9,034.8 million from our net current assets of RMB8,938.1 million as of December 31, 2012. The increase in net current assets was primarily attributable to an increase in properties held on under development for sale, which was partially offset by a decrease in prepayments for leasehold land.

Contractual Obligations

As of December 31, 2013, our total capital commitments in connection with our property development activities amounted to RMB11,748.4 million, primarily arising from outstanding land premium payments of RMB3,820.5 million and contracted construction fees.

The following table sets forth our property development expenditures contracted but not provided for as of the dates indicated:

		As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Property development expenditure contracted
but not provided for . . . . . . . . . . . . . . . . . . . . . . . .	6,962,029	8,376,039	11,748,357

The following table sets forth our operating lease commitments for rental expenses as of the dates indicated:

		As of December 31,	As of December 31,

	2011	2012		2013

	(RMB)	(RMB)		(RMB)
		(in thousands)
Within 1 year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9,889	13,399		12,234
1 to 5 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13,663	10,432		24,306
Over 5 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–		–	25,908
	23,552	23,831		62,448

– 67 –

We intend to fund our capital and lease commitments principally from bank financings and proceeds from sales and pre-sales of our developed properties.

Indebtedness

Bank and Other Borrowings

The following table sets forth our outstanding borrowings as of the dates indicated:

		As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Current borrowings
Bank borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . .	384,000	1,210,716	643,042
Trust financing arrangements
– conventional loan. . . . . . . . . . . . . . . . . . . . . . . . .	319,300	311,860	–
– equity with repurchase obligation. . . . . . . . . . . .	430,000	–	–
Current portion of long-term borrowings . . . . . . . . .	3,084,063	3,607,860	1,531,459
Total current borrowings. . . . . . . . . . . . . . . . . . . . .	4,217,363	5,130,436	2,174,501
Non-current borrowings
Bank borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6,128,900	6,242,070	10,179,459
Trust financing arrangements
– conventional loan . . . . . . . . . . . . . . . . . . . . . . . .	2,137,200	1,875,460	–
– equity with repurchase obligation . . . . . . . . . . .	1,467,163	–	–
Senior notes due January 2018 . . . . . . . . . . . . . . . . .	–	–	1,189,147
Senior notes due April 2016 . . . . . . . . . . . . . . . . . . .	–	–	1,477,928
Non-current, unsecured and borrowed
from a bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	–	400,000

	9,733,263	8,117,530	13,246,534
Less: Current portion of long-term borrowings . . .	(3,084,063) (3,607,860)		(1,531,459)
Total non-current borrowings . . . . . . . . . . . . . . . .	6,649,200	4,509,670	11,715,075
Total current and non-current borrowings . . . . .	10,866,563	9,640,106	13,889,576

Since 2009, we have funded our development costs (including land premium) with internal resources, bank borrowings and trust financing arrangements, as well as the January 2018 Notes and the April 2016 Notes issued on January 31, 2013 and April 23, 2013 respectively.

Our outstanding current and non-current borrowings from banks and trust financing arrangements amounted to RMB10,866.6 million, RMB9,640.1 million and RMB11,222.5 million (US$1,853.8 million) as of December 31, 2011, 2012 and 2013, respectively. Our current and non-current borrowings from banks increased steadily during the three years ended December 31, 2013, primarily due to an increase in construction activities during such years and a shift in our product mix to an increasing proportion of higher end products, which were more capital intensive.

As of December 31, 2013, we had unutilized banking facilities of approximately RMB7,556.5 million. Provided that we obtain all necessary permits and licenses for development of our relevant projects as required by the banks and that the funding will be used for the relevant project for which we have applied for the funding, the use of the unutilized banking facilities generally will not be restricted. This condition is customary for the banks to provide banking facilities to property developers in China.

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The following table sets forth the maturity profile of our non-current borrowings as of the dates indicated:

		As at December 31,	As at December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Between 1 and 2 years . . . . . . . . . . . . . . . . . . . . . . . .	3,671,200	2,700,670	4,043,500
Between 2 and 5 years . . . . . . . . . . . . . . . . . . . . . . . .	2,978,000	1,359,000	6,931,575
Over 5 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	450,000	740,000
	6,649,200	4,509,670	11,715,075

All of our bank borrowings are secured by one or a combination of the following methods: land to be developed, properties under development, properties held for sale, investment properties, land use rights, shares of our subsidiaries, bank deposits, guarantees by our subsidiaries. Our bank borrowings are from major commercial banks, which are independent third parties. As of December 31, 2011, 2012 and 2013, the weighted average effective interest rate on our bank borrowings was 6.69%, 6.76% and 6.85%, respectively, and as of December 31, 2011 and 2012, the weighted average cost of borrowing of our trust financing arrangements was 13.28% and 13.50%, respectively. We had no trust financing arrangements as of December 31, 2013.

Our trust financings have committed yield rates and trust periods. The borrowings were raised via issuance of trust units. These borrowings were secured by certain properties and shares of our subsidiaries. Our trust financing arrangements were made with major trust financing companies, which are independent third parties. For details of such trust financing companies and trust financings, see the section headed “Business – Trust Financing Arrangements.”

For our trust financing arrangements, trust financing companies do not usually link their interest rates to the PBOC benchmark interest rates and typically charge rates ranging from 3% to 7% higher than those charged by commercial banks. For further information, see the section headed “Business – Trust Financing Arrangements.”

As a result of these borrowings, our operations are subject to a wide range of customary restrictive covenants under our bank borrowing and trust financing arrangements. For further information, see the sections headed “Risk Factors – Risks Relating to Our Business – We are subject to risks associated with certain covenants or restrictions under our bank borrowings or trust financing arrangements which may adversely affect our business, financial condition and results of operations.”

Financial Guarantees and Contingent Liabilities

We make arrangements with various PRC banks to provide mortgage facilities to purchasers of our pre-sold properties. In accordance with market practice, we are required to provide guarantees to these banks in respect of mortgages provided to such customers. Guarantees for mortgages on pre-sold residential properties are generally discharged at the earlier of: (i) the property ownership certificates are registered in favor of the mortgagee banks, or (ii) the settlement of mortgage loans between the mortgagee banks and the purchasers. If a purchaser defaults on the mortgage loan, we are typically required to repurchase the underlying property by paying off the mortgage loan. If we fail to do so, the mortgagee banks will auction the underlying property and recover the balance from us if the outstanding loan amount exceeds the net foreclosure sale proceeds. In line with industry practice, we do not conduct independent credit checks on our customers but rely on the credit checks conducted by the mortgagee banks. As of December 31, 2011, 2012 and 2013, our outstanding guarantees for mortgage loans of the purchasers of our pre-sold properties were approximately RMB3,970.8 million, RMB3,993.7 million and RMB2,980.7 million, respectively. In the three years ended December 31, 2013, we encountered 13 incidents of default by purchasers, which involved an aggregated default payment of RMB11.2 million, all of which we were able to recover. Our general policy is that for purchasers utilizing mortgage loans, if purchasers default on subsequent payments after the down payment, we reserve our rights to seize the full amount of the down payment, unless we are able to resell the property at a price not less than the original amount we sold to such defaulting customers, and that the resale proceeds are sufficient to cover our enforcement costs. Financial guarantees are contingent liabilities not recognized in our financial statements.

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The following table sets forth our financial guarantees as of the dates indicated:

		As of December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Guarantees in respect of mortgage facilities for
certain purchasers of our properties . . . . . . . . . . .	3,970,751	3,993,685	2,980,716

Except as disclosed in “Contractual Obligations” and “– Indebtedness” above, we did not have outstanding mortgages, charges, debentures, loan capital, bank overdrafts, loans, debt securities or other similar indebtedness, finance leases or hire purchase commitments, liabilities under acceptances or acceptance credits or any guarantees or other material contingent liabilities outstanding as of December 31, 2013.

Qualitative and Quantitative Disclosure about Market Risk

We are exposed to various types of market risks, including credit risk, interest rate risk, and liquidity risk.

Credit Risk

We have no significant concentrations of credit risk. The carrying amounts of bank deposits, and trade and other receivables included in the consolidated statements of financial position represent our maximum exposure to credit risk in relation to our financial assets. We have policies in place to ensure that sales of properties are made to buyers with appropriate financial strength and with the appropriate percentage of down payment. In addition, we reserve the right to cancel the sales contract in the event that the buyers default in payment and put the underlying properties back to the market for re-sale. The credit risk from sales of properties is therefore limited. Other receivables mainly comprise receivables from related parties and deposits made in the ordinary course of business. We closely monitor these other receivables to ensure actions are taken to recover these balances in the case of any risk of default.

Interest Rate Risk

Our interest rate risk relates primarily to our fixed-rate borrowings and variable-rate borrowings. Borrowings at fixed-rates expose us to fair value interest rate risk and borrowings at variable rates expose us to cash flow interest rate risk. We currently have not entered into interest rate swaps to hedge against our exposure to changes in fair values of our borrowings. It is our policy to maintain an appropriate level between our fixed-rate and variable rate borrowings so as to balance the fair value and cash flow interest rate risk.

In addition, to the extent that we may need to raise debt financing in the future, upward fluctuations in interest rates will increase the cost of new debts. Fluctuations in interest rates can also lead to significant fluctuations in the fair values of our debt obligations.

We currently do not use any derivative instruments to manage our interest rate risk. To the extent we decide to do so in the future, there can be no assurance that any future hedging activities will protect us from fluctuations in interest rates.

Liquidity Risk

The capital-intensive nature of our business exposes us to liquidity risk. We are exposed to liquidity risk if we are unable to raise sufficient funds to meet our capital commitments. To manage the liquidity risk, we monitor and maintain a level of cash and cash equivalents considered adequate by our management to finance our operations and mitigate the effects of fluctuations in cash flows. In doing so, our management monitors capital on the basis of the gearing ratio to ensure adequate undrawn banking facilities and monitors the utilization of borrowings to ensure compliance with loan covenants. We also continue to obtain longer term financing facilities, mainly issuance of senior notes, project bank loans with pledge of our properties or other resources of funding which we consider appropriate.

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Off-Balance Sheet Arrangements

Except for the contingent liabilities disclosed, we have not entered into any off-balance sheet arrangements or commitments to guarantee the payment obligations of any third parties. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing or hedging services with us.

Non-GAAP Financial Measures

We use EBITDA to provide additional information about our operating performance. EBITDA refers to our earnings before the following items:

interest income/expense, including capitalized interest under cost of sales;
amortization of intangible assets;
fair value gains on investment properties;
other gains-net;
income tax expense; and
depreciation.

EBITDA is not a standard measure under HKFRSs or generally accepted accounting principles in other jurisdictions. As the property development business is capital intensive, capital expenditure requirements and levels of debt and interest expenses may have a significant impact on the profit of companies with similar operating results. Therefore, we believe the investor community commonly use this type of financial measure to assess the operating performance of companies in our market sector.

EBITDA refers to our operating profit plus depreciation, amortization and capitalized interest under cost of sales, but excluding fair value gains on the investment properties and net gains or losses. EBITDA is not a standard measure under HKFRSs. EBITDA is a widely used financial indicator of a company’s ability to service and incur debt. EBITDA should not be considered in isolation or construed as an alternative to cash flows, net income or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. EBITDA does not account for taxes, interest expense, capitalized interest or other non-operating items. In evaluating EBITDA, we believe that investors should consider, among other things, the components of EBITDA such as sales and operating expenses and the amount by which EBITDA exceeds capital expenditures and other charges. We have included EBITDA because we believe it is a useful supplement to cash flow data as a measure of our performance and our ability to generate cash flow from operations to cover debt service and taxes. EBITDA presented herein may not be comparable to similarly titled measures presented by other companies. Investors should not compare our EBITDA to EBITDA presented by other companies because not all companies use the same definition.

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The following table reconciles our profit for the year under HKFRSs to our definition of EBITDA for the years indicated.

	Year	ended December 31,	ended December 31,

	2011	2012	2013

	(RMB)	(RMB)	(RMB)
		(in thousands)
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10,767,254	17,517,266	20,771,255
Profit for the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,443,931	1,585,384	1,717,137
Adjustments:
Finance costs (including capitalized interest under
cost of sales). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	533,430	843,988	1,165,765
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . .	941,284	1,232,777	1,519,329
Fair value gains on investment properties . . . . . . . . . .	(273,493)	(31,086)	(37,839)
Other gains – net . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(58,076)	(13,626)	(46,270)
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	16,650	19,977	19,453
Amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,292	1,531	2,418

EBITDA(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2,605,018	3,638,945	4,339,993

EBITDA margin(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . .	24.2%	20.8%	20.9%

(1) EBITDA refers to our operating profit plus depreciation, amortization and capitalized interest under cost of sales, but excluding fair value gains on the investment properties and net gains or losses. EBITDA is not a standard measure under HKFRSs. EBITDA is a widely used financial indicator of a company’s ability to service and incur debts. EBITDA should not be considered in isolation or construed as an alternative to cash flows, net income or any other measure of financial performance or as an indicator of our operating performance, liquidity, profitability or cash flows generated by operating, investing or financing activities. EBITDA does not account for taxes, interest expense or other non-operating items. In evaluating EBITDA, we believe that investors should consider, among other things, the components of EBITDA such as sales and operating expenses and the amount by which EBITDA exceeds capital expenditures and other charges. We have included EBITDA because we believe it is a useful supplement to cash flow data as a measure of our performance and our ability to generate cash flow from operations to cover debt service and taxes. EBITDA presented herein may not be comparable to similarly titled measures presented by other companies. Investors should not compare our EBITDA to EBITDA presented by other companies because not all companies use the same definition. See the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures” for a reconciliation of our profit for the year under HKFRSs to our definition of EBITDA. Investors should also note that EBITDA as presented herein may be calculated differently from Consolidated EBITDA as defined and used in the Indenture. See the section headed “Description of the Notes – Definitions” for a description of the manner in which Consolidated EBITDA is defined for purposes of the Indenture.
(2) EBITDA margin is calculated by dividing EBITDA by revenue.

You should not consider our definition of EBITDA in isolation or construe it as an alternative to profit for the year or as an indicator of operating performance or any other standard measure under HKFRSs or generally accepted accounting principles in other jurisdictions. Our definition of EBITDA does not account for taxes and other non-operating cash expenses. Our EBITDA measures may not be comparable to similarly titled measures used by other companies.

Recent Accounting Announcements

The following new standards and amendments to existing standards are mandatory for the first time for the financial year beginning on January 1, 2013 and are relevant to our operations.

HKAS 1 (Amendment) “Presentation of Financial Statements” (effective for annual periods beginning on or after 1 July 2012). The main change resulting from the amendment is a requirement for entities to group items presented in “other comprehensive income” (OCI) on the basis of whether they are potentially reclassifiable to profit or loss subsequently (reclassification adjustments).
HKFRS 7 (Amendment) “Financial Instruments: Disclosures – Offsetting Financial Assets and Financial Liabilities” (effective for annual periods beginning on or after 1 January 2013). The amendment requires new disclosure requirements which focus on quantitative information about recognized financial instruments that are offset in the statement of financial position, as well as those recognized financial instruments that are subject to master netting or similar arrangements irrespective of whether they are offset.

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HKFRS 10 “Consolidated Financial Statements” (effective for annual periods beginning on or after 1 January 2013). The standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess.
HKAS 27 (Revised 2011) “Separate Financial Statements” (effective for annual periods beginning on or after 1 January 2013). The standard includes the provisions on separate financial statements that are left after the control provisions of HKAS 27 have been included in the new HKFRS 10.
HKFRS 11 “Joint Arrangements” (effective for annual periods beginning on or after 1 January 2013). The standard is a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement rather than its legal form. There are two types of joint arrangement: joint operations and joint ventures. Joint operations arise where a joint operator has rights to the assets and obligations relating to the arrangement and hence accounts for its interest in assets, liabilities, revenue and expenses. Joint ventures arise where the joint operator has rights to the net assets of the arrangement and hence equity accounts for its interest. Proportional consolidation of joint ventures is no longer allowed.
HKAS 28 (Revised 2011) “Investments in Associates and Joint Ventures” (effective for annual periods beginning on or after 1 January 2013). The standard includes the requirements for joint ventures, as well as associates, to be equity accounted following the issue of HKFRS 11.
HKFRS 12 “Disclosure of Interests in Other Entities” (effective for annual periods beginning on or after 1 January 2013). The standard includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles.
HKFRS 13 “Fair Value Measurement” (effective for annual periods beginning on or after 1 January 2013). The standard aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across HKFRSs. The requirements do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within HKFRSs.
HKFRSs 10, 11 and 12 (Amendments) “Transition Guidance” (effective for annual periods beginning on or after 1 January 2013). These amendments provide additional transition relief to HKFRSs 10, 11 and 12, limiting the requirement to provide adjusted comparative information to only the preceding comparative period. For disclosures related to unconsolidated structured entities, the amendments remove the requirement to present comparative information for periods before HKFRS 12 is first applied.
Annual improvements 2011 – These annual improvements address six issues in the 2009-2011 reporting cycle. They include changes to the following standards which are relevant to the Group’s operations:

HKAS 1 “Presentation of Financial Statements”

HKAS 16 “Property, Plant and Equipment”

HKAS 32 “Financial Instruments: Presentation”

HKAS 34 “Interim Financial Reporting”

Annual improvement 2012 – Amendment to HKFRS 13 “Fair Value Measurement”. This amendment is a clarification that there is no change in measurement requirements for short-term receivables and payables when the effect of not discounting is immaterial:

The adoption of the above new standards and amendments and other newly effective HKFRSs starting from 1 January 2013 did not give rise to any significant impact on our results of operations and financial position for the year ended December 31, 2013.

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INDUSTRY OVERVIEW

Certain information and statistics set out in this section have been extracted from various government publications, market data provider and other independent third-party sources. We believe that the sources of this information are appropriate sources for such information and have taken reasonable care in extracting and reproducing such information. We have no reason to believe that such information is false or misleading or that any fact has been omitted that would render such information false or misleading. The information has not been independently verified by us or any other party involved in the offering of the Notes and no representation is given as its accuracy. Accordingly, such information should not be unduly relied upon.

Overview of the PRC Economy

From 2003 to 2007, China’s real GDP grew at a CAGR of approximately 11.0%, making it one of the fastest growing major economies in the world. Amid the global financial crisis, China achieved an annual real GDP growth of 9.6% in 2008 and maintained positive economic growth throughout the crisis. China was among the first countries to recover from the global financial crisis. In February 2011, it overtook Japan to become the world’s second largest economy. China’s economic growth slowed in 2012 due to various factors, including the European debt crises and weaker global demand for exports. The National Bureau of Statistics estimated that China’s real GDP grew 7.7% in 2013.

Overall Economic Growth

In the past decade, China’s nominal GDP has increased from RMB21,631 billion in 2006 to RMB56,885 billion in 2013, representing a CAGR of approximately 14.8%. Over the same period, China’s nominal GDP per capita increased at a CAGR of 14.2% from RMB16,500 in 2006 to RMB41,850 in 2013, demonstrating a significant increase in the purchasing power of the PRC population. The table below sets out selected economic statistics of China for the periods indicated.

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Nominal GDP
(RMB billion) . . . . . . . . . . .	21,631	26,581	31,405	34,090	39,798	47,310	51,932	56,885	14.8%
Real GDP growth rate (%) . . . . . .	12.7%	14.2%	9.6%	9.2%	10.4%	9.3%	7.8%	7.7%	N/A
Nominal GDP per capita (RMB) . . .	16,500	20,169	23,708	25,608	30,015	35,181	N/A	41,805	14.2%
Fixed asset investment
(RMB billion) . . . . . . . . . . .	11,000	13,732	17,283	22,460	27,812	31,149	37,468	44,707	22.2%
Fixed asset investment growth (%). .	23.9%	24.8%	25.9%	30.0%	23.8%	12.0%	20.3%	19.3%	N/A

Source: National Bureau of Statistics

Urbanization

Strong economic growth has encouraged the rapid urbanization and population growth in selected cities in China. The urbanization rate in China has increased significantly from 37.7% in 2001 to 51.3% in 2011. The table below sets out China’s urbanization rate for the periods indicated.

										2006-2013
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Urban population (million) . .	577	594	607	622	666		691	712	731	3.4%
Total population (million) . . .	1,314	1,321	1,328	1,335	1,371	1,347		1,354	1360.7	0.5%
Urbanization rate (%) . . . . .	43.9%	44.9%	45.7%	46.6%	49.7%	51.3%		52.6%	53.72%	N/A

Source: National Bureau of Statistics

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Disposable Income

The strong growth of the PRC economy has contributed to the rise in disposable income in China. Per capita disposable income of urban households grew steadily between 2006 and 2013 at a CAGR of 12.6%. The table below sets out the per capita disposable income of urban households over the periods indicated.

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Per capita disposable income of
urban households (RMB) . . . . .	11,759	13,786	15,781	17,175	19,109	21,810	24,565	26,955	12.6%

Source: National Bureau of Statistics

The cities in which our existing and planned property developments and investments are situated also experienced significant GDP growth. The tables below set out selected economic statistics of these cities for the periods indicated.

	2006	2006	2007	2007	2008	2008	2009	2009	2010	2010	2011	2011	2012	2012	2013	2013

		Normal		Normal		Normal		Normal		Normal		Normal		Normal		Normal
	Normal	growth	Normal	growth	Normal	growth	Normal	growth	Normal	growth	Normal	growth	Normal	growth	Normal	growth
	GDP	rate	GDP	rate	GDP	rate	GDP	rate	GDP	rate	GDP	rate	GDP	rate	GDP	rate

	RMB bn		RMB bn		RMB bn		RMB bn		RMB bn		RMB bn		RMB bn		RMB bn
China . . . . .	21,631	17.0%	26,581	22.9%	31,405	18.1%	34,090	8.6%	39,798	16.9%	47,310	17.8%	51,932	9.8%	56,885	9.5%
Changzhou . .	159	21.2%	191	20.7%	227	18.4%	252	11.2%	304	20.8%	358	17.6%	397	10.9%	436	9.8%
Shanghai . . .	1,057	14.3%	1,249	18.2%	1,407	12.6%	1,505	6.9%	1,717	14.1%	1,920	11.8%	2,010	4.7%	2,160	7.5%
Nanjing. . . .	282	15.1%	334	18.3%	381	14.2%	423	10.9%	501	18.4%	615	22.6%	720	17.2%	801	11.3%
Wuxi . . . . .	331	17.9%	388	17.2%	446	15.0%	499	11.9%	579	16.1%	688	18.8%	757	10.0%	807	6.6%
Suzhou . . . .	490	18.4%	585	19.4%	708	21.0%	774	9.4%	923	19.2%	1,050	13.8%	1,201	14.4%	1,300	8.2%
Changsha. . .	212	18.9%	258	21.8%	330	27.9%	374	13.5%	455	21.4%	562	23.6%	640	13.9%	715	11.8%
Wuhan . . . .	259	15.8%	314	21.3%	396	26.0%	462	16.7%	557	20.5%	676	21.4%	800	18.5%	N/A	N/A
Zhenjiang . .	104	19.3%	126	21.2%	149	18.3%	167	12.2%	199	18.9%	231	16.2%	263	13.8%	293	11.3%

Source: _National Bureau of _			Statistics
	2006		2007		2008		2009		2010		2011		2012		2013

	Nominal	Normal	Nominal	Normal	Nominal	Normal	Nominal	Normal	Nominal	Normal	Nominal	Normal	Nominal	Normal	Nominal	Normal
	GDP per	growth	GDP per	growth	GDP per	growth	GDP per	growth	GDP per	growth	GDP per	growth	GDP per	growth	GDP per	growth
	capita	rate	capita	rate	capita	rate	capita	rate	capita	rate	capita	rate	capita	rate	capita	rate

	RMB		RMB		RMB		RMB		RMB		RMB		RMB		RMB
China . . . . .	16,500	16.3%	20,169	22.2%	23,708	17.5%	25,608	7.9%	30,015	16.0%	35,181	17.2%	N/A	N/A	41,805	8.8%
Changzhou . .	37,809	18.2%	44,452	17.6%	51,746	16.4%	56,890	9.9%	67,327	18.3%	77,473	15.1%	85,036	9.8%	92,994	9.4%
Shanghai . . .	54,858	10.5%	62,041	13.1%	66,932	7.9%	69,164	3.3%	76,074	10.0%	82,560	8.5%	85,000	3.0%	90,100	6.0%
Nanjing. . . .	39,376	10.9%	44,972	14.2%	50,855	13.1%	55,290	8.7%	79,390	17.7%	76,263	19.1%	88,523	16.1%	98,011	10.7%
Wuxi . . . . .	57,899	13.5%	65,570	13.2%	73,733	12.4%	81,146	10.1%	92,166	13.6%	107,400	16.5%	117,400	9.3%	124,600	6.1%
Suzhou . . . .	61,500	13.5%	67,387	9.6%	74,670	10.8%	83,696	12.1%	93,043	11.2%	102,129	9.8%	114,029	11.7%	120,000	5.2%
Changsha. . .	32,983	17.2%	39,727	20.4%	50,336	26.7%	56,620	12.5%	66,443	17.3%	79,530	19.7%	89,903	13.0%	99,570	10.8%
Wuhan . . . .	29,899	14.0%	35,582	19.0%	44,290	24.5%	51,144	15.5%	58,961	15.3%	68,315	15.9%	N/A	N/A	N/A	N/A
Zhenjiang . .	35,076	18.8%	41,848	19.3%	49,235	17.7%	54,732	11.2%	64,281	17.4%	73,947	15.0%	83,636	13.1%	92,626	10.7%

Source: National Bureau of Statistics

– 75 –

			Per capita disposable income of urban households (RMB)	Per capita disposable income of urban households (RMB)	Per capita disposable income of urban households (RMB)	Per capita disposable income of urban households (RMB)	Per capita disposable income of urban households (RMB)

	2006	2007	2008	2009	2010	2011	2012	2013

China . . . . .	11,759	13,786	15,781	17,175	19,109	21,810	24,565	26,955
Changzhou . .	16,649	19,089	21,592	23,751	26,269	29,829	33,587	36,946
Shanghai . . .	20,668	23,623	26,675	28,838	31,838	36,230	40,188	43,851
Nanjing . . . .	17,538	20,317	23,123	25,504	28,312	32,200	36,322	39,881
Wuxi . . . . . .	18,189	20,898	23,605	25,027	27,750	31,638	35,663	38,999
Suzhou . . . .	18,532	21,260	23,867	26,320	29,219	33,070	39,079	41,143
Changsha . .	13,924	16,153	18,282	20,864	23,347	26,451	30,288	33,662
Wuhan . . . . .	12,360	14,358	16,712	18,385	20,806	23,738	27,061	N/A
Zhenjiang . .	14,291	16,775	19,044	20,949	23,075	26,637	30,045	32,977

Source: National Bureau of Statistics

Overview of the PRC Property Market

Between 2006 and 2013

Favorable economic conditions in the PRC have contributed to the strong growth of the PRC property market. From 2006 to 2013, investments in real estate development in China increased at a CAGR of 23.7%, and the total GFA of commodity properties sold increased at a CAGR of 11.3%. The table below sets out selected information about the PRC property market over the periods indicated.

										2006-2013
		2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total real estate investment
(RMB billion) . . . . . . . . . . .		1,942	2,529	3,120	3,624	4,826	6,180	7,180	8,601	23.7%
Total GFA under construction
(million sq.m.) . . . . . . . . . .		1,948	2,363	2,833	3,204	4,054	5,068	5,734	1,014	8.9%
Total GFA sold (million	sq.m.). .	619	774	660	948	1,048	1,094	1,113	6,656	19.2%
Residential properties
Total real estate investment
(RMB billion) . . . . . . . . . . .		1,364	1,801	2,244	2,561	3,404	4,432	4,937	5,895	23.3%
Total GFA under construction
(million sq.m.) . . . . . . . . . .		1,517	1,868	2,229	2,153	3,148	3,877	4,290	4,863	18.1%
Total GFA sold (million	sq.m.). .	554	701	593	862	934	965	985	1157	11.1%

Source: National Bureau of Statistics

Prices for real estate in the PRC experienced steady growth between 2006 and 2013, with the average price of commodity properties growing at a CAGR of 9.2% over the same period. The table below sets out average property prices in the PRC over the periods indicated.

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Average price of commodity
properties (RMB per sq.m.) . .	3,367	3,864	3,800	4,681	5,032	5,357	5,791	6,237	9.2%
Average price of residential
properties (RMB per sq.m.) . .	3,119	3,645	3,576	4,459	4,725	4,993	5,430	5,850	9.4%

Source: National Bureau of Statistics

Recent Developments in the PRC Property Market

The PRC property market experienced pricing pressures in the second half of 2011, as a result of the various policies and measures introduced by the PRC government to cool off the market. Transaction volumes remained low in the first half of 2012. According to a report issued by the National Bureau of Statistics, the total

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GFA sold and property sales in China in the six months ended June 30, 2012 decreased by 10.0% and 5.2% compared to the same period in 2011. However, the PRC property market began to show signs of recovery towards the end of the first half of 2012. According to the 70-city property price index released by the National Bureau of Statistics, property prices at these 70 medium to large cities have generally stabilized since June 2012.

Regulatory Milestones of the PRC Property Industry

From time to time, the PRC government has taken actions to tighten its control over the property market. In particular, the PRC government has taken measures to discourage speculation in the residential property market and to increase the supply of affordable housing. The table below sets out the key regulatory milestones of the PRC property industry, including major polices and measures implemented by the PRC government since 2008:

2008 The State Council issued Notice on Promoting the Land Saving and Intensive Use (國務院關於促進節約集約用地的通知) on January 3, 2008, which provided for stricter supervision on land development and regulation of idle land.

In October 2008, the PBOC reduced the minimum down payment requirement to 20% of the purchase price of the underlying property and the minimum mortgage loan interest rate to 70% of the PBOC benchmark interest rate for the purchase of a principal residence with a total GFA less than 90 sq.m.

On October 22, 2008, the State Council, the Ministry of Finance and the SAT jointly announced the decision to reduce the tax expenses of property transactions.

In October 2008, the CBRC issued regulatory notices to restrict trust financing companies from providing trust loans, in form or in nature, to (i) property projects that have not obtained the requisite land use rights certificates, construction land planning permits, construction works planning permits and construction work commencement permits; (ii) property developers that had not been issued with Class 2 qualification certificates by the relevant competent construction authorities; (iii) property projects of which less than 30% of the total investments are funded by the property developers’ own capital (except for affordable housing and commodity apartments, of which 20% of the total investment shall be funded by the developer’s own capital); and (iv) property developers for payment of land premium or for working capital purposes.

2009 The State Council issued a Notice on Adjusting the Capital Ratio of Fixed Assets Investment Project (國務院關於調整固定資產投資項目資本金比例的通知). The Notice provides that the minimum capital requirements for affordable housing and ordinary commodity apartments are 20%, and the minimum capital requirement for other real estate development projects is 30%. These regulations apply to both domestic and foreign investment projects.

2010 On March 8, 2010, the Ministry of Land and Resources instituted measures aimed at ensuring sufficient land supply for government-subsidized residential property.

On April 17, 2010, the State Council announced its decision to implement diverse credit policies for different types of purchases.

On September 21, 2010, the Ministry of Land and Resources and the MOHURD instituted measures to require relevant governmental authorities to (i) strengthen the management of the annual plan for land supply and residential property construction; (ii) accelerate the approval process for land supply and construction for residential properties; (iii) strengthen the management of land grants for residential properties; (iv) strengthen the supervision on land supply and construction of residential properties; and (v) strengthen the supervision and investigation of illegal conduct.

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2011

On September 29, 2010, the PBOC and the CBRC issued the Notice on the Improvement of Diversified Residential Credit Policies (中國人民銀行、中國銀行業監督管理委員會關於完善差別化住房信貸政策有關問題的通知) to require, among other things, all commercial banks to suspend (i) the extension of loans to individuals for purchase of third or subsequent residences and (ii) the extension of loans to non-local residents who cannot provide certificates evidencing payment of local taxes or social insurance for more than one year. For the purchase of a primary residence, the minimum down payment was increased to 30% of the purchase price of the underlying property.

On September 29, 2010, the Ministry of Finance, the SAT and the MOHURD issued the Notice on Adjustment of Preferential Policies for Deed Tax and Individual Income Tax for Real Estate Transactions (財政部、國家稅務總局關於住房和城鄉建設部關於調整房地產交易環節契稅個人所得稅優惠政策的通知) to curb transfers by individuals of residential properties purchased within one year through the levying of individual income tax.

On December 19, 2010, the Ministry of Land and Resources promulgated the Circular on Issues Pertaining to the Strengthened Implementation of Real Estate Land Use Regulatory Policies and the Healthy Development of the Property Market (關於嚴格落實房地產用地調控政策促進土地市場健康發展有關問題的通知) to further regulate the granting of land use rights for real estate development and tighten regulation of idle land.

On November 4, 2010, the MOHURD and SAFE issued the Notice on Further Standardization of the Administration of Housing Purchase by Foreign Entities and Individuals (關於進一步規範境外機構和個人購房管理的通知) to further restrict foreign individuals from purchasing property in the PRC.

On January 27, 2011, the Ministry of Finance and the State Administration of Taxation jointly issued the Notice on Business Tax Imposed on Individuals Transferring Houses (財政部、國家稅務總局關於調整個人住房轉讓營業稅政策的通知) to curb transfers of properties by individuals within five years of purchase.

In January 2011, the State Council issued a notice to further restrict property purchases and strengthen regulations on land transfers, property development projects and idle land. Among other things, the notice (i) increased the minimum down payment for the purchase of a second home from 50% to 60%; (ii) required local governmental authorities to take steps to expand the coverage of low-income housing by increasing supply of low-income housing through construction, redevelopment, purchases and long-term leases and to build 10 million units of low-income housing in 2011; (iii) increased the minimum down payment from 20% to 30% for the purchase of the first residential property of a family if the underlying property has a unit GFA of 90 sq.m. or more; (iv) required that if a property developer failed to obtain the relevant construction permits and failed to commence construction within two years from the designation of land for property development, the relevant land use rights granted be forfeited and an idle land penalty be imposed; (v) prohibited the transfers of land or a property development project if the amount of property development investment (excluding the land premium) incurred is less than 25% of the total investment amount in respect of the project; and (vi) prohibited families holding local residency and owning two or more residential properties and families holding non-local residency and owning at least one residential property or who cannot provide a local tax payment certificate or a social security certificate from purchasing additional residential properties in their local district.

In March 2011, the MOHURD released the Notice on Inspection in respect of Standardized Management of Low-Income Housing Security Policy, requesting all local government authorities to fully understand the importance and long-term nature of the standardized management of low-income housing security policy, continue adopting effective measures, implement management accountability, improve management standards, and set up a comprehensive scientific, orderly, efficient, open and transparent management system.

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In July 2011, MOHURD issued the Notice on Relevant Issues Relating to Enhanced Implementation of Real Estate Control Policies (關於進一步落實房地產調控政策有關問題的函) to enhance the implementation of purchase restrictions in second-tier and third-tier cities and to increase the number of cities subject to property purchase restrictions. This notice set out five criteria and encouraged local governments to, subject to local market conditions, implement property purchase restrictions if three or more of the following criteria are met: (i) prices of new residential units in the relevant city recorded year-on-year increase or recorded month-on-month increase during the six months ended June 30, 2011 according to information provided by the National Bureau of Statistics; (ii) the average price of new residential units in the relevant city in June

2011 had been higher than or closed to the maximum average price of residential units pre-determined by the relevant authorities; (iii) the sales volume of new commodity properties in the relevant city increased significantly from January 2011 to June 2011, as compared with the same period in past year; (iv) the relevant city is located close to major city(ies) with property purchase restrictions implemented and the proportion of non-local purchasers of properties in such city remained high; and (v) state-wide restrictive policies in real estate market had not been fully implemented in the relevant city which resulted in continued and significant increase in property prices and dissatisfaction of local residents.

In addition, the PRC government plans to build 36 million units of low-income housing during its “Twelfth Five-year” period. Through large-scale and nationwide development of low-income housing, it is expected that by the end of the “Twelfth Five-year” period, the coverage of low-income housing in urban cities and counties will reach 20% or above nationwide.

2012 On June 1, 2012, the Ministry of Land and Resources promulgated the revised Measures on the Disposal of Idle Land (閒置土地處置辦法), which became effective on July 1, 2012. Under these measures, if any land parcel constitutes “idle land” due to government-related acts, the holder of the relevant land use rights are required to explain to the relevant municipality or county-level land administrative department(s) the reasons for the land becoming idle, consult the relevant government authorities and rectify the situation accordingly. The means of rectification include but are not limited to the extension of the period permitted for commencing development, the adjustment of the land use and planning conditions or the substitution of the relevant idle land parcels with other land parcels.

2013 On February 26, 2013, the General Office of the State Council promulgated the Notice on Continuing Adjustment and Control of Property Markets (關於繼續做好房地產市場調控工作的通知), which reiterated the importance of controlling property prices and promoting the healthy development of the PRC property market. The notice mandated provincial governments to increase the effectiveness of regulations designed to achieve national property control policies. Key goals are to (i) fine tune existing measures to control property prices, (ii) curb property speculation, (iii) increase the supply of commodity housing, (iv) accelerate the development of affordable housing projects, and (v) manage the market expectation of the property industry and strengthen the credit management of property developers.

Over the years, land premiums have generally been on the rise in China. It is widely expected that land premiums will continue to rise as the PRC economy continues to develop and demolition and resettlement costs continue to increase.

Market Position

National Ranking

We were ranked 26th and 31st among the top property developers in China in term of contracted GFA and contracted sales in 2012, respectively, by China Real Estate Appraisal Centre (中國房地產測評中心) and China Real Estate Information Corporation (中國房產信息集團).

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Regional Rankings

Jiangsu Province

According to a report by the China Index Academy, we were ranked first in Jiangsu Province in 2009 and 2010 and second in 2011 in terms of contracted sales.

Top Five PRC Real Estate Developers by Contracted Sales in Jiangsu Province[(1)]

Ranking	2010	2011	2012	2013

1.	Future Land	China Vanke Co.,	China Overseas	China Overseas
	Development	Ltd.	Land &	Land &
	Holdings Limited		Investment Ltd.	Investment Ltd.
2.	China Vanke Co.,	Future Land	China Vanke Co.,	China Vanke Co.,
	Ltd.	Development	Ltd.	Ltd.
		Holdings Limited
3.	China Overseas	China Overseas	Future Land	Future Land
	Land &	Land &	Development	Development
	Investment Ltd.	Investment Ltd.	Holdings Limited	Holdings Limited
4.	Shimao Property	China Resources	Shimao Property	Shimao Property
	Holdings Limited	Land Limited	Holdings Limited	Holdings Limited
5.	Jiangsu Zhongnan	Jiangsu Zhongnan	Jiangsu Zhongnan	China Resources
	Construction	Construction	Construction	Land Limited
	Group	Group	Company

Source: China Index Academy

Changzhou

According to a report by the China Index Academy, we were ranked first in Changzhou in 2009, 2010 and 2011 in terms of contracted sales and GFA sold of commodity properties.

Top Five PRC Real Estate Developers by Contracted Sales in Changzhou

Ranking	2010	2011	2012

1.	Future Land Development	Future Land Development	Future Land Development
	Holdings Limited	Holdings Limited	Holdings Limited
2.	Longfor Properties Co.,	Longfor Properties Co.,	Longfor Properties Co.,
	Ltd.	Ltd.	Ltd.
3.	Top Spring International	Dalian Wanda Group Co.,	Greenland Group
	Holdings Limited	Ltd.
4.	Jiangsu Huaguang Real	Greenland Group	Jiangsu Huaguang Real
	Estate Group		Estate Group
5.	Century Golden Resources	Top Spring International	Top Spring International
	Group	Holdings Limited	Holdings Company

Source: China Index Academy

(1) Data for contracted sales in Jiangsu Province include data of us and listed real estate companies.

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Top Five PRC Real Estate Developers by GFA Sold of Commodity Properties in Changzhou

Ranking	2010	2011	2012

1.	Future Land Development	Future Land Development	Future Land Development
	Holdings Limited	Holdings Limited	Holdings Limited
2.	Top Spring International	Longfor Properties Co.,	Longfor Properties Co.,
	Holdings Limited	Ltd.	Ltd.
3.	Longfor Properties Co.,	Greenland Group	Greenland Group
	Ltd.
4.	Century Golden Resources	Dalian Wanda Group Co.,	Jiangsu Huaguang Real
	Group	Ltd.	Estate Group
5.	Jiangsu Huaguang Real	Top Spring International	Road King Properties
	Estate Group	Holdings Limited	Holdings Limited

Source: China Index Academy

Shanghai

According to a report by the China Index Academy, we were ranked among the top ten property developers in Shanghai in 2010 and top five in 2011 in terms of contracted GFA of residential properties.

Top Ten PRC Real Estate Developers by Contracted GFA of Residential Properties in Shanghai

Ranking	2010	2011	2012	2013

1.	Greenland Group	Greenland Group	Greenland Group	Greenland Group
2.	Poly Real Estate	China Vanke Co.,	China Vanke Co.,	China Vanke Co.,
	Group Co., Ltd.	Ltd.	Ltd.	Ltd.
3.	China Vanke Co.,	Future Land	Poly Real Estate	Hutchison Whampoa
	Ltd.	Development	Group Co., Ltd.	Property
		Holdings Limited
4.	Dahua Group	Poly Real Estate	Dahua Group Poly	NGS Real Estate
		Group Co., Ltd.	Real Estate Group
			Co., Ltd.
5.	Glorious Property	Gemdale	Future Land	CIFI Holdings
	Holdings	Corporation	Development	(Group) Co., Ltd.
			Holdings Limited
6.	Forte Land Co., Ltd.	Dahua Group	CIFI Holdings	Poly Real Estate
			(Group) Co. Ltd.	Group Co., Ltd.
7.	Future Land	Glorious Property	China Overseas	Future Land
	Development	Holdings	Land &	Development
	Holdings Limited		Investment Ltd.	Holdings Limited
8.	Dalian Wanda Group	Longfor Properties	Shanghai	Sunac Greentown
	Co., Ltd.	Co., Ltd.	Construction	Investment
			Group	Holdings Limited
9.	Gemdale	Dalian Wanda Group	Gemdale	Gemdale
	Corporation	Co., Ltd.	Corporation	Corporation
10.	China Enterprise	China Overseas	China Enterprise	Dahua Group
	Company Ltd.	Land &	Company Ltd.
		Investment Ltd.

Source: China Index Academy

China Index Academy

The above information regarding regional rankings in Jiangsu Province, Changzhou and Shanghai was based on a report by the China Index Academy commissioned by us in August 2012. China Index Academy is a Chinese property research institution, which was jointly established in 2004 by a number of China research institutions, including China Real Estate Index System, Soufun Research Institute, China Villa Index System and Top 10 China Real Estate Research Group.

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Overview of the Yangtze River Delta

The Yangtze River Delta region is one of the most affluent regions in China. It is also widely regarded as the largest regional economy as well as the economic zone in China with the greatest development potential. It is located in the eastern part of China covering the Jiangsu Province, Zhejiang Province and Shanghai, which together account for approximately 1.0% of China’s total land area, 11.1% of China’s total population and approximately 20.8% of China’s total GDP in 2013. The table below sets out the nominal GDP of China and other key economic zones in China for the periods indicated.

				Nominal	GDP (in RMB billion)	GDP (in RMB billion)

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

China . . . . . . . . . . . . . . . . . . . . .	21,631	26,581	31,405	34,090	39,798	47,310	51,932	56,885	14.8%
Yangtze River Delta Region(1). . . .	4,803	5,727	6,651	7,249	8,530	10,062	10,891	11,833	13.7%
Pearl River Delta Region(2) . . . . . .	2,168	2,576	2,995	3,215	3,739	4,372	4,785	5,306	13.6%
Beijing-Tianjin Metropolitan
Region(3) . . . . . . . . . . . . . . . . .	1,258	1,510	1,783	1,967	2,289	2,756	3,069	3,387	15.2%
Chengdu-Chongqing
Economic Zone(4) . . . . . . . . . . .	668	804	974	1,103	1,345	1,681	1,960	2,177	18.4%

Source: National Bureau of Statistics, bureau of statistics of the respective cities

(1) Yangtze River Delta Region includes Shanghai, Jiangsu Province and Zhejiang Province (2) Pearl River Delta Region includes Guangzhou, Shenzhen, Zhuhai, Dongguan, Zhongshan, Foshan, Zhaoqing, Jiangmen and Huizhou (3) Beijing-Tianjin Metropolitan Region includes Beijing and Tianjin (4) Chengdu-Chongqing Economic Zone includes Chengdu and Chongqing

The Yangtze River Delta region has become one of the most prosperous economic zones in China. In June 2010, the State Council issued the “Regional Development Outlook of the Yangtze River Delta” (長江三角洲地區區域規劃綱要), pursuant to which the Yangtze River Delta has been positioned to become the most competitive international, economic, financial, trade and logistics center of China. Acting as the engine of development, Shanghai, situated at the heart of the Yangtze River Delta, has been consolidating resources and competitive strengths from cities in six nearby regions to form an enhanced and consolidated economic development zone of the Shanghai-Nanjing Economic Corridor. The six nearby regions include the “ShanghaiNanjing-Hangzhou Development Zones” (滬寧滬杭沿綫發展帶), the “Yangtze Riverside Development Zone” (沿江發展帶), “Hangzhou Bayside Development Zone” (沿灣發展帶), “Coastal Development Zone” (沿海發展帶), “Nanjing-Huzhou-Hangzhou Development Zone” (寧湖杭發展帶) and the “Taihu Ecological Tourism Area” (沿湖生態服務帶). As a result of the vibrant economic development in the Yangtze River Delta, major cities along the Shanghai-Nanjing Economic Corridor are widely recognized as leading cities in the PRC property market.

Overview of Selected Key Cities

Changzhou

Overview

Changzhou is one of the major manufacturing bases in the Yangtze River Delta, the third largest economy in Jiangsu Province in terms of GDP and one of the most prosperous regions in China. Changzhou is situated in the southern part of Jiangsu Province and at the heart of the Shanghai-Nanjing Economic Corridor in the Yangtze River Delta region, bordering Wuxi to the east, Taihu Lake to the south, Nanjing to the west and the Yangtze River to the north. The city had a total population of approximately 4.7 million at the end of 2012. It covers an area of approximately 4,385 sq.km. According to China Research Society of Urban Development (中國城市發展研究會), Changzhou ranked tenth in the Table of the Most Affluent Sub-provincial Level Cities of China (全國地級市富裕指數排名) and ranked third among the most affluent cities in Jiangsu Province in 2010.

Since the establishment of a state-level high-tech development zone in Xinbei District in 1992, Changzhou’s government has been putting increasing emphasis on developing high-tech industries in the city.

Changzhou has a well-developed transportation infrastructure. In addition to the Beijing- Shanghai High Speed Railway, it is connected to Shanghai and Nanjing by the Shanghai-Nanjing Inter-city High Speed Railway (滬寧城際高鐵).

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The table below sets out selected economic statistics of Changzhou for the periods indicated.

				Nominal	GDP (in	RMB	billion)

											2006-2013
	2006	2007	2008	2009	2010		2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	159	191	227	252	304			358	397	436	15.5%
Real GDP growth rate . . . . . . . . .	15.2%	15.6%	12.4%	11.7%	13.1%		12.2%		11.5%	N/A	N/A
Nominal GDP per capita (RMB) . . .	37,809	44,452	51,746	56,890	67,327		77,473		85,036	92,994	13.7%
Per capita disposable income for
urban households . . . . . . . . . .	16,649	19,089	21,592	23,751	26,269		29,829		33,587	36,946	12.1%
Real estate investment
(RMB billion) . . . . . . . . . . .	17	23	31	31		45		57	60	70	22.4%

Source: National Bureau of Statistics, Changzhou Statistics Bureau

Property market

The table below sets out key statistics related to the property market in Changzhou for the periods indicated.

											2006-2012
			2006	2007	2008		2009	2010	2011	2012	CAGR

Commodity properties
Total GFA completed (million sq.m.) . . . . . . .			4.0	6.0		6.9	7.5	7.3	6.5	N/A	N/A
Total GFA sold (million	sq.m.). . . . . . . . . . .		4.8	5.8		5.0	9.2	9.2	6.6	7.6	8.0%
Sales revenue (RMB billion) . . . . . . . . . . . .			19.1	22.9	22.0		44.6	55.3	48.5	51.5	18.0%
Average price (RMB per		sq.m.) . . . . . . . . . .	3,991	3,944	4,363		4,831	6,041	N/A	N/A	N/A
Residential properties
Total GFA completed (million sq.m.) . . . . . . .			3.0	4.9		5.4	5.5	4.9	N/A	N/A	N/A
Total GFA sold (million	sq.m.). . . . . . . . . . .		4.1	5.1		4.3	8.0	7.8	5.4	6.7	8.5%
Sales revenue (RMB billion) . . . . . . . . . . . .			14.9	19.4	17.5		35.7	44.5	36.9	43.3	19.5%
Average price (RMB per		sq.m.) . . . . . . . . . .	3,645	3,765	4,111		4,448	5,735	6,853	6,516	10.2%
Commercial properties
Total GFA completed (million sq.m.) . . . . . . .			0.52	0.6	0.82		1.25	1.2	N/A	N/A	N/A
Total GFA sold (million	sq.m.). . . . . . . . . . .		0.47	0.45	0.62		0.86	1.0	N/A	N/A	N/A
Sales revenue (RMB billion) . . . . . . . . . . . .			3.4	2.8		3.9	7.1	8.6	N/A	N/A	N/A

Source: National Bureau of Statistics, Changzhou Statistics Bureau

Overview of Jintan – a county level city in Changzhou

Jintan city, being a county-level city within Changzhou, is one of the fastest growing cities in the PRC in terms of economic development. Located at the center of the Nanjing-Shanghai-Hangzhou triangle area, adjacent to Nanjing and Zhenjiang, Jintan covers an area of approximately 975 sq.km. and has a population of 0.55 million at the end of 2012. According to the National Bureau of Statistics, Jintan’s nominal GDP increased from RMB18.2 billion in 2006 to RMB37.4 billion in 2012, representing a CAGR of approximately 12.7%. Jintan’s nominal GDP per capita increased at a CAGR of 14.2% from RMB33,008 in 2006 to RMB67,965 in 2012.

According to the National Bureau of Statistics, sales revenue of commodity properties increased at a CAGR of 25.0% from RMB1.3 billion in 2006 to RMB3.1 billion in 2010, while the average commodity property price increased from RMB2,391 per sq.m. to RMB3,531 per sq.m., at a CAGR of 10.2%, during the same period. Total GFA of commodity properties sold increased from approximately 0.5 million sq.m. in 2006 to approximately 0.9 million sq.m. in 2010, representing a CAGR of 13.4%.

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Local restrictive measures

Changzhou (including Jintan) has no additional local purchase restrictions in place. The General Office of Changzhou government issued the Opinion on Further Improvement of the Control in Real Estate Market (關於進一步做好房地產市場調控工作的意見) on February 28, 2011 to reinforce this position.

Shanghai

Overview

Shanghai is the most important financial and trading center in China as well as one of the fastest growing financial capitals in the world. Shanghai is situated at the heart of the Shanghai-Nanjing Economic Corridor. It is one of the four municipalities in China, covering an area of approximately 6,341 sq.km. and had a total population of approximately 24.2 million at the end of 2013. Shanghai’s population ranked third among all cities in China, after Beijing and Chongqing. It hosted the World Expo in 2010 and is the location of choice for a large number of multi-national corporations seeking to establish headquarters in China.

The city is also China’s most important industrial base and transportation hub and has one of the world’s busiest ports. It is an integral part of both railway and expressway networks in Eastern China. In addition to the Beijing-Shanghai Railway, Shanghai is connected by the Shanghai-Nanjing Expressway and the ShanghaiHangzhou Expressway, which allow quick access from Shanghai to other major economically developed cities in the Yangtze River Delta region. Shanghai is served by two international airports, the Hongqiao International Airport and the Pudong International Airport, with both offering domestic and international flights. Its three major harbors and container ports, including Wai Gao Qiao Free Trade Zone (外高橋保稅區), Wu Song Pier (吳淞碼頭) and Yangshan Deep Water Harbour (洋山深水港), further strengthen Shanghai’s competitive strengths as the nation’s trading and logistics center.

The table below sets out selected economic statistics of Shanghai for the periods indicated, which demonstrates an increase in earnings of the population in the city.

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Nominal GDP (RMB billion) . . . . . .	1,057	1,249	1,407	1,505	1,717	1,920	2,010	2,160	10.8%
Real GDP growth rate. . . . . . . . . . .	12.7%	15.2%	9.7%	8.2%	10.3%	8.2%	7.5%	N/A	N/A
Nominal GDP per capita (RMB). . . .	54,858	62,041	66,932	69,164	76,074	82,560	85,000	90,100	7.3%
Per capita disposable income for
urban households (RMB) . . . . . .	20,668	23,623	26,675	28,838	31,838	36,230	40,188	43,851	11.3%
Real estate investment
(RMB billion) . . . . . . . . . . . . . .	128	131	137	146	198	217	238	282	11.9%

Source: Shanghai Bureau of Statistics

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Property market

The table below sets out key statistics related to the property market in Shanghai for the periods indicated.

											2006-2013
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . . . .		. . . . . . . . .	32.7	33.8	24.8	21.0	19.4	22.4	23.1	22.5	-5.2%
Total GFA sold (million	sq.m.). . . . .		30.3	36.9	23.0	33.7	20.6	17.7	19.0	24	-3.3%
Sales revenue (RMB billion) . . . . . .			217.7	308.9	189.5	433.0	296.0	256.9	266.9	391.2	8.7%
Average price (RMB per		sq.m.) . . . .	7,196	8,361	8,255	12,840	14,400	14,503	14,061	16,300	N/A
Residential properties
Total GFA completed
(million sq.m.) . . . . .		. . . . . . . . .	27.0	27.5	17.6	15.1	14.0	15.5	N/A	14.3	-8.7%
Total GFA sold (million	sq.m.). . . . .		26.2	32.8	19.7	29.3	16.9	14.7	15.9	20.2	-3.6%
Sales revenue (RMB billion) . . . . . .			184.1	270.6	160.8	362.0	240.0	198.2	220.9	326.4	8.5%
Average price (RMB per		sq.m.) . . . .	7,039	8,253	8,182	12,364	14,213	13,448	13,870	16,192	12.6%
Commercial properties
Total GFA completed
(million sq.m.) . . . . .		. . . . . . . . .	2.4	2.6	2.2	2.0	1.8	2.3	N/A	2.5	0.6%
Total GFA sold (million	sq.m.). . . . .		1.9	2.0	1.2	1.3	1.3	1.0	N/A	1.2	-6.4%
Sales revenue (RMB billion) . . . . . .			12.2	13.1	7.8	19.3	19.8	18.2	N/A	22.5	9.1%

Source: National Bureau of Statistics, Shanghai Statistics Bureau

Local restrictive measures

On January 31, 2011, the General Office of the Shanghai government issued the Opinion on Implementing the General Office of the State Council’s Notice on Further Improvement of the Control in Real Estate Market (關於本市貫徹國務院辦公廳關於進一步做好房地產市場調控工作的通知的實施意見). In addition to the nationwide purchase restrictions issued by the State Council, this opinion provides the following purchase restrictions:

Local resident families that own one housing unit are allowed to purchase only one additional housing unit (whether newly built or second-hand);
Sales of properties to local resident families that own two housing units or more are prohibited;
Non-local resident families that own one housing unit and can provide local tax clearance certificates or local social insurance payment certificates for one year or above within the two years prior to the purchase date are allowed to purchase only one additional housing unit (whether newly built or second-hand); and
Sales of properties to non-local resident families that cannot provide local tax clearance certificates or local social insurance payment certificates for one year or above within two years prior to the purchase date or to non-local resident families that two housing units or more are prohibited.

On March 30, 2013, the General Office of the Shanghai government issued the Opinion on Implementing the Notice on Continuing Adjustment and Control of Property Market promulgated by the General Office of the State Council (關於本市貫徹國務院辦公廳關於繼續做好房地產市場調控工作的通知的實施意見). This opinion further provides the detailed restrictions:

prohibiting loans to individuals for the purchase of third (or more) residential properties;
imposing a 20% individual income tax on the gain from the sale of second-hand properties;
continuing to steadily implement personal housing property tax reform;
increasing the ordinary commodity housing land supply. For development projects where small-tomedium size units account for more than 70% of the total units, financial institutions, on the condition of complying with their credit terms, shall give priority to support the development of such projects.

– 85 –

In addition to purchase restrictions, the local tax authorities of Shanghai also require prepayment of LAT by the property developers upon receipt of sale and pre-sale proceeds from property development projects. Such amount of LAT pre-payable by property developers to the Shanghai tax authorities ranges between 2% to 5%, depending on the price and the location of the relevant properties.

Nanjing

Overview

Nanjing, the capital of Jiangsu Province, is an important industrial base in China.

Nanjing is situated in the western end of the Shanghai-Nanjing Economic Corridor in the Yangtze River Delta region. Nanjing borders Yangzhou to the northeast, Zhenjiang to the east and Changzhou to the southeast. As the second largest financial center in the Eastern China region after Shanghai, Nanjing had a total population of approximately 8.2 million at the end of 2012 and covers an area of approximately 6,598 sq.km.

Key industries in Nanjing include electronics, automobiles, petrochemical, iron and steel, and power. Nanjing has the second largest manufacturing capacity in the electronics industry and the petro-chemical industry, and the third largest automobile manufacturing capacity among all cities in China. It is one of the major scientific and educational centers in China and boasts some of the most prominent educational institutions in the region. According to the National Bureau of Statistics, Nanjing ranked sixth among the top 100 PRC cities in terms of competitiveness (中國城市綜合實力百强城市).

The table below sets out selected economic statistics of Nanjing for the periods indicated.

										2006-2013
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	282	334	381	423	501		615	720	801	16.1%
Real GDP growth rate . . . . . . . . .	15.1%	15.7%	12.1%	11.5%	13.1%	12.0%		11.7%	N/A	N/A
Nominal GDP per capita (RMB) . . .	39,376	44,972	50,858	55,290	63,771	76,263		88,525	98,011	13.9%
Per capita disposable income for
urban households (RMB) . . . . .	17,538	20,317	23,123	25,504	28,312	32,200		36,322	39,881	12.5%
Real estate investment
(RMB billion) . . . . . . . . . . .	35	45	51	60	75		87	102	112	18.1%

Source: National Bureau of Statistics, Nanjing Statistics Bureau

– 86 –

Property market

The table below sets out key statistics related to the property market in Nanjing for the periods indicated.

											2006-2012
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		8.1	6.8	10.6	15.2	10.4	11.7	17.0	N/A	13.2%
Total GFA sold (million	sq.m.) . . . .		10.1	11.4	7.0	11.9	8.2	7.7	9.5	N/A	-1.0%
Sales revenue (RMB billion) . . . . .			45.2	60.4	35.9	85.3	78.7	71.5	96.1	N/A	13.4%
Average price (RMB per		sq.m.) . . .	4,477	5,304	5,109	7,185	9,565	9,310	10,116	N/A	N/A
Residential properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		6.7	5.8	8.9	12.3	7.4	8.6	13.6	N/A	12.5%
Total GFA sold (million	sq.m.) . . . .		9.4	10.6	6.6	11.1	7.5	6.8	8.8	N/A	-1.1%
Sales revenue (RMB billion) . . . . .			40.2	53.3	31.7	76.8	69.6	57.3	84.8	N/A	13.2%
Average price (RMB per		sq.m.) . . .	4,270	5,011	4,808	6,893	9,227	8,415	9,675	11,078	14.6%
Commercial properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		0.7	0.3	0.7	1.3	1.2	1.1	1.1	0.8	7.8%
Total GFA sold (million	sq.m.) . . . .		0.4	0.3	0.2	0.4	0.4	0.4	0.3	0.4	-4.7%
Sales revenue (RMB billion) . . . . .			3.0	2.6	2.0	5.1	6.6	5.8	5.2	8.6	12.2%

Source: National Bureau of Statistics, Nanjing Statistics Bureau

Local restrictive measures

On February 19, 2011, the General Office of Nanjing government issued the Notice on Further Improvement of the Control in Real Estate Market (關於進一步做好房地產市場調控工作的通知). In addition to the nationwide purchase restriction issued by the State Council, this notice provides the following purchase restrictions specific to Nanjing:

Local resident families that own one housing unit and non-local resident families who can provide local tax clearance certificates or local social insurance payment certificates for one year or above are allowed to purchase only one additional housing unit (whether newly built or second-hand); and
Sales of properties to (i) local resident families who own two housing units or more, (ii) non-local resident families who own one housing unit or more, and (iii) non-local resident families who cannot provide local tax clearance certificates or local social insurance payment certificates for one year or above are prohibited.

On March 30, 2013, the General Office of the Nanjing government released the Notice on the Pricing Control Target of the Newly Built Commercial Housing during 2013 (市政府關於南京市2013年度新建商品住房價格控制目標的通知), stating that any increase in new commodity housing price in Nanjing during 2013 shall be lower than the actual growth of per capita disposable income of its urban households.

– 87 –

Wuxi

Overview

Wuxi is an internationally renowned industrial base in China and the second largest economy in Jiangsu Province in terms of GDP. Wuxi borders Changzhou to the west and Suzhou to the east. It is the second largest economy in the Jiangsu Province in terms of GDP, had a total population of approximately 6.5 million at the end of 2012 and covers an area of approximately 4,627 sq.km.

Wuxi has a number of large industrial parks designed to promote the high-tech industry, including Wuxi-Singapore Industrial Park and Taihu New Town Science and Education Industrial Park. Because of its strong economic growth in recent years, Wuxi is often referred to as “Little Shanghai”. According to the National Bureau of Statistics, Wuxi is ranked eleventh among all cities in China by GDP in 2013.

The table below sets out selected economic statistics of Wuxi for the periods indicated.

										2006-2013
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	331	388	446	499	579		688	757	807	13.6%
Real GDP growth rate . . . . . . . . .	15.3%	15.3%	12.4%	11.6%	13.2%	11.6%		10.1%	N/A	N/A
Nominal GDP per capita (RMB) . . .	57,899	65,570	73,733	81,146	92,166	107,400		117,400	124,600	11.6%
Per capita disposable income for
urban households (RMB) . . . . .	18,189	20,898	23,605	25,027	27,750	31,638		35,663	38,999	11.5%
Real estate investment
(RMB billion) . . . . . . . . . . .	28	38	45	46	61		88	97	113	22.1%

Source: National Bureau of Statistics, Wuxi Statistics Bureau

Property market

The table below sets out key statistics related to the property market Wuxi for the periods indicated.

											2006-2013
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		7.9	7.4	7.1	7.2	12.1	9.4	8.3	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		6.5	7.7	5.4	11.1	10.5	6.6	9.3	9.1	4.9%
Sales revenue (RMB billion) . . . . .			25.9	35.1	28.9	66.6	81.1	57.2	77.7	71.6	15.6%
Average price (RMB per		sq.m.) . . .	4,000	4,573	5,375	5,997	7,765	8,663	8,385	N/A	N/A
Residential properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		6.1	6.0	5.9	5.5	9.3	7.1	N/A	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		5.5	6.8	4.6	9.8	8.8	5.3	7.8	N/A	N/A
Sales revenue (RMB billion) . . . . .			20.4	29.7	23.3	57.1	65.7	43.1	60.7	N/A	N/A
Average price (RMB per		sq.m.) . . .	3,687	4,363	5,096	5,858	7,462	8,065	N/A	N/A	N/A
Commercial properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		1.5	1.0	0.7	1.1	1.7	1.2	1.3	1.4	-1.0%
Total GFA sold (million	sq.m.) . . . .		0.9	0.8	0.6	1.1	1.3	1.0	0.9	0.8	-1.7%
Sales revenue (RMB billion) . . . . .			4.9	4.4	4.7	8.3	12.5	11.3	12.7	9.2	9.4%

Source: National Bureau of Statistics, Wuxi Statistics Bureau

– 88 –

Local restrictive measures

On February 20, 2011, the General Office of the Wuxi government issued the Notice on Implementing the General Office of the State Council’s Notice on Further Improvement of the Control in Real Estate Market (關於本市貫徹國務院辦公廳關於進一步做好房地產市場調控工作的通知的通知). In addition to the nationwide purchase restrictions issued by the State Council, this notice provides for restrictions similar to those provided by the Nanjing government as stated above. It also provides that non-local residents who migrated to Wuxi pursuant to relevant provincial and municipal talent immigration policies are permitted to purchase only one housing unit in Wuxi.

Suzhou

Overview

Suzhou, a major city in the Shanghai-Nanjing Economic Corridor, is one of the few stops on the Beijing-Shanghai High Speed Railway. Situated in the southern part of Jiangsu Province, Suzhou is located 80 kilometers from downtown Shanghai. It had a total population of approximately 6.5 million at the end of 2013 and covers an area of approximately 8,488 sq.km.

According to the 2010 China Urban Competitiveness Report, Suzhou ranked eleventh in terms of competitiveness among all cities and ranked first among all sub-provincial cities in China. In terms of GDP, Suzhou ranked sixth among all cities in China after Shanghai, Beijing, Guangzhou, Shenzhen and Tianjin.

Suzhou is home to a number of state-level development zones including the China-Singapore Suzhou Industrial Park (中國– 新加坡蘇州工業園區), Kunshan Economic Technical Development Zone (昆山經濟技術開發區), Changshu Economic Technical Development Zone (常熟經濟技術開發區), Wujiang Economic Technical Development Zone (吳江經濟技術開發區), and several state-level hi-tech industrial zones including Suzhou Industry Park (蘇州高新區) and Kunshan Industry Park (昆山高新區). Suzhou is also a famous tourism city with a strong reputation for its ancient Chinese gardens.

The table below sets out selected economic statistics of Suzhou for the periods indicated.

									2006-2013
	2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Nominal GDP (RMB billion) . . . . . . . .	490	585	708	774	923	1,050	1,201	1,300	15.0%
Real GDP growth rate . . . . . . . . . . . . .	15.8%	16.1%	13.2%	11.5%	13.3%	12.0%	N/A	N/A	N/A
Nominal GDP per capita (RMB) . . . . . .	61,500	67,387	74,670	83,696	94,043	N/A	114,029	120,000	10.0%
Per capita disposable income for urban
households (RMB) . . . . . . . . . . . . .	18,532	21,260	23,867	26,320	29,219	33,070	39,079	41,143	12.1%
Real estate investment (RMB billion) . .	47	60	72	72	94	122	126	148	17.8%

Source: National Bureau of Statistics, Suzhou Statistics Bureau

– 89 –

Property market

The table below sets out key statistics related to the property market in Suzhou for the periods indicated.

											2006-2012
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . . . .		. . . . . . . . .	18.2	18.7	14.8	18.8	17.7	15.1	18.3	N/A	N/A
Total GFA sold (million	sq.m.). . . . .		11.1	16.5	10.1	23.5	15.1	12.1	14.6	18.8	4.7%
Sales revenue (RMB billion) . . . . . .			59.9	98.5	57.3	150.7	124.8	109.1	133.6	N/A	14.3%
Average price (RMB per		sq.m.) . . . .	5,377	5,955	5,692	6,423	8,243	9,013	N/A	N/A	N/A
Residential properties
Total GFA completed
(million sq.m.) . . . .		. . . . . . . . .	14.8	14.8	11.3	14.1	12.2	11.0	13.9	N/A	-1.0%
Total GFA sold (million	sq.m.). . . . .		12.9	19.1	8.3	20.1	11.8	9.8	12.6	16.3	-0.4%
Sales revenue (RMB billion) . . . . . .			49.9	82.8	45.9	127.4	97.2	88.8	113.4	N/A	14.7%
Average price (RMB per		sq.m.) . . . .	3,882	4,324	5,533	6,331	8,213	9,028	N/A	N/A	N/A
Commercial properties
Total GFA completed
(million sq.m.) . . . .		. . . . . . . . .	1.8	3.0	2.0	2.3	2.8	2.6	2.2	2.1	3.4%
Total GFA sold (million	sq.m.). . . . .		1.5	2.0	1.4	2.0	2.3	2.1	1.5	1.7	0.0%
Sales revenue (RMB billion) . . . . . .			9.4	13.0	9.7	15.9	20.8	19.6	16.6	19.9	9.9%

Source: National Bureau of Statistics, Suzhou Statistics Bureau

Local restrictive measures

On March 2, 2011, the Suzhou government issued the Notice on Implementing the General Office of the State Council’s Notice on Further Improvement of the Control in Real Estate Market (關於貫徹國務院辦公廳關於進一步做好房地產市場調控工作的通知的通知). In addition to the nationwide purchase restrictions issued by the State Council, this notice provides for restrictions similar to those provided by the Shanghai government as stated above.

Changsha

Overview

Changsha is the capital city of Hunan Province in south-central China. Situated on the lower reaches of Xiang River, a branch of the Yangtze River, Changsha covers an area of 11,819 sq.km. As at the end of 2012, the city had a population of approximately 7.1 million.

Changsha is the center of the Changsha-Zhuzhou-Xiangtan Region (長株潭城市群), which comprises the cities of Changsha, Zhuzhou and Xiangtan. The region covers an area of approximately 28,000 sq.km. and has a population of approximately 7.1 million at the end of 2011. The GDP of Changsha-Zhuzhou-Xiangtan Region reached RMB671.6 billion for the three years ended December 31, 2010, representing 42% of the total GDP of Hunan Province during the same period. The Changsha-Zhuzhou-Xiangtan Region is home to three State-level development zones and two State-level industrial parks.

While Changsha is renowned for its media and cultural industries, it is also an important commercial city in south-central China and has been branded as the “Metropolitan of Construction Machinery of the PRC” (中國工程機械之都). With its well-developed economy and competitive investment environment, Changsha was commended and recognized by KPMG in its “Research Report on The Investment Environment of Changsha” (長沙投資環境研究報告2009) issued in April 2009. In 2010, Changsha is ranked sixteenth by GDP among all cities in China in 2013.

– 90 –

The table below sets out selected economic statistics of Changsha for the periods indicated.

										2006-2013
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	212	258	330	374	455		562	640	715	19.0%
Real GDP growth rate . . . . . . . . .	15.3%	15.7%	15.5%	14.7%	15.5%	14.5%		130%	N/A	N/A
Nominal GDP per capita (RMB) . . .	32,983	39,727	50,336	56,620	66,443	79,530		89,903	99,570	17.1%
Per capita disposable income for
urban households (RMB) . . . . .	13,924	16,153	18,282	20,864	23,347	26,451		30,288	33,662	13.4%
Real estate investment
(RMB billion) . . . . . . . . . . .	30	41	47	50	68		89	103	115	21.2%

Source: National Bureau of Statistics, Changsha Statistics Bureau

Property market

The table below sets out key statistics related to the property market in Changsha for the periods indicated.

											2006-2013
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		5.5	7.0	7.5	13.1	13.9	14.4	N/A	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		7.4	9.9	8.2	14.1	16.8	15.0	15.3	18.4	13.9%
Sales revenue (RMB billion) . . . . .			19.6	32.6	27.3	51.3	74.2	88.2	93.2	116.0	28.9%
Average price (RMB per		sq.m.) . . .	2,644	3,305	3,288	3,648	4,418	5,894	6,101	6,304	N/A
Residential properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		4.8	5.8	6.4	11.0	11.6	11.6	N/A	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		6.9	9.3	8.0	13.6	16.2	13.9	13.9	N/A	N/A
Sales revenue (RMB billion) . . . . .			16.9	29.8	24.6	48.0	70.2	76.4	77.6	94.7	27.9%
Average price (RMB per		sq.m.) . . .	2,431	3,188	3,201	3,533	4,322	5,516	5,603	5,759	13.1%
Commercial properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		0.4	0.6	0.6	0.7	0.7	1.0	1.2	1.1	15.5%
Total GFA sold (million	sq.m.) . . . .		0.3	0.3	0.4	0.3	0.3	0.5	0.7	0.9	17.0%
Sales revenue (RMB billion) . . . . .			2.2	1.9	2.2	2.4	3.1	7.1	9.6	11.9	27.3%

Source: National Bureau of Statistics, Changsha Statistics Bureau

Local restrictive measures

On March 4, 2011, the government office of Changsha city issued “Notice on Issues relating to the Further Strengthening of Management of the Property Market”. In addition to the nationwide purchase restrictions issued by the State Council, this notice provides that:

Families registered in the urban districts of Changsha, Zhuzhou, Xiangtan, Yueyang, Changde, Yiyang, Loudi, and Hengyang are restricted to purchase one additional newly built housing unit of less than 90 sq.m. in these districts, if they already owned one housing unit in these districts;
Non-local families that do not own any housing unit and can provide a certificate of residence in the city are restricted to buy one newly built housing unit of less than 90 sq.m. within the aforesaid districts;
(i) Families that already owned two or more housing units, (ii) non-local families that already owned one or more housing units and (iii) non-local families that cannot provide a certificate of residence in Changsha, are temporarily restricted from buying any newly built housing units of less than 90 sq.m. within the aforesaid districts.

Our property development project in Changsha is located outside the aforesaid urban districts of Changsha and is not subject to the aforesaid local purchase restrictions.

– 91 –

Wuhan

Overview

Wuhan is one of the largest cities and an important center for economy, trade, finance, transportation and information technology in China. It is the capital of Hubei province, situated in the middle of the province. The city had a total population of approximately 10.1 million at the end of 2012. It covers an area of approximately 8,494 sq.km.

Situated at the heart of central China, Wuhan has been a transportation hub between northern and southern China and the coastal cities and western China. It is connected by Wuhan-Guangzhou High-Speed Railway, Hefei-Wuhan Passenger Railway and Zhengzhou-Wuhan High-Speed Railway, which allowed quick access to key cities including Hefei, Guangzhou, Nanjing, Wuhan and Chengdu.

Key industries in Wuhan include optic-electronic, automobile manufacturing, steel manufacturing, new pharmaceutical sector, biology engineering, new materials industry. Domestic trade and retail industries are also strong in Wuhan.

The table below sets out selected economic statistics of Wuhan for the periods indicated.

										2006-2012
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	259	314	396	462	557		676	800	N/A	20.7%
Real GDP growth rate . . . . . . . . .	14.8%	15.6%	15.1%	13.7%	14.7%	12.5%		11.4%	N/A	N/A
Nominal GDP per capita (RMB) . . .	29,899	35,582	44,290	51,144	58,961	68,315		N/A	N/A	N/A
Per capita disposable income for
urban households (RMB) . . . . .	12,360	14,358	16,712	18,385	20,806	23,738		27,061	N/A	14.0%
Real estate investment
(RMB billion) . . . . . . . . . . .	37	46	56	78	102		127	157	N/A	27.5%

Source: National Bureau of Statistics of China, Wuhan Statistics Bureau

Property market

The table below sets out key statistics related to the property market in Wuhan for the periods indicated.

											2006-2012
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		8.7	9.3	8.7	9.5	9.0	10.6	10.5	N/A	3.2%
Total GFA sold (million	sq.m.) . . . .		9.6	11.4	7.3	10.9	12.1	13.2	15.8	N/A	8.7%
Sales revenue (RMB billion) . . . . .			35.5	53.0	35.0	57.9	69.6	95.6	115.8	N/A	21.8%
Average price (RMB per		sq.m.) . . .	3,690	4,664	4,781	5,329	5,746	7,222	N/A	N/A	N/A
Residential properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		7.7	8.1	7.7	8.2	7.3	9.2	9.0	N/A	2.6%
Total GFA sold (million	sq.m.) . . . .		9.1	10.7	6.8	10.4	11.0	11.7	13.9	N/A	7.3%
Sales revenue (RMB billion) . . . . .			32.1	48.3	32.0	54.1	60.8	79.1	95.9	N/A	20.0%
Average price (RMB per		sq.m.) . . .	3,535	4,516	4,681	5,199	5,550	6,768	6,895	7,238	11.8%
Commercial properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		0.5	0.6	0.4	0.4	1.0	0.7	0.9	0.6	10.3%
Total GFA sold (million	sq.m.) . . . .		0.3	0.5	0.2	0.3	0.5	0.9	0.7	1.2	15.2%
Sales revenue (RMB billion) . . . . .			2.4	3.9	1.7	2.9	5.9	11.5	9.7	17.2	26.2%

Source: National Bureau of Statistics, Wuhan Statistics Bureau

– 92 –

Local restrictive measures

On February 22, 2011, the Wuhan Housing Security and Management Bureau issued the Notice on Resolving Issues Relating to Purchase Restriction Policies in Wuhan (市房管局關於調整我市住房限購政策有關問題的通知). In addition to the nationwide purchase restrictions issued by the State Council, this notice provides the following purchase restrictions effective from February 23, 2011 onwards:

Local resident families (including spouses and minor children) that own one housing unit are allowed to purchase only one additional housing unit;
Non-local resident families that do not own any housing unit and can provide local tax clearance certificates or local social insurance payment certificates for one year or above are allowed to purchase only one housing unit;
Sales of properties to local resident families that already own two housing units or more are prohibited; and
Sales of properties to non-local resident families that already own one housing unit or non-local resident families that cannot provide local tax clearance certificates or local social insurance payment certificates for at least one year are prohibited.

Zhenjiang

Overview

Zhenjiang is important transportation hub and an emerging manufacturing, trading and tourist center in the Yangtze River Delta. Zhenjiang is situated on the southern bank of the Yangtze River, bordering Nanjing to the west, Changzhou to the east, and Yangzhou across the river to the north. The city had a total population of 3.2 million at the end of 2012. It covers an area of approximately 3,847 sq.km. With its focus in hi-tech industries, Zhenjiang is gradually developing into an important base for hi-tech manufacturing in the Yangtze River Delta.

The table below sets out selected economic statistics of Zhenjiang for the periods indicated.

										2006-2013
	2006	2007	2008	2009	2010	2011		2012	2013	CAGR

Nominal GDP (RMB billion) . . . . .	104	126	149	167	199		231	263	293	15.9%
Real GDP growth rate . . . . . . . . .	15.2%	15.5%	12.8%	13.7%	13.3%	12.3%		12.8%	N/A	N/A
Nominal GDP per capita (RMB) . . .	35,076	41,848	49,235	54,732	64,281	73,947		83,636	92,626	14.9%
Per capita disposable income for
urban households (RMB) . . . . .	14,291	16,775	19,044	20,949	23,075	26,637		30,045	32,977	12.7%
Real estate investment
(RMB billion) . . . . . . . . . . .	7	8	10	10	11		14	21	N/A	N/A

Source: National Bureau of Statistics

– 93 –

Property market

The table below sets out key statistics related to the property market in Zhenjiang for the periods indicated.

											2006-2013
			2006	2007	2008	2009	2010	2011	2012	2013	CAGR

Commodity properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		2.4	2.5	2.8	3.1	2.3	3.8	4.0	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		2.5	3.0	2.1	4.6	3.7	3.3	4.2	5.9	13.1%
Sales revenue (RMB billion) . . . . .			6.3	9.3	7.3	18.8	20.4	20.5	23.4	35.5	28.0%
Average price (RMB per		sq.m.) . . .	2,587	3,073	3,387	4,091	5,441	6,135	5,564	N/A	N/A
Residential properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		2.1	2.0	2.4	2.7	1.9	2.6	N/A	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		2.3	2.8	1.9	4.2	3.0	2.9	3.9	5.5	13.3%
Sales revenue (RMB billion) . . . . .			5.5	8.1	6.4	16.6	15.5	16.2	20.4	N/A	N/A
Average price (RMB per		sq.m.) . . .	2,444	2,940	3,340	3,999	5,154	5,691	N/A	N/A	N/A
Commercial properties
Total GFA completed
(million sq.m.) . . .	. . . . . . . .		0.2	0.3	0.3	0.2	0.2	N/A	N/A	N/A	N/A
Total GFA sold (million	sq.m.) . . . .		0.1	0.2	0.1	0.3	0.6	N/A	N/A	N/A	N/A
Sales revenue (RMB billion) . . . . .			0.6	1.0	0.6	1.7	4.0	N/A	N/A	N/A	N/A

Source: National Bureau of Statistics, Zhenjiang Statistics Bureau

Local restrictive measures

Zhenjiang has no additional local purchase restrictions in place as of the date of this offering memorandum.

Competition

The property market in China is highly fragmented. Our existing and potential competitors include major domestic developers and, to a lesser extent, foreign developers primarily from Asia, including leading property developers from Hong Kong. We compete with them in relation to a number of factors, including the acquisition of land, brand recognition, financial resources, price, product quality, service quality and other factors. Some of these competitors may have better track records, greater financial, human and other resources, larger sales networks and greater brand recognition. See “Business – Competition” for further details on the competitive landscape of the property market in China.

– 94 –

==> picture [456 x 645] intentionally omitted <==

----- Start of picture text -----

50%
50% 50% 50%
Offshore PRC/Onshore
) ) )
)
100% 100% 100%
4% Development Co., Ltd. Development Co., Ltd. Development Co., Ltd.
Exalt Creation Limited (BVI) Hong Kong Flourishing Development Limited (HK) Zhangjiagang Dingsheng Real Estate Co., Ltd. 張家港鼎盛房地產有限公司 ( Changzhou Huisheng Real Estate 常州匯盛房地產發展有限公司 ( Changzhou Yuesheng Real Estate 常州悅盛房地產發展有限公司 ( Changzhou Zhuosheng Real Estate 常州卓盛房地產發展有限公司 (
Wuxi Future Land Wanbo )
) 96%
100% 100% 100% Business
(BVI) 有限公司
Heroic Time Global Limited Hong Kong Perpetual Development Limited (HK) Danyang Future Land Hongsheng Real Estate Development Co., Ltd. 丹陽新城宏盛房地產發展 ( ) 100% Management Co., Ltd. )
Business
Shanghai Qingpuwuyue 上海青浦吾悅商業管理有限公司 (
) 100% 100% 100%
)
100% 100% Future Land Wanbo 100% Management Co., Ltd.
Changzhou Future Land Wuyue Commercial Management Co., Ltd. 常州新城吾悅商業管理有限公司 ( Suzhou Future Land Wuyue 蘇州新城吾悅商業管理有限公司 (
Hong Kong Prosperity Development Co., Ltd. International Plaza
Public 26.61% Development Limited (HK) Zhenjiang Kaisheng Real Estate 鎮江凱盛房地產發展有限公司 (
Changzhou Wuyue Commercial Management Co., Ltd. 常州吾悅國際廣場商業管理有限公司 (
memorandum: 1.07% 100% 93.78% 100% )
STRUCTURE offering (2) 72.32% Company (Cayman) Hong Kong Achievement Development Limited (HK) 100% ) 90.91% ) 6.22% Changzhou Wealth Zone 97.7% Future Land Holdings Changzhou Future Land Keda 100% 100% Baihuo
Baihuo Co., Ltd.
this “Connected Person” Management Co., Ltd. Investment Co., Ltd. Changzhou Future Land Hongye 常州新城宏業百貨有限公司 ( Changzhou Wuyue
of Directors and Officers Constituting Changzhou Derun Consulting 常州德潤諮詢管理有限公司 ( Changzhou Future Land Wande 常州新城萬德投資有限公司 ( )
date 100% 100% 100% 68.78%
)
CORPORATE the Aceled Limited (BVI) Hong Kong Excellent 1.23% (5)
Development Limited (HK)
of 100% 上海新城萬聖置業有限公司 ( Hongsheng
as 100% 100% Wuhan Future Land
Shanghai Future Land Wansheng Property Co., Ltd. 30%
Development Co., Ltd.
Suzhou Bosheng Real Estate
Infinity Fortune 100% 100% 蘇州博盛房地產發展有限公司 ( 0.91% 0.23%
structure First Priority Group Limited (BVI) Wealth Zone Hong Kong (BVI) (4) )
(1) Limited (BVI) Hong Kong Grand Wang Xiaosong
Flourish Source Holdings Development Limited (HK) ) 100%
36.62%
corporate Hua Sheng Trust Changzhou Jingdian Design Changzhou Fulong
our 100% 100% Development Co., Ltd. Changzhou Future Land Hongye Changzhou Future Land Wanbo Changzhou Future Land Wansheng Changsha Future Land Wanbo Changzhou Future Land Wansheng Business Management Co., Ltd. 常州新城萬盛商業管理有限公司 (
Suzhou Kaituo Real Estate
Chairman Wang Limited (BVI) ) ) 蘇州凱拓房地產發展有限公司 ( 100% 100% 100% 83.33% 100% 100%
forth Emerald Sea Holdings Hong Kong Exaltation
Development Limited (HK)
sets 8.18% 2.07% 58.86% (3)
chart
41.14% Jiangsu Future Land 54 PRC Subsidiaries
domestic shareholders
Public B-share and
16.67%
following
The
----- End of picture text -----

– 95 –

Notes:

(1) Infinity Fortune is beneficially owned by Hua Sheng Trust, a discretionary trust set up by Chairman Wang, the founder of our Group as settlor and Standard Chartered Trust (Singapore) Limited as trustee in favor of his family members.

(2) Includes (a) 16,750,000 shares held by directors (excluding Mr. Wang Zhenhua) and officers of the Company constituting “connected persons” under the Listing Rules and (b) 44,100,000 shares held by Dynasty Snow (PTC) Ltd., the entire share capital of which is owned by Mr. Wang Xiaosong. Dynasty Snow (PTC) Ltd. holds the shares that will vest to such connected persons pursuant to the pre-IPO share award scheme. Mr. Wang Xiaosong also has an interest in 6,000,000 shares out of the 44,100,000 shares held by Dynasty Snow (PTC) Ltd., by virtue of his interest in the share award granted to him under the pre-IPO share award scheme.
(3) The 54 PRC subsidiaries (excluding Shanghai Wanzhicheng, our associated company) are:

	Equity interests
	attributed to our
Name of Operating Subsidiaries	Group

Changzhou Dingjia Property Real Estate Development Co., Ltd.	55.09%
(常州鼎佳房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Chuangjia Real Estate Co., Ltd.	55.02%
(常州新城創佳房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Dongjun Real Estate Development Co., Ltd.	56.99%
(常州新城東郡房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Dongsheng Real Estate Development Co., Ltd.	56.99%
(常州新城東昇房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Jiafeng Market Research Co., Ltd.	54.78%
(常州嘉楓市場調查有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Jinjun Real Estate Co., Ltd.	54.78%
(常州新城金郡房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Real Estate Development Co., Ltd.	54.78%
(常州新城房產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Ruiyi International Co., Ltd.	54.78%
(常州新城瑞壹國際酒店有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Wan Jia Construction Design Co., Ltd.	55.74%
(常州新城萬嘉建築設計事務所有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Assets Operation and Management Co., Ltd.	56.94%
(常州新城資產經營管理有限公司). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Wanjia Real Estate Development Co., Ltd.	54.78%
(常州新城萬佳房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Future Land Zhidi Real Estate Development Co., Ltd.	54.78%
(常州新城置地房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Hengfu Property Co., Ltd. (常州市恒福置業有限公司) . . . . . . . . . . . . . . . . . . . .	54.78%
Changzhou Jiachi Auto Parts Co., Ltd. (常州嘉馳汽車配件有限公司) . . . . . . . . . . . . . . . . . .	54.78%
Changzhou Wanfang Future Land Real Estate Development Co., Ltd.	54.84%
(常州萬方新城房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Wanjia Property Consultancy Co., Ltd. (常州萬嘉置業諮詢有限公司) . . . . . . . .	57.18%
Changzhou Xinlong Chuangzhi Real Estate Development Co., Ltd.	56.70%
(常州新龍創置房地產開發有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changzhou Wanrui Intelligent Systems Engineering Co., Ltd	56.94%
(常州市萬睿智能系統工程有限公司）. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Jiangsu Future Land Property Management Co., Ltd. (江蘇新城物業服務有限公司) . . . . . .	56.94%
Jintan Future Land Wanjun Property Co., Ltd. (金壇市新城萬郡置業有限公司) . . . . . . . . . .	75.96%
Kunshan Future Land Chuangzhi Development Co., Ltd.	54.83%
(昆山新城創置發展有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kunshan Future Land Chuanghong Real Estate Co., Ltd.	57.18%
(昆山新城創宏房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kunshan Future Land Chuangyu Real Estate Co., Ltd.	77.16%
(昆山新城創域房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Kunshan Future Land Wanlong Real Estate Development Co., Ltd.	54.83%
(昆山新城萬龍房地產發展有限公司）. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nanjing Future Land Chuanghong Real Estate Co., Ltd. (南京新城創隆房地產有限公司) . .	55.02%
Nanjing Future Land Chuangjia Real Estate Co., Ltd. (南京新城創嘉房地產有限公司) . . . .	55.02%
Nanjing Future Land Chuangzhi Real Estate Co., Ltd. (南京新城創置房地產有限公司) . . . .	55.02%

– 96 –

	Equity interests
	attributed to our
Name of Operating Subsidiaries	Group

Nanjing Future Land Wanjia Real Estate Co., Ltd. (南京新城萬嘉房地產有限公司) . . . . . . .	55.02%
Nanjing Future Land Yunsheng Real Estate Co., Ltd. (南京新城允升房地產有限公司) . . . .	55.02%
Nanjing Future Land Wanlong Real Estate Co., Ltd. (南京新城萬隆房地產有限公司） . . .	55.02%
Shanghai Fuming Real Estate Development Co., Ltd. (上海富銘房地產開發有限公司). . . . .	55.02%
Shanghai Dongjun Real Estate Development Co., Ltd. (上海東郡房地產開發有限公司) . . .	57.18%
Shanghai Future Land Baojun Property Co., Ltd. (上海新城寶郡置業有限公司) . . . . . . . . .	55.02%
Shanghai Future Land Chuanghong Real Estate Co., Ltd.	55.02%
(上海新城創宏房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shanghai Future Land Chuangjia Property Co., Ltd. (上海新城創佳置業有限公司) . . . . . . .	55.02%
Shanghai Future Land Chuangyu Real Estate Co., Ltd.	55.02%
(上海新城創域房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shanghai Future Land Jinjun Real Estate Co., Ltd. (上海新城金郡房地產有限公司) . . . . . .	55.02%
Shanghai Future Land Wanjia Property Service Co., Ltd.	56.75%
(上海新城萬嘉物業服務有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Shanghai Future Land Wanjia Real Estate Co., Ltd. (上海新城萬嘉房地產有限公司) . . . . .	55.02%
Shanghai Future Land Chuangzhi Real Estate Co., Ltd. (上海新城創置房地產有限公司）.	55.02%
Shanghai Jiadinghuarui Property Co., Ltd (上海嘉定華銳置業有限公司）. . . . . . . . . . . . . .	55.02%
Shanghai Future Land Songjun Real Estate Co., Ltd. (上海新城松郡房地產有限公司）. . .	55.02%
Shanghai Future Land Xudi Real Estate Co., Ltd. (上海新城旭地房地產有限公司）. . . . . .	27.51%
Suzhou Future Land Chuangheng Real Estate Co., Ltd.	57.18%
(蘇州新城創恒房地產有限公司) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Suzhou Future Land Chuangjia Property Co., Ltd. (蘇州新城創佳置業有限公司) . . . . . . . .	57.18%
Suzhou Future Land Wanjia Real Estate Co., Ltd. (蘇州新城萬嘉房地產有限公司) . . . . . . .	55.02%
Suzhou Future Land Chuangzhi Property Co., Ltd (蘇州新城創盛置業有限公司）. . . . . . .	40.03%
Wuxi Future Land Chuangzhi Real Estate Co., Ltd. (無錫新城創置房地產有限公司) . . . . .	57.18%
Wuxi Future Land Wanjia Property Co., Ltd. (無錫新城萬嘉置業有限公司) . . . . . . . . . . . . .	57.18%
Hangzhou Future Land Chuanghong Real Estate Development Co., Ltd.	57.18%
(杭州新城創宏房地產開發有限公司）. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hangzhou Future Land Chuangsheng Real Estate Development Co., Ltd.	57.18%
(杭州新城創盛房地產開發有限公司）. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hangzhou Future Land Dinghong Real Estate Development Co., Ltd.	57.18%
(杭州新城鼎宏房地產開發有限公司）. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Qingdao Future Land Chuangzhi Real Estate Co., Ltd. (青島新城創置房地產有限公司） .	57.18%
Nantong Future Land Chuangzhi Real Estate Co., Ltd. (南通新城創置房地產有限公司） .	44.02%

– 97 –

==> picture [395 x 649] intentionally omitted <==

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Changzhou Wanrui Intelligent Systems Engineering Co., Ltd
( 常州市萬睿智能系統工程有限公司 )
Shanghai Future Land Property Management Co., Ltd.
( 上海新城萬嘉物業服務有限公司 )
Shanghai Future Land Songjun Real Estate Co., Ltd.
( 上海新城松郡房地產有限公司 )
Nantong Future Land Chuangzhi Real Estate Co., Ltd.
( 南通新城創置房地產有限公司 )
Shanghai Future Land Xudi Real Estate Co., Ltd.
( 上海新城旭地房地產有限公司 )
Qingdao Future Land Chuangzhi Real Estate Co., Ltd.
( 青島新城創置房地產有限公司 )
Shanghai Jiadinghuarui Property Co., Ltd
( 上海嘉定華銳置業有限公司 )
Shanghai Future Land Chuangyu Real Estate Co., Ltd.
( 上海新城創域房地產有限公司 )
Shanghai Future Land Chuangzhi Real Estate Co., Ltd.
( 上海新城創置房地產有限公司 )
Shanghai Future Land Chuangjia Property Co., Ltd.( 上海新城創佳置業有限公司 ) Hangzhou Future Land Chuangsheng Real Estate Development Co., Ltd.( 杭州新城創盛房地產開發有限公司 )
Shanghai Future Land Chuanghong Real Estate Co., Ltd.( 上海新城創宏房地產有限公司 ) Hangzhou Future Land Dinghong Real Estate Development Co., Ltd.( 杭州新城鼎宏房地產開發有限公司 )
Shanghai Future Land Baojun Property Co., Ltd.( 上海新城寶郡置業有限公司 ) Hangzhou Future Land Chuanghong Real Estate Development Co., Ltd.
( 杭州新城創宏房地產開發有限公司 )
Shanghai Future Land Jinjun Real Estate Co., Ltd.
( 上海新城金郡房地產有限公司 )
Shanghai Fuming Real Estate Development Co., Ltd.
( 上海富銘房地產開發有限公司 ) Kunshan Future Land Wanlong Real Estate
Development Co., Ltd.
( 昆山新城萬龍房地產發展有限公司 )
Shanghai Dongjun Real Estate Development Co., Ltd.
( 上海東郡房地產開發有限公司 ) Kunshan Future Land Chuangzhi Development Co., Ltd.
( 昆山新城創置發展有限公司 )
Suzhou Future Land Wanjia Real Estate Co., Ltd.
( 蘇州新城萬嘉房地產有限公司 )
Changzhou Wanjia Property Consultancy Co., Ltd.
( 常州萬嘉置業諮詢有限公司 ) Suzhou Future Land Chuangzhi Property Co., Ltd
( 蘇州新城創盛置業有限公司 )
Jintan Future Land Wanjun Property Co., Ltd.
( 金壇市新城萬郡置業有限公司 ) Kunshan Future Land Chuangyu Real Estate Co., Ltd.
( 昆山新城創域房地產有限公司 )
Changzhou Future Land Assets Operation and Management Co., Ltd.
( 常州新城資產經營管理有限公司 ) Kunshan Future Land Chuanghong Real Estate Co., Ltd.
( 昆山新城創宏房地產有限公司 )
Changzhou Future Land Wan Jia Construction Design Co., Ltd.
( 常州新城萬嘉建築設計事務所有限公司 ) Suzhou Future Land Chuangheng Real Estate Co., Ltd.( 蘇州新城創恒房地產有限公司 )
Changzhou Future Land Chuangjia Real Estate Development Co., Ltd.( 常州新城創佳房地產開發有限公司 ) Suzhou Future Land Chuangjia Property Co., Ltd.( 蘇州新城創佳置業有限公司 )
Changzhou Wanfang Future Land Real Estate Development Co., Ltd.
( 常州萬方新城房地產開發有限公司 )
Changzhou Jiafeng Market Research Co., Ltd.
( 常州嘉楓市場調查有限公司 )
Wuxi Future Land Chuangzhi Real Estate Co., Ltd.
( 無錫新城創置房地產有限公司 )
Changzhou Jiachi Auto Parts Co., Ltd.
( 常州嘉馳汽車配件有限公司 )
Wuxi Future Land Wanjia Property Co., Ltd.
( 無錫新城萬嘉置業有限公司 )
Changzhou Future Land Rui Yi International Hotel Co., Ltd.
( 常州新城瑞壹國際酒店有限公司 )
Changzhou Future Land Wanjia Real Estate Development Co., Ltd.
( 常州新城萬佳房地產開發有限公司 ) Nanjing Future Land Chuangjia Real Estate Co., Ltd.
( 南京新城創嘉房地產有限公司 )
Changzhou Hengfu Property Co., Ltd.
( 常州市恒福置業有限公司 ) Nanjing Future Land Chuangzhi Real Estate Co., Ltd.( 南京新城創置房地產有限公司 )
Changzhou Future Land Jinjun Real Estate Co., Ltd.
( 常州新城金郡房地產有限公司 ) Nanjing Future Land Wanlong Real Estate Co., Ltd.
( 南京新城萬隆房地產有限公司 )
Changzhou Future Land Zhidi Real Estate Development Co., Ltd.
( 常州新城置地房地產開發有限公司 ) Nanjing Future Land Chuanglong Real Estate Co., Ltd.
( 南京新城創隆房地產有限公司 )
Changzhou Future Land Dongsheng Real Estate Development Co., Ltd.
( 常州新城東昇房地產開發有限公司 ) Nanjing Future Land Yunsheng Real Estate Co., Ltd.
( 南京新城允升房地產有限公司 )
Changzhou Future Land Dongjun Real Estate Development Co., Ltd.
( 常州新城東郡房地產開發有限公司 ) Nanjing Future Land Wanjia Real Estate Co., Ltd.
( 南京新城萬嘉房地產有限公司 )
Changzhou Dingjia Real Estate Development Co., Ltd.
( 常州鼎佳房地產開發有限公司 )
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– 98 –

BUSINESS

Business Overview

Our Property Development Operations

Our Diversified Product Offerings

Our Competitive Strengths

One of the leading property developers in the Yangtze River Delta

(1) China Index Academy derived the information in the report from its self-developed database, CREIS China Index Database and the database of fdc.soufun.com. These databases, which comprise data from the Housing Administration Real Estate Exchanges Centres of Jiangsu Province, Changzhou and Shanghai and the annual reports and corporate returns of listed real estate companies, have been widely used and relied upon in the PRC property market.

(2) Asset turnover ratio is calculated by dividing revenue during a given year, by the average of total assets at the beginning and the end of the year.

– 99 –

ranked 18th among the “2014 Top 100 China Real Estate Enterprises” (2014年中國房地產百強企業), according to the Top 10 China Real Estate Research Group[(3)] (中國房地產TOP10研究組). Our market-leading position, profitability, and growth potential received further recognition in 2011, as we were named by the China Real Estate Research Association (中國房地產研究會), China Real Estate Industry Federation (中國房地產業協會) and China Real Estate Evaluation Center (中國房地產測評中心) as one of the “Top 20 Real Estate Development Enterprises in China” (中國房地產開發企業20強) and “Top 20 Valuable Real Estate Development Brands in China” (中國房地產開發企業品牌價值20強).

Our rapid asset turnover model and standardized development process enable us to maximize our investment returns and improve our operating cash flows

Diversified product portfolio with a strategic focus on middle class customers in the PRC

(3) The Top 10 China Real Estate Research Group (中國房地產TOP10研究組) is a research team jointly established by the Enterprise Research Institute of the Development Research Centre of the State Council (國務院發展研究中心企業研究所), Tsinghua University Real Estate Research Institute (清華大學房地產研究所) and China Index Research Institute (中國指數研究院).

(4) “China Property Development Enterprise 500” (中國房地產開發企業500強) ranks property developers by operating efficiency based on their operating cycle, inventory cycle, inventory turnover, payable turnover, asset turnover, current asset turnover and fixed asset turnover.

– 100 –

Strategically located land reserves, which we believe provide strong support for continued growth

Highly skilled and experienced management team with a strong commitment to high corporate governance standards

5 These reserves include our projects in Changzhou (including Jintan), Kunshan, Wujiang, Zhenjiang, Suburban areas of Changsha, Nantong, Danyang, Zhangjiagang. See “Industry Overview – Overview of Selected Key Cities” for information on restrictive measures adopted by the local governments of the relevant cities.

– 101 –

Our Business Strategies

Continue to strengthen our leadership position in the Yangtze River Delta region

Focus on increasing quality land reserves at competitive prices

Increase customer satisfaction by improving property management services and enhancing our brand recognition

Diversify our project portfolio by further expanding our commercial property development operations

– 102 –

Attract, retain and motivate talented personnel through systematic training programs and competitive remuneration packages

Recent Developments

Land Acquisitions and Land Premium Payments after December 31, 2013

On March 28, 2014, we entered into land use rights contracts with the local government and acquired the land use rights of a parcel of land in Xianling Lake, Nanjing. The amount of land premium was approximately RMB3,000.0 million, of which RMB1,500.0 million has been paid. The parcel of land occupies an aggregate site area of approximately 147,521 sq.m. and has a total GFA of approximately 368,802 sq.m.

On April 30, 2014, we entered into land use rights contracts with the local government and acquired the land use rights of a parcel of land in Yuhang District, Hangzhou. The amount of land premium was approximately RMB403.2 million, of which RMB201.6 million has been paid. The parcel of land occupies an aggregate site area of approximately 33,598 sq.m. and has a total GFA of approximately 50,397 sq.m.

Trust Financing Arrangements and Bank Borrowings after December 31, 2013

1 We have RMB125.0 million on deposit with Jiangsu International Trust Corporation Limited which can be used to set off the outstanding amount of such trust loans.

– 103 –

Our Performance in the Six Months Ended June 30, 2014

Jiangsu Future Land Performance in the Three Months Ended March 31, 2014

Our Business

Overview of Our Projects

From the establishment of our Group in 1996 through December 31, 2013, we have completed 42 property projects and 20 project phases with an aggregate completed GFA of 15.3 million sq.m. As of December 31, 2013, our property portfolio consisted of 93 property projects located in various cities that were either completed or under various stages of development. As of December 31, 2013, we were developing 51 property projects, which consisted of an aggregate GFA of approximately 3.9 million sq.m. under development and approximately 8.1 million sq.m. for future development. We also acquired and developed certain land parcels with a total GFA of 482,222 sq.m. since December 31, 2013 through entering into land use rights contracts with the relevant local authorities and acquiring shares in an independent third party. We develop and sell a variety of residential properties, including high-rise apartments, mid-rise apartments, townhouses and luxury stand-alone houses. We develop mixed-use complexes for sale and retain a portion for leasing and long-term investment. The following tables set out the geographical breakdown of our property portfolio as of December 31, 2013.

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– 104 –

The following table sets out the geographic breakdown of our contracted sales during the years indicated:

			Year ended	December 31,	December 31,

	2011		2012			2013

	Contracted		Contracted			Contracted
	sales	% of total	sales	% of total		sales	% of total
	(RMB	contracted	(RMB	contracted		(RMB	contracted
	million)	sales	million)		sales	million)	sales

Changzhou . . . . . . . . . . . . . . . .	7,037.3	50.7%	6,620.8		41.7%	5,753.9	28.4%
Shanghai . . . . . . . . . . . . . . . . .	4,414.4	31.8%	4,886.1		30.7%	5,665.0	28.0%
Nanjing . . . . . . . . . . . . . . . . . .	684.7	4.9%	1,207.3		7.6%	2,201.8	10.9%
Suzhou . . . . . . . . . . . . . . . . . . .	730.8	5.3%	1,199.0		7.5%	3,120.7	15.3%
Wuxi. . . . . . . . . . . . . . . . . . . . .	801.7	5.8%	936.4		5.9%	1,458.1	7.2%
Changsha . . . . . . . . . . . . . . . . .	191.4	1.4%	531.4		3.4%	598.3	3.0%
Kunshan . . . . . . . . . . . . . . . . . .	31.9	0.2%	409.1		2.6%	697.5	3.5%
Wuhan . . . . . . . . . . . . . . . . . . .	0.0	0.0%	103.6		0.6%	721.8	3.6%
Zhenjiang. . . . . . . . . . . . . . . . .	0.0	0.0%	0.0		0.0%	27.6	0.1%
Total . . . . . . . . . . . . . . . . . . . .	13,892.2	100.0%	15,893.7		100.0%	20,244.7	100.0%

Notes: Contracted sales exclude sales of car parks.

We develop both residential and commercial properties. We classify a property development project as:

a residential project if 70% or more of the project’s total GFA is designated for residential use (excluding hotels) and less than 100,000 sq.m. of its total GFA is designated for commercial use (including financial, wholesale and retail use, offices, serviced apartments and hotels); and
a mixed-use complex project if (i) more than 30% of the project’s total GFA is designated for commercial use, (ii) 100,000 sq.m. or more of its total GFA is designated for commercial use, or (iii) the property does not fall within the parameters of our residential projects.

In addition, we categorize our residential properties and mixed-use complexes into different series to delineate the different positioning of each type of property.

We categorize our residential properties into four series to target different customer groups:

	FirstHomes (啟航)	SweetHomes (樂居)	DreamHomes (圓夢)	PrestigeHomes (尊享)

Unit GFA . . . . . . . . . . . .	60-90 sq.m.	80-120 sq.m.	90-180 sq.m.	180-430 sq.m.
Target customers . . . . . . .	First time	Young families/	Mid-to-high income	High net worth
	buyers/Newlyweds	Mid-income	households	households
		households
Location . . . . . . . . . . . . .	Suburban/City	Suburban	City centers	Prime locations
	periphery

– 105 –

We categorize our mixed-use complexes into three series, details of which are set forth in the below table:

	International Plaza	City Plaza	Lifestyle Mall
	(國際廣場)	(城市廣場)	(休閑廣場)

Theme/concept . . . . . . .	Luxury shopping mall	Convenience shopping	Restaurants and leisure
		centers	goods retail
Location. . . . . . . . . . . . .	Central business	Emerging business	Emerging business
	districts	districts	districts
Property types addition	Mid- to high-end hotel,	Mid- to high-end hotel	Mid-tier office pace,
to retail and	mid- to high-end	and serviced	hotel and serviced
residential). . . . . . . . .	office and high-end	apartments	apartments
	serviced apartments
Total GFA . . . . . . . . . . .	Approx. 300,000 sq.m.	Approx. 500,000 sq.m.	Approx. 50,000 sq.m.
Commercial GFA . . . . .	Approx. 80,000 to	Approx. 100,000 to	Approx. 30,000 sq.m.
	100,000 sq.m.	120,000 sq.m.

Classifications of Our Property Projects

We generally classify our property projects into three development stages: projects held for future development, projects under development, and completed projects or project phases.

A property is considered to be held for future development when (i) we have obtained the land use rights certificate, but have not obtained the requisite construction permits or (ii) we have signed a land grant contract for the underlying parcel of land with relevant government authorities. Once a project obtains the required project construction commencement permits, it is classified as being under development until a completion certificate is obtained for every phase of the project. As some of our projects comprise multiple-phase developments that are completed on a rolling basis, a project under development may include different phases at various stages of development. A project or project phase is completed when it is issued a completion certificate by the relevant government construction authorities.

A property is considered “sold” when the purchase contract with a customer is executed and the property is delivered to the customer. A property is treated as “pre-sold” when the purchase contract is executed but the property has not yet been delivered to the customer. Delivery is deemed to take place on the date stated on the property delivery document.

Our classification of properties reflects the basis on which we operate our business and may differ from classifications employed by other developers. Each property project or project phase may require multiple land use rights certificates, construction permits, pre-sale permits and other permits and certificates, which may be issued at different times throughout the development process.

– 106 –

Summary of Our Projects

Property portfolio summary

The following table sets forth the GFA breakdown of our property portfolio under various stages of development as of December 31, 2013:

			Held For Future
City	Completed	Under Development	Development

	GFA available for
	sale, lease or use
	by our Group	GFA	GFA

	(sq.m.)	(sq.m.)	(sq.m.)
Changzhou. . . . . . . . . . . . . . . . . . . . . . . . . . .	1,014,857	1,281,798	2,932,181
Shanghai . . . . . . . . . . . . . . . . . . . . . . . . . . . .	279,487	645,077	568,027
Nanjing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	42,910	658,605	360,378
Kunshan. . . . . . . . . . . . . . . . . . . . . . . . . . . . .	86,532	181,449	363,143
Wuxi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	129,120	241,462	137,222
Suzhou. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	138,294	609,323	1,478,341
Changsha . . . . . . . . . . . . . . . . . . . . . . . . . . . .	92,901	201,700	785,198
Wuhan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	60,508	38,883	–
Zhenjiang. . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	16,201	756,611
Hangzhou . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	–	197,874
Nantong . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	–	–	556,728
Total GFA. . . . . . . . . . . . . . . . . . . . . . . . . . .	1,844,610	3,874,498	8,135,703

Attribute GFA. . . . . . . . . . . . . . . . . . . . . . .	1,275,277	2,320,834	6,048,654

Notes:

(1) Includes ancillary GFA, most of which are amenities that are not available for sale or lease.
(2) Does not include the portion of GFA held by us as amenities that is not available for sale or lease.
(3) Comprises the portion of the total GFA which is attributable to us, based on our effective interests in the relevant project.

As of December 31, 2013, we had a total outstanding payable land premium of RMB3,820.5 million, which we intend to pay according to the terms of the respective land grant contracts or purchase agreements.

– 107 –

Completed projects and project phases

The following table sets forth summary information on our completed projects and project phases as of December 31, 2013:

					GFA available
					for sale, lease
			Completion	Completed	or used by	Ownership
Project		Project type	date	GFA	our Group	interest

				(sq.m.)	(sq.m.)	%
Changzhou
1.	Fresh Garden (芳草園) . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2004	47,937	28	54.78
2.	Zhong Liang Town (中涼新村). . . . . . . . . . . . . . . . . . . . . .	Residential	Q3 2003	264,109	1,424	54.78
3.	Four Seasons Future Land (四季新城) . . . . . . . . . . . . . . . . . .	Residential	Q4 2008	404,462	16,031	54.78
4.	People’s Mansion (人民家園) . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2007	154,497	3,584	54.78
5.	Changzhou Future Land Scenic Garden (常州新城逸境) . . . . . . . .	Residential	Q4 2009	174,228	4,284	54.78
6.	Future Land Blue Diamond (新城藍鑽) . . . . . . . . . . . . . . . . .	Residential	Q1 2009	200,616	10,904	54.78
7.	Changzhou Upper East (常州尚東區) . . . . . . . . . . . . . . . . . .	Residential	Q4 2010	209,511	5,397	54.78
8.	Fuhan Garden (府翰苑). . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q1 2011	378,386	3,910	99.43
9.	Future Land Splendid Park (新城熙園) . . . . . . . . . . . . . . . . .	Residential	Q4 2011	125,604	13,193	54.78
10.	Yulong Bay (玉龍灣) . . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q2 2012	284,341	11,433	55.09
11.	Xincheng Geniality Bay (常州清水灣). . . . . . . . . . . . . . . . . .	Residential	Q2 2012	467,315	41,068	56.70
12.	Injoy International Plaza (吾悅國際廣場) . . . . . . . . . . . . . . . .	Mixed-use	Q4 2012	295,688	172,457	97.15
13.	Injoy Lifestyle Plaza (吾悅生活廣場) . . . . . . . . . . . . . . . . . .	Mixed-use	Q4 2012	83,422	4,712	97.15
14.	Future Capital (新城首府) . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2011	297,397	72,925	54.78
15.	Park No. 1 (公園壹號) . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	618,153	27,718	56.99
16.	Lakeview (湖畔春秋) . . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2011	125,408	4,094	99.43
17.	Injoy Plaza (吾悅廣場) . . . . . . . . . . . . . . . . . . . . . . . . . .	Mixed-use	Q4 2012	713,344	227,843	97.15
18.	Changzhou New City Residence (常州新城公館) . . . . . . . . . . . .	Residential	Q3 2012	437,962	17,886	54.78
19.	Golden Future Land (金色新城) . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2007	585,551	9,315	54.78
20.	Future Land Long Island (新城長島) . . . . . . . . . . . . . . . . . .	Residential	Q4 2010	336,520	20,581	54.78
21.	Future Land Southern Metropolis (新城南都) . . . . . . . . . . . . . .	Residential	Q2 2010	871,262	32,222	57.17
22.	Future Land Emporium (新城帝景) . . . . . . . . . . . . . . . . . . .	Residential	Q4 2009	88,245	31,586	54.84
23.	Xincheng Future Town (常州新城域) . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	560,839	51,360	54.78
24.	Changzhou Future Land Golden County (常州新城金郡) . . . . . . . .	Residential	Q4 2012	254,680	19,205	54.78
25.	Future Consequence (常州香悅半島). . . . . . . . . . . . . . . . . . .	Residential	Q3 2014(7) 248,942		53,260	55.01
26.	Changzhou Fragrant (常州香溢瀾橋). . . . . . . . . . . . . . . . . . .	Residential	Q2 2015(7) 287,378		67,985	54.78
27.	Future France (常州香溢紫郡) . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2015(7) 292,799		66,263	54.78
28.	Future Royal Bay (新城禦景灣) . . . . . . . . . . . . . . . . . . . . .	Mixed-use	Q4 2013	124,939	24,188	97.15
Shanghai
29.	Shanghai Future Land Scenic Garden (上海新城逸境園) . . . . . . . .	Residential	Q3 2006	52,640	74	55.01
30.	Future Land Maple Garden (新城楓景園) . . . . . . . . . . . . . . . .	Residential	Q2 2006	158,346	1,196	55.01
31.	Clear Water Garden (清水頤園) . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2008	290,837	125	55.01
32.	Future Land Splendid View Garden (新城尚景苑) . . . . . . . . . . .	Residential	Q4 2006	81,937	876	55.01
33.	Future Land Glorious View Garden (新城盛景園) . . . . . . . . . . .	Residential	Q2 2011	325,918	5,732	55.01
34.	Legend Mansion (上海新城公館). . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	106,531	29,968	55.01
35.	Park View International Community (上海新城金郡)(8) . . . . . . . . .	Residential	Q4 2011	382,859	58,036	55.01
36.	Exalted Uptown (尚上城). . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	171,349	42,090	55.01
37.	Yoho City (悠活城) . . . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	230,128	62,081	55.01
38.	Petrus Hacienda (森蘭碧翠園) . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	183,606	50,197	57.17
39.	Gorgeous Mansion (憶華里) . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	162,679	2,013	55.01
40.	Park View Ivy (上海新城金郡•常春藤) . . . . . . . . . . . . . . . . .	Residential	Q4 2013	71,037	27,098	55.01
Nanjing
41.	Nanjing Future France (南京香溢紫郡) . . . . . . . . . . . . . . . . .	Residential	Q2 2016(7) 104,181		33,003	55.01
42.	Nanjing Future Land Scenic Garden (南京新城逸境) . . . . . . . . . .	Residential	Q4 2004	46,265	39	55.01
43.	New Golden Town (南京新城金郡) . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	132,416	4,048	55.01
44.	Nanjing Upper East (南京尚東區) . . . . . . . . . . . . . . . . . . . .	Residential	Q2 2008	171,561	5,820	55.01

– 108 –

					GFA available
					for sale, lease
			Completion	Completed	or used by	Ownership
Project		Project type	date	GFA	our Group	interest

				(sq.m.)	(sq.m.)	%
Kunshan
45.	Oannes (翡翠灣) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q2 2011	299,720	42,901	55.01
46.	Kunshan Future Land Territory (昆山新城域) . . . . . . . . . . . . . .	Residential	Q4 2011	633,455	43,631	54.83
Suzhou
47.	Suzhou Future France (蘇州香溢紫郡). . . . . . . . . . . . . . . . . .	Residential	Q3 2014(7)	101,441	18,979	57.17
48.	Suzhou Fragrant Legend (蘇州香溢瀾橋) . . . . . . . . . . . . . . . .	Residential	Q4 2016(7)	64,186	22,352	57.17
49.	Suzhou Future Land Golden County (蘇州新城金郡) . . . . . . . . . .	Residential	Q3 2013	584,168	96,963	57.17
Wuxi
50.	Up Town (尚東雅園) . . . . . . . . . . . . . . . . . . . . . . . . . . .	Residential	Q4 2012	328,874	50,780	57.17
51.	Glorious Century Future Land (盛世新城). . . . . . . . . . . . . . . .	Residential	Q4 2011	319,711	20,059	57.17
52.	East China Home Decor Centre (華東家藝中心) . . . . . . . . . . . .	Mixed-use	Q4 2012	149,746	58,282	97.24
Wuhan
53.	Future Land In Spring Live (新城春天里) . . . . . . . . . . . . . . . .	Residential	Q4 2013	177,420	60,507	97.15
Changsha
54.	Changsha Future Land International Metropolis (長沙新城國際花都) .	Mixed-use	Q4 2016(7)	510,934	92,900	97.15
Total	Completed GFA . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		15,324,304		1,844,610
Total	Attributable GFA . . . . . . . . . . . . . . . . . . . . . . . . . . . .			9,469,841	1,275,277

Notes:

(1) Project names set forth above are used for marketing purposes and may not necessarily be the registered name of the projects.

(2) “Completed GFA” is based on figures stated in the project’s surveying reports or completion certificates. It includes salable/leasable amenities.

(3) Certain completed projects have no GFA available for sale, lease or use by our Group as all salable and rentable GFA have been sold, pre-sold or leased out.

(4) “GFA available for sale, lease or use by our Group” does not include amenities that are not available for sale or for lease.

(5) “Ownership interest” is based on our effective ownership interest in the respective project companies.

(6) “Total attributable GFA” comprises the portion of the total GFA that is attributable to us based on our ownership interest in the relevant project.

(7) These projects are partially completed.

(8) Includes Park View International Community A and Park View International Community B.

– 109 –

			interest in the	project	%		54.78	57.17	54.78	54.78	54.84	54.78	54.78	97.15	55.01	54.78	54.78	97.15	98.57	54.78	54.78	97.15
HELD FOR	FUTURE	DEVELOPMENT		Total GFA	(sq.m.)		38,100	3,433	239,110	332,221	370,422	–	45,000	156,042	–	11,788	4,194	498,946	929,779	–	103,785	–
	UNDER	DEVELOPMENT		Total GFA	(sq.m.)		–	35,469	–	10,000	114,037	9,558	–	111,677	120,132	296,508	222,871	–	71,335	273,805	–	16,406
			Estimated Construction	Site Area Schedule	(sq.m.)		248,536 Q1 2002 – Q4 2014	476,007 Q2 2004 – Q2 2014	345,063 Q1 2005 – Q4 2015	338,089 Q3 2006 – Q4 2016	212,299 Q3 2008 – Q2 2016	77,820 Q2 2010 – Q2 2014	233,381 Q2 2010 – Q4 2014	177,660 Q3 2010 – Q4 2015	130,540 Q2 2011 – Q3 2014	185,080 Q2 2011 – Q4 2015	40,650 Q1 2013 – Q4 2014	187,436 Q1 2014 – Q4 2016	323,459 Q3 2013 – Q4 2017	169,035 Q2 2012 – Q2 2015	55,048 Q1 2014 – Q4 2015	55,585 Q3 2012 – Q2 2014
				Project Project Type		Changzhou	1. Golden Future Land (金色新城) ................................................................................ Residential	2. Future Land Southern Metropolis (新城南都) ........................................................... Residential	3. New City Residence (常州新城公館)......................................................................... Residential	4. Future Land Long Island (新城長島)......................................................................... Residential	5. Future Land Emporium (新城帝景) ........................................................................... Residential	6. Future Land Golden County (常州新城金郡) ............................................................ Residential	7. Xincheng Future Town (常州新城域) ........................................................................ Residential	8. Injoy Plaza (吾悅廣場).............................................................................................. Mixed-use	9. Future Consequence (香悅半島) ................................................................................ Residential	10. Future France (香溢紫郡) .......................................................................................... Residential	11. Future Success (Logistics Hub Land Parcel Project) (香溢俊園(儲運公司地塊項目)) ... Residential	12. Xitaihu Road East Project (西太湖大道東側項目) ........................................................... Mixed-use	13. Changzhou In Spring Live (Hutang Project) (常州春天里(湖塘項目))............................ Mixed-use	14. Chanzhou Fragrant Legend (常州香溢瀾橋)..................................................................... Residential	15. New Airport Road Project (新機場路項目) ...................................................................... Mixed-use	16. Future Royal Bay (新城禦景灣)........................................................................................ Mixed-use

– 110 –

			interest in the	project	%	56.68	75.96		55.01	55.01	27.51	55.01	55.01	55.01	55.01	55.01	27.51	55.01		55.01	55.01	55.01		57.17	57.17
HELD FOR	FUTURE	DEVELOPMENT		Total GFA	(sq.m.)	155,898	43,463		91,130	–	–	–	–	–	139,600	95,700	195,107	46,490		82,276	52,650	225,452		117,226	19,996
	UNDER	DEVELOPMENT		Total GFA	(sq.m.)	–	–		26,262	162,048	136,421	94,807	109,328	116,212	–	–	–	–		498,267	–	160,337		9,458	232,004
			Estimated Construction	Site Area Schedule	(sq.m.)	51,966 Q3 2014 – Q4 2016	31,841 –		70,090 Q3 2010 – Q4 2014	137,046 Q4 2010 – Q2 2014	90,013 Q3 2011 – Q2 2014	41,895 Q2 2013 – Q2 2015	64,911 Q2 2013 – Q4 2014	38,366 Q2 2013 – Q2 2015	48,569 Q3 2013 – Q2 2015	32,186 Q3 2013 – Q2 2015	108,393 Q1 2014 – Q2 2016	39,993 Q3 2014 – Q4 2016		239,116 Q4 2011 – Q2 2016	11,627 Q2 2013 – Q4 2015	95,819 Q4 2013 – Q3 2016		143,514 Q4 2010 – Q2 2014	71,566 Q1 2013 – Q4 2014
				Project Project Type		17. Plot No. JXB20130501 in Changzhou (常州JXB20130501地塊)............................... Residential	18. Wanjiantang Project in Jintan (金壇萬建塘項目)....................................................... Mixed-use	Shanghai	19. Park View International Community A (上海新城金郡A).......................................... Residential	20. Gorgeous Mansion (憶華里)...................................................................................... Residential	21. Golden Territory (金色領域)...................................................................................... Residential	22. Fragrant Legend (Hongde Road Project) (香溢瀾庭(洪德路項目)) ............................ Residential	23. Bright Green Land (Yun Chuan Road Project) (昱翠灣(蘊川路項目))....................... Residential	24. Garden House (Rushui South Road Project) (馥華里(茹水南路項目) ........................ Residential	25. Jiading Future Land A06-1 Land Parcel (嘉定新城A06-1項目)................................. Residential	26. Jiading Future Land A06-2 Land Parcel (嘉定新城A06-2項目)................................. Residential	27. Plot in Longxiang Road, Jinshan District (金山龍翔路)............................................ Residential	28. Plot of Yongfeng Street, Songjiang (松江永豐街道).................................................. Residential	Nanjing	29. Nanjing Future France (南京香溢紫郡) ..................................................................... Residential	30. Hubei Road Project (湖北路項目) ............................................................................. Mixed-use	31. Longwan Garden (瓏灣花園)..................................................................................... Residential	Wuxi	32. Up Town (尚東雅園) ................................................................................................. Residential	33. Wuxi Future France (Jincheng East Road Project) (無錫香溢紫峻(金城東路項目))... Residential

– 111 –

			interest in the	project	%		57.17	57.17	57.17	65.00	100.00	100.00		57.17	77.16		97.15		97.15		100.00	100.00	100.00	100.00
HELD FOR	FUTURE	DEVELOPMENT		Total GFA	(sq.m.)		176,068	122,213	126,640	527,845	262,712	262,864		152,646	210,497		785,198		–		241,099	152,632	233,205	129,675
	UNDER	DEVELOPMENT		Total GFA	(sq.m.)		21,098	141,325	263,596	183,303	–	–		181,449	–		201,700		38,883		16,201	–	–	–
			Estimated Construction	Site Area Schedule	(sq.m.)		74,810 Q3 2012 – Q4 2014	82,596 Q4 2013 – Q2 2015	122,464 Q4 2013 – Q4 2017	154,313 Q3 2013 – Q4 2017	65,678 Q1 2014 – Q2 2016	65,716 Q2 2014 – Q2 2016		140,085 Q2 2012 – Q4 2014	65,582 Q2 2013 – Q4 2015		338,840 Q3 2011 – Q4 2016		61,689 Q3 2012 −Q4 2014		90,143 Q1 2014 – Q4 2016	43,609 Q2 2014 – Q3 2016	66,630 Q3 2014 – Q3 2016	37,050 Q4 2014 – Q3 2016
				Project Project Type		Suzhou	34. Suzhou Fragrant Legend (蘇州香溢瀾橋) .................................................................. Residential	35. Shihu Mansion (Sujie Project) (石湖公館(蘇街項目)) ............................................... Residential	36. Future Mangrove Bay (紅樹灣) ................................................................................. Residential	37. Wujiang Injoy Plaza (吳江吾悅廣場)......................................................................... Mixed-use	38. Zhangjiagang 2012-B47-A Land Parcel (張家港2012-B47-A地塊)............................ Mixed-use	39. Zhangjiagang 2012-B47-B Land Parcel (張家港2012-B47-B地塊) ............................ Mixed-use	Kunshan	40. Kunshan Future France (昆山香溢紫郡) .................................................................... Residential	41. Kunshan Future Land Territory West Project (昆山新城域西側項目) ........................ Mixed-use	Changsha	42. Future Land International Metropolis (新城國際花都) .............................................. Mixed-use	Wuhan	43. Future Land In Spring Live (新城春天里)................................................................. Residential	Zhenjiang	44. Dantu Project (丹徒項目) .......................................................................................... Mixed-use	45. Plot No. G1334 in Danyang (丹陽G1334)................................................................. Mixed-use	46. Plot No. G1335 in Danyang (丹陽G1335)................................................................. Mixed-use	47. Plot No. G1336 in Danyang (丹陽G1336)................................................................. Mixed-use

– 112 –

HELD FOR	UNDER FUTURE	DEVELOPMENT DEVELOPMENT		Group’s	Estimated Construction interest in the	Project Project Type Site Area Schedule Total GFA Total GFA project		(sq.m.) (sq.m.) (sq.m.) %	Hangzhou	48. Shunda Road Project in Yuhang District, Hangzhou (餘杭順達路項目) .................... Residential 54,033 Q1 2014 – Q4 2015 – 124,276 57.17	49. Plot No. R21-04 of Hangzhou Shenhua Unit (杭州申花單元R21-04)........................ Residential 11,018 Q3 2014 – Q2 2016 – 22,036 57.17	50. Plot of Future Sci-Tech City in Yuhang District (餘杭未來科技城) .......................... Residential 32,226 Q3 2014 – Q4 2015 – 51,562 57.17	Nantong	51. Nantong Plot No. CR13043 (南通CR13043地塊) ...................................................... Residential 185,575 Q3 2014 – Q4 2016 – 556,728 44.00	Total......................................................................................................................... 6,358,117 3,874,498 8,135,703		Total attributable GFA............................................................................................ 2,320,835 6,048,654			Notes:	(1) “Property held for future development” consists of properties for which (i) we have obtained the relevant land use rights certificate(s), but have not obtained the requisite construction permits or (ii) we have signed	a land grant contract or land grant confirmation letter for the underlying parcel(s) of land with relevant government authority, but have not obtained the land use rights certificate(s).	(2) The end date of the “Estimated construction schedule” indicates the estimated completion date of the property project.	(3) “Total GFA” under development is based on figures stated in the planning permit for construction work.	(4) “GFA Pre-sold” is derived from our internal records. A property is pre-sold when a purchase agreement has been executed for the property, but it has not been delivered.	(5) “Total attributable GFA”, “Total GFA” and “Attributable capital value” include the attributable value of non-salable amenities.	(6) The “Total Attributable GFA” comprises the portion of the total GFA which is attributable to us based on our effective ownership interest in the relevant project.

– 113 –

Contracted sales

Set forth below is a summary of our total contracted sales for the years indicated:

								Year	ended December 31,	ended December 31,

						2011			2012			2013

					Contracted	Contracted	Contracted	Contracted	Contracted	Contracted	Contracted	Contracted	Contracted
Project					GFA	sales	ASP	GFA	sales	ASP	GFA	sales	ASP

						(RMB			(RMB			(RMB
					(sq.m.)	million)	(RMB/sq.m.)	(sq.m.)	million)	(RMB/sq.m.)	(sq.m.)	million)	(RMB/sq.m.)
Future Royal Bay (新城禦景灣)		.	. .	. . . . . . .	–	–	–	55,295	473.7	8,566.9	42,570	396.4	9,311.8
Golden Future Land (金色新城)		.	. .	. . . . . . .	–	–	–	206	1.9	9,323.5	–	–	–
Future Land Southern Metropolis		(新城南都) . .			3,645	17.3	4,733.1	741	5.0	6,707.8	10,298	61.2	5,938.0
Lakeview (湖畔春秋) . . . . . .	.	.	. .	. . . . . . .	17,000	265.7	15,632.0	1,662	20.7	12,454.9	3,443	41.1	11,927.4
Yulong Bay (玉龍灣) . . . . . .	.	.	. .	. . . . . . .	5,751	52.4	9,103.9	41	0.5	13,088.8	127	0.9	7,035.6
Park No. 1 (公園壹號) . . . . .	.	.	. .	. . . . . . .	146,644	861.3	5,873.6	49,041	286.3	5,838.0	31,979	182.8	5,716.3
Changzhou New City Residence
(常州新城公館) . . . . . . .	.	.	. .	. . . . . . .	19,116	211.3	11,054.8	7,615	59.2	7,777.4	2,441	18.6	7,623.9
Future Land Long Island (新城長島)				. . . . . . .	596	5.2	8,760.2	–	–	–	–	–	–
Future Capital (新城首府) . . .	.	.	. .	. . . . . . .	69,672	1,177.7	16,903.9	26,829	373.6	13,924.8	24,298	299.2	12,312.0
Future Land Splendid Park (新城熙園)				. . . . . .	2,247	43.0	19,150.3	3,525	18.7	5,293.8	1,062	12.9	12,097.5
Xincheng Geniality Bay (清水灣)			. .	. . . . . . .	42,427	261.0	6,152.8	551	2.9	5,279.2	106	0.3	2,542.4
Injoy International Plaza (吾悅國際廣場) . . . . .					16,662	246.9	14,816.7	31,030	383.1	12,345.0	14,651	185.1	12,634.0
Changzhou Future Land Golden	County
(常州新城金郡) . . . . . . .	.	.	. .	. . . . . . .	50,521	805.3	15,939.9	56,151	731.0	13,019.1	21,772	281.8	12,941.2
Xincheng Future Town (常州新城域)				. . . . . . .	138,456	883.4	6,380.2	149,524	811.2	5,425.1	17,718	102.6	5,790.8
Injoy Plaza (吾悅廣場) . . . . .	.	.	. .	. . . . . . .	120,239	1,011.0	8,408.2	115,481	850.9	7,368.4	54,259	404.9	7,461.7
Four Seasons Future Land (四季新城)				. . . . . . .	–	–	–	–	–	–	3,931	22.3	5,659.7
Changzhou Future Land Scenic	Garden
(常州新城逸境) . . . . . . .	.	.	. .	. . . . . . .	4,273	20.6	4,831.6	739	4.9	6,644.7	490	3.1	6,327.8
Changzhou Upper East (常州尚東區)				. . . . . . .	1,924	10.3	5,360.9	–	–	–	–	–	–
Fuhan Garden (府翰苑) . . . .	.	.	. .	. . . . . . .	1,130	10.9	9,669.5	–	–	–	–	–	–
Fragrant Legend (香溢瀾橋) . .	.	.	. .	. . . . . . .	–	–	–	102,309	794.9	7,769.9	160,853	1,151.0	7,155.7
Future France (香溢紫郡) . . .	.	.	. .	. . . . . . .	36,041	260.4	7,225.4	121,005	743.6	6,144.9	112,153	679.8	6,061.6
Future Land Consequence (香悅半島)				. . . . . . .	49,678	536.2	10,792.6	92,326	812.6	8,801.3	86,185	745.0	8,644.7
Injoy Lifestyle Plaza (吾悅生活廣場)				. . . . . . .	31,338	352.2	11,238.5	26,550	246.1	9,268.4	2,553	38.1	14,929.1
In Spring Live (春天里）. . .	.	.	. .	. . . . . . .	–	–	–	–	–	–	33,648	203.0	6,032.5
Changzhou Emporium (常州帝景)			. .	. . . . . . .	–	–	–	–	–	–	41,184	639.1	15,519.2
Future Success (香溢俊園) . .	.	.	. .	. . . . . . .	–	–	–	–	–	–	35,237	284.9	8,085.4
People’s Mansion (人民家園) .	.	.	. .	. . . . . . .	346	5.1	14,626.6	–	–	–	–	–	–
Sub-total . . . . . . . . . . . . .	.	.	. .	. . . . . . .	757,706	7,037.3	9,287.6	840,621	6,620.8	7,876.0	700,955	5,753.9	8,208.6

Shanghai
Park View International Community B
(上海新城金郡B) . . . . . .	.	.	. .	. . . . . . .	59,006	839.6	14,226.6	87,158	1,253.0	14,375.8	17,264.9	315.1	18,248.6
YOHO City (悠活城) . . . . . .	.	.	. .	. . . . . . .	56,535	818.2	14,471.8	6,753	91.6	13,557.6	15,318	205.2	13,396.4
Gorgeous Mansion (憶華里) . .	.	.	. .	. . . . . . .	54,114	894.8	16,535.1	59,944	899.9	15,012.2	16,830	489.0	29,053.0
Clear Water Garden (清水頤園)	.	.	. .	. . . . . . .	–	–	–	92	1.0	11,375.7	–	–	–
Future Land Glorious View Garden
(新城盛景園) . . . . . . . . .	.	.	. .	. . . . . . .	2,662	34.2	12,853.2	–	–	–	–	–	–
Exalted Uptown (尚上城) . . .	.	.	. .	. . . . . . .	65,468	820.1	12,527.3	49,646	539.0	10,856.8	5,446	101.7	18,668.4
Legend Mansion (上海新城公館)		.	. .	. . . . . . .	25,145	512.8	20,392.7	26,890	550.8	20,485.1	20,411	425.2	20,829.6
Petrus Hacienda (森蘭碧翠園)	.	.	. .	. . . . . . .	1,735	60.0	34,605.4	53,073	1,550.8	29,220.9	63,815	2,277.7	35,692.4
Park View International Community A
(上海新城金郡A•常春藤) . .	.	.	. .	. . . . . . .	32,342	434.7	13,440.7	–	–	–	32,062.7	593.5	18,511.2
Fragrant Legend (香溢瀾庭) . .	.	.	. .	. . . . . . .	–	–	–	–	–	–	31,256	644.2	20,611.1
Bright Green Land (翌翠灣) . .	.	.	. .	. . . . . . .	–	–	–	–	–	–	32,064	473.7	14,773.3
Garden House (馥華里) . . . .	.	.	. .	. . . . . . .	–	–	–	–	–	–	7,665	139.8	18,233.4
Sub-total . . . . . . . . . . . . .	.	.	. .	. . . . . . .	297,007	4,414	14,863	283,555	4,886	17,232	242,133	5,665.0	23,396.1

– 114 –

						Year	ended December 31,	ended December 31,

			2011				2012			2013

		Contracted	Contracted		Contracted	Contracted	Contracted	Contracted	Contracted	Contracted	Contracted
Project		GFA	sales		ASP	GFA	sales	ASP	GFA	sales	ASP

			(RMB				(RMB			(RMB
		(sq.m.)	million)		(RMB/sq.m.)	(sq.m.)	million)	(RMB/sq.m.)	(sq.m.)	million)	(RMB/sq.m.)
Nanjing
New Golden Town (南京新城金郡)	. . . . . . . .	48,004	548.9		11,434.2	43,765	469.3	10,723.0	5,231	67.5	12,909.1
Nanjing Upper East (南京尚東區) .	. . . . . . . .	1,014		7.7	7,619.3	–	–	–	–	–	–
Nanjing Future France (南京香溢紫郡) . . . . . .		19,727	128.0		6,491.1	98,686	738.0	7,478.4	200,070	1,797.4	8,984.0
Longwan Garden (龍灣花園) . . . .	. . . . . . . .	–		–	–	–	–	–	20,014	336.8	16,829.4
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	68,745	684.7		9,959.5	142,451	1,207.3	8,475.2	225,315	2,201.8	9,772.0

Kunshan
Kunshan Future Land Territory (昆山新城域) . .		5,453	31.2		5,724.9	310	1.8	5,512.0	2,676	22.3	8,338.6
Oannes (翡翠灣) . . . . . . . . . . . .	. . . . . . . .	90		0.6	7,200.0	100	0.3	3,497.3	–	–	–
Kunshan Future France (昆山香溢紫郡) . . . . . .		–		–	–	61,881	407.4	6,583.5	90,243	675.2	7,482.4
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	5,543	31.9		5,748.9	62,291	409.5	6,573.2	92,918	697.5	7,507.0

Suzhou
Fragrant Legend (香溢瀾橋) . . . . .	. . . . . . . .	–		–	–	11,175	110.0	9,841.3	119,433	1,181.3	9,890.9
Suzhou Future Land Golden County
(蘇州新城金郡) . . . . . . . . . .	. . . . . . . .	88,751	730.8		8,234.8	131,409	1,088.7	8,284.9	26,144	231.1	8,838.7
Wujiang Injoy Plaza (吳江吾悅廣場)	. . . . . . .	–		–	–	–	–	–	92,055	756.5	8,218.1
Future Mansion (新城公館) . . . . .	. . . . . . . .	–		–	–	–	–	–	46,530	532.4	11,442.2
Future Mangrove Bay (紅樹灣) . . .	. . . . . . . .	–		–	–	–	–	–	49,404	419.4	8,488.6
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	88,751	730.8		8,234.8	142,584	1,198.7	8,406.9	333,563	3,120.7	9,355.6

Wuxi
Glorious Century Future Land (盛世新城) . . . .		19,663	241.4		12,278.6	523	3.1	5,859.5	558	3.3	5,862.3
Up Town (尚東雅園) . . . . . . . . .	. . . . . . . .	42,573	353.5		8,302.2	86,000	652.4	7,585.8	99,813	763.7	7,650.9
East China Home Decor Centre
(華東家藝中心) . . . . . . . . . .	. . . . . . . .	14,174	206.8		14,591.1	23,879	281.0	11,766.0	10,600	91.1	8,589.4
Future France (香溢紫峻) . . . . . .	. . . . . . . .	–		–	–	–	–	–	77,932	600.1	7,700.5
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	76,409	801.7		10,492.0	110,402	936.5	8,481.7	188,904	1,458.1	7,718.7

Changsha
Future Land International Metropolis
(新城國際花都) . . . . . . . . . .	. . . . . . . .	53,294	191.4		3,592.1	134,523	531.4	3,950.0	138,180	598.3	4,329.9
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	53,294	191.4		3,592.1	134,523	531.4	3,950.0	138,180	598.3	4,329.9

Wuhan
Future Land Live In Spring (新城春天里) . . . .		–		–	–	14,113	103.6	7,343.9	89,993	721.8	8,020.9
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	–		–	–	14,113	103.6	7,343.9	89,993	721.8	8,020.9

Zhenjiang
Zhenjiang Future Land Exalted Uptown
(鎮江新城尚上城) . . . . . . . . .	. . . . . . . .	–		–	–	–	–	–	3,399	27.6	8,133.0
Sub-total . . . . . . . . . . . . . . . .	. . . . . . . .	–		–	–	–	–	–	3,399	27.6	8,133.0

Total . . . . . . . . . . . . . . . . . .	. . . . . . . .	1,347,802	13,897.3		10,311.1	1,730,540	15,893.7	9,184.2	2,015,360	20,244.6	10,045.2

Car parks . . . . . . . . . . . . . . .	. . . . . . . .	75,920	103.6		1,364.0	125,499	241.2	1,922.3	190,410	379.5	1,992.9
Grand total . . . . . . . . . . . . . .	. . . . . . . .	1,347,456	13,892.2			1,856,039	16,134.9	–	2,205,770.2	20,624.1

(1) The 2012 contracted results include the contracted sales of Park View International Community A.

As a result of weaker macroeconomic conditions in the recent years, the contracted ASP of our properties decreased 10.9% from RMB10,309.9 per sq.m. in 2011 to RMB9,184.2 per sq.m. in 2012, and increased 9.4% to RMB10,045.2 per sq.m. in 2013.

– 115 –

Our Property Development Projects in Changzhou ( 常州 )

(1) Golden Future Land ( 金色新城 )

Golden Future Land is a residential project in our “SweetHomes” series. It is located at the heart of Changzhou adjacent to the Yanling business district (延陵商圈). This development offers its residents the scenic views of Guan River (關河) which it borders to the north. It is well-connected to transportation facilities, including many public bus lines and BRT stops. It is located close to a number of primary and secondary schools in the district.

We entered into land use rights contracts with respect to Golden Future Land in February 2001, July 2001 and September 2003. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB320.6 million.

The project occupies an aggregate site area of approximately 248,536 sq.m. and has an expected GFA (including saleable and non-saleable GFA) of approximately 623,651 sq.m.

As of December 31, 2013, this project had 585,551 sq.m. of completed GFA, of which 9,315 sq.m. remained available for sale.

According to our development plans, the properties held for future development had an expected GFA of approximately 38,100 sq.m. as of December 31, 2013.

(2) Future Land Southern Metropolis ( 新城南都 )

Future Land Southern Metropolis is a residential project in our “SweetHomes” series.

Future Land Southern Metropolis is located in the central business district of Wujin, close to Nantian Recreational and Shopping Complex (南田休閒購物公園). It borders Wujin District’s government offices and Changzhou University City (常州大學城) to the south and the popular tourist attraction of Chunqiu Yancheng Cultural Relics (春秋淹城遺址) and Yancheng Forest Park (淹城森林公園) to the west. It is well-connected to transportation facilities, including many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Future Land Southern Metropolis in May 2001, May 2003 and April 2009. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB290.6 million.

The project occupies an aggregate site area of approximately 476,007 sq.m. and has an expected GFA (including saleable and non-saleable GFA) of approximately 916,200 sq.m.

As of December 31, 2013, this project had 871,262 sq.m. of completed GFA, of which 32,222 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA (including saleable and non-saleable GFA) of approximately 35,469 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 3,433 sq.m. as of December 31, 2013.

(3) Lakeview ( 湖畔春秋 )

Lakeview is a residential project in our “PrestigeHomes” series. It offers low-density residential villas in the Xitaihu Grand Scenery Area (西太湖大型風景區), adjacent to the popular tourist attraction of Chunqiu Yancheng Cultural Relics (春秋淹城遺址). It is located in proximity to the Yanjiang Expressway (沿江高速) and the exits of Changzhou West Raocheng Expressway (常州西繞城高速).

We entered into land use rights contracts with respect to Lakeview in June 2003. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB136.9 million.

The project occupies an aggregate site area of approximately 227,362 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 125,408 sq.m., of which 4,094 sq.m. remained available for sale.

– 116 –

(4) Park No. 1 ( 公園壹號 )

Park No. 1 is a residential project in our “FirstHomes” series.

Park No. 1 is located in the center of Qishuyan District, adjacent to the Qishuyan District government offices. It is adjacent to and also offers its residents scenic views of the Lucheng Yuxiu Wetlands Park (潞城毓秀濕地公園). It is well-connected to transportation facilities, including many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Park No. 1 in December 2005 and March 2007. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB338.0 million.

The project occupies an aggregate site area of approximately 266,330 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 618,153 sq.m. of completed GFA. of which 27,718 sq.m. remained available for sale.

(5) Changzhou New City Residence ( 常州新城公館 )

New City Residence is a residential project in our “DreamHomes” series. It is located in the central business district of Wujin District, in proximity to the Wujin District’s government offices and Nantian Park (南田公園) and is equipped with a wide variety of amenities such as department stores. It is well-connected to transportation facilities, including BRT stops.

We entered into land use rights contracts with respect to Changzhou New City Residence in December 2001, January 2005, August 2005 and March 2006. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB405.5 million.

The project occupies an aggregate site area of approximately 345,063 sq.m. and has an expected GFA (including saleable and non-saleable GFA) of approximately 677,072 sq.m.

As of December 31, 2013, this project had 437,962 sq.m. of completed GFA, of which 17,886 sq.m. remained available for sale.

According to our development plans, the properties held for future development had an expected GFA of approximately 239,110 sq.m. as of December 31, 2013.

(6) Future Land Long Island ( 新城長島 )

Future Land Long Island is a residential project in our “SweetHomes” series. It adjoins Wujin District and the city center of Changzhou, bordering Beijing-Hangzhou Canal (京杭大運河) to the south and Jiangsu Vocational and Educational Institute to the west. It is well-connected by three major roads that enhance its accessibility.

We entered into land use rights contracts with respect to Future Land Long Island in November 2002. As of December 31, 2013, we had fully paid the land premium.

The project occupies an aggregate site area of approximately 338,089 sq.m. and has an expected GFA (including saleable and non-saleable GFA) of approximately 668,741 sq.m.

As of December 31, 2013, this project had 336,520 sq.m. of completed GFA, of which 20,581 sq.m. remained available for sale.

According to our development plans, the properties held for future development had an expected GFA of approximately 332,221 sq.m. as of December 31, 2013.

– 117 –

(7) Future Capital ( 新城首府 )

Future Capital is a residential project in our “PrestigeHomes” series. Future Capital is situated in the high-end commercial and residential enclave of Zhonglou District (鐘樓區), surrounded by five-star hotels and high-end shopping centers. Amenities around this project also include educational institutes and municipal secondary schools. It is well-connected to transportation facilities, including many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Future Capital in December 2006. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB349.0 million.

The project occupies an aggregate site area of approximately 92,100 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 297,397 sq.m., of which 72,925 sq.m. remained available for sale.

(8) Future Land Emporium ( 新城帝景 )

Future Land Emporium is a residential project in our “PrestigeHomes” series. It is located in the central business district of the Wujin District, bordering the Nantian Recreational and Shopping Complex (南田休閒購物公園) to the east, the Wujin District’s government offices to the south and the popular tourist attraction of the Chunqiu Yancheng Cultural Relics (春秋淹城遺址) and the Yancheng Forest Park (淹城森林公園) to the west. It is well-connected to transportation facilities, including many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Future Land Emporium in February 2007. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB280.8 million.

The project occupies an aggregate site area of approximately 212,299 sq.m. and has an expected GFA (including saleable and non-saleable GFA) of approximately 572,704 sq.m.

As of December 31, 2013, this project had 88,245 sq.m. of completed GFA, of which 31,586 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA (including saleable and non-saleable GFA) of approximately 114,037 sq.m., and we had not commenced sales of these properties.

According to our development plans, the properties held for future development had an expected GFA of approximately 370,422 sq.m. as of December 31, 2013.

(9) Changzhou Future Land Golden County ( 常州新城金郡 )

Changzhou Future Land Golden County is a residential project in our “DreamHomes” series. It is located in Tianning District with a number of high-end department stores and star-rated hotels in its vicinity, and close to a number of public facilities such as schools and hospitals.

We entered into land use rights contracts with respect to Changzhou Future Land Golden County in September 2007. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB430.0 million.

The project occupies an aggregate site area of approximately 77,820 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 261,555 sq.m.

As of December 31, 2013, this project had 254,680 sq.m. of completed GFA, of which 19,205 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA (including saleable and non-saleable GFA) of approximately 9,558 sq.m.

– 118 –

(10) Xincheng Future Town ( 常州新城域 )

Xincheng Future Town is a residential project in our “FirstHomes” series.

Xincheng Future Town is located in the central commercial district of Wujin District, in proximity to a number of major roads and public bus lines. It is easily accessible from and closely connected to Changzhou city center. It is surrounded by a number of amenities including retail stores and shopping centers.

We entered into land use rights contracts with respect to Xincheng Future Town in November 2006. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB437.6 million.

The project occupies an aggregate site area of approximately 233,381 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 605,312 sq.m.

As of December 31, 2013, this project had 560,839 sq.m. of completed GFA, of which 51,360 sq.m. remained available for sale.

According to our development plans, the properties held for future development had an expected GFA of approximately 45,000 sq.m. as of December 31, 2013.

(11) Injoy Plaza ( 吾悅廣場 )

Injoy Plaza is a mixed-use complex project in our “City Plaza” series. It is located in the central business district of Wujin District. This project is well-connected to transportation facilities and is located in proximity to many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Injoy Plaza in December 2009. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB668.0 million.

The project occupies an aggregate site area of approximately 177,660 sq.m. and has a total GFA of approximately 981,063 sq.m.

As of December 31, 2013, this project had 713,344 sq.m. of completed GFA, of which 227,843 sq.m. remained available for sale/lease including 163,526 sq.m. held as investment properties.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 111,677 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 156,042 sq.m. as of December 31, 2013.

(12) Future Land Consequence ( 香悅半島 )

Future Land Consequence is a residential project in the “DreamHomes” series. It is located near the Zhonglou District government offices and Changzhou’s largest wetland park, Qingfeng Park (青楓公園). It is well-connected to transportation facilities, including many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Future Land Consequence in January 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB836.0 million.

The project occupies an aggregate site area of approximately 130,540 sq.m. and has a total GFA of approximately 369,074 sq.m.

As of December 31, 2013, this project had 248,943 sq.m. of completed GFA, of which 53,260 sq.m. remained available for sale/lease.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 120,132 sq.m.

– 119 –

(13) Future France ( 香溢紫郡 )

Future France is a residential project in our “SweetHomes” series. It is located near the city center of Changzhou and the High-speed Railway Station, overlooking scenic views of the Heng Tang River Wetlands (橫塘河原生態濕地) and of the Crystal Garden (水晶公園). Conveniently located within walking distance of the Beijing-Shanghai High Speed Railway Changzhou Station, Future France is well-connected to major inter-city transportation facilities, as well as many public bus lines and BRT stops. It is also surrounded by amenities such as supermarkets.

We entered into land use rights contracts with respect to Future France in March 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB556.0 million.

The project occupies an aggregate site area of approximately 185,080 sq.m. and has a total GFA of approximately 584,095 sq.m.

As of December 31, 2013, this project had 292,799 sq.m. of completed GFA, of which 66,263 sq.m. remained available for sale/lease.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 296,508 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 11,788 sq.m. as of December 31, 2013.

(14) Future Success (Logistics Hub Land Parcel Project) ( 香溢俊園 ( 儲運公司地塊項目 ))

Future Success is a residential project in our “DreamHomes” series. It is located east of the city center of Changzhou, bordering Hongmei Park (紅梅公園) and close to Wenhua Gong Commercial District (文化宮商圈). It is well-connected to transportation facilities, including many public bus lines and BRT stops, as well as public amenities such as supermarkets and furniture plazas.

We entered into land use rights contracts with respect to Logistics Hub Land Parcel Project in June 2011. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB290.0 million.

The project occupies an aggregate site area of approximately 40,650 sq.m. and has a total GFA of approximately 227,065 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 222,871 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 4,194 sq.m.

(15) Xitaihu Road East Project ( 西太湖大道東側項目 )

Xitaihu Road East Project is a mixed-use complex project in our “City Plaza” series. It is located in Xitaihu Grand Scenery Area (西太湖大型風景區), adjacent to the popular tourist attraction of Chunqiu Yancheng Cultural Relics (春秋淹城遺址). It is located in proximity to the Yanjiang Expressway (沿江高速) and the exits of Changzhou West Raocheng Expressway (常州西繞城高速).

We entered into land use rights contracts with respect to Xitaihu Road East Project in May 2011. The amount of land premium was approximately RMB839.7 million, of which RMB483.4 million had been paid as of December 31, 2013.

The project occupies an aggregate site area of approximately 187,436 sq.m. and has a total GFA of approximately 498,946 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

– 120 –

(16) Changzhou In Spring Live (Hutang Project) ( 常州春天里 ( 湖塘項目 ))

Changzhou In Spring Live (Hutang Project) is a mixed-use complex project in our “City Plaza” series. It is located in the central business district of Wujin District. It is also located close to a variety of commercial amenities and a number of key municipal primary and secondary schools.

We entered into land use rights contracts with respect to Hutang Project in July 2011. The amount of land premium was approximately RMB1,818.6 million, of which RMB974.9 million had been paid as of December 31, 2012.

The project occupies an aggregate site area of approximately 323,459 sq.m. and has a total GFA of approximately 1,001,114 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 71,335 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 929,779 sq.m.

(17) Fragrant Legend ( 香溢瀾橋 )

Changzhou Fragrant Legend is a residential project in our “DreamHomes” series. It is located in the central business district of Wujin District, surrounded by a number of commercial amenities and reputable primary and secondary schools.

We entered into land use rights contracts with respect to Fragrant Legend in December 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB1,024.4 million.

The project occupies an aggregate site area of approximately 169,035 sq.m. and has a total GFA of approximately 541,873 sq.m.

As of December 31, 2013, this project had 287,378 sq.m. of completed GFA, of which 67,985 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 273,805 sq.m.

(18) New Airport Road Project ( 新機場路項目 )

New Airport Road Project is a mixed-use complex project in our “Lifestyle Mall” series. The project adjoins Xinbei District and the central district of Changzhou, close to Longjiang Road (龍江路) and Waihuan Elevated Expressway (外環高架). It is also located in proximity to a number of commercial amenities.

We entered into land use rights contracts with respect to New Airport Road Project in September 2004. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB29.5 million.

The project occupies an aggregate site area of approximately 55,048 sq.m. and has a total GFA of approximately 103,785 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(19) Future Royal Bay ( 新城禦景灣 )

Future Royal Bay is a mixed-use complex project in our “Lifestyle Mall” series. It is situated in Xinbei District adjacent to Xingye Road (興業路). It is closely located near the Changzhou municipal government offices, the Changzhou International Convention and Exhibition Centre and the Changzhou Sports Centre. It is well-connected to transportation facilities and is located in proximity to many public bus lines and BRT stops.

We entered into land use rights contracts with respect to Future Royal Bay in June 2006. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of RMB160 million.

– 121 –

The project occupies an aggregate site area of approximately 55,585 sq.m. and has a total GFA of approximately 141,325 sq.m.

As of December 31, 2013, this project had 124,939 sq.m. of completed GFA, of which 24,188 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 16,406 sq.m.

(20) Changxin Road Project ( 常新路項目 )

Changxin Road Project comprises an industrial complex located in Changxin Road, Changzhou. It occupies a site area of approximately 266,030 sq.m. and a total GFA of approximately 112,500 sq.m. We are holding the relevant land parcels in this project for future development upon obtaining the necessary approvals to re-zone the site for commercial use. Relevant application materials for re-zoning the aforesaid industrial complex have been submitted to the relevant governmental authorities.

We acquired the Changxin Road project in October 2010 by acquiring 100% of the equity interests in Changzhou Jiachi. Changzhou Jiachi had paid the land premium of RMB160.0 million in full in accordance with the terms of the relevant land grant contract. We have obtained the land use rights certificate and are in the process of applying to the relevant government authorities for re-zoning the site for commercial use. As of the date of this offering memorandum, we are negotiating with the relevant government authorities for the terms and conditions for such re-zoning activity. We intend to apply for the relevant licenses, permits and certificates required for the development of this project after obtaining the aforesaid re-zoning approvals.

(21) Jintan Wanjiantang Project ( 金壇萬建塘項目 )

Jintan Wanjiantang Project is a mixed-use complex project in our “Lifestyle Mall” series. It is located in the suburbs of Jintan City (金壇市), bordering Jinwu Expressway (金武線) which provides easy access to and from Changzhou.

We entered into land use rights contracts with respect to Jintan Wanjiantang Project in April 2011. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB15.3 million.

The project occupies an aggregate site area of approximately 31,841 sq.m. and has a total GFA of approximately 43,463 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(22) Plot No. JXB20130501 in Changzhou ( 常州 JXB20130501 地塊 )

Plot No. JXB20130501 in Changzhou is a residential project in our “FirstHomes” series. It is located in the suburbs of Changzhou City bordering Longjiang Elevated Expressway (龍江路高架), Shunyuan Road (順園路), Longcheng Avenue (龍城大道) and West Hehai Road (河海西路).

We entered into land use rights contracts with respect to Plot No. JXB20130501 in Changzhou in December 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB196.0 million.

The project occupies an aggregate site area of approximately 51,966 sq.m. and has a total GFA of approximately 155,898 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Projects in Shanghai ( 上海 )

(23) Park View International Community B ( 上海新城金郡 B)

Park View International Community B is a residential project in our “SweetHomes” series. It is located at the heart of Jiading Future Land Area, one of the five key new towns to be developed by the Shanghai municipality. It borders Ziqi Donglai Central Scenic Park (“紫氣東來”中央景觀公園) to the south and Shanghai F1 International Circuit to the west. It has a number of amenities in its vicinity, including Affiliated Secondary School of Shanghai University of Communications (上海交大附中) and Baoli Theatre (保利大劇院). It is

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well-connected with transportation facilities and major roads, including the Shanghai-Jiading Expressway (滬嘉高速) and the Shanghai-Nanjing Expressway (滬寧高速) that connects it to the city center of Shanghai, Hongqiao International Airport and major cities in both Jiangsu and Zhejiang Provinces. It is also located close to Baiyin (白銀) Station of the Shanghai Metro Line 11.

We entered into land use rights contracts with respect to Park View International Community B in August 2008. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB350.5 million.

The project occupies an aggregate site area of approximately 93,463 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 232,229 sq.m., of which 39,824 sq.m. remained available for sale.

(24) YOHO City ( 悠活城 )

YOHO City is a residential project in our “FirstHomes” series. It is located northwest of Jiading Future Land area, one of the five key new development towns in Shanghai. The project is well-connected to transportation facilities, including Jiading Station of Shanghai Metro Line 11 (地鐵11號線嘉定西站) and the Jiading Long Haul Transportation Hub (嘉定長途客運中心), which allow residents to commute between Shanghai and major cities of the Jiangsu and Zhejiang Provinces via rapid bus lines.

We entered into land use rights contracts with respect to YOHO City in May 2009. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB400.0 million.

The project occupies an aggregate site area of approximately 78,369 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 230,128 sq.m., of which 62,081 sq.m. remained available for sale.

(25) Park View International Community A ( 上海新城金郡 A)

Park View International Community A is a residential project in our “SweetHomes” series. It is adjacent to Park View International Community B and shares similar location characteristics as Park View International Community B.

We entered into land use rights contracts with respect to Park View International Community A in May 2009. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB466.0 million.

The project occupies an aggregate site area of approximately 70,900 sq.m. and has a total GFA of approximately 242,022 sq.m.

As of December 31, 2013, this project had 150,630 sq.m. of completed GFA, of which 18,212 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 26,262 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 91,130 sq.m. as of December 31, 2013.

(26) Exalted Uptown ( 尚上城 )

Exalted Uptown is a residential project in our “FirstHomes” series. It is located in Anting Town of Jiading District, at the heart of the Shanghai’s international automobile industrial base. The Automobile Expo Park (汽車博覽公園) and a golf course are in the vicinity of the project. Conveniently located within walking distance of Shanghai-Nanjing Inter-city High Speed Railway Anting Station (滬寧城際高鐵安亭站), Exalted Uptown is well-connected to major inter-city transportation facilities, major roads such as the Shanghai-Nanjing Expressway (滬寧高速), the Shanghai-Jiading Expressway (滬嘉高速) and the Cao’an Expressway (曹安公路), as well as Anting Automobile City Station of Shanghai Metro Line 11 (軌道交通11號線安亭汽車城站).

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We entered into land use rights contracts with respect to Exalted Uptown in February 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB717.0 million.

The project occupies an aggregate site area of approximately 65,944 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 171,349 sq.m., of which 42,090 sq.m. remained available for sale.

(27) Gorgeous Mansion ( 憶華里 )

Gorgeous Mansion is a residential project in our “DreamHomes” series. It is located on Caoying Road (漕盈路) in Qingpu District, immediately outside the Greater Hongqiao Region (大虹橋板塊). The tourist attractions of Zhujiajiao Old Town (朱家角古鎮) and Dianshan Lake (澱山湖) are in its close vicinity. It is well-connected to transportation facilities, including Caoying Station of Shanghai Metro Line 20 (軌道交通20 號線漕盈路站), which is currently under Construction.

We entered into land use rights contracts with respect to Gorgeous Mansion in April 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB1,201.9 million.

The project occupies an aggregate site area of approximately 137,046 sq.m. and has a total GFA of approximately 319,590 sq.m.

As of December 31, 2013, this project had 162,679 sq.m. of completed GFA, of which 2,013 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 162,048 sq.m.

(28) Petrus Hacienda ( 森蘭碧翠園 )

Petrus Hacienda is a residential project in our “PrestigeHomes” series. It is located in Gaohang Town (高行鎮) in Pudong New Area, adjacent to the Waigaoqiao Tax Free Zone (外高橋保稅區). It is located within a residential area that offers its residents a variety of amenities within its vicinity. Wet lands, sports parks, international schools and medical facilities can be found close to the development. It is well-connected to transportation facilities, including Wuzhou Avenue Station (五洲大道站) of Shanghai Metro Line 6.

We entered into land use rights contracts with respect to Petrus Hacienda in October 2009. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB324.9 million.

The project occupies an aggregate site area of approximately 79,328 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 183,606 sq.m., of which 50,197 sq.m. remained available for sale.

(29) Golden Territory ( 金色領域 )

Golden Territory is a residential project in our “SweetHomes” series. It is located at the heart of Jiading Future Land Area, one of the five key new towns to be developed by the Shanghai municipality, in proximity to Park View International Community A and shares similar location characteristics as Park View International Community A.

This project was developed by Shanghai Wanzhicheng. We entered into a cooperation agreement with Shanghai Vanke Real Estate Co., Ltd. (上海萬科房地產有限公司) (“ Shanghai Vanke ”), pursuant to which we acquired 50% equity interests in Shanghai Wanzhicheng to jointly develop Golden Territory.

As of December 31, 2013, we had paid 50% of the land premium in an aggregate amount of approximately RMB559.6 million, the rest of the amount of the land premium was paid by Shanghai Vanke.

The project occupies an aggregate site area of approximately 90,013 sq.m. and has a total GFA of approximately 227,546 sq.m.

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As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 136,421 sq.m.

(30) Fragrant Legend (Hongde Road Project) ( 香溢瀾庭 ( 洪德路項目 ))

Fragrant Legend is a residential project in our “DreamHomes” series. It is located at the heart of Jiading Future Land, one of the five key new development towns in Shanghai. It borders Ziqi Donglai Central Scenic Park (“紫氣東來”中央景觀公園) to the south and Shanghai F1 International Circuit to the west. It is located across from Affiliated Secondary School of Shanghai University of Communications (上海交大附中), one of the reputable secondary schools in Shanghai. It is well-connected with transportation facilities and major roads, including the Shanghai-Jiading Expressway (滬嘉高速) and the Shanghai-Nanjing Expressway (滬寧高速) that connects the project to the city center of Shanghai, Hongqiao International Airport and major cities in both Jiangsu and Zhejiang Provinces. It is also located in proximity to Baiyin (白銀) Station of the Shanghai Metro Line 11.

We entered into land use rights contracts with respect to Hongde Road Project in October 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB610.0 million.

The project occupies an aggregate site area of approximately 41,895 sq.m. and has a total GFA of approximately 94,807 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 94,807 sq.m.

(31) Park View Ivy ( 上海新城金郡‧常春藤 )

Park View Ivy is a residential project in our “SweetHomes” series. It is located at the heart of Jiading Future Land, one of the five key new development towns in Shanghai. It borders Ziqi Donglai Central Scenic Park (“紫氣東來”中央景觀公園) to the south and Shanghai F1 International Circuit to the west. It is located across from the Affiliated Secondary School of Shanghai University of Communication (上海交大附中), one of the most reputable secondary schools in Shanghai, and Baoli Theatre (保利大劇院). It is well-connected with transportation facilities and major roads, including the Shanghai-Jiading Expressway (滬嘉高速) and the Shanghai Nanjing Expressway (滬寧高速) that connects it to the city center of Shanghai, Hongqiao International Airport and major cities in both Jiangsu and Zhejiang Provinces. It is also located in proximity to Baiyin (白銀) Station of the Shanghai Metro Line 11.

The project occupies an aggregate site area of approximately 35,259 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 71,037 sq.m., of which 27,098 sq.m. remained available for sale.

(32) Yunchuan Road Project ( 蘊川路項目 )

Yunchuan Road Project is a residential project in our “FirstHomes” series. It is located at the west of Yunchuan Road, south of Yuesheng Road in Shanghai Baoshan District. This project is well-connected to transportation facilities and is located in proximity to many public bus lines.

We entered into land use rights contracts with respect to Yunchuan Road Project in November 2012. As of December 31, 2013, we had paid in full the land premium in an aggregate amount of approximately RMB342.5 million.

The project occupies an aggregate site area of approximately 64,911 sq.m. and has a total GFA of approximately 94,324 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 109,328 sq.m.

(33) Rushui Road South Project ( 茹水南路項目 )

Rushui Road South Project is a residential project in our “SweetHomes” series. It is located at the west of Rushui Road South and south of Yecheng Road in Shanghai Jiading District. This project is equipped with

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a wide variety of amenities and is located in proximity to many public bus lines, as well as Shanghai-Nanjing Expressway (滬寧高速) and Shanghai-Jiading Expressway (滬嘉高速).

We entered into land use rights contracts with respect to Rushui Road South Project in December 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB495.1 million.

The project occupies an aggregate site area of approximately 38,366 sq.m. and has a total GFA of approximately 113,146 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 116,212 sq.m.

(34) Jiading Future Land A06-1 Project ( 嘉定新城 A06-1 項目 )

Jiading Future Land A06-1 Project is a residential project in our “DreamHomes” series. It is located in the central district of Jiading Future Land Area, It is located at the heart of Jiading Future Land Area, one of the five key new towns to be developed by the Shanghai municipality. It is also located close to Baiyin (白銀) Station of the Shanghai Metro Line 11, Ziqi Donglai Central Scenic Park (“紫氣東來”中央景觀公園) and Shanghai F1 International Circuit. It has a number of amenities in its vicinity, including Affiliated Secondary School of Shanghai University of Communications (上海交大附中). It is well-connected with transportation facilities and major roads, including the Shanghai-Jiading Expressway (滬嘉高速) and the Shanghai-Nanjing Expressway (滬寧高速) that connects it to the city center of Shanghai, Hongqiao International Airport and major cities in both Jiangsu and Zhejiang Provinces.

We entered into land use rights contracts with respect to Jiading Future Land A06-1 Project in December 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB757.9 million.

The project occupies an aggregate site area of approximately 48,569 sq.m. and has a total GFA of approximately 139,600 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

According to our development plans, the properties held for future development had an expected GFA of approximately 139,600 sq.m.

(35) Jiading Future Land A06-2 Project ( 嘉定新城 A06-2 項目 )

Jiading Future Land A06-1 Project is a residential project in our “DreamHomes” series. It is located in the central district of Jiading Future Land Area, It is located at the heart of Jiading Future Land Area, one of the five key new towns to be developed by the Shanghai municipality. It is also located close to Baiyin (白銀) Station of the Shanghai Metro Line 11, Ziqi Donglai Central Scenic Park (“紫氣東來”中央景觀公園) and Shanghai F1 International Circuit to the west. It has a number of amenities in its vicinity, including Affiliated Secondary School of Shanghai University of Communications (上海交大附中). It is well-connected with transportation facilities and major roads, including the Shanghai-Jiading Expressway (滬嘉高速) and the Shanghai-Nanjing Expressway (滬寧高速) that connects it to the city center of Shanghai, Hongqiao International Airport and major cities in both Jiangsu and Zhejiang Provinces.

We entered into land use rights contracts with respect to Jiading Future Land A06-2 Project in December 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB489.5 million.

The project occupies an aggregate site area of approximately 32,186 sq.m. and has a total GFA of approximately 957,000 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

According to our development plans, the properties held for future development had an expected GFA of approximately 95,700 sq.m.

(36) Plot in Longxiang Road, Jinshan District ( 金山龍翔路地塊 )

Plot in Longxiang Road, Jinshan District is a residential project. It is located in the middle of Jinshan New Town and has a number of amenities in its vicinity, including East China University of Science and Technology (華東理工大學) and Jinshan Hospital of Fudan University (復旦大學附屬金山醫院).

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We entered into land use rights contracts with respect to Plot in Longxiang Road, Jinshan District in September 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB704.0 million.

The project occupies an aggregate site area of approximately 108,393 sq.m. and has a total GFA of approximately 195,107 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(37) Plot of Yongfeng Street, Songjiang ( 松江永豐街道地塊 )

Plot of Yongfeng Street, Songjiang is a residential project in our “DreamHomes” series. It is located in Songjiang District and is close to the Songjiang Central Hospital (松江區中心醫院), Foreign Language High School Affiliated with Shanghai Normal University (上海師範大學附屬外國語中學), Central Plaza (世紀廣場) and Songjiang Mall (松江商城).

We entered into land use rights contracts with respect to Plot of Yongfeng Street, Songjiang in December 2013. The amount of land premium was approximately RMB734.0 million, of which RMB146.8 million had been paid as of December 31, 2013. As of the date of this offering memorandum, we have fully paid the remaining land premium of RMB587.2 million.

The project occupies an aggregate site area of approximately 39,993.3 sq.m. and has a total GFA of approximately 46,489.9 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Projects in Nanjing ( 南京 )

(38) Nanjing Future France ( 南京香溢紫郡 )

Nanjing Future France is a residential project in our “SweetHomes” series. It is located in Gaoxin District, bordering Jinling Institute of Nanjing University (南京大學金陵學院) to the east and Longwangshan Scenic Area (龍王山風景區) to the north. It is well-connected to transportation facilities, including many public bus lines, the Nanjing No. 6 Expressway (寧六公路) and Xinghuo Road Station of Nanjing Metro Line 3 (軌道交通3號線星火路站), which is currently under construction.

We entered into land use rights contracts with respect to Nanjing Future France in November 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB1,325.0 million.

The project occupies an aggregate site area of approximately 239,116 sq.m. and has a total GFA of approximately 680,724 sq.m.

As of December 31, 2013, this project had 104,181 sq.m. of completed GFA, of which 33,003 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 498,267 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 82,276 sq.m. as of December 31, 2013.

(39) Hubei Road Project ( 湖北路項目 )

Hubei Road Project is a mixed-use complex project. It is located in Hunan Road commercial district, one of the commercial centers of Nanjing city, adjacent to Xuanwu Lake Park (玄武湖公園). It borders Lion Bridge Pedestrian Foot Path (獅子橋步行街) to the east and is close to Nanjing Yaohan (南京八佰伴), Suning Global Shopping Centre (蘇寧環球購物中心), Nanjing International Plaza (南京國際廣場) and Westin Hotel (威斯汀大酒店). It is well-connected to transportation facilities, including many public bus lines and Xuanwumen Station of Nanjing Metro Line 1.

We entered into land use rights contracts with respect to Hubei Road Project in June 2007. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB405.0 million.

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The project occupies an aggregate site area of approximately 11,627 sq.m. and has a total GFA of approximately 52,650 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(40) Longwan Garden ( 瓏灣花園 )

Longwan Garden is a residential project in our “DreamHomes” series. It is located at the intersection of Shuanglong Avenue and Chengxin Avenue and is close to Jiulong Lake Park (九龍湖公園) and Nanjing Metro Chengxin Avenue Station (an interchange station of Nanjing Metro Line 3 and Line 5). It has a number of amenities in its vicinity, including the Kindergarten Affiliated with the Nanjing Normal University (南京師範大學附屬幼兒園), Middle School Affiliated with the Nanjing Normal University (南京師範大學附屬中學), Tongren Hospital (銅仁醫院) and Suguo Supermarket (蘇果超市).

We entered into land use rights contracts with respect to Longwan Garden in December 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB1,980.0 million.

The project occupies an aggregate site area of approximately 95,819 sq.m. and has a total GFA of approximately 287,457 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 160,337 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 225,452 sq.m. as of December 31, 2013.

Our Property Development Projects in Kunshan ( 昆山 )

(41) Kunshan Future France ( 昆山香溢紫郡 )

Kunshan Future France is a residential project in our “SweetHomes” series. It is located at the intersection of National Highway 312 (312國道) and South Yangtze Road (長江南路) in Yushan Town. Conveniently located within walking distance of Shanghai-Nanjing Inter-city High Speed Railway Station (滬寧城際高鐵站) and the Beijing-Shanghai Inter-city High Speed Railway Kunshan South Station (京滬高鐵昆山南站), Kunshan Future France is well-connected to major inter-city transportation facilities. It also borders Kunshan Automobile Transportation Hub (昆山市汽車客運中心站) to the north.

We entered into land use rights contracts with respect to Kunshan Future France in January 2011. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB787.5 million.

The project occupies an aggregate site area of approximately 140,085 sq.m. and has a total GFA of approximately 435,536 sq.m.

As of December 31, 2013, this project had 104,441 sq.m. of completed GFA, of which 18,979 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 181,449 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 152,646 sq.m. as of December 31, 2013.

(42) Kunshan Future Land Territory West Project ( 昆山新城域西側項目 )

Kunshan Future Land Territory West Project is a mixed-use complex project in our “Lifestyle Mall” series. It is located at the intersection of National Highway 312 (312國道) and Southern Extension of Bailu Road (柏廬路南延線) in Yushan Town. It is located in proximity to Kunshan Future France and shares similar location characteristics.

We entered into land use rights contracts with respect to Kunshan Future Land Territory West Project in January 2011. The land premium was approximately RMB385.6 million, of which RMB77.1 million had been paid as of December 31, 2013.

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The project occupies an aggregate site area of approximately 65,582 sq.m. and has a total GFA of approximately 210,497 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Projects in Wuxi ( 無錫 )

(43) Up Town ( 尚東雅園 )

Up Town is a residential project in our “SweetHomes” series. It is located in the State Hi-tech Industrial Park, close to Beijing-Hangzhou Grand Canal (京杭大運河). Conveniently located within walking distance of Shanghai-Nanjing Inter-city High Speed Railway Xinqu Station (滬寧城際高鐵新區站), Up Town is wellconnected to major inter-city transportation facilities as well as many public bus lines.

We entered into land use rights contracts with respect to Up Town in July 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB100.0 million.

The project occupies an aggregate site area of approximately 143,514 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 446,558 sq.m.

As of December 31, 2013, this project had 328,874 sq.m. of completed GFA, of which 50,780 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 9,458 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 117,226 sq.m. as of December 31, 2013.

(44) Wuxi Future France (Jincheng East Road Project) ( 無錫香溢紫峻 ( 金城東路項目 ))

Wuxi Future France, which was formerly Jincheng East Road Project, is a residential project in our “SweetHomes” series. It is located in the central business district of Wuxi National Technological Industrial Zone (無錫國家高新技術產業園區), bordering Jincheng East Road to the North and Xixing Road to the west. It is also located close to Xincheng Central Park (新城中央公園) and the Inner Ring Express Road (快速內環線). It is well-connected to transportation facilities and is located in proximity to many public bus lines.

We entered into land use rights contracts with respect to Jincheng East Road Project in September 2010. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB539.0 million.

The project occupies an aggregate site area of approximately 71,566 sq.m. and has a total GFA of approximately 252,000 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 232,004 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 19,996 sq.m.

Our Property Development Projects in Suzhou ( 蘇州 )

(45) Suzhou Future Land Golden County ( 蘇州新城金郡 )

Suzhou Future Land Golden County is a residential project in our “SweetHomes” series. It is located at the intersection of Shaoang Road (邵昂路) and Xingang Road (興昂路) in the Wuzhong District, adjacent to the Wuzhong District administrative center and Shihu Scenic Enclave (石湖風景區). It is well-connected to transportation facilities, including many public bus lines, Raocheng Expressway (繞城高速) and the planned Line 4 of the Suzhou Metro.

We entered into land use rights contracts with respect to Suzhou Future Land Golden County in August 2007. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB920.0 million.

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The project occupies an aggregate site area of approximately 310,384 sq.m. As of December 31, 2013, we had completed the entire project with a total GFA of 584,168 sq.m. of completed GFA, of which 96,963 sq.m. remained available for sale.

(46) Suzhou Fragrant Legend ( 蘇州香溢瀾橋 )

Suzhou Fragrant Legend is a residential project in our “SweetHomes” series. It is located along west of Fengjin Road (楓津路), bordering Dongwu South Road (東吳南路) to the south, next to the government building of the Wuzhong District. It is also close to the Dantaihu Park (澹台湖公園). It is well-connected to transportation facilities and is located in proximity to many public bus lines and the planned Line 2 & 4 of the Suzhou Metro.

We entered into land use rights contracts with respect to Suzhou Fragrant Legend in August 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB720.0 million.

The project occupies an aggregate site area of approximately 74,810 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 256,352 sq.m.

As of December 31, 2013, this project had 64,186 sq.m. of completed GFA, of which 22,352 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 21,098 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 176,068 sq.m. as of December 31, 2013.

(47) Shihu Mansion (Sujie Project) ( 石湖公館 ( 蘇街項目 ))

Shihu Mansion, which was formerly Sujie Project, is a residential project in our “DreamHomes” series. It is located along south of Su Street (蘇街) and east of Yuexi Street (越溪街), adjacent to Wenzheng College of Soochow University (蘇州大學文正學院). It is located in proximity to Shihu Scenic Area (石湖風景區). It is well-connected to transportation facilities and is located in proximity to many public bus lines and the planned Line 4 of the Suzhou Metro.

We entered into land use rights contracts with respect to Sujie Project in July 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB765.0 million.

The project occupies an aggregate site area of approximately 82,596 sq.m. and has a total GFA of approximately 263,538 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 141,325 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 122,213 sq.m.

(48) Future Mangrove Bay ( 紅樹灣 )

Future Mangrove Bay is a residential project in our “FirstHomes” series. It is located close to the commercial center of Wujiang District and Suzou Metro Line 4.

We entered into land use rights contracts with respect Future Mangrove Bay in December 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB1,003.0 million.

The project occupies an aggregate site area of approximately 122,464 sq.m. and has a total GFA of approximately 325,946 sq.m.

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As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 263,596 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 126,640 sq.m.

(49) Wujiang Injoy Plaza ( 吳江吾悅廣場 )

Wujiang Injoy Plaza is a mixed-use complex project in our “City Plaza” series. It is located in the central of Wujiang Tai Lake New Town (吳江區太湖新城). This project is a commerce exploiture above a station of Suzhou Metro Line 4.

We entered into land use rights contracts with respect to Wujiang Injoy Plaza in May 2013. The amount of land premium was approximately RMB527.8 million, of which RMB349.9 million had been paid as of December 31, 2013. As of the date of this offering memorandum, we have fully paid the remaining land premium of RMB177.9 million.

The project occupies an aggregate site area of approximately 154,313 sq.m. and has a total GFA of approximately 527,183 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 183,303 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 527,845 as of December 31, 2013.

(50) Zhangjiagang Injoy Plaza ( 張家港吾悅廣場 )

Zhangjiagang Injoy Plaza is a mixed-use complex project in our “City Plaza” series. It is divided into two parcels, Zhangjiagang 2012-B47-A Land Parcel (張家港2012-B47-A地塊) and Zhangjiagang 2012-B47-B Land Parcel (張家港2012-B47-B地塊). It is located in the heart of south Zhangjiagang City and is close to the Jiyang Lake.

We entered into land use rights contracts with respect to Zhangjiagang Injoy Plaza in October 2013. The amount of land premium was approximately RMB689.8 million, of which RMB345.1 million had been paid as of December 31, 2013.

Zhangjiagang 2012-B47-A Land Parcel occupies an aggregate site area of approximately 65,678 sq.m. and has a total GFA of approximately 262,712 sq.m. Zhangjiagang 2012-B47-B Land Parcel occupies an aggregate site area of approximately 65,716 sq.m. and has a total GFA of approximately 262,864 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Project in Changsha ( 長沙 )

(51) Future Land International Metropolis ( 新城國際花都 )

Future Land International Metropolis is a mixed-use complex project in our “City Plaza” series. It is situated in Wangcheng District (望城區), along the east side of Leifeng Road (雷鋒大道東側) and the south side of Yinxing Road (銀星路南側). It borders Wangcheng Economic Development Zone (望城經濟開發區) to the north, Gushan Scenic Enclave (谷山風景區) to the south, and Hunan Baiguoyuan Village (湖南百果園) to the west. It is well-connected with transportation facilities, including the inter-city transportation hub of Changsha.

We entered into land use rights contracts with respect to Future Land International Metropolis in April 2011. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB749.5 million.

The project occupies an aggregate site area of approximately 338,840 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 1,454,332 sq.m.

As of December 31, 2013, this project had 510,934 sq.m. of completed GFA, of which 92,901 sq.m. remained available for sale.

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As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 201,700 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 785,198 sq.m. as of December 31, 2013.

Our Property Development Project in Wuhan ( 武漢 )

(52) In Spring Live ( 春天里 )

In Spring Live is a residential project in our “FirstHomes” series. It is situated in Wuhan Hanyang District, along the west side of Jiangdi Middle Road (武漢市漢陽區江堤中路), and the south side of Jiangxinyuan Road (江欣苑路). It is located near the Moshui Lake (墨水湖), and the Wuhan Zoo (武漢動物園). It is well connected with transportation facilities.

We entered into land use rights contracts with respect to In Spring Live in August 2012. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB359.0 million.

The project occupies an aggregate site area of approximately 61,689 sq.m. and has a total GFA (including saleable and non-saleable GFA) of approximately 184,303 sq.m.

As of December 31, 2013, this project had approximately 177,420 sq.m. of completed GFA, of which approximately 60,508 sq.m. remained available for sale.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 38,883 sq.m.

Our Property Development Project in Zhenjiang ( 鎮江 )

(53) Dantu Project ( 丹徒項目 )

Dantu Project is a mixed-use complex project in our “City Plaza” series. It is situated in Zhenjiang Dantu District, and is equipped with a wide variety of amenities such as a library, governmental offices and a hospital. It is close to the South Zhenjiang Railway Station and is well-connected with transportation facilities and major roads.

We entered into land use rights contracts with respect to Dantu Project in May 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB270.0 million.

The project occupies an aggregate site area of approximately 90,143 sq.m. and has a total GFA of approximately 210,800 sq.m.

As of December 31, 2013, the properties under development had an expected aggregate GFA of approximately 16,201 sq.m.

According to our development plans, the properties held for future development had an expected GFA of approximately 241,099 sq.m. as of December 31, 2013.

(54) Zhenjiang Danyang Injoy Plaza ( 鎮江丹陽吾悅廣場 )

Zhenjiang Danyang Injoy Plaza is a mixed-use complex project in our “City Plaza” series. It is divided into three parcels, Plot No. G1334 in Danyang (丹陽G1334), Plot No. G1335 in Danyang (丹陽G1335) and Plot No. G1334 in Danyang (丹陽G1336). It is located in Danyang Development Zone (丹陽開發區) and is close to the offices of the municipal government.

We entered into land use rights contracts with respect to Zhenjiang Danyang Injoy Plaza in October 2013. The amount of land premium was approximately RMB442.2 million, of which RMB221.1 million had been paid as of December 31, 2013.

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Plot No. G1334 in Danyang occupies an aggregate site area of approximately 43,609 sq.m. and has a total GFA of approximately 152,632 sq.m. Plot No. G1335 in Danyang occupies an aggregate site area of approximately 66,630 sq.m. and has a total GFA of approximately 233,205 sq.m. Plot No. G1336 in Danyang occupies an aggregate site area of approximately 37,050 sq.m. and has a total GFA of approximately 129,675 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Project in Hangzhou ( 杭州 )

(55) Shunda Road Project in Yuhang District, Hangzhou ( 餘杭順達路項目 )

Shunda Road Project in Yuhang District is a residential project in our “SweetHomes” series. It is located at the intersection of Xingguang Street and Yuhe Road in Yuhang District, Hangzhou. It has a number of amenities in its vicinity, including Maco City (萬寶城) commercial complex, Lianhua Supermarket (聯華超市), New Star Kindergarten (新星幼兒園), Yuhang No. 1 People’s Hospital (餘杭第一人民醫院) and Maternal & Child Health Hospital (婦幼保健院). It is close to a station of Hangzhou Metro Line 1.

We entered into land use rights contracts with respect to Shunda Road Project in Yuhang District, Hangzhou in August 2013. As of December 31, 2013, we had fully paid the land premium in an aggregate amount of approximately RMB313.7 million.

The project occupies an aggregate site area of approximately 54,033 sq.m. and has a total GFA of approximately 124,276 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(56) Plot No. R21-04 of Hangzhou Shenhua Unit ( 杭州申花單元 R21-04)

Plot No. R21-04 of Hangzhou Shenhua Unit is a residential project in our “PrestigeHomes” series. It is located at Gongshu District, Hangzhou and is close to Hangzhou International Exhibition Centre (杭州國際會展中心). It has a number of amenities in its vicinity, including a hospital, several kindergartens and a middle school.

We entered into land use rights contracts with respect to Plot No. R21-04 of Hangzhou Shenhua Unit in September 2013. The amount of land premium was approximately RMB321.0 million, of which RMB160.5 million had been paid as of December 31, 2013.

The project occupies an aggregate site area of approximately 11,018 sq.m. and has a total GFA of approximately 22,036 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

(57) Plot of Future Sci-Tech City in Yuhang District ( 餘杭未來科技城 )

Plot of Future Sci-Tech City in Yuhang District is a residential project in our “DreamHomes” series. It is located at the intersection of Gaojiao Road and Dianzi Road in Yuhang District, Hangzhou, which is the core area of the Hangzhou Future Sci-Tech City (杭州未來科技城). It has a number of amenities in its vicinity, including a hospital, an elementary school, Hangzhou Normal University (杭州師範大學) and the Medical Centre of Zhejiang University.

We entered into land use rights contracts with respect to Plot of Future Sci-Tech City in Yuhang District in October 2013. The amount of land premium was approximately RMB450.0 million, of which RMB225.0 million had been paid as of December 31, 2013.

The project occupies an aggregate site area of approximately 32,226 sq.m. and has a total GFA of approximately 51,562 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Our Property Development Project in Nantong ( 南通 )

(58) Nantong Plot No. CR13043 ( 南通 CR13043 地塊 )

Nantong Plot No. CR13043 is a mixed-use complex project in our “City Plaza” series. It is located in the New High-tech City in the north of Nantong and surrounded by Puxian Chan Temple, No. 2 People’s Hospital, Nantong No. 2 Middle School and a commodity market.

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We entered into land use rights contracts with respect to Nantong Plot No. CR13043 in December 2013. The amount of land premium was approximately RMB701.5 million, of which RMB105.3 million had been paid as of December 31, 2013.

Nantong Plot No. CR13043 occupies an aggregate site area of approximately 185,576 sq.m. and has a total GFA of approximately 556,728 sq.m. As of December 31, 2013, we had not commenced the construction of this project.

Trust Financing Arrangements

In addition to banking facilities, a number of PRC property developers obtained alternative financing through trust financing arrangements in recent years. Certain of our PRC subsidiaries entered into trust financing arrangements subsequent to December 31, 2013. See “Business −Recent Developments −Trust Financing Arrangements and Bank Borrowings after December 31, 2013.” Trust financing arrangements are funding arrangements provided by trust funds, which are domestic funds set up and managed by trust financing companies registered with the CBRC that act as trustees of these funds. Trust financing is an authorized form of financing transaction under PRC laws. In recent years, trust financing arrangements have become a common source of funds for property developers in the PRC, which can be structured in various forms, including equity transfers, capital injections, equity acquisitions, shareholder loans, or secured loans granted by trust financing companies acting as trustees of the respective trust funds. Trust financing companies may enter into secured loan arrangements with the borrowing company consisting of a combination of agreements involving equity pledges or security interests, guarantees, capital injections, equity transfers, repurchases and loan assignments. As with many other property developers in the PRC, we have entered into trust financing arrangements in the ordinary course of business to finance our operations. We broadly categorize our trust financing arrangements into two types:

Type (i) arrangements: trust loans in which the equity interests in, or the land use rights held by, the borrowing company are pledged to the trust financing company (as trustee of the respective trust fund) as security for loans.

Type (ii) arrangements: trust loans in which equity interests in the borrowing company are acquired by the trust financing company (as trustee of the respective trust fund) through capital injection and/or equity transfer, with an option given to us, or an undertaking given by us, to repurchase the respective equity interests at the expiry of the term of the financing arrangement.

Key Regulations Applicable to our Trust Financing Arrangements

From time to time, the CBRC promulgates circulars and notices to regulate the activities of trust financing companies. Key restrictions on the provision of trust loans for property development projects include the following:

Trust financing companies may not provide trust loans to property projects that have not obtained the requisite land use rights certificates, construction land planning permits, construction works planning permits and construction work commencement permits;
Trust financing companies may only provide trust loans to property projects of which no less than 30% of the total investment will be funded by the developer’s own capital (except for affordable housing and commodity apartments, of which 20% of the total investment shall be funded by the developer’s own capital); and
Trust financing companies are prohibited from providing trust loans to property developers for payments of land premium or working capital purposes.

Please refer to the sections headed “Industry Overview – Regulatory Milestones of the PRC Property Industry” and “Regulation – Trust Loans”.

Key Terms of the Type (i) and Type (ii) Arrangements

Since 2009, we have entered into various type (i) arrangements and type (ii) arrangements. The term of our trust financing agreements ranges from 12 months to 30 months. See the section headed “Description of Material Indebtedness and Other Obligations – Trust Financing Arrangements” for the key terms of the trust

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financing arrangements. While we have not defaulted on our repayments or any other material obligations under the trust financing arrangements, if we fail to satisfy our repayment obligations, we may lose ownership of the relevant project companies. Please refer to the section headed “Risk Factors – Risks Relating to Our Business – We may be adversely affected if we fail to redeem the equity interests in any of our project companies we have pledged to trust financing companies to finance our property development projects” for further details.

In each of our type (ii) arrangements, the terms thereof require us to either transfer part of the equity interests held by us in the relevant project companies to the trust financing companies or to allow the trust financing companies to subscribe for equity interests in the relevant project companies. The equity interest to be transferred or subscribed for is negotiated on a case by case basis taking into account the loan amount. During the term of type (ii) arrangements, we retain management control over the day-to-day operations of the relevant project companies and continue to manage the property projects undertaken by our project companies and are entitled to market and sell the properties developed by our project companies. The trust financing companies in type (ii) arrangements may be given the power to appoint directors to the board of our project companies to safeguard their interests as creditors. Certain trust financing companies may also be granted the right to veto or otherwise block actions by our project companies that may materially impair the interests of the trust financing companies. These rights are consistent with creditor protections customarily provided to secured creditors. We do not have any type (ii) arrangements as of the date of this offering memorandum.

All of the trust financing companies with whom we have entered into trust financing arrangements are independent third parties.

Accounting Treatment for Type (ii) Arrangements and Project Companies Subject to Type (ii) Arrangements

For type (ii) arrangements, while the equity interests in our project companies were acquired by or transferred to the trust financing companies, we believe we retained ownership and control of the relevant project companies and rights incidental thereto.

Both our PRC legal advisers and we are of the view that our trust financing arrangements are secured borrowing transactions in substance, given that the equity interests in the project companies were required to be returned to us upon our repayment of the agreed amounts. In accordance with generally accepted accounting principles under HKFRSs, the proceeds from the trust financing arrangements were recorded as borrowings in our financial statements.

Although we did not hold the majority equity interest in most of the project companies that were subject to type (ii) arrangements in the past, we retained control over all such project companies. As such, they have been accounted for as our subsidiaries in accordance with generally accepted accounting principles under HKFRSs, which defines “control” as the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

Each of the project companies that were subject to type (ii) arrangements adopted its financial and operating policies including detailed development plans, property development specifications, budgets and cash flow forecasts independent of the trust financing companies, and retained the right to determine the selling price of its properties as well as its distribution and reinvestment policies. All decisions relating to the ordinary course of business and day-to-day management of the project companies were made by the management team of the project companies headed by the respective general managers, each of whom was nominated by us pursuant to the relevant trust financing agreements.

The trust funds and trust financing companies (as trustees of the respective trust funds) were entitled to a fixed return during the term of the type (ii) arrangements, but did not enjoy any dividends from, or other residual interests in, the project companies. The trust financing companies did not assume any risks associated with the project companies’ operations. We, on the other hand, were entitled to the residual interests of the project companies that were subject to type (ii) arrangements and were exposed to downside risks related to the operations of such project companies.

As a result, we believe we retained ownership and control of the relevant project companies that were subject to type (ii) arrangements. For the reasons set forth above, we treated the project companies subject to type (ii) arrangements as our subsidiaries during the relevant accounting periods.

Property Development Management

“Rapid asset turnover” Model and Standardized Development Process

We adopted a “rapid asset turnover” model in managing our property development projects, with the objective of shortening the period between site acquisition and pre-sale of our properties. As an integral part

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of our rapid asset turnover model, we have implemented a standardized development process, through which we develop our property using standardized procedures, components and units.

Our standardized property development process

The following diagram summarizes our standardized property development process:

OUR STANDARDIZED PROPERTY DEVELOPMENT PROCESS

Site Selection and
Land Acquisition
•
Collect and analyze empirical data on the population
composition, macro-economic environment, competitive
landscape, regulatory restrictions and policies, and user
preferences, etc., of existing and target markets
•
Carry out in-depth studies to analyze the demand,
supply and potential of the local market
•
Develop standardized investment model and site
selection procedures to identify and assess
opportunities for property development
Architectural Design
and Product
Development
•
Centralize design and research efforts at our
architecture research institute to:
–
develop standardized property series to delineate our
positioning for each of our target customer groups
–
develop standardized floor plans for different
property series and product types
–
improve our property’s design and innovation
–
develop architectural themes and concepts to meet
the needs and preferences of our target customer
groups
–
develop standardized components for our
property projects
Project
Construction and
Management
For each of our property series, we design, procure and
incorporate standardized property structures and components,
such as:
•
foundation work and structural components
•
electrical, plumbing and drainage components
•
artificial intelligence control and appliance units
•
landscape
Quality Control
and Delivery
To ensure efficient development and consistent delivery of
high quality properties to customers, we established
standardized procedures for:
•
procurement and selection of design firms and
contractors
•
inspection and testing of building materials and
equipments
•
inspection of completed units before delivery
We established quality control standards and foster close
cooperations among our design and research, project
management, sales and property management teams throughout
the property development process.
Property
Management
and Customer
Servicing
We formulated the following standardized policies and
protocols for our customer service officers
•
day-to-day property management protocols
•
retail store management protocols
•
clubhouse services protocols
•
public amenities management protocols
•
communal area cleaning, maintenance and security service
protocols

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The use of standardized designs and modular components helps us efficiently develop a wide range of products (including high-rise apartments, mid-rise apartments, townhouses and luxury stand-alone houses) to meet the needs and preferences of our target customers. We have developed the following standardized designs and modular components for our properties:

Product Designs and Components

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----- Start of picture text -----

Modern Neo-Classic Italian French Neo-French
Standardized high-rise Townhouse Stand-alone house Mid-rise apartment
components components components components
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Our research and implementation of a standardized property development process has enhanced our execution capability as we are better able to closely monitor our property development processes and rapidly replicate our property projects.

Property Development Process

The following diagram outlines the key work flows of our property development process.

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----- Start of picture text -----

on cities andprojects researchMarket acquisition Land planning anddesign Project Pre-constructionfinancing and Constructionand qualitycontrol marketing Sales and delivery, leasingand after-salesCompletion,services management Property
----- End of picture text -----

Market research

The sales and marketing department at our headquarters is responsible for market research, identifying target cities and potential projects. We assess and evaluate the potential of target cities, and potential development sites and position the products to be developed accordingly.

The primary criteria in our project site evaluation include the following:

location, size, dimensions;
local population, purchasing power, target customer demand and expected growth of the area/district in which the land is located;
transportation access and infrastructure support;
estimated development costs and time, including demolition and resettlement costs and schedule;
expected financial return;
development prospects, taking into account social, economic and environmental effects;
local competitive environment;
applicable zoning regulations and preferential government policies;
government development plans for the relevant site and the neighboring area; and
product positioning.

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If we decide to proceed with a particular development, we will prepare an in-depth feasibility study which includes project design, product positioning, financial projection, and return analysis. The feasibility study report will be submitted to our Investment Committee, consisting of senior management members, which will consider and assess the costs, return, capital requirements and resources requirements of the proposed project against the availability of our resources and its compatibility with our strategic direction.

We regularly monitor announcements made by respective local governments in relation to public tenders, auctions or listing-for-sale of land parcels, and maintain good relationships with real estate agents and brokers to obtain information on suitable projects in the secondary market.

Land acquisition

There are two common ways by which we may acquire land for property development in the PRC: (i) bidding in public tenders, auctions or listings-for-sale for land use rights in accordance with the Provisions on Bidding, Auction and Sale of Land Use Rights (招標拍賣掛牌出讓國有土地使用權規定), promulgated on May 9, 2002 and effective since July 1, 2002; or (ii) acquire land use rights in the secondary market through the purchase of projects which have not been completed or acquire project companies directly from other developers.

In recent years, we have obtained a substantial majority of our land use rights through listing-for-sale in accordance with the Provisions on Bidding, Auction and Sale of Land Use Rights. The Provisions on Bidding, Auction and Sale of Land Use Rights require all land planned for commercial development (such as retail, residential, and commercial property) to be transferred in one of the following ways: public tenders, auctions or listings-for-sale on the land exchanges. In the case of public tender, the relevant authorities will assess either solely on tender prices or, alternatively, by reference to a matrix of parameters, including tender prices, credit record of the bidders and quality of the development proposals, in determining to whom to grant such rights. On the other hand, where land use rights are granted through auction or listing-for-sale, the highest bidder normally wins.

We have, in the past, voluntarily returned land use rights granted to us through listing-for-sale to ensure we have sufficient working capital. For example, we entered into a rescission agreement with the Jiangning office of the Nanjing Municipal Bureau of State Land and Resources (“ Jiangning Land Bureau ”) in 2008 to rescind a land grant contract. Pursuant to the rescission contract, we returned to the Jiangning Land Bureau the land use rights of certain land parcels (the “ Jiangning Land Parcels ”) located in Jiangning with an aggregate GFA of 133,827 sq.m.

The land use rights of the Jiangning Land Parcels were granted to us as a result of its successful bid at the public tender held by the Jiangning local government in December 2007. We paid a total of RMB129.8 million in 2007 as deposit for the Jiangning Land Parcels, of which RMB94.4 million has been returned to us.

Project planning and design

We have strong in-house design capabilities and maintain a dedicated in-house design team who is responsible for the overall planning and design of our projects.

Once the conceptual design of a property development project is established, we contract out the detailed project design work to reputable architectural, interior and landscape design firms, which we select through a tender process. Various of our departments work closely with these selected architectural and interior design firms to transform the conceptual design into a detailed development proposal (the “ Project Design Proposal ”) for approval by the relevant PRC government authorities.

Pre-construction

Before construction is commenced on a project, we must obtain the development rights to the relevant parcel(s) of land and the necessary permits and certificates, including a land use rights certificate, construction land planning permit, construction work planning permit and construction work commencement permit.

In recent years, we have not experienced significant delays in obtaining the foregoing certificates and permits.

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Compliance with idle land related regulations

Under PRC laws, we may be subject to administrative actions or penalties if we fail to develop a property project according to the terms of the land grant contract. To ensure compliance with these idle land related regulations, we have adopted internal control procedures pursuant to which our project companies are required to closely monitor the progress of development projects, including obtaining the permits and certificates for each project.

Each of our project companies must report to our Board if we fail to complete any Project Design Proposal or obtain any of the necessary permits and certificates for a project at least three months before the expected commencement of construction specified in the project’s land grant contract. Our Board would then consider deferring the construction commencement date of the project and approving a deferred construction schedule as appropriate. After obtaining approval from the Board, the project company would then apply to the relevant local governmental authority to delay construction and execute a supplemental land grant contracts to amend the land commencement and completion dates as necessary.

If the failure to obtain any necessary permits and certificates of a project is attributed to the local government’s failure to complete the demolition of existing buildings, resettlement of existing residents or construction of basic infrastructure as required under the land grant contracts, such incidents are expected to also be reported to the Board for assessment. After obtaining approval from the Board, our strategic investments department and our legal and compliance department are expected to jointly negotiate with the relevant governmental authorities for remedial actions, including but not limited to amending or rescinding the land grant contracts (as appropriate) or entering into new land grant contracts for the acquisition of other equivalent land parcels.

We have not received any notices from any PRC authorities identifying any idle land held by us, nor have we been imposed any idle land fees.

Project financing

We financed our projects primarily through cash flows from operating activities, including proceeds from pre-sales and sales of our properties, bank loans and trust financing arrangements.

We use the pre-sale and sale proceeds of our properties to fund the remaining construction of the same project and to settle bank loans. According to PRC law, we may pre-sell properties under construction after certain criteria are met and proceeds from pre-sales must be used for the construction of properties in the same project. Our policy is to finance our property developments with internal resources to the extent practicable so as to reduce the level of external funding required.

To the extent necessary and subject to the guidelines issued by CBRC, we finance our projects partially through borrowings from banks and trust financing arrangements. The terms of our bank borrowings generally restrict the application of the borrowing proceeds to specific projects or project phases. As of December 31, 2013, our outstanding current and non-current borrowings from banks amounted to RMB11,222.5 million. Our bank loans are primarily provided by major commercial banks in the PRC. As of December 31, 2013, our Group had been given a rating of “AAA-” by Agricultural Bank of China, a rating of AA by China Construction Bank and the ratings of “Key Client” (重點客戶) and “Excellent Real Estate Development Client” (房地產開發優質客戶) by the headquarters of the Bank of China, all of which are our principal bankers.

Historically, we also financed some of our projects with trust financing arrangements. As of December 31, 2013, our total current and non-current borrowings from trust financing arrangements was nil. Please refer to the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further details of our channels of financing, indebtedness and borrowings. Our ability to finance our projects also depends on the economic conditions and regulatory measures introduced by the central and local governments. In particular, any decisions to raise the reserve ratio by the PBOC will limit the amount available to commercial banks for lending and our ability to obtain financing from commercial banks.

We have not defaulted on any material provisions (including any cross-default provisions) of any of our bank loans or trust financing arrangements.

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Construction and our contractors

Tendering process

We outsource the construction work for our property developments including, among other things, foundation digging, general construction, equipment installation, interior decoration and engineering work to qualified independent contractors, which are selected through a tender process in accordance with relevant laws and regulations. The tender process is managed by our tender committee, which comprise our construction and quality management department, our supply and procurement department and our finance and audit department. As part of the tender process, our tender committee conducts the following due diligence:

retrieves information from our contract management system and raise queries internally based on our prior experience with a particular bidder;
conducts interviews with bidders and request confirmations and undertakings with respect to their cash flows, experience and credentials; and
conducts independent research and investigation to verify the credentials and track record of the bidders.

Our tender committee screens bidders that do not meet our requirements. A winning bidder will be selected based on a pre-determined formula that takes into account both the quality of workmanship and price quoted by the bidder. The selected bidder will be required to enter into a construction contract with us. Based on our records, our PRC legal advisers are of the opinion that we are not in violation with any applicable PRC tender laws and regulations.

Major contractors and design firms

We have access to a wide range of construction contractors and engineering/architectural design firms, and have longstanding relationship with more than 70 construction contractors and 20 design firms. Three of such construction contractors were among our top five materials suppliers and contractors in recent years. All of our major contractors or design firms are sizable and properly qualified in respect of the construction and design work contracted to them. Some of such contractors have worked with us for more than a 10 years.

Key terms of agreements

Our contractors must perform their work in accordance with the quality standards and construction schedule set forth in their construction contracts. Under our standard construction contract, contractors are required to pay fines for delays and bear the costs of rectifying any construction defects. We pay contractors in stages in accordance with the terms and conditions as stipulated in the contractor’s construction contract. The stage payments varies from case to case. Upon completion of the project, the contractors will have received approximately 75% to 80% of the total payment. At closing and settlement, we will settle 90% to 95% of the total payment, and retain the remaining 5% to 10% as retention money for a period of 6 to 12 months.

During each of the years ended December 31, 2011, 2012 and 2013 we paid our contractors approximately RMB4,699.0 million, RMB6,938.9 million and RMB9,346.2 million, respectively.

Procurement

Our supply and procurement department coordinates the procurement of building materials and is in charge of price negotiations. Our supply and procurement department purchases major construction materials used in our projects, including standardized components of our properties in bulk. All our construction materials are held and used in connection with the construction of our projects. For major construction materials, we select suppliers through a tender process. In addition, we maintain strict quality control procedures for selecting, inspecting and testing materials. Our project management teams inspect all equipment and materials to ensure compliance with the contractual specifications before accepting the materials on site and approving payment. We reject and return to the suppliers any substandard materials or materials that do not comply with our specifications.

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Project management

We have a “rapid asset turnover” model for developing property projects. We aim at commencing pre-sale of our properties within a relatively short period following site acquisition in order to reduce our development cycle, maximize investment returns, improve cash flows and mitigate the liquidity risks. To implement this strategy, the project management team of each of our project companies, comprising both project managers and in-house qualified engineers, conducts daily on-site supervision of our projects to monitor the progress of construction and quality of construction workmanship.

Quality control and construction supervision

We emphasize quality control to ensure that our properties comply with relevant regulations and are of high quality. Our quality control policies can be categorized into the following aspects:

selection of design firms and contractors;
selection, inspection and testing of building materials and equipment;
establishment of quality control standards; and
on-site inspection of construction processes by our local project management team and our construction and quality management team.

We have implemented standardized technical guidelines to ensure the construction of all our projects complies with relevant laws, regulations, and standards promulgated by the relevant PRC governmental authorities and other industry associations. These guidelines form part of the construction contracts we enter into with the construction companies and form a comprehensive reference for our project management and construction and quality management teams in monitoring the construction of our projects.

We closely monitor the entire construction process. In addition to monitoring by our local project management team, our construction and quality management team, comprising qualified engineers and qualified construction technicians, conducts regular inspections of all our construction sites. We also engage independent quality supervisory companies to conduct on-site quality and safety control checks on all workmanship before accepting the completion of major construction phases.

Our sales and property management department, together with the engineers from our construction and quality management team, inspect every unit of our completed property developments to ensure they are in satisfactory condition prior to delivery of such properties to our customers.

Our strict quality control measures are designed to ensure our contractors comply with the relevant rules and regulations including environmental, labor, social and safety regulations. In recent years, we have not been involved in any dispute with our contractors that have had a material and adverse effect on our business nor have there been any serious personal injuries or death involving our contractors.

Contract management system

We established a contract management system to record, among other things, the payment schedule of each construction or procurement contract we entered into and feedback given by our construction and quality management team or any of our project companies in respect of each of the construction contractors and suppliers we engaged. The contract management system helps us manage our payments and cash flows and evaluate suppliers and service providers for future projects.

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Sales and marketing

Marketing

We have a dedicated in-house sales and marketing department responsible for the advertising and sales of our products. We also retain external agents including advertising companies and real estate sales agencies to help implement our sales and marketing plans and strategies. Our sales and marketing department is involved throughout the property development process and the positioning and pricing of our property developments.

Prior to land acquisition and construction of our projects : our sales and marketing department works closely with our strategic development department to collect relevant market data and conduct the feasibility study of each proposed land acquisition. It also participates in developing the optimal positioning and the conceptual design of all of our projects post land acquisition. This helps ensure that the designs of our projects are in line with the preferences of our target customer bases.

During the construction process : our sales and marketing department regularly conducts on-site inspections to ensure the landscaping, floor plans and interior decoration accurately reflect the sales and marketing materials we presented to customers and potential customers.

Prior to launching property pre-sale : our sales and marketing department formulates strategies and plans for marketing our properties, prepares promotional materials, conducts promotional campaigns, recommends unit prices and pricing related policies for our projects and coordinates and monitors our relationship with the media. In addition to our sales and marketing department’s recommendation, the selling prices of all of our projects are determined, approved and controlled in accordance with established internal control procedures. For further information, please refer to the paragraph headed “– Marketing expenses and pricing control” in this section.

Throughout and subsequent to the pre-sale period : our sales and marketing department provides comprehensive assistance to our customers and collects feedback from customers and potential customers to modify our marketing plans as appropriate.

Promotional initiatives : our sales and marketing department, together with local project companies and sales team, conducts detailed analyzes of market conditions to keep abreast of market developments and changes in macro and social economic conditions. We monitor the marketing and pricing campaigns launched by our competitors, the changes in transaction volumes and contracted ASP, and introduce appropriate sales promotional initiatives to maintain the competitiveness of our projects.

We have in limited circumstances pre-sold less desirable units in particular project phase below its development costs. Impairment testing is conducted at each financial reporting date to determine whether the carrying value of each project or project phase is below the recoverable amount.

Marketing expenses and pricing control

We have formulated comprehensive and centralized marketing expenses and pricing control policies to strategically determine, flexibly adjust and strictly control marketing expenses and selling prices for all of our projects.

Prior to the commencement of development, our strategic investments department determines and approves the marketing budget for each of our projects and the target ASP for each property type under a project. Such budgets and target ASP are determined based on the recommendation by our sales and marketing department and our finance department, which takes into account a wide range of factors, including but not limited to prevailing market conditions and estimated development costs.

In light of the volatility in the PRC property market, our project companies closely study the changing market conditions and the promotional campaigns launched by our competitors during the property development and pre-sale stages of our projects. Where necessary, a project company may request additional promotional initiatives to be launched or the selling prices of selected units of a project or project phase be reduced or discounted for promotional purposes. Similarly, a project company may also request to revise selling prices upwards in response to thriving market conditions or positive market reception of a particular project. Any unbudgeted marketing expenses and any deviation of the target ASP of our properties must be approved by a

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committee that comprises senior management members from the relevant regional management team, the sales and marketing department, the finance department and the strategic investment department. Approval for higher budgets or price deviations will only be granted if the committee is satisfied that the relevant initiative is suitable and necessary in view of prevailing market conditions and does not materially affect the overall profitability of the project or the project phase or the financial condition of the our operations as a whole.

Pre-sales

We generally commence pre-sales of our properties prior to completion of construction. We normally launch pre-sales after a fully-furnished replica of each major floor plan in a development project is completed and a majority of the landscaping and ancillary facilities are completed. We generally use pre-sale proceeds to finance the remaining construction of the project.

Various PRC laws and regulations governing pre-sale of properties impose conditions to be fulfilled before the pre-sale of a particular property can commence. These conditions include obtaining the relevant land use rights certificate, construction land planning permit, construction work planning permit, construction work commencement permit and commodity housing pre-sale permit. In the past, we have not experienced any significant delays in obtaining the foregoing certificates and permits. Property developers are also required to use standard pre-sale contracts prescribed by the local authorities.

Completion, delivery, leasing and after-sales services

Customers payment arrangements

Our customers may purchase our properties with cash or by mortgage financing. Customer who choose cash payments must fully settle the purchase price shortly after the execution of sales contract. Customers who choose to use mortgage financing must pay a down payment upon signing the sales contract. The remainder of the purchase price will normally be paid by the mortgagee bank within two to three months, depending on approval process of the relevant mortgagee bank.

In line with market practice, we have arrangements with various banks to provide mortgage financing to our customers. We do not conduct independent credit checks on the purchasers but rely on the credit checks conducted by the relevant banks. As with other property developers in the PRC, we are usually required by the banks to guarantee the obligations to repay the mortgage loans on the property. The guarantee periods normally last until the release or satisfaction of the mortgage loan after the relevant property ownership certificate (房屋所有權證) is delivered. If a purchaser defaults under a mortgage loan, we are obligated to repay all debt owed by the purchaser to the mortgagee bank under the loan. The mortgagee bank will assign their rights under the loan and the mortgage to us and, after registration of change of mortgagee, we will have full recourse to the property. We have suffered immaterial losses as a result of defaults by purchasers in the past. When purchasers default on mortgage payments, our general policy is to keep the down payment unless we manage to resell the property at a price sufficient to cover the original sales price and our enforcement costs.

Delivery of properties for sale

We aim to deliver properties to our customers within the time frame prescribed in the sale and purchase contracts (including the pre-sale contracts). Under PRC law, we are required to obtain a “Record of Acceptance Examination Upon Project Completion” (竣工驗收備案證明) before delivering properties to our customers. We have not experienced any significant delays in the completion of our projects or delivery of relevant title documents after sale.

We also aim to deliver quality properties and satisfactory purchasing experiences to our customers. Prior to delivery of properties to our customers, our construction and quality management department conducts on-site inspections to ensure such properties are in satisfactory condition. Our sales team then arranges for our customers to inspect their purchased property prior to the expected delivery date to ensure the properties meet our prescribed standards as well as our customers’ expectations. Our customer service officers also assist customers in applying for property ownership certificate (房屋所有權證).

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After-sales services

Our sales and marketing department is responsible for our after-sales customer services and the formulation of customer service processes and standards. Our dedicated customer service officers provide comprehensive after-sales services, which include assisting customers in obtaining property title certificates and handling customer complaints. In addition, our customer service officers are responsible for collecting and analyzing customer data to identify the latest trends in customer preferences and conducting customer satisfaction surveys to help improve our projects’ market positioning, design, marketing strategies and quality of service.

Property management

We place great emphasis on property management as we believe it enhances the value of our properties and improves our brand and reputation. Our property management teams normally get involved in the early stage of property development and participate throughout the overall design planning stage to minimize future maintenance costs. We charge our customers management fees on a monthly or quarterly basis.

We provide property management services to owners of all properties developed by us through two subsidiaries that hold valid level one property management permits.

We typically enter into property management contracts with property owners which specify the services to be offered, service standards and fees. In accordance with PRC laws, we cannot assign overall management obligations to a third party but we can outsource certain responsibilities (such as cleaning and security services). According to relevant laws and regulations, the rate standards set out in the property management contracts cannot be raised without the approval of the majority of property owners.

Under PRC law, property owners have the right to engage or dismiss a property management company with the consent of more than half of the owners who hold more than 50% of the interest in the non-communal areas of the building in aggregate. As of this offering memorandum, none of our property management companies has been dismissed from any properties.

Demolition and Resettlement Costs

According to Urban Housing Resettlement Administration Regulations (城市房屋拆遷管理條例) and applicable local regulations, where we are responsible for demolishing existing properties and relocating existing residents, we will be required to pay the corresponding resettlement costs. The relevant resettlement and related costs were determined in accordance with the applicable local resettlement compensation standards. We incurred demolition and resettlement costs of RMB131.3 million, RMB30.8 million and RMB35.1 million for the years ended December 31, 2011, 2012 and 2013, respectively.

In addition, four of our projects held for future development required demolition of existing buildings, resettlement of existing residents and construction of basic infrastructure. As of the date of this offering memorandum, the respective local government authorities, which are responsible for the demolition, resettlement and construction works had not completed such work as scheduled in the relevant land grant contracts. For three of the four projects, either the land grant contracts or supplemental agreements have specified the completion of resettlement as a pre-condition for land premium payment. For the remaining projects, we obtained written approval from the respective local governments to extend the schedules of land premium payment and construction of the respective delayed resettlement projects. On this basis, we have been advised by our PRC legal advisers that it is unlikely that the PRC government authorities will impose penalties on us for the aforesaid delays.

Investment Properties and Commercial Leasing

We retain a portion of the properties we developed for rental use and/or investment. We decide whether our commercial properties will be sold or retained, for investment purposes in the early stages of each projects’ development based on various factors such as location, land use plans, regional market conditions and supporting commercial facilities. As of the date of this offering memorandum, we have three completed investment properties.

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Development of Hotels

We plan to develop and operate hotels and have commenced the construction of the Emporium Hotel, which will form part of our Future Land Emporium (新城帝景) project. Under our current plans, the Emporium Hotel is expected to have a total GFA of 38,800 sq.m. We have also engaged in active discussions and negotiations with internationally renowned hotel management groups in respect of the management of the Emporium Hotel. We also plan to develop the Gorgeous Mansion Hotel as part of our Gorgeous Mansion (憶華里) project. We expect to commence construction of the Gorgeous Mansion Hotel in 2013.

As of the date of this offering memorandum, we have not designated the Emporium Hotel or the Gorgeous Mansion Hotel for investment purposes and had not entered into any formal hotel management agreements with any party for any of our hotels under development. For details relating to the location, construction schedule and development costs of each of Future Land Emporium and Gorgeous Mansion, please refer to the paragraphs headed “Our Business – Our Property Development Projects in Changzhou – Future Land Emporium (新城帝景)” and “Our Business – Our Property Development Projects in Shanghai – Gorgeous Mansion (憶華里)” in this section.

Commercial Property Leasing and Management

We established a commercial property and leasing department to develop and expand our commercial property development, leasing and management business. With the aim to enhance our brand image as a commercial property developer and operator, our commercial property and leasing department formulates strategic plans, undertakes project management and supervision, carries out in-depth feasibility studies, devises business and marketing plans, and provides operation management services to our commercial property development and operations. To increase recurring income through a diversified portfolio of commercial properties and carparks, we intend to select tenants based on factors such as the positioning of the project, market demand in surrounding areas, level of market rent and needs of the tenants. We intend to attract large-scale anchor tenants such as well-known brands, chain cinema operators, major game centers and top catering operators and enter into long-term lease with them. We believe that our investment strategy will generate steady recurring income and significantly enhance the sales and appreciation of our investment properties.

Corporate Governance and Legal Compliance

Corporate governance and legal compliance management is carried out across our integrated organizational structure through the work of (1) our legal and compliance department that sets out and monitors our corporate governance and compliance standards and (2) all operation departments that implement such standards. We have a team of in-house lawyers to carry out legal and compliance review of all aspects of our operations. Our legal and compliance department was formally established in September 2011 with the approval of the Jiangsu Judicial Department. Its formal establishment institutionalizes our legal and compliance management, promotes legal training and compliance awareness among our employees, enhances communication with the relevant government authorities and raises our corporate governance standards.

Properties for Own Use

We rent our headquarters located at 23/F, the Great Wall Tower, No. 3000 Zhongshan North Road, Shanghai, PRC from an independent third party. In addition, we occupy a number of premises through lease or licensing arrangements.

Suppliers and Customers

Our major suppliers are construction material suppliers and construction contractors, and the five largest suppliers accounted for approximately 16.6%, 15.4% and 13.5% of our total purchases for each of the three years ended December 31, 2011, 2012 and 2013, respectively. Our single largest supplier for each of the three years ended December 31, 2011, 2012 and 2013 accounted for approximately 5.0%, 4.9% and 3.7% of our purchases, respectively. Our five largest customers accounted for approximately, 2.8%, 0.6% and 0.5% of our total revenue for each of the three years ended December 31, 2011, 2012 and 2013, and our largest customer accounted for approximately 1.7%, 0.2% and 0.1%, respectively, of our total revenue during those years.

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Awards and Recognitions

Over the past years, we have received widespread recognition from authoritative industry associations. The table below sets out some of the awards we received in respect of our property development operations:

Date		Recipient/project	Award/recognition	Awarding body

*Corporate level*	*awards*
March 2014		Future Land	Ranked as one of the Top	The Top 10 China Real
		Holdings	10 of the “2013 Top 100	Estate Research Group
			China Real Estate	(中國房地產TOP10研究
			Enterprises in terms of	組)(1)
			Consistency” (2013中國房
			地產百強企業– 穩健性10
			強)
March 2014		Future Land	Ranked as one of the Top	The Top 10 China Real
		Holdings	10 of the “2013 Top 100	Estate Research Group
			China Real Estate	(中國房地產TOP10研究
			Enterprises in terms of	組)(1)
			Operating Efficiency”
			(2013中國房地產百強企業
			– 運營效率10強)
March 2014		Future Land	Ranked as one of the Top	The Top 10 China Real
		Holdings	10 of the “2013 Top 10	Estate Research Group
			China Main Land Real	(中國房地產TOP10研究
			Estate Enterprises Listed	組)(1)
			in Hong Kong in terms of
			Ability of Fortune
			Making” (2013中國大陸在
			港上市房地產公司財富創
			造力10強)
January 2014		Future Land	Ranked 18th Among the	The Top 10 China Real
		Holdings	“2014 Top 100 China	Estate Research Group
			Real Estate Enterprises”	(中國房地產TOP10研究
			(2014年中國房地產百強企	組)(1)
			業)
March 2013		Future Land	Ranked 7th Among the Top	The Top 10 China Real
		Holdings	10 of the “2012 Top 100	Estate Research Group
			China Real Estate	(中國房地產TOP10研究
			Enterprises in terms of	組)(1)
			Profitability” (2012中國房
			地產百強企業– 盈利性10
			強)
March 2013		Future Land	Ranked 4th Among the Top	The Top 10 China Real
		Holdings	10 of the “2012 Top 100	Estate Research Group
			China Real Estate	(中國房地產TOP10研究
			Enterprises in terms of	組)(1)
			Growth Potential” (2012
			中國房地產百強企業– 成
			長性10強)

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Date	Recipient/project	Award/recognition	Awarding body

March 2013	Future Land	Ranked 4th Among the Top	The Top 10 China Real
	Holdings	10 of the “2012 Top 100	Estate Research Group
		China Real Estate	(中國房地產TOP10研究
		Enterprises in terms of	組)(1)
		Operating Efficiency”
		(2012中國房地產百強企業
		– 運營效率10強)
January 2013	Future Land	Ranked 31st Among the Top	China Real Estate
	Holdings	50 of “2012 Real Estate	Information Group (中國
		Enterprise in terms of	房地產資訊集團), China
		Contracted Sales” (2012年	Real Estate Evaluation
		中國房地產企業銷售金額	Center (中國房地產測評中
		50強)	心)
January 2013	Future Land	Ranked 21st Among the Top	China Real Estate
	Holdings	50 of “2012 Real Estate	Information Group (中國
		Enterprise in terms of	房地產資訊集團), China
		Contracted GFA” (2012年	Real Estate Evaluation
		中國房地產企業銷售面積	Center (中國房地產測評中
		50強)	心)
March 2012	Future Land	Ranked 19th Among the	The Top 10 China Real
	Holdings	“2012 Top 100 China	Estate Research Group
		Real Estate Enterprises”	(中國房地產TOP10研究
		(2012中國房地產百強企	組)(1)
		業)
March 2012	Future Land	Ranked 7th Among the Top	The Top 10 China Real
	Holdings	10 of the “2012 Top 100	Estate Research Group
		China Real Estate	(中國房地產TOP10研究
		Enterprises in terms of	組)(1)
		Profitability” (2012中國房
		地產百強企業– 盈利性10
		強)
March 2012	Future Land	Ranked 4th Among the Top	The Top 10 China Real
	Holdings	10 of the “2012 Top 100	Estate Research Group
		China Real Estate	(中國房地產TOP10研究
		Enterprises in terms of	組)(1)
		Growth Potential” (2012
		中國房地產百強企業– 成
		長性10強)
March 2012	Future Land	Ranked 4th Among the Top	The Top 10 China Real
	Holdings	10 of the “2012 Top 100	Estate Research Group
		China Real Estate	(中國房地產TOP10研究
		Enterprises in terms of	組)(1)
		Operating Efficiency”
		(2012中國房地產百強企業
		– 運營效率10強)

– 147 –

Date	Recipient/project	Award/recognition	Awarding body

March 2012	Future Land	Ranked 4th Among the Top	www.fangchan.com (中房網)
	Holdings	10 of the “2012 Top 500
		China Real Estate
		Enterprises in terms of
		Operating Efficiency”
		(2012中國房地產500強運
		營效率10強)
March 2012	Future Land	Ranked 4th Among the	China Real Estate Research
	Holdings	“2012 Top 10 Developing	Association (中國房地產
		China Real Estate	研究會), China Real
		Enterprises in terms of	Estate Industry Federation
		Operating Efficiency”	(中國房地產業協會) and
		(2012中國房地產開發企業	China Real Estate
		運營效率10強)	Evaluation Center (中國房
			地產測評中心)
January 2012	Future Land	Ranked 24th Among the Top	China Real Estate
	Holdings	50 of “2011 Real Estate	Information Group (中國
		Enterprise in terms of	房地產信息集團), China
		Contracted Sales” (2011年	Real Estate Evaluation
		房企銷售金額50強)	Center (中國房地產測評中
			心)
January 2012	Future Land	Ranked 20th Among the Top	China Real Estate
	Holdings	50 of “2011 Real Estate	Information Group (中國
		Enterprise in terms of	房地產信息集團), China
		Contracted GFA” (2011年	Real Estate Evaluation
		房企銷售面積50強)	Center (中國房地產測評中
			心)
November 2011	Future Land	China Well-Known	People’s Republic of China
	Holdings	Trademark	– State Administration for
		(中國馳名商標)	Industry and Commerce,
			Trademark Office (中華人
			民共和國– 國家工商行政
			管理總局商標局)
June 2011	Jiangsu Future	2011 China Listed Real	The Top 10 China Real
	Land	Estate Company – Top 10	Estate Research Group
		in terms of Economic	(中國房地產TOP10研究
		Value Added (2011滬深上	組)(1)
		市房地產公司財富創造能
		力Top 10)
March 2011	Future Land	2011 Top 20 Real Estate	China Real Estate Research
	Holdings	Development Enterprise	Association (中國房地產
		in China Award (2011年	研究會), China Real
		中國房地產開發企業20	Estate Industry Federation
		強)	(中國房地產業協會) and
			China Real Estate
			Evaluation Center (中國房
			地產測評中心)

– 148 –

Date	Recipient/project	Award/recognition	Awarding body

September 2010	Jiangsu Future	Ranked 1st Among the	The Top 10 China Real
	Land	“2010 Top 10 Valuable	Estate Research Group
		Real Estate Brands in	(中國房地產TOP10研究
		Eastern China” (2010中國	組)(1)
		華東房地產公司品牌價值
		Top 10)
*Project level awards*
December 2011	Changsha Future	2011 Architectural Culture	Beijing Jingrui Housing
	Land	Award – Award of	Technology Foundation
	International	Excellence (2011建築文化	(北京精瑞住宅科技基金
	Metropolis	獎– 優秀獎)	會)
December 2010	Future Capital	Green Ecology Architecture	Beijing Jingrui Housing
		Award – Award of	Technology Foundation
		Excellence (綠色生態建築	(北京精瑞住宅科技基金
		獎– 優秀獎)	會)
December 2010	New Golden Town	Jiangsu Excellent	Jiangsu Province
		Residential Property and	Department of Housing
		Model Housing Award (江	and Urban-Rural
		蘇優秀住宅及成品住房示	Development, and
		範工程)	Housing & Real Estate
			Promotion Center (江蘇省
			住房和城鄉建設廳，住宅
			與房地產業促進中心)
July 2009	Future Land	2009 Shanghai Four Best	Shanghai Housing Security
	Glorious View	Communities Award in	and Housing Management
	Garden	terms of Energy	Authority (上海市住房保
		Conservation and Land	障和房屋管理局)
		Efficiency (2009年度創建
		上海市節能省地型“四高”
		優秀社區)

(1) The Top 10 China Real Estate Research Group (中國房地產 TOP10研究組) is a research team jointly established by the Enterprise Research Institute of the Development Research Centre of the State Council (國務院發展研究中心企業研究所), Tsinghua University Real Estate Research Institute (清華大學房地產研究所) and China Index Research Institute (中國指數研究院).

Competition

The property market in China is highly fragmented. Our existing and potential competitors include major domestic developers and, to a lesser extent, foreign developers primarily from Asia, including leading developers from Hong Kong. We compete with them in relation to a number of factors, including the acquisition of land, brand recognition, financial resources, price, product quality, service quality and other factors. Some of these competitors may have better track records, greater financial, human and other resources, larger sales networks and greater brand recognition.

In particular, the residential property and mixed-use complex markets in the Yangtze River Delta have been highly competitive in recent years. Property developers from the PRC and overseas have entered the property development markets in Changzhou, Nanjing, Suzhou, Kunshan, Wuxi, Shanghai and other cities in the Yangtze River Delta. The rapid development of major cities in Jiangsu Province and Shanghai in recent years has led to a diminishing supply of undeveloped land in desirable locations in the Yangtze River Delta. Moreover, the PRC government has implemented policies tightly controlling the amount of new land available for development. These factors have increased competition and land grant premiums in relation to land made available for development. According to a report by the China Index Academy, we were ranked as one of the top three property developers in Jiangsu Province and among the top ten in Shanghai in 2011, 2012 and 2013 in terms of contracted sales. We were ranked first among the property developers in Jiangsu Province and among the top ten in Shanghai in 2013 in terms of contracted GFA.

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We believe that, with our rapid asset turnover model, diversified product portfolio and strategic focus on middle class customers, we have demonstrated resiliency to market changes and competition.

Intellectual Property

We conduct our business under various trademarks which we have registered in the PRC and Hong Kong. We are also the registered owner of the domain names “futureholdings.com.cn” and “www.900950.com”.

We are not aware of any infringement (i) by us of any intellectual property rights owned by third parties, or (ii) by any third parties of any intellectual property rights owned by us.

Insurance

We maintain insurance policies for our properties and assets and carry employer’s liability insurance as required by the relevant local authorities, such as those for medical and related expenses that our employees may incur as a result of personal injuries at their workplaces or on the construction sites of our property developments. We also maintain insurance policies including property all-risk insurance and public liability insurance, with respect to our investment properties, including insurance coverage for damages arising from or in connection with the occurrence of an earthquake.

According to applicable PRC laws and regulations, property developers are not required to maintain insurance coverage in respect of their property development operations. As such, we generally do not maintain and do not require our construction contractors to maintain insurance coverage on our properties developed for sale other than for properties for which we are required to maintain insurance coverage under loan agreements. We do not maintain insurance policies for properties that have been delivered to our customers. Instead, the respective property management companies of each of our projects maintain all property risk insurance and public liability insurance for the common areas and amenities of these properties.

Under PRC laws, construction companies as employers are required to purchase insurance for their construction workers. As we engage third-party contractors to carry out construction for our projects, we currently do not maintain such insurance ourselves.

We believe that our insurance coverage is adequate and is in line with customary industry practices of property developers. However, there are risks for which we do not have sufficient or any insurance coverage for losses, damages and liabilities that may arise in our business operations.

Environmental Matters

Property developers in China are subject to a number of environmental laws and regulations. We expect our environmental compliance costs will remain similar to our historical costs. We have not been imposed any fines or penalties for non-compliance of PRC environmental laws and regulations. As of the date of this offering memorandum, we have not encountered any material issues in passing inspections conducted by the relevant environmental authorities upon completion of our properties.

Labor and Safety

Property developers in China are subject to various PRC laws and regulations with respect to labor, health, safety, insurance, and accidents issued by the relevant governmental authorities from time to time, for our operations in the PRC. We have not been imposed any fines or penalties for non-compliance of PRC labor and safety laws and regulations.

Compliance

On June 21, 2012, we entered into an acquisition agreement with Shanghai Jiading to acquire 100% of the equity interest in Shanghai Fuming, which holds land use rights to the land parcels that comprise our Baiyin Road A11-4 Land Parcel Project (the “ A11-4 Land Parcels ”). The A11-4 Land Parcels have a total GFA of 70,732 sq.m. and are located between the land parcels that comprise our Park View International Community A Project and Park View International Community B Project.

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Prior to the acquisition, we discovered that the A11-4 Land Parcels could be categorized as idle land. The land grant contract of the A11-4 Land Parcels required the holder of the land use rights to commence construction before July 5, 2011, but construction had not commenced at the time of our acquisition. Pursuant to the acquisition agreement, Shanghai Jiading agreed to indemnify us any idle land penalties that may be imposed on us in connection with the A11-4 Land Parcels. We believe our risks associated with the A11-4 Land Parcels are remote and therefore have not made any provision for any potential penalties.

Since our acquisition of Shanghai Fuming, we have obtained the construction land planning permit for the A11-4 Land Parcels. As of the date of this offering memorandum, we have obtained all licenses, permits and certificates required for and had commenced the development of the A11-4 Land Parcels.

Save as disclosed above, we were advised by our PRC legal advisers that as of the date of this offering memorandum, we have complied, with all relevant and applicable PRC laws and regulations governing the business of property development and management in all material respects and have obtained all licenses, permits and certificates required to carry out our business.

Legal Proceedings

As a property developer in the PRC, we are subject to legal or arbitration proceedings, disputes or claims in the ordinary course of business from time to time. We are not, as of the date of this offering memorandum, involved in any litigation, arbitration or claim of material importance pending or threatened by us or against us that would have a material adverse effect on our results of operations or financial condition.

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REGULATION

Overview

All land in the PRC is either state-owned or collectively-owned, depending on the location of the land. All land in urban areas of a city or town is state-owned, and all land in the rural areas and suburban areas and all farm land are, unless otherwise specified by law, collectively-owned. The State has the right to resume its ownership of land or the land use rights in accordance with law if required for the public interest (and compensation must be paid by the state).

Although all land in the PRC is owned by the State or by collectives, individuals and entities may obtain land use rights and hold such land use rights for development purposes. Individuals and entities may acquire land use rights in different ways, the two most important being land grants from local land authorities and land transfers from land users who have already obtained land use rights.

Land Grants

National and local legislation

In April 1988, the National People’s Congress (the “ NPC ”) passed an amendment to the Constitution of the PRC. The amendment, which allowed the transfer of land use rights for value, paved the way for reforms of the legal regime governing the use of land and transfer of land use rights. In December 1988, the Standing Committee of the NPC also amended the Land Administration Law of the PRC (中華人民共和國土地管理法) to permit the transfer of land use rights for value.

In May 1990, the State Council (國務院) enacted the Provisional Regulations of the PRC Concerning the Grant and Assignment of the Right to Use State-owned Land in Urban Areas (中華人民共和國城鎮國有土地使用權出讓和轉讓暫行條例). These regulations, generally referred to as the Urban Land Regulations, formalized the process of the grant and transfer of land use rights for consideration. Under this system, the State retains the ultimate ownership of the land. However, the right to use the land, referred to as land use rights, can be granted by the state and local governments at or above the county level for a maximum period of 70 years for specific purposes pursuant to a land grant contract and upon payment to the State of a premium for the grant of land use rights.

The Urban Land Regulations prescribe different maximum periods of grant for the different uses of land as follows:

Use of land	Maximum period

	(Years)
Commercial, tourism, entertainment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	40
Residential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	70
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	50
Educational, scientific, cultural, public health and sports . . . . . . . . . . . . . . . . . . . . . .	50
Comprehensive utilization or others. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	50

Under the Urban Land Regulations, domestic and foreign enterprises are permitted to acquire land use rights unless the law provides otherwise. The state may not resume possession of lawfully-granted land use rights prior to expiration of the term of grant. Should the public interest require the resumption of possession by the State under special circumstances during the term of grant, compensation shall be paid by the State, on the basis of the period of which the land user has used the land and the status with respect to the development and utilization of the land. Subject to compliance with the terms of the land grant contract, a holder of land use rights may exercise substantially the same rights as a land owner during the grant term, including holding, leasing, transferring, mortgaging and developing the land for sale or lease.

Upon paying in full the land premium pursuant to the terms of the contract, a land-grantee may apply to the relevant land bureau for the land use rights certificate. In accordance with the Property Rights Law (中華人民共和國物權法), which was effective as of October 1, 2007, the term of land use rights for land of residential use will automatically be renewed upon expiry. The renewal of the term of land use rights for other use shall be dealt with according to the then-current relevant laws. In addition, if public interest requires the resumption of possession of land by the State during the term of the relevant land use rights, owners of residential properties and other real estate on the land shall be compensated and the relevant land premium shall be refunded to them.

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On March 26, 2005, the General Office of the State Council promulgated the Notice on Effectively Stabilizing House Prices (關於切實穩定住房價格的通知) to restrain the excessive increase of housing prices and to promote the sound development of the real estate market. The notice provided that housing prices should be stabilized and the system governing housing supply should be vigorously adjusted and improved. In accordance with the notice, seven departments of the State Council including the Ministry of Construction (建設部) issued the Opinion on the Work of Stabilizing Housing Prices (關於做好穩定住房價格工作的意見) on April 30, 2005. The Opinion stated, among other things, that: (i) the local government should focus on ensuring the supply of low-to medium-end ordinary residential houses while controlling the construction of high-end residential houses; (ii) to curb any speculation in the real estate market, a 5% business tax would be levied from June 1, 2005 on the total revenue arising from any transfer by individuals of houses within two years from their purchase thereof or on the difference between the transfer price and the original price for any transfer of non-ordinary houses (非普通住宅) by individuals after two or more years from their initial purchase thereof; and (iii) the real estate registration department will no longer register the transfer of apartment units which are pre-sold where such units have not obtained the relevant property ownership certificates.

Pursuant to these measures, local governments were required to adopt plans, by September 2006, to focus on developing low-to-mid-priced and small-to-medium-size properties to meet demand from owner-occupiers. These measures stipulate that commencing from June 1, 2006, the minimize down payment was 30% of the total purchase price for residential units with floor area exceeding 90 square meters on all existing units and those yet to be completed, or a down payment of 20% on residential units for occupation by the owner with floor areas under 90 square meters. The measures require that at least 70% of the residential units in residential housing projects approved or commenced after June 1, 2006 must be no larger than 90 square meters. The measures continue to prohibit land provision for houses and restrict land provision for development of low density and large residential property.

On May 24, 2006, the General Office of the State Council further issued the Notice on Adjusting the Housing Structure and Stabilizing Housing Prices (關於調整住房供應結構穩定住房價格意見的通知). The Notice provided for the following broad directives to, among other things: (i) encourage mass-market residential developments and curb the development of high-end residential properties; (ii) enforce the collection of the 5% business tax on property sales (business taxes will be levied on the entire sale price of any property sold within five years, or on the profit arising from any property sold after five years subject to possible exemptions for ordinary residential properties); (iii) restrict housing mortgage loans to not more than 70% of the total property price (for houses purchased for self-residential purposes and with an area of less than 90 sq.m., the owners are still able to apply for a housing mortgage up to an amount representing 80% of the total property price); (iv) halt land supply for villa projects and restrict land supply for high-end, low-density residential projects; (v) moderate the progress and scale of demolition of old properties for re-development; (vi) require local governments to ensure that at least 70% of the total development and construction area must consist of units of less than 90 sq.m. in size (with any exceptions requiring the approval of the Ministry of Construction); and (vii) prevent banks from providing loans to a property developer whose total capital fund is less than 35% of the total investment amount in an intended development project.

On June 13, 2006, the General Office of the State Council issued the Notice on Further Regulating and Controlling Investment in Fixed Assets and Strictly Controlling the Number of New Projects (關於加強固定資產投資調控從嚴控制新開工項目意見的通知). The notice provides for: (i) clearing and rectifying all new projects; (ii) strictly examining all planning projects, strengthening supervision and examination on implementing industry policy, development plan, market access requirements and construction procedures across the country; and (iii) strictly controlling loans provided for infrastructure.

On July 6, 2006, the Ministry of Construction promulgated Certain Opinions regarding the Implementation of the Ratio Requirements for the Structure of Newly Constructed Residential Units (關於落實新建住房結構比例要求的若干意見), or the New Opinions. The New Opinions stipulate that, the residential units with a floor area of less than 90 square meters shall account for over 70% of the total area of residential units, which are newly approved and constructed in each city or county after June 1, 2006. The relevant local government will have authority to determine the configuration of newly constructed property.

On July 13, 2006, the General Office of the State Council issued the Notice about Relevant Matters on Establishing the State Land Supervision System (關於加強土地調控有關問題的通知). In accordance with this notice, the Ministry of Land and Resources established the State Land Supervision General Office (國家土地總督察辦公室) and send its local counterparts State Land Supervision Bureau (國家土地督察局) in order to strengthen supervision and management on land and practice the strictest possible land management system.

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On August 31, 2006, the State Council issued a Notice about Relevant Matters on Strengthening Control on Land (關於加強土地調控有關問題的通知) in order to hold back the problems of excessive increases in the aggregate amount of construction land, the excessive expansion of low-cost industrial land, the illegal use of land and abusive occupation of cultivated land. The notice implements the following major measures: (i) adjusting land approval measures for urban construction in accordance with the principle of sharing both rights and responsibilities; (ii) only after guaranteeing the social security fee for the land expropriated from farmers can the approval of land expropriation be granted; (iii) the total amount of money from the sale of state-owned land use rights shall be fully accounted for in the local budget and collected into the local government treasury, and the “line of income and expenditure” shall be administrated separately; (iv) raising the standard for the land use rights fee of newly added construction land as well as the urban land use tax and rural cultivated land use tax; (v) the State formulating and promulgating the unified minimize standard for granting industrial land across the country, and industrial land being granted by tender, auction or putting up for bidding; and (vi) prohibiting conversion of agricultural land into construction land “in the name of leasing while actually expropriating” or other illegal ways.

On November 7, 2006, Ministry of Finance, Ministry of Land and Resources and the PBOC issued a Notice about Relevant Matters on Policy Adjusting Concerning the Land Use Fee for Newly Created Construction Land (關於調整新增建設用地土地有償使用費政策等問題的通知). The notice requires the land use fee on newly created construction land be doubled from January 1, 2007.

On March 29, 2007, the Ministry of Construction, the Ministry of Land and Resources, the Ministry of Finance, National Audit Office, the Ministry of Supervision, the SAT, the National Development and Reform Commission (the “ NDRC ”) and the SAIC issued the Notice on the Regulation of the Real Estate Marker Order (關於開展房地產市場秩序專項整治的通知). This notice aims to examine the unauthorized approval and abuse of power in the areas of project establishment, planning approval, work permit administration, pre-sale permit administration by the relevant departments and working personnel involved in real estate-related fields as well as the implementation of tax policies with respect to real estate. It will also allow for the inspection of real estate enterprises to see if they illegally publish advertisements, hoard properties, drive up prices, swindle or conspire with other parties, evade taxes or properly conduct compulsory demolitions and resettlements. Further review and examination will take place with respect to real estate enterprises that are found to have violated these rules.

Pursuant to the Opinions on Resolving Difficulties of Housing for Urban Low-income Family (關於解決城市低收入家庭住房困難的若干意見) promulgated by the State Council on August 7, 2007, the authorities of each region will adjust the housing supply structure in order to: (i) implement the Circular on Forwarding Opinions of Ministry of Construction and Other Departments on Adjusting Housing Supply Structure and Stabilizing Housing Prices issued by the General Office of the State Council (國務院辦公廳轉發建設部等部門關於調整住房供應結構穩定住房價格意見的通知); (ii) focus on the development of low to medium priced, and small to medium sized commodity housing and (iii) to increase the supply of housing. The approval percentage of new housing construction (with a GFA of less than 90 sq.m.) will be more than 70% of the total housing developed area. The annual supply of low rental housing construction land, economy-sized housing and low to medium price and small to medium sized commodity housings shall not be less than 70% of the total residential housing land.

Pursuant to the Notice on Implementation of the Several Opinions of the State Council on Solving Housing Shortage with respect to Urban Low-income Households (關於認真貫徹國務院關於解決城市低收入家庭住房困難的若干意見進一步加強土地供應調控的通知) promulgated by Ministry of Land and Resources on September 30, 2007, the administration department of the Ministry of Land and Resources (the “ Administration Department ”) at both municipality and county levels will give priority in arranging land supply for low rental housing, economy-sized housing and low to medium priced and small to medium sized commodity housing. Its annual supply volume shall not be less than 70% of total residential land supply. It will integrate and implement the Notice on the Implementation of Specific Clearing of the Grant of the State-owned Land Use Rights (關於開展國有土地使用權出讓情况專項清理工作的通知) jointly published by the Ministry of Supervision, Ministry of Land and Resources, Ministry of Finance, National Audit Office of the PRC and the Ministry of Construction on August 8, 2007. Further, it will investigate, on a case by case basis, the development of residential land with an emphasis on the observation of land-use contract by real estate development enterprises. For any developer that neither commences nor completes the construction work in accordance to the land-use contract, the Administration Department will provide comments to ensure that such enterprises complete the development on schedule. Enterprises that do not carry out any measure to resolve the situation will be prohibited from participating in any tenders, auction and putting up for bidding for acquiring new land sites. The Administration Department will strictly enforce the regulations governing idle land and for land where

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the construction still has not commenced after exceeding one full year from the date of commencement stipulated in the contract, the idle land fee shall be imposed and the respective enterprises will be instructed to commence the construction works and fulfill the completion schedule. The idle land fee, in principle, shall be computed and imposed based on 20% of land premium price of the granted or allocated land. Any land that has not been developed for over two years shall be reclaimed with no compensation. For land where construction works have been commenced on the date stipulated in the contract but the developed area is less than the one-third of the area to be developed or the invested capital is less than one-fourth of the total investment as stipulated in the contract and the development is suspended over a year without any approval, it shall be treated as idle land strictly following the laws.

On December 30, 2007, the General Office of the State Council issued the Notice on the Strict Implementation of the Laws and Policies Regarding Rural Collective Construction Land (Guo Fa Ban 2007 No. 71) (關於嚴格執行有關農村集體建設用地法律和政策的通知) (國辦發2007 71號). This notice states that residential land in rural areas shall only be allocated to residents of the relevant village residing in the area and that no urban inhabitants shall be allowed to purchase any homesteads, peasants’ dwellings or “small houses with property rights” in rural areas. No organization or individual shall be allowed to illegally rent or occupy any land collectively owned by peasants for the development of real estate.

On February 7, 2008, the State Council issued the Land Investigation Regulations (Order No. 518 of the State Council of the People’s Republic of China) (土地調查條例 (中華人民共和國國務院令第518號)). This regulation provides that a nationwide land investigation shall be carried out once every 10 years and a land status alteration investigation shall be carried out each year by the competent state land and resources department at the county level or above and this investigation is done in conjunction with the relevant government departments of the same level. The regulation also specifies the qualification requirements that a government department must meet in order to undertake the investigation tasks. The regulation specifies that the purpose of land investigations is to ascertain the land resources that are available and their utilization status.

On January 7, 2010, the General Office of the State Council issued the Notice on Promoting the Steady and Healthy Development of the Real Estate Market (關於促進房地產市場平穩健康發展的通知), which, among other things, provides that land resource authorities shall deepen the supervision on the compliance of the contracts and strictly collect the land premiums according to the land grant contracts, and shall:

effectively increase the supply of social welfare housing and ordinary commodity residential properties, in particular, low and medium-cost and small and medium-sized ordinary commodity residential properties;
direct consumers to make reasonable purchases of residential properties and discourage investment and speculation in the housing market;
strengthen credit risk management for real estate projects and market supervision;
speed up the construction of social welfare housing projects; and
set or clarify the responsibilities of provincial and local governments.

On March 8, 2010, the Ministry of Land and Resources issued the Notice on Strengthening the Supply and Supervision of Land Use for Real Estate Property (國土資源部關於加強房地產用地供應和監管有關問題的通知). The Notice, among other things, provides that:

the land and resources bureau at the city and county levels shall ensure that the land supply for government-subsidized housing, slum-dwellers reconstruction and small commercial housing units for self housing shall not be less than 70% of the total residential land supply and strictly control the land supply for large-sized apartments and restrict the land supply for villas;
land resource authorities shall prohibit property developers who owe land grant premium payments, possess idle land, engage in land speculation and price manipulation, conduct project development exceeding approved scope or fail to conform with the land use rights grant contract from land bidding transactions within a set period of time; and

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the land use rights grant contract must be executed within ten days after a grant of land has been mutually agreed and a down payment of 50% of the land grant premium shall be paid within one month from the execution of the land use rights grant contract with the remaining amount paid no later than one year after the execution of the land use rights grant contract.

On September 21, 2010, the Ministry of Land and Resources and MOHURD jointly promulgated the Notice on Further Strengthening Control and Regulation of Land and Construction of Property Development (關於進一步加強房地產用地和建設管理調控的通知), which stipulates, among other things, that: (i) at least 70% of land designated for construction of urban housing must be used for affordable housing, housing for resettlement of shanty towns and small to medium-sized ordinary commercial housing; in areas with high housing prices, the supply of land designated for small to medium-sized, price-capped housing must be increased; (ii) developers and their controlling shareholders are prohibited from participating in land biddings before the rectification of certain misconduct, including (1) illegal transfer of land use rights; (2) failure to commence required construction within one year from the delivery of land under land grant contracts due to such developers’ own reasons; (3) noncompliance with the land development requirements specified in land grant contracts; and (4) crimes such as obtaining land by forging official documents and illegal land speculation; (iii) developers are required to commence construction within one year from the date of delivery of land under the relevant land grant contract and complete construction within three years of commencement; (iv) development and construction of projects of low-density and large-sized housing must be strictly limited and the plot ratio of the planned GFA to the total site area of residential projects must be more than 1:1; and (v) the grant of two or more bundled parcels of lands and undeveloped land is prohibited.

In December 2010, the Ministry of Land and Resources promulgated the Notice on Strict Implementation of Policies Regarding Regulation and Control of Real Property Land and Promotion of the Healthy Development of Land Markets (關於嚴格落實房地產用地調控政策促進土地市場健康發展有關問題的通知), which, among other things, provides that (i) cities and counties that have less than 70% of their land supply designated for affordable housing, redevelopment housing for shanty towns or small/medium-sized residential units shall not provide land for large-sized and high-end housing before the end of 2010; (ii) local land and resources authorities shall file a transaction report with the Ministry of Land and Resources and provincial land and resources authorities, respectively, in relation to land sold via competitive bidding, auction and listing-for-sale with a 50% or more premium; and (iii) for land designated for affordable housing but used for the development of commodity houses, any illegal income derived therefrom will be confiscated and the relevant land use rights terminated. In addition, unapproved changes to the plot ratio are strictly prohibited.

On January 26, 2011, the General Office of the State Council issued the Notice on Relevant Issues of Further Improvement of the Control in Real Estate Market (進一步做好房地產市場調控工作有關問題的通知). This Notice, among other things, provides that:

individuals selling housing properties within five years of purchase will be charged business taxes on the full amount of sale price, whether ordinary or non-ordinary;
the minimize down payment for second home purchases increases from 50% to 60%;
the developer will forfeit the land use rights and the PRC government will impose an idle land fee of up to 20% of the land premium if a developer fails to obtain the construction permit and commence development for more than two years from the commencement date stipulated in the land grant contract; and
municipalities directly under the central government, municipalities with independent planning status, provincial capitals and cities with high housing prices shall limit the number of homes local residents can buy in a specific period. In principle, local resident families that own one house and non-local resident families who can provide local tax clearance certificates or local social insurance payment certificates for a required period are permitted to purchase only one additional house (including newly built houses and second-hand houses). Sales of properties to (i) local resident families who own two houses or more, (ii) non-local resident families who own one house or more, and (iii) non-local resident families who cannot provide local tax clearance certificates or local social insurance payment certificates for a required period shall be suspended in local administrative regions.

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On February 26, 2013, the General Office of the State Council announced the Notice on Continuing Adjustment and Control of Property Markets (國務院辦公廳關於繼續做好房地產市場調控工作的通知). This notice further clarified the requirements of the State Council:

Improving the stabilization mechanism for housing prices. The provincial and municipal governments shall strengthen their administration on the property market, including increasing the supply of properties and setting annual pricing targets at cities where the property prices rise too fast. The relevant departments of the State Council will strengthen the supervision on the provincial governments with respect to the price stabilization work.
Restraining speculative investment. The policies require a strict implementation of purchase limits and credit restrictions and set to expand the scope of property tax pilots. The notice requires local governments to strictly implement purchase limits. If the property prices in any cities rise too fast and there is yet any purchase limit policy in place, the relevant provincial governments should require such cities to adopt purchase limit policies promptly. Financial institutions are required to strictly implement credit policies with respect to down-payment ratios and interest rates for mortgages and to review the backgrounds of mortgage applicants more rigorously. The local offices of the People’s Bank of China may also increase the interest rates and down-payment ratios for mortgages on second properties if the property prices in any cities rise too fast. The tax authority together with the building and construction authority are required to work closely to impose a 20% individual income tax on the gain from the sale of second-hand properties.
Increasing the supply of land and ordinary commodity housing units. The notice also encourages the supply of land for residential purposes. The relevant authorities are required to speed up the approval processes for property developments with small-to-medium sized units. Financial institutions are required to give priority to projects where small-to-medium sized units account for more than 70% of the total units.
Speeding up the planning and construction of affordable housing.
Strengthening market regulations and managing market expectation.
Speeding up to establish and perfect a long-term mechanism to guide the healthy development of the real estate market.

On March 28, 2013, the General Office of the State Council issued a Notice on the Division of Tasks for Implementing the Scheme for Reform and Function Transformation of Institutions under the State Council (國務院辦公廳發佈關於實施國務院機構改革和職能轉變方案任務分工的通知), specifying the requirements and division of all tasks and setting out the specific time schedules for each task. According to the Notice, the task to integrate duties of housing registration, forestland, grassland and land registration shall be completed before the end of April, 2013. The Ministry of Land and Resources and the Ministry of Housing and Urban-Rural Development, jointly with taxation authority and other relevant governmental departments are responsible for introducing and implementing a unified real estate registration system. The regulation on real estate registration is expected to be promulgated by the end of 2014.

In addition to the general framework for transactions relating to land use rights set out in the Urban Land Regulations, local legislation may provide for additional requirements, including those applicable to specific transactions within specific areas relating to the grant and transfer of land use rights. These local regulations are numerous and some of them are deemed to be inconsistent with national legislation. Under PRC laws, national laws and regulations prevail to the extent of such inconsistencies.

Environmental Protection

The laws and regulations governing the environmental requirements for real estate development in the PRC include the Environmental Protection Law (中華人民共和國環境保護法), the Prevention and Control of Noise Pollution Law (中華人民共和國環境噪聲污染防治法), the Environmental Impact Assessment Law (中華人民共和國環境影響評價法), the Administrative Regulations on Environmental Protection for Development Projects (建設項目環境保護管理條例) and the Administrative Regulations on Environmental Protection for Acceptance Examination Upon Completion of Buildings (建設項目竣工環境保護驗收管理辨法). Pursuant to these laws and regulations, depending on the impact of the project on the environment, an environmental impact

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study report, an environmental impact analysis table or an environmental impact registration form must be submitted by a developer before the relevant authorities will grant approval for the commencement of construction of the property development. In addition, upon completion of the property development, the relevant environmental authorities will also inspect the property to ensure compliance with the applicable environmental standards and regulations before the property can be delivered to the purchasers.

Modes of land grant

Pursuant to PRC laws and the stipulations of the State Council, except for land use rights which may be obtained through allocation (劃撥), land use rights for property development are obtained through governmental grant. There are two methods by which land use rights may be granted, namely by private agreement or competitive processes (i.e., tender, auction or listing at a land exchange administered by the local government).

As of July 1, 2002, the grant of land use rights by way of competitive processes is governed by the Regulations on the Grant of Use Right of State-owned Land by Invitation of Tender, Auction or Listing-forbidding (招標拍賣掛牌出讓國有土地使用權規定), issued by the Ministry of Land and Resources of the PRC on May 9, 2002 (the “ 2002 Regulations ”) and revised as of September 21, 2007 with the name of Regulations on Granting State-owned Construction Land Use Rights through Tenders, Auction and Putting up for Bidding (招標拍賣掛牌出讓國有建設用地使用權規定) (the “ 2007 Regulations ”). Following the 2002 Regulations, the Ministry of Land and Resources issued the Notice on Continuing the Review of the Implementation of the Grant of Land use Rights for Commercial Use by Invitation of Bids Auction or Listing (關於繼續開展經營性土地使用權招標拍賣掛牌出讓情况執法監察工作的通知) on a Land Exchange on March 31, 2004, requiring all local land administration authorities to strictly enforce the 2002 Regulations. In addition, the Ministry of Land and Resources required that with effect from August 31, 2004, the grant of land use rights must be made pursuant to auctions or listing at a land exchange and that no land use rights for commercial use may be granted by way of agreement. In the Urgent Notice of the General Office of the State Council on Intense Regulation and Rectification of the Land Market and Strict Administration of Land (關於深入開展土地市場治理整頓嚴格土地管理的緊急通知) issued by the State Council on April 29, 2004, the development of agricultural land was suspended for a period of six months for rectification by the PRC government of irregularities in land development in China. The 2007 Regulations specifically provide that land to be used for industrial, commercial, tourism, entertainment or commodity residential purposes, or where there are two or more intended users for the certain piece of land, must be granted by way of competitive processes. A number of measures are provided by the 2007 Regulations to ensure such grant of land use rights for commercial purposes is conducted openly and fairly. For instance, the local land bureau must take into account various social, economic and planning considerations when deciding on the use of a certain piece of land, and its decision regarding land use designation is subject to approval of the city or provincial government. The grantee shall apply for land registration and obtain the state-owned land use rights certificate upon full payment of the land premium of the granted land according to the state-owned land grant contract. In the event that the land premium of the granted land is not paid in full, the grantee will not receive the land use rights certificate. In addition, the announcement of tender, auction or listing-for bidding must be made 20 days prior to the date on which such competitive process begins. Further, it also stipulated that for listing at a land exchange, the time period for accepting bids must be no less than 10 days. On May 13, 2011, the Ministry of Land and Resources promulgated the Opinions on Upholding and Improving the System for the Transfer of Land by Tender, Auction and Listing (關於堅持和完善土地招標拍賣掛牌出讓制度的意見), which provides, among other things, that (i) correct utilization of the regulating and controlling effects of the land transfer policy through tender, auction and listing; (ii) improvement in the transparency of the system of tender, auction and listing for housing land; (iii) adjustment and improvement in the land transfer policy through tender, auction and listing, including (a) limitation on house price or land price, and transfer of policy-related housing land by listing or auction; (b) limitation on the GFA of allocated security housing, and transfer of commodity housing land by listing or auction; (c) carrying out of comprehensive assessment on conditions of land development and utilization and land transfer prices, and determination of the person who is entitled to land use rights by tender; (iv) promotion of online operation of the transfer of land use rights; (v) improvement in the contracts for land transfer through tender, auction and listing.

In the case of tender, the local land bureau granting the land use rights should examine the qualifications of the intended bidders and inform those qualified to participate in the bidding processes by sending out invitations to tender. Bidders are asked to submit sealed bids together with the payment of a security deposit. When land use rights are granted by way of tender, a tender evaluation committee consisting of not less than five members (including a representative of the grantor and other expert), formed by the land bureau is responsible for opening the tenders and deciding on the successful bidder. The successful bidder will then sign the land grant contract with the land bureau and pay the balance of the land premium before obtaining the State land use rights certificate.

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Where land use rights are granted by way of auction, a public auction will be held by the relevant local land bureau. The land use rights are granted to the highest bidder. The successful bidder will then be asked to sign the land grant contract with the local land bureau and pay the relevant land premium within a prescribed period.

Where land use rights are granted by way of listing-for-sale administered by the local government, a public notice will be issued by the local land bureau to specify the location, area and purpose of use of land and the initial bidding price, period for receiving bids and terms and conditions upon which the land use rights are proposed to be granted. The land use rights are granted to the bidder with the highest bid who satisfies the terms and conditions. The successful bidder will enter into a land grant contract with the local land bureau and pay the relevant land premium within a prescribed period.

In June 2003, the Ministry of Land and Resources promulgated the Regulations on Grant of State-owned Land Use Rights by Agreement (協議出讓國有土地使用權規定), or the 2003 Regulations, to regulate granting of land use rights by agreement when there is only one party interested in the land, the designated use of which is other than for commercial purposes as described above. According to the 2003 Regulations, the local land bureau, together with other relevant government departments, including the city planning authority, will formulate the plan concerning the grant, including the specific location, boundary, purpose of use, area, term of grant, conditions of use, conditions for planning and design as well as the proposed land premium, which shall not be lower than the minimize price regulated by the State, and submit such plan to the relevant government for approval. Afterwards, the local land bureau and the relevant party will negotiate and enter into the land grant contract based on the above-mentioned plan. If two or more parties are interested in the land use rights proposed to be granted, such land use rights shall be granted by way of tender, auction or listing at a land exchange in accordance with the 2007 Regulations.

The grantee is required to pay the land premium pursuant to the terms of the contract and the contract is then submitted to the relevant local bureau for the issue of the land use rights certificate. Upon expiration of the term of grant, the grantee may apply for its renewal. Upon approval by the relevant local land bureau, a new contract is entered into to renew the grant, and a land premium shall be paid.

According to the “Notice of the Ministry of Land and Resources on Relevant Issues Concerning the Strengthening of Examination and Approval of Land Use in Urban Construction” (關於加強城市建設用地審查報批工作有關問題的通知) enacted by the Ministry of Land and Resources on September 4, 2003 (the “ Notice ”), from the day of promulgation, land use for luxurious commodity houses shall be stringently controlled, and applications for land use rights to build villas shall be stopped. On May 30, 2006, the Ministry of Land and Resources issued the “Urgent Notice of Further Strengthening the Administration of the Land” (關於當前進一步從嚴土地管理的緊急通知). It provided that: (i) land use shall not violate the overall land use plan and the annual land use plan and no entity or individual shall change or occupy basic agricultural land. Strict prohibitions shall be imposed on any illegal method to avoid the examination and approval procedures for occupation of basic agricultural land by, for example, amending the overall land use plan, and no one shall increase the use of construction land without authorization and approval; (ii) stricter examination and approval procedures shall be implemented with respect to the use of various non-agricultural construction land and strict limitations shall be imposed on the supply of land for projects that fall under restricted categories. No land preapproval, examination and approval, and land supply shall be granted for prohibited projects. Application and approval procedures must be undertaken in accordance with relevant laws for any non-agricultural construction using tidal-flat areas, barren hills or wasteland; and (iii) the Circular of the General Office of the State Council on Forwarding the Notice of the Ministry of Construction, the NDRC and the Ministry of Supervision on Adjusting the Housing Supply Structure and Stabilizing the Housing Price (Guo Ban Fa 2006 No. 37) (國務院辦公廳轉發建設部等部門關於調整住房供應結構穩定住房價格意見的通知(國辦發2006 37號)) shall be strictly implemented. This circular provides, among other things, that: (a) land used for real estate development must be granted through tender, auction or bidding-for-sale and the area of land shall be ascertained reasonably; (b) land supply priority shall be given to ordinary commodity houses at middle to low prices and in medium to small sizes (including affordable housing) and renting affordable housing. The land supply plan shall be known to the public; and (c) the land supply for low-density and large-sized housing shall be strictly controlled, and the rules on ceasing land supply for villa real estate development shall be resolutely implemented. From May 30, 2006, all land use supply and relevant procedures for villa projects shall cease and an overall rectification shall be carried out.

On December 12, 2006, the Ministry of Land and Resources and NDRC promulgated the Catalog of Restrictive Land Supply Items (2006 Version) and Catalog of Forbidden Land Supply Items (2006 Version) (限制用地項目目錄(2006本)和禁止用地項目目錄(2006本)). This catalog provides that, the new office buildings of

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the Chinese Communist Party and government agencies, large-scale commercial or entertainment establishments, racing fields, motor vehicle training fields, burial grounds, low-density and large-sized housing projects (referring to residential projects with a plot ratio of less than 1.0 and where the gross floor area for a single house exceeds 144 sq.m.) are listed in the restrictive land supply items, and villas, golf courses, racing courses, and new training centers of the Party and government agencies, State-owned enterprises and institutional agencies are classified as forbidden land supply items.

The Urban and Rural Planning Law of the People’s Republic of China (中華人民共和國城鄉規劃法) was implemented on January 1, 2008. This law provides, among other things, that if land use rights were obtained by way of allocation, the developer shall apply to the relevant urban and rural planning authorities for a site selection opinion before applying to other relevant authorities for approval or consent. This law also specifies that if the land use rights were obtained by way of allocation within the planning zones of cities or towns, the developer shall, before applying to the land administration authorities at or above the county level for land use rights, apply for the construction land planning permit from the relevant urban and rural planning authorities of that city or town after obtaining the approval or consent of other relevant authorities. Further, if land use rights were obtained by way of grant within the planning zones of cities or towns, relevant urban and rural planning authorities shall, prior to the granting of land use rights, specify the planning conditions such as the location, nature of use and permitted density of the development and integrate the planning conditions into the grant contract of the land use rights. Land without planning conditions can not be granted. After a grant contract of land use rights is executed, the developer needs to apply to urban and rural planning authorities of the city or county for the construction land planning permit along with the required documents. If a development is within the planning zones of a city or town, the developer needs to apply to urban and rural planning authorities of the particular city or county, or to the township government specified by the provincial level government for a planning permit for construction in a rural area. The development of projects must comply with the planning conditions and an application must be filed with the urban and rural planning authorities of the relevant city or county if any amendments to the planning conditions are necessary. Within six months of the completion of projects, a developer needs to file documents in respect of the inspection and assessment by government authorities of completed project with the urban and rural planning authorities.

Termination

In accordance with the Land Administrative Law of the People’s Republic of China (中華人民共國土地管理法) promulgated by the Standing Committee of the NPC on June 25, 1986 and amended on August 28, 2004, the land administrative authorities may recover state-owned land use rights with the approval of the governments that originally approved the land use rights, under any of the following cases:

to use the land for public interests (subject to proper compensation);
to use the land in re-building old city districts in order to implement urban construction plans (subject to proper compensation);
when the term of the land use rights expires, the holder has failed to apply for extension or failed to obtain approval for extension;
the use of the land originally allocated has been stopped due to cancellation or removal of units;
roads, railways, airports and mining sites that have been approved to be abandoned.

Under the Provisional Regulations on Grant and Transfer, the maximize term of the land use rights shall not exceed: (i) 70 years for residential purposes; (ii) 40 years for commercial, tourism and entertainment purposes; or (iii) 50 years for education, science, culture, public health, physical education, industrial, mixed-use or other purposes.

Land Transfers from Current Land Users

In addition to a direct grant from the government, an investor may also acquire land use rights from land users that have already obtained the land use rights by entering into an assignment contract or a joint-develop agreement with the land user.

The assignment contract or joint-develop agreement must be registered with the relevant local land bureau at the municipal or county level for land use rights title change purposes. Upon a transfer of land use rights, all rights and obligations contained in the land grant contract are deemed to be incorporated as part of the terms and conditions of such transfer.

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The assignment contract or the joint-develop agreement is subject to terms and conditions specified in the land grant contract. For residential construction projects, the Urban Real Estate Law requires that at least 25% of total construction costs, excluding land premiums, be expended and the construction schedule and date of completion and delivery of the project have been determined before assignment can take place. All rights and obligations of the current holder under a land grant contract will be transferred contemporaneously to the assignee of the land use rights. The relevant local government has the right to acquire the land use rights to be assigned if the assignment price is significantly lower than the market price. Relevant local governments may also acquire the land use rights from a land user in the event of a change in town planning. The land user will then be compensated for the loss of his land use rights.

Land Reserve and Primary Development

The Ministry of Finance, Land and Resources and the PBOC jointly promulgated the Measures for Land Reserve Administration (土地儲備管理辦法), which became effective as of November 19, 2007. Pursuant to the Measure, the land reserve institution refers to the independent legal entity which is affiliated to the local land administration bureau. The scope of the land reserve includes but is not limited to the land use rights resumed by the state, the land obtained subject to the pre-emptive right, the rural land which had been completed the reversion procedures and the land purchased by the land reserve institution. The land reserve institutions are permitted to carry out primary development of the reserved lands before supplying them to the market. Commercial banks could make mortgage loans to the land reserve institution after the land reserve institution has obtained approvals from the local financial department.

The Ministry of Finance and the Ministry of Land and Resources issued the Provisional Measures on Administration of Funds and Finance Affairs Relating to Land Reserve (土地儲備資金財務管理暫行辦法) on February 27, 2007, which regulate the matters concerning the capital required for, among other things, the early stage development of reserved land, including the source, scope of use and management of the such capital.

Mortgage and Guarantee

The mortgage of real estate in the PRC is governed by the Property Rights Law (物權法), Security Law of the PRC (中華人民共和國擔保法), or the Security Law, the Law of the PRC on the Administration of Urban Real Estate, or the Real Estate Law, the Regulation on Administration of Mortgages of Urban Real Estate (城市房地產抵押管理辦法), or the Real Estate Mortgage Regulation, and other relevant real estate related laws and regulations. When a mortgage is created over the ownership of a completed building, the same will be simultaneously created over the land use rights of the land where the building is erected. The mortgagee and the mortgagor shall enter into a mortgage contract in writing which becomes effective on the date of the registration of such mortgage by the relevant real estate authority. Pursuant to the Security Law, a real estate mortgage agreement shall contain specific provisions including (i) the type and amount of the indebtedness secured, (ii) the period of the obligation by the debtor, (iii) the repayment of the indebtedness, and (iv) the name, quantity, conditions, location, valuation and ownership of the mortgaged property. Pursuant to the Real Estate Law, buildings newly-erected on a piece of urban land after a mortgage contract has been entered into shall not be a mortgaged property. If the mortgaged property is auctioned off, the new buildings added on the land may be auctioned together with the mortgaged property, but the mortgagee shall not be entitled to priority compensation from the proceeds of the auction of the new buildings.

Pursuant to the Property Rights Law, a real estate mortgage becomes effective on the date of registration with the local real estate department. When carrying out mortgaged property registration, the loan contract and the mortgage contract as well as the land use rights certificate or the property ownership certificate in respect of the mortgaged property must be submitted to the registration authority. If the mortgagor cannot repay the loan that is secured by the mortgaged property, the mortgagee may agree with the mortgagor to receive payment by appraising the mortgaged property or through the proceeds of an auction or sale of the property. If no such agreement is reached, the mortgagee may institute proceedings in a People’s Court. After the mortgaged property has been appraised or been auctioned or sold, any portion of the proceeds that exceeds the amount of the indebtedness shall belong to the mortgagor and any shortfall shall be paid by the mortgagor.

The Security Law also contains comprehensive provisions dealing with guarantees. Under the Security Law, guarantees may be in two forms: (i) general guarantees whereby the guarantor bears the liability when the debtor fails to perform the payment obligation; and (ii) guarantees with joint and several liability whereby the guarantor and debtor are jointly and severally liable for the payment obligation. A guarantee contract must be in writing and, unless agreed otherwise, the guarantee shall remain valid for six months after the expiration of the term for performance of the principal obligation of the debtor.

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Idle Land

According to the Measures on Disposing Idle Land (閒置土地處置辦法) enacted and enforced by the Ministry of Land and Resources on April 28, 1999, the land can be defined as idle land under any of the following circumstances: (i) development and construction of the land is not commenced within the prescribed time limit after obtaining the land use rights without consent from the people’s government who approved the use of the land; (ii) where the “Contract on Paid Use of the Right to Use State-Owned Land” or the “Approval Letter on Land Used for Construction” has not prescribed the date of commencing the development and construction, the development and construction of the land is not commenced at the expiry of one year from the date when the “Contract on Paid Use of the Right to Use State-Owned Land” became effective or when the Ministry of Land and Resources issued the “Approval Letter on Land Used for Construction”; (iii) the development and construction of the land has been commenced but the area of the development and construction that has been commenced is less than one-third of the total area to be developed and constructed or the invested amount is less than 25% of the total amount of investment, and the development and construction have been continuously suspended for one year or more without an approval; or (iv) other circumstances prescribed by the laws and the administrative regulations.

On June 1, 2012, the Ministry of Land and Resources promulgated further Measures on the Disposal of Idle Land (閒置土地處置辦法) (“ further measures ”), which became effective on July 1, 2012. The Ministry of Land and Resources extended and clarified that the definition of idle land includes any land that became idle as a result of government related or non-government related acts. Government actions may cause land to become idle if (i) the government fails to deliver the land parcels to the grantee in accordance with the time limit specified under the relevant land grant contract or related documents, (ii) the grantee of the land use rights cannot develop the land in accordance with the contracted purposes due to recent land or urban planning adjustments, (iii) there are changes in the land or urban planning conditions due to modification of relevant national policies, and (iv) there are mass petitions, military control, protection of cultural relics, natural disaster and other related issues, which delay the development schedule of the land parcels.

The further measures require land use rights to be granted by the Ministry of Land and Resources to fulfill the following requirements: (i) the land use rights shall be free of encumbrances; (ii) original residents to be resettled (if any) must be compensated; (iii) there must be no legal or economic disputes in connection with the land use rights; and (iv) the relevant land parcels must have a clearly defined premise, nature of use, floor-area ratio and other land planning conditions.

The further measures provide clear procedures for investigation of idle land. Where the municipality or county-level land administrative department suspects the land to constitute idle land, it shall, within 30 days, commence investigation to confirm the status of the land, and issue an “Idle Land Investigation Notification Memorandum” (“ notification memorandum ”) to the grantee of the land use rights. The grantee of the land use rights shall, within 30 days of receiving the notification memorandum, provide materials outlining the state of affairs of the land development, reasons for the land being idle and other related explanatory materials to the abovementioned administrative department. The municipality or county-level land administrative department shall, after a piece of land which has been ascertained as idle land, notify the concerned land user and draft a proposal on methods of disposal of the idle land including but not limited to extending the time period for development and construction (provided that the extension shall be no longer than one year), changing the use of the land, arranging for temporary use, ascertaining a new land user by competitive bidding, public auction. The administrative department of land under the people’s government of city or county level shall, after the proposal on disposal has been approved by the original people’s government who approved the use of the land, arrange for implementation of the proposal.

With respect to any land parcel obtained under a land grant contract within the scope of city planning and becoming idle due to non-government related acts, if the work has not been commenced after one year from the prescribed date of commencement, a surcharge on idle land equivalent to no more than 20% of the land grant premium may be levied (such land grant premium cannot be listed as manufacturing cost for accounting purposes); if the work has not been commenced after two years from the prescribed date of commencement, the land can be confiscated without any compensation. However, the preceding stipulations shall not apply if the delay is caused by force majeure; acts of government or acts of other relevant departments under the government; or by the indispensable preliminary work. The further measures provide that, with respect to any land parcel becoming “idle” as a result of government-related acts, the grantee of the relevant land use rights shall explain to the municipality or county-level land administrative department the reasons for the land becoming idle, and consult the relevant government authority and rectify the situation accordingly

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(“ rectification procedures ”). The means of rectification include but are not limited to the extension of the period permitted for commencing development, the adjustment of the land use and planning requirements or the substitution of the relevant land parcels with other land parcels. To enhance control over land hoarding and land speculating activities, the further measures also require the Ministry of Land and Resources not to accept or process any application for title transfer transaction, lease transaction, mortgage transaction or land registration application in respect of the land use rights over any idle land parcel before the completion of the required rectification procedures. To strengthen the regulation of idle land, the further measures require that the Ministry of Land and Resources to copy the relevant finance authorities in all its communications about idling of government-owned land with the grantee of land use rights.

Property Development

Property development projects in the PRC are generally divided into single projects and large tract development projects. A single project refers to the construction of buildings on a plot of land and the subsequent sale of units. Large tract development projects consist of the comprehensive development of large area and the construction of necessary infrastructure such as water, electricity, road and communications facilities. The developer may either assign the land use rights of the developed area or construct buildings on the land itself and sell or lease the buildings erected on it.

Under the “Regulations on Administration of Development of Urban Real Estate (城市房地產開發經營管理條例) (the “ Development Regulations ”) promulgated by the State Council on July 20, 1998, an enterprise which is to engage in development of real estate shall satisfy certain requirements including (i) its registered capital shall be more than RMB1 million; and (ii) it has four or more full-time professional real estate/construction technicians and two or more full-time accounting officers, each of whom shall hold the relevant qualification certificate.

Where a foreign-invested enterprise is to be established to engage in development and sale of real estate, the relevant requirements of the laws and regulations regarding foreign-invested enterprises must also be observed and relevant approvals be obtained. The “Foreign Investment Industrial Guidance Catalog” was amended and promulgated by the Ministry of Commerce and the NDRC on December 24, 2011 and effective as of January 30, 2012, which provides, among other things, that the development of a whole land lot and construction of high-end hotels, premium office buildings, international conference centers by foreign-invested enterprises falls within the category of industry in which foreign investment is subject to restrictions, and the construction and operation of villas falls within the prohibited category, while other real estate development falls within the category of industries in which foreign investment is permitted. Moreover, real estate secondary market and estate agent or broker falls within the category of industry in which foreign investment is subject to restrictions. A foreign investor intending to engage in the development and sale of real estate may establish an equity joint venture, a cooperative joint venture or a wholly owned enterprise in accordance with relevant laws and regulations regarding foreign investment. Prior to its registration, the enterprise must be approved by the government authorities in charge of foreign investment, upon which an Approval Certificate for a Foreign Invested Enterprise will be issued.

The total investment amount and the category provided by the “Foreign Investment Industrial Guidance Catalog” determine the levels of the approval authorities. The existing laws and regulations impose a cap of a total investment of US$50 million on local approval for projects in the restricted category and a cap of a total investment of US$100 million on local approval for projects in the encouraged or permitted category. For those with a total investment exceeding US$50 million in the restricted category and projects with a total investment exceeding US$100 million in the encouraged or permitted category, the relevant approval authority shall submit the project documents to the Ministry of Commerce for approval.

Pursuant to the Urban Land Regulations, foreign entities may acquire land use rights in the PRC unless the law provides otherwise. However, in order to develop the acquired land, the foreign entities need to establish foreign investment enterprises in the PRC as the project companies.

These project companies may be in the form of Sino-foreign equity or cooperative joint ventures or wholly foreign-owned enterprises. The typical scope of business of such project companies includes development, construction, property management, and sales and leasing commodity properties and ancillary facilities on the specific land as approved by the government. The term of the property development company is usually the same as the term of grant of the land use rights in question.

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Establishment of a project company is subject to the approval by the relevant departments of the PRC government in accordance with the following procedure. First, the PRC party to a joint venture project or the foreign investor, in the case of a wholly foreign-owned project, will submit a project application report to the state or local development and reform commission for verification and approval. If the development and reform commission considers the proposed property development project to be consistent with the prevailing national and local economic plans and foreign investment regulations, it will grant an approval to the applicant in respect of the project. The NDRC and the Ministry of Commerce have been authorized to regularly promulgate guidelines for the direction of foreign investment.

Secondly, once the project application report has been verified and approved, the PRC party and the foreign investor may proceed to prepare a joint feasibility study report that reflects their assessment of the overall economic viability of the proposed project company. At the same time, the parties may proceed to negotiate and execute the joint venture contract and articles of association for the establishment of a project company. In the case of a wholly foreign-owned project, the foreign investor may then prepare and sign the articles of association. Thirdly, the joint feasibility study report, the joint venture contract and/or articles of association will then, depending, among other things, on the industry to which it belongs under the Catalog and the amount of total investment, be submitted to the Ministry of Commerce or its local counterpart, as the case may be, for approval. If the Ministry of Commerce or its local counterpart finds the application documents to be in compliance with PRC laws, it will issue an approval certificate for the establishment of the project company. With this approval certificate, the foreign investor and/or the PRC party can apply to the relevant branch of the Administration of Industry and Commerce for a foreign investment enterprise business license for the project company.

Once a foreign entity developer has established a project company and secured the land use rights to a piece of land for development, it has to apply for and obtain the requisite planning permits from the planning departments and have its design plan approved by, and apply for and obtain a construction work commencement permit from, the relevant construction commission for commencement of construction work on the land. When the construction work on the land is completed, the completed buildings and structures must be examined and approved by the government departments before they can be delivered to purchasers or lessors for occupancy.

Under the “Provisions on Administration of Qualification Certificates of Real Estate Developers” (房地產開發企業資質管理規定) (the “ Qualification Certificate Regulation ”) implemented by the Ministry of Construction on March 29, 2000, a real estate developer shall apply for its qualifications according to such Regulation. An enterprise may not engage in the development and sale of real estate without the qualification registration certificate. The construction authority under the State Council takes charge of supervising the qualifications of real estate developers throughout China, and the real estate development authority under a local government on or above the county-level shall supervise the qualifications of local real estate developers.

In accordance with the Qualification Certificate Regulation, real estate developers are classified into four classes. The approval system is tiered, so that confirmation of class 1 qualifications’ shall be subject to preliminary examination by the construction authority under the people’s government of the relevant province, autonomous region or municipality directly under the central government and then final approval of the construction authority under the State Council. Procedures for approval of developers of class 2, 3 or 4 shall be formulated by the construction authority under the people’s government of the relevant province, autonomous region or municipality directly under the central government. A developer that passes the qualification examination will be issued a qualification certificate of the relevant class by the authority.

Under the Qualification Certificate Regulation, the real estate development authorities shall examine applications for registration of qualifications of a real estate developer when it reports its establishment, by considering its assets, professional personnel and business results. A real estate developer shall only undertake real estate development projects in compliance with the approved qualification registration.

After a newly established real estate developer reports its establishment to the property development authority, the latter shall issue a provisional qualification certificate to the eligible developer within 30 days of its receipt of the above report. The real estate developer shall apply for a formal qualification certificate from the real estate development authority within one month before expiry of the provisional one. The provisional qualification certificate shall be effective for one year from the date of its issuance. The real estate development authority can extend the validity period for not more than two years after considering the actual business situation of the enterprise. Failure to obtain the required provisional or formal qualification certificate may result in a fine ranging from RMB50,000 to RMB100,000 and revocation of the developer’s business license if such failure to obtain the certificate is not rectified.

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A developer of any qualification classification may only engage in the development and sale of real estate within its approved scope of business and may not engage in business exceeding the scope permitted by its classification. A class 1 real estate developer is not restricted as to the scale of real estate project to be developed and may undertake a real estate development project anywhere in the country. A real estate developer of class 2, 3 or 4 may undertake a project with a gross area of less than 250,000 sq.m. and the specific scope of business shall be as confirmed by the construction authority under the people’s government of the relevant province, autonomous region or municipality.

The real estate development authorities perform annual inspections of qualified developers. Developers who fail to meet the qualification requirements or violate the relevant rules may have their qualification classification certificates degraded or revoked.

For the purpose of carrying out the construction and development of a real estate project, the real estate developers shall, after signing the land grant contract in accordance with the Regulations on Land Granting and Transfer and the Tender, Auction and Listing Regulations, attend certain procedures and obtain relevant approval documents in relation to the design, planning, construction and development of the land.

Planning and Construction Permits

Under the “Regulations on Planning Administration regarding Granting and Transfer of State-owned Land Use Rights in Urban Area” (城市國有土地使用權出讓規劃管理辦法) promulgated by the Ministry of Construction in December 1992, a real estate developer shall apply for a construction land planning permit (建設用地規劃許可證) from the municipal planning authority. After obtaining the construction land planning permit, the real estate developer shall then organize the necessary planning and design work in accordance with relevant planning and design requirements. A planning and design proposal in respect of the real estate project shall be submitted to the municipal planning authority following the requirements and procedures under the Urban and Rural Planning Law of the People’s Republic of China (中華人民共和國城鄉規劃法), which was issued on October 28, 2007, and a construction work planning permit (建設工程規劃許可證) must be obtained from the municipal planning authority.

On January 21, 2011, the State Council promulgated the Regulation on Expropriation and Compensation Related to Buildings on State-owned Land (國有土地上房屋徵收與補償條例), which replaces the Regulations for the Administration of Demolition and Removal of Urban Housing (城市房屋拆遷管理條例). The new regulation provides, among other things, that:

buildings can be expropriated under certain circumstances for public interests but only governmental authorities are permitted to conduct resettlement activities. Real estate developers are prohibited from involvement in the demolition and relocation procedures;
compensation shall be paid before the resettlement;
compensation to owners of properties to be demolished cannot be less than the market value of similar properties at the time of an expropriation. The market value of properties shall be determined by qualified real estate appraisal institutions in accordance with appraisal rules related to property expropriation. If any owner does not agree with the appraised market value of the property, he can apply to the real estate appraisal institution for re-appraisal; and
neither violence nor coercion may be used to force homeowners to leave. In addition, certain measures such as illegally cutting water and power supplies cannot be used in relocation work.

Sales/Pre-sales of Commodity Buildings

Commodity buildings can be sold before or after their completion. These sales are regulated and conducted in accordance with the provisions of the “Regulations for the Administration of Sale of Commodity Buildings (商品房銷售管理辦法), or the Sales Regulations promulgated by the Ministry of Construction in April 2001, the Measures for the Administration of Pre-sale of Commodity Buildings (城市商品房預售管理辦法), or the Pre-sales Measures amended by the Ministry of Construction in July 2004 and in accordance with the Development Regulations.

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For units of a commodity building sold before completion to occur under the Pre-sale Regulations, a developer must make the necessary pre-sale registration with the real estate development authority of the relevant city or county and obtain a pre-sale permit. A Pre-sale will take place if:

The premium in respect of the land use rights has been paid in full and the land use rights certificate has been obtained;
The construction work planning permit and the construction work commencement permit have been obtained;
At least 25% of the total amount of the project investment fund has been injected into the development of the project and the progress of construction and the expected completion date of the project has been ascertained; and
The pre-sale permit has been obtained.

Under the “Regulations for the Administration of Sale of Commodity Buildings” (商品房銷售管理辦法), commodity buildings may be put to post-completion sale only when the following preconditions have been satisfied: (a) the real estate development enterprise offering to sell the post-completion buildings shall have an enterprise legal person business license and a qualification certificate of a real estate developer; (b) the enterprise has obtained a land use rights certificate or other approval documents of land use; (c) the enterprise has the permit for construction project planning and the permit for construction; (d) the commodity buildings have been completed and been inspected and accepted as qualified; (e) the relocation of the original residents has been completed; (f) the supplementary essential facilities for supplying water, electricity, heating, gas, communication, etc. have been made ready for use, and other supplementary essential facilities and public facilities have been made ready for use, or the schedule of construction and delivery date of have been specified; (g) the property management plan has been completed. Before the post-completion sale of a commodity building, a real estate developer shall submit the real estate development project manual and other documents showing that the preconditions for post-completion sale have been fulfilled to the real estate development authority for making a record.

On July 6, 2006, the Ministry of Construction, the NDRC and the SAIC promulgated the Notice for the Further Rationalisation and Standardization of the Property Deal (關於進一步整頓規範房地產交易秩序的通知) (2006 No. 166), or the “166 Notice”. The 166 Notice aimed at perfecting a system of disclosure in order to regulate transactions conducted in the property market so as to prevent speculation. The 166 Notice contains, inter alia, the following measures that:

property developer shall commence the pre-sale within 10 days since the permission is obtained;
the resale of any unit of an pre-sold uncompleted commodity building be prohibited;
the advertisement of pre-sales prior to obtaining the relevant pre-sale permit be prohibited; and
standard forms for the sale and purchase of an unit of a commodity building before or after its completion be made available to a purchaser.

According to the Property Rights Law (中華人民共和國物權法) which was promulgated on March 16, 2007 and implemented on October 1, 2007, parties can apply for registration of a caveat by agreement in order to secure that they obtain future property rights. After registration of such caveat, without permission of the persons who enjoy such right of registration of the caveat, any disposal of the relevant real estate shall have no effect to the property rights.

Pursuant to the Notice on Promoting the Steady and Healthy Development of the Real Estate Market (關於促進房產地市場平穩健康發展的通知) issued by the General Office of the State Council on January 7, 2010, local governments must decide the minimize scale of pre-sales rationally and may not issue separate pre-sale permits by floor or unit.

On April 13, 2010, the MOHURD of People’s Republic of China issued the Notice on Further Strengthening the Supervision over the Real Estate Market and Improving the Pre-sale System of Commercial Housing (關於進一步加強房地產市場監管完善商品住房預售制度有關問題的通知). It provides that, among

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other things, within 10 days after the real estate developers obtain the pre-sale permit for the project for sale, they shall release the information regarding number of properties allowed for pre-sale under such pre-sale permission and the prices of such mentioned pre-sale units to the public in one time. They shall also sell the properties to the public at the price as published and strictly subject to the pre-sale permits.

On September 2, 2010, Shanghai Municipal Housing Support And Building Administration Bureau issued the Notice of Further Strengthening Municipal Supervision on Real Estate Market and Regulating Pre-sale Behaviors (上海市住房保障和房屋管理局關於進一步加強本市房地產市場監管規範商品住房預銷售行為的通知) (滬房管市2010 246號)). To thoroughly apply the “Notice on Further Strengthening the Supervision over the Real Estate Market and Improving the Pre-sale System of Commercial Housing” (關於進一步加強房地產市場監管完善商品住房預售制度有關問題的通知), it requires that (1) real estate project with a GFA less than 30,000 sq.m. shall apply for only one pre-sale permit; real estate project with a GFA more than 30,000 and where it is necessary to conduct pre-sale in stages, each pre-sale permit applied shall not cover less than 30,000 sq.m.; (2) real estate enterprise shall complete filings with relevant local authorities prior to pre-sale, setting out, among other things, the pre-sale price of each unit for sale; real estate enterprise shall submit amended filings with relevant local authorities if any particular unit is sold at a price higher than that stated in the relevant filings; (3) relevant authorities shall regulate the reservation and sales behaviors, and real estate developing enterprises shall not sign any commercial housing deposit contracts or commercial housing sales contracts unless they have obtained the Pre-sale Permit or have filed for sales of their existing houses.

On November 4, 2010, the MOHURD and the SAFE collectively promulgated the Notice on Further Regulating the Administration on House Purchase by Overseas Organization and Individual (關於進一步規範境外機構和個人購房管理的通知), which stipulates that, except as otherwise stated in laws and regulations, an overseas individual shall solely purchase one unit of owner-occupied residential house, and an overseas organization with a branch or representative office set up in the PRC shall solely purchase non-residential house necessary for business operations in the city where it is registered.

On March 16, 2011, the NDRC promulgated the Regulations on Sales of Commodity Houses at Expressly Marked Price (商品房銷售明碼標價規定) (“ the Regulation ”) with effect from May 1, 2011, which provide that real estate development enterprises and intermediary agencies (collectively, “ the Sellers and the Agencies ”) shall, during the period of selling new-built commodity houses, publish and mark the prices of the commodity houses and closely related factors thereof as well as the pricing standards. The Regulation stipulates that the Sellers and the Agencies shall mark the price of each commodity house with one price only. For real estate development projects that have obtained the pre-sale permits or are registered as finished houses, the Sellers and the Agencies shall publish the availability of all houses that are permitted to be sold and the price of each house within a specified time frame. The Sellers and the Agencies shall not sell the house at a price higher than the marked price and shall not collect charges not specified. Meanwhile, intermediary agencies shall sell second-hand commodity houses with reference to the Regulation. In the event that the Sellers and the Agencies do not expressly mark the price or publish their charges, or commit fraud through the marking of price or pricing artifices, local competent authorities of county-level or above shall have the right to penalize the Sellers and the Agencies accordingly.

Individual Housing Loans

“Circular on for the Determination of Second Residential Property in Individual Commercial Housing Loan Applications” (關於規範商業性個人住房貸款中第二套住房認定標準的通知) was jointly promulgated by MOHURD, PBOC and CBRC on May 26, 2010. The circular lays down the determining criteria of a property being identified as an individual’s second residential property in individual commercial housing loan applications. The circular provides that the number of residential properties owned by an individual loan applicant shall be determined with reference to the number of completed residential properties actually owned by the members of the family (including the individual loan applicant, their spouses and minor children) of the individual who plans purchase another residential property with the use of individual commercial housing loan. The application or authorization of any individual commercial housing loan by an individual borrower shall be subject to checks on the borrowers’ residential property registry records through the property registration information system and the issuance written results of such checks by the urban real estate authorities. The lender should implement a differential credit policy for the individual borrower’s second (or above) residential property in accordance with the number of residential properties owned by such borrowers. The policy in this circular is also applicable to non-residents who can provide local tax clearance certificates or local social insurance payment certificates for one year or above.

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“Circular on Regulations of Policies Concerning Individual Housing Provident Fund Loans” (關於規範住房公積金個人住房貸款政策有關問題的通知) was jointly promulgated by MOHURD, Ministry of Finance, PBOC and CBRC on November 2, 2010 and it lays down regulations in relation to the Individual Housing Provident Fund Loans. The circular provides that Individual Housing Provident Fund Loans could only be used to purchase, build, re-build and repair ordinary and privately used residential properties of laborers with the aim of meeting their basic need for housing. The making use of Individual Housing Provident Fund Loans to carry out speculative purchase of properties is strictly prohibited. To purchase the first residential property for private use with Individual Housing Provident Fund Loans, the down payment of the purchase shall not be less than 20% of the total purchase price if the gross floor area of the property is less than 90 meter squares (inclusive). If the gross floor area of the property is more than 90 meter squares, the down payment shall not be less than 30% of the total purchase price. For the purchase of the second residential property, Individual Housing Provident Fund Loans are only available to laborers whose families’ per-capita gross floor area is lower than the local average, and that could only be used to purchase ordinary and privately used residential properties that help improve the living condition of the laborers. The down payment for the purchase of the second residential property shall not be less than 50% of the total purchase price, and the interest rate of the loan shall not be less than 1.1 times of the interest rate for Individual Housing Provident Fund Loans in relation to the purchase of the first residential property during the same period. Individual Housing Provident Fund Loans are not available to laborers and their families for purchasing the third (or more) residential property.

Leasing

Both the Urban Land Regulations and the Real Estate Law permit the leasing of granted land-use rights and of the buildings or homes constructed on the land. On December 1, 2010 the Ministry of Construction promulgated the “Measures for Administration of Leases of Commodity Buildings” (商品房屋租賃管理辦法) (“ New Lease Measures ”), which took effect on February 1, 2011 and replaces the Measures for Administration of Leases of Buildings in Urban Areas (城市房屋租賃管理辦法). Pursuant to New Lease Measures, within 30 days after a lease contract is entered into, the parties thereto shall file with the local property administration authority. Any failure to comply with such filing requirement would lead to a fine. According to the Real Estate Law, rental income derived from the any building situated on allocated land, or land which the landlord has acquired only allocated land use rights, must be turned over to the State.

Insurance

There are no mandatory provisions in the PRC laws, regulations and government rules which require a real estate developer to take out insurance policies for its real estate projects.

According to the “Construction Law of the People’s Republic of China” (中華人民共和國建築法) promulgated by the Standing Committee of the National People’s Congress on November 1, 1997 and effective as of March 1, 1998, construction enterprises must take out accident and casualty insurance for workers engaged in occupationally hazardous operations and pay insurance premium. In the “Opinions of the Ministry of Construction on Strengthening the Insurance of Accidental Injury in the Construction Work” (建設部關於加強建築意外傷害保險工作的指導意見) by the Ministry of Construction on May 23, 2003, the Ministry of Construction further emphasizes the importance of the insurance of accidental injuries in the construction work and put forward the detailed opinions of guidance.

Real Estate Loans

Commercial Bank Loans

On June 5, 2003, the PBOC promulgated the Notice on Further Strengthening the Administration of Real Estate Related Credit (關於進一步加強房地產信貸業務管理的通知). According to this notice, commercial banks shall focus their business on supporting real estate projects targeted at mid-to lower-income households and appropriately restrict the granting of real estate loans to projects for the construction of luxury apartments and houses. The notice provides that when applying for bank loans, a real estate development company must contribute at least 30% of the total investment of the project from its own funds, and prohibits banks from advancing funds to real estate developers as working capital or for payment of land premiums. See “Recent macroeconomic control measures” below for recent developments in this area.

On August 30, 2004, the CBRC issued a Guideline for Commercial Banks on Risks of Real Estate Loans (商業銀行房地產貸款風險管理指引). According to the guideline, no loans shall be granted in relation to projects which have not obtained requisite land use rights certificates, construction land planning permits,

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construction works planning permits and construction work commencement permits. The guideline also stipulated that not less than 35% of the investment in a property development project must be funded by the real estate developer’s own capital for the project in order for banks to extend loans to the real estate developer. In addition, the guideline noted that commercial banks should set up strict approval systems on granting loans.

On March 16, 2005, the PBOC promulgated a Notice on Adjusting the Housing Loan Policy and Deposit Rate of Excess Reserves for Commercial Banks (關於調整商業銀行住房信貸政策和超額準備金存款利率的通知) which canceled the preferential mortgage lending interest rate for individuals and restricted on the minimize mortgage loan rate to 0.9 times the benchmark rate. The PBOC also increased the public housing fund loan rate (住房公積金貸款利率) by 0.18% and permitted commercial banks to decrease the mortgage loan rate from 80% to 70% of the value of the property if it is located in a city where property prices are increasing too rapidly.

On May 31, 2006, the PBOC promulgated a Notice about Relevant Matters on Adjusted Housing Credit Policies (關於調整住房信貸政策有關事宜的通知). The notice provides that, from June 1, 2006, the first installment payment for an individual house bought through a mortgage loan must not be lower than 30% of the purchase price. However, for houses purchased for self-residential purposes and with a gross floor area of less than 90 sq.m., the 20% first installment payment regulation still applies.

On September 27, 2007, PBOC and CBRC promulgated a “Circular on Strengthening the Management of Commercial Real-estate Credit Loans” (關於加強商業性房地產信貸管理的通知), which increases the down payment requirement applicable to a purchaser acquiring his second residential property to at least 40% and the interests payable on these loans must not be less than 110% of the benchmark interest rate of the same kind and same term by PBOC. Under this circular, the PRC authority has tightened control over commercial banks’ loans to property developers in order to prevent these banks from excessive credit granting. The circular emphasizes that commercial banks must not offer loans to property developers who have been found by state land and resource and construction authorities as hoarding land and buildings. Commercial banks are also prohibited from accepting commercial properties that have been vacant for more than three years as guaranties for loans. Under the complementary notice on Strengthening the Administration of Commercial Real Estate Credit Loans (關於加強商業性房地產信貸管理的補充通知), if a member of a family (including the purchaser, his/her spouse and their children under 18) has borrowed loans from banks to buy a house, any member of the family that buys another house will be regarded as a second-time home buyer.

On April 17, 2010, the State Council issued the Notice on Strictly Restraining the Excessive Growth of the Property Prices in Some Cities (國務院關於堅決遏制部分城市房價過快上漲的通知), according to which a stricter differential housing credit policy shall be enforced. It provides that, among other things, (1) for first-time family buyer (including the borrower, his/her spouse and his/her underage children, similarly hereinafter) of the apartment larger than 90 square meters, a minimize 30% down payment must be paid; (2) the down payment requirement on second-home mortgages was raised to at least 50% from 40% and also reiterated that an extra 10% should be adopted on interest rates for such buyers; and (3) for those who buy three or more houses, even higher requirements on both down payments and interest rates shall be levied. In addition, the banks can suspend housing loans to third or more home buyers in places where house prices rise too rapidly and too high and home supply is insufficient.

On October 7, 2010, Shanghai Municipal Government approved the Several Opinions on Further Strengthening the Control of Real Estate Market and Speeding up Housing-Security Programs of Shanghai (關於進一步加強本市房地產市場調控加快推進住房保障工作的若干意見), according to which:

(1) On the basis of the Notice on Strictly Restraining the Excessive Growth of the Property Prices in Some Cities (國務院關於堅決遏制部分城市房價過快上漲的通知), it further prohibited all commercial banks from making loans to the family buyers who buy three or more apartments in Shanghai.
(2) For the family who buy its first property with a GFA larger than 90 sq.m. and apply for housing fund loans, a minimize 30% of down payment is required, and the ceilings of the housing fund loan shall be RMB600,000; for the family who buy its second property for improving its living condition, a minimize 50% of down payment is required and the ceilings of the housing fund loan is RMB400,000; all the Housing Fund Management Centers shall suspend making loans to the family who apply for its second property, which could not be defined as a living-condition-improving property; the family who buy its three or more properties, the making of housing fund loans is prohibited.

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(3) Since the date that this Opinion being issued, any family (including both the husband and wife, and their underaged children) of Shanghai or other provinces can buy only one property in Shanghai.
(4) Land value appreciation tax shall be levied according to the ratio of the average price of house sold (A) by the company to the average price of all newly built house (B) in the whole area of last year: when A is lower than B, the land value appreciation tax shall be levied at the rate of 2%; when A does not exceed 2B, the tax rate shall be 3.5%; when A exceeds 2B, the tax rate shall be 5%.
(5) As to any real estate project which has obtained its Construction License after July 1, 2010, the requirements for it to apply for Pre-sale Permits shall be adjusted. The real estate project aforesaid can only apply for their pre-sale permits after its completion of capping main structure and passing the inspection.
(6) Relevant authorities are required to strengthen their managements on approval of planning, construction and pre-sale. Separately applying for limits of planning, construction and pre-sale are restricted. The scale of construction and pre-sale of a real estate project shall be no less than 30,000 sq.m. GFA. Real estate project with less than 30,000 sq.m. GFA is required to get Construction Planning Permit, Construction License and Pre-sale Permit at a single time.
(7) Real Estate Enterprises should strictly price its products according to the price it declared to relevant authorities. Whenever the actual price is higher than the declared one, it is required to file the new price to relevant authorities in timely fashion.

On September 29, 2010, the PBOC and the CBRC jointly issued the Notice on Relevant Issues Regarding the Improvement of Differential Mortgage Loan Policies (關於完善差別化住房信貸政策有關問題通知), which (i) raised the minimize down payment to 30% for all first home purchases with mortgage loans; (ii) required commercial banks in China to suspend mortgage loans to: (1) customers for their third or more residential property purchase, and (2) to non-local residents who cannot provide documentation certifying payment of local tax or social security for longer than a one-year period; and (iii) restricted the grant of new project bank loans or extension of credit facilities for all property companies with non-compliance records regarding, among other things, holding idle land, changing the land use to that outside the scope of the designated purpose, postponing construction commencement or completion, or hoarding properties.

Trust Financing

On October 1, 2001, “The Trust Law of the People’s Republic of China” (中華人民共和國信託法) (the “ Trust Law ”) came into effect. Trust Law regulates settlers, trustees, and beneficiaries that engage in civil, business or public welfare trust activities within the PRC. For purposes of the Trust Law, trust refers to that the settler, based on his faith in trustee, entrusts his property rights to the trustee and allows the trustee to, according to the will of the settler and in the name of the trustee, administer or dispose of such property in the interest of a beneficiary or for any intended purposes. The trust property shall be segregated from the property owned by the trustee. Where the trustee dies or the trustee as a body corporate is dissolved, removed or is declared bankrupt according to the applicable law, and the trusteeship is accordingly terminated, the trust property shall not be form part of his legacy or liquidation property.

A trust shall be created for lawful trust purposes and shall be made in written form. To create a trust, there must be definite property under the trust, and such property including the lawful property right must be the property lawfully owned by the settler. If laws or administrative regulations stipulate that registration shall be made for the creation of a type of trust, such registration shall be made accordingly, or the trust shall have no effect.

On March 1, 2007, “The Administration Measures on Trust Company” (信託公司管理辦法) came into effect. For the purposes of these measures, “trust financing company” shall have the meaning of a financial institution which was established pursuant to the PRC Company Law and these Measures and primarily engages in trust business; and the term “trust business” shall have the meaning of any business of a trust financing company through which it accepts a trust and handles trust affairs as a trustee and obtains remuneration. A trust financing company engaging in trust activities shall comply with laws, administrative regulations and the trust document and may not harm the interests of the State, the public or the legal rights and interests of third parties. To establish as a trust financing company, a financial institution shall be approved by the CBRC and shall obtain a financial business license. A trust financing company may apply to engage in cash trust, movable property

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trust, real estate property trust or any other business that regulated by laws and regulations or approved by the CBRC. Where a trust financing company manages or disposes of trust property, it must scrupulously carry out its responsibilities and perform its obligation of honest, trustworthy, prudent and efficient management. Meanwhile, trust property is not a part of the trust financing company’s own property and does not constitute a liability of the trust financing company towards the beneficiary. When a trust financing company is terminated by way of liquidation or dissolution, trust property shall not be a part of its property subject to liquidation.

On February 4, 2009, the amended “Measures for the Administration of Trust Companies’ Trust Plans of Assembled Funds” (信託公司集合資金信託計劃管理辦法) came into effect. This regulation is applicable to the set up trust plans of assembled funds (“ Trust Plan ”) in the PRC. Trust Plans must be set up according to relevant industry polices, laws and regulations, and shall has explicit investment target and strategy. For the purposes of this regulation, “Trust Plan” includes any trust activity that the trust financing company acts as a trustee, according to the will of the settler, administer or dispose settler’s property in the interest of a beneficiary. The property of Trust Plan is segregated from property owned by trust financing company. A trust financing company is prohibited to mix the property of a Trust Plan into its own property. In case where a trust financing company is dissolved, deregistered or declared bankrupt according to the law, the property of Trust Plan shall not form part of the liquidation property.

During the period of a Trust Plan, the trust financing company is required to select well-managed commercial bank as the custodian. The trust financing company is also required to establish specific departments and appoint specialized employees to manage the Trust Plan. Furthermore, the trust financing company may be required to disclose information of the Trust Plan in accordance with relevant laws and regulations.

From October 2008 to November 2010, the CBRC issued several regulatory notices in relation to real estate business conducted by trust financing companies, including a “Circular on Relevant Matters regarding Strengthening the Supervision of Real-estate and Securities Business of Trust Companies” (關於加強信託公司房地產、證券業務監管有關問題的通知), pursuant to which trust financing companies are restricted from providing trust loans, in form or in nature, to (i) property projects that have not obtained the requisite land use rights certificates, construction land planning permits, construction works planning permits and construction work commencement permits; (ii) property developers that had not been issued with Class 2 qualification certificates by the relevant competent construction authorities; (iii) property projects of which less than 35% of the total investments are funded by the property developers’ own capital (the percentage of 35% was changed to 20% for affordable housing and ordinary commodity apartments and 30% for other property projects as provided by a Notice on Adjusting the Capital Ratio of Fixed Assets Investment Project (國務院關於調整固定資產投資項目資本金比例的通知) issued by the State Council on May 25, 2009); and (iv) to property developers for payment of land premium or for working capital purposes.

Establishment of Real Estate Enterprises

In accordance with the regulations of Law of the People’s Republic of China on Urban Real Estate Administration (中華人民共和國城市房地產管理法) (revised on August 30, 2007), the real estate development enterprise is defined as the enterprises that engage in the real estate development and operation for the purpose of seeking profits. In accordance with the regulations of Administrative Regulations on Development and Operation of Urban Real Estate 9 (城市房地產開發經營管理條例) (Promulgated and implemented on July 20, 1998 by the State Council), establishment of a real estate development enterprise shall, in addition to the conditions for the enterprise establishment prescribed by relevant laws and administrative regulations, fulfill the following conditions:

The registered capital should be over RMB1 million, and
The enterprise shall have more than 4 full-time technical personnel with certificates of qualifications of real estate specialty and construction engineering specialty and more than 2 full-time accountants with certificates of qualifications.

People’s governments of the provinces, autonomous regions and municipalities directly under the Central Government may, in the light of the actual conditions prevailing in their respective localities, work out provisions for the conditions of registered capital and specialized technical personnel for the establishment of a real estate development enterprise higher than those in the preceding paragraph.

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Pursuant to the provisions of Rules for Implementation of Regulations on Administration of Qualifications of Real Estate Development Enterprises in Jiangsu Province (江蘇省實施房地產開發企業資質管理規定細則) promulgated and implemented on August 6, 2001 by Jiangsu Construction Department, the registered capital for establishment of real estate development enterprises should be no less than RMB4 million and should meet the requirements of relevant technical personnel.

In accordance with the Law of the People’s Republic of China on Urban Real Estate Administration (中華人民共和國城市房地產管理法), to establish a real estate development enterprise, a registration should be made with the Administration for Industry and Commerce. The Administration for Industry and Commerce shall handle registration procedures of those which comply with conditions as prescribed by this law and issue licenses to them; and refuse to handle registration procedures of those which do not comply with conditions prescribed by this law. Those which establish a limited liability company or limited stock company to engage in real estate development and operations shall also execute the relevant provisions of the Corporate Law. A real estate enterprise shall report for record to a department designated by the people’s government above county level where the registration department is located within one month after obtaining the license.

On May 25, 2009, the State Council issued a Notice on Adjusting the Capital Ratio of Fixed Assets Investment Project (國務院關於調整固定資產投資項目資本金比例的通知). The Notice provides that the minimize capital requirement for affordable housing and ordinary commodity apartments are 20%, and the minimize capital requirement for other real estate development projects is 30%. These regulations apply to both domestic and foreign investment projects.

Qualifications of Real Estate Development Enterprises

Classification and rating of qualifications of real estate development enterprises

In accordance with the relevant provisions of Administrative Regulations on Development and Operation of Urban Real Estate (城市房地產開發經營管理條例), A real estate development enterprise should, within 30 days starting from the date of obtainment of the business license, go to the competent department of real estate development of the locality wherein the registration organ is located for the record. The competent department of real estate development should, on the basis of the assets, specialized technical personnel and development and management achievements, verify the human quality grade of a real estate development enterprise put on record. The real estate development enterprise should, in accordance with the verified qualification grade, undertake corresponding real estate development projects.

On March 29, 2000, the Ministry of Construction promulgated the Regulations on Administration of Qualification of Real Estate Development Enterprises (房地產開發企業資質管理規定). Pursuant to the regulations, the enterprises engaged in real estate development should be approved in accordance with the provisions of application for the enterprise qualification level. Enterprises that fail to obtain certificates of real estate investments (hereinafter referred to as qualification certificates) shall not engage in the real estate development business.

Enterprises engaged in real estate development enterprises are classified into four qualification levels: Level I, Level II, Level III and Level IV in accordance with the enterprise conditions. The preliminary examination of the qualification of level I should be performed by the administrative departments of people’s governments of the provinces, autonomous regions and municipalities directly under the Central Government and then reported to the construction administrative departments of the state counsel for approval. The examination measures of the enterprises of level II qualification or lower should be developed by the construction administrative department of the people’s governments of the provinces, autonomous regions and municipalities directly under the Central Government. Those enterprises passing the qualification examination should be awarded with corresponding levels of qualification certificates by the qualification examination departments. The newly-established real estate enterprises should put a record in the competent department of real estate development within 30 days upon receipt of the business license. The competent department of real estate development should verify and issue the provisional qualification certificate (暫定資質證書) to the enterprises that conform to the conditions within 30 days upon receipt of the application for filing. The valid period of the provisional qualification certificate is one year. The competent department of real estate development may extend the valid period of the provisional qualification certificate depending on the actual conditions and the extension should not exceed two years. Enterprises engaged in real estate development shall apply for verification of qualification level to the competent department of real estate development one month before expiration of the valid period of the provisional qualification certificate.

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On August 6, 2001, Jiangsu Provincial Department of Construction promulgated Rules for Implementation of Regulations on Administration of Qualifications of Real Estate Development Enterprises in Jiangsu Province (江蘇省實施房地產開發企業資質管理規定細則). In accordance with the Rules, enterprises engaged in real estate development enterprises are classified into four qualification levels: Level I, Level II, Level III and Level IV in accordance with the enterprise conditions. The preliminary examination of the qualification of level I should be performed by the administrative departments of provincial people’s governments and then reported to the construction administrative departments of the state counsel for approval. The preliminary examination of qualification of levels II, III and III and temporary qualification should be conducted by the competent department of real estate development of the city with the districts and reported to the provincial construction administrative department for approval. Those enterprises passing the qualification examination should be awarded with corresponding levels of qualification certificates by the qualification examination department, which is produced by the construction administrative department of State Council. Those enterprises applying for provisional qualification certificate should possess the conditions not lower than level IV qualification.

Business scope of real estate development enterprises

Pursuant to the relevant provisions of Regulations on Administration of Qualifications of Real Estate Development Enterprises (房地產開發企業資質管理規定), enterprises of various qualification levels shall engage in the in real estate development and management within the prescribed business scope and shall not undertake tasks bypassing the levels. The level I qualification of real estate development enterprises can undertake the unrestricted construction scale of real estate construction across the country. The level II and lower levels of real estate development enterprises can undertake the development construction projects with the construction area less than 250,000 square meters. The specific range of business is determined by the competent construction administrative department of the people’s governments of provinces, autonomous regions and municipalities directly under Central Government.

Pursuant to the relevant provisions of Rules for Implementation of Regulations on Administration of Qualifications of Real Estate Development Enterprises in Jiangsu Province (江蘇省實施房地產開發企業資質管理規定細則), the level I qualification of real estate development enterprises can undertake the unrestricted construction scale of construction of real estate development projects across the country. The level II qualification of real estate development enterprises can undertake the development construction projects across the province with the construction area less than 250,000 square meters but no restriction on the number of floors. The level III qualification of real estate development enterprises can undertake the development construction projects within the provincially administered municipality with the construction area less than 150,000 square meters and no more than 16 floors (including) of buildings. The level IV qualification of real estate development enterprises are restricted to engage in the real estate development in the villages and towns beyond the urban planning area, which can undertake the development construction projects with the construction area less than 50,000 square meters and no more than 7 floors of buildings (including). The real estate development enterprises that obtain the Provisional qualification certificate may engage in the corresponding level of qualification of development construction projects according to the standards approved by following the Provisional qualification certificate.

Annual inspection of qualification of real estate development enterprises

Pursuant to the relevant provisions of Regulations on Administration of Qualifications of Real Estate Development Enterprises (房地產開發企業資質管理規定), an annual inspection system is implemented for the qualification of real estate development enterprises. For enterprises that do not conform to the original qualification conditions or have adverse operating acts, their qualification certificates should be downgraded or canceled by the original qualification approval department. The annual inspection of qualification of level I qualification of real estate development enterprises should be under the charge of competent construction administrative department of State Council or its authorized authority. For the annual inspection of level II or below qualifications of real estate development enterprises, the competent construction administrative department of the provinces, autonomous regions and municipalities directly under the central government shall develop the administrative measures.

Pursuant to the relevant provisions of Rules for Implementation of Regulations on Administration of Qualifications of Real Estate Development Enterprises in Jiangsu Province (江蘇省實施房地產開發企業資質管理規定細則), an annual inspection system is implemented for the qualification of real estate development enterprises. The annual inspection of the qualification of real estate development enterprises shall follow the Measures for the Administration of Annual Inspection of Qualifications of Urban Real Estate Development Enterprises of Jiangsu Province (江蘇省城市房地產開發企業資質年檢管理辦法).

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Foreign Investment in Property Development

On July 11, 2006, the Ministry of Construction, MOFCOM, NDRC, PBOC, SAIC and SAFE jointly issued the Options on Regulating the Entry and Administration of Foreign Investment into the Real Estate Market (關於規範房地產市場外資進入和管理的意見) (the “ 171 document ”). The 171 document provides that: (i) foreign organizations and individuals who have established FIEs are allowed to invest and purchase non-self-resided real estate in China; branches of foreign organizations established in China and foreign individuals who work or study in China for over a year are eligible to purchase commercial houses which match their real needs for self-utilization or self-residence under their real names; (ii) the registered capital of foreign-invested real estate corporations with total investments of more than US$10 million shall be no less than 50% of its total investment; (iii) foreign-invested real estate corporations can apply for the FIE approval certificate (外商投資企業批准證書) and business license (營業執照) only after they have paid back all the land premium and obtained the State-owned land use rights certificate; (iv) foreign investors shall pay off all the transfer price in a lump sum with their own funds if they acquire Chinese domestic real estate corporations; (v) no offshore or Chinese domestic loan is allowed and the foreign exchange administration shall not approve the conversion of foreign loans into RMB if the foreign-invested real estate corporations have not contributed their registered capital in full, or have not obtained the State-owned land use rights certificate, or their capital for a development project is less than 35% of the total investment; and (vi) by no means can Chinese or foreign investors make any commitment in any documents to guarantee a fixed return or fixed revenue in disguised form for any party in the contract.

On August 14, 2006, Commerce Department of PRC promulgated the Notification on Relevant Issues on Implementing “Opinions on Regulating Foreign Capital Admittance and Management in the Property Market” (商務部辦公廳關於貫徹落實關於規範房地產市場外資准入和管理的意見有關問題的通知). According to this Notification, foreign-capital-invested property enterprises with total investment exceeding or equal to US$10 million or between US$3 million and US$10 million shall have its registered capital no less than 50% of the total investment while no less than 70% hereof when total investment less than or equal to US$3 million. Foreign investors that merge domestic property enterprises through stock equity transfer and other means shall appropriately arrange staff members and deal with banking debts and pay off all transfer payment in a lump sum with its owned funds within three months since the issuing date of foreign-investment enterprise business license. Foreign investors that merge stock equity of the Chinese side in foreign-invested property enterprises shall appropriately arrange staff and deal with banking debts and pay off all considerations for transfer in a lump sum with its owned funds within three months since the issuing date of foreign-investment enterprise business license.

MOFCOM and SAFE jointly issued a Notice on Further Strengthening and Regulating the Approval and Administration regarding Foreign Direct Investment in the Real Estate Industry (關於進一步加強、規範外商直接投資房地產業審批和監管的通知) (“ No. 50 Notice ”) on May 23, 2007. Under the Notice, local commercial authorities should reinforce the approval and supervision process over foreign-invested real estate enterprises, and strictly control foreign fund from investing in high-end real estate development projects. For foreigninvested company intending to engage in the property development business, the land use rights should be obtained, or at least has entered into pre-contract purchase agreement with the relevant land administrative authorities, land developers, or the owners of the house or other constructions, otherwise the proposed foreign-invested real estate company will not be approved by the authorities. For existing foreign-invested company who intends to expand its operations in its business operation or company who intends to engage in the operation or development of the new real estate project, they should undertake relevant procedures with the approval authority.

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On June 18, 2008, MOFCOM issued the Notice Regarding the Registration for Foreign-Funded Real Estate Industry (商務部關於做好外商投資房地產業備案工作的通知) (“ Circular 23 ”), requiring that registration filings be preliminarily examined by the provincial branch of MOFCOM before submitting to MOFCOM for registration. Pursuant to Circular 23, MOFCOM may select approximately five to ten registered foreign-invested real estate enterprises as samples for test examinations in each quarter, and for any enterprise which is found to have failed to comply with current regulations, MOFCOM may inform SAFE and request their foreign currency registration and status be canceled.

In December 2010, MOFCOM promulgated the Notice on Strengthening Administration of the Approval and Registration of Foreign Investment into Real Estate Industry (關於加強外商投資房地產業審批備案管理的通知), which provides that, among other things, in the case where a real estate enterprise is established within the PRC with overseas capital, it is prohibited from purchasing and/or selling real estate properties completed or under construction within the PRC for arbitrage purposes. The local MOFCOM authorities are not permitted to approve investment companies to engage in real estate development and management.

On December 24, 2011, MOFCOM and the NDRC jointly issued a revised Foreign Investment Industrial Guidance Catalog (外商投資產業指導目錄), which took effect on January 30, 2012 and provides, among other things, that the development and construction of high-end hotels, high-end office buildings and international convention centers by foreign invested enterprises is restricted. The construction and operation of villas by foreign invested enterprises is also prohibited. The real estate enterprises with foreign investment can be established in the forms of Sino-foreign joint ventures, Chinese foreign cooperative ventures or wholly foreign-owned enterprises. Prior to the establishment of registration, enterprises are required to be approved by the competent commerce department and obtain the Certificate of approval for establishment of enterprises with foreign investment.

In April 2013, SAFE issued the Administrative Measures for Registration of Foreign Debt (外債登記管理辦法) (匯發[2013]19號) and Guidelines on the Administration of Registration of Foreign Debt (外債登記管理操作指引), which provide that (inter alia) (i) SAFE will not process a foreign debt registration of any foreign invested real estate enterprise which obtained its certificate of authorization and completed the filing procedures with MOFCOM on or after June 1, 2007; (ii) foreign invested real estate enterprises established prior to June 1, 2007 may borrow foreign debt up to an amount not exceeding the difference between its total investment and registered capital; and (iii) a foreign invested real estate enterprise that has not fully paid up its registered capital or obtained land use rights certificates, or whose paid-in capital for its development projects is less than 35% of the total investment of such projects, are not allowed to borrow foreign debt.

On May 10, 2013, SAFE issued the Notice on the Foreign Exchange Administration of Domestic Direct Investment of Foreign Investors and the Supporting Documents (國家外匯管理局關於印發外國投資者境內直接投資外匯管理規定及配套文件的通知) (匯發[2013]21號), effective as of May 13, 2013. This notice abolishes 24 previous regulations, and further simplifies and clarifies the Regulation of Foreign Exchange of Domestic Direct Investment by Foreign Investors.

Property Service Enterprises

Foreign-invested Property Service Enterprises

Pursuant to the provisions of Catalogs of Industries, the services of property management fall into such categories permitted foreign investment. Foreign-invested property service enterprises can be establish med in the forms of in the forms of Sino-foreign joint venture, Chinese foreign cooperative venture or wholly foreign-owned Prior to the establishment of registration, enterprises shall be approved by Competent Commerce Department and obtain certificate of approval (外商投資企業批准證書) for establishment of enterprises with foreign investment issued thereof.

Qualifications for Property Service Enterprises

Enterprises that engage in property management shall implement Qualifications Management System pursuant to relevant state regulations in Property Management Regulations (物業管理條例) (executed on September 1, 2003 and revised on August 26, 2007). Pursuant to relevant regulations in Measures on Property Service Enterprises Qualifications Management (物業服務企業資質管理辦法) (executed on May 1, 2004 and revised on November 26, 2007), newly-established property service enterprises shall submit such following files to competent departments in charge of property of the municipalities directly under the central government and

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People’s Government of cities with districts where commercial registrations are conducted for application for qualifications within 30 days on receiving trading certificates. Qualifications examination and legal organs shall audit and issue the qualifications certificate of corresponding levels pursuant to Actual conditions of enterprises.

In accordance with the Measures on Administration of Qualification of Property Service Enterprises (物業服務企業資質管理辦法), qualifications of property service enterprises fall into first level, second level and third level. The competent construction department of the State Council is responsible for issuing and managing of the first-level qualification certificates for first -level of property service enterprises. Competent construction departments under provincial and autonomous regional People’s Governments are responsible for issuing and managing of the second-level qualification certificates, while competent real estate construction departments under People’s Government of municipalities directly under the central government are responsible for issuing and managing of second and third level qualification certificates thereof, which are subject to the guidance and supervision of competent construction departments of State Council. The competent real estate construction departments of the cities with districts are responsible for the issuing and management of the third level qualification certificates, which are subject to the guidance and supervision of competent construction departments of State Council.

Property service enterprises of first-level qualification shall undertake various property management projects. Property service enterprises of second-level qualification shall undertake property management of residence project less than 300 thousand square meters and non-residence projects less than 80 thousand square meters. Property service enterprises of third-level qualification shall undertake property management of residence projects less than 200 thousand square meters and non-residence projects less than 50 thousand square meters. The annual check system is implemented for property service enterprises.

Recruitment of Property Service Enterprises

In accordance with the relevant regulations of Real Right Law (物權法) and Property Management Regulations (物業管理條例), to select and to recruit property service enterprises should be agreed by exceeding half of the total owners and such owners who shall have construction gross area exceeding half of the gross area of constructions. Prior to recruiting property service enterprises by owner and owner conference, if the construction units select the property services enterprises, a written pre-phase property management contract should be signed.

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DIRECTORS AND SENIOR MANAGEMENT

The Board is responsible for and has general powers over the management and conduct of our business. The table below shows certain information in respect of members of our Board.

Name	Age	Position

Wang Zhenhua. . . . . . .	52	Chairman, Executive Director and Chief Executive Officer
Min Yuansong . . . . . . .	39	Executive Director
Liu Yuanman . . . . . . . .	56	Executive Director
Huang Maoli . . . . . . . .	39	Executive Director
Lv Xiaoping . . . . . . . .	52	Non-Executive Director
Wang Xiaosong . . . . . .	26	Non-Executive Director
Chen Huakang . . . . . . .	61	Independent Non-Executive Director
Nie Meisheng . . . . . . .	73	Independent Non-Executive Director
Zhu Zengjin. . . . . . . . .	50	Independent Non-Executive Director

Executive Directors

Wang Zhenhua (王振華) , or Chairman Wang, aged 52, is our chairman, executive director and chief executive officer. Chairman Wang began engaging in property development business in China in 1993 when he joined Wujin Xincheng Investment and Construction Development Co., Ltd. (武進市新城投資建設開發公司) and participated in the development of Zhong Liang Town Phase 1 (中涼城第1期), and gained valuable experience in construction and project management. Chairman Wang founded the business of our Group and has been the chairman of the board of directors of Future Land Holdings since 1996. In 2001, Chairman Wang became chairman of the board of directors of Jiangsu Future Land, a subsidiary of our Group that engages principally in residential property development and the B-shares of which are listed on the Shanghai Stock Exchange (Stock code: 900950). In 2008, Chairman Wang founded Future Land Wanbo, which focuses on the development of mixed-use complex project. Chairman Wang graduated from Jiangsu Broadcast and Television University (江蘇廣播電視大學) with a diploma in mechanical engineering in August 1983, and from Cheung Kong Graduate School of Business (長江商學院) with an EMBA degree in July 2005. Chairman Wang currently serves as an executive committee member of the All-China Federation of Industry and Commerce (中華全國工商業聯合會), and as a vice-president of China Real Estate Chamber of Commerce (中華全國工商業聯合會房地產商會). In 2010, Chairman Wang was named “National Model Worker” by the State Council.

Min Yuansong (閔遠松) , aged 39, is our executive director. Mr. Min joined our Group in 2000. Between 2001 and 2004, he served as assistant president of Jiangsu Future Land, where he was responsible for marketing in its Wujing branch. Between 2004 and 2007, Mr. Min served as vice president of Jiangsu Future Land, where he was responsible for project development of the Future Land Southern Metropolis project, and gained valuable experience in project management. Between May 2007 and June 2010, Mr. Min was appointed as a director and the vice president of Jiangsu Future Land (Stock code: 900950), where he was responsible for marketing. Since June 2010, Mr. Min has been a director and vice president of Future Land Holdings, overseeing our mixed-use complex development business principally carried out by Future Land Wanbo. Mr. Min graduated from Wuhan University (武漢大學) with a bachelor’s degree in science in 1997 and a master’s degree in economics in 2000. Mr. Min qualified as a Senior Economist (高級經濟師) in 2004. Mr. Min graduated from China Europe International Business School with a Master of Business Administration degree in 2007.

Liu Yuanman (劉源滿) , aged 56, is our executive director and head of the strategic investment center. Mr. Liu joined our Group in 2006 and was appointed as a vice president of Future Land Wanbo in 2010 and vice president of Future Land Holdings in 2011. Mr. Liu is responsible for the engineering and construction of our Group’s mixed-use complexes. Mr. Liu graduated from Changzhou Construction Vocational University (常州市建築職工大學) with a diploma in industrial and civil engineering in May 1984. Prior to joining our Group, Mr. Liu worked in Changzhou Marine Products Co., Ltd. (常州市水產公司) between 1984 and 1995 and served as general manager and chairman of Changxin Real Estate Development Co., Ltd. (常信房地產開發有限公司) between 1995 and 2002 and general manager of Wuxi Jintaihu Real Estate Limited Company (無鍚金太湖房地產開發有限公司) between 2003 and 2006, where he was responsible for the overall business of the company and gained valuable experience in project management. Mr. Liu qualified as a civil engineer in 2000.

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Huang Maoli (黃茂莉) , aged 39, is our executive Director, a member of the remuneration committee (the “Remuneration Committee”) and joint company secretary (the “Joint Company Secretary”) of the Company. Madam Huang joined the Company in December 2011. Madam Huang is primarily responsible for investor relation and overseas financing activities of the Company, while overseeing the strategic development and internal audit and management work of the Company. Madam Huang graduated from Nanjing University (南京大學) with a bachelor’s degree in economics in 1994 and a master’s degree in economics in 1997. Madam Huang obtained an MBA degree from the Wharton School of Business at the University of Pennsylvania in 2003. Prior to joining the Group, Madam Huang held various positions at Goldman Sachs GaoHua Securities Limited (高盛高華證券有限責任公司) between May 2007 and December 2011, and served as executive director of its investment banking division immediately before joining the Company. Previously, Madam Huang served as a vice president of Bank of America Corporation strategic planning and corporate development department between August 2005 and April 2007.

Non-Executive Director

Lv Xiaoping (呂小平) , aged 51, is our non-executive director. Mr. Lv joined our Group in 2001. Mr. Lv served as the vice president of Future Land Holdings between September 2001 and August 2004. From August 2004 to January 2013, Mr. Lv was a director and the president of Jiangsu Future Land (Stock code: 900950), principally responsible for the overall management of its residential property development business. Since February 2013, Mr. Lv has been the vice chairman of Jiangsu Future Land. Mr. Lv graduated from Naval University of Engineering with a bachelor’s degree in engineering in 1983. Mr. Lv graduated from China European International Business School with an MBA degree in 2007. Prior to joining our Group, Mr. Lv worked in Changchai Company Limited, a company listed on the Shenzhen Stock Exchange (Stock code: 000570) between 1987 and 2001 and served as the secretary to the board of directors and head of investment, where he was responsible for business development and investment strategies.

Wang Xiaosong (王曉松) , aged 26, is our non-executive Director. Mr. Wang is the son of Chairman Wang, executive Director, chief executive officer and controlling shareholder of the Company. Mr. Wang joined Jiangsu Future Land (Stock code 900950) in 2009 as civil engineer and subsequently as project manager. Between November 2011 and January 2013, Mr. Wang became the vice president and general manager of the marketing department of Jiangsu Future Land where he was responsible for and gained valuable experience in sales and market research. In February 2013, Mr. Wang was appointed as president of Jiangsu Future Land, and has been responsible for its general management. In addition, since April 2013, Mr. Wang has been a director of Jiangsu Future Land. Mr. Wang graduated from Nanjing University (南京大學) with a bachelor’s degree in Environmental Sciences in 2009.

Independent Non-Executive Directors

Chen Huakang (陳華康) , aged 61, is our independent non-executive director. Mr. Chen joined our Group in November 2012. Mr. Chen was awarded a certificate in Modern Economic Management Professional Studies (現代經濟管理專業學習) by Beijing Economic Management College (北京經濟管理函授學院) in 1988. Mr. Chen has been a certified public accountant in China since 1998 and a registered expert consultant in Jiangsu province (江蘇省註冊諮詢專家) since 2004. Mr. Chen has over 40 years of experience in the field of accounting. Mr. Chen worked in the Accounting Department of County Community Enterprise (社隊企事業) between 1972 and 1981, and became the head of the finance department in Anjiaxiang District (安家鄉), Wujin County (武進縣) between 1981 and 1987. Between 1987 and 1995, Mr. Chen served as head of the finance department of Xinqiao District (新橋區), Wujin County. Mr. Chen is and has been serving as the principal accountant and managing partner of Jiangsu Wujin Certified Public Accountants (江蘇武晉會計師事務所), a registered PRC accounting firm in Jiangsu province, since 1995. Mr. Chen also served as managing partner of Wujin Assets Valuation Association (武進資產評估事務所) between 1995 and 2000, and is and has been the president of Changzhou Jieling Investment Management Consultant Limited (常州傑靈建設投資管理諮詢有限公司) since 2004. Mr. Chen served as independent director of Jiangsu Future Land (Stock code: 900950) between May 2002 and May 2010 and the independent director of Jiangsu Shunfeng Photovoltaic Co., Ltd. (江蘇順風光電科技有限公司) between 2009 and May 2012.

Nie Meisheng (聶梅生) , aged 73, is our independent non-executive director. Madam Nie first joined our Group when she was appointed as an independent director of Jiangsu Future Land between 2007 and 2009. She joined us again in November 2012 as independent non-executive director. Madam Nie graduated from Tsinghua University (清華大學) with civil engineering in 1963, specializing in hydraulic engineering. Madam Nie served as independent non-executive director of three companies listed on the Stock Exchange including Neo-China

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Land Group (Holdings) Limited (中新地產集團(控股)有限公司) (Stock Code: 563), Powerlong Real Estate Holdings Limited (寶龍地產控股有限公司) (Stock Code: 1238) and Road King Infrastructure Limited (路勁基建有限公司) (Stock Code: 1098) since October 2003 (up to her resignation in July 2010), September 2009 and October 2012, respectively. Madam Nie also served as independent director of Jiangsu Future Land between 2007 and 2010. In September 2006, Madam Nie was elected as a fellow of the World Academy of Productivity Science by World Confederation of Productivity Science. From July 2006 to June 2009, Madam Nie served as a visiting professor in Shanghai University. Madam Nie was elected as the deputy chairlady for the first committee of China Urban and Town Water Supply and Sewage Association in March 2007. Madam Nie is currently the economic counselor of the people’s government of Jieyang (揭陽), Guangdong Province and her appointment commenced in December 2006 and chairlady of China Real Estate Chamber of Commerce (中華全國工商業聯合會房地產商會) in 2004.

Zhu Zengjin (朱增進) , aged 50, is our independent non-executive director. Mr. Zhu joined our Group in November 2012. Mr. Zhu graduated from Nanjing University (南京大學) with a bachelor’s degree in law in 1985 and from Beijing University (北京大學) with an EMBA degree in 2005. Mr. Zhu was designated as a visiting scholar in law to New York University (紐約大學) in the United States between 1998 and 1999. Mr. Zhu was the head of the business department between July 1985 and August 1998 and the deputy head and partner between August 1999 and August 2009 of Jiangsu C&T Partners Law Firm (江蘇世紀同仁律師事務所) respectively. Mr. Zhu was also a listing committee member of the GEM Board of the China Securities Regulatory Commission (中國證監會創業板發審委委員) between August 2009 and August 2011. Since January 2002, Mr. Zhu has been a committee member of the Jiangsu Province All China Lawyers Association in Securities Law (江蘇省全國律師協會公司證券法委員會委員) and has been recognized as a Well Known Lawyer in Jiangsu Province (江蘇知名律師) by the association. Mr. Zhu has served as an independent director of two listed companies in the PRC, namely Ningbo Yunsheng Co., Ltd. (寧波韻升股份有限公司) (Stock Code: 600366) and Bank of Nanjing Co., Ltd (南京銀行股份有限公司) (Stock Code: 601009), since March 2012 and June 2012, respectively, and three other non-listed PRC companies, namely, Guolian Trust Co., Ltd (國聯信託股份有限公司), Institute of Architectural Design Co., Ltd (蘇州設計院股份有限公司) and Jiangnan Rural Commercial Bank Co., Ltd (江南農村商業銀行) since June 2008, September 2009 and June 2012, respectively.

Senior Management

Lu Zhongming (陸忠明) , aged 42, is our chief financial officer, overseeing the accounting and finance functions of our Group. Mr. Lu joined our Group in 2001 after Jiangsu Future Land acquired its listing status on the Shanghai Stock Exchange and became the finance general manager of Jiangsu Future Land in 2002. Mr. Lu has been a director of Jiangsu Future Land and a vice president of Future Land Wanbo since 2010. Mr. Lu became vice president of Future Land Holdings in 2011. Mr. Lu completed his accounting study from Nanjing Institute of Finance & Economics (南京財經學院) in 1999. Prior to joining our Group, Mr. Lu served as deputy head of finance and audit department of Jiangsu Wuling (acquired by Future Land Holdings in our B-Share Restructuring in 2001) between 1998 and 2001.

Qi Boming (戚伯明) , aged 61, is the vice president of Future Land Holdings and the head of the human resources and administration center and the IT center. Mr. Qi joined our Group in 2002. Mr. Qi was the vice president of Jiangsu Future Land (Stock code: 900950) between August 2002 and May 2007, and a director between 2003 and 2010. Mr. Qi has been a vice president and a director of Future Land Holdings since May 2007 and July 2010, respectively, and has been overseeing our Group’s general administration and information management. Mr. Qi graduated from Xi’an Military Institute (西安陸軍學校) in political studies in 1979. Prior to joining our Group, Mr. Qi was a government official and worked in a number of government authorities in Wujin (武進), Jiangsu Province between 1982 and 2002, including serving as head of the Health Bureau of Wujing between 1999 and 2002.

Xu Guoping (徐國平) , aged 57, is the vice president and a director of Jiangsu Future Land responsible for the construction and engineering of residential property development. Mr. Xu has been working in our group for over 15 years, and during this period he has gained extensive experience in construction, engineering and project management. Mr. Xu joined our Group in 1996. Between 1996 and 2001, Mr. Xu served as vice general manager of Jiangsu Future Land, responsible for project management in Wujin area. Since 2001, Mr. Xu has served as vice president and director of Jiangsu Future Land. Between 2001 and 2004, he was responsible for the development of several residential property projects in Changzhou. From 2004 to the present time, Mr. Xu has been responsible for engineering, cost management and procurement. Prior to joining our Group, Mr. Xu worked at Wujin Process Design Institute (武進工藝美術廠) between 1974 and 1995, and served as head of the institute between 1993 and 1995, where he was responsible for the overall business and operation, and gained valuable experience in management.

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Shao Lei (邵磊) , aged 43, is the vice president of Jiangsu Future Land responsible for the design and technical support for our residential property development business. Mr. Shao joined our Group in 2005 and became the general manger of our technical research institute in 2007. Mr. Shao graduated from Southeast University (東南大學) with a bachelor’s degree in architecture in 1994 and qualified as a registered state-level architect (2001 年國家一級註冊建築師) in 2001. Prior to joining our Group, Mr. Shao worked at Changzhou Urban Planning Design Institute (常州市規劃設計院) between 1994 and 2005, and served as head of the institute from 2001 and 2005 responsible for overall business management and gained valuable experience in construction and management.

Qi Xiaoming (戚小明) , aged 45, is the assistant president of Jiangsu Future Land. He joined our Group in 2002 and has assumed various positions within our Group. Mr. Qi is also the general manager of Changzhou Future Land. Mr. Qi graduated from Hefei University of Technology (合肥工業大學) with a bachelor’s degree in engineering in 1992. Between 1992 and 2001, Mr. Qi held various senior management positions in Changzhou Passenger Trucks Manufacturing Plant (常州客車製造廠), including vice office manager responsible for general office affairs. Mr. Qi served as office manager of Wujing Branch of Pingan Insurance (Group) Limited Company of China (中國平安保險公司武進公司) between 2001 and 2002.

Joint Company Secretaries

Ms. Huang Maoli is one of our joint company secretaries. See the paragraph headed “– Executive Director” for his biography.

Ms. Mok Ming Wai (莫明慧) , aged 43, is a director of KCS Hong Kong Limited, an external corporate secretarial and accounting services provider in Hong Kong. She has over 15 years of professional and in-house experience in the field of company secretarial services. Prior to joining KCS Hong Kong Limited, Ms. Mok worked in the Corporate Services Division of KPMG Hong Kong and acted as the company secretary for two companies listed on the Main Board of the Stock Exchange. She is a fellow member of the Hong Kong Institute of Chartered Secretaries and the Institute of Chartered Secretaries and Administrators in the United Kingdom.

Board Committee

Audit Committee

Our audit committee consists of three independent non-executive directors including Mr. Chen Huakang, Mr. Zhu Zengjin and Madam Nie Meisheng. The audit committee is chaired by Mr. Chen. The primary duties of the audit committee is to assist the Board in providing an independent view of the effectiveness of our financial reporting process, internal control and risk management system, oversee the audit process and perform other duties and responsibilities as assigned by the Board.

Remuneration Committee

Our remuneration committee consists of three members, namely Madam Huang Maoli, our executive director, and Mr. Zhu Zengjin and Madam Nie Meisheng, our independent non-executive directors. Two of the committee members are our independent non-executive directors. The remuneration committee is chaired by Mr. Zhu. The primary duties of the remuneration committee include:

making recommendations to our directors on our policy and structure for all remuneration of directors and senior management and on the establishment of a formal and transparent procedure for developing policies on such remuneration;
determining the terms of the specific remuneration package of our directors and senior management;
reviewing and approving performance-based remuneration by reference to corporate goals and objectives resolved by our directors from time to time; and
considering and approving the grant of share options to eligible participants.

– 180 –

Nomination Committee

Our nomination committee consists of three members, namely Mr. Min Yuansong, our executive director, and Mr. Zhu Zengjin and Madam Nie Meisheng, our independent non-executive directors. The chairman of the nomination committee is Mr. Zhu. The primary function of the nomination committee is to make recommendations to our Board to fill board vacancies.

Compensation of Directors and Senior Management

Our executive directors receive, in their capacity as our employees, compensation in the form of salaries, bonus and other allowances and benefits in kind, including our contribution to the pension scheme for our executive directors, in their capacity as employees, according to the law of the relevant jurisdiction.

The aggregate amount of remuneration (including fees, salaries, performance related bonus, retirement scheme contributions and pre-IPO share award scheme) paid to our directors for the years ended December 31, 2011, 2012 and 2013 was approximately RMB13.0 million, RMB18.5 million and RMB31.0 million, respectively.

The aggregate amount of remuneration (including basic salaries, housing allowances, pre-IPO share award scheme, other allowances and benefits in kind) paid to our five highest paid individuals for the years ended December 31, 2011, 2012 and 2013 was approximately RMB13.7 million, RMB18.5 million and RMB26.5 million, respectively.

In the three years ended December 31, 2013, we did not pay any remuneration to our directors or the five highest paid individuals as an inducement to join or upon joining us or as a compensation for loss of office. No director has waived or has agreed to waive any emoluments during the same year.

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PRINCIPAL SHAREHOLDERS

The following table sets forth information regarding beneficial ownership of our Shares as of June 30, 2014 by those persons who beneficially own more than 5% of our outstanding shares and underlying shares, as recorded in the register maintained by us pursuant to Part XV of the SFO.

			Approximate
		Number of	percentage of
Name	Capacity/Nature of interest	Shares	shareholding

Chairman Wang(1) . . . . . . . . . . . . . . . .	Founder of a discretionary	4,099,068,000	72.32%
	trust
Standard Chartered Trust	Trustee	4,099,068,000	72.32%
(Singapore) Limited(1) . . . . . . . . . .
SCTS Capital Pte. Ltd.(1) . . . . . . . . . .	Nominee	4,099,068,000	72.32%
Infinity Fortune Development	Interest in a controlled	4,099,068,000	72.32%
Limited(1) . . . . . . . . . . . . . . . . . . . .	corporation
First Priority Group Limited(1) . . . . .	Interest in a controlled	4,099,068,000	72.32%
	corporation
Wealth Zone Hong Kong
Investments Limited(2) . . . . . . . . . .	Beneficial owner	4,099,068,000	72.32%

(1) Standard Chartered Trust (Singapore) Limited, as trustee of the Hua Sheng Trust, was established by Chairman Wang in favor of his family members. Standard Chartered Trust (Singapore) Limited indirectly held 100% of the interests in Infinity Fortune Development Limited through its nominee SCTS Capital Pte. Ltd., which in turn held 100% of the interests in First Priority Group Limited.

(2) Wealth Zone Hong Kong Investments Limited is wholly owned by First Priority Group Limited.

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RELATED PARTY TRANSACTIONS

The following discussion describes certain material related party transactions between our consolidated subsidiaries and our directors, executive officers and substantial shareholders and, in each case, the companies with whom they are affiliated.

As a listed company on the Hong Kong Stock Exchange, we are subject to the requirements of Chapter 14A of the Listing Rules which require certain “connected transactions” with “connected persons” be approved by a company’s independent shareholders. Each of our related party transactions disclosed hereunder that constitutes a connected transaction within the meaning of the Listing Rules requiring shareholder approval has been so approved, or otherwise exempted from compliance under Chapter 14A of the Listing Rules.

The following table sets forth certain material transactions between us and our related parties for the years indicated:

	Year ended December	Year ended December	Year ended December	31,

	2011	2012		2013

	(RMB)	(RMB)		(RMB)
		(in thousands)
Transactions with related parties
Disposal of equity interest to a related party
– Jiangsu Future Land Shiye Group Ltd . . . . . . . . .	500		–	–
Transfer of liabilities
– Jiangsu Future Land Shiye Group Ltd . . . . . . . . .	–	44,000		–
Fundings from related parties
– Shanghai Wan Zhi Cheng . . . . . . . . . . . . . . . . . . . .	–		–	230,000
Fundings to related parties
– Shanghai Wan Zhi Cheng . . . . . . . . . . . . . . . . . . . .	572,367		–	–
– Shanghai Xincheng Xudi Real Estate Co., Ltd . . .	–		–	362,565
	572,367		–	362,565

Borrowings guaranteed by a related party
– Mr. Wang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	901,500		–	–
Sales of services
– Shanghai Wan Zhi Cheng . . . . . . . . . . . . . . . . . . . .	–		–	3,240
Gain from transaction with non-controlling
interests
– Mr. Wang and Mr. Wang Xiaosong . . . . . . . . . . . .	–		–	246,942
Key management compensation
Salaries and other short-term employee benefits . . .	20,866	36,597		45,263
Post-employment benefits . . . . . . . . . . . . . . . . . . . . .	34	48		–
	20,900	36,645		45,263

Office Tenancy Agreements with Mr. Wang Xiaosong

In 2010 and 2011, we entered into six tenancy agreements with Mr. Wang Xiaosong (the son of Chairman Wang and our non-executive director), pursuant to which Mr. Wang Xiaosong leased certain office premises with an aggregate GFA of 720 sq.m. to us for nil consideration. Each tenancy agreement is for a period of 20 years. In the three years end December 31, 2013, we did not pay any rent to Mr. Wang Xiaosong for the use of the office premises covered by these tenancy agreements.

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RELATIONSHIP WITH JIANGSU FUTURE LAND

Jiangsu Future Land is a subsidiary of our Company currently listed on the Shanghai Stock Exchange. Jiangsu Future Land contributed RMB9,222.2 million, RMB14,300.4 million and RMB16,584.0 million to our total revenue for the years ended December 31, 2011, 2012 and 2013, respectively, which represented 85.7%, 81.6% and 79.8% of our total revenue for the same years, respectively. As of the date of this offering memorandum, 58.86% of Jiangsu Future Land was held by Future Land Holdings, our subsidiary and 41.14% by other shareholders. As a company listed on the Shanghai Stock Exchange, Jiangsu Future Land is required to observe certain corporate governance rules and conduct its operations independently of its controlling shareholder. Applicable PRC rules and regulations also require the controlling shareholders of a listed company to refrain from (i) abusing its relationship with the listed company in a manner that would harm the listed company’s interests and (ii) engaging in competition with the listed company.

In light of such non-competition requirements, we have separated our residential property development operations (by Jiangsu Future Land) from our mixed-use complex development operations (by our other subsidiaries) within our Group. Jiangsu Future Land and Future Land Holdings entered into a non-competition confirmation agreement (the “ Non-Compete Confirmation ”) on April 26, 2010, which contains the following key provisions:

Jiangsu Future Land and its subsidiaries (together, the “ B-Share Group ”) will only engage in the development and operation of projects of which 70% or more of the total GFA is designated for residential use (excluding hotels) and less than 100,000 sq.m. of the total GFA is designated for commercial use (including financial, wholesale and retail use, offices, serviced apartments and hotels).
Future Land Holdings and its subsidiaries other than those in the B-Share Group (together, the “ Non B-Share Group ”) shall only engage in the development and operation of projects of which (i) more than 30% of the total GFA is designated for commercial use, (ii) 100,000 sq.m. or more of the total GFA is designated for commercial use, or (iii) any other property development projects that do not fall within the aforesaid parameters of residential projects.
Each of Jiangsu Future Land and Future Land Holdings may, subject to their respective corporate governance policies, voluntarily waive their respective development rights under the Non-Compete Confirmation and (i) engage in cooperation to jointly develop any property project or (ii) undertake any property project which the other party has voluntarily waived its rights of development.
The B-Share Group and the Non B-Share Group may continue to develop and operate existing projects (including projects under development and projects for future development) that had already been undertaken by each of them, respectively, prior to the date of the Non-Compete Confirmation.

Similarly, to ensure the board of directors of Jiangsu Future Land is able to perform its duties owed to Jiangsu Future Land independently, Chairman Wang and Mr. Lv Xiaoping (a non-executive director of our Company) will abstain from voting and they will not be counted in the quorum in any meeting of the board of Jiangsu Future Land involving matters or transactions with the Non-B Share Group.

The articles of association of Jiangsu Future Land require that important decisions that may materially affect the interests of the B-shareholders of Jiangsu Future Land as a whole, including but not limited to, any decision to issue new securities, undergo material restructuring of assets, acquire substantial assets, procure overseas listing of material subsidiaries or repurchase shares from shareholders as repayment of any loan extended to such shareholders, require approval of the independent directors and/or the shareholders of Jiangsu Future Land who are independent from the Non-B Share Group.

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DESCRIPTION OF MATERIAL INDEBTEDNESS AND OTHER OBLIGATIONS

To fund our existing property projects and to finance our working capital requirements, we have entered into financing agreements with various financial institutions, including banks and registered trust financing companies. Set forth below is a summary of the material terms and conditions of these loans and other indebtedness.

Project and Working Capital Loan Agreements in PRC

Certain of our PRC subsidiaries have entered into loan agreements with various PRC banks, including Bank of China, The Agricultural Bank of China, China Construction Bank and Industrial and Commercial Bank of China. These loans are typically secured project or secured working capital loans to finance the construction of our projects and have terms ranging from six months to five years, which generally correspond to the construction periods of the particular projects. As of December 31, 2013, the aggregate outstanding amount of our bank borrowings totaled approximately RMB11,222.5 million (US$1,853.8 million), of which RMB4,043.5 million was due between one and two years and RMB4,264.5 million was due between two and five years. Since December 31, 2013, we have settled the outstanding balance of RMB2,267.9 million bank borrowings and had additional bank borrowings in the amount of RMB3,122.0 million, up to May 31, 2014. Our project and working capital loans are typically secured by land use rights, properties and/or equity interests held by the PRC subsidiary borrowers and/or our other PRC subsidiaries. The Notes, the Subsidiary Guarantees and JV Subsidiary Guarantees (if any) will be structurally subordinated to these loans and any other indebtedness incurred by our PRC Subsidiaries.

Interest

We have both floating rate and fixed rate project and working capital loans. The principal amounts outstanding under the floating rate borrowings generally bear interest at floating rates calculated by reference to the relevant bank’s benchmark interest rate per annum. Floating interest rates generally are subject to review by the lending banks annually. Interest payments are payable either monthly or quarterly and must be made on each payment date as provided in the particular loan agreement. As of December 31, 2013, the weighted average effective interest rate on our bank borrowings was 6.85% per annum. Interest rates on our fixed rate borrowings under our project and working capital loan agreement range from 1.6% to 8.2% per annum as of the date of this offering memorandum.

Covenants

Under these project and working capital loans, many of our subsidiary borrowers have agreed, among other things, not to take the following actions without first obtaining the relevant lenders’ prior consent:

create encumbrances on any part of their property or assets or deal with their assets in a way that may adversely affect their ability to repay their loans;
grant guarantees to any third parties that may adversely affect their ability to repay their loans;
sell or dispose of assets;
incurring other material indebtedness;
make any major changes to their corporate structures, such as entering into joint ventures, mergers and acquisitions and reorganizations or making other changes to the company’s status, such as liquidation or dissolution; and
alter the nature or scope of their business operations in any material respect.

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Dividend Restrictions

Pursuant to the project and working capital loan agreements, some of our PRC subsidiaries have agreed not to distribute any dividends (or agreed to give notice to the relevant banks before any distribution of dividends):

if the borrowers’ after-tax net profit is nil or negative or insufficient to cover losses from the previous accounting periods; or
if the borrower’s profit before tax in the relevant accounting period has not been used to pay off the principal, interest or other related expenses due in that accounting period or is insufficient to cover the principal, interest or other related expenses due in next period; or
before the principal amount of and accrued interest on the relevant loans have been fully paid.

We do not believe that the dividend restrictions in such loans will materially and adversely affect our ability to service the repayment obligations under our debt instruments, as most of these loans are required to be repaid when the underlying property projects are completed, and as such, by the time units in the projects are ready for sale, the dividend restrictions should no longer exist.

Events of Default

The project and working capital loans contain certain customary events of default, including insolvency and breaches of the terms of the loan agreements. The banks generally are entitled to terminate their respective agreements and/or demand immediate repayment of the loans and any accrued interest upon the occurrence of an event of default.

Guarantee and Security

Certain of our PRC subsidiaries have entered into guarantee agreements with the PRC banks in connection with some of the project loans pursuant to which these subsidiaries have guaranteed all liabilities of the subsidiary borrowers under these project and working capital loans. Further, as of December 31, 2013, most of the project and working capital loans were secured by land use rights, properties and/or equity interests held by the PRC subsidiary borrowers and/or our other PRC subsidiaries.

Bank of China 2013 Revolving Loan Facility

On June 25, 2013, two of our wholly owned subsidiaries incorporated in Hong Kong, Hong Kong Achieve Development Limited and Hong Kong Prosperity Development Limited, (the “ Borrowers ”), entered into a facility letter with Bank of China (Hong Kong) Limited (“ BOC ”) for a HK$2,375.0 million revolving loan facility. As of the date of this offering memorandum, an aggregate of approximately RMB200.1 million is outstanding under this revolving loan facility.

Interest

The principal amount outstanding under the revolving loan facility bears interest at LIBOR plus a margin of 1.4% for U.S. dollars and at HIBOR plus a margin of 1.4% for Hong Kong dollars.

Security

Hong Kong Prosperity Development Limited has created a change over its deposit in the amount of not less than HK$2,375.0 million, together with interest accrued on or to be accrued thereon. If the charged deposit is denominated in any foreign currency, BOC may charge extra deposit margin as determined by BOC from time to time.

Events of Default

The revolving loan facility contains certain customary events of default, including non-payment and breaches of the terms of the revolving loan facility. BOC is entitled to demand immediate repayment of outstanding amount under loan upon the occurrence of an event of default.

– 186 –

Trust Financing Arrangements

In January 2014, we entered into two trust financing arrangements with Jiangsu International Trust Corporation Limited to obtain trust loans in total principal amount of approximately RMB539.3 million[1] for two projects, Suzhou Fragrant Legend (蘇州香溢瀾橋) and Changzhou Future Success (香溢俊園). Jiangsu Future Land provided guarantees for the two trust loans. As of December 31, 2013, we do not have any outstanding trust financing arrangements.

Repayment of Our Existing Trust Financing Arrangements

The term of our outstanding trust financing arrangements is from January 3, 2014 to December 13, 2014. We have normally discharged our repayment obligations under our trust financing arrangements using proceeds from sales and pre-sales of our properties.

Types of Trust Financing Arrangements

Trust financing arrangements are available in the PRC in various forms. We have entered into the following types of trust financing arrangement:

Type (i) arrangements: trust loans in which the equity interests in, or the land use rights held by, our borrowing PRC subsidiary are pledged to the trust financing company (as trustee of the respective trust fund) as security for the trust loans.

Type (ii) arrangements: trust loans in which equity interests in our borrowing PRC subsidiary are acquired by the trust financing company (as trustee of the respective trust fund) through capital injection and/or equity transfer, with an option given to us, or an undertaking given by us, to repurchase the respective equity interests at the expiry of the term of the funding arrangement.

The trust financing companies with whom we have entered into trust financing arrangements are independent third parties.

Customer Guarantees

In line with industry practice, we also provide guarantees to mortgagee banks in respect of mortgage loans taken out by purchasers of our properties. Such guarantee obligations typically terminate upon the delivery of the relevant property ownership certificates on the underlying property to the bank. As of December 31, 2013, the aggregate outstanding amount guaranteed was RMB2,980.7 million (US$492.4 million).

The January 2018 Notes

On January 31, 2013, we entered into an indenture (as amended and supplemented from time to time, the “ January 2018 Indenture ”) pursuant to which we issued 10.25% Senior Notes due 2018 in an aggregate principal amount of US$200.0 million.

Guarantee

The obligations pursuant to the January 2018 Notes are guaranteed by the Subsidiary Guarantors specified in the January 2018 Indenture. Under certain circumstances and subject to certain conditions, a guarantee by a Subsidiary Guarantor may be replaced by a limited-recourse guarantee, referred to as a JV Subsidiary Guarantee in the January 2018 Indenture. Each of the Subsidiary Guarantors, jointly and severally, guarantees the due and punctual payment of the principal, any premium, and interest on, and all other amounts payable under, the January 2018 Notes.

1 We have RMB125.0 million on deposit with Jiangsu International Trust Corporation Limited which can be used to set off the outstanding amount of such trust loans.

– 187 –

Collateral

In order to secure the obligations under the January 2018 Notes, the Company under the January 2018 Indenture pledged the capital stock of all such Subsidiary Guarantors owned by the Company for the benefit of the holders of the January 2018 Notes. The Collateral may be released or reduced in the event of certain asset sales and certain other circumstances. The holders of the Notes will be entitled to share in the benefit of such pledge of Capital Stock on a pari passu basis with the holders of the January 2018 Notes and any holders of other Permitted Pari Passu Secured Indebtedness.

Interest

The January 2018 Notes bear an interest rate of 10.25% per annum. Interest is payable semi-annually in arrears on January 31 and July 31 of each year, as commenced on July 31, 2013.

Covenants

Subject to certain conditions and exceptions, the January 2018 Indenture contains certain covenants, restricting us and each of the related restricted subsidiaries from, among other things:

incurring or guaranteeing additional indebtedness and issuing disqualified or preferred stock;
declaring dividends on its capital stock or purchasing or redeeming capital stock;
making investments or other specified restricted payments;
entering into agreements that restrict the related restricted subsidiaries’ ability to pay dividends, transfer assets or make intercompany loans;
issuing or selling capital stock of the related restricted subsidiaries;
guaranteeing indebtedness of the related restricted subsidiaries;
selling assets;
creating liens;
entering into sale and leaseback transactions;
entering into transactions with shareholders or affiliates; and
effecting a consolidation or merger.

Events of Default

The January 2018 Indenture contains certain customary events of default, including default in the payment of principal, or of any premium, on the January 2018 Notes, when such payments become due, default in the payment of interest which continues for 30 days, breaches of covenants, insolvency and other events of default specified in the January 2018 Indenture. If an event of default occurs and is continuing, the trustee under the January 2018 Indenture or the holders of at least 25% of the outstanding January 2018 Notes may declare the principal of the January 2018 Notes plus any accrued and unpaid interest and premium (if any) to be immediately due and payable.

Change of Control

Upon the occurrence of a certain event of change of control and a rating decline, we are obligated to make an offer to repurchase all outstanding January 2018 Notes at a purchase price equal to 101% of their principal amount plus any accrued and unpaid interest.

– 188 –

Maturity and Redemption

The maturity date of the January 2018 Notes is January 31, 2018. At any time on or after January 31, 2016, we may redeem the January 2018 Notes, in whole or in part, at a redemption price equal to the percentage of principal amount set forth in the table below if redeemed during the 12-month period beginning on January 31 of the years indicated below, plus any accrued and unpaid interest to the redemption date:

Period	Redemption	Price

2016	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	105.1250%
2017	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	102.5625%

At any time prior to January 31, 2016, we may redeem the January 2018 Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of the January 2018 Notes, plus a premium and any accrued and unpaid interest to the redemption date.

At any time prior to January 31, 2016, we may redeem up to 35.0% of the aggregate principal amount of the January 2018 Notes at a redemption price equal to 110.25% of the principal amount of the January 2018 Notes, plus any accrued and unpaid interest to the redemption date with the proceeds from sales of certain kinds of our capital stock, subject to certain conditions.

Additionally, if we or a subsidiary guarantor under the January 2018 Indenture would become obligated to pay certain additional amounts as a result of certain changes in specified tax law, we may redeem the January 2018 Notes at a redemption price equal to 100.0% of the principal amount of the January 2018 Notes, plus any accrued and unpaid interest, subject to certain exceptions.

The April 2016 Notes

On April 23, 2014, we entered into an indenture (as amended and supplemented from time to time, the “ April 2016 Indenture ”) pursuant to which we issued 9.75% Senior Notes due 2016 in an aggregate principal amount of CNY1,500 million.

Guarantee

The obligations pursuant to the April 2016 Notes are guaranteed by the Subsidiary Guarantors specified in the April 2016 Indenture. Under certain circumstances and subject to certain conditions, a guarantee by a Subsidiary Guarantor may be replaced by a limited-recourse guarantee, referred to as a JV Subsidiary Guarantee in the April 2016 Indenture. Each of the Subsidiary Guarantors, jointly and severally, guarantees the due and punctual payment of the principal, any premium, and interest on, and all other amounts payable under, the April 2016 Notes.

Collateral

The Company has pledged the Capital Stock of the Subsidiary Guarantors owned by the Company (subject to Permitted Liens and the Intercreditor Agreement) in order to secure the obligations of the Company under the January 2018 Notes and the January 2018 Indenture. On April 23, 2013, the Company, the Trustee, the Collateral Agent and the trustee of the January 2018 Notes (the “ January 2018 Notes Trustee ”) entered into the Intercreditor Agreement pursuant to which the holders of the April 2016 Notes are entitled to share in the benefit of such pledge of Capital Stock on a pari passu basis with the holders of the January 2018 Notes and any holders of other Permitted Pari Passu Secured Indebtedness.

Interest

The April 2016 Notes bear an interest rate of 9.75% per annum. Interest is payable semi-annually in arrears on April 23 and October 23 of each year, as commenced on October 23, 2013.

– 189 –

Covenants

Subject to certain conditions and exceptions, the April 2016 Indenture contains certain covenants, restricting us and each of the related restricted subsidiaries from, among other things:

incurring or guaranteeing additional indebtedness and issuing disqualified or preferred stock;
declaring dividends on its capital stock or purchasing or redeeming capital stock;
making investments or other specified restricted payments;
entering into agreements that restrict the related restricted subsidiaries’ ability to pay dividends, transfer assets or make intercompany loans;
issuing or selling capital stock of the related restricted subsidiaries;
guaranteeing indebtedness of the related restricted subsidiaries;
selling assets;
creating liens;
entering into sale and leaseback transactions;
entering into transactions with shareholders or affiliates; and
effecting a consolidation or merger.

Events of Default

The April 2016 Indenture contains certain customary events of default, including default in the payment of principal, or of any premium, on the April 2016 Notes, when such payments become due, default in the payment of interest which continues for 30 days, breaches of covenants, insolvency and other events of default specified in the April 2016 Indenture. If an event of default occurs and is continuing, the trustee under the April 2016 Indenture or the holders of at least 25% of the outstanding April 2016 Notes may declare the principal of the April 2016 Notes plus any accrued and unpaid interest and premium (if any) to be immediately due and payable.

Change of Control

Upon the occurrence of a certain event of change of control and a rating decline, we are obligated to make an offer to repurchase all outstanding April 2016 Notes at a purchase price equal to 101% of their principal amount plus any accrued and unpaid interest.

Maturity and Redemption

The maturity date of the April 2016 Notes is April 23, 2016.

The Company may at its option redeem the Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of the April 2016 Notes plus a premium as of, and accrued and unpaid interest, if any, to (but not including) the redemption date.

The Company will give not less than 30 days’ nor more than 60 days’ notice of any redemption.

– 190 –

DESCRIPTION OF THE NOTES

For purposes of this “Description of the Notes,” the term “Company” refers only to Future Land Development Holdings Limited, and any successor obligor on the Notes, and not to any of its subsidiaries. Each Subsidiary of the Company which guarantees the Notes is referred to as a “Subsidiary Guarantor,” and each such guarantee is referred to as a “Subsidiary Guarantee.” Each Subsidiary of the Company that in the future provides a JV Subsidiary Guarantee (as defined below) is referred to as a “JV Subsidiary Guarantor.”

The Notes are to be issued under an indenture (the “Indenture”), to be dated as of the Original Issue Date, among the Company, the Subsidiary Guarantors, as guarantors, and The Bank of New York Mellon, London Branch, as trustee (the “Trustee”) and as Collateral Agent.

The following is a summary of certain provisions of the Indenture, the Notes, the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Intercreditor Agreement. This summary does not purport to be complete and is qualified in its entirety by reference to all of the provisions of the Indenture, the Notes, the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Intercreditor Agreement. It does not restate those agreements in their entirety. Whenever particular sections or defined terms of the Indenture not otherwise defined herein are referred to, such sections or defined terms are incorporated herein by reference.

Copies of the Indenture will be available on or after the Original Issue Date at the corporate trust office of the Trustee at 40th Floor, One Canada Square, London E14 5AL, United Kingdom.

Brief Description of the Notes

The Notes are:

general obligations of the Company;
senior in right of payment to any existing and future obligations of the Company expressly subordinated in right of payment to the Notes;
at least pari passu in right of payment with the January 2018 Notes, the April 2016 Notes and all other unsecured, unsubordinated Indebtedness of the Company (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law);
guaranteed by the Subsidiary Guarantors on a senior basis, subject to the limitations described below under the caption “– The Subsidiary Guarantees” and in “Risk Factors – Risks Relating to the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Collateral”;
effectively subordinated to the other secured obligations (if any) of the Company, the Subsidiary Guarantors and the JV Subsidiary Guarantors, to the extent of the value of the assets serving as security therefor; and
effectively subordinated to all existing and future obligations of the Non-Guarantor Subsidiaries (as defined below).

In addition, on the Original Issue Date, subject to the limitations described in “Risk Factors – Risks Relating to the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Collateral,” the Notes will be secured by a pledge of the Collateral as described below under the caption “– Security” and will:

be entitled to the benefit of a lien on the Collateral (subject to any Permitted Liens and the Intercreditor Agreement (as defined below) and shared on a pari passu basis with (i) holders of the January 2018 Notes, (ii) holders of the April 2016 Notes and (iii) any holders of other Permitted Pari Passu Secured Indebtedness, if any); and
rank effectively senior in right of payment to unsecured obligations of the Company with respect to the value of the Collateral pledged by the Company securing the Notes (subject to any priority rights of such unsecured obligations pursuant to applicable law).

The Notes will mature on July 21, 2019, unless earlier redeemed pursuant to the terms thereof and the Indenture.

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The Notes will bear interest at 10.25% per annum from the Original Issue Date or from the most recent interest payment date to which interest has been paid or duly provided for, payable semiannually in arrears on January 21 and July 21 of each year (each an “Interest Payment Date”), commencing January 21, 2015. Interest on the Notes will be paid to Holders of record at the close of business on January 6 or July 6 immediately preceding an Interest Payment Date (each, a “Record Date”), notwithstanding any transfer, exchange or cancellation thereof after a Record Date and prior to the immediately following Interest Payment Date. Interest on the Notes will be calculated on the basis of a 360-day year comprised of twelve 30-day months.

Except as described under “Optional Redemption,” “Redemption for Taxation Reasons,” and otherwise provided in the Indenture, the Notes may not be redeemed prior to maturity (unless they have been repurchased by the Company).

In any case in which the date of the payment of principal of, premium on or interest on the Notes is not a Business Day in the relevant place of payment or in the place of business of the Paying and Transfer Agent, then payment of such principal, premium or interest need not be made on such date but may be made on the next succeeding Business Day. Any payment made on such Business Day shall have the same force and effect as if made on the date on which such payment is due, and no interest on the Notes shall accrue for the period after such date.

The Indenture allows additional Notes to be issued from time to time (the “Additional Notes”), subject to certain limitations described under “– Further Issues.” Unless the context requires otherwise, references to the “Notes” for all purposes of the Indenture and this “Description of the Notes” include any Additional Notes that are actually issued.

The Notes will be issued only in fully registered form, without coupons, in denominations of US$200,000 and integral multiples of US$1,000 in excess thereof. No service charge will be made for any registration of transfer or exchange of Notes, but the Company may require payment of a sum sufficient to cover any transfer tax or other similar governmental charge payable in connection therewith.

All payments on the Notes will be made in U.S. dollars by the Company at the office or agency of the Company maintained for that purpose (which initially will be the specified office of the Paying and Transfer Agent), and the Notes may be presented for registration of transfer or exchange at such office or agency; provided that, at the option of the Company, payment of interest may be made by check mailed to the address of the Holders as such address appears in the Note register maintained by the Registrar. Interest payable on the Notes held through Euroclear or Clearstream will be available to Euroclear or Clearstream participants (as defined herein) on the Business Day following payment thereof.

The Subsidiary Guarantees

The initial Subsidiary Guarantors that will execute the Indenture on the Original Issue Date will consist of all of the Company’s Restricted Subsidiaries other than (i) those Restricted Subsidiaries organized under the laws of the PRC (the “PRC Non-Guarantor Subsidiaries”) and (ii) Exalt Creation Limited, Aceled Limited, Emerald Sea Holdings Limited, Heroic Time Global Limited, Flourish Source Holdings Limited, Hong Kong Flourishing Development Limited, Hong Kong Excellent Development Limited, Hong Kong Exaltation Development Limited, Hong Kong Perpetual Development Limited and Hong Kong Grand Development Limited (such Restricted Subsidiaries in this clause (ii) are collectively referred to as the “Existing Offshore Non-Guarantor Subsidiaries”).

The Subsidiary Guarantors are holding companies that do not have significant operations. None of the existing or future Restricted Subsidiaries organized under the laws of the PRC will provide a Subsidiary Guarantee or JV Subsidiary Guarantee on the Original Issue Date or at any time in the future.

The JV Subsidiary Guarantees

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concurrently become a Restricted Subsidiary), the Company may, concurrently with the consummation of such sale or purchase, provide a JV Subsidiary Guarantee (as defined below) instead of a Subsidiary Guarantee for (a) such Restricted Subsidiary and (b) the Restricted Subsidiaries of such Restricted Subsidiary that are organized in any jurisdiction other than the PRC, if the following conditions, in the case of both (a) and (b), are satisfied:

as of the date of execution of a JV Subsidiary Guarantee (as defined below), no document exists that is binding on the Company or any Restricted Subsidiary that would have the effect of (a) prohibiting the Company or any Restricted Subsidiary from providing such JV Subsidiary Guarantee or (b) requiring the Company or any Restricted Subsidiary to deliver or keep in place a guarantee on terms that are more favorable to the recipients of such guarantee than such JV Subsidiary Guarantee;
such sale of Capital Stock is made to, or such purchase of Capital Stock is made from, an Independent Third Party at a consideration that is not less than the appraised value of such Capital Stock determined by an independent appraisal firm of recognized international standing appointed by the Company;
as of the date of execution of the JV Subsidiary Guarantee, after giving effect to such sale or purchase of Capital Stock of such Restricted Subsidiary that becomes a JV Subsidiary Guarantor, the Non-Guaranteed Portion (as defined below) with respect to all of the JV Subsidiary Guarantors then existing and their respective Restricted Subsidiaries does not exceed 10.0% of Total Assets;
all capital contributions (by way of transfer of cash or other property or any payment for property or services for the use of others or otherwise) to be made into a JV Subsidiary Guarantor from the date of sale or purchase of Capital Stock of such Restricted Subsidiary that becomes a JV Subsidiary Guarantor as referred to above, shall be made directly or by contribution of assets or services having an equivalent Fair Market Value by (i) the Company and its Restricted Subsidiaries and (ii) such Independent Third Party that purchased or sold the Capital Stock of such Restricted Subsidiary that becomes a JV Subsidiary Guarantor in proportion to their respective direct or indirect ownership percentages of the Capital Stock of such JV Subsidiary Guarantor;
concurrently with providing the JV Subsidiary Guarantee, the Company shall or shall cause such JV Subsidiary Guarantor to deliver to the Trustee:
(i) (A) a duly executed JV Subsidiary Guarantee of such JV Subsidiary Guarantor (the “JV Subsidiary Guarantee”) and each Restricted Subsidiary of such JV Subsidiary Guarantor that is not organized under the laws of the PRC, and (B) a duly executed supplemental indenture to the Indenture pursuant to which such JV Subsidiary Guarantor will guarantee the payment of the Notes, each of which provides, among other things, that the aggregate claims of the Trustee under such JV Subsidiary Guarantee and all JV Subsidiary Guarantees provided by the Restricted Subsidiaries and shareholders of such JV Subsidiary Guarantor will be limited to the JV Entitlement Amount;
(ii) a duly executed Security Document that pledges in favor of the Collateral Agent for itself and for the benefit of the Trustee the Capital Stock of such JV Subsidiary Guarantor held by the Company or any Subsidiary Guarantor, but not the Capital Stock of the direct or indirect Subsidiaries of such JV Subsidiary Guarantor;
(iii) an Officers’ Certificate certifying a copy of the Board Resolution to the effect that such JV Subsidiary Guarantee has been approved by a majority of the disinterested members of the Board of Directors; and
(iv) a legal opinion by a law firm of recognized international standing confirming that under New York law such JV Subsidiary Guarantees are valid, binding and enforceable against the JV Subsidiary Guarantors providing such JV Subsidiary Guarantees (subject to customary qualifications and assumptions).

As of December 31, 2013, the Company and its consolidated subsidiaries had total current and non-current borrowings of approximately RMB13,889.6 million (US$2,294.4 million), of which approximately RMB13,489.6 million (US$2,228.3 million) was secured.

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As of December 31, 2013, the Non-Guarantor Subsidiaries had total liabilities of approximately RMB33,783.1 million (US$5,580.6 million) and the Non-Guarantor Subsidiaries had capital commitments of approximately RMB11,748.4 million (US$1,940.7 million) and contingent liabilities of approximately RMB2,980.7 million (US$492.4 million).

The Subsidiary Guarantee of each Subsidiary Guarantor:

is a general obligation of such Subsidiary Guarantor;
is effectively subordinated to secured obligations of such Subsidiary Guarantor, to the extent of the value of the assets serving as security therefor;
is senior in right of payment to all future obligations of such Subsidiary Guarantor expressly subordinated in right of payment to such Subsidiary Guarantee; and
ranks at least pari passu with all other unsecured, unsubordinated Indebtedness of such Subsidiary Guarantor (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law).

If any is provided, the JV Subsidiary Guarantee of each JV Subsidiary Guarantor:

will be a general obligation of such JV Subsidiary Guarantor;
will be enforceable only up to the JV Entitlement Amount;
will be effectively subordinated to secured obligations of such JV Subsidiary Guarantor, to the extent of the value of the assets serving as security therefor;
will be limited to the JV Entitlement Amount, and will be senior in right of payment to all future obligations of such JV Subsidiary Guarantor expressly subordinated in right of payment to such JV Subsidiary Guarantee; and
will be limited to the JV Entitlement Amount, and will rank at least pari passu with all other unsecured, unsubordinated Indebtedness of such JV Subsidiary Guarantor (subject to any priority rights of such unsubordinated Indebtedness pursuant to applicable law).

Offshore Non-Guarantor Subsidiaries

The Company will cause each of its future Restricted Subsidiaries (other than Persons organized under the laws of the PRC), promptly upon becoming a Restricted Subsidiary, to execute and deliver to the Trustee a supplemental indenture to the Indenture pursuant to which such Restricted Subsidiary will Guarantee the payment of the Notes as either a Subsidiary Guarantor or a JV Subsidiary Guarantor. Notwithstanding the foregoing, the Company may elect to have any future Restricted Subsidiary (and its Restricted Subsidiaries) organized outside the PRC not provide a Subsidiary Guarantee or JV Subsidiary Guarantee at the time such entity becomes a Restricted Subsidiary (each such entity a “New Offshore Non-Guarantor Subsidiary” and, together with the Existing Offshore Non-Guarantor Subsidiaries, the “Offshore Non-Guarantor Subsidiaries”)), provided that, after giving effect to the Consolidated Assets of such Restricted Subsidiary, the Consolidated Assets of all Restricted Subsidiaries organized outside the PRC that are not Subsidiary Guarantors or JV Subsidiary Guarantors do not account for more than 15.0% of the Total Assets of the Company.

In the case of a Subsidiary Guarantor with respect to which the Company or any Restricted Subsidiary is proposing to sell, whether through the sale of existing shares or the issuance of new shares, no less than 20% of the Capital Stock of such Subsidiary Guarantor, the Company may concurrently with the consummation of such sale or issuance of Capital Stock, (a) instruct the Trustee to release the Subsidiary Guarantees provided by such Subsidiary Guarantor and each of its Restricted Subsidiaries organized outside the PRC, and upon such release such Subsidiary Guarantor and its Restricted Subsidiaries organized outside the PRC will become Offshore Non-Guarantor Subsidiaries (such that they will no longer Guarantee the Notes) and (b) instruct the Collateral Agent to (i) discharge the pledge of the Capital Stock granted by each such Offshore Non-Guarantor Subsidiary and (ii) discharge the pledge of Capital Stock made by the Company or any Subsidiary Guarantor over the shares it owns in each such Offshore Non-Guarantor Subsidiary (in each case, without any requirement to seek the consent or approval of the Holders of the Notes), provided that after the release of such Subsidiary Guarantees, the Consolidated Assets of all Restricted Subsidiaries organized outside the PRC that are not

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Subsidiary Guarantors or JV Subsidiary Guarantors (including such Offshore Non-Guarantor Subsidiaries) do not account for more than 15.0% of the Total Assets of the Company. A Subsidiary Guarantee of a Subsidiary Guarantor may only be released pursuant to this paragraph if as of the date of such proposed release, no document exists that is binding on the Company or any Restricted Subsidiary that would have the effect of requiring the Company or such Subsidiary Guarantor to deliver or keep in place a guarantee of other Indebtedness of the Company by such Subsidiary Guarantor.

Each Restricted Subsidiary that guarantees the Notes after the Original Issue Date other than a JV Subsidiary Guarantee is referred to as a “Future Subsidiary Guarantor” and upon execution of the applicable supplemental indenture to the Indenture will be a “Subsidiary Guarantor.” The Offshore Non-Guarantor Subsidiaries together with the PRC Non-Guarantor Subsidiaries are referred to herein as the “Non-Guarantor Subsidiaries.”

Although the Indenture contains limitations on the amount of additional Indebtedness that Non-Guarantor Subsidiaries (including Restricted Subsidiaries organized under the laws of the PRC) may incur, the amount of such additional Indebtedness could be substantial. In the event of a bankruptcy, liquidation or reorganization of any Non-Guarantor Subsidiary, the Non-Guarantor Subsidiaries will pay the holders of their debt and their trade creditors before they will be able to distribute any of their assets to the Company.

In addition, subject to the limitations described in “Risk Factors – Risks Relating to the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Collateral,” the Subsidiary Guarantee of each Subsidiary Guarantor Pledgor:

will be entitled to the benefit of a lien on the Collateral (subject to any Permitted Liens and the Intercreditor Agreement and shared on a pari passu basis with (i) holders of the January 2018 Notes, (ii) holders of the April 2016 Notes and (ii) any holders of other Permitted Pari Passu Secured Indebtedness) pledged by such Subsidiary Guarantor Pledgor, as described below under the caption “– Security”; and
will rank effectively senior in right of payment to the unsecured obligations of such Subsidiary Guarantor Pledgor with respect to the value of the Collateral securing such Subsidiary Guarantee (subject to any priority rights of such unsecured obligations pursuant to applicable law).

The JV Subsidiary Guarantee of each JV Subsidiary Guarantor will not be secured.

Under the Indenture, and any supplemental indenture to the Indenture, as applicable, each of the Subsidiary Guarantors and JV Subsidiary Guarantors (if any) will jointly and severally guarantee the due and punctual payment of the principal of, premium, if any, and interest on, and all other amounts payable under, the Notes; provided that any JV Subsidiary Guarantee will be limited to the JV Entitlement Amount. The Subsidiary Guarantors and JV Subsidiary Guarantors will (1) agree that their respective obligations under the Subsidiary Guarantees and JV Subsidiary Guarantees, as the case may be, will be enforceable irrespective of any invalidity, irregularity or unenforceability of the Notes or the Indenture and (2) waive their right to require the Trustee to pursue or exhaust its legal or equitable remedies against the Company prior to exercising its rights under the Subsidiary Guarantees and the JV Subsidiary Guarantees, as the case may be. Moreover, if at any time any amount paid under a Note or the Indenture is rescinded or must otherwise be restored, the rights of the Holders under the Subsidiary Guarantees and the JV Subsidiary Guarantees, as the case may be, will be reinstated with respect to such payment as though such payment had not been made. All payments under the Subsidiary Guarantees and the JV Subsidiary Guarantees, as the case may be, are required to be made in U.S. dollars.

Under the Indenture, and any supplemental indenture to the Indenture, as applicable,

each Subsidiary Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by the applicable Subsidiary Guarantor without rendering the Subsidiary Guarantee, as it relates to such Subsidiary Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally; and
each JV Subsidiary Guarantee will be limited to an amount which is the lower of (i) the JV Entitlement Amount and (ii) an amount not to exceed the maximum amount that can be guaranteed by the applicable JV Subsidiary Guarantor without rendering the JV Subsidiary Guarantee, as it relates to such JV Subsidiary Guarantor, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.

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If a Subsidiary Guarantee or JV Subsidiary Guarantee were to be rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees and other contingent liabilities) of the applicable Subsidiary Guarantor or JV Subsidiary Guarantor, as the case may be, and, depending on the amount of such indebtedness, a Subsidiary Guarantor’s liability on its Subsidiary Guarantee or a JV Subsidiary Guarantor’s liability on its JV Subsidiary Guarantee, as the case may be, could in each case be reduced to zero.

The obligations of each Subsidiary Guarantor under its Subsidiary Guarantee and the enforceability of the Collateral granted in respect of the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors may be limited, or possibly invalid, under applicable laws. Similarly, the obligations of each JV Subsidiary Guarantor under its JV Subsidiary Guarantee may be limited, or possibly invalid, under applicable laws. See “Risk Factors – Risks Relating to the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Collateral – The Subsidiary Guarantees or JV Subsidiary Guarantees may be challenged under applicable insolvency or fraudulent transfer laws, which could impair the enforceability of the Subsidiary Guarantees or JV Subsidiary Guarantees.”

Release of the Subsidiary Guarantees and JV Subsidiary Guarantees

A Subsidiary Guarantee given by a Subsidiary Guarantor and a JV Subsidiary Guarantee given by a JV Subsidiary Guarantor may be released in certain circumstances, including:

upon repayment in full of the Notes;
upon a defeasance as described under “– Defeasance – Defeasance and Discharge;”
upon the designation by the Company of a Subsidiary Guarantor or a JV Subsidiary Guarantor, as the case may be, as an Unrestricted Subsidiary in compliance with the terms of the Indenture;
upon the sale of a Subsidiary Guarantor or a JV Subsidiary Guarantor, as the case may be, in compliance with the terms of the Indenture (including the covenants described under the captions “– Limitation on Sales and Issuances of Capital Stock in Restricted Subsidiaries,” “– Limitation on Asset Sales” and “– Consolidation, Merger and Sale of Assets”) resulting in such Subsidiary Guarantor or JV Subsidiary Guarantor, as the case may be, no longer being a Restricted Subsidiary, so long as (1) such Subsidiary Guarantor or JV Subsidiary Guarantor, as the case may be, is simultaneously released from its obligations in respect of any of the Company’s other Indebtedness or any Indebtedness of any other Restricted Subsidiary and (2) the proceeds from such sale or disposition are used for the purposes permitted or required by the Indenture;
in the case of a Subsidiary Guarantee, upon the replacement of such a Subsidiary Guarantee with a JV Subsidiary Guarantee; or
in the case of a Subsidiary Guarantor that becomes an Offshore Non-Guarantor Subsidiary, in compliance with the terms of the Indenture.

No release of a Subsidiary Guarantor from its Subsidiary Guarantee or a JV Subsidiary Guarantor from its JV Subsidiary Guarantee shall be effective against the Trustee or the Holders until the Company has delivered to the Trustee an Officer’s Certificate stating that all requirements relating to such release have been complied with and such release is authorized and permitted by the terms of the Indenture.

Replacement of Subsidiary Guarantees with JV Subsidiary Guarantees

A Subsidiary Guarantee given by a Subsidiary Guarantor may be released following the sale or issuance by the Company or any Restricted Subsidiary of Capital Stock in (a) such Subsidiary Guarantor or (b) any other Subsidiary Guarantor that, directly or indirectly, owns a majority of the Capital Stock of such Subsidiary Guarantor, in each case where such sale or issuance, whether through the sale of existing shares or the issuance of new shares, is for no less than 20% and no more than 49.9% of the issued Capital Stock of the relevant Subsidiary Guarantor, provided that the following conditions are satisfied or complied with:

as of the date of such proposed release, no document exists that is binding on the Company or any of the Restricted Subsidiaries that would have the effect of (a) prohibiting the Company or any of the Restricted Subsidiaries from releasing such Subsidiary Guarantee, (b) prohibiting the Company or any of the Restricted Subsidiaries from providing a JV Subsidiary Guarantee, or (c) requiring the Company or any Restricted Subsidiary to deliver or keep in force a replacement guarantee on terms that are more favorable to the recipients of such guarantee than the JV Subsidiary Guarantee;

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such sale or issuance of Capital Stock is made to an Independent Third Party at a consideration that is not less than the appraised value of such Capital Stock determined by an independent appraisal firm of recognized international standing appointed by the Company;
as of the date of execution of the JV Subsidiary Guarantee, after giving effect to the issuance or sale of Capital Stock of such Subsidiary Guarantor that becomes a JV Subsidiary Guarantor, the Non-Guaranteed Portion with respect to all of the JV Subsidiary Guarantors then existing and their respective Restricted Subsidiaries does not exceed 10.0% of Total Assets;
all capital contributions (by way of transfer of cash or other property or any payment for property or services for the use of others or otherwise) to be made into such JV Subsidiary Guarantor from the date of issuance or sale of Capital Stock of such Subsidiary Guarantor that becomes such JV Subsidiary Guarantor as referred to above, shall be made directly or by contribution of assets or services having an equivalent Fair Market Value by (i) the Company and its Restricted Subsidiaries and (ii) such Independent Third Party that purchased or subscribed for Capital Stock in the JV Subsidiary Guarantor in proportion to their respective direct or indirect ownership percentages of the Capital Stock of such JV Subsidiary Guarantor;
concurrently with the release of such Subsidiary Guarantee, the Company shall or shall cause such JV Subsidiary Guarantor to deliver to the Trustee:
(i) (A) a duly executed JV Subsidiary Guarantee of such JV Subsidiary Guarantor and each Restricted Subsidiary of such JV Subsidiary Guarantor that is not organized under the laws of the PRC and (B) a duly executed supplemental indenture to the Indenture pursuant to which such JV Subsidiary Guarantor will guarantee the payment of the Notes, each of which provides, among other things, that the aggregate claims of the Trustee under such JV Subsidiary Guarantee and all JV Subsidiary Guarantees provided by the Restricted Subsidiaries and shareholders of such JV Subsidiary Guarantor will be limited to the JV Entitlement Amount;
(ii) a duly executed Security Document that pledges in favor of the Collateral Agent the Capital Stock of such JV Subsidiary Guarantor held by the Company or any Subsidiary Guarantor, but not the Capital Stock of the direct or indirect Subsidiaries of such JV Subsidiary Guarantor;
(iii) an Officers’ Certificate certifying a copy of a Board Resolution to the effect that such JV Subsidiary Guarantee has been approved by a majority of the disinterested members of the Board of Directors; and
(iv) a legal opinion by a law firm of recognized international standing confirming that under New York law such JV Subsidiary Guarantee is valid, binding and enforceable against the JV Subsidiary Guarantor providing such JV Subsidiary Guarantee (subject to customary qualifications and assumptions).

Notwithstanding the foregoing paragraph, any such sale or issuance of the Capital Stock of the relevant Subsidiary Guarantor (including where such sale results in the relevant Subsidiary Guarantor ceasing to be a Restricted Subsidiary) will need to comply with the other covenants set forth in the Indenture, including, without limitation, the “– Limitation on Asset Sales” and “– Limitation on Restricted Payments” covenants.

Any Net Cash Proceeds from the sale of such Capital Stock shall be applied by the Company (or any Restricted Subsidiary) in accordance with the “Limitation on Asset Sales” covenant.

As of the date of the Indenture, all of the Company’s Subsidiaries will be “Restricted Subsidiaries.” However, under the circumstances described below under the caption “– Certain Covenants – Designation of Restricted and Unrestricted Subsidiaries,” the Company will be permitted to designate certain of its Subsidiaries as “Unrestricted Subsidiaries.” The Company’s Unrestricted Subsidiaries will generally not be subject to the restrictive covenants in the Indenture. The Company’s Unrestricted Subsidiaries will not Guarantee the Notes.

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Security

The Company has pledged the Capital Stock of the Subsidiary Guarantors owned by the Company (subject to Permitted Liens and the Intercreditor Agreement) in order to secure the obligations of the Company under the January 2018 Notes and the January 2018 Notes Indenture as well as the April 2016 Notes and the April 2016 Notes Indenture. On the Original Issue Date, the Trustee will execute a supplement to and become a party to the Intercreditor Agreement, at which time the Trustee will become a Secured Party under the Intercreditor Agreement and the Holders will be entitled to share in the benefit of the pledge of such Capital Stock on a pari passu basis with the holders of the January 2018 Notes, the holders of the April 2016 Notes and the holders of any other Permitted Pari Passu Secured Indebtedness. See “– Intercreditor Agreement.”

None of the Capital Stock of the Non-Guarantor Subsidiaries will be pledged on the Original Issue Date or at any time in the future. In addition, none of the Capital Stock of any future Restricted Subsidiary that may be organized under the laws of the PRC will be pledged at any time in the future. If any JV Subsidiary Guarantor is established, the Capital Stock of such JV Subsidiary Guarantor owned by the Company or any Subsidiary Guarantor will be pledged to secure the obligations of the Company under the Notes and the Indenture, and of such Subsidiary Guarantor under its Subsidiary Guarantee, as the case may be, in the manner described above. However, none of the JV Subsidiary Guarantors will provide a Security Document pledging the Capital Stock of its direct or indirect Subsidiaries as security in favor of the Collateral Agent for itself and for the benefit of the Trustee.

The Company has also agreed, for the benefit of the Holders, to pledge, and cause each Subsidiary Guarantor (other than a JV Subsidiary Guarantor, if any) to pledge, the Capital Stock owned by the Company or such Subsidiary Guarantor of any Person that becomes a Restricted Subsidiary or additional shares of Capital Stock acquired or otherwise received by the Company or such Subsidiary Guarantor of any existing Restricted Subsidiary (in each case, other than Persons organized under the laws of the PRC or Offshore Non-Guarantor Subsidiaries) after the Original Issue Date, promptly upon such Person becoming a Restricted Subsidiary, to secure the obligations of the Company under the Notes and the Indenture, and of such Subsidiary Guarantor under its Subsidiary Guarantee, in the manner described above.

Each Subsidiary Guarantor that pledges Capital Stock of a Restricted Subsidiary after the Original Issue Date is referred to as a “Future Subsidiary Guarantor Pledgor” and, upon giving such pledge, will be a “Subsidiary Guarantor Pledgor.”

The value of the Collateral securing the Notes and the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors (as reduced by the obligations owed to other secured creditors under the Intercreditor Agreement) is unlikely to be sufficient to satisfy the Company’s and each of the Subsidiary Guarantor Pledgors’ obligations under the Notes and the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors (as reduced by the obligations owed to other secured creditors under the Intercreditor Agreement), and the Collateral securing the Notes and such Subsidiary Guarantee (as reduced by the obligations owed to other secured creditors under the Intercreditor Agreement) may be reduced or diluted under certain circumstances, including the issuance of Additional Notes and other Permitted Pari Passu Secured Indebtedness and the disposition of assets comprising the Collateral, subject to the terms of the Indenture and the Intercreditor Agreement. See “– Release of Security” and “Risk Factors – Risks Relating to the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Collateral – The value of the Collateral is unlikely to be sufficient to satisfy our obligations under the Notes and other pari passu secured indebtedness.”

No appraisals of the Collateral have been prepared in connection with this offering of the Notes. There can be no assurance that the proceeds of any sale of the Collateral, in whole or in part, pursuant to the Indenture, the Intercreditor Agreement and the Security Documents following an Event of Default, would be sufficient to satisfy amounts due on the Notes or the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors (as reduced by the obligations owed to other secured creditors under the Intercreditor Agreement). By its nature, some or all of the Collateral will be illiquid and may have no readily ascertainable market value. Accordingly, there can be no assurance that the Collateral would be sold in a timely manner or at all.

So long as no Event of Default has occurred and is continuing, and subject to the terms of the Security Documents and the Indenture, the Company and the Subsidiary Guarantor Pledgors, as the case may be, will be entitled to exercise any and all voting rights and to receive, retain and use any and all cash dividends, stock dividends, liquidating dividends, non-cash dividends, shares or stock resulting from stock splits or reclassifications, rights issues, warrants, options and other distributions (whether similar or dissimilar to the foregoing) in respect of Capital Stock constituting Collateral.

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Permitted Pari Passu Secured Indebtedness

On or after the Original Issue Date, the Company and each Subsidiary Guarantor Pledgor may create Liens on the Collateral pari passu with the Lien for the benefit of the Holders to secure Indebtedness of the Company (including Additional Notes) and any Pari Passu Subsidiary Guarantee of a Subsidiary Guarantor Pledgor with respect to such Indebtedness (such Indebtedness of the Company and any such Pari Passu Subsidiary Guarantee, “Permitted Pari Passu Secured Indebtedness”); provided that (1) the Company or such Subsidiary Guarantor Pledgor was permitted to Incur such Indebtedness under the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”; (2) the holders of such Indebtedness (or their representative) become party to the Intercreditor Agreement (see “– Intercreditor Agreement”); and (3) the Company and such Subsidiary Guarantor Pledgor deliver to the Trustee an Opinion of Counsel and Officers’ Certificate with respect to corporate and collateral matters in connection with the Security Documents, in form and substance as set forth in the Security Documents. The Trustee and the Collateral Agent will be permitted and authorized, without the consent of any Holder, to enter into the Security Documents and the Intercreditor Agreement or any amendment thereto or to the Indenture and take any other action necessary to permit the creation and registration of Liens on the Collateral to secure Permitted Pari Passu Secured Indebtedness in accordance with this paragraph and the terms of the Indenture (including, without limitation, the appointment of any collateral agent under the Intercreditor Agreement to hold the Collateral on behalf of the Holders, the holders of the January 2018 Notes, the holders of the April 2016 Notes and any holders of other Permitted Pari Passu Secured Indebtedness).

Except for certain Permitted Liens and the Permitted Pari Passu Secured Indebtedness, the Company and its Restricted Subsidiaries will not be permitted to issue or Incur any other Indebtedness secured by all or any portion of the Collateral without the consent of each Holder of the Notes then outstanding.

Intercreditor Agreement

On April 23, 2013, the Company, the January 2018 Notes Trustee, April 2016 Notes Trustee and the Collateral Agent entered into an intercreditor agreement (the “Intercreditor Agreement”), to which the Trustee for the benefit of the Holders will accede on the Original Issue Date. The Intercreditor Agreement provides, among other things, that (1) the Secured Parties share equal priority and pro rata entitlement in and to the Collateral; (2) the Collateral shall only be substituted or released and Liens only be granted on the Collateral to the extent permitted under the Debt Documents; (3) holders of any future Permitted Pari Passu Secured Indebtedness (or their respective representatives) that are secured by the Collateral shall also appoint the Collateral Agent to act as their collateral agent with respect to the Collateral; and (4) the conditions under which the Collateral Agent shall enforce the rights of the Secured Parties with respect to the Collateral and the Indebtedness secured thereby as described in “– Enforcement of Security” below. The Intercreditor Agreement also contains terms with respect to rights, duties, liabilities and expenses of the Trustee, the January 2018 Notes Trustee, the April 2016 Notes Trustee, any other Creditor Representative and the Collateral Agent that are satisfactory to such parties.

The Intercreditor Agreement also provides that in connection with any future Permitted Pari Passu Secured Indebtedness (other than Additional Notes), the holders of such Permitted Pari Passu Secured Indebtedness (or their representative) will accede to the Intercreditor Agreement and become parties to it.

By accepting the Notes, each Holder shall be deemed to have consented to the accession to, and terms of, the Intercreditor Agreement, any supplements, amendments or modifications thereto, and any future intercreditor agreement that may be required under the terms of the Indenture.

Enforcement of Security

The Liens securing the Notes and the Subsidiary Guarantees of the Subsidiary Guarantor Pledgors will be granted to the Collateral Agent. The Collateral Agent, subject to the Intercreditor Agreement, will hold such Liens over the Collateral granted pursuant to the Security Documents with sole authority as directed by the written instruction of the Trustee and any other Creditor Representatives to exercise remedies under the Security Documents (subject to the terms of the Intercreditor Agreement). The Collateral Agent has agreed to act as secured party on behalf of the creditors under the Debt Documents under the applicable Security Documents, to follow instructions provided to it by one or more of the Creditor Representatives under the Indenture, the Security Documents and/or the Intercreditor Agreement and to carry out certain other duties.

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The Indenture and/or the Security Documents principally provide that, at any time while the Notes are outstanding, the Collateral Agent has the right, subject to the Intercreditor Agreement, to manage, perform and enforce the terms of the Security Documents relating to the Collateral and to exercise and enforce all privileges, rights and remedies thereunder according to its direction, including to take or retake control or possession of such Collateral and to hold, prepare for sale, process, lease, dispose of or liquidate such Collateral, including, without limitation, following the occurrence of an Event of Default under the Indenture.

The Intercreditor Agreement provides, among other things, that any Secured Party may instruct the Collateral Agent to enforce the Collateral and to deliver a notice of enforcement to the Company and the applicable Subsidiary Guarantor Pledgor (such instructions, the “Enforcement Instructions”). Upon receipt of an Enforcement Instruction from any Secured Party, the Collateral Agent will provide a copy of such Enforcement Instruction and notice of enforcement to the Company and the other Secured Parties. If (a) the Collateral Agent identifies a conflict (i) between Secured Parties’ interests in connection with any Enforcement Instruction or (ii) in the event that more than one of the Secured Parties issues Enforcement Instructions, between those Enforcement Instructions, and (b) the Collateral Agent believes in its sole discretion that the interests of the Secured Parties would be in conflict upon the exercise of those Enforcement Instructions, or that compliance with an Enforcement Instruction would cause the Collateral Agent to contravene another Enforcement Instruction, the Collateral Agent shall notify each Secured Party in writing not more than five Business Days after it becomes aware of such conflict. In such circumstances, the Collateral Agent is not obligated to take any action if it identifies such conflict and will not take any action with respect to which the instructions or interests of the Secured Parties are in conflict until such conflict has been resolved in accordance with the Intercreditor Agreement.

The Intercreditor Agreement provides that any proceeds from any sale, collection, liquidation or enforcement of the Collateral shall be distributed by the Collateral Agent in accordance with the terms of the Intercreditor Agreement and subject to the conditions of the relevant Security Document. Such proceeds shall be applied as follows:

first , to the Collateral Agent to the extent necessary to reimburse the Collateral Agent for any expenses (including properly incurred expenses of its counsel) incurred in connection with the collection or distribution of such amounts held or realized or in connection with expenses incurred in enforcing remedies under the Intercreditor Agreement and the Security Documents and preserving the Collateral and all amounts for which the Collateral Agent is entitled to indemnification under the Indenture, Intercreditor Agreement or the Security Documents;

second , to the extent not reimbursed under the above paragraph, to the Trustee, the Agents, the January 2018 Notes Trustee, the April 2016 Notes Trustee and any other Creditor Representatives, to the extent necessary to reimburse the foregoing persons ratably for any expenses (including properly incurred expenses of counsel) incurred in connection with the collection or distribution of such amounts held or realized or in connection with expenses incurred in enforcing remedies under the Debt Documents, Intercreditor Agreement and the Security Documents and preserving the Collateral and all amounts for which the foregoing persons are entitled to indemnification under the Debt Documents, Intercreditor Agreement and the Security Documents;

third , ratably to each of the Trustee for the benefit of the Holders to satisfy outstanding obligations under the Notes and the Indenture, the January 2018 Notes Trustee for the benefit of holders of the January 2018 Notes to satisfy outstanding obligations under the January 2018 Notes and the January 2018 Indenture, the April 2016 Notes Trustee for the benefit of holders of the April 2016 Notes to satisfy outstanding obligations under the April 2016 Notes and the April 2016 Notes Indenture and, to the extent applicable, to other Creditor Representatives for the benefit of the holders of any Permitted Pari Passu Secured Indebtedness to satisfy outstanding obligations thereunder (in each case, to the extent not paid pursuant to the paragraphs above), in accordance with the terms of the relevant Debt Documents; and

fourth , any surplus remaining after such payments will be paid to the Company, the Subsidiary Guarantor Pledgors or to whomever may be lawfully entitled thereto.

The Collateral Agent may refrain from acting in accordance with the instructions of the Holders and the holders of any Permitted Pari Passu Indebtedness Parties and may decline to expend its own funds, foreclose on the Collateral or exercise remedies available if it does not receive indemnification and/or security to its satisfaction. In addition, the Collateral Agent’s ability to foreclose on the Collateral may be subject to lack of

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perfection, the consent of third parties, prior Liens and practical problems associated with the realization of the Collateral Agent’s Liens on the Collateral. Neither the Trustee, the Collateral Agent nor any of their respective officers, directors, employees, attorneys or agents will be responsible or liable for the existence, genuineness, value or protection of any Collateral securing the Notes, for the legality, existence, genuineness, value, adequacy or protection of any Collateral securing the Notes, for the legality, enforceability, effectiveness or sufficiency of the Security Documents or the Intercreditor Agreement, for the creation, perfection, continuation, priority, sufficiency or protection of any of the Liens, or for any defect or deficiency as to any such matters, or for any failure to demand, collect, foreclose or realize upon or otherwise enforce any of the Liens or Security Documents or any delay in doing so.

The Security Documents provide that the Company and the Subsidiary Guarantor Pledgors will indemnify the Collateral Agent for all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind imposed against the Collateral Agent arising out of the Security Documents except to the extent that any of the foregoing are finally judicially determined to have resulted from the gross negligence or willful misconduct of the Collateral Agent.

This section, “– Enforcement of Security,” shall be subject to any amendments to the Security Documents or the Indenture to permit the creation of Liens on the Collateral to secure Permitted Pari Passu Secured Indebtedness in accordance with “– Permitted Pari Passu Secured Indebtedness” above.

Release of Security

Subject to the provisions of the Intercreditor Agreement, the security created in respect of the Collateral granted under the Security Documents may be released in relation to the Notes and the Subsidiary Guarantees in certain circumstances, including:

upon repayment in full of the Notes;
upon defeasance and discharge of the Notes as provided below under the caption “– Defeasance – Defeasance and Discharge;”
upon certain dispositions of the Collateral in compliance with the covenants described under the captions “– Limitation on Sales and Issuances of Capital Stock in Restricted Subsidiaries” or “– Limitation on Asset Sales” or in accordance with the provision under the caption “– Consolidation, Merger and Sale of Assets;”
with respect to security granted by a Subsidiary Guarantor Pledgor, upon the release of the Subsidiary Guarantee of such Subsidiary Guarantor Pledgor in accordance with the terms of the Indenture;
in connection with and upon execution of a JV Subsidiary Guarantee to replace a Subsidiary Guarantee, with respect to all pledges of Capital Stock granted by such JV Subsidiary Guarantor in its direct and indirect Subsidiaries, and in accordance with the terms of the Indenture; or
with respect to a Subsidiary Guarantor that becomes an Offshore Non-Guarantor Subsidiary, the release of the pledge of Capital Stock made by the Company or any Subsidiary Guarantor over the shares it owns in such Offshore Non-Guarantor Subsidiary.

Further Issues

Subject to the covenants described below and in accordance with the terms of the Indenture, the Company may, from time to time, without notice to or the consent of the Holders, create and issue Additional Notes having the same terms and conditions as the Notes (including the benefit of the Subsidiary Guarantees and JV Subsidiary Guarantees) in all respects (or in all respects except for the issue date, issue price and the first payment of interest on them and, to the extent necessary, certain temporary securities law transfer restrictions) (a “Further Issue”) so that such Additional Notes may be consolidated and form a single class with the previously outstanding Notes and vote together as one class on all matters with respect to the Notes; provided that the issuance of any such Additional Notes shall then be permitted under the “Limitation on Indebtedness and Preferred Stock” covenant described below.

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Optional Redemption

At any time and from time to time on or after July 21, 2017, the Company may redeem the Notes, in whole or in part, at a redemption price equal to the percentage of principal amount set forth below, plus accrued and unpaid interest, if any, to (but excluding) the redemption date, if redeemed during the 12-month period commencing on July 21 of any year set forth below:

Period		Redemption Price

2017	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	105.125%
2018	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	102.5625%

At any time prior to July 21, 2017, the Company may at its option redeem the Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of the Notes plus the Applicable Premium as of, and accrued and unpaid interest, if any, to (but not including) the redemption date. Neither the Trustee nor any of the Agents shall be responsible for verifying or calculating the Applicable Premium.

At any time and from time to time prior to July 21, 2017, the Company may redeem up to 35% of the aggregate principal amount of the Notes with the Net Cash Proceeds of one or more sales of Common Stock of the Company in an Equity Offering at a redemption price of 110.25% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to (but not including) the redemption date; provided that at least 65% of the aggregate principal amount of the Notes issued on the Original Issue Date remains outstanding after each such redemption and any such redemption takes place within 60 days after the closing of the related Equity Offering.

Selection and Notice

The Company will give not less than 30 days’ nor more than 60 days’ notice of any redemption. If less than all of the Notes are to be redeemed at any time, the Notes for redemption will be selected as follows:

(1) if the Notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes are listed or if the Notes are held through the clearing systems, in compliance with the requirements of such clearing systems; or
(2) if the Notes are not listed on any national securities exchange, on a pro rata basis, by lot or by such other method as the Trustee in its sole discretion deems fair and appropriate.

A Note of US$200,000 in principal amount or less shall not be redeemed in part. If any Note is to be redeemed in part only, the notice of redemption relating to such Note will state the portion of the principal amount to be redeemed. A new Note in principal amount equal to the unredeemed portion will be issued upon cancellation of the original Note. On and after the redemption date, interest will cease to accrue on Notes or portions of them called for redemption.

Repurchase of Notes Upon a Change of Control Triggering Event

Not later than 30 days following a Change of Control Triggering Event, the Company will make an Offer to Purchase all outstanding Notes (a “Change of Control Offer”) at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest, if any, to (but not including) the Offer to Purchase Payment Date.

The Company has agreed in the Indenture that it will timely repay all Indebtedness or obtain consents as necessary under, or terminate, agreements or instruments that would otherwise prohibit a Change of Control Offer required to be made pursuant to the Indenture. Notwithstanding this agreement of the Company, it is important to note that if the Company is unable to repay (or cause to be repaid) all of the Indebtedness, if any, that would prohibit repurchase of the Notes or is unable to obtain the requisite consents of the holders of such Indebtedness, or terminate any agreements or instruments that would otherwise prohibit a Change of Control Offer, it would continue to be prohibited from purchasing the Notes. In that case, the Company’s failure to purchase tendered Notes would constitute an Event of Default under the Indenture.

Certain of the events constituting a Change of Control Triggering Event under the Notes will also constitute an event of default under certain other debt instruments of the Company and its Subsidiaries. Future

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debt of the Company may also (1) prohibit the Company from purchasing Notes in the event of a Change of Control Triggering Event; (2) provide that a Change of Control Triggering Event is a default; or (3) require repurchase of such debt upon a Change of Control Triggering Event. Moreover, the exercise by the Holders of their right to require the Company to purchase the Notes could cause a default under other Indebtedness, even if the Change of Control Triggering Event itself does not, due to the financial effect of the purchase on the Company. The Company’s ability to pay cash to the Holders following the occurrence of a Change of Control Triggering Event may be limited by the Company’s and the Subsidiary Guarantors’ then-existing financial resources. There can be no assurance that sufficient funds will be available when necessary to make the required purchase of the Notes. See “Risk Factors – Risks Relating to the Notes – We may not be able to repurchase the Notes, the January 2018 Notes or the April 2016 Notes upon a Change of Control Triggering Event.”

The phrase “all or substantially all”, as used with respect to the assets of the Company in the definition of “Change of Control,” will likely be interpreted under applicable law of the relevant jurisdictions and will be dependent upon particular facts and circumstances. As a result, there may be a degree of uncertainty in ascertaining whether a sale or transfer of “all or substantially all” the assets of the Company has occurred.

Notwithstanding the above, the Company will not be required to make a Change of Control Offer following a Change of Control if a third party makes the Change of Control Offer in the same manner, at the same times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer.

Except as described above with respect to a Change of Control Triggering Event, the Indenture does not contain provisions that permit the Holders to require that the Company purchase or redeem the Notes in the event of a takeover, recapitalization or similar transaction.

No Mandatory Redemption or Sinking Fund

There will be no mandatory redemption or sinking fund payments for the Notes.

Additional Amounts

All payments of principal of, and premium (if any) and interest on the Notes or under the Subsidiary Guarantees and JV Subsidiary Guarantees will be made without withholding or deduction for, or on account of, any present or future taxes, duties, assessments or governmental charges of whatever nature imposed or levied by or within any jurisdiction in which the Company, a Surviving Person (as defined under the caption “– Consolidation, Merger and Sale of Assets”) or an applicable Subsidiary Guarantor or JV Subsidiary Guarantor is organized or resident for tax purposes (or any political subdivision or taxing authority thereof or therein), including, without limitation, if applicable, the PRC (each, as applicable, a “Relevant Jurisdiction”), or any jurisdiction through which payments are made by or on behalf of the Company, a Surviving Person or an applicable Subsidiary Guarantor or JV Subsidiary Guarantor, unless such withholding or deduction is required by law or by regulation or governmental policy having the force of law. In the event that any such withholding or deduction is so required, the Company, a Surviving Person or the applicable Subsidiary Guarantor or JV Subsidiary Guarantor, as the case may be, will pay such additional amounts (“Additional Amounts”) as will result in receipt by the Holder of each Note of such amounts as would have been received by such Holder had no such withholding or deduction been required, except that no Additional Amounts shall be payable:

(1) for or on account of:
(a) any tax, duty, assessment or other governmental charge that would not have been imposed but for:
- (i) the existence of any present or former connection between the Holder or beneficial owner of such Note and the Relevant Jurisdiction or the jurisdiction through which payments are made, other than merely holding such Note or the receipt of payments thereunder or under a Subsidiary Guarantee or JV Subsidiary Guarantee, including, without limitation, such Holder or beneficial owner being or having been a national, domiciliary or resident of such Relevant Jurisdiction or treated as a resident thereof or being or having been physically present or engaged in a trade or business therein or having or having had a permanent establishment therein;

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  - (ii) the presentation of such Note (in cases in which presentation is required) more than 30 days after the later of the date on which the payment of the principal of, premium, if any, and interest on, such Note became due and payable pursuant to the terms thereof or was made or duly provided for, except to the extent that the Holder thereof would have been entitled to such Additional Amounts if it had presented such Note for payment on any date within such 30-day period;

  - (iii) the failure of the Holder or beneficial owner to comply with a timely request of the Company, a Surviving Person, any Subsidiary Guarantor or any JV Subsidiary Guarantor addressed to the Holder, to provide information concerning such Holder’s or its beneficial owner’s nationality, residence, identity or connection with any Relevant Jurisdiction or the jurisdiction through which payments are made, if and to the extent that due and timely compliance with such request is required under the tax laws of such jurisdiction in order to reduce or eliminate any withholding or deduction as to which Additional Amounts would have otherwise been payable to such Holder; or

  - (iv) the presentation of such Note (in cases in which presentation is required) for payment in the Relevant Jurisdiction or the jurisdiction through which payments are made, unless such Note could not have been presented for payment elsewhere;

(b) any estate, inheritance, gift, sale, transfer, personal property or similar tax, assessment or other governmental charge;
(c) any withholding or deduction that is imposed or levied on a payment to an individual and is required to be made pursuant to European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of November 26-27, 2000 on the taxation of savings income or any law implementing or complying with, or introduced in order to conform to, such Directives;
(d) any tax, assessment, withholding or deduction required by sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended (“FATCA”), any current or future Treasury Regulations or rulings promulgated thereunder, any law, regulation or other official guidance enacted in any jurisdiction implementing FATCA, any intergovernmental agreement between the United States and any other jurisdiction to implement FATCA, or any agreement with the U.S. Internal Revenue Service under FATCA; or
(e) any combination of taxes, duties, assessments or other governmental charges referred to in the preceding clauses (a), (b), (c) and (d); or
(2) to a Holder that is a fiduciary, partnership or person other than the sole beneficial owner of any payment to the extent that such payment would be required to be included in the income under the laws of a Relevant Jurisdiction or the jurisdiction through which payments are made, for tax purposes, of a beneficiary or settlor with respect to the fiduciary, or a member of that partnership or a beneficial owner who would not have been entitled to such Additional Amounts had that beneficiary, settlor, partner or beneficial owner been the Holder thereof.

Whenever there is mentioned in any context the payment of principal of, and any premium or interest on, any Note or under any Subsidiary Guarantee or JV Subsidiary Guarantee, such mention shall be deemed to include payment of Additional Amounts provided for in the Indenture to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof.

Redemption for Taxation Reasons

The Notes may be redeemed, at the option of the Company or a Surviving Person with respect to the Company, as a whole but not in part, upon giving not less than 30 days’ nor more than 60 days’ notice to the Holders (which notice shall be irrevocable), at a redemption price equal to 100% of the principal amount thereof, together with accrued and unpaid interest (including any Additional Amounts), if any, to the date fixed by the Company or the Surviving Person, as the case may be, for redemption (the “Tax Redemption Date”) if, as a result of:

(1) any change in, or amendment to, the laws (or any regulations or rulings promulgated thereunder) of a Relevant Jurisdiction affecting taxation; or

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(2) any change in the existing official position or the stating of an official position regarding the application or interpretation of such laws, regulations or rulings (including a holding, judgment or order by a court of competent jurisdiction),

which change or amendment is proposed and becomes effective (i) with respect to the Company or any initial Subsidiary Guarantor on or after the Original Issue Date, or (ii) with respect to any Future Subsidiary Guarantor, JV Subsidiary Guarantor or Surviving Person, on or after the date such Future Subsidiary Guarantor, JV Subsidiary Guarantor or Surviving Person becomes a Subsidiary Guarantor, JV Subsidiary Guarantor or Surviving Person, with respect to any payment due or to become due under the Notes or the Indenture, the Company, a Subsidiary Guarantor, a JV Subsidiary Guarantor or a Surviving Person, as the case may be, is, or on the next Interest Payment Date would be, required to pay Additional Amounts, and such requirement cannot be avoided by the taking of reasonable measures by the Company, a Subsidiary Guarantor, a JV Subsidiary Guarantor or a Surviving Person, as the case may be; provided that no such notice of redemption shall be given earlier than 90 days prior to the earliest date on which the Company, a Subsidiary Guarantor, a JV Subsidiary Guarantor or a Surviving Person, as the case may be, would be obligated to pay such Additional Amounts if a payment in respect of the Notes were then due.

Prior to the mailing of any notice of redemption of the Notes pursuant to the foregoing, the Company, a Subsidiary Guarantor, a JV Subsidiary Guarantor or a Surviving Person, as the case may be, will deliver to the Trustee at least 30 days but not more than 60 days before a redemption date:

(1) an Officers’ Certificate stating that such change or amendment referred to in the prior paragraph has occurred, describing the facts related thereto and stating that such requirement cannot be avoided by the Company, a Subsidiary Guarantor, a JV Subsidiary Guarantor or a Surviving Person as the case may be, taking reasonable measures available to it; and
(2) an Opinion of Counsel or an opinion of a tax consultant, in either case of recognized standing with respect to tax matters of the Relevant Jurisdiction, stating that the requirement to pay such Additional Amounts results from such change or amendment referred to in the prior paragraph.

The Trustee shall be entitled to accept such certificate and opinion as sufficient evidence of the satisfaction of the conditions precedent described above, in which event it shall be conclusive and binding on the Holders.

Any Notes that are redeemed will be cancelled.

Certain Covenants

Set forth below are summaries of certain covenants contained in the Indenture.

Limitation on Indebtedness and Preferred Stock

(1) The Company will not, and will not permit any Restricted Subsidiary to, Incur any Indebtedness (including Acquired Indebtedness), and the Company will not permit any Restricted Subsidiary to issue Preferred Stock; provided that the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor may Incur Indebtedness (including Acquired Indebtedness) and any Restricted Subsidiary that is a Non-Guarantor Subsidiary may Incur Permitted Subsidiary Indebtedness if, after giving effect to the Incurrence of such Indebtedness and the receipt and application of the proceeds therefrom, (x) no Default has occurred and is continuing and (y) the Fixed Charge Coverage Ratio would be not less than 2.75 to 1.0. Notwithstanding the foregoing, the Company will not permit any Restricted Subsidiary to Incur any Disqualified Stock (other than Disqualified Stock held by the Company or a Subsidiary Guarantor, so long as it is so held).
(2) Notwithstanding the foregoing, the Company and, to the extent provided below, any Restricted Subsidiary may Incur each and all of the following (“Permitted Indebtedness”):
(a) Indebtedness under the Notes (excluding any Additional Notes and any Permitted Pari Passu Secured Indebtedness of the Company) and each Subsidiary Guarantee and JV Subsidiary Guarantee;
(b) any Pari Passu Subsidiary Guarantees by any Subsidiary Guarantor or any JV Subsidiary Guarantor;

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(c) Indebtedness of the Company or any Restricted Subsidiary outstanding on the Original Issue Date excluding Indebtedness permitted under clause (d) below; provided that such Indebtedness of Restricted Subsidiaries that are Non-Guarantor Subsidiaries shall be included in the calculation of Permitted Subsidiary Indebtedness (other than any such Indebtedness excluded from the definition of Permitted Subsidiary Indebtedness by the terms thereof);
(d) Indebtedness of the Company or any Restricted Subsidiary owed to the Company or any Restricted Subsidiary; provided that (i) any event which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness (other than to the Company or any Restricted Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such Indebtedness not permitted by this clause (d) and (ii) if the Company is the obligor on such Indebtedness, such Indebtedness must expressly be subordinated in right of payment to the Notes, and if a Subsidiary Guarantor or a JV Subsidiary Guarantor is the obligor on such Indebtedness and the Company is not the obligee, such Indebtedness must be expressly subordinated in right of payment to the Subsidiary Guarantee of such Subsidiary Guarantor or the JV Subsidiary Guarantee of such JV Subsidiary Guarantor, as the case may be;
(e) Indebtedness (“Permitted Refinancing Indebtedness”) issued in exchange for, or the net proceeds of which are used to refinance or refund, replace, exchange, renew, repay, defease, discharge or extend (collectively, “refinance” and “refinances” and “refinanced” shall have a correlative meaning), then outstanding Indebtedness (or Indebtedness that is no longer outstanding but that is refinanced substantially concurrently with the Incurrence of such Permitted Refinancing Indebtedness) Incurred under the immediately preceding paragraph (1) or clauses (a), (b), (c), (h), (p), (q), (r), (t) or (u) of this paragraph (2) and any refinancings thereof in an amount not to exceed the amount so refinanced (plus premiums, accrued interest, fees and expenses); provided that (i) Indebtedness the proceeds of which are used to refinance the Notes or Indebtedness that is pari passu with, or subordinated in right of payment to, the Notes or a Subsidiary Guarantee or a JV Subsidiary Guarantee shall only be permitted under this clause (e) if (A) in case the Notes are refinanced in part or the Indebtedness to be refinanced is pari passu with the Notes or a Subsidiary Guarantee or a JV Subsidiary Guarantee, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is expressly made pari passu with, or subordinate in right of payment to, the remaining Notes or such Subsidiary Guarantee or such JV Subsidiary Guarantee, as the case may be, or (B) in case the Indebtedness to be refinanced is subordinated in right of payment to the Notes or a Subsidiary Guarantee or a JV Subsidiary Guarantee, such new Indebtedness, by its terms or by the terms of any agreement or instrument pursuant to which such new Indebtedness is issued or remains outstanding, is expressly made subordinate in right of payment to the Notes or such Subsidiary Guarantee or such JV Subsidiary Guarantee, as the case may be, at least to the extent that the Indebtedness to be refinanced is subordinated to the Notes or such Subsidiary Guarantee or such JV Subsidiary Guarantee, (ii) such new Indebtedness, determined as of the date of Incurrence of such new Indebtedness, does not mature prior to the Stated Maturity of the Indebtedness to be refinanced, and the Average Life of such new Indebtedness is at least equal to the remaining Average Life of the Indebtedness to be refinanced, (iii) in no event may Indebtedness of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor be refinanced pursuant to this clause by means of any Indebtedness of any Restricted Subsidiary that is not a Subsidiary Guarantor or a JV Subsidiary Guarantor, and (iv) in no event may Indebtedness of the Company or any Subsidiary Guarantor be refinanced pursuant to this clause by means of any Indebtedness of any JV Subsidiary Guarantor;
(f) Indebtedness Incurred by the Company or any Restricted Subsidiary pursuant to Hedging Obligations designed solely to protect the Company or any Restricted Subsidiary from fluctuations in interest rates, currencies or the price of commodities and not for speculation;
(g) Pre-Registration Mortgage Guarantees by the Company or any Restricted Subsidiary;
(h) Indebtedness Incurred by the Company or any Restricted Subsidiary for the purpose of financing (x) all or any part of the purchase price of assets, real or personal property (including the lease purchase price of land use rights) or equipment to be used in the ordinary

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course of business by the Company or a Restricted Subsidiary in the Permitted Business, including any such purchase through the acquisition of Capital Stock of any Person that owns such real or personal property or equipment which will, upon acquisition, become a Restricted Subsidiary, or (y) all or any part of the purchase price or the cost of development, construction or improvement of assets, real or personal property (including the lease purchase price of land use rights) or equipment to be used in the ordinary course of business by the Company or such Restricted Subsidiary in the Permitted Business; provided that in the case of clauses (x) and (y), (A) the aggregate principal amount of such Indebtedness shall not exceed such purchase price or cost, (B) such Indebtedness shall be Incurred no later than 180 days after the acquisition of such asset, property or equipment or completion of such development, construction or improvement and (C) on the date of the Incurrence of such Indebtedness and after giving effect thereto, the sum of (1) the aggregate principal amount outstanding of all such Indebtedness permitted by this clause (h) (together with refinancings thereof, but excluding any Contractor Guarantee Incurred under this clause (h) to the extent the amount of such Contractor Guarantee is otherwise reflected in such aggregate principal amount) plus (2) the aggregate amount outstanding of all Indebtedness permitted and then outstanding under clauses (p), (q), (r) and (u) below (together with any refinancings thereof) does not exceed an amount equal to 30% of Total Assets;

(i) Indebtedness Incurred by the Company or any Restricted Subsidiary constituting reimbursement obligations with respect to workers’ compensation claims or self-insurance obligations or bid, performance or surety bonds (in each case other than for an obligation for borrowed money);
(j) Indebtedness Incurred by the Company or any Restricted Subsidiary constituting reimbursement obligations with respect to letters of credit or trade guarantees issued in the ordinary course of business to the extent that such letters of credit or trade guarantees are not drawn upon or, if drawn upon, to the extent such drawing is reimbursed no later than the 30 days following receipt by the Company or such Restricted Subsidiary of a demand for reimbursement;
(k) Indebtedness arising from agreements providing for indemnification, adjustment of purchase price or similar obligations, or from Guarantees or letters of credit, surety bonds or performance bonds securing any obligation of the Company or any Restricted Subsidiary pursuant to such agreements, in any case, Incurred in connection with the disposition of any business, assets or Restricted Subsidiary, other than Guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such business, assets or Restricted Subsidiary for the purpose of financing such acquisition; provided that the maximum aggregate liability in respect of all such Indebtedness shall at no time exceed the gross proceeds actually received by the Company or any Restricted Subsidiary from the disposition of such business, assets or Restricted Subsidiary;
(l) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business provided , however , that such Indebtedness is extinguished within five Business Days of Incurrence;
(m) (i) Guarantees by the Company or any Subsidiary Guarantor of Indebtedness of the Company or any Restricted Subsidiary that was permitted to be Incurred by another provision of this covenant (other than Guarantees of such Indebtedness of any Offshore Non-Guarantor Subsidiary), (ii) Guarantees by any Restricted Subsidiary of Indebtedness of another Restricted Subsidiary that was permitted to be Incurred by another provision of this covenant, or (iii) Guarantees by any JV Subsidiary Guarantor of Indebtedness of any other JV Subsidiary Guarantor that is a direct or indirect Subsidiary or parent of such JV Subsidiary Guarantor, which Indebtedness was permitted to be Incurred by another provision of this covenant;
(n) Indebtedness of the Company or any Restricted Subsidiary maturing within one year; provided that the aggregate principal amount of Indebtedness permitted by this clause (n) at any time outstanding does not exceed US$35.0 million (or the Dollar Equivalent thereof);
(o) Indebtedness of the Company or any Restricted Subsidiary constituting an obligation to pay the deferred purchase price of Capital Stock of a Restricted Subsidiary pursuant to a Staged

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Acquisition Agreement, to the extent that such deferred purchase price is paid within 12 months after the date the Company or such Restricted Subsidiary enters into such Staged Acquisition Agreement;

(p) Indebtedness Incurred by the Company or any Restricted Subsidiary arising from any Investment made by a Trust Company Investor in a PRC Project Company; provided that on the date of Incurrence of all such Indebtedness and after giving effect thereto, the sum of (1) the aggregate amount outstanding of all Indebtedness permitted under this clause (p) (together with any refinancings thereof) plus (2) the aggregate principal amount outstanding of all Indebtedness permitted under clause (h) above and clauses (q), (r) and (u) below (together with refinancings thereof, but excluding any Contractor Guarantee Incurred under clause (h) above to the extent the amount of such Contractor Guarantee is otherwise reflected in such aggregate principal amount) does not exceed an amount equal to 30% of Total Assets;
(q) Indebtedness Incurred by any PRC Restricted Subsidiary which is secured by Investment Properties; provided that on the date of the Incurrence of all such Indebtedness and after giving effect thereto, the sum of (1) the aggregate principal amount outstanding of all such Indebtedness Incurred pursuant to this clause (q) (together with any refinancings thereof), plus (2) the aggregate principal amount outstanding of all such Indebtedness Incurred pursuant to clauses (h) and (p) above and clauses (r) and (u) below (together with any refinancings thereof, but excluding any Contractor Guarantee Incurred under clause (h) above to the extent the amount of such Contractor Guarantee is otherwise reflected in such aggregate principal amount), does not exceed an amount equal to 30% of Total Assets;
(r) Bank Deposit Secured Indebtedness Incurred by the Company or any Restricted Subsidiary; provided that on the date of the Incurrence of such Indebtedness and after giving effect thereto, the sum of (1) the aggregate principal amount outstanding of all such Indebtedness Incurred pursuant to this clause (r) (together with any refinancings thereof), plus (2) the aggregate principal amount outstanding of all such Indebtedness Incurred pursuant to clauses (h), (p) and (q) above and (u) below (together with any refinancings thereof, but excluding any Contractor Guarantee Incurred under clause (h) above to the extent the amount of such Contractor Guarantee is otherwise reflected in such aggregate principal amount), does not exceed an amount equal to 30% of Total Assets;
(s) Indebtedness Incurred by the Company or a Restricted Subsidiary constituting a Subordinated Shareholder Loan;
(t) Indebtedness of the Company or any Restricted Subsidiary in an aggregate principal amount outstanding at any time (together with refinancings thereof) not to exceed US$25.0 million (or the Dollar Equivalent thereof); and
(u) Indebtedness Incurred by the Company or any Restricted Subsidiary constituting a Guarantee of Indebtedness of any Person (other than the Company or a Restricted Subsidiary) by the Company or such Restricted Subsidiary; provided that on the date of the Incurrence of all such Indebtedness and after giving effect thereto, the sum of (1) the aggregate principal amount of all such Indebtedness Incurred under this clause (u) (together with any refinancings thereof), plus (2) the aggregate principal amount outstanding of Indebtedness that was permitted to be Incurred under clauses (h), (p), (q) and (r) above (together with any refinancings thereof, but excluding any Contractor Guarantee Incurred under clause (h) above to the extent the amount of such Contractor Guarantee is otherwise reflected in such aggregate principal amount), does not exceed an amount equal to 30% of Total Assets.
(3) For purposes of determining compliance with this “Limitation on Indebtedness and Preferred Stock” covenant, in the event that an item of Indebtedness meets the criteria of more than one of the types of Indebtedness described above, including under the proviso in paragraph (1) above, the Company, in its sole discretion, shall classify, and from time to time may reclassify, such item of Indebtedness as one or more of such types.
(4) Notwithstanding any other provision of this covenant, the maximum amount of Indebtedness that may be Incurred pursuant to this covenant will not be deemed to be exceeded with respect to any outstanding Indebtedness due solely to the result of fluctuations in the exchange rates of currencies.

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Limitation on Restricted Payments

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly (the payments or any other actions described in clauses (1) through (4) below being collectively referred to as “Restricted Payments”):

(1) declare or pay any dividend or make any distribution on or with respect to the Company’s or any Restricted Subsidiary’s Capital Stock (other than dividends or distributions payable or paid in shares of the Company’s or any Restricted Subsidiary’s Capital Stock (other than Disqualified Stock or Preferred Stock) or in options, warrants or other rights to acquire shares of such Capital Stock) held by Persons other than the Company or any Restricted Subsidiary;
(2) purchase, call for redemption or redeem, retire or otherwise acquire for value any shares of Capital Stock of the Company or any Restricted Subsidiary (including options, warrants or other rights to acquire such shares of Capital Stock) or any direct or indirect parent of the Company held by any Persons other than the Company or any Restricted Subsidiary other than the purchase of Capital Stock of a Restricted Subsidiary pursuant to a Staged Acquisition Agreement;
(3) make any voluntary or optional principal payment, or voluntary or optional redemption, repurchase, defeasance, or other acquisition or retirement for value, of Indebtedness that is subordinated in right of payment to the Notes or any Subsidiary Guarantee or JV Subsidiary Guarantee (excluding any intercompany Indebtedness between or among the Company and any Restricted Subsidiary); or
(4) make any Investment, other than a Permitted Investment;

if, at the time of, and after giving effect to, the proposed Restricted Payment:

(a) a Default has occurred and is continuing or would occur as a result of such Restricted Payment;
(b) the Company could not Incur at least US$1.00 of Indebtedness under the proviso in paragraph (1) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”; or
(c) such Restricted Payment, together with the aggregate amount of all Restricted Payments made by the Company and its Restricted Subsidiaries after the Measurement Date (excluding Restricted Payments permitted by clauses (2), (3), (4), (6), (7), (8), (9) and (10) of the immediately following paragraph), shall exceed the sum (without duplication) of:
(i) 50% of the aggregate amount of the Consolidated Net Income of the Company (or, if the Consolidated Net Income is a loss, minus 100% of the amount of such loss) accrued on a cumulative basis during the period (taken as one accounting period) beginning on January 1, 2012 and ending on the last day of the Company’s most recently ended fiscal quarter for which consolidated financial statements of the Company (which the Company shall use its reasonable best efforts to compile in a timely manner) are available (which may include internal consolidated financial statements); plus
(ii) 100% of the aggregate Net Cash Proceeds received by the Company after the Measurement Date a capital contribution to its common equity or from the issuance and sale of its Capital Stock (other than Disqualified Stock) to a Person who is not a Subsidiary of the Company, including any such Net Cash Proceeds received upon (A) the conversion of any Indebtedness (other than Subordinated Indebtedness) of the Company into Capital Stock (other than Disqualified Stock) of the Company, or (B) the exercise by a Person who is not a Subsidiary of the Company of any options, warrants or other rights to acquire Capital Stock of the Company (other than Disqualified Stock) in each case excluding the amount of any such Net Cash Proceeds used to redeem, repurchase, defease or otherwise acquire or retire for value any Subordinated Indebtedness or Capital Stock of the Company; plus
(iii) the amount by which Indebtedness of the Company or any Restricted Subsidiary is reduced on the Company’s consolidated statement of financial position upon the

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conversion or exchange (other than by a Subsidiary of the Company) subsequent to the Measurement Date of any Indebtedness of the Company or any Restricted Subsidiary convertible or exchangeable into Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash, or the Fair Market Value of any other property, distributed by the Company upon such conversion or exchange); plus

(iv) an amount equal to the net reduction in Investments (other than reductions in Permitted Investments) that were made after the Measurement Date in any Person resulting from (A) payments of interest on Indebtedness, dividends or repayments of loans or advances by such Person, in each case to the Company or any Restricted Subsidiary (except, in each case, to the extent any such payment or proceeds are included in the calculation of Consolidated Net Income) after the Measurement Date, (B) the unconditional release of a Guarantee provided by the Company or a Restricted Subsidiary after the Measurement Date of an obligation of another Person, (C) to the extent that an Investment made after the Measurement Date was, after such date, or is sold or otherwise liquidated or repaid for cash, the lesser of (x) cash return of capital with respect to such Investment (less the cost of disposition, if any) and (y) the initial amount of such Investment, or (D) from redesignations of Unrestricted Subsidiaries as Restricted Subsidiaries, not to exceed, in each case, the amount of Investments (other than Permitted Investments) made by the Company or a Restricted Subsidiary after the Measurement Date in any such Person; plus
(v) US$20.0 million (or the Dollar Equivalent thereof).

The foregoing provision shall not be violated by reason of:

(1) the payment of any dividend or redemption of any Capital Stock within 60 days after the related date of declaration or call for redemption if, at said date of declaration or call for redemption, such payment or redemption would comply with the preceding paragraph;
(2) the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of the Company or any Subsidiary Guarantor or JV Subsidiary Guarantor with the Net Cash Proceeds of, or in exchange for, a substantially concurrent Incurrence of Permitted Refinancing Indebtedness;
(3) the redemption, repurchase or other acquisition of Capital Stock of the Company or any Subsidiary Guarantor or JV Subsidiary Guarantor (or options, warrants or other rights to acquire such Capital Stock) in exchange for, or out of the Net Cash Proceeds of a substantially concurrent capital contribution or a sale (other than to a Subsidiary of the Company) of, shares of Capital Stock (other than Disqualified Stock) of the Company, or for the redemption, repurchase or other acquisition of Capital Stock of any Subsidiary Guarantor only, of any Subsidiary Guarantor, or for the redemption, repurchase or other acquisition of Capital Stock of any JV Subsidiary Guarantor only, of any JV Subsidiary Guarantor (or options, warrants or other rights to acquire such Capital Stock); provided that the amount of any such Net Cash Proceeds that are utilized for any such Restricted Payment will be excluded from clause (c)(ii) of the preceding paragraph;
(4) the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of the Company or any Subsidiary Guarantor or JV Subsidiary Guarantor in exchange for, or out of the Net Cash Proceeds of, a substantially concurrent capital contribution or sale (other than to a Subsidiary of the Company) of, shares of Capital Stock (other than Disqualified Stock) of the Company, or for the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of any Subsidiary Guarantor only, of any Subsidiary Guarantor, or for the redemption, repurchase, defeasance or other acquisition or retirement for value of Subordinated Indebtedness of any JV Subsidiary Guarantor only, of any JV Subsidiary Guarantor (or options, warrants or other rights to acquire such Capital Stock); provided that the amount of any such Net Cash Proceeds that are utilized for any such Restricted Payment will be excluded from clause (c)(ii) of the preceding paragraph;
(5) the payment of any dividends or distributions declared, paid or made by a Restricted Subsidiary payable, on a pro rata basis or on a basis more favorable to the Company, to all holders of any class of Capital Stock of such Restricted Subsidiary, a majority of which is held, directly or indirectly through Restricted Subsidiaries, by the Company;

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(6) payments made under a Staged Acquisition Agreement to acquire the Capital Stock of a Person, provided that such Person becomes a Restricted Subsidiary on or before the last date in the period stipulated in such Staged Acquisition Agreement for which the purchase price can be made (such date not to exceed 12 months from the date the Staged Acquisition Agreement was entered into) (the “Deadline Date”); provided further that in the event such Person does not become a Restricted Subsidiary on or before the Deadline Date, all payments previously made under this clause (6) shall be aggregated and constitute Restricted Payments made on the Deadline Date and such Restricted Payments must satisfy the other conditions under this “Limitations on Restricted Payments” covenant;
(7) the repurchase, redemption or other acquisition of Capital Stock of the Company from employees, former employees, directors or former directors of the Company or any Restricted Subsidiary (or their estate or authorized representatives) upon the death, disability or termination of employment of such employees or directors pursuant to agreements or plans (including employment agreements and share option plans) approved by the board of directors of the Company in an aggregate amount not to exceed US$1.0 million (or the Dollar Equivalent thereof) in any fiscal year of the Company;
(8) repurchases of Capital Stock deemed to occur upon the exercise of stock options if such Capital Stock represents a portion of the exercise price thereof;
(9) dividends paid to, or the purchase of Capital Stock of any PRC Project Company held by, any Trust Company Investor in respect of any Indebtedness permitted to be Incurred under clause (p) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”; or
(10) an Investment in the Capital Stock of a Restricted Subsidiary held by a minority shareholder which Investment increases the proportion of the Capital Stock of such Restricted Subsidiary held, directly or indirectly, by the Company;

provided that, in the case of clause (2), (3) or (4) of the preceding paragraph, no Default shall have occurred and be continuing or would occur as a consequence of the actions or payments set forth therein.

The amount of any Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or the Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The value of any assets or securities that are required to be valued by this covenant will be the Fair Market Value. The Board of Directors’ determination of the Fair Market Value of a Restricted Payment or any such assets or securities must be based upon an opinion or appraisal issued by an appraisal or investment banking firm of recognized international standing if the Fair Market Value exceeds US$10.0 million (or the Dollar Equivalent thereof).

Not later than the date of making any Restricted Payment in excess of US$10.0 million (or the Dollar Equivalent thereof), the Company will deliver to the Trustee an Officers’ Certificate stating that such Restricted Payment is permitted and setting forth the basis upon which the calculations required by this “– Limitation on Restricted Payments” covenant were computed, together with a copy of any fairness opinion or appraisal required by the Indenture.

Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries

(1) Except as provided below, the Company will not, and will not permit any Restricted Subsidiary to, create or otherwise cause or permit to exist or become effective any encumbrance or restriction on the ability of any Restricted Subsidiary to:
(a) pay dividends or make any other distribution on any Capital Stock of such Restricted Subsidiary owned by the Company or any other Restricted Subsidiary;
(b) pay any Indebtedness or other obligation owed to the Company or any other Restricted Subsidiary;
(c) make loans or advances to the Company or any other Restricted Subsidiary; or
(d) sell, lease or transfer any of its property or assets to the Company or any other Restricted Subsidiary;

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provided that for the avoidance of doubt the following shall not be deemed to constitute such an encumbrance or restriction: (i) the priority of any Preferred Stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on Common Stock; (ii) the subordination of loans or advances made to the Company or any Restricted Subsidiary to other Indebtedness Incurred by the Company or any Restricted Subsidiary; and (iii) the provisions contained in documentation governing Indebtedness requiring transactions between or among the Company and any Restricted Subsidiary or between or among any Restricted Subsidiary to be on fair and reasonable terms or on an arm’s length basis.

(2) The provisions of paragraph (1) do not apply to any encumbrances or restrictions:
(a) existing in agreements as in effect on the Original Issue Date, or in the Notes, the Subsidiary Guarantees, the JV Subsidiary Guarantees, the Indenture, the Security Documents, or under any Permitted Pari Passu Secured Indebtedness of the Company or any Subsidiary Guarantor Pledgor or Pari Passu Subsidiary Guarantee of any Subsidiary Guarantor or any JV Subsidiary Guarantor, and any extensions, refinancings, renewals or replacements of any of the foregoing agreements; provided that the encumbrances and restrictions in any such extension, refinancing, renewal or replacement, taken as a whole, are no more restrictive in any material respect to the Holders than those encumbrances or restrictions that are then in effect and that are being extended, refinanced, renewed or replaced;
(b) existing under or by reason of applicable law, rule, regulation or order;
(c) with respect to any Person or the property or assets of such Person acquired by the Company or any Restricted Subsidiary, existing at the time of such acquisition and not incurred in contemplation thereof, which encumbrances or restrictions are not applicable to any Person or the property or assets of any Person other than such Person or the property or assets of such Person so acquired, and any extensions, refinancings, renewals or replacements thereof; provided that the encumbrances and restrictions in any such extension, refinancing, renewal or replacement, taken as a whole, are no more restrictive in any material respect to the Holders than those encumbrances or restrictions that are then in effect and that are being extended, refinanced, renewed or replaced;
(d) that otherwise would be prohibited by the provision described in clause (1)(d) of this covenant if they arise, or are agreed to, in the ordinary course of business and, that (i) restrict in a customary manner the subletting, assignment or transfer of any property or asset that is subject to a lease or license, (ii) exist by virtue of any Lien on, or agreement to transfer, option or similar right with respect to any property or assets of the Company or any Restricted Subsidiary not otherwise prohibited by the Indenture or (iii) do not relate to any Indebtedness, and that do not, individually or in the aggregate, detract from the value of property or assets of the Company or any Restricted Subsidiary in any manner material to the Company or any Restricted Subsidiary;
(e) with respect to a Restricted Subsidiary and imposed pursuant to an agreement that has been entered into for the sale or disposition of all or substantially all of the Capital Stock of, or property and assets of, such Restricted Subsidiary that is permitted by the “– Limitation on Sales and Issuances of Capital Stock in Restricted Subsidiaries,” “– Limitation on Indebtedness and Preferred Stock” and “– Limitation on Asset Sales” covenants;
(f) with respect to any Restricted Subsidiary and imposed pursuant to an agreement that has been entered into for the Incurrence of Indebtedness of the type described under clause (2)(h), (2)(n), (2)(o), (2)(p), (2)(q), (2)(r), (2)(t) or 2(u) of the “– Limitation on Indebtedness and Preferred Stock” covenant if, as determined by the Board of Directors, the encumbrances or restrictions are (i) customary for such types of agreements and (ii) would not, at the time agreed to, be expected to materially and adversely affect the ability of the Company to make required payment on the Notes and any extensions, refinancings, renewals or replacements of any of the foregoing agreements; provided that the encumbrances and restrictions in any such extension, refinancing, renewal or replacement, taken as a whole, are no more restrictive in any material respect to the Holders than those encumbrances or restrictions that are then in effect and that are being extended, refinanced, renewed or replaced;

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(g) existing in customary provisions in joint venture agreements and other similar agreements, to the extent such encumbrance or restriction relates to the activities or assets of the Company or a Restricted Subsidiary that is a party to such joint venture and if (as determined in good faith by the Board of Directors) (i) the encumbrances or restrictions are customary for a joint venture or similar agreement of that type and (ii) the encumbrances or restrictions would not, at the time agreed to, be expected to materially and adversely affect (x) the ability of the Company to make the required payments on the Notes, or (y) any Subsidiary Guarantor or JV Subsidiary Guarantor to make required payments under its Subsidiary Guarantee or JV Subsidiary Guarantee; or
(h) existing with respect to any Unrestricted Subsidiary or the property or assets of such Unrestricted Subsidiary that is designated as a Restricted Subsidiary in accordance with the terms of the Indenture at the time of such designation and not incurred in contemplation of such designation, which encumbrances or restrictions are not applicable to any Person or the property or assets of any Person other than such Subsidiary or its subsidiaries or the property or assets of such Subsidiary or its subsidiaries, and any extensions, refinancing, renewals or replacements thereof; provided that the encumbrances and restrictions in any such extension, refinancing, renewal or replacement, taken as a whole, are no more restrictive in any material respect to the Holders than those encumbrances or restrictions that are then in effect and that are being extended, refinanced, renewed or replaced.

Limitation on Sales and Issuances of Capital Stock in Restricted Subsidiaries

The Company will not sell, and will not permit any Restricted Subsidiary, directly or indirectly, to issue or sell any shares of Capital Stock of a Restricted Subsidiary (including options, warrants or other rights to purchase shares of such Capital Stock) except:

(1) to the Company or a Wholly Owned Restricted Subsidiary, or in the case of a Restricted Subsidiary that is not Wholly Owned, pro rata to its shareholders or incorporators or on a basis more favorable to the Company and its Restricted Subsidiaries;
(2) to the extent such Capital Stock represents director’s qualifying shares or is required by applicable law to be held by a Person other than the Company or a Wholly Owned Restricted Subsidiary;
(3) the sale or issuance of Capital Stock of a Restricted Subsidiary if, immediately after giving effect to such sale or issuance, such Restricted Subsidiary would no longer constitute a Restricted Subsidiary and any remaining Investment in such Person would have been permitted to be made under the “Limitation on Restricted Payments” covenant if made on the date of such sale or issuance and provided that the Company complies with the “– Limitation on Asset Sales” covenant; or
(4) the issuance or sale of Capital Stock of a Restricted Subsidiary (which remains a Restricted Subsidiary after any such issuance or sale); provided that the Company or such Restricted Subsidiary applies the Net Cash Proceeds of such issuance or sale in accordance with the “– Limitation on Asset Sales” covenant.

Limitation on Issuances of Guarantees by Restricted Subsidiaries

The Company will not permit any Restricted Subsidiary which is not a Subsidiary Guarantor or a JV Subsidiary Guarantor, directly or indirectly, to Guarantee any Indebtedness (“Guaranteed Indebtedness”) of the Company or any other Restricted Subsidiary, unless (1)(a) such Restricted Subsidiary simultaneously executes and delivers a supplemental indenture to the Indenture providing for an unsubordinated Subsidiary Guarantee (in the case of a Subsidiary Guarantor) or JV Subsidiary Guarantee (in the case of a JV Subsidiary Guarantor) of payment of the Notes by such Restricted Subsidiary and (b) such Restricted Subsidiary waives and will not in any manner whatsoever claim or take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or any other rights against the Company or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary under its Subsidiary Guarantee or JV Subsidiary Guarantee, as the case may be, until the Notes have been paid in full or (2) such Guarantee are permitted by clauses (2)(c), (d), (m)(ii) (other than a Guarantee by a PRC Restricted Subsidiary of the Indebtedness of a non-PRC Restricted Subsidiary) or (r) (in the case of (2)(r), with respect to the Guarantee provided by any Restricted Subsidiary that is not Subsidiary Guarantor through the pledge of one or more bank accounts to secure, directly, or indirectly, any Bank Deposit Secured Indebtedness of the Company or any Subsidiary Guarantor), under the “– Limitation on Indebtedness and Preferred Stock” covenant.

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If the Guaranteed Indebtedness (1) ranks pari passu in right of payment with the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee, then the Guarantee of such Guaranteed Indebtedness shall rank pari passu in right of payment with, or subordinated to, the Subsidiary Guarantee or the JV Subsidiary Guarantee, as the case may be, or (2) is subordinated in right of payment to the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee, then the Guarantee of such Guaranteed Indebtedness shall be subordinated in right of payment to the Subsidiary Guarantee or the JV Subsidiary Guarantee, as the case may be, at least to the extent that the Guaranteed Indebtedness is subordinated to the Notes, the Subsidiary Guarantee or the JV Subsidiary Guarantee.

The Company will not permit any JV Subsidiary Guarantor, directly or indirectly, to Guarantee any Indebtedness of the Company or any Restricted Subsidiary unless the aggregate claims of the creditor under such Guarantee will be limited to the JV Entitlement Amount. If any JV Subsidiary Guarantor Guarantees any Indebtedness of the Company or any Restricted Subsidiary where the aggregate claims of the creditor under such Guarantee exceeds the JV Entitlement Amount, such JV Subsidiary Guarantee shall be replaced with a Subsidiary Guarantee given by a Subsidiary Guarantor.

Limitation on Transactions with Shareholders and Affiliates

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, enter into, renew or extend any transaction or arrangement (including, without limitation, the purchase, sale, lease or exchange of property or assets, or the rendering of any service) with (x) any holder (or any Affiliate of such holder) of 10.0% or more of any class of Capital Stock of the Company or (y) any Affiliate of the Company (each an “Affiliate Transaction”), unless:

(1) the Affiliate Transaction is on fair and reasonable terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable arm’s length transaction by the Company or the relevant Restricted Subsidiary with a Person that is not an Affiliate of the Company; and
(2) the Company delivers to the Trustee:
(a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$5.0 million (or the Dollar Equivalent thereof), a Board Resolution set forth in an Officers’ Certificate certifying that such Affiliate Transaction complies with this covenant and such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors; and
(b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$10.0 million (or the Dollar Equivalent thereof), in addition to the Board Resolution required in clause 2(a) above, an opinion as to the fairness to the Company or the relevant Restricted Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of recognized international standing.

The foregoing limitation does not limit, and shall not apply to:

(1) the payment of reasonable and customary regular fees to directors of the Company who are not employees of the Company;
(2) transactions between or among the Company and any of its Wholly Owned Restricted Subsidiaries or between or among Wholly Owned Restricted Subsidiaries;
(3) any Restricted Payment of the type described in clauses (1) or (2) of the first paragraph of the covenant described under the caption “– Limitation on Restricted Payments” if permitted by that covenant;
(4) any sale of Capital Stock (other than Disqualified Stock) of the Company;
(5) the payment of compensation to officers and directors of the Company or any Restricted Subsidiary pursuant to an employee benefit, or share option or similar schemes, for so long as such scheme is in compliance with the listing rules of The Stock Exchange of Hong Kong Limited, which as of the Original Issue Date require a majority shareholder approval of any such scheme;

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(6) loans or advances to employees, officers or directors in the ordinary course of business not to exceed US$5.0 million in the aggregate at any one time outstanding;
(7) any employment, consulting, service or termination agreement, or reasonable and customary indemnification arrangements, entered into by the Company or any of its Restricted Subsidiaries with directors, officers, employees and consultants in the ordinary course of business and the payment of compensation pursuant thereto; and
(8) any sale of apartment units by the Company or a Restricted Subsidiary in the ordinary course of business to employees, officers, directors or their respective family members at a discount from the listed price not greater than that applicable generally to all employees of the Company and its Subsidiaries with respect to those apartment units; provided that (x) revenues from all such sales in any fiscal year shall not exceed 2.0% of the revenues for that year as shown in the consolidated financial statements of the Company for that period in accordance with GAAP, and (y) any such discount shall not be in excess of 15.0% of the Fair Market Value of the relevant apartment unit.

In addition, the requirements of clause (2) of the first paragraph of this covenant shall not apply to (i) Investments (other than Permitted Investments) not prohibited by the “– Limitation on Restricted Payments” covenant, (ii) transactions pursuant to agreements in effect on the Original Issue Date and described in this offering memorandum, or any amendment or modification or replacement thereof, so long as such amendment, modification or replacement is not more disadvantageous to the Company and its Restricted Subsidiaries than the original agreement in effect on the Original Issue Date and (iii) any transaction between or among (A) the Company, any Wholly Owned Restricted Subsidiary and any Restricted Subsidiary that is not a Wholly Owned Restricted Subsidiary or between or among Restricted Subsidiaries that are not Wholly Owned Restricted Subsidiaries or (B) the Company or a Restricted Subsidiary and any Minority Joint Venture; provided that in the case of clause (iii) (a) such transaction is entered into in the ordinary course of business and (b) none of the minority or other shareholders or minority or other partners of or in such Restricted Subsidiary that is not a Wholly Owned Restricted Subsidiary or Minority Joint Venture, as the case may be, is a Person described in clauses (x) or (y) of the first paragraph of this covenant (other than by reason of such minority or other shareholder or minority or other partner being an officer or director of such Restricted Subsidiary or Minority Joint Venture, as the case may be).

Limitation on Liens

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur, assume or permit to exist any Lien on the Collateral (other than Permitted Liens).

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur, assume or permit to exist any Lien of any nature whatsoever on any of its assets or properties of any kind (other than the Collateral), whether owned at the Original Issue Date or thereafter acquired, except Permitted Liens, unless the Notes are secured equally and ratably with (or, if the obligation or liability to be secured by such Lien is subordinated in right of payment to the Notes, prior to) the obligation or liability secured by such Lien, for so long as such obligation or liability is secured by such Lien.

Limitation on Sale and Leaseback Transactions

The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction; provided that the Company or any Restricted Subsidiary may enter into a Sale and Leaseback Transaction if:

(1) the Company or such Restricted Subsidiary could have (a) incurred Indebtedness in an amount equal to the Attributable Indebtedness relating to such Sale and Leaseback Transaction under paragraph (1) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock” and (b) incurred a Lien to secure such Indebtedness pursuant to the covenant described under the caption “– Limitation on Liens,” in which case, the corresponding Indebtedness and Lien will be deemed incurred pursuant to those provisions;
(2) the gross cash proceeds of such Sale and Leaseback Transaction are at least equal to the Fair Market Value of the property that is the subject of such Sale and Leaseback Transaction; and
(3) the transfer of assets in such Sale and Leaseback Transaction is permitted by, and the Company or such Restricted Subsidiary applies the proceeds of such transaction in compliance with, the covenant described under the caption “– Limitation on Asset Sales.”

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Limitation on Asset Sales

The Company will not, and will not permit any Restricted Subsidiary to, consummate any Asset Sale, unless:

(1) no Default shall have occurred and be continuing or would occur as a result of such Asset Sale;
(2) the consideration received by the Company or such Restricted Subsidiary, as the case may be, is at least equal to the Fair Market Value of the assets sold or disposed of;
(3) in the case of an Asset Sale that constitutes an Asset Disposition, the Company could Incur, at the time of and after giving pro forma effect to such Asset Disposition, at least US$1.00 of Indebtedness under the proviso in paragraph (1) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”; and
(4) at least 75% of the consideration received consists of cash, Temporary Cash Investments or Replacement Assets; provided that in the case of an Asset Sale in which the Company or such Restricted Subsidiary receives Replacement Assets involving aggregate consideration in excess of US$10.0 million (or the Dollar Equivalent thereof), the Company shall deliver to the Trustee an opinion as to the fairness to the Company or such Restricted Subsidiary of such Asset Sale from a financial point of view issued by an accounting, appraisal or investment banking firm of recognized international standing. For purposes of this provision, each of the following will be deemed to be cash:
(a) any liabilities, as shown on the Company’s most recent consolidated statement of financial position, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee) that are assumed by the transferee of any such assets pursuant to a customary assumption, assignment, novation or similar agreement that releases the Company or such Restricted Subsidiary from further liability; and
(b) any securities, notes or other obligations received by the Company or any Restricted Subsidiary from such transferee that are promptly, but in any event within 30 days of closing, converted by the Company or such Restricted Subsidiary into cash, to the extent of the cash received in that conversion;

Within 360 days after the receipt of any Net Cash Proceeds from an Asset Sale, the Company (or any Restricted Subsidiary) may apply such Net Cash Proceeds to:

(1) permanently repay Senior Indebtedness of the Company or a Subsidiary Guarantor or any Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor (and, if such Senior Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto) in each case owing to a Person other than the Company or a Restricted Subsidiary; or
(2) acquire properties and assets that replace the properties and assets that were the subject of such Asset Sale or in properties or assets that will be used in the Permitted Businesses (“Replacement Assets”).

Any Net Cash Proceeds from Asset Sales that are not applied or invested as provided in clauses (1) and (2) in the immediately preceding paragraph will constitute “Excess Proceeds.” Excess Proceeds of less than US$10.0 million (or the Dollar Equivalent thereof) will be carried forward and accumulated. When accumulated Excess Proceeds exceeds US$10.0 million (or the Dollar Equivalent thereof), within 10 days thereof, the Company must make an Offer to Purchase Notes having a principal amount equal to:

(1) accumulated Excess Proceeds, multiplied by
(2) a fraction (x) the numerator of which is equal to the outstanding principal amount of the Notes and (y) the denominator of which is equal to the outstanding principal amount of the Notes and all pari passu Indebtedness similarly required to be repaid, redeemed or tendered for in connection with the Asset Sale,

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rounded down to the nearest US$1,000.

The offer price in any Offer to Purchase will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase, and will be payable in cash.

If any Excess Proceeds remain after consummation of an Offer to Purchase, the Company may use such Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes (and any other pari passu Indebtedness) tendered in (or required to be prepaid or redeemed in connection with) such Offer to Purchase exceeds the amount of Excess Proceeds, the Trustee will select the Notes (and such other pari passu Indebtedness) to be purchased on a pro rata basis based on the principal amount of Notes and such other pari passu Indebtedness tendered (or required to be prepaid or redeemed). Upon completion of each Offer to Purchase, the amount of Excess Proceeds will be reset at zero.

Limitation on the Company’s Business Activities

The Company will not, and will not permit any Restricted Subsidiary to, directly or indirectly, engage in any business other than Permitted Businesses; provided , however , that the Company or any Restricted Subsidiary may own Capital Stock of an Unrestricted Subsidiary or joint venture or other entity that is engaged in a business other than Permitted Businesses as long as any Investment therein was not prohibited when made by the covenant described under the caption “– Limitation on Restricted Payments.”

Use of Proceeds

The Company will not, and will not permit any Restricted Subsidiary to, use the net proceeds from the sale of the Notes, in any amount, for any purpose other than (1) in the approximate amounts and for the purposes specified, including any adjustment in response to changes in acquisition or development plans as contemplated, under the caption “Use of Proceeds” in this offering memorandum (or in the case of Additional Notes, the offering memorandum relating to the sale of such Additional Notes) and (2) pending the application of all of such net proceeds in such manner, to invest the portion of such net proceeds not yet so applied in Temporary Cash Investments.

Designation of Restricted and Unrestricted Subsidiaries

The Board of Directors may designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided that (1) no Default shall have occurred and be continuing at the time of or after giving effect to such designation; (2) neither the Company nor any Restricted Subsidiary provides credit support for the Indebtedness of such Restricted Subsidiary; (3) such Restricted Subsidiary does not own any Disqualified Stock of the Company or Disqualified or Preferred Stock of another Restricted Subsidiary or hold any Indebtedness of, or any Lien on any property of, the Company or any Restricted Subsidiary, if such Disqualified or Preferred Stock or Indebtedness could not be Incurred under the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock” or such Lien would violate the covenant described under the caption “– Limitation on Liens;” (4) such Restricted Subsidiary does not own any Voting Stock of another Restricted Subsidiary, and all of its Subsidiaries are Unrestricted Subsidiaries or are being concurrently designated to be Unrestricted Subsidiaries in accordance with this paragraph; and (5) the Investment deemed to have been made thereby in such newly-designated Unrestricted Subsidiary and each other newly-designated Unrestricted Subsidiary being concurrently redesignated would be permitted to be made by the covenant described under the caption “– Limitation on Restricted Payments.”

The Board of Directors may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (1) no Default shall have occurred and be continuing at the time of or after giving effect to such designation; (2) any Indebtedness of such Unrestricted Subsidiary outstanding at the time of such designation which will be deemed to have been Incurred by such newly-designated Restricted Subsidiary as a result of such designation would be permitted to be Incurred by the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock;” (3) any Lien on the property of such Unrestricted Subsidiary at the time of such designation which will be deemed to have been incurred by such newly-designated Restricted Subsidiary as a result of such designation would be permitted to be incurred by the covenant described under the caption “– Limitation on Liens;” (4) such Unrestricted Subsidiary is not a Subsidiary of another Unrestricted Subsidiary (that is not concurrently being designated as a Restricted Subsidiary); (5) if such Restricted Subsidiary is not organized under the laws of the PRC and is not an Offshore Non-Guarantor Subsidiary, such Restricted Subsidiary shall upon such designation execute and deliver to the Trustee a supplemental indenture to the

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Indenture by which such Restricted Subsidiary shall become a Subsidiary Guarantor or a JV Subsidiary Guarantor in accordance with the terms under the Indenture; and (6) if such Restricted Subsidiary is not organized under the laws of the PRC and is not an Offshore Non-Guarantor Subsidiary or a subsidiary of a JV Subsidiary Guarantor, all Capital Stock of such Restricted Subsidiary owned by the Company or any other Restricted Subsidiary shall be pledged as required under “– Security”.

Government Approvals and Licenses; Compliance with Law

The Company will, and will cause each Restricted Subsidiary to, (1) obtain and maintain in full force and effect all governmental approvals, authorizations, consents, permits, concessions and licenses as are necessary to engage in the Permitted Businesses; (2) preserve and maintain good and valid title to its properties and assets (including land-use rights) free and clear of any Liens other than Permitted Liens; and (3) comply with all laws, regulations, orders, judgments and decrees of any governmental body, except to the extent that failure so to obtain, maintain, preserve and comply would not reasonably be expected to have a material adverse effect on (a) the business, results of operations or prospects of the Company and its Restricted Subsidiaries, taken as a whole, or (b) the ability of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor to perform its obligations under the Notes, the relevant Subsidiary Guarantee, the relevant JV Subsidiary Guarantee or the Indenture.

Anti-Layering

The Company will not Incur, and will not permit any Subsidiary Guarantor or JV Subsidiary Guarantor to Incur, any Indebtedness if such Indebtedness is contractually subordinated in right of payment to any other Indebtedness of the Company, such Subsidiary Guarantor or such JV Subsidiary Guarantor, as the case may be, unless such Indebtedness is also contractually subordinated in right of payment to the Notes, the applicable Subsidiary Guarantee or the applicable JV Subsidiary Guarantee, on substantially identical terms. This does not apply to distinctions between categories of Indebtedness that exist by reason of any Liens or Guarantees securing or in favor of some but not all of such Indebtedness.

Suspension of Certain Covenants

If, on any date following the date of the Indenture, the Notes have a rating of Investment Grade from both of the Rating Agencies and no Default has occurred and is continuing (a “Suspension Event”), then, beginning on that day and continuing until such time, if any, at which the Notes cease to have a rating of Investment Grade from either of the Rating Agencies, the provisions of the Indenture summarized under the following captions will be suspended:

(1) “– Certain Covenants – Limitation on Indebtedness and Preferred Stock”;
(2) “– Certain Covenants – Limitation on Restricted Payments”;
(3) “– Certain Covenants – Limitation on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries”;
(4) “– Certain Covenants – Limitation on Sales and Issuances of Capital Stock in Restricted Subsidiaries”;
(5) “– Certain Covenants – Limitation on Issuances of Guarantees by Restricted Subsidiaries”;
(6) “– Certain Covenants – Limitation on the Company’s Business Activities;
(7) “– Certain Covenants – Limitation on Sale and Leaseback Transactions”; and
(8) “– Certain Covenants – Limitation on Asset Sales”.

During any period that the foregoing covenants have been suspended, the Board of Directors may not designate any Restricted Subsidiary as an Unrestricted Subsidiary pursuant to the covenant described under the caption “– Certain Covenants – Designation of Restricted and Unrestricted Subsidiaries” or the definition of “Unrestricted Subsidiary.”

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Such covenants will be reinstituted and apply according to their terms as of and from the first day on which a Suspension Event ceases to be in effect. Such covenants will not, however, be of any effect with regard to actions of the Company or any Restricted Subsidiary properly taken in compliance with the provisions of the Indenture during the continuance of the Suspension Event, and following reinstatement the calculations under the covenant described under the caption “– Certain Covenants – Limitation on Restricted Payments” will be made as if such covenant had been in effect since the date of the Indenture except that no Default will be deemed to have occurred solely by reason of a Restricted Payment made while that covenant was suspended. There can be no assurance that the Notes will ever achieve a rating of Investment Grade or that any such rating will be maintained.

Provision of Financial Statements and Reports

(1) So long as any of the Notes remain outstanding, the Company will file with the Trustee and furnish to the Holders upon request, as soon as they are available but in any event not more than 10 calendar days after they are filed with The Stock Exchange of Hong Kong Limited or any other recognized securities exchange on which the Company’s ordinary shares are at any time listed for trading, true and correct copies of any financial or other report in the English language filed with such exchange; provided that if at any time the Common Stock of the Company ceases to be listed for trading on a recognized securities exchange, the Company will file with the Trustee and furnish to the Holders:
(a) as soon as they are available, but in any event within 90 calendar days after the end of the fiscal year of the Company, copies of its financial statements (on a consolidated basis and in the English language) in respect of such financial year (including a statement of income, statement of financial position and cash flow statement) audited by a member firm of an internationally-recognized firm of independent accountants;
(b) as soon as they are available, but in any event within 45 calendar days after the end of the second fiscal quarter of the Company, copies of its financial statements (on a consolidated basis and in the English language) in respect of such half-year period (including a statement of income, statement of financial position and cash flow statement) reviewed by a member firm of an internationally-recognized firm of independent accountants; and
(c) as soon as they are available, but in any event within 45 calendar days after the end of each of the first and third fiscal quarters of the Company, copies of its unaudited financial statements (on a consolidated basis and in the English language), including a statement of income, statement of financial position and cash flow statement, prepared on a basis consistent with the audited financial statements of the Company together with a certificate signed by the person then authorized to sign financial statements on behalf of the Company to the effect that such financial statements are true in all material respects and present fairly the financial position of the Company as at the end of, and the results of its operations for, the relevant quarterly period.
(2) In addition, so long as any of the Notes remain outstanding, the Company will provide to the Trustee (a) within 120 days after the close of each fiscal year, an Officers’ Certificate stating the Fixed Charge Coverage Ratio with respect to the four most recent fiscal quarter periods and showing in reasonable detail the calculation of the Fixed Charge Coverage Ratio, including the arithmetic computations of each component of the Fixed Charge Coverage Ratio, with a certificate from the Company’s external auditors verifying the accuracy and correctness of the calculation and arithmetic computation; provided , that, the Company shall not be required to provide such auditor certificate if its external auditors refuse to provide such certificate as a result of a policy of such external auditors; and (b) as soon as possible and in any event within 10 days after the Company becomes aware or should reasonably become aware of the occurrence of a Default, an Officers’ Certificate setting forth the details of the Default, and the action which the Company proposes to take with respect thereto.

Events of Default

The following events will be defined as “Events of Default” in the Indenture:

(1) default in the payment of principal of (or premium, if any, on) the Notes when the same becomes due and payable at maturity, upon acceleration, redemption or otherwise;

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(2) default in the payment of interest on any Note when the same becomes due and payable, and such default continues for a period of 30 consecutive days;
(3) default in the performance or breach of the provisions of the covenants described under the caption “– Consolidation, Merger and Sale of Assets,” the failure by the Company to make or consummate an Offer to Purchase in the manner described under the captions “– Repurchase of Notes upon a Change of Control Triggering Event” or “– Certain Covenants – Limitation on Asset Sales,” or the failure by the Company to create, or cause its Restricted Subsidiaries to create, a Lien on the Collateral (subject to any Permitted Liens and the Intercreditor Agreement) in accordance with the covenant described under the caption “– Security;”
(4) the Company or any Restricted Subsidiary defaults in the performance of or breaches any other covenant or agreement in the Indenture or under the Notes (other than a default specified in clause (1), (2) or (3) above) and such default or breach continues for a period of 30 consecutive days after written notice by the Trustee or the Holders of 25% or more in aggregate principal amount of the Notes;
(5) there occurs with respect to any Indebtedness of the Company or any Restricted Subsidiary having an outstanding principal amount of US$10.0 million (or the Dollar Equivalent thereof) or more in the aggregate for all such Indebtedness of all such Persons, whether such Indebtedness now exists or shall hereafter be created, (a) an event of default that has caused the holder thereof to declare such Indebtedness to be due and payable prior to its Stated Maturity and/or (b) the failure to make a principal payment when due;
(6) one or more final judgments or orders for the payment of money are rendered against the Company or any Restricted Subsidiary and are not paid or discharged, and there is a period of 60 consecutive days following entry of the final judgment or order that causes the aggregate amount for all such final judgments or orders outstanding and not paid or discharged against all such Persons to exceed US$10.0 million (or the Dollar Equivalent thereof) (in excess of amounts which the Company’s insurance carriers have agreed to pay under applicable policies) during which a stay of enforcement, by reason of a pending appeal or otherwise, is not in effect;
(7) an involuntary case or other proceeding is commenced against the Company or any Restricted Subsidiary with respect to it or its debts under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect seeking the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Company or any Restricted Subsidiary or for any substantial part of the property and assets of the Company or any Restricted Subsidiary and such involuntary case or other proceeding remains undismissed and unstayed for a period of 60 consecutive days; or an order for relief is entered against the Company or any Restricted Subsidiary under any applicable bankruptcy, insolvency or other similar law as now or hereafter in effect;
(8) the Company or any Restricted Subsidiary (a) commences a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or consents to the entry of an order for relief in an involuntary case under any such law, (b) consents to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Company or any Restricted Subsidiary or for all or substantially all of the property and assets of the Company or any Restricted Subsidiary or (c) effects any general assignment for the benefit of creditors;
(9) any Subsidiary Guarantor or JV Subsidiary Guarantor denies or disaffirms its obligations under its Subsidiary Guarantee or JV Subsidiary Guarantee or, except as permitted by the Indenture, any Subsidiary Guarantee or JV Subsidiary Guarantee is determined to be unenforceable or invalid or shall for any reason cease to be in full force and effect;
(10) any default by the Company or any Subsidiary Guarantor Pledgor in the performance of any of its obligations under the Security Documents, which adversely affects the enforceability, validity, perfection or priority of the applicable Lien on the Collateral or which adversely affects the condition or value of the Collateral, taken as a whole, in any material respect; or
(11) the Company or any Subsidiary Guarantor Pledgor denies or disaffirms its obligations under any Security Document or, other than in accordance with the Indenture and the Security Documents, any

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Security Document ceases to be or is not in full force and effect or the Trustee ceases to have a security interest in the Collateral (subject to any Permitted Liens and the Intercreditor Agreement).

If an Event of Default (other than an Event of Default specified in clause (7) or (8) above) occurs and is continuing under the Indenture, the Trustee or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding, by written notice to the Company (and to the Trustee if such notice is given by the Holders), may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest on the Notes to be immediately due and payable. Upon a declaration of acceleration, such principal of, premium, if any, and accrued and unpaid interest shall be immediately due and payable. If an Event of Default specified in clause (7) or (8) above occurs with respect to the Company or any Restricted Subsidiary, the principal of, premium, if any, and accrued and unpaid interest on the Notes then outstanding shall automatically become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

The Holders of at least a majority in principal amount of the outstanding Notes by written notice to the Company and to the Trustee may on behalf of the Holders of Notes waive all past defaults and rescind and annul a declaration of acceleration and its consequences if:

(1) all existing Events of Default, other than the nonpayment of the principal of, premium, if any, and interest on the Notes that have become due solely by such declaration of acceleration, have been cured or waived, and
(2) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction.

Upon such waiver, the Default will cease to exist, and any Event of Default arising therefrom will be deemed to have been cured, but no such waiver will extend to any subsequent or other Default or impair any right consequent thereon.

If an Event of Default occurs and is continuing, the Trustee may pursue, in its own name or as trustee of an express trust, any available remedy by proceeding at law or in equity to collect the payment of principal of and interest on the Notes or to enforce the performance of any provision of the Notes or the Indenture, subject to the terms of the Intercreditor Agreement. The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. In addition, if an Event of Default occurs and is continuing, the Trustee may, and shall (subject to being indemnified and/or secured to its satisfaction) upon request of Holders of at least 25% in aggregate principal amount of outstanding Notes, subject to the terms of the Indenture and Intercreditor Agreement, foreclose on the Collateral in accordance with the terms of the Security Documents and take such further action on behalf of the Holders of the Notes with respect to the Collateral as the Trustee deems appropriate, subject to the terms of the Indenture and Intercreditor Agreement. See “– Security.”

The Holders of at least a majority in aggregate principal amount of the outstanding Notes may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law, the Indenture or the Security Documents, that may involve the Trustee in personal liability, or that the Trustee determines in good faith may be unduly prejudicial to the rights of Holders not joining in the giving of such direction and may take any other action it deems proper that is not inconsistent with any such direction received from Holders.

A Holder of Notes may not institute any proceeding, judicial or otherwise, with respect to the Indenture or the Notes, or for the appointment of a receiver or trustee, or for any other remedy under the Indenture or the Notes, unless:

(1) the Holder has previously given the Trustee written notice of a continuing Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of outstanding Notes make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer the Trustee indemnity and/or security satisfactory to the Trustee against any costs, liability or expense to be incurred in compliance with such request;
(4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity and/or security; and

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(5) during such 60-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes do not give the Trustee a written direction that is inconsistent with the request.

However, such limitations do not apply to the right of any Holder to receive payment of the principal of, premium, if any, or interest on, such Note, or to bring suit for the enforcement of any such payment, on or after the due date expressed in the Notes, which right shall not be impaired or affected without the consent of the Holder.

Officers of the Company must certify, on or before a date not more than 120 days after the end of each fiscal year, that a review has been conducted of the activities of the Company and its Restricted Subsidiaries and the Company’s and its Restricted Subsidiaries” performance under the Indenture and the Security Documents that the Company and its Restricted Subsidiaries have fulfilled all obligations thereunder, or, if there has been a default in the fulfillment of any such obligation, specifying each such default and the nature and status thereof. The Company will also be obligated to notify the Trustee in writing of any default or defaults in the performance of any covenants or agreements under the Indenture and the Security Documents. See “– Provision of Financial Statements and Reports.”

Consolidation, Merger and Sale of Assets

The Company will not consolidate with, merge with or into another Person, permit any Person to merge with or into it, or sell, convey, transfer, lease or otherwise dispose of all or substantially all of its and its Restricted Subsidiaries’ properties and assets (computed on a consolidated basis) (as an entirety or substantially an entirety in one transaction or a series of related transactions), unless:

(1) the Company shall be the continuing Person, or the Person (if other than it) formed by such consolidation or merger or that acquired or leased such property and assets (the “Surviving Person”) shall be a corporation organized and validly existing under the laws of the Cayman Islands, the British Virgin Islands or Hong Kong and shall expressly assume, by a supplemental indenture to the Indenture, executed and delivered to the Trustee, all the obligations of the Company under the Indenture, the Notes and the Security Documents, as the case may be, including the obligation to pay Additional Amounts with respect to any jurisdiction in which it is organized or resident for tax purposes or through which it makes payments, and the Indenture, the Notes and the Security Documents, as the case may be, shall remain in full force and effect;
(2) immediately after giving effect to such transaction, no Default shall have occurred and be continuing;
(3) immediately after giving effect to such transaction on a pro forma basis, the Company or the Surviving Person, as the case may be, shall have a Consolidated Net Worth equal to or greater than the Consolidated Net Worth of the Company immediately prior to such transaction;
(4) immediately after giving effect to such transaction on a pro forma basis the Company or the Surviving Person, as the case may be, could Incur at least US$1.00 of Indebtedness under paragraph (1) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock;”
(5) the Company delivers to the Trustee (x) an Officers’ Certificate (attaching the arithmetic computations to demonstrate compliance with clauses (3) and (4)) and (y) an Opinion of Counsel, in each case stating that such consolidation, merger or transfer and the relevant supplemental indenture complies with this provision and that all conditions precedent provided for in the Indenture relating to such transaction have been complied with;
(6) each Subsidiary Guarantor and JV Subsidiary Guarantor, unless such Subsidiary Guarantor or JV Subsidiary Guarantor is the Person with which the Company has entered into a transaction described under the caption “– Consolidation, Merger and Sale of Assets,” shall execute and deliver a supplemental indenture to the Indenture confirming that its Subsidiary Guarantee or JV Subsidiary Guarantee, as applicable, shall apply to the obligations of the Company or the Surviving Person in accordance with the Notes and the Indenture; and
(7) no Rating Decline shall have occurred.

No Subsidiary Guarantor or JV Subsidiary Guarantor will consolidate with, merge with or into another Person, permit any Person to merge with or into it, or sell, convey, transfer, lease or otherwise dispose of all

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or substantially all of its and its Restricted Subsidiaries’ properties and assets (computed on a consolidated basis) (as an entirety or substantially an entirety in one transaction or a series of related transactions) to another Person (other than the Company or another Subsidiary Guarantor or, in the case of a JV Subsidiary Guarantor, other than to another JV Subsidiary Guarantor, the Company or a Subsidiary Guarantor), unless:

(1) such Subsidiary Guarantor or JV Subsidiary Guarantor shall be the continuing Person, or the Person (if other than it) formed by such consolidation or merger or that acquired or leased such property and assets shall be the Company, another Subsidiary Guarantor or shall become a Subsidiary Guarantor concurrently with the transaction (or, in the case of a JV Subsidiary Guarantor, another JV Subsidiary Guarantor, the Company or a Subsidiary Guarantor); and shall expressly assume, by a supplemental indenture to the Indenture, executed and delivered to the Trustee, all the obligations of such Subsidiary Guarantor or JV Subsidiary Guarantor under the Indenture, the Notes and the Security Documents, as the case may be, including the obligation to pay Additional Amounts with respect to any jurisdiction in which it is organized or resident for tax purposes or through which it makes payments, and the Indenture, the Notes and the Security Documents, as the case may be, shall remain in full force and effect;
(2) immediately after giving effect to such transaction, no Default shall have occurred and be continuing;
(3) immediately after giving effect to such transaction on a pro forma basis, the Company shall have a Consolidated Net Worth equal to or greater than the Consolidated Net Worth of the Company immediately prior to such transaction;
(4) immediately after giving effect to such transaction on a pro forma basis, the Company could Incur at least US$1.00 of Indebtedness under paragraph (1) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock;”
(5) the Company delivers to the Trustee (x) an Officers’ Certificate (attaching the arithmetic computations to demonstrate compliance with clauses (3) and (4)) and (y) an Opinion of Counsel, in each case stating that such consolidation, merger or transfer and the relevant supplemental indenture complies with this provision and that all conditions precedent provided for in the Indenture relating to such transaction have been complied with; and
(6) no Rating Decline shall have occurred;

provided that this paragraph shall not apply to any sale or other disposition that complies with the “– Limitation on Asset Sales” covenant or any Subsidiary Guarantor or JV Subsidiary Guarantor whose Subsidiary Guarantee or JV Subsidiary Guarantee, as the case may be, is unconditionally released in accordance with the provisions described under “– The Subsidiary Guarantees – Release of the Subsidiary Guarantees.”

Although there is a limited body of case law interpreting the phrase “substantially all,” there is no precise established definition of the phrase under applicable law. Accordingly, in certain circumstances there may be a degree of uncertainty as to whether a particular transaction would involve “all or substantially all” of the property or assets of a Person.

The foregoing requirements shall not apply to a consolidation or merger of any Subsidiary Guarantor or JV Subsidiary Guarantor with and into the Company or any other Subsidiary Guarantor or JV Subsidiary Guarantor, so long as the Company or such Subsidiary Guarantor or JV Subsidiary Guarantor survives such consolidation or merger.

The foregoing provisions would not necessarily afford Holders protection in the event of highly-leveraged or other transactions involving the Company that may adversely affect Holders.

No Payments for Consents

The Company will not, and shall not permit any of its Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee or otherwise, to any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the Indenture or the Notes unless such consideration is offered to be paid or is paid to all Holders that consent, waive or agree to amend such term or provision within the time period set forth in the solicitation documents relating to such consent, waiver or amendment.

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Defeasance

Defeasance and Discharge

The Indenture will provide that the Company will be deemed to have paid and will be discharged from any and all obligations in respect of the Notes on the 183rd day after the deposit referred to below, and the provisions of the Indenture and the Security Documents will no longer be in effect with respect to the Notes (except for, among other matters, certain obligations to register the transfer or exchange of the Notes, to replace stolen, lost or mutilated Notes, to maintain paying agencies, to pay Additional Amounts and to hold monies for payment in trust) if, among other things:

(1) the Company (a) has deposited with the Trustee (or its agent), in trust, money and/or U.S. Government Obligations that through the payment of interest and principal in respect thereof in accordance with their terms will provide money in an amount sufficient to pay the principal of, premium, if any, and accrued interest on the Notes on the Stated Maturity for such payments in accordance with the terms of the Indenture and the Notes and (b) has delivered to the Trustee an Opinion of Counsel or a certificate of an internationally-recognized firm of independent accountants to the effect that the amount deposited by the Company is sufficient to provide payment for the principal of, premium, if any, and accrued interest on, the Notes on the Stated Maturity for such payment in accordance with the terms of the Indenture;
(2) the Company has delivered to the Trustee (a) either (x) an Opinion of Counsel of recognized international standing with respect to U.S. federal tax laws which is based on a change in applicable U.S. federal income tax law occurring after the Original Issue Date to the effect that beneficial owners will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the Company’s exercise of its option under this “Defeasance and Discharge” provision and will be subject to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such deposit, defeasance and discharge had not occurred or (y) a ruling directed to the Trustee received from the U.S. Internal Revenue Service to the same effect as the aforementioned Opinion of Counsel, and (b) an Opinion of Counsel of recognized international standing to the effect that the creation of the defeasance trust does not violate the U.S. Investment Company Act of 1940, as amended, and after the passage of 123 days following the deposit, the trust fund will not be subject to the effect of Section 547 of the United States Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law; and
(3) immediately after giving effect to such deposit on a pro forma basis, no Event of Default, or event that after the giving of notice or lapse of time or both would become an Event of Default, shall have occurred and be continuing on the date of such deposit or during the period ending on the 183rd day after the date of such deposit, and such defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company or any Restricted Subsidiary is a party or by which the Company or any Restricted Subsidiary is bound.

In the case of either discharge or defeasance of the Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees will terminate.

Defeasance of Certain Covenants

The Indenture further will provide that the provisions of the Indenture applicable to the Notes will no longer be in effect with respect to clauses (3), (4), (5)(x) and (7) under the first paragraph, and clauses (3), (4), (5)(x) and (6) under the second paragraph under “– Consolidation, Merger and Sale of Assets” and all the covenants described herein under “– Certain Covenants,” other than as described under “– Certain Covenants-Government Approvals and Licenses; Compliance with Law” and “– Certain Covenants-Anti-Layering,” clause (3) under “Events of Default” with respect to clauses (3), (4), (5)(x) and (7) under the first paragraph, and clauses (3), (4), (5)(x) and (6) under the second paragraph under “Consolidation, Merger and Sale of Assets” and with respect to the other events set forth in such clause, clause (4) under “Events of Default” with respect to such other covenants and clauses (5) and (6) under “Events of Default” shall be deemed not to be Events of Default upon, among other things, the deposit with the Trustee (or its agent), in trust, of money, U.S. Government Obligations or a combination thereof that through the payment of interest and principal in respect thereof in accordance with their terms will provide money in an amount sufficient to pay the principal of, premium, if any, and accrued interest on the Notes on the Stated Maturity of such payments

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in accordance with the terms of the Indenture and the Notes, the satisfaction of the provisions described in clause (2) (b) of the preceding paragraph and the delivery by the Company to the Trustee of an Opinion of Counsel of recognized international standing with respect to U.S. federal income tax matters to the effect that beneficial owners will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such deposit and defeasance of certain covenants and Events of Default and will be subject to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred.

Defeasance and Certain Other Events of Default

In the event that the Company exercises its option to omit compliance with certain covenants and provisions of the Indenture as described in the immediately preceding paragraph and the Notes are declared due and payable because of the occurrence of an Event of Default that remains applicable, the amount of money and/or U.S. Government Obligations on deposit with the Trustee will be sufficient to pay amounts due on the Notes at the time of their Stated Maturity but may not be sufficient to pay amounts due on the Notes at the time of the acceleration resulting from such Event of Default. However, the Company, the Subsidiary Guarantors and the JV Subsidiary Guarantors will remain liable for such payments.

Amendments and Waiver

Amendments Without Consent of Holders

The Indenture, the Intercreditor Agreement or any Security Document may be amended, without the consent of any Holder, to:

(1) cure any ambiguity, defect, omission or inconsistency in the Indenture, the Notes, the Intercreditor Agreement or any Security Document;
(2) comply with the provisions described under “– Consolidation, Merger and Sale of Assets;”
(3) evidence and provide for the acceptance of appointment by a successor Trustee or Collateral Agent;
(4) add any Subsidiary Guarantor, JV Subsidiary Guarantor, any Subsidiary Guarantee or JV Subsidiary Guarantee, or release any Subsidiary Guarantor or JV Subsidiary Guarantor from any Subsidiary Guarantee or JV Subsidiary Guarantee, as the case may be, as provided or permitted by the terms of the Indenture;
(5) provide for the issuance of Additional Notes in accordance with the limitations set forth in the Indenture;
(6) add any Subsidiary Guarantor Pledgor or release any Subsidiary Guarantor Pledgor and the corresponding Collateral as provided or permitted by the terms of the Indenture;
(7) add additional Collateral to secure the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee;
(8) in any other case where a supplemental indenture to the Indenture is required or permitted to be entered into pursuant to the provisions of the Indenture without the consent of any Holder;
(9) effect any changes to the Indenture in a manner necessary to comply with the procedures of Euroclear or Clearstream;
(10) permit Permitted Pari Passu Secured Indebtedness (including, without limitation, permitting the Trustee and the Collateral Agent to enter into, supplement or amend the Intercreditor Agreement, the Security Documents or the Indenture permitting the holders of Permitted Pari Passu Secured Indebtedness (or their representatives) to accede to the Intercreditor Agreement, as applicable, and take any other action necessary to permit the creation and registration of Liens on the Collateral to secure Permitted Pari Passu Secured Indebtedness, in accordance with the Indenture);
(11) make any other change that does not materially and adversely affect the rights of any Holder; or

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(12) conform the text of the Indenture, the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees to any provision of this “Description of the Notes” to the extent that such provision in this “Description of the Notes” was intended to be a verbatim recitation of a provision in the Indenture, the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees.

Amendments With Consent of Holders

The Indenture, the Intercreditor Agreement or any Security Document may be amended with the consent of the Holders of not less than a majority in aggregate principal amount of the outstanding Notes and the Agents may amend or waive future compliance by the Company with any provision thereof; provided , however , that no such amendment or waiver may, without the consent of each Holder affected thereby:

(1) change the Stated Maturity of the principal of, or any installment of interest on, any Note;
(2) reduce the principal amount of, or premium, if any, or interest on, any Note;
(3) change the currency, time or place of payment of principal of, or premium, if any, or interest on, any Note;
(4) impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity (or, in the case of a redemption, on or after the redemption date) of any Note;
(5) reduce the above-stated percentage of outstanding Notes the consent of whose Holders is necessary to modify or amend the Indenture;
(6) waive a default in the payment of principal of, premium, if any, or interest on the Notes;
(7) release any Subsidiary Guarantor or JV Subsidiary Guarantor from its Subsidiary Guarantee or JV Subsidiary Guarantee, as the case may be, except as provided in the Indenture;
(8) release any Collateral, except as provided in the Indenture, the Intercreditor Agreement and the Security Documents;
(9) reduce the percentage or aggregate principal amount of outstanding Notes the consent of whose Holders is necessary for waiver of compliance with certain provisions of the Indenture or for waiver of certain defaults;
(10) amend, change or modify any Subsidiary Guarantee or JV Subsidiary Guarantee in a manner that adversely affects the Holders;
(11) amend, change or modify any provision of the Indenture, the Intercreditor Agreement or any Security Document relating to the Collateral, in a manner that adversely affects the Holders, except in accordance with the other provisions of the Indenture;
(12) reduce the amount payable upon a Change of Control Offer or an Offer to Purchase with the Excess Proceeds from any Asset Sale or change the time or manner by which a Change of Control Offer or an Offer to Purchase with the Excess Proceeds or other proceeds from any Asset Sale may be made or by which the Notes must be repurchased pursuant to a Change of Control Offer or an Offer to Purchase with the Excess Proceeds or other proceeds from any Asset Sale;
(13) change the redemption date or the redemption price of the Notes from that stated under the caption “– Optional Redemption” or “– Redemption for Taxation Reasons;”
(14) amend, change or modify the obligation of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor to pay Additional Amounts; or
(15) amend, change or modify any provision of the Indenture or the related definition affecting the ranking of the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee in a manner which adversely affects the Holders.

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Unclaimed Money

Claims against the Company for the payment of principal of, premium, if any, or interest, on the Notes will become void unless presentation for payment is made as required in the Indenture within a period of six years.

No Personal Liability of Incorporators, Stockholders, Officers, Directors or Employees

No recourse for the payment of the principal of, premium, if any, or interest on any of the Notes or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor in the Indenture, or in any of the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees, or because of the creation of any Indebtedness represented thereby, shall be had against any incorporator, stockholder, officer, director, employee or controlling person of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor, or of any successor Person thereof. Each Holder, by accepting the Notes, waives and releases all such liability. The waiver and release are part of the consideration for the issuance of the Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees. Such waiver may not be effective to waive liabilities under the federal securities laws.

Concerning the Agents

The Bank of New York Mellon, London Branch is to be appointed as Trustee and as paying agent (the “Paying Agent”) under the Indenture. The Bank of New York Mellon (Luxembourg) S.A. is to be appointed as note registrar (the “Registrar”) and transfer agent (the “Transfer Agent” and, together with the Paying Agent and Registrar, the “Agents”) with regard to the Notes. Except during the continuance of a Default, the Trustee undertakes to perform such duties and only such duties as are specifically set forth in the Indenture, and no implied covenant or obligation shall be read into the Indenture against the Trustee. If an Event of Default has occurred and is continuing, the Trustee will use the same degree of care and skill in its exercise of the rights and powers vested in it under the Indenture as a prudent person would exercise under the circumstances in the conduct of such person’s own affairs.

The Indenture contains limitations on the rights of the Trustee, should it become a creditor of the Company or any of the Subsidiary Guarantors, to obtain payment of claims in certain cases or to realize on certain property received by it in respect of any such claims, as security or otherwise. The Trustee is permitted to engage in other transactions, including normal banking and trustee relationships, with the Company and its Affiliates; provided, however , that if it acquires any conflicting interest, it must eliminate such conflict or resign.

If the Company maintains a paying agent with respect to the Notes in a member state of the European Union, such paying agent will be located in a member state of the European Union that is not obligated to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any other directive implementing the conclusions of ECOFIN Council meeting of November 26-27, 2000 on the taxation of savings income, or any law implementing or complying with, or introduced in order to conform to, such Directive or such other directive.

The Bank of New York Mellon will initially act as the Collateral Agent under the Security Documents in respect of the security over the Collateral. The Collateral Agent, acting in its capacity as such, shall have such duties with respect to the Collateral pledged, assigned or granted pursuant to the Security Documents as are set forth in the Indenture, the Intercreditor Agreement and the Security Documents. Under certain circumstances, the Collateral Agent may have obligations under the Security Documents, the Indenture or the Intercreditor Agreement that are in conflict with the interests of the Trustee, the Holders and the holders (or their representatives) of Permitted Pari Passu Secured Indebtedness. Neither the Trustee nor the Collateral Agent will be under any obligation to exercise any rights or powers conferred under the Indenture, the Intercreditor Agreement or any Security Document for the benefit of the Holders or the holders (or their representatives) of Permitted Pari Passu Secured Indebtedness, unless such Holders and/or the holders (or their representatives) of Permitted Pari Passu Secured Indebtedness have offered to the Trustee and/or the Collateral Agent indemnity and/or security satisfactory to it against any loss, liability or expense. Furthermore, each Holder, by accepting the Notes will agree, for the benefit of the Trustee, the other Agents and the Collateral Agent, that it is solely responsible for its own independent appraisal of and investigation into all risks arising under or in connection with the Security Documents and has not relied on and will not at any time rely on the Trustee, the other Agents or the Collateral Agent in respect of such risks.

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Book-Entry; Delivery and Form

The Notes will be represented by one or more global notes in registered form without interest coupons attached (each a “Global Note”). On the Original Issue Date, the Global Note will be deposited with a common depositary and registered in the name of the common depositary or its nominee for the accounts of Euroclear and Clearstream.

Global Note

Ownership of beneficial interests in the Global Note (the “book-entry interests”) will be limited to persons that have accounts with Euroclear and/or Clearstream or persons that may hold interests through such participants. Book-entry interests will be shown on, and transfers thereof will be effected only through, records maintained in book-entry form by Euroclear and Clearstream and their participants.

Except as set forth below under “– Individual Definitive Notes,” the book-entry interests will not be held in definitive form. Instead, Euroclear and/or Clearstream will credit on their respective book-entry registration and transfer systems a participant’s account with the interest beneficially owned by such participant. The laws of some jurisdictions may require that certain purchasers of securities take physical delivery of such securities in definitive form. The foregoing limitations may impair the ability to own, transfer or pledge book-entry interests.

So long as the Notes are held in global form, the common depositary for Euroclear and/or Clearstream (or its nominee) will be considered the sole holder of the Global Note for all purposes under the Indenture and “holders” of book-entry interests will not be considered the owners or “Holders” of Notes for any purpose. As such, participants must rely on the procedures of Euroclear and Clearstream and indirect participants must rely on the procedures of the participants through which they own book-entry interests in order to transfer their interests in the Notes or to exercise any rights of Holders under the Indenture.

None of the Company, the Subsidiary Guarantors, the JV Subsidiary Guarantors (if any), the Trustee or any of their respective agents will have any responsibility or be liable for any aspect of the records relating to the book-entry interests. The Notes are not issuable in bearer form.

Payments on the Global Note

Payments of any amounts owing in respect of the Global Note (including principal, premium, interest and additional amounts) will be made to the Paying Agent. The Paying Agent will, in turn, make such payments to the common depositary for Euroclear and Clearstream, which will distribute such payments to participants in accordance with their procedures. The Company will make payments of all such amounts without deduction or withholding for, or on account of, any present or future taxes, duties, assessments or governmental charges of whatever nature, except as may be required by law and as described under “– Additional Amounts.”

Under the terms of the Indenture, the Company and the Trustee will treat the registered holder of the Global Note (i.e., the common depositary or its nominee) as the owner thereof for the purpose of receiving payments and for all other purposes. Consequently, none of the Company, the Trustee or any of their respective agents has or will have any responsibility or liability for:

any aspect of the records of Euroclear, Clearstream or any participant or indirect participant relating to or payments made on account of a book-entry interest, for any such payments made by Euroclear, Clearstream or any participant or indirect participants, or for maintaining, supervising or reviewing any of the records of Euroclear, Clearstream or any participant or indirect participant relating to or payments made on account of a book-entry interest; or
Euroclear, Clearstream or any participant or indirect participant.

Payments by participants to owners of book-entry interests held through participants are the responsibility of such participants.

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Redemption of Global Note

In the event the Global Note, or any portion thereof, is redeemed, the common depositary will distribute the amount received by it in respect of the Global Note so redeemed to Euroclear and/or Clearstream, as applicable, who will distribute such amount to the holders of the book-entry interests in such Global Note. The redemption price payable in connection with the redemption of such book-entry interests will be equal to the amount received by the common depositary, Euroclear or Clearstream, as applicable, in connection with the redemption of such Global Note (or any portion thereof). The Company understands that under existing practices of Euroclear and Clearstream, if fewer than all of the Notes are to be redeemed at any time, Euroclear and Clearstream will credit their respective participants’ accounts on a proportionate basis (with adjustments to prevent fractions) or by lot or on such other basis as they deem fair and appropriate; provided , however , that no book-entry interest of US$200,000 principal amount, or less, as the case may be, will be redeemed in part.

Action by Owners of Book-Entry Interests

Euroclear and Clearstream have advised that they will take any action permitted to be taken by a Holder only at the direction of one or more participants to whose account the book-entry interests in the Global Note are credited and only in respect of such portion of the aggregate principal amount of Notes as to which such participant or participants has or have given such direction. Euroclear and Clearstream will not exercise any discretion in the granting of consents, waivers or the taking of any other action in respect of the Global Note. If there is an Event of Default under the Notes, however, each of Euroclear and Clearstream reserves the right to exchange the Global Note for individual definitive notes in certificated form, and to distribute such individual definitive notes to their participants.

Transfers

Transfers between participants in Euroclear and Clearstream will be effected in accordance with Euroclear and Clearstream’s rules and will be settled in immediately available funds. If a Holder requires physical delivery of individual definitive notes for any reason, including to sell the Notes to persons in jurisdictions which require physical delivery of such securities or to pledge such securities, such Holder must transfer its interest in the Global Note in accordance with the normal procedures of Euroclear and Clearstream and in accordance with the provisions of the Indenture.

Book-entry interests in the Global Note will be subject to the restrictions on transfer discussed under “Transfer Restrictions.”

Any book-entry interest in a Global Note that is transferred to a person who takes delivery in the form of a book-entry interest in another Global Note will, upon transfer, cease to be a book-entry interest in the first-mentioned Global Note and become a book-entry interest in the other Global Note and, accordingly, will thereafter be subject to all transfer restrictions, if any, and other procedures applicable to book-entry interests in such other Global Note for as long as it retains such a book-entry interest.

Global Clearance and Settlement Under the Book-Entry System

Book-entry interests owned through Euroclear or Clearstream accounts will follow the settlement procedures applicable. Book-entry interests will be credited to the securities custody accounts of Euroclear and Clearstream holders on the business day following the settlement date against payment for value on the settlement date.

The book-entry interests will trade through participants of Euroclear or Clearstream, and will settle in immediately available funds. Since the purchaser determines the place of delivery, it is important to establish at the time of trading of any book-entry interests where both the purchaser’s and seller’s accounts are located to ensure that settlement can be made on the desired value date.

Information Concerning Euroclear and Clearstream

The Company understands as follows with respect to Euroclear and Clearstream:

Euroclear and Clearstream hold securities for participating organizations and facilitate the clearance and settlement of securities transactions between their respective participants through electronic book-entry changes in accounts of such participants. Euroclear and Clearstream provide to their participants, among other things,

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services for safekeeping, administration, clearance and settlement of internationally traded securities and securities lending and borrowing. Euroclear and Clearstream interface with domestic securities markets. Euroclear and Clearstream participants are financial institutions, such as underwriters, securities brokers and dealers, banks and trust companies, and certain other organizations. Indirect access to Euroclear or Clearstream is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodian relationship with a Euroclear or Clearstream participant, either directly or indirectly.

Although the foregoing sets out the procedures of Euroclear and Clearstream in order to facilitate the original issue and subsequent transfers of interests in the Notes among participants of Euroclear and Clearstream, neither Euroclear nor Clearstream is under any obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time.

None of the Company, the Trustee or any of their respective agents will have responsibility for the performance of Euroclear or Clearstream or their respective participants of their respective obligations under the rules and procedures governing their operations, including, without limitation, rules and procedures relating to book-entry interests.

Individual Definitive Notes

If (1) the common depositary or any successor to the common depositary is at any time unwilling or unable to continue as a depositary for the reasons described in the Indenture and a successor depositary is not appointed by the Company within 90 days (2) either Euroclear or Clearstream, or a successor clearing system is closed for business for a continuous period of 14 days (other than by reason of holidays, statutory or otherwise) or announces an intention to permanently cease business or does in fact do so, or (3) any of the Notes has become immediately due and payable in accordance with “– Events of Default” and the Company has received a written request from a Holder, the Company will issue individual definitive notes in registered form in exchange for the Global Note. Upon receipt of such notice from the common depositary or the Trustee, as the case may be, the Company will use its best efforts to make arrangements with the common depositary for the exchange of interests in the Global Note for individual definitive notes and cause the requested individual definitive notes to be executed and delivered to the registrar in sufficient quantities and authenticated by the Trustee for delivery to Holders. Persons exchanging interests in the Global Note for individual definitive notes will be required to provide the registrar, through the relevant clearing system, with written instruction and other information required by the Company and the registrar to complete, execute and deliver such individual definitive notes. In all cases, individual definitive notes delivered in exchange for any Global Note or beneficial interests therein will be registered in the names, and issued in any approved denominations, requested by the relevant clearing system.

Individual definitive notes will not be eligible for clearing and settlement through Euroclear or Clearstream.

Notices

All notices or demands required or permitted by the terms of the Notes or the Indenture to be given to or by the Holders are required to be in writing and may be given or served by being sent by prepaid courier or first-class mail (if intended for the Company or any Subsidiary Guarantor) addressed to the Company or such Subsidiary Guarantor at the registered office of the Company, if intended for the Trustee, at the corporate trust office of the Trustee; and (if intended for any Holder) addressed to such Holder at such Holder’s last address as it appears in the Note register.

Any such notice or demand will be deemed to have been sufficiently given or served when so sent or deposited and, if to the Holders, when delivered in accordance with the applicable rules and procedures of Euroclear or Clearstream, as the case may be. Any such notice shall be deemed to have been delivered on the day such notice is delivered to Euroclear or Clearstream, as the case may be, or if by mail, when so sent or deposited.

Consent to Jurisdiction; Service of Process

The Company and each of the Subsidiary Guarantors will irrevocably (1) submit to the non-exclusive jurisdiction of any U.S. federal or New York state court located in the Borough of Manhattan, The City of New York in connection with any suit, action or proceeding arising out of, or relating to, the Notes, any Subsidiary Guarantee, any JV Subsidiary Guarantee, the Indenture or any transaction contemplated thereby and (2) designate and appoint National Corporate Research, Ltd. for receipt of service of process in any such suit, action or proceeding.

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Governing Law

Each of the Notes, the Subsidiary Guarantees, the JV Subsidiary Guarantees and the Indenture provides that such instrument will be governed by, and construed in accordance with, the laws of the State of New York. The relevant pledge agreements pursuant to which the Capital Stock of the Subsidiary Guarantors are pledged as described under “– Security” will be governed under the laws of the jurisdiction in which the relevant Subsidiary Guarantor is incorporated.

Definitions

Set forth below are defined terms used in the covenants and other provisions of the Indenture. Reference is made to the Indenture for other capitalized terms used in this “Description of the Notes” for which no definition is provided.

“Acquired Indebtedness” means Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary or Indebtedness of a Restricted Subsidiary assumed in connection with an Asset Acquisition by such Restricted Subsidiary whether or not Incurred in connection with, or in contemplation of, the Person merging with or into or becoming a Restricted Subsidiary.

“Adjusted Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield in maturity of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

“Affiliate” means, with respect to any Person, any other Person (1) directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person; (2) who is a director or officer of such Person or any Subsidiary of such Person or of any Person referred to in clause (1) of this definition; or (3) who is a spouse or any person cohabiting as a spouse, child or step-child, parent or step-parent, brother, sister, step-brother or step-sister, parent-in-law, grandchild, grandparent, uncle, aunt, nephew and niece of a Person described in clause (1) or (2). For purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

“Applicable Premium” means with respect to any Note at any redemption date, the greater of (1) 1.00% of the principal amount of such Note and (2) the excess of (A) the present value at such redemption date of the redemption price of such Note on July 21, 2017 (such redemption price being described in the first paragraph in the “– Optional Redemption” section exclusive of any accrued interest), plus all required remaining scheduled interest payments due on such Note through July 21, 2017 (but excluding accrued and unpaid interest to the redemption date), computed using a discount rate equal to the Adjusted Treasury Rate plus 100 basis points, over (B) the principal amount of such Note on such redemption date.

“April 2016 Notes” means the 9.75% Senior Notes due 2016 issued by the Company.

“April 2016 Notes Indenture” means the indenture dated April 23, 2013, under which the April 2016 Notes were issued.

“Asset Acquisition” means (1) an investment by the Company or any Restricted Subsidiary in any other Person pursuant to which such Person shall become a Restricted Subsidiary or shall be merged into or consolidated with the Company or any Restricted Subsidiary; or (2) an acquisition by the Company or any Restricted Subsidiary of the property and assets of any Person other than the Company or any Restricted Subsidiary that constitute substantially all of a division or line of business of such Person.

“Asset Disposition” means the sale or other disposition by the Company or any Restricted Subsidiary (other than to the Company or another Restricted Subsidiary) of (1) all or substantially all of the Capital Stock of any Restricted Subsidiary; or (2) all or substantially all of the assets that constitute a division or line of business of the Company or any Restricted Subsidiary.

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“Asset Sale” means any sale, transfer or other disposition (including by way of merger, consolidation or Sale and Leaseback Transaction) of any of its property or assets (including any sale of Capital Stock of a Subsidiary or issuance of Capital Stock by a Restricted Subsidiary) in one transaction or a series of related transactions by the Company or any Restricted Subsidiary to any Person; provided that “Asset Sale” shall not include:

(1) Sales, transfers or other dispositions of inventory, receivables and other current assets (including properties under development for sale and completed properties for sale) in the ordinary course of business;
(2) sales, transfers or other dispositions of assets constituting a Permitted Investment or Restricted Payment permitted to be made under the “– Limitation on Restricted Payments” covenant;
(3) sales, transfers or other dispositions of assets with a Fair Market Value not in excess of US$1.0 million (or the Dollar Equivalent thereof) in any transaction or series of related transactions;
(4) any sale, transfer, assignment or other disposition of any property, or equipment that has become damaged, worn out, obsolete or otherwise unsuitable for use in connection with the business of the Company and its Restricted Subsidiaries;
(5) any transfer, assignment or other disposition deemed to occur in connection with creating or granting any Permitted Lien;
(6) a transaction covered by the “– Consolidation, Merger and Sale of Assets” covenant; and
(7) any sale, transfer or other disposition by the Company or any Restricted Subsidiary, including the sale or issuance by the Company or any Restricted Subsidiary of any Capital Stock of any Restricted Subsidiary, to the Company or any Restricted Subsidiary.

“Attributable Indebtedness” means, in respect of a Sale and Leaseback Transaction, at the time of determination, the present value, discounted at the interest rate implicit in the Sale and Leaseback Transaction, of the total obligations of the lessee for rental payments during the remaining term of the lease in the Sale and Leaseback Transaction, including any period for which such lease has been extended or may, at the option of the lessor, be extended.

“Average Life” means, at any date of determination with respect to any Indebtedness, the quotient obtained by dividing (1) the sum of the products of (a) the number of years from such date of determination to the dates of each successive scheduled principal payment of such Indebtedness and (b) the amount of such principal payment by (2) the sum of all such principal payments.

“Bank Deposit Secured Indebtedness” means Indebtedness of the Company or any Restricted Subsidiary that is secured by a pledge of one or more bank accounts of the Company or a Restricted Subsidiary and is used by the Company and its Restricted Subsidiaries to in effect exchange foreign currencies.

“Board of Directors” means the board of directors elected or appointed by the stockholders of the Company to manage the business of the Company or any committee of such board duly authorized to take the action purported to be taken by such committee.

“Board Resolution” means any resolution of the Board of Directors taking an action which it is authorized to take and adopted at a meeting duly called and held at which a quorum of disinterested members (if so required) was present and acting throughout or adopted by written resolution executed by every member of the Board of Directors.

“Business Day” means any day which is not a Saturday, Sunday, legal holiday or other day on which banking institutions in The City of New York, London or Hong Kong (or in any other place in which payments on the Notes are to be made) are authorized by law or governmental regulation to close.

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated, whether voting or non-voting) in equity of such Person, whether outstanding on the Original Issue Date or issued thereafter, including, without limitation, all Common Stock and Preferred Stock, but excluding debt securities convertible into such equity.

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“Capitalized Lease” means, with respect to any Person, any lease of any property (whether real, personal or mixed) which, in conformity with GAAP, is required to be capitalized on the balance sheet or statement of financial position of such Person.

“Capitalized Lease Obligations” means the discounted present value of the rental obligations under a Capitalized Lease.

“Change of Control” means the occurrence of one or more of the following events:

(1) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Restricted Subsidiaries, taken as a whole, to any “person” (within the meaning of Section 13(d) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than one or more Permitted Holders;
(2) the Company consolidates with, or merges with or into, any Person (other than one or more Permitted Holders), or any Person consolidates with, or merges with or into, the Company, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of the Company or such other Person is converted into or exchanged for cash, securities or other property, other than any such transaction where the Voting Stock of the Company outstanding immediately prior to such transaction is converted into or exchanged for (or continues as) Voting Stock (other than Disqualified Stock) of the surviving or transferee Person constituting a majority of the outstanding shares of Voting Stock of such surviving or transferee Person (immediately after giving effect to such issuance) and in substantially the same proportion as before the transaction;
(3) the Permitted Holders are the beneficial owners of less than 50.1% of the total voting power of the Voting Stock of the Company;
(4) individuals who on the Original Issue Date constituted the board of directors of the Company, together with any new directors whose election was approved by a vote of at least two-thirds of the directors then still in office who were either directors or whose election was previously so approved, cease for any reason to constitute a majority of the board of directors of the Company then in office; or
(5) the adoption of a plan relating to the liquidation or dissolution of the Company.

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Rating Decline.

“Clearstream” means Clearstream Banking, socie´te´ anonyme, Luxembourg.

“Collateral” means all collateral securing, or purported to be securing, directly or indirectly, the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee pursuant to the Security Documents, and shall initially consist of the Capital Stock of the initial Subsidiary Guarantors.

“Collateral Agent” means The Bank of New York Mellon.

“Commodity Agreement” means any spot, forward or option commodity price protection agreements or other similar agreement or arrangement designed to protect against fluctuations in commodity prices.

“Common Stock” means, with respect to any Person, any and all shares, interests or other participations in, and other equivalents (however designated and whether voting or non-voting) of such Person’s common stock or ordinary shares, whether or not outstanding on the Original Issue Date, and include, without limitation, all series and classes of such common stock or ordinary shares.

“Comparable Treasury Issue” means the U.S. Treasury security having a maturity comparable to the remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes from the redemption date to July 21, 2017.

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“Comparable Treasury Price” means, with respect to any redemption date:

(1) the average of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) on the third Business Day preceding such redemption date, as set forth in the daily statistical release (or any successor release) published by the Federal Reserve Bank of New York and designated “Composite 3:30 p.m. Quotations for U.S. Government Securities;” or
(2) if such release (or any successor release) is not published or does not contain such prices on such Business Day, (a) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest of such Reference Treasury Dealer Quotations, or (b) if fewer than three such Reference Treasury Dealer Quotations are available, the average of all such quotations.

“Consolidated Assets” means, with respect to any Restricted Subsidiary at any date of determination, the Company and its Restricted Subsidiaries’ proportionate interest in the total consolidated assets of such Restricted Subsidiary and its Restricted Subsidiaries measured in accordance with GAAP as of the last day of the most recent fiscal quarter period for which consolidated financial statements of the Company and its Restricted Subsidiaries (which the Company shall use its reasonable best efforts to compile in a timely manner) are available and have been provided to the Trustee.

“Consolidated EBITDA” means, for any period, Consolidated Net Income for such period plus, to the extent such amount was deducted in calculating such Consolidated Net Income:

(1) Consolidated Interest Expense,
(2) income taxes (other than income taxes attributable to extraordinary and non-recurring gains (or losses) or sales of assets), and
(3) depreciation expense, amortization expense and all other non-cash items reducing Consolidated Net Income (other than non-cash items in a period which reflect cash expenses paid or to be paid in another period), less all non-cash items increasing Consolidated Net Income,

all as determined on a consolidated basis for the Company and its Restricted Subsidiaries in conformity with GAAP; provided that (1) if any Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary (other than Jiangsu Future Land Co., Ltd. and its directly and indirectly held Subsidiaries), Consolidated EBITDA shall be reduced (to the extent not otherwise reduced in accordance with GAAP) by an amount equal to (A) the amount of the Consolidated Net Income attributable to such Restricted Subsidiary multiplied by (B) the percentage ownership interest in the income of such Restricted Subsidiary not owned on the last day of such period by the Company or any Restricted Subsidiary; (2) in the case of Jiangsu Future Land Co., Ltd. (consolidated in accordance with GAAP), Consolidated EBITDA shall be reduced (to the extent not already reduced in accordance with GAAP) by any payments, distributions or amounts (including the Fair Market Value of any non-cash payments, distributions or amounts) declared or paid by Jiangsu Future Land Co., Ltd. to its shareholders other than the Company or any Restricted Subsidiary; and (3) in the case of any PRC CJV (consolidated in accordance with GAAP), Consolidated EBITDA shall be reduced (to the extent not already reduced in accordance with GAAP) by any payments, distributions or amounts (including the Fair Market Value of any non-cash payments, distributions or amounts) required to be made or paid by such PRC CJV to the PRC CJV Partner, or to which the PRC CJV Partner otherwise has a right or is entitled, pursuant to the joint venture agreement governing such PRC CJV.

“Consolidated Fixed Charges” means, for any period, the sum (without duplication) of (1) Consolidated Interest Expense for such period and (2) all cash and non-cash dividends paid, declared, accrued or accumulated during such period on any Disqualified Stock or Preferred Stock of the Company or any Restricted Subsidiary held by Persons other than the Company or any Wholly Owned Restricted Subsidiary, except for dividends payable in the Company’s Capital Stock (other than Disqualified Stock) or paid to the Company or a Wholly Owned Restricted Subsidiary.

“Consolidated Interest Expense” means, for any period, the amount that would be included in gross interest expense on a consolidated income statement prepared in accordance with GAAP for such period of the Company and its Restricted Subsidiaries, plus, to the extent not included in such gross interest expense, and to

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the extent incurred, accrued or payable during such period by the Company and its Restricted Subsidiaries, without duplication, (1) interest expense attributable to Capitalized Lease Obligations and imputed interest with respect to Attributable Indebtedness, (2) amortization of debt issuance costs and original issue discount expense and non-cash interest payments in respect of any Indebtedness, (3) the interest portion of any deferred payment obligation, (4) all commissions, discounts and other fees and charges with respect to letters of credit or similar instruments issued for financing purposes or in respect of any Indebtedness, (5) the net costs associated with Hedging Obligations (including the amortization of fees), (6) interest accruing on Indebtedness of any other Person that is Guaranteed by the Company or any Restricted Subsidiary (other than Pre-Registration Mortgage Guarantees) and (7) any capitalized interest, provided that interest expense attributable to interest on any Indebtedness bearing a floating interest rate will be computed on a pro forma basis as if the rate in effect on the date of determination had been the applicable rate for the entire relevant period.

“Consolidated Net Income” means, with respect to any specified Person for any period, the aggregate of the net income (or loss) of such Person and its Restricted Subsidiaries for such period, on a consolidated basis and, solely for the purposes of clause (c)(i) of the first paragraph of the covenant described under “– Certain Covenants-Limitation on Restricted Payments,” attributable to equity holders of such Person (which excludes net income attributable to non-controlling interests), determined in conformity with GAAP; provided that the following items shall be excluded in computing Consolidated Net Income (without duplication):

(1) the net income (or loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting except that:
(a) subject to the exclusion contained in clause (5) below, the Company’s equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to a Restricted Subsidiary, to the limitations contained in clause (3) below); and
(b) the Company’s equity in a net loss of any such Person for such period shall be included in determining such Consolidated Net Income to the extent funded with cash or other assets of the Company or Restricted Subsidiaries;
(2) the net income (or loss) of any Person accrued prior to the date it becomes a Restricted Subsidiary or is merged into or consolidated with the Company or any Restricted Subsidiary or all or substantially all of the property and assets of such Person are acquired by the Company or any Restricted Subsidiary;
(3) the net income (but not loss) of any Restricted Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of such net income is not at the time permitted by the operation of the terms of its charter, articles of association or other similar constitutive documents, or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to such Restricted Subsidiary;
(4) the cumulative effect of a change in accounting principles;
(5) any net after tax gains realized on the sale or other disposition of (a) any property or assets of the Company or any Restricted Subsidiary which is not sold in the ordinary course of its business or (b) any Capital Stock of any Person (including any gains by the Company realized on sales of Capital Stock of the Company or other Restricted Subsidiaries);
(6) any translation gains and losses due solely to fluctuations in currency values and related tax effects; and
(7) any net after-tax extraordinary or non-recurring gains.

“Consolidated Net Worth” means, at any date of determination, stockholders’ equity as set forth on the most recently available semi-annual or annual consolidated statement of financial position of the Company and its Restricted Subsidiaries, plus, to the extent not included, any Preferred Stock of the Company, less any amounts attributable to Disqualified Stock or any equity security convertible into or exchangeable for Indebtedness, the cost of treasury stock and the principal amount of any promissory notes receivable from the sale of the Capital Stock of the Company or any Restricted Subsidiary, each item to be determined in conformity with GAAP.

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“Contractor Guarantees” means any Guarantee by the Company or any Restricted Subsidiary of Indebtedness of any contractor, builder or other similar Person engaged by the Company or such Restricted Subsidiary in connection with the development, construction or improvement of real or personal property or equipment to be used in a Permitted Business by the Company or any Restricted Subsidiary in the ordinary course of business, which Indebtedness was Incurred by such contractor, builder or other similar Person to finance the cost of such development, construction or improvement.

“Creditor Representatives” means, collectively, the Trustee, the January 2018 Notes Trustee, the April 2016 Notes Trustee and holders (or their trustee representatives or agents) of any other Permitted Pari Passu Secured Indebtedness.

“Currency Agreement” means any foreign exchange forward contract, currency swap agreement or other similar agreement or arrangement designed to protect against fluctuations in foreign exchange rates.

“Debt Documents” means, collectively, the Indenture, the January 2018 Notes Indenture, the April 2016 Notes Indenture and the documents evidencing any other Permitted Pari Passu Secured Indebtedness.

“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.

“Disqualified Stock” means any class or series of Capital Stock of any Person that by its terms or otherwise is (1) required to be redeemed prior to the date that is 183 days after the Stated Maturity of the Notes, (2) redeemable at the option of the holder of such class or series of Capital Stock at any time prior to the date that is 183 days after the Stated Maturity of the Notes or (3) convertible into or exchangeable for Capital Stock referred to in clause (1) or (2) above or Indebtedness having a scheduled maturity prior to the Stated Maturity of the Notes; provided that any Capital Stock that would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require such Person to repurchase or redeem such Capital Stock upon the occurrence of an “asset sale” or “change of control” occurring prior to the Stated Maturity of the Notes shall not constitute Disqualified Stock if the “asset sale” or “change of control” provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in the “– Limitation on Asset Sales” and “– Repurchase of Notes upon a Change of Control Triggering Event” covenants and such Capital Stock specifically provides that such Person will not repurchase or redeem any such stock pursuant to such provision prior to the Company’s repurchase of such Notes as are required to be repurchased pursuant to the “– Limitation on Asset Sales” and “– Repurchase of Notes upon a Change of Control Triggering Event” covenants.

“Dollar Equivalent” means, with respect to any monetary amount in a currency other than U.S. dollars, at any time for the determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the base rate for the purchase of U.S. dollars with the applicable foreign currency as quoted by the Federal Reserve Bank of New York on the date of determination.

“Entrusted Loans” means borrowings by a PRC Restricted Subsidiary from a bank that are secured by a pledge of deposits made by another PRC Restricted Subsidiary to the lending bank as security for such borrowings, provided that such borrowings are not reflected on the consolidated statement of financial position of the Company.

“Equity Offering” means (i) any underwritten primary public offering or private placement of Common Stock of the Company after the Original Issue Date or (ii) any underwritten secondary public offering or secondary private placement of Common Stock of the Company beneficially owned by a Permitted Holder, after the Original Issue Date, to the extent that a Permitted Holder or a company controlled by a Permitted Holder concurrently with such public offering or private placement purchases in cash an equal amount of Common Stock from the Company at the same price as the public offering or private placement price; provided that any offering or placement referred to in (A) clause (i), (B) clause (ii), or (C) a combination of clauses (i) and (ii) result in the aggregate gross cash proceeds received by the Company being no less than US$20.0 million (or the Dollar Equivalent thereof).

“Euroclear” means Euroclear Bank S.A./N.V., as operator of the Euroclear System.

“Fair Market Value” means the price that would be paid in an arm’s-length transaction between an informed and willing seller under no compulsion to sell and an informed and willing buyer under no compulsion to buy, as determined in good faith by the Board of Directors, whose determination shall be conclusive if

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evidenced by a Board Resolution, except in the case of a determination of Fair Market Value of total assets for the purposes of determining a JV Entitlement Amount, in which case such price shall be determined by an accounting, appraisal or investment banking firm of recognized international standing appointed by the Company.

“Fixed Charge Coverage Ratio” means, on any Transaction Date, the ratio of (1) the aggregate amount of Consolidated EBITDA for the then most recent four fiscal quarters prior to such Transaction Date for which consolidated financial statements of the Company (which the Company shall use its reasonable best efforts to compile in a timely manner) are available (the “Four Quarter Period”) to (2) the aggregate Consolidated Fixed Charges during such Four Quarter Period. In making the foregoing calculation:

(a) pro forma effect shall be given to any Indebtedness or Preferred Stock Incurred, repaid or redeemed during the period (the “Reference Period”) commencing on and including the first day of the Four Quarter Period and ending on and including the Transaction Date (other than Indebtedness Incurred or repaid under a revolving credit or similar arrangement (or under any predecessor revolving credit or similar arrangement) in effect on the last day of such Four Quarter Period), in each case as if such Indebtedness or Preferred Stock had been Incurred, repaid or redeemed on the first day of such Reference Period; provided that, in the event of any such repayment or redemption, Consolidated EBITDA for such period shall be calculated as if the Company or such Restricted Subsidiary had not earned any interest income actually earned during such period in respect of the funds used to repay or redeem such Indebtedness or Preferred Stock;
(b) Consolidated Interest Expense attributable to interest on any Indebtedness (whether existing or being Incurred) computed on a pro forma basis and bearing a floating interest rate shall be computed as if the rate in effect on the Transaction Date (taking into account any Interest Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement has a remaining term in excess of 12 months or, if shorter, at least equal to the remaining term of such Indebtedness) had been the applicable rate for the entire period;
(c) pro forma effect shall be given to the creation, designation or redesignation of Restricted and Unrestricted Subsidiaries as if such creation, designation or redesignation had occurred on the first day of such Reference Period;
(d) pro forma effect shall be given to Asset Dispositions and Asset Acquisitions (including giving pro forma effect to the application of proceeds of any Asset Disposition) that occur during such Reference Period as if they had occurred and such proceeds had been applied on the first day of such Reference Period; and
(e) pro forma effect shall be given to asset dispositions and asset acquisitions (including giving pro forma effect to the application of proceeds of any asset disposition) that have been made by any Person that has become a Restricted Subsidiary or has been merged with or into the Company or any Restricted Subsidiary during such Reference Period and that would have constituted Asset Dispositions or Asset Acquisitions had such transactions occurred when such Person was a Restricted Subsidiary as if such asset dispositions or asset acquisitions were Asset Dispositions or Asset Acquisitions that occurred on the first day of such Reference Period;

provided that to the extent that clause (d) or (e) of this paragraph requires that pro forma effect be given to an Asset Acquisition or Asset Disposition (or asset acquisition or asset disposition), such pro forma calculation shall be based upon the four full fiscal quarters immediately preceding the Transaction Date of the Person, or division or line of business of the Person, that is acquired or disposed for which financial information is available.

“GAAP” means Hong Kong Financial Reporting Standards as in effect from time to time. All ratios and computations contained or referred to in the Indenture shall be computed in conformity with GAAP applied on a consistent basis.

“Guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness or other obligation of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (1) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation of such other

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Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise) or (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part), provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

“Hedging Obligation” of any Person means the obligations of such Person pursuant to any Commodity Agreement, Currency Agreement or Interest Rate Agreement.

“Holder” means the Person in whose name a Note is registered in the Note register.

“Incur” means, with respect to any Indebtedness or Capital Stock, to incur, create, issue, assume, Guarantee or otherwise become liable for or with respect to, or become responsible for, the payment of, contingently or otherwise, such Indebtedness or Capital Stock; provided that (1) any Indebtedness and Capital Stock of a Person existing at the time such Person becomes a Restricted Subsidiary (or fails to meet the qualifications necessary to remain an Unrestricted Subsidiary) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary and (2) the accretion of original issue discount shall not be considered an Incurrence of Indebtedness. The terms “Incurrence,” “Incurred” and “Incurring” have meanings correlative with the foregoing.

“Indebtedness” means, with respect to any Person at any date of determination (without duplication):

(1) all indebtedness of such Person for borrowed money;
(2) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
(3) all obligations of such Person in respect of letters of credit, bankers’ acceptances or other similar instruments;
(4) all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except Trade Payables;
(5) all Capitalized Lease Obligations and Attributable Indebtedness;
(6) all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided that the amount of such Indebtedness shall be the lesser of (a) the Fair Market Value of such asset at such date of determination and (b) the amount of such Indebtedness;
(7) all Indebtedness of other Persons Guaranteed by such Person to the extent such Indebtedness is Guaranteed by such Person;
(8) to the extent not otherwise included in this definition, Hedging Obligations; and
(9) all Disqualified Stock issued by such Person valued at the greater of its voluntary or involuntary liquidation preference and its maximum fixed repurchase price plus accrued dividends.

For the avoidance of doubt, a mandatory put option granted to a Person that obligates the Company or any Restricted Subsidiary to repurchase the Capital Stock of any Restricted Subsidiary or any other Person shall be deemed to be “Indebtedness.”

Notwithstanding the foregoing, Indebtedness shall not include any (1) capital commitments, pre-sale receipts in advance from customers, deferred payment obligations, or similar obligations Incurred in the ordinary course of business in connection with the acquisition, development, construction or improvement of real or personal property (including land use rights) to be used in a Permitted Business or (2) Entrusted Loans; provided that such Indebtedness is not reflected on the statement of financial position of the Company or any Restricted Subsidiary (contingent obligations and commitments referred to in a footnote to financial statements and not otherwise reflected on the statement of financial position will not be deemed to be reflected on such statement of financial position).

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The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above and, with respect to contingent obligations, the maximum liability upon the occurrence of the contingency giving rise to the obligation; provided that:

(1) the amount outstanding at any time of any Indebtedness issued with original issue discount is the face amount of such Indebtedness less the remaining unamortized portion of the original issue discount of such Indebtedness at such time as determined in conformity with GAAP,
(2) money borrowed and set aside at the time of the Incurrence of any Indebtedness in order to prefund the payment of the interest on such Indebtedness shall not be deemed to be “Indebtedness” so long as such money is held to secure the payment of such interest, and
(3) the amount of Indebtedness with respect to any Hedging Obligation shall be equal to the net amount payable by such Person if such Hedging Obligation terminated at or prior to that time due to a default by such Person.

“Independent Third Party” means any Person that is not an Affiliate of the Company.

“Intercreditor Agreement” has the meaning set forth under “– Security.”

“Interest Rate Agreement” means any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement, option or future contract or other similar agreement or arrangement designed to protect against fluctuations in interest rates.

“Investment” means:

(1) any direct or indirect advance, loan or other extension of credit to another Person;
(2) any capital contribution to another Person (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others);
(3) any purchase or acquisition of Capital Stock, Indebtedness, bonds, notes, debentures or other similar instruments or securities issued by another Person; or
(4) any Guarantee of any obligation of another Person to the extent such obligation is outstanding and to the extent guaranteed by such Person.

For the purposes of the provisions of the “Designation of Restricted and Unrestricted Subsidiaries” and “Limitation on Restricted Payments” covenants: (1) the Company will be deemed to have made an Investment in an Unrestricted Subsidiary in an amount equal to the Company’s proportional interest in the Fair Market Value of the assets (net of the Company’s proportionate interest in the liabilities owed to any Person other than the Company or a Restricted Subsidiary and that are not Guaranteed by the Company or a Restricted Subsidiary) of a Restricted Subsidiary that is designated an Unrestricted Subsidiary at the time of such designation and (2) any property transferred to or from any Person shall be valued at its Fair Market Value at the time of such transfer, as determined in good faith by the Board of Directors.

“Investment Grade” means a rating of “AAA,” “AA,” “A” or “BBB,” as modified by a “+” or “-” indication, or an equivalent rating representing one of the four highest Rating Categories, by S&P or any of its successors or assigns or a rating of “Aaa,” or “Aa,” “A” or “Baa,” as modified by a “1,” “2” or “3” indication, or an equivalent rating representing one of the four highest Rating Categories, by Moody’s, or any of its successors or assigns or the equivalent ratings of any internationally recognized rating agency or agencies, as the case may be, which shall have been designated by the Company as having been substituted for S&P or Moody’s or both, as the case may be.

“Investment Property” means any property that is owned and held by any PRC Restricted Subsidiary for long-term rental yield or for capital appreciation or both, or any hotel owned by the Company or any Restricted Subsidiary from which the Company or any Restricted Subsidiary derives or expects to derive operating income.

“January 2018 Notes” means the 10.25% Senior Notes due 2018 issued by the Company.

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“January 2018 Notes Indenture” means the indenture dated January 31, 2013, under which the January 2018 Notes were issued.

“JV Entitlement Amount” means, with respect to any JV Subsidiary Guarantor and its Subsidiaries, an amount that is equal to the product of (i) the Fair Market Value of the total assets of such JV Subsidiary and its Subsidiaries, on a consolidated basis (without deducting any Indebtedness or other liabilities of such JV Subsidiary Guarantor and its subsidiaries) as of the date of the last fiscal year end of the Company and (ii) a percentage equal to the direct equity ownership percentage of the Company and/or its Restricted Subsidiaries in the Capital Stock of such JV Subsidiary Guarantor and its Subsidiaries.

“JV Subsidiary Guarantee” has the meaning set forth under the caption “– The Subsidiary Guarantees.”

“JV Subsidiary Guarantor” means a Restricted Subsidiary that executes a JV Subsidiary Guarantee.

“Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including, without limitation, any conditional sale or other title retention agreement or lease in the nature thereof or any agreement to create any mortgage, pledge, security interest, lien, charge, easement or encumbrance of any kind).

“Measurement Date” means January 31, 2013.

“Minority Joint Venture” means any corporation, association or other business entity that is accounted for by the equity method of accounting in accordance with GAAP by the Company or a Restricted Subsidiary and primarily engaged in the Permitted Businesses, and such Minority Joint Venture’s Subsidiaries.

“Moody’s” means Moody’s Investors Service, Inc. and its successors.

“Net Cash Proceeds” means:

(1) with respect to any Asset Sale, the proceeds of such Asset Sale in the form of cash or cash equivalents, including payments in respect of deferred payment obligations (to the extent corresponding to the principal, but not interest, component thereof) when received in the form of cash or cash equivalents and proceeds from the conversion of other property received when converted to cash or cash equivalents, net of:
(a) brokerage commissions and other fees and expenses (including fees and expenses of counsel and investment banks) related to such Asset Sale;
(b) provisions for all taxes (whether or not such taxes will actually be paid or are payable) as a result of such Asset Sale without regard to the consolidated results of operations of the Company and its Restricted Subsidiaries, taken as a whole;
(c) payments made to repay Indebtedness or any other obligation outstanding at the time of such Asset Sale that either (x) is secured by a Lien on the property or assets sold or (y) is required to be paid as a result of such sale;
(d) appropriate amounts to be provided by the Company or any Restricted Subsidiary as a reserve against any liabilities associated with such Asset Sale, including, without limitation, pension and other post-employment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale, all as determined in conformity with GAAP; and
(2) with respect to any issuance or sale of Capital Stock, the proceeds of such issuance or sale in the form of cash or cash equivalents, including payments in respect of deferred payment obligations (to the extent corresponding to the principal, but not interest, component thereof) when received in the form of cash or cash equivalents and proceeds from the conversion of other property received when converted to cash or cash equivalents, net of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions and brokerage, consultant and other fees incurred in connection with such issuance or sale and net of taxes paid or payable as a result thereof.

“Non-Guaranteed Portion” means, at any time of determination with respect to all of the JV Subsidiary Guarantors then existing and their respective Restricted Subsidiaries, the aggregate value (without duplication)

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of the equity interests held by each Independent Third Party in any JV Subsidiary Guarantor as determined by multiplying (x) the total assets as shown on the balance sheet or statement of financial position of the relevant JV Subsidiary Guarantor for its most recently ended fiscal quarter period (or, in the case of the JV Subsidiary Guarantor executing such JV Subsidiary Guarantee and any other Restricted Subsidiary that became a JV Subsidiary Guarantor after the end of the most recently ended fiscal quarter period, as shown on the balance sheet or statement of financial position of such JV Subsidiary Guarantor after giving pro forma effect to the sale or issuance of Capital Stock to the relevant Independent Third Parties) by (y) the proportionate ownership of all Capital Stock held by such Independent Third Party in such JV Subsidiary Guarantor, provided that (A) assets attributable to any Unrestricted Subsidiary of such JV Subsidiary Guarantor and (B) assets which would be eliminated from the calculation of Total Assets of the Company for the relevant fiscal quarter period shall be excluded from the calculation of total assets in clause (x) above.

“Offer to Purchase” means an offer to purchase the Notes by the Company from the Holders commenced by mailing a notice by first class mail, postage prepaid, to the Trustee, the Paying and Transfer Agent and each Holder at its last address appearing in the Note register stating:

(1) the covenant pursuant to which the offer is being made and that all Notes validly tendered will be accepted for payment on a pro rata basis;
(2) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed) (the “Offer to Purchase Payment Date”);
(3) that any Note not tendered will continue to accrue interest pursuant to its terms;
(4) that, unless the Company defaults in the payment of the purchase price, any Note accepted for payment pursuant to the Offer to Purchase shall cease to accrue interest on and after the Offer to Purchase Payment Date;
(5) that Holders electing to have a Note purchased pursuant to the Offer to Purchase will be required to surrender the Note, together with the form entitled “Option of the Holder to Elect Purchase” on the reverse side of the Note completed, to the Paying and Transfer Agent at the address specified in the notice prior to the close of business on the Business Day immediately preceding the Offer to Purchase Payment Date;
(6) that Holders will be entitled to withdraw their election if the Paying and Transfer Agent receives, not later than the close of business on the third Business Day immediately preceding the Offer to Purchase Payment Date, a facsimile transmission or letter setting forth the name of such Holder, the principal amount of Notes delivered for purchase and a statement that such Holder is withdrawing his election to have such Notes purchased; and
(7) that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered; provided that each Note purchased and each new Note issued shall be in a principal amount of US$200,000 or integral multiples of US$1,000.

On one Business Day prior to Offer to Purchase Payment Date, the Company shall deposit with the Paying Agent money sufficient to pay the purchase price of all Notes or portions thereof so accepted. On the Offer to Purchase Payment Date, the Company shall (a) accept for payment on a pro rata basis Notes or portions thereof tendered pursuant to an Offer to Purchase; and (b) deliver, or cause to be delivered, to the Trustee all Notes or portions thereof so accepted together with an Officers’ Certificate specifying the Notes or portions thereof accepted for payment by the Company. The Paying and Transfer Agent shall promptly mail to the Holders of Notes so accepted payment in an amount equal to the purchase price, and the Trustee or an authenticating agent shall promptly authenticate and mail to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered; provided that each Note purchased and each new Note issued shall be in a principal amount of US$200,000 or integral multiples of US$1,000. The Company will publicly announce the results of an Offer to Purchase as soon as practicable after the Offer to Purchase Payment Date. The Company will comply with all applicable securities laws and regulations, in the event that the Company is required to repurchase Notes pursuant to an Offer to Purchase.

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The materials used in connection with an Offer to Purchase are required to contain or incorporate by reference information concerning the business of the Company and its Subsidiaries which the Company in good faith believes will assist such Holders to make an informed decision with respect to the Offer to Purchase, including a brief description of the events requiring the Company to make the Offer to Purchase, and any other information required by applicable law to be included therein. The offer is required to contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Offer to Purchase.

“Officer” means one of the executive officers of the Company or, in the case of a Subsidiary Guarantor or JV Subsidiary Guarantor, one of the directors or officers of such Subsidiary Guarantor or JV Subsidiary Guarantor, as the case may be.

“Officers’ Certificate” means a certificate signed by two Officers; provided, however, with respect to the Officers’ Certificate required to be delivered by any Subsidiary Guarantor under the Indenture, Officers’ Certificate means a certificate signed by one Officer if there is only one Officer in such Subsidiary Guarantor at the time such certificate is required to be delivered.

“Opinion of Counsel” means a written opinion from legal counsel who is acceptable to the Trustee.

“Original Issue Date” means the date on which the Notes are originally issued under the Indenture.

“Pari Passu Subsidiary Guarantee” means a guarantee by any Subsidiary Guarantor or any JV Subsidiary Guarantor of Indebtedness of the Company (including Additional Notes); provided that (1) the Company was permitted to Incur such Indebtedness under the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock” and (2) such guarantee ranks pari passu with any outstanding Subsidiary Guarantee of such Subsidiary Guarantor, or with any outstanding JV Subsidiary Guarantee of such JV Subsidiary Guarantor, as the case may be.

“Payment Default” means (1) any default in the payment of interest on any Note when the same becomes due and payable, (2) any default in the payment of principal of (or premium, if any, on) the Notes when the same becomes due and payable at maturity, upon acceleration, redemption or otherwise, (3) the failure by the Company to make or consummate a Change of Control Offer in the manner described under the caption “– Repurchase of Notes upon a Change of Control Triggering Event,” or an Offer to Purchase in the manner described under the caption “– Limitation on Asset Sales” or (4) any Event of Default specified in clause (5) of the definition of Events of Default.

“Permitted Businesses” means any business conducted by the Company and its Restricted Subsidiaries on the Original Issue Date and other businesses reasonably related, ancillary or complementary thereto, including, without limitation real estate acquisition, development, leasing and management, hotel acquisition, development, operation and management, and the acquisition, development, management and operation of leisure facilities and other infrastructure, in each case associated with real estate projects acquired, developed or managed, or intended in good faith to be acquired, developed or managed, by the Company or any Restricted Subsidiary.

“Permitted Holders” means any or all of the following:

(1) Mr. Wang Zhenhua;
(2) any Affiliate (other than an Affiliate as defined in clause (2) or (3) of the definition of Affiliate) of the Person specified in clause (1);
(3) the trust of the Person specified in clause (1) or the legal representative thereof; and
(4) any Person both the Capital Stock and the Voting Stock of which (or in the case of a trust, the beneficial interests in which) are owned 80% or more by Persons specified in clauses (1) or (2).

“Permitted Investment” means:

(1) any Investment in the Company or a Restricted Subsidiary that is primarily engaged in a Permitted Business or a Person which will, upon the making of such Investment, become a Restricted Subsidiary that is primarily engaged in a Permitted Business or be merged or consolidated with or into or transfer or convey all or substantially all its assets to, the Company or a Restricted Subsidiary that is primarily engaged in a Permitted Business;

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(2) Temporary Cash Investments;
(3) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses in accordance with GAAP;
(4) stock, obligations or securities received in satisfaction of judgments;
(5) an Investment in an Unrestricted Subsidiary consisting solely of an Investment in another Unrestricted Subsidiary;
(6) any Investment pursuant to a Hedging Obligation designed solely to protect the Company or any Restricted Subsidiary against fluctuations in commodity prices, interest rates or foreign currency exchange rates and not for speculation;
(7) receivables owing to the Company or any Restricted Subsidiary, if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms;
(8) Investments made by the Company or any Restricted Subsidiary consisting of consideration received in connection with an Asset Sale made in compliance with the covenant described under the caption “– Limitation on Asset Sales;”
(9) pledges or deposits (x) with respect to leases or utilities provided to third parties in the ordinary course of business or (y) otherwise described in the definition of “Permitted Liens” or made in connection with Liens permitted under the covenant described under the caption “– Limitation on Liens”;
(10) any Investment pursuant to Pre-Registration Mortgage Guarantees or Contractor Guarantees by the Company or any Restricted Subsidiary otherwise permitted to be Incurred under the Indenture;
(11) Investments in securities of trade creditors, trade debtors or customers received pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditor, trade debtor or customer;
(12) advances to contractors and suppliers for the acquisition of assets or consumables or services in the ordinary course of business that are recorded as deposits or prepaid expenses on the Company’s consolidated statement of financial position;
(13) deposits of pre-sale proceeds made in order to secure the completion and delivery of pre-sold properties and issuance of the related land use title in the ordinary course of business;
(14) deposits made in order to comply with statutory or regulatory obligations to maintain deposits for workers compensation claims and other purposes specified by statute or regulation from time to time in the ordinary course of business;
(15) deposits made in order to secure the performance of the Company or any Restricted Subsidiary and prepayments made in connection with the direct or indirect acquisition of real property or land use rights by the Company or any Restricted Subsidiary, in each case in the ordinary course of business;
(16) an acquisition of assets, Capital Stock or other securities by the Company or a Subsidiary for consideration to the extent such consideration consists solely of Common Stock of the Company;
(17) Guarantees permitted under clause 2(u) of the covenant under “– Limitation on Indebtedness and Preferred Stock”; and

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(18) any Investment (including any deemed Investment upon the redesignation of a Restricted Subsidiary as an Unrestricted Subsidiary or upon the sale of Capital Stock of a Restricted Subsidiary) by the Company or any Restricted Subsidiary in any Person (other than a Restricted Subsidiary), provided that:
(i) the aggregate of all Investments made under this clause (18) since the Original Issue Date shall not exceed in aggregate an amount equal to 20% of Total Assets. Such aggregate amount of Investments shall be calculated after deducting an amount equal to the net reduction in all Investments made under this clause (18) since the Original Issue Date resulting from:
- (A) payments of interest on Indebtedness, dividends or repayments of loans or advances made under this clause, in each case to the Company or any Restricted Subsidiary (except, in each case, to the extent any such payment or proceeds are included in the calculation of Consolidated Net Income),
- (B) the unconditional release of a Guarantee provided by the Company or a Restricted Subsidiary after the Original Issue Date under this clause (18) of an obligation of any such Person, or
- (C) to the extent that an Investment made after the Original Issue Date under this clause (18) is sold or otherwise liquidated or repaid for cash, the lesser of (x) cash return of capital with respect to such Investment (less the cost of disposition, if any) and (y) the initial amount of such Investment, not to exceed, in each case, the amount of Investments made by the Company or a Restricted Subsidiary after the Original Issue Date in any such Person pursuant to this clause (18);
(ii) he Person into which such Investment is made is primarily engaged in the Permitted Businesses;
(iii) none of the other shareholders or partners in such Person in which such Investment was made pursuant to this clause (18) is a Person described in clauses (x) or (y) of the first paragraph of the covenant under the caption “– Limitation on Transactions with Shareholders and Affiliates” (other than by reason of such shareholder or partner being an officer or director of the Company, a Restricted Subsidiary or a Minority Joint Venture or by reason of being a Restricted Subsidiary or a Minority Joint Venture);
(iv) no Default has occurred and is continuing or would occur as a result of such Investment;
(v) the Company or such Restricted Subsidiary owns, directly or indirectly, no less than 10% of the voting power of the outstanding Voting Stock of the Person into which such Investment is made (after giving effect to such Investment); and
(vi) at the time of such Investment, the Company could Incur at least US$1.00 of Indebtedness under the proviso in the first paragraph of part (1) of the covenant under the caption “– Limitation of Indebtedness and Preferred Stock.”.

For the avoidance of doubt, the value of each Investment made pursuant to this clause (18) shall be valued at the time such Investment is made.

“Permitted Liens” means:

(1) Liens for taxes, assessments, governmental charges or claims that are being contested in good faith by appropriate legal or administrative proceedings promptly instituted and diligently conducted and for which a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made;
(2) statutory and common law Liens of landlords and carriers, warehousemen, mechanics, suppliers, repairmen or other similar Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate legal or administrative proceedings promptly instituted and diligently conducted and for which a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made;

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(3) Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory or regulatory obligations, bankers’ acceptances, surety and appeal bonds, government contracts, performance and return-of-money bonds and other obligations of a similar nature incurred in the ordinary course of business (exclusive of obligations for the payment of borrowed money);
(4) leases or subleases granted to others that do not materially interfere with the ordinary course of business of the Company and its Restricted Subsidiaries, taken as a whole;
(5) Liens encumbering property or assets under construction arising from progress or partial payments by a customer of the Company or its Restricted Subsidiaries relating to such property or assets;
(6) Liens on property of, or on shares of Capital Stock or Indebtedness of, any Person existing at the time such Person becomes, or becomes a part of, any Restricted Subsidiary; provided that such Liens do not extend to or cover any property or assets of the Company or any Restricted Subsidiary other than the property or assets acquired; provided further that such Liens were not created in contemplation of or in connection with the transactions or series of transactions pursuant to which such Person became a Restricted Subsidiary;
(7) Liens in favor of the Company or any Restricted Subsidiary;
(8) Liens arising from the rendering of a final judgment or order against the Company or any Restricted Subsidiary that does not give rise to an Event of Default;
(9) Liens securing reimbursement obligations with respect to letters of credit that encumber documents and other property relating to such letters of credit and the products and proceeds thereof;
(10) Liens encumbering customary initial deposits and margin deposits, and other Liens that are within the general parameters customary in the industry and incurred in the ordinary course of business, in each case, securing Indebtedness under Hedging Obligations permitted by clause (2)(f) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”;
(11) Liens existing on the Original Issue Date;
(12) Liens securing Indebtedness which is Incurred to refinance secured Indebtedness which is permitted to be Incurred under clause (2)(e) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”; provided that such Liens do not extend to or cover any property or assets of the Company or any Restricted Subsidiary other than the property or assets securing the Indebtedness being refinanced;
(13) Liens under the Security Documents;
(14) Liens securing any Permitted Pari Passu Secured Indebtedness that complies with each of the requirements set forth under “– Security – Permitted Pari Passu Secured Indebtedness”;
(15) any interest or title of a lessor in the property subject to any operating lease;
(16) Liens securing Indebtedness of the Company or any Restricted Subsidiary under any PreRegistration Mortgage Guarantee which is permitted to be Incurred under clause (2)(g) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”;
(17) easements, rights-of-way, municipal and zoning ordinances or other restrictions as to the use of properties in favor of governmental agencies or utility companies that do not materially adversely affect the value of such properties or materially impair the use for the purposes of which such properties are held by the Company or any Restricted Subsidiary;
(18) Liens (including extensions and renewals thereof) upon real or personal property acquired after the Original Issue Date; provided that, (a) such Lien is created solely for the purpose of securing Indebtedness of the type described under clause (2)(h) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock” and such Lien is created prior to, at the time of or within 180 days after the later of the acquisition or the completion of development,

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construction or improvement of such property, (b) the principal amount of the Indebtedness secured by such Lien does not exceed 100% of the cost of such property, development, construction or improvement and (c) such Lien shall not extend to or cover any property or assets other than such item of property and any improvements on such item; provided that, in the case of clauses (b) and (c), such Lien may cover other property or assets (instead of or in addition to such item of property or improvements) and the principal amount of Indebtedness secured by such Lien may exceed 100% of such cost if (x) such Lien is incurred in the ordinary course of business and (y) the aggregate book value of property or assets as of the last day of the most recent fiscal quarter period for which consolidated financial statements of the Company (which the Company shall use its reasonable best efforts to compile in a timely manner) are available (which may be internal consolidated financial statements), if any such property or assets have been acquired since the date of such financial statements, the cost of such property or assets, subject to Liens incurred pursuant to this clause (18) does not exceed 130% of the aggregate principal amount of Indebtedness secured by such Liens;

(19) Liens on deposits of pre-sale proceeds made in order to secure the completion and delivery of pre-sold properties and issuance of the related land use title made in the ordinary course of business and not securing Indebtedness of the Company or any Restricted Subsidiary;
(20) Liens on deposits made in order to comply with statutory obligations to maintain deposits for workers compensation claims and other purposes specified by statute made in the ordinary course of business and not securing Indebtedness of the Company or any Restricted Subsidiary;
(21) Liens on deposits made in order to secure the performance of the Company or any Restricted Subsidiary in connection with the acquisition of real property or land use rights by the Company or any Restricted Subsidiary in the ordinary course of business and not securing Indebtedness of the Company or any Restricted Subsidiary;
(22) Liens on the Capital Stock of a PRC Project Company granted by the Company or any PRC Restricted Subsidiary in favor of any Trust Company Investor (including the sale or transfer of such Capital Stock to such Trust Company Investor) in respect of, and to secure, the Indebtedness permitted to be Incurred under clause (2)(p) of the “– Limitation on Indebtedness and Preferred Stock” covenant;
(23) Liens on one or more bank accounts to secure Bank Deposit Secured Indebtedness of the type described under clause 2(r) of the covenant described under “– Limitation on Indebtedness and Preferred Stock”;
(24) Liens on Investment Properties securing Indebtedness of the Company or any PRC Restricted Subsidiary permitted under clause (2)(q) of the covenant described under “– Limitation on Indebtedness and Preferred Stock”;
(25) Liens incurred or deposits made to secure Entrusted Loans;
(26) Liens securing Indebtedness which is permitted to be Incurred under clause (2)(n) of the covenant described under “– Limitation on Indebtedness and Preferred Stock”;
(27) Liens on the Capital Stock of the Person that is to be acquired under the relevant Staged Acquisition Agreement securing Indebtedness which is permitted to be Incurred under clause (2)(o) of the covenant described under “– Limitation on Indebtedness and Preferred Stock”;
(28) Liens securing Indebtedness of Restricted Subsidiaries (other than Subsidiary Guarantors or JV Subsidiary Guarantors) Incurred pursuant to clause (2)(t) of the covenant described under “– Limitation on Indebtedness and Preferred Stock”;
(29) Liens securing Indebtedness which is permitted to be Incurred under clause (2)(t) of the covenant described under “– Certain Covenants-Limitation on Indebtedness and Preferred Stock”; and
(30) Liens securing Indebtedness which is permitted to be Incurred under clause (2)(u) of the covenant described under “– Certain Covenants-Limitation on Indebtedness and Preferred Stock”;

provided that, with respect to the Collateral, “Permitted Liens” shall only refer to the Liens described in clauses (1), (6), (13) and (14) of this definition.

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“Permitted Pari Passu Secured Indebtedness” has the meaning set forth under “– Security – Permitted Pari Passu Secured Indebtedness.”

“Permitted Subsidiary Indebtedness” means Indebtedness of, and all Preferred Stock issued by, the Non-Guarantor Subsidiaries, taken as a whole; provided that, on the date of the Incurrence of such Indebtedness and after giving effect thereto and the application of the proceeds thereof, the aggregate principal amount outstanding of all such Indebtedness (excluding Public Indebtedness and any Indebtedness of any NonGuarantor Subsidiary permitted under clauses 2(a), (b), (d), (f) and (g) of the covenant described under the caption “– Limitation on Indebtedness and Preferred Stock”) does not exceed an amount equal to 15% of Total Assets.

“Person” means any individual, corporation, partnership, limited liability company, joint venture, trust, unincorporated organization or government or any agency or political subdivision thereof.

“PRC” means the People’s Republic of China, excluding Hong Kong Special Administrative Region, Macau and Taiwan.

“PRC Project Company” means any corporation, association or other business entity organized under the laws of the PRC primarily engaged in a Permitted Business which, at any time, is treated as a “subsidiary” of the Company under GAAP, other than an Unrestricted Subsidiary.

“Pre-Registration Mortgage Guarantee” means any Indebtedness of the Company or any Restricted Subsidiary consisting of a guarantee in favor of any bank or other similar financial institutions in the ordinary course of business of secured loans of purchasers of individual units of properties from the Company or any Restricted Subsidiary; provided that, any such guarantee shall be released in full on or before the perfection of a security interest in such properties under applicable law in favor of the relevant lender.

“Preferred Stock” as applied to the Capital Stock of any Person means Capital Stock of any class or classes that by its term is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over any other class of Capital Stock of such Person.

“PRC CJV” means any Subsidiary that is a Sino-foreign cooperative joint venture enterprise with limited liability, established in the PRC pursuant to the Law of the People’s Republic of China on Sino-foreign Cooperative Joint Ventures adopted on April 13, 1988 (as most recently amended on October 13, 2000) and the Detailed Rules for the Implementation of the Law of the People’s Republic of China on Sino-foreign Cooperative Joint Ventures promulgated on September 4, 1995, as such laws may be amended.

“PRC CJV Partner” means with respect to a PRC CJV, the other party to the joint venture agreement relating to such PRC CJV with the Company or any Restricted Subsidiary.

“PRC Restricted Subsidiary” means a Restricted Subsidiary organized under the laws of the PRC.

“Public Indebtedness” means any bonds, debentures, notes or similar debt securities issued in a public offering or a private placement (other than the Notes) to institutional investors.

“Rating Agencies” means (1) S&P and (2) Moody’s and (3) if S&P or Moody’s or both shall not make a rating of the Notes publicly available, a nationally recognized securities rating agency or agencies, as the case may be, selected by the Company, which shall be substituted for S&P or Moody’s or both, as the case may be.

“Rating Category” means (1) with respect to S&P, any of the following categories: “BB,” “B,” “CCC,” “CC,” “C” and “D” (or equivalent successor categories); (2) with respect to Moody’s, any of the following categories: “Ba,” “B,” “Caa,” “Ca,” “C” and “D” (or equivalent successor categories); and (3) the equivalent of any such category of S&P or Moody’s used by another Rating Agency. In determining whether the rating of the Notes has decreased by one or more gradations, gradations within Rating Categories (“+” and “-” for S&P; “1”, “2” and “3” for Moody’s; or the equivalent gradations for another Rating Agency) shall be taken into account (e.g., with respect to S&P, a decline in a rating from “BB+” to “BB,” as well as from “BB-” to “B+”, will constitute a decrease of one gradation).

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“Rating Date” means (1) in connection with a Change of Control Triggering Event, that date which is 90 days prior to the earlier of (x) a Change of Control and (y) a public notice of the occurrence of a Change of Control or of the intention by the Company or any other Person or Persons to effect a Change of Control or (2) in connection with actions contemplated under the caption “– Consolidation, Merger and Sale of Assets”, that date which is 90 days prior to the earlier of (x) the occurrence of any such actions as set forth therein and (y) a public notice of the occurrence of any such actions.

“Rating Decline” means (1) in connection with a Change of Control Triggering Event, the occurrence on, or within six months after the date of public notice of the occurrence of a Change of Control or the intention by the Company or any other Person or Persons to effect a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies) of any of the events listed below, or (2) in connection with actions contemplated under the caption “– Consolidation, Merger and Sale of Assets”, the notification by any of the Rating Agencies that such proposed actions will result in any of the events listed below:

(a) in the event the Notes are rated by both Moody’s and S&P on the Rating Date as Investment Grade, the rating of the Notes by either Rating Agency shall be below Investment Grade;
(b) in the event the Notes are rated by either, but not both, of the Rating Agencies on the Rating Date as Investment Grade, the rating of the Notes by such Rating Agency shall be below Investment Grade; or
(c) in the event the Notes are rated below Investment Grade by both Rating Agencies on the Rating Date, the rating of the Notes by either Rating Agency shall be decreased by one or more gradations (including gradations within Rating Categories as well as between Rating Categories).

“Reference Treasury Dealer” means each of any three investment banks of recognized standing that is a primary U.S. Government securities dealer in The City of New York, selected by the Company in good faith.

“Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to such Trustee by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such redemption date.

“Replacement Assets” means, on any date, property or assets (other than current assets) of a nature or type or that are used in a Permitted Business.

“Restricted Subsidiary” means any Subsidiary of the Company other than an Unrestricted Subsidiary.

“S&P” means Standard & Poor’s Ratings Services and its affiliates.

“Sale and Leaseback Transaction” means any direct or indirect arrangement relating to property (whether real, personal or mixed), now owned or hereafter acquired whereby the Company or any Restricted Subsidiary transfers such property to another Person and the Company or any Restricted Subsidiary leases it from such Person.

“Secured Parties” means the January 2018 Notes Trustee and the holders of the January 2018 Notes (or their representatives), the April 2016 Notes Trustee and the holders the April 2016 Notes (or their representatives), the Trustee and the Holders (or their representatives) once the Trustee accedes to the Intercreditor Agreement, and the holders of any other Permitted Pari Passu Indebtedness (or their trustee, agents or representatives) once such person accedes to the Intercreditor Agreement.

“Security Documents” means, collectively, the pledge agreements and any other agreements or instruments that may evidence or create any security interest in favor of the Trustee, the Collateral Agent and/or any Holders in any or all of the Collateral.

“Senior Indebtedness” of the Company or a Restricted Subsidiary, as the case may be, means all Indebtedness of the Company or the Restricted Subsidiary, as relevant, whether outstanding on the Original Issue Date or thereafter created, except for Indebtedness which, in the instrument creating or evidencing the same, is expressly stated to be subordinated in right of payment to (a) in respect of the Company, the Notes,

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(b) in respect of any Restricted Subsidiary that is a Subsidiary Guarantor, its Subsidiary Guarantee, or (c) in respect of any Restricted Subsidiary that is a JV Subsidiary Guarantor, its JV Subsidiary Guarantee; provided that Senior Indebtedness does not include (1) any obligation to the Company or any Restricted Subsidiary, (2) trade payables or (3) Indebtedness Incurred in violation of the Indenture.

“Staged Acquisition Agreement” means an agreement between the Company or a Restricted Subsidiary and an Independent Third Party (x) pursuant to which the Company or such Restricted Subsidiary agrees to acquire not less than a majority of the Capital Stock of a Person for consideration that is not more than the Fair Market Value of such Capital Stock of such Person at the time the Company or such Restricted Subsidiary enters into such Agreement and (y) which provides that the payment of the purchase price for such Capital Stock is made in more than one installment over a period of time.

“Stated Maturity” means, (1) with respect to any Indebtedness, the date specified in such debt security as the fixed date on which the final installment of principal of such Indebtedness is due and payable as set forth in the documentation governing such Indebtedness and (2) with respect to any scheduled installment of principal of or interest on any Indebtedness, the date specified as the fixed date on which such installment is due and payable as set forth in the documentation governing such Indebtedness.

“Subordinated Indebtedness” means any Indebtedness of the Company, any Subsidiary Guarantor or any JV Subsidiary Guarantor which is contractually subordinated or junior in right of payment to the Notes, any Subsidiary Guarantee or any JV Subsidiary Guarantee, as applicable, pursuant to a written agreement to such effect.

“Subordinated Shareholder Loan” means unsecured Indebtedness for borrowed money Incurred by the Company or any Restricted Subsidiary from but only for long as such Indebtedness is owed to, any Permitted Holder (other than the Company or any Restricted Subsidiary) as to which (a) the payment of principal of (and premium, if any) and interest and other payment obligations in respect of such Indebtedness is, by its terms or by the terms of any agreement or instrument pursuant to which such Indebtedness is issued or remains outstanding and an agreement (the “Subordination Agreement”) to be entered into among the holders of such Indebtedness (or trustees or agents therefor) and the Trustee, is expressly made subordinate to the prior payment in full of the Notes or the Subsidiary Guarantees, as the case may be, to at least the following extent: (i) no payments of principal of (or premium, if any) or interest on or otherwise due in respect of such Indebtedness may be permitted for so long as any Default exists; (ii) such Indebtedness may not (x) provide for payments of principal of such Indebtedness at the Stated Maturity thereof or by way of a sinking fund applicable thereto or by way of any mandatory redemption, defeasance, retirement or repurchase thereof by the Company or such Subsidiary Guarantor (including any redemption, retirement or repurchase which is contingent upon events or circumstances), in each case prior to the final Stated Maturity of the Notes or (y) permit redemption or other retirement (including pursuant to an offer to purchase made by the Company or any Restricted Subsidiary) of such other Indebtedness at the option of the holder thereof prior to the final Stated Maturity of the Notes, except that to the extent such redemption or other retirement is permitted under the covenant described under the caption “– Certain Covenants – Limitation on Restricted Payments” on the date of such redemption or other retirement, (iii) the Subordination Agreement will prevent the holders of such Indebtedness (or trustees or agents therefor) from pursuing remedies against the Company or any of the Restricted Subsidiaries or their respective assets or properties in an insolvency proceeding or in respect of a default under such Indebtedness and (iv) the Subordination Agreement will provide in the event that any payment is received by the holders of such Indebtedness (or any trustee or agent therefor) in respect of such Indebtedness where such payment is prohibited by one or more of the subordination provisions described in this definition, such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the Trustee on behalf of the Holders of the Notes, and (b) the terms thereof provide that interest (and premium, if any) thereon is paid solely in the form of pay-in-kind, or PIK, payments constituting additional Subordinated Shareholder Loans.

“Subsidiary” means, with respect to any Person, any corporation, association or other business entity of which more than 50% of the voting power of the outstanding Voting Stock is owned, directly or indirectly, by such Person and one or more other Subsidiaries of such Person.

“Subsidiary Guarantee” means any Guarantee of the obligations of the Company under the Indenture and the Notes by any Subsidiary Guarantor.

“Subsidiary Guarantor” means any initial Subsidiary Guarantor named herein and any other Restricted Subsidiary which guarantees the payment of the Notes pursuant to the Indenture and the Notes; provided that Subsidiary Guarantor will not include (a) any Person whose Subsidiary Guarantee has been released in accordance with the Indenture and the Notes or (b) any JV Subsidiary Guarantor.

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“Subsidiary Guarantor Pledgor” means any initial Subsidiary Guarantor Pledgor named herein and any other Subsidiary Guarantor which pledges Collateral to secure the obligations of the Company under the Notes and the Indenture and of such Subsidiary Guarantor under its Subsidiary Guarantee; provided that a Subsidiary Guarantor Pledgor will not include any person whose pledge under the Security Documents has been released in accordance with the Security Documents, the Indenture and the Notes.

“Temporary Cash Investment” means any of the following:

(1) direct obligations of the United States of America, any state of the European Economic Area, the People’s Republic of China and Hong Kong or any agency of any of the foregoing or obligations fully and unconditionally Guaranteed by the United States of America, any state of the European Economic Area, the People’s Republic of China and Hong Kong or any agency of any of the foregoing, in each case maturing within one year, which in the case of obligations of, or obligations Guaranteed by, any state of the European Economic Area, shall be rated at least “A” by S&P or Moody’s;
(2) time deposit accounts, certificates of deposit and money market deposits maturing within 180 days of the date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any state thereof, any state of the European Economic Area or Hong Kong, and which bank or trust company has capital, surplus and undivided profits aggregating in excess of US$100 million (or the Dollar Equivalent thereof) and has outstanding debt which is rated “A” (or such similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Section 3(a)(62) of the Exchange Act) or any money market fund sponsored by a registered broker dealer or mutual fund distributor;
(3) repurchase obligations with a term of not more than 30 days for underlying securities of the types described in clause (1) above entered into with a bank or trust company meeting the qualifications described in clause (2) above;
(4) commercial paper, maturing not more than 180 days after the date of acquisition thereof, issued by a corporation (other than an Affiliate of the Company) organized and in existence under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of “P-1” (or higher) according to Moody’s or “A-1” (or higher) according to S&P;
(5) securities, maturing within one year of the date of acquisition thereof, issued or fully and unconditionally Guaranteed by any state, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least “A” by S&P or Moody’s;
(6) any money market fund that has at least 95% of its assets continuously invested in investments of the types described in clauses (1) through (5) above; and
(7) demand or time deposit accounts, certificates of deposit, overnight or call deposits, money market deposits and principal protected structured deposit products (that if held to maturity (which shall not be more than one year) and can be withdrawn at any time with no more than six months’ notice) with (i) Industrial and Commercial Bank of China, China Construction Bank, Bank of China, Agricultural Bank of China, Bank of Communications, China Merchants Bank, Huaxia Bank, China Minsheng Banking Corp., Ltd., Jiangnan Rural Commercial Bank, Xiamen International Bank, Evergrowing Bank, Bank of Jiangsu, China Bohai Bank, Bank of Shanghai, Standard Chartered (China), Bank of Nanjing, China Guangfa Bank, Shenzhen Development Bank, Industrial Bank, Shanghai Pudong Development Bank, First Sino Bank, Postal Savings Bank of China, Bank of Suzhou, China Everbright Bank, Kunshan Rural Commercial Bank, China CITIC Bank, China Zheshang Bank Co., Ltd., The Bank of East Asia (China) Limited, Pingan Bank, Bank of China (Hong Kong) Limited, Bank of Changsha, Bank of Beijing, Bank of Dong Guan, Postal Savings Bank of China and Wuhan Rural Commercial Bank, (ii) any other bank, trust company or other financial institution organized under the laws of the PRC or Hong Kong whose long-term debt is rated as high or higher than any of those banks described in clause (i) of this paragraph or (iii) any other bank, trust company or other financial institution organized under the laws of the PRC or Hong Kong; provided that, in the case of clause (iii), such deposits do not exceed US$10.0 million (or the Dollar Equivalent thereof) with any single bank or US$30.0 million (or the Dollar Equivalent thereof) in the aggregate on any date of determination.

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“Total Assets” means, as of any date, the total consolidated assets of the Company and its Restricted Subsidiaries measured in accordance with GAAP as of the last day of the most recent fiscal quarter for which consolidated financial statements of the Company (which the Company shall use its reasonable best efforts to compile in a timely manner) are available (which may be internal consolidated financial statements); provided that only with respect to clause (2)(h) of “– Certain Covenants – Limitation on Indebtedness and Preferred Stock” covenant and the definition of “Permitted Subsidiary Indebtedness,” Total Assets shall be calculated after giving pro forma effect to include the cumulative value of all of the real or personal property or equipment the acquisition, development, construction or improvement of which requires or required the Incurrence of Indebtedness and calculation of Total Assets thereunder, as measured by the purchase price or cost therefor or budgeted cost provided in good faith by the Company or any Restricted Subsidiary to the bank or other similar financial institutional lender providing such Indebtedness, provided further that only with respect to the calculation of “Non-Guaranteed Portion,” in the case of a JV Subsidiary Guarantor executing a JV Subsidiary Guarantee and any other Restricted Subsidiary that became a JV Subsidiary Guarantor after the end of the most recently ended fiscal quarter, the amount of Total Assets shall be calculated after giving pro forma effect to the sale or issuance of Capital Stock to the relevant Independent Third Parties and provided further that with respect to the calculation of the percentage of Total Assets represented by the Consolidated Assets of the Offshore Non-Guarantor Subsidiaries, the amount of Total Assets shall be calculated after giving pro forma effect to any sale or issuance of Capital Stock to relevant Independent Third Parties.

“Trade Payables” means, with respect to any Person, any accounts payable or any other indebtedness or monetary obligation to trade creditors created, assumed or Guaranteed by such Person or any of its Subsidiaries arising in the ordinary course of business in connection with the acquisition of goods or services.

“Transaction Date” means, with respect to the Incurrence of any Indebtedness, the date such Indebtedness is to be Incurred and, with respect to any Restricted Payment, the date such Restricted Payment is to be made.

“Trust Company Investor” means an Independent Third Party that is a financial institution, including but not limited to a bank, a trust company, a securities management company, an asset management company or an insurance company organized under the laws of the PRC, or an Affiliate thereof, that Invests in any Capital Stock of a PRC Project Company.

“Unrestricted Subsidiary” means (1) any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors in the manner provided in the Indenture; and (2) any Subsidiary of an Unrestricted Subsidiary.

“U.S. Government Obligations” means securities that are (1) direct obligations of the United States of America for the payment of which its full faith and credit is pledged or (2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally Guaranteed as a full faith and credit obligation by the United States of America, which, in either case, are not callable or redeemable at the option of the Company thereof at any time prior to the Stated Maturity of the Notes, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such U.S. Government Obligation or a specific payment of interest on or principal of any such U.S. Government Obligation held by such custodian for the account of the holder of a depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of interest on or principal of the U.S. Government Obligation evidenced by such depository receipt.

“Voting Stock” means, with respect to any Person, Capital Stock of any class or kind ordinarily having the power to vote for the election of directors, managers or other voting members of the governing body of such Person.

“Wholly Owned” means, with respect to any Subsidiary of any Person, the ownership of all of the outstanding Capital Stock of such Subsidiary (other than any director’s qualifying shares or Investments by foreign nationals mandated by applicable law) by such Person or one or more Wholly Owned Subsidiaries of such Person; provided that Subsidiaries that are PRC CJVs shall not be considered Wholly Owned Subsidiaries unless such Person or one or more Wholly Owned Subsidiaries of such Person is entitled to 95% or more of the economic benefits distributable by such Subsidiary.

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TAXATION

The following summary of certain Cayman Islands, Hong Kong, PRC and United States tax consequences of the purchase, ownership and disposition of the Notes is based upon applicable laws, regulations, rulings and decisions as of the date of this offering memorandum, all of which are subject to change (possibly with retroactive effect). This discussion does not purport to be a comprehensive description of all the tax considerations that may be relevant to a decision to purchase, own or depose of the Notes and does not purport to deal with consequences applicable to all categories or investors, some of which may be subject to special rules. Persons considering the purchase of Notes should consult their own tax advisers concerning the tax consequences of the purchase, ownership and disposition of Notes, including such possible consequences under the laws of their country of citizenship, residence or domicile.

Cayman Islands Taxation

The following is a discussion of certain Cayman Islands income tax consequences of an investment in the Notes. The discussion is a general summary of present law, which is subject to prospective and retroactive change. It is not intended as tax advice, does not consider any investor’s particular circumstances, and does not consider tax consequences other than those arising under Cayman Islands law.

Under the laws of the Cayman Islands, payments of interest and principal on the Notes will not be subject to taxation and no withholding will be required on the payment of interest and principal or premium to any holder of the Notes, as the case may be, nor will gains derived from the disposal of the Notes be subject to Cayman Islands income or corporation tax. The Cayman Islands currently have no income, corporation or capital gains tax and no estate duty, inheritance tax or gift tax. The Cayman Islands are not party to any double taxation treaties.

No stamp duty is payable in respect of the issue of the Notes. An instrument of transfer in respect of a Note is stampable if executed in or brought into the Cayman Islands.

The Company has been incorporated under the laws of the Cayman Islands as an exempted company with limited liability and, as such, has obtained an undertaking from the Governor in Cabinet of the Cayman Islands as to tax concessions under the Tax Concessions Law (1999 Revision). In accordance with the provision of section 6 of The Tax Concessions Law (1999 Revision), the Governor in Cabinet undertakes with Future Land Development Holdings Limited:

That no law which is hereafter enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to the Company or its operations.
In addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable, on or in respect of the shares, debentures or other obligations of the Company, or by way of the withholding, in whole or part, of any relevant payment as defined in Section 6(3) of the Tax Concessions Law (1999 Revision).
These concessions shall be for a period of 20 years from July 4, 2006.

Hong Kong Taxation

Withholding Tax . No withholding tax in Hong Kong is payable on payments of principal (including any premium payable on redemption of the Notes) or interest in respect of the Notes.

Profits Tax . Hong Kong profits tax is charged on every person carrying on a trade, profession or business in Hong Kong in respect of assessable profits arising in or derived from Hong Kong from such trade, profession or business. Under the Inland Revenue Ordinance (Chapter 112 of the Laws of Hong Kong), or the Inland Revenue Ordinance, as it is currently applied, Hong Kong profits tax may be charged on revenue profits arising on the sale, disposal or redemption of the Notes where such sale, disposal or redemption is or forms part of a trade, profession or business carried on in Hong Kong.

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Interest on the Notes will be subject to Hong Kong profits tax where such interest has a Hong Kong source, and is received by or accrues to:

a financial institution (as defined in the Inland Revenue Ordinance) and arises through or from the carrying on by the financial institution of its business in Hong Kong;
a corporation carrying on a trade, profession or business in Hong Kong; or
a person, other than a corporation, carrying on a trade, profession or business in Hong Kong and such interest is in respect of the funds of the trade, profession or business.

Although no tax is imposed in Hong Kong in respect of capital gains, Hong Kong profits tax may be chargeable on trading gains arising on the sale or disposal of the Notes where such transactions are or form part of a trade, profession or business carried on in Hong Kong.

Stamp Duty . No Hong Kong stamp duty will be chargeable upon the issue or transfer (for so long as the register of holders of the Notes is maintained outside Hong Kong) of a Note.

PRC Taxation

The following summary of certain PRC tax consequences of the purchase, ownership and disposition of Notes is based upon applicable laws, rules and regulations in effect as of the date of this offering memorandum, all of which are subject to change (possibly with retroactive effect). This discussion does not purport to be a comprehensive description of all the tax considerations that may be relevant to a decision to purchase, own or dispose of the Notes and does not purport to deal with consequences applicable to all categories of investors, some of which may be subject to special rules. Persons considering the purchase of Notes should consult their own tax advisers concerning the tax consequences of the purchase, ownership and disposition of Notes, including such possible consequences under the laws of their country of citizenship, residence or domicile.

Taxation on Interest . The PRC CIT Law and its implementation regulations, effective January 1, 2008, impose a tax at the rate of 10% on interests paid to holders of the Notes that are “non-resident enterprises” so long as such “non-resident enterprise” holder does not have an establishment or place of business in China or, if there is an establishment or place of business in China, the relevant income is not effectively connected with such establishment or place of business in China, to the extent such interests are sourced within China. Pursuant to these provisions of the PRC tax law, despite many uncertainties with respect to their application, if we are considered a PRC resident enterprise, the interest payable to the non-resident enterprise holders on the Notes may be treated as income derived from sources within China and be subject to the PRC withholding tax. To the extent that China has entered into arrangements relating to the avoidance of double-taxation with any jurisdiction, such as Hong Kong, that allow a lower rate of withholding tax, such lower rate will apply to qualified investors in the Notes.

Taxation on Capital Gains . The PRC CIT Law and its implementation regulations impose a tax at the rate of 10% on capital gains realized by holders of the Notes that are “non-resident enterprises” so long as any such “non-resident enterprise” holder does not have an establishment or place of business in China or, if there is an establishment or place of business in China, the relevant gain is not effectively connected with such establishment or place of business in China, to the extent such capital gains are sourced within China. Pursuant to these provisions of the PRC CIT law, despite many uncertainties with respect to their application, if we are considered a PRC resident enterprise, the capital gains realized by holders of the Notes may be treated as income derived from sources within China and be subject to the PRC tax. To the extent that China has entered into arrangements relating to the avoidance of double-taxation with any jurisdiction, such as Hong Kong, that allow a lower rate of withholding tax, such lower rate will apply to qualified investors in the Notes.

Stamp duty . No PRC stamp tax will be chargeable upon the issue or transfer (for so long as the register of holders of the Notes is maintained outside Mainland China) of a Note.

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PLAN OF DISTRIBUTION

Subject to the terms and conditions set forth in a purchase agreement between us, the Subsidiary Guarantors and the Initial Purchasers, we have agreed to sell to the Initial Purchasers, and the Initial Purchasers have agreed, severally and not jointly, to purchase from us, the principal amount of the Notes set forth opposite its name below.

	Principal Amount
Initial Purchasers	of Notes

J.P. Morgan Securities plc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$120,000,000
Credit Suisse Securities (Europe) Limited. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$100,000,000
UBS AG, Hong Kong Branch. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$ 60,000,000
BNP Paribas, Hong Kong Branch. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$ 40,000,000
CLSA Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$ 20,000,000
China Merchants Securities (HK) Co., Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$ 10,000,000

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	US$350,000,000

Subject to the terms and conditions set forth in the purchase agreement, the Initial Purchasers have agreed, severally and not jointly, to purchase all of the Notes sold under the purchase agreement if any of the Notes are purchased. If an Initial Purchaser defaults, the purchase agreement provides that the purchase commitments of the non-defaulting Initial Purchasers may be increased or the purchase agreement may be terminated. The purchase agreement provides that the obligations of the Initial Purchasers to purchase the Notes are subject to approval of legal matters by counsel and to other conditions. The purchase agreement may be terminated by the Initial Purchasers in certain circumstances prior to the delivery and payment of the Notes. The Initial Purchasers reserve the right to withdraw, cancel or modify offers to investors and to reject orders in whole or in part.

We and the Subsidiary Guarantors have agreed to, jointly and severally, indemnify the Initial Purchasers against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the Initial Purchasers may be required to make in respect of those liabilities.

The Initial Purchasers or their affiliates may purchase the Notes for its or their own account and be allocated the Notes for asset management and/or proprietary purposes but not with a view to distribution and/or enter into transactions, including credit derivatives, such as asset swaps, repackaging and credit default swaps relating to the Notes and/or other securities of us or our subsidiaries or associates at the same time as the offer and sale of the Notes or in secondary market transactions. Such transactions would be carried out as bilateral trades with selected counterparties and separately from any existing sale or resale of the Notes to which this offering memorandum relates (notwithstanding that such selected counterparties may also be purchasers of the Notes).

The Initial Purchasers propose initially to offer the Notes at the offering price set forth on the cover page of this offering memorandum. After the initial offering, the offering price or any other term of the offering may be changed from time to time without notice by the Initial Purchasers. In addition, we have agreed with the Initial Purchasers that we will pay a rebate to certain private banks based on the principal amount of the Notes purchased by private bank clients.

Notes Are Not Being Registered

The Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees have not been and will not be registered under the Securities Act or any state securities laws, and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities law. Accordingly, the Notes are being offered and sold by the Initial Purchasers only outside the United States in compliance with Regulation S. Each purchaser of the Notes will be deemed to have made acknowledgments, representations and agreements as described under “Transfer Restrictions.”

New Issue of Notes

The Notes are a new issue of securities with no established trading market. Approval in-principle has been received for the listing and quotation of the Notes on the SGX-ST. The Initial Purchasers have advised us that they presently intend to make a market in the Notes after completion of the offering. However, they are under

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no obligation to do so and may discontinue any market-making activities in their sole discretion at any time without any notice. We cannot assure the liquidity of the trading market for the Notes. If an active trading market for the Notes does not develop, the market price and liquidity of the Notes may be adversely affected. If the Notes are traded, they may trade at a discount from their initial offering price, depending on prevailing interest rates, the market for similar securities, our operating performance and financial condition, general economic conditions and other factors.

No Sales of Similar Securities

We have agreed that, for a period of 90 days following the date of this offering memorandum, we will not, without the prior written consent of the Initial Purchasers, directly or indirectly, sell, offer, contract or grant any option to sell, pledge, transfer or establish an open “put equivalent position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise dispose of or transfer, or announce the offering of, or file any registration statement under the Securities Act in respect of, any debt securities or securities exchangeable for or convertible into debt securities issued or guaranteed by us (other than the Notes sold to the Initial Purchasers pursuant to the purchase agreement or the Subsidiary Guarantees). The Initial Purchasers in their sole discretion may release any of the securities subject to these lock-up agreements at any time without notice.

Short Positions and Stabilizing Transactions

In connection with the offering, the Stabilizing Manager, or any person acting for it, may purchase and sell the Notes in the open market. These transactions may include short sales, purchases on the open market to cover positions created by short sales and stabilizing purchases. Short sales involve the sale by the Stabilizing Manager, or any person acting for it, of a greater principal amount of the Notes than the Initial Purchasers are required to purchase in the offering. The Stabilizing Manager, or any person acting for it, must close out any short position by purchasing the Notes in the open market. A short position is more likely to be created if the Stabilizing Manager is concerned that there may be downward pressure on the price of the Notes in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions involve bids to purchase the Notes so long as the stabilizing bids do not exceed a specified maximum.

Similar to other purchase transactions, the purchases to cover the syndicate short sales and stabilizing purchases may have the effect of raising or maintaining the market price of the Notes or preventing or retarding a decline in the market price of the Notes. As a result, the price of the Notes may be higher than the price that might otherwise exist in the open market.

Neither we nor the Initial Purchasers make any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the Notes. In addition, neither we nor the Initial Purchasers make any representation that the Initial Purchasers will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice at any time. No assurance can be given as to the liquidity of, or the trading market for, the Notes.

Other Relationships

The Initial Purchasers and/or their affiliates have in the past engaged, and may in the future engage, in transactions with and perform services, including financial advisory, commercial banking and investment banking services, for us and our affiliates in the ordinary course of business, for which they received or will receive customary fees and commissions and reimbursement of expenses.

In addition, in the ordinary course of their various business activities, the Initial Purchasers and/or their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments of ours or our affiliates. The Initial Purchasers and/or their affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments. We and our affiliates may enter into hedging or other derivative transactions as part of our risk management strategy with one or more of the Initial Purchasers, which may include transactions relating to our obligations under the Notes. Our obligations under these transactions may be secured by cash or other collateral.

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Selling Restrictions

No action is being taken or is contemplated by us or the Initial Purchasers that would permit a public offering of the Notes or the Subsidiary Guarantees or possession or distribution of this offering memorandum or any amendment thereof, any supplement thereto or any other offering material relating to the Notes or the Subsidiary Guarantees in any jurisdiction where, or in any other circumstance in which, action for those purposes is required. Accordingly, the Notes may not be offered or sold, directly or indirectly, and neither this offering memorandum nor such other material may be distributed or published, in or from any country or jurisdiction except in compliance with any applicable rules and regulations of such country or jurisdiction.

Notice to Prospective Investors in the United Kingdom

This offering memorandum is for distribution only to persons who (i) fall within Article 43(2)(b) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the “ Financial Promotion Order ”), (ii) have professional experience in matters relating to investments falling within Article 19(5) of the Financial Promotion Order, (iii) are persons falling within Article 49(2)(a) to (d) (“high net worth companies, unincorporated associations etc”) of the Financial Promotion Order, (iv) are outside the United Kingdom, or (v) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000 (the “ FSMA ”)) in connection with the issue or sale of any securities may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as “relevant persons”). This offering memorandum is directed only at relevant persons and must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this offering memorandum relates is available only to relevant persons and will be engaged in only with relevant persons.

Each of the Initial Purchasers has represented, warranted and agreed that:

(1) it has only communicated or caused to be communicated, and will only communicate or cause to be communicated, any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) received by it in connection with the issue or sale of any Notes in circumstances in which section 21(1) of the FSMA does not apply to us or the Subsidiary Guarantors; and
(2) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Notes in, from or otherwise involving the United Kingdom.

Notice to Prospective Investors in the EEA

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a “Relevant Member State”), each Initial Purchaser has represented and agreed that, with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State, it has not made and will not make an offer of the Notes which are the subject of the offering contemplated by this offering memorandum to the public in that Relevant Member State other than:

(a) at any time to any legal entity which is a qualified investor as defined in the Prospectus Directive;
(b) at any time to fewer than 100, or if the Relevant Member State has implemented the relevant provision of the 2010 PD Amending Directive, 150, natural or legal persons (other than qualified investors as defined in the Prospectus Directive), as permitted under the Prospectus Directive, subject to obtaining the prior consent of the Initial Purchasers for any such offer; or
(c) at any time in any other circumstances falling within Article 3(2) of the Prospectus Directive,

provided that no such offer of Notes above shall require the Issuer or any Initial Purchaser to publish a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer to the public” in relation to any Notes in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Notes to be offered so as to enable an investor to decide to purchase or subscribe to the Notes, as the same may be varied in that Relevant Member State by any measure implementing the

– 256 –

Prospectus Directive in that Relevant Member State, the expression “Prospectus Directive” means Directive 2003/71/EC (and the amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in the Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU.

Notice to Prospective Investors in Hong Kong

The Notes may not be offered or sold in Hong Kong by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap. 32, Laws of Hong Kong), or (ii) to “professional investors” within the meaning of the SFO (Cap. 571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Winding Up and Miscellaneous Provisions) (Cap. 32, Laws of Hong Kong) and no advertisement, invitation or document relating to the Notes may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to the Notes which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the SFO and any rules made thereunder.

Notice to Prospective Investors in Japan

The Notes offered in this offering memorandum have not been and will not be registered under the Financial Instruments and Exchange Act of Japan. The Notes may not and will not, directly or indirectly, be offered or sold in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan) or to others for reoffering or resale, directly or indirectly, in Japan or to, or for the benefit of, any resident in Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act of Japan and other relevant laws and regulations of Japan.

Notice to Prospective Investors in the PRC

This offering memorandum does not constitute a public offer of the Notes, whether by way of sale or subscription, in the PRC. Other than to qualified domestic institutional investors in the PRC, the Notes are not being offered and may not be offered or sold, directly or indirectly, in the PRC to or for the benefit of, legal or natural persons of the PRC. According to the laws and regulatory requirements of the PRC, with the exception of qualified domestic institutional investors in the PRC, the Notes may, subject to the laws and regulations of the relevant jurisdictions, only be offered or sold to non-PRC natural or legal persons in any country other than the PRC.

Notice to Prospective Investors in Singapore

This offering memorandum has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this offering memorandum and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the Notes may not be circulated or distributed, nor may the Notes be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “ SFA ”), (ii) to a relevant person pursuant to Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275, of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

– 257 –

Where the Notes are subscribed or purchased under Section 275 of the SFA by a relevant person which

is:

a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or
a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor;

securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries’ rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the Notes pursuant to an offer made under Section 275 of the SFA except:

to an institutional investor or to a relevant person as defined in Section 275(2) of the SFA, or to any person arising from an offer referred to in Section 275(1A), or Section 276(4)(i)(B) of the SFA;
where no consideration is or will be given for the transfer;
where the transfer is by operation of law;
as specified in Section 276(7) of the SFA; or
as specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Shares and Debentures) Regulations 2005 of Singapore.

Notice to Prospective Investors in the British Virgin Islands

No invitation will be made directly or indirectly to any person resident in the British Virgin Islands to subscribe for any of the Notes but the Notes may be acquired by British Virgin Islands persons who receive the offer outside of the British Virgin Islands and in a manner which does not contravene the laws of the jurisdictions in which such offer is received.

Notice to Prospective Investors in the Cayman Islands

No Notes will be offered or sold to the public in the Cayman Islands.

Notice to Prospective Investors in Taiwan

The Notes have not been and will not be registered with the Financial Supervisory Commission of Taiwan pursuant to relevant securities laws and regulations and may not be sold, issued or offered within Taiwan through a public offering or in circumstances which constitutes an offer within the meaning of the Securities and Exchange Act of Taiwan that requires a registration or approval of the Financial Supervisory Commission of Taiwan. No person or entity in Taiwan has been authorized to offer, sell, give advice regarding or otherwise intermediate the offering and sale of the Notes in Taiwan.

Notice to Prospective Investors in Italy

The offering of the Notes has not been registered pursuant to Italian securities legislation and, accordingly, no Notes may be offered, sold or delivered, nor may copies of this offering circular or of any other document relating to the Notes be distributed in Italy, except:

(i) to qualified investors ( investitori qualificati ), pursuant to Article 100 of Legislative Decree No. 58 of February 24, 1998, as amended (the “Financial Services Act”) and as defined in Article 34-ter, first paragraph, letter b) of Commissione Nazionale per le Sociétá e la Borsa (“CONSOB”) Regulation No. 11971 of May 14, 1999, as amended from time to time (“Regulation No. 11971”); or
(ii) in other circumstances which are exempted from the rules on public offerings pursuant to Article 100 of the Financial Services Act and Article 34-ter of Regulation No. 11971.

– 258 –

Any offer, sale or delivery of the Notes or distribution of copies of this offering circular or any other document relating to the Notes in the Italy under (i) or (ii) above must be:

(a) made by an investment firm, bank or financial intermediary permitted to conduct such activities in the Republic of Italy in accordance with the Legislative Decree No. 385 (the “Banking Act”), the Financial Services Act of September 1, 1933, as amended, CONSOB Regulation No. 16190 of October 29, 2007 (as amended from time to time) and any other applicable law and regulations; and
(b) in compliance with Article 129 of the Banking Act, as amended, and the implementing guidelines of the Bank of Italy, as amended from time to time, pursuant to which the Bank of Italy may request information on the issue or the offer of securities in Italy; and
(c) in compliance with any other applicable laws and regulations or requirement imposed by CONSOB, the Bank of Italy or any other Italian authority.

– 259 –

TRANSFER RESTRICTIONS

Because of the following restrictions, purchasers are advised to consult their legal counsel prior to making any offer, sale, resale, pledge or other transfer of the Notes.

The Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any) have not been and will not be registered under the Securities Act and may not be offered, sold or delivered within the United States (as defined in Regulation S) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. Accordingly, the Notes are being offered and sold only outside the United States in offshore transactions in reliance on Regulation S under the Securities Act.

By its purchase of the Notes, including the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any), each purchaser will be deemed to have:

represented that it is purchasing the Notes, including the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any), for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a purchaser that is outside the United States;
acknowledged that the Notes, the Subsidiary Guarantees and the JV Subsidiary Guarantees (if any) have not been and will not be registered under the Securities Act and may not be offered or sold within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, in each case in accordance with any applicable laws of any state or territory of the Unites States and any foreign jurisdiction;
agreed that it will inform each person to whom it transfers the Notes of any restrictions on transfer of such Notes;
understood and agreed that the Notes will be represented by the Global Notes and that transfers thereto are restricted as described under “Description of the Notes – Book-Entry Delivery and Form”;
understood and agreed that if in the future it decides to resell, pledge or otherwise transfer any Notes represented by the Global Notes or any beneficial interest in any Notes represented by the Global Notes, such Notes may be resold, pledged or transferred only in accordance with the requirements of the legends set forth in paragraph 6 below;
understood that the Notes represented by the Global Notes will bear a legend to the following effect unless otherwise agreed to by the Company and the holder thereof:

THIS SECURITY AND THE GUARANTEE RELATED TO THIS SECURITY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY JURISDICTION AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OR DELIVERED IN THE UNITED STATES UNLESS SUCH SECURITIES AND GUARANTEES ARE REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS THEREOF IS AVAILABLE; and

acknowledged that the Company, the Subsidiary Guarantors, the JV Subsidiary Guarantors (if any), the Transfer Agent, the Initial Purchasers, the Trustee and others will rely upon the truth and accuracy of the foregoing acknowledgements, representations and agreements; and agreed that if any of the acknowledgements, representations or agreements deemed to have been made by its purchase of the Notes is no longer accurate, it shall promptly notify the Company, the Subsidiary Guarantors, the JV Subsidiary Guarantors (if any), the Transfer Agent, the Trustee and the Initial Purchasers; and represented that if it is acquiring any Notes as a fiduciary or agent for one or more investor accounts, it has sole investment discretion with respect to each such account and has full power to make the foregoing acknowledgements, representations and agreements on behalf of each such account.

– 260 –

RATINGS

The Notes are expected to be rated B+ by S&P and B1 by Moody’s. The ratings reflect the rating agencies’ assessment of the likelihood of timely payment of the principal of and interest on the Notes. The ratings do not address the payment of any Additional Amounts and do not constitute recommendations to purchase, hold or sell the Notes inasmuch as such ratings do not comment as to market price or suitability for a particular investor. Each such rating should be evaluated independently of any other rating on the Notes, on other securities of ours, or on us. In addition, we have been assigned a long-term corporate credit rating of BB- with a stable outlook by Standard and Poor’s Rating Services and a corporate family rating of Ba3 with a stable outlook by Moody’s. We cannot assure you that the ratings will remain in effect for any given period or that the ratings will not be revised by such rating agencies in the future if in their judgment circumstances so warrant.

LEGAL MATTERS

Certain legal matters with respect to the Notes will be passed upon for us by Maples and Calder as to matters of Cayman Islands law, Shearman & Sterling as to matters of Hong Kong, United States federal and New York law and Shu Jin Law Firm as to matters of PRC law. Certain legal matters will be passed upon for the Initial Purchasers by Paul Hastings as to matters of United States federal and New York law and Commerce & Finance Law Offices as to matters of PRC law.

INDEPENDENT AUDITOR

Our audited consolidated financial statements as of and for each of the years ended December 31, 2012 and 2013, included in this offering memorandum, have been audited by PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, as stated in their report appearing herein.

– 261 –

GENERAL INFORMATION

Consents

We have obtained all necessary consents, approvals and authorizations in the Cayman Islands and Hong Kong in connection with the issue and performance of the Notes and the Subsidiary Guarantees. The entering into of the Indenture and the issue of the Notes have been authorized by a resolution of our board of directors dated July 8, 2014.

Documents Available

For so long as any of the Notes is outstanding, copies of the Indenture may be inspected free of charge during normal business hours on any weekday (except public holidays) at the corporate trust office of the Trustee.

For so long as any of the Notes is outstanding, copies of our audited financial statements for the last two financial years, if any, may be obtained during normal business hours on any weekday (except public holidays) at the corporate trust office of the Trustee.

Clearing Systems and Settlement

The Notes have been accepted for clearance through the facilities of Euroclear and Clearstream with a Common Code of 108680857 for the Notes. The International Securities Identification Number is XS1086808570 for the notes. Only Notes evidenced by a Global Note have been accepted for clearance through Euroclear and Clearstream.

Listing of the Notes

Approval in-principle has been received for the listing and quotation of the Notes on the SGX-ST. The SGX-ST assumes no responsibility for the correctness of any of the statements made or opinions or reports contained in this offering memorandum. The listing and quotation of the Notes on the SGX-ST is not to be taken as an indication of the merits of us, the Notes, the Subsidiary Guarantees or the JV Subsidiary Guarantees (if any). The Notes will be traded on the SGX-ST in a minimum board lot size of US$200,000 for so long as the Notes are listed on the SGX-ST.

For so long as the Notes are listed on the SGX-ST and the rules of the SGX-ST so require, we will appoint and maintain a paying agent in Singapore where the Notes may be presented or surrendered for payment or redemption in the event that a Global Note is exchanged for definitive Notes. In addition, in the event that a Global Note is exchanged for definitive Notes, an announcement of such exchange will be made by or on behalf of us through the SGX-ST and such announcement will include all material information with respect to the delivery of the definitive Notes, including details of the paying agent in Singapore.

– 262 –

INDEX TO FINANCIAL INFORMATION

Audited Consolidated Financial Statements of Future Land Development Holdings Limited as of and for the Year Ended December 31, 2012, with Independent Auditor’s Report

Independent Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-2
Consolidated Statement of Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-4
Statement of Financial Position of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-6
Consolidated Statement of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-7
Consolidated Statement of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-8
Consolidated Statement of Changes in Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-9
Consolidated Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-11
Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-12

Audited Consolidated Financial Statements of Future Land Development Holdings Limited as of and for the Year Ended December 31, 2013, with Independent Auditor’s Report

Independent Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-132
Consolidated Statement of Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-134
Statement of Financial Position of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-136
Consolidated Statement of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-137
Consolidated Statement of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-138
Consolidated Statement of Changes in Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-139
Consolidated Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-141
Notes to the Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	F-142

Note: The audited consolidated financial statements of the Company as of and for the years ended December 31, 2012 and 2013, with independent auditor’s reports set out herein have been reproduced from the Company’s annual reports for the years ended December 31, 2012 and 2013, respectively, and page references are references to pages set forth in such annual reports. The Chinese translation is for reference only. Should there by any inconsistency between English and Chinese versions, English should prevail.

– F-1 –

獨立核數師報告 InDepenDent AuDItor’s report

==> picture [77 x 56] intentionally omitted <==

致新城發展控股有限公司股東

（於開曼群島註冊成立的有限責任公司）

to tHe sHAreHoLDers oF Future LAnD DeVeLopMent HoLDInGs LIMIteD

(incorporated in the Cayman Islands with limited liability)

本核數師（以下簡稱「我們」）已審計列載於第F-3頁至第 F-130頁新城發展控股有限公司（以下簡稱「貴公司」）及其子公司（統稱「貴集團」）的合併財務報表，此合併財務報表包括於2012年12月31日的合併和公司資產負債表與截至該日止年度的合併利潤表、合併全面收益表、合併權益變動表及合併現金流量表，以及主要會計政策概要及其他附註解釋資料。

董事就合併財務報表須承擔的責任

貴公司董事須負責根據香港會計師公會頒佈的香港財務報告準則及香港《公司條例》的披露規定編製合併財務報表，以令合併財務報表作出真實而公平的反映，及落實其認為編製合併財務報表所必要的內部控制，以使合併財務報表不存在由於欺詐或錯誤而導致的重大錯誤陳述。

核數師的責任

我們的責任是根據我們的審計對該等合併財務報表作出意見，僅向整體股東報告我們的意見，除此之外本報告別無其他目的。我們不會就本報告的內容向任何其他人士負上或承擔任何責任。

We have audited the consolidated financial statements of Future Land Development Holdings Limited (the “Company”) and its subsidiaries (together, the “Group”) set out on pages F-3 to F-130, which comprise the consolidated and company statement of financial position as at 31 December 2012, and the consolidated statement of income, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

DIRECTORS’ RESPONSIBILITY FOR THE CONSOLIDATED FINANCIAL STATEMENTS

The directors of the Company are responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with Hong Kong Financial Reporting Standards issued by the Hong Kong Institute of Certified Public Accountants and the disclosure requirements of the Hong Kong Companies Ordinance, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these consolidated financial statements based on our audit and to report our opinion solely to you, as a body, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report.

F-1

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-2 –

獨立核數師報告（續） InDepenDent AuDItor’s report (Cont’d)

==> picture [77 x 56] intentionally omitted <==

我們已根據香港會計師公會頒佈的香港審計準則進行審計。該等準則要求我們遵守道德規範，並規劃及執行審計，以合理確定合併財務報表是否不存在任何重大錯誤陳述。

We conducted our audit in accordance with Hong Kong Standards on Auditing issued by the Hong Kong Institute of Certified Public Accountants. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement.

審計涉及執行程序以獲取有關合併財務報表所載金額及披露資料的審計憑證。所選定的程序取決於核數師的判斷，包括評估由於欺詐或錯誤而導致合併財務報表存在重大錯誤陳述的風險。在評估該等風險時，核數師考慮與該公司編製合併財務報表以作出真實而公平的反映相關的內部控制，以設計適當的審計程序，但目的並非對公司內部控制的有效性發表意見。審計亦包括評價董事所採用會計政策的合適性及所作出會計估計的合理性，以及評價合併財務報表的整體列報方式。

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of consolidated financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the consolidated financial statements.

我們相信，我們所獲得的審計憑證能充足和適當地為我們的審計意見提供基礎。

意見

我們認為，該等合併財務報表已根據香港財務報告準則真實而公平地反映貴公司及貴集團於2012年12月31日的事務狀況，及貴集團截至該日止年度的利潤及現金流量，並已按照香港《公司條例》的披露規定妥為編製。

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINION

In our opinion, the consolidated financial statements give a true and fair view of the state of affairs of the Company and of the Group as at 31 December 2012, and of the Group’s profit and cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards and have been properly prepared in accordance with the disclosure requirements of the Hong Kong Companies Ordinance.

羅兵咸永道會計師事務所

執業會計師

pricewaterhouseCoopers

Certified Public Accountants

香港，2013年3月27日

Hong Kong, 27 March 2013

F-2

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-3 –

合併資產負債表 ConsoLiDateD statement oF FinanCiaL Position

於2012年12月31日 As at 31 December 2012

			於12月31日 as at 31 December	於12月31日 as at 31 December
			2012年	2011年
			2012	2011
		附註	人民幣千元人民幣千元
		Note	RmB'000	RMB'000
資產	assets
非流動資產	non-current assets
物業、廠房和設備	Property, plant and equipment	7	117,074	117,016
投資物業	Investment properties	8	3,105,600	2,443,200
無形資產	Intangible assets	9	7,267	5,341
於聯營公司的投資	Investments in associates	10	229,890	235,000
遞延所得稅資產	Deferred income tax assets	24	361,193	362,640
可供出售金融資產	Available-for-sale financial assets	11	181,187	156,000
土地使用權	Land use rights	12	367,248	367,248
			4,369,459	3,686,445
流動資產	Current assets
租賃土地預付款項	Prepayments for leasehold land	13	4,313,847	2,689,155
完工待售或在建銷售物業	Properties held or under development	14	24,493,752 24,227,066
	for sale
貿易及其他應收款項和	Trade and other receivables and	15	1,666,266	1,761,606
預付款項	prepayments
受限制現金	Restricted cash	17	1,148,089	314,536
現金和現金等價物	Cash and cash equivalents	17	4,852,130	4,221,558
			36,474,084 33,213,921
資產總額	total assets		40,843,543 36,900,366
所有者權益	oWneRs’ eQUitY
本公司權益持有人應佔	Capital and reserves attributable to
股本及儲備	equity holders of the Company
已發行及繳足股本	Issued and fully paid capital	18	4,617	3,466
儲備	Reserves	20	5,746,486	3,176,350
			5,751,103	3,179,816
非控股權益	non-controlling interests		2,643,924	2,022,133
權益總額	total equity		8,395,027	5,201,949

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-3

– F-4 –

合併資產負債表（續） ConsoLiDateD statement oF FinanCiaL Position (Cont’d)

於2012年12月31日 As at 31 December 2012

			於12月31日 as at 31 December	於12月31日 as at 31 December
			2012年	2011年
			2012	2011
		附註	人民幣千元人民幣千元
		Note	RmB'000	RMB'000
負債	LiaBiLities
非流動負債	non-current liabilities
借款	Borrowings	21	4,509,670	6,649,200
遞延所得稅負債	Deferred income tax liabilities	24	402,872	343,237
			4,912,542	6,992,437
流動負債	Current liabilities
貿易和其他應付款項	Trade and other payables	23	9,597,029	6,627,089
預售物業預收款項	Advances from pre-sale of properties	22	11,663,869 12,775,020
即期所得稅負債	Current income tax liabilities		1,143,835	1,085,703
借款	Borrowings	21	5,130,436	4,217,363
應付股息	Dividends payable		805	805
			27,535,974 24,705,980
負債總額	total liabilities		32,448,516 31,698,417
權益及負債總額	total equity and liabilities		40,843,543 36,900,366
流動資產淨值	net current assets		8,938,110	8,507,941
資產總額減流動負債	total assets less current liabilities		13,307,569 12,194,386

第F-11頁至第F-130頁的附註構成本財務報表的一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

tan Weimin 譚為民 Director 董事

Huang maoli 黃茂莉 Director 董事

F-4 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-5 –

本公司資產負債表

STATEMENT OF FINANCIAL POSITION OF THE COMPANY

於2012年12月31日 As at 31 December 2012

			於12月31日	於12月31日
			As at 31	December
			2012年		2011年
			2012		2011
		附註	人民幣千元	人民幣千元
		Note	RMB'000		RMB'000
資產	ASSETS
非流動資產	Non-current assets
於子公司的投資	Investments in subsidiaries	16	424,271		387,574
流動資產	Current assets
貿易及其他應收款項	Trade and other receivables	15	718,417		–
現金和現金等價物	Cash and cash equivalents	17	895,307		4,626
			1,613,724		4,626
資產總額	Total assets		2,037,995		392,200
所有者權益	OWNERS’ EQUITY
本公司權益持有人	Capital and reserves attributable to
應佔股本及儲備	equity holders of the Company
已發行及繳足股本	Issued and fully paid capital	18	4,617		3,466
儲備	Reserves	20	2,019,589		384,330
權益總額	Total equity		2,024,206		387,796
流動負債及負債總額	Current liabilities and total liabilities
貿易和其他應付款項	Trade and other payables	23	13,789		4,404
權益及負債總額	Total equity and liabilities		2,037,995		392,200
流動資產淨值	Net current assets		1,599,935		222
資產總額減流動負債	Total assets less current liabilities		2,024,206		387,796

第F-11頁至第F-130頁之附註為財務報表之一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

Tan Weimin 譚為民 Director 董事

Huang Maoli

黃茂莉 Director 董事

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-5

– F-6 –

合併利潤表 ConsoLiDateD statement oF inCome

截至2012年12月31日止年度 For the year ended 31 December 2012

			截至12月31日止年度	截至12月31日止年度
			Year ended 31 December
			2012年	2011年
			2012	2011
		附註	人民幣千元	人民幣千元
		Note	RmB'000	RMB'000
收入	Revenue	25	17,517,266	10,767,254
銷售成本	Cost of sales	27	(13,587,371)	(7,743,687)
毛利	Gross profit		3,929,895	3,023,567
投資物業公允價值收益	Fair value gains on investment properties	8	31,086	273,493
銷售和營銷成本	Selling and marketing costs	27	(474,921)	(388,091)
行政開支	Administrative expenses	27	(569,883)	(465,941)
其他收入	Other income	26	9,475	39,493
其他開支	Other expenses	26	(4,347)	(20,240)
其他收益－淨額	Other gains – net	26	13,626	58,076
經營利潤	operating profit		2,934,931	2,520,357
財務收入	Finance income	28	48,052	19,406
融資成本	Finance costs	28	(159,712)	(154,548)
融資成本－淨額	Finance costs – net		(111,660)	(135,142)
應佔聯營公司業績	Share of results of an associated company	10	(5,110)	–
除所得稅前利潤	Profit before income tax		2,818,161	2,385,215
所得稅開支	Income tax expense	30	(1,232,777)	(941,284)
年內利潤	Profit for the year		1,585,384	1,443,931
應佔年內利潤：	attributable to:
本公司權益持有人	Equity holders of the Company		930,819	886,886
非控股權益	Non-controlling interests		654,565	557,045
			1,585,384	1,443,931
本公司權益持有人應佔	earnings per share for profit attributable
利潤的每股盈利	to equity holders of the Company
－基本及攤薄	– Basic and diluted	31	RmB0.21	RMB0.21
股息	Dividends	32	283,400	–

第F-11頁至第F-130頁之附註為財務報表之一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

F-6 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-7 –

合併全面收益表 ConsoLiDateD statement oF ComPReHensiVe inCome

截至2012年12月31日止年度 For the year ended 31 December 2012

			截至12月31日止年度
			Year ended 31 December
			2012年 2011年
			2012 2011
		附註	人民幣千元人民幣千元
		Note	RmB'000 RMB'000
年內利潤	Profit for the year		1,585,384 1,443,931
其他全面收益	other comprehensive income		– –
年內全面收益總額	total comprehensive income for the year		1,585,384 1,443,931
應佔年內全面收益總額：	attributable to:
本公司權益持有人	Equity holders of the Company		930,819 886,886
非控股權益	Non-controlling interests		654,565 557,045
			1,585,384 1,443,931

第F-11頁至第F-130頁的附註構成本財務報表的一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-7

– F-8 –

合併權益變動表

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 截至2012年12月31日止年度 For the year ended 31 December 2012

本公司權益持有人應佔

			Attributable to	equity holders of the company	equity holders of the company
		股本	股份溢價	其他儲備	保留盈利	小計	非控股權益	權益總額
		Share	Share	Other	Retained		Non-controlling	Total
		capital	premium	reserves	earnings	Sub-total	interests	equity
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
		（附註18）	（附註20）	（附註20）	（附註20）
		(Note 18)	(Note 20)	(Note 20)	(Note 20)
於2012年1月1日的結餘	Balance at 1 January 2012	3,466	360,020	(214,198)	3,030,528	3,179,816	2,022,133	5,201,949
全面收益	comprehensive income
年內利潤	Profit for the year	–	–	–	930,819	930,819	654,565	1,585,384
其他全面收益	Other comprehensive income	–	–	–	–	–	–	–
全面收益總額	Total comprehensive income	–	–	–	930,819	930,819	654,565	1,583,612
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
	(Note 18)	1,151	1,602,620	–	–	1,603,771	–	1,603,771
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee
	services	–	–	36,697	–	36,697	–	36,697
子公司股息	Dividends of subsidiaries	–	–	–	–	–	(32,774)	(32,774)
擁有人的投入	Total contributions by and
及分配總額	distributions to owners	1,151	1,602,620	36,697	–	1,640,468	(32,774)	1,607,694
於2012年12月31日的結餘	Balance at 31 December 2012	4,617	1,962,640	(177,501)	3,961,347	5,751,103	2,643,924	8,395,027

F-8 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-9 –

合併權益變動表（續） CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Cont’d) 截至2012年12月31日止年度 For the year ended 31 December 2012

本公司權益持有人應佔

Attributable to equity holders of the Company

		股本	股份溢價	其他儲備	保留盈利	小計	非控股權益	權益總額
		Share	Share	Other	Retained		Non-controlling	Total
		capital	premium	reserves	earnings	Sub-total	interests	equity
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
		（附註18）	（附註20）	（附註20）	（附註20）
		(Note 18)	(Note 20)	(Note 20)	(Note 20)
於2011年1月1日的結餘	Balance at 1 January 2011	–	–	118,326	2,143,642	2,261,968	1,491,306	3,753,274
全面收益	Comprehensive income
年內利潤	Profit for the year	–	–	–	886,886	886,886	557,045	1,443,931
其他全面收益	Other comprehensive income	–	–	–	–	–	–	–
全面收益總額	Total comprehensive income	–	–	–	886,886	886,886	557,045	1,443,931
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
	(Note 18)	3,466	360,020	(360,049)	–	3,437	–	3,437
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee
	services	–	–	13,468	–	13,468	–	13,468
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註19）	(Note 19)
－前僱員、高級僱員及	– value of former employees,
業務合夥人服務價值	officers and business
	partners services	–	–	14,057	–	14,057	–	14,057
子公司股息	Dividends of subsidiaries	–	–	–	–	–	(26,218)	(26,218)
擁有人的投入	Total contributions by and
及分配總額	distributions to owners	3,466	360,020	(332,524)	–	30,962	(26,218)	4,744
於2011年12月31日的結餘	Balance at 31 December 2011	3,466	360,020	(214,198)	3,030,528	3,179,816	2,022,133	5,201,949

第F-11頁至第F-130頁之附註為財務報表之一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-9

– F-10 –

合併現金流量表

ConsoLiDateD statement oF CasH FLows

截至2012年12月31日止年度 For the year ended 31 December 2012

			截至12月31日止年度	截至12月31日止年度
			Year ended 31 December
			2012年	2011年
			2012	2011
		附註	人民幣千元	人民幣千元
		Note	RmB'000	RMB'000
經營活動	operating activities
經營活動所得現金	Cash generated from operations	34	3,161,944	797,414
已付利息	Interest paid		(1,023,291)	(979,208)
已付中國所得稅	PRC income tax paid		(561,268)	(417,865)
已付中國土地增值稅	PRC land appreciation tax paid		(514,816)	(350,916)
經營活動所得╱（所用）	net cash generated from/(used in)
現金淨額	operating activities		1,062,569	(950,575)
投資活動	investing activities
添置投資物業	Additions of investment properties		(551,308)	(748,277)
添置物業、廠房及設備	Additions of property, plant and equipment		(20,925)	(21,760)
出售投資物業所得款項	Proceeds from disposal of investment
	properties		–	5,450
出售物業、廠房及設備	Proceeds from disposal of property,
所得款項	plant and equipment	34	835	4,113
添置無形資產	Additions of intangible assets	9	(3,457)	(4,458)
於聯營公司的投資	Investments in associates	10	–	(225,000)
收購可供出售金融資產	Acquisition of available-for-sale
	financial assets	11	(25,187)	(53,066)
出售子公司，扣除相關出售現金	Disposal of subsidiaries, net of cash disposed		–	(16)
出售可供出售金融資產	Proceeds from disposal of
所得款項	available-for-sale financial assets	11	–	103,332
已收股息	Dividends received	26	5,042	3,750
已收利息	Interest received	28	48,052	19,406
投資活動所用現金淨額	net cash used in investing activities		(546,948)	(916,526)
融資活動	Financing activities
借款所得款項	Proceeds from borrowings		6,249,311	6,830,403
償還借款	Repayments of borrowings		(7,475,768)	(4,422,975)
與融資活動相關的	Increase in restricted cash relating to
受限制現金增加	financing activities	17	(229,589)	(206,000)
向非控股股東支付股息	Dividends paid to non-controlling interests		(32,774)	(64,018)
發行普通股所得款項	Proceeds from issuance of ordinary shares	18	1,668,936	–
支付股份發行成本	Payments of share issuance costs	18	(65,165)	–
融資活動所得現金淨額	net cash generated from financing
	activities		114,951	2,137,410
現金和現金等價物增加淨額	net increase in cash and cash equivalents		630,572	270,309
年初的現金和現金等價物	Cash and cash equivalents at beginning
	of the year		4,221,558	3,951,249
年末的現金和現金等價物	Cash and cash equivalents at end
	of the year	17	4,852,130	4,221,558

第F-11頁至第F-130頁之附註為財務報表之一部分。

The notes on pages F-11 to F-130 are an integral part of these financial statements.

F-10

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-11 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

1 一般資料

新城發展控股有限公司（「本公司」）於2010年4月23 日根據開曼群島公司法（2010年修訂本）在開曼群島註冊成立為獲豁免有限公司。自2012年12月3日起，註冊辦事處地址已由Scotia Centre, 4th Floor, George Town, Grand Cayman KY1-1112, Cayman Islands更改為Floor 4, Willow House, Cricket Square, P.O. Box 2804, Grand Cayman KY1-1112, Cayman Islands。

1 GENERAL INFORMATION

Future Land Development Holdings Limited (the “Company”) was incorporated in the Cayman Islands on 23 April 2010 as an exempted company with limited liability under the Companies Law (2010 Revision) of the Cayman Islands. The address of its registered office has been changed from Scotia Centre, 4th Floor, George Town, Grand Cayman KY1-1112, Cayman Islands to Floor 4, Willow House, Cricket Square, P.O. Box 2804, Grand Cayman KY1-1112, Cayman Islands since 3 December 2012.

本公司及其子公司（統稱「本集團」）主要在中華人民共和國（「中國」）從事物業發展及物業投資業務。本公司的母公司為富域香港投資有限公司（「Wealth Zone Hong Kong」），本公司的最終控股公司為First Priority Group Limited，兩家公司均於英屬處女群島註冊成立。本集團最終控股方為王振華先生（「王先生」或「控股股東」）。

The principal activities of the Company and its subsidiaries (together, the “Group”) are property development and property investment in the People’s Republic of China (the “PRC”). The Company’s parent company is Wealth Zone Hong Kong Investments Limited (“Wealth Zone Hong Kong”) and the Company’s ultimate holding company is First Priority Group Limited, both of which are incorporated in the British Virgin Islands. The ultimate controlling party of the Group is Mr. Wang Zhenhua (“Mr. Wang” or the “Controlling Shareholder”).

為籌備本公司股份首次在香港聯合交易所有限公司（「聯交所」）主板上市，本集團進行重組（「重組」），據此，本公司成為組成本集團各子公司之控股公司。重組之詳情載於本公司日期為2012年11月19日之招股章程。

To prepare for the initial listing of the Company’s shares on the Main Board of The Stock Exchange of Hong Kong Limited (the “Stock Exchange”), the Group has undertaken a reorganisation (the “Reorganisation”) pursuant to which the Company became the holding company of the subsidiaries comprising the Group. Details of the Reorganisation are set out in the prospectus of the Company dated 19 November 2012.

本公司股份於2012年11月29日開始在聯交所上市（「上市」）。

The Company’s shares began to list on the Stock Exchange on 29 November 2012 (the “Listing”).

除另有指明外，合併財務報表以人民幣千元（「人民幣千元」）為單位呈列。

The consolidated financial statements are presented in thousands of Renminbi (RMB’000), unless otherwise stated.

本公司董事會（「董事會」）於2013年3月27日批准及授權刊發此等載於第F-3頁至第F-130頁的合併財務報表。

These consolidated financial statements set out on pages F-3 to F-130 have been approved and authorised for issue by the board of directors (the “Board”) of the Company on 27 March 2013.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-11

– F-12 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要

編製合併財務報表所採用的主要會計政策載於下文。除另有指明外，此等政策於所呈列的年度貫徹應用。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of the consolidated financial statements are set out below. These policies have been consistently applied to the years presented, unless otherwise stated.

2.1 編製基準

合併財務報表已根據由香港會計師公會（「香港會計師公會」）頒佈的香港財務報告準則（「香港財務報告準則」）按歷史成本慣例編製，並已就按公允價值列賬的可供出售金融資產及投資物業的重估而作出修訂。

2.1 Basis of preparation

The consolidated financial statements have been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRSs”) issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”) and under the historical cost convention, as modified by the revaluation of available-for-sale financial assets and investment properties which are carried at fair value.

上文附註1所述就上市進行的重組指涉及合併控股股東王先生控制的多間實體，及以共同控股股東合併會計法列賬。此等實體的淨資產採用控股股東而言的現有賬面值合併。業績由最早呈報日期或合併實體首次受到共同控股股東控制的日期（若為較後發生日期）而不依據本集團實際取得擁有權的日期予以合併。於重組發生之時概無確認作為商譽代價之金額或收購人於被收購人的可識別資產、負債及或然負債的公平淨值超出成本之金額。

The Reorganisation for the Listing referred to in Note 1 above involved combination of a number of entities that were under the common control of the Controlling Shareholder, Mr. Wang, and was accounted for using merger accounting. The net assets of these entities were consolidated using the existing book values from the Controlling Shareholder’s perspective. The results were combined from the earliest date presented or since the date when the combining entities first came under the common control, where this was at a later date, regardless of the date the Group took actual ownership. No amount was recognised in consideration for goodwill or excess of acquirers’ interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time the Reorganisation took place.

編製符合香港財務報告準則的合併財務報表需要使用若干關鍵會計估算。管理層在應用本集團會計政策過程中亦需行使其判斷。涉及高度的判斷或高度複雜性的範疇或涉及對合併財務報表屬重大假設和估算的範疇在附註5中披露。

The preparation of consolidated financial statements in conformity with HKFRSs requires the use of certain critical accounting estimates. It also requires management to exercise judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 5 below.

F-12

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-13 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2012年採納之經修訂準則

以下對現有準則之修訂於2012年1月1日開始之財政年度首次強制應用，而且與本集團之業務有關：

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(i) Amended standard adopted by the Group in 2012

The following amendment to existing standard is mandatory for the first time for the financial year beginning on 1 January 2012 and is relevant to the Group’s operations.

於2010年12月，香港會計師公會修訂香港會計準則第12號「所得稅」，加入按公允價值計量之投資物業產生遞延稅項資產或負債之計量原則之例外情況。香港會計準則第12號規定主體應視乎其是否預期透過使用或出售收回資產之賬面值，來計量資產之遞延稅項。此修訂引入一項可推翻之假設，即按公允價值入賬之投資物業乃透過出售全數收回。此項修訂自2012年1月1日或之後開始之年度期間追溯應用，並可提早採納。本集團已於 2012年採納此項修訂，但此項修訂並未對本集團的合併財務報表造成重大影響，原因是本集團所持有投資物業之業務模式，乃隨着時間獲取投資物業絕大部分之經濟利益，而非透過出售物業。因此，上述假設遭推翻，而相關遞延稅項並未重新計量。

In December 2010, the HKICPA amended HKAS 12 ‘Income Taxes’ to introduce an exception to the principle for the measurement of deferred tax assets or liabilities arising on an investment property measured at fair value. HKAS 12 requires an entity to measure the deferred tax relating to an asset depending on whether the entity expects to recover the carrying amount of the asset through use or sale. The amendment introduces a rebuttable presumption that an investment property measured at fair value is recovered entirely by sale. The amendment is applicable retrospectively to annual periods beginning on or after 1 January 2012 with early adoption permitted. The Group has adopted this amendment in 2012 but this amendment has no significant impact on the Group’s consolidated financial statements, as the investment properties of the Group are held with a business model to consume substantially all of the economic benefits embodied in the investment properties over time, rather than through sale. Accordingly, the presumption is rebutted and related deferred tax is not remeasured.

F-13

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-14 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.1 編製基準（續）

(ii) 本集團於2012年後將採納的新訂╱經修訂準則及修訂本

若干香港財務報告準則的新訂╱經修訂及現有準則的修訂本已頒佈但於2012年1月1日開始的年度仍未生效。該等與本集團營運相關的準則列示如下：

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)
(ii) New/revised standards and amendments that are required to be adopted by the Group after 2012

C e r t a i n n e w / re v i s e d s t a n d a rd s a n d amendments to existing standards of HKFRSs have been published but are not yet effective for the annual period beginning on 1 January 2012. Those that are relevant to the Group’s operations are as follows:

香港會計準則第1號財務報表的呈列（於2012年7月1日（修訂本）或之後開始的年度生效）
香港財務報告準則披露－抵銷金融資產及金融負債第7號（修訂本）（於2013年1月1日或之後開始的年度生效）
香港會計準則第19號僱員福利（於2013年1月1日或之後（2011年修訂）開始的年度生效）
香港財務報告準則金融工具（於2015年1月1日或之後第9號開始的年度生效）
香港財務報告準則合併財務報表（於2013年1月1日或第10號之後開始的年度生效）
香港財務報告準則共同安排（於2013年1月1日或之後第11號開始的年度生效）
香港財務報告準則披露於其他實體的權益（於2013年第12號 1月1日或之後開始的年度生效）
香港財務報告準則公允價值計量（於2013年1月1日或第13號之後開始的年度生效）
香港會計準則第27號個別財務報表（於2013年1月1日或（2011年修訂）之後開始的年度生效）
香港會計準則第28號於聯營公司和合資企業的投資（2011年修訂）（於2013年1月1日或之後開始的年度生效）

HKAS 1 Presentation of Financial Statements (Amendments) (effective for annual periods beginning on or after 1 July 2012) HKFRS 7 Disclosures – Offsetting Financial Assets (Amendments) and Financial Liabilities (effective for annual periods beginning on or after 1 January 2013) HKAS 19 Employee Benefits (effective for annual (Revised 2011) periods beginning on or after 1 January 2013) HKFRS 9 Financial Instruments (effective for annual periods beginning on or after 1 January 2015) HKFRS 10 Consolidated Financial Statements (effective for annual periods beginning on or after 1 January 2013) HKFRS 11 Joint Arrangements (effective for annual periods beginning on or after 1 January 2013) HKFRS 12 Disclosure of Interests in Other Entities (effective for annual periods beginning on or after 1 January 2013) HKFRS 13 Fair Value Measurement (effective for annual periods beginning on or after 1 January 2013) HKAS 27 Separate Financial Statements (effective for (Revised 2011) annual periods beginning on or after 1 January 2013) HKAS 28 Investments in Associates and Joint (Revised 2011) Ventures (effective for annual periods beginning on or after 1 January 2013)

F-14

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-15 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.1 編製基準（續）

(ii) 本集團於2012年後將採納的新訂╱經修訂準則及修訂本 （續）

於2012本集團並無提早採納已頒佈但未生效的任何新訂╱經修訂準則及對現有準則的修訂本。本集團正評估此等新訂╱經修定準則及修訂本的影響，並且不預期於生效採納時將對本集團之經營業績及財政狀況造成任何重大影響。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)
(ii) New/revised standards and amendments that are required to be adopted by the Group after 2012 (Cont’d)

The Group has not early adopted any new/ revised standards and amendments to the existing standards that have been issued but are not effective in 2012. The Group is in the process of making an assessment on the impact of these new/revised standards and amendments and does not anticipate that the adoption when they become effective will result in any material impact on the Group’s results of operations and financial position.

2.2 子公司

2.2.1 合併

子公司指本集團有權對其財務及營運政策進行控制的所有實體，一般擁有其過半數投票權的股權。於評估本集團是否控制另一實體時，會考慮現時可行使或可轉換的潛在投票權的存在及影響。當本集團持有不超過50%的投票權，但因實際控制權而可控制其財務及營運政策時，其亦會評估是否存在控制權。實際控制權可在加強少數股東權利或股東間合約條款等情況下產生。

2.2 Subsidiaries

2.2.1 consolidation

Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. The Group also assesses existence of control where it does not have more than 50% of the voting power but is able to govern the financial and operating policies by virtue of de-facto control. De-facto control may arise from circumstances such as enhanced minority rights or contractual terms between shareholders, etc.

子公司由控制權轉讓予本集團（或根據共同控股股東合併會計法轉讓予控股股東）當日起全面合併入賬，並於控制權終止當日不再合併入賬。

Subsidiaries are fully consolidated from the date on which control is transferred to the Group (or to the Controlling Shareholder under merger accounting). They are de-consolidated from the date that control ceases.

集團內公司間交易、結餘及因集團內公司間交易而產生之收支會予以對銷。確認於資產的公司間交易所產生的溢利和虧損亦予以對銷。子公司的會計政策已按需要作出改動，以確保與本集團所採納者相符。

Inter-company transactions, balances, income and expenses on transactions between group companies are eliminated. Profits and losses resulting from inter-company transactions that are recognised in assets are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-15

– F-16 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.2 子公司（續）

2.2.1 合併（續）

子公司的業績及權益中的非控股權益分別於合併資產負債表、合併利潤表、合併全面收益表及合併權益變動表中單獨列示。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.1 consolidation (Cont’d)

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of financial position, consolidated statement of income, consolidated statement of comprehensive income and consolidated statement of changes in equity respectively.

(i) 業務合併

本集團採用如下文所述的收購會計法為業務合併列賬，惟如上文附註2.1所述的方法入賬的重組除外。

(i) Business combinations

The Group applies the acquisition method as described below to account for business combinations, except for the Reorganisation which had been accounted for as stated in Note 2.1 above.

根據收購會計法，收購一家子公司的轉讓代價包括所轉讓資產、所產生的對被收購人前所有者之負債及本集團所發行股權的公允價值。所轉讓代價亦包括任何或有對價安排所產生的資產及負債的公允價值。收購相關成本於產生時列為開支。於業務合併時所收購的可識別資產及所承擔的負債及或然負債，初始按收購日的公允價值計量。按逐項收購基準，本集團以公允價值或非控股權益按比例應佔被收購人可識別淨資產已確認金額，確認任何被收購人非控股權益。

Under the acquisition method of accounting, the consideration transferred for the acquisition of a subsidiary comprises the fair values of the assets transferred, the liabilities incurred to former owners of the acquiree and the equity interests issued by the Group. The consideration transferred also includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisitionby-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the noncontrolling interest’s proportionate share in the recognised amounts of the acquiree’s identifiable net assets.

F-16

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-17 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.2 子公司（續）

2.2.1 合併（續）

(i) 業務合併（續）

倘業務合併分階段進行，本集團先前持有的被收購人股本權益於收購日期的賬面值會按收購日期的公允價值重新計量；有關重新計量產生的損益在合併利潤表確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.1 consolidation (Cont’d)

(i) Business combinations (Cont’d)

If the business combination is achieved in stages, the acquisition date carrying value of the Group’s previously held equity interest in the acquiree is re-measured to fair value at the acquisition date; any gains or losses arising from such re-measurement are recognised in consolidated statement of income.

本集團所轉讓的任何或然代價將在收購當日按公允價值確認。被視為一項資產或負債的或然代價公允價值的後續變動，將按照香港會計準則第39號於合併利潤表作為其他全面收益變動確認。分類為權益的或然代價毋須重新計量，而其後結算於權益入賬。

Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with HKAS 39 either in consolidated statement of income or as a change to other comprehensive income. Contingent consideration that is classified as equity is not remeasured, and its subsequent settlement is accounted for within equity.

轉讓代價、被收購人的任何非控股權益金額及任何先前於被收購人的股權於收購日期的公允價值的總和超逾本集團應佔所收購可識別淨資產的公允價值的差額入賬列作商譽。倘此等金額的總和低於所收購子公司的可識別淨資產的公允價值，並且所有有關金額的計量已獲檢討，則該差額會直接於合併利潤表內確認。

The excess of the sum of consideration transferred, the amount of any noncontrolling interest in the acquiree and the acquisition-date fair value of any previously held equity interest in the acquiree over the fair value of the identifiable net assets acquired is recorded as goodwill. If the sum of those amounts are less than the fair value of the identifiable net assets of the subsidiary acquired and the measurement of all amounts has been reviewed, the difference is recognised directly in consolidated statement of income.

F-17

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-18 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.2 子公司 （續）

2.2.1 合併（續）

(ii) 不導致失去控制權的子公司所有權權益變動

不導致失去控制權的與非控制權益進行的交 ─ 易入賬列作權益交易即以他們作為擁有人的身份與其他擁有人進行交易。任何已付代價公允價值與所購買相關應佔子公司淨資產賬面值的差額列作權益。向非控制性權益出售產生的盈虧亦列作權益。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)
2.2.1 consolidation (Cont’d)

(ii) Changes in ownership interests in subsidiaries without loss of control

Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the other owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity.

(iii) 出售子公司

本集團失去控制權時，於實體的任何保留權益按失去控制權當日的公允價值重新計量，有關賬面值變動在損益確認。就其後入賬列作聯營公司、合資企業或金融資產的保留權益，其公允價值為初始賬面值。此外，先前於其他全面收益確認與該實體有關的任何金額按猶如本集團已直接出售有關資產或負債的方式入賬。此可能意味先前在其他全面收益確認的金額重新分類至損益。

(iii) Disposal of subsidiaries

When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value at the date when control is lost, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

F-18

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-19 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.2 子公司（續）

2.2.2 獨立財務報表

於本公司資產負債表中，於子公司之投資乃以成本扣除減值入賬（附註16）。成本亦包括與投資直接相關的應佔成本。子公司之業績按已收及應收股息計入公司之賬內。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.2 Separate financial statements

In the Company’s statement of financial position, the investments in subsidiaries are stated at cost less impairment (Note 16). Cost also includes direct attributable costs of investment. The results of subsidiaries are accounted for by the Company on the basis of dividend received and receivable.

當收到於子公司的股息時，而該股息超過子公司在宣派股息期間之全面收益總額，或在獨立財務報表之投資賬面值超過被投資方淨資產（包括商譽）在合併財務報表之賬面值時，則必須對有關投資進行減值測試。

Impairment testing of the investments in subsidiaries is required upon receiving dividends from these investments if the dividend exceeds the total comprehensive income of the subsidiary in the period the dividend is declared or if the carrying amount of the investment in the separate financial statements exceeds the carrying amount in the consolidated financial statements of the investee’s net assets including goodwill.

2.3 聯營公司

聯營公司指本集團對其有重大影響但無控制權或共同控制權的所有實體，一般擁有其20%至50%投票權的股權。於聯營公司的投資乃以權益法入賬。根據權益法，投資初始按成本確認，並會增減賬面值以確認投資者在收購日期後佔被投資方損益及其他儲備變動的比例。本集團於聯營公司的投資包括於收購時已識別的商譽（經扣除任何累計減值虧損）。

2.3 Associates

Associates or associated companies are all entities over which the Group has significant influence but not control or joint control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting. Under the equity method, the investment is initially recognised at cost, and the carrying amount is increased or decreased to recognise the investor’s share of the profit or loss and other reserve movements of the investee after the date of acquisition. The Group’s investments in associates include goodwill (net of any accumulated impairment loss) identified on acquisition.

倘於聯營公司的所有權權益減少，而重大影響力獲保留，則先前於其他全面收益確認的金額僅有按比例部分重新劃分為損益（倘適用）。

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-19

– F-20 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.3 聯營公司（續）

本集團所佔聯營公司的收購後盈虧乃於合併利潤表內確認，而其所佔其他全面收益收購後變動則於其他全面收益內確認，並相應調整投資的賬面金額。當本集團應佔聯營公司虧損相等於或超逾其於聯營公司的權益（包括任何其他無抵押應收款項）時，則本集團不會進一步確認虧損，除非本集團已代聯營公司承擔法定或推定義務或支付款項。本集團在每個報告日期釐定於聯營公司的投資是否存在客觀減值證據。一旦存在減值證據，本集團會按聯營公司可收回金額與其賬面值差額計算減值金額，並於合併利潤表「應佔聯營公司利潤╱（虧損）」確認有關金額。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.3 Associates (Cont’d)

The Group’s share of its associates’ post-acquisition profits or losses is recognised in the consolidated statement of income, and its share of postacquisition movement in other comprehensive income is recognised in other comprehensive income with a corresponding adjustment to the carrying amount of the investment. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred legal or constructive obligations or made payments on behalf of the associate. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount adjacent to ‘share of profit/(loss) of an associate’ in the consolidated statement of income.

來自本集團與聯營公司間上游及下游交易的損益於本集團的財務報表中確認並以無關連投資者於聯營公司的權益為限。未變現虧損亦會對銷，除非有關交易證明所轉讓資產已出現減值。聯營公司的會計政策已作必要更改，以確保與本集團所採納者保持一致。

Profits and losses resulting from upstream and downstream transactions between the Group and its associates are recognised in the Group’s financial statements only to the extent of unrelated investor’s interests in the associates. Unrealised losses are eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the Group.

於聯營公司投資所產生的攤薄盈虧在合併利潤表內確認。

Dilution gains and losses arising in investments in associates are recognised in the consolidated statement of income.

F-20 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-21 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.4 分部報告

經營分部乃以與提交予主要經營決策者（「主要經營決策者」）的內部報告一致的方式呈報。主要經營決策者負責分配資源及評估經營分部表現，並已確定為作出戰略決策的王先生。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.4 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (the “CODM”). The CODM, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as Mr. Wang who makes strategic decisions.

管理層根據主要經營決策者審核的用於作出戰略決策的報告釐定經營分部。

Management has determined the operating segments based on the reports reviewed by the CODM that are used to make strategic decisions.

2.5 外幣換算

(i) 功能及呈列貨幣

本集團的各實體財務報表所列的項目，均以該實體經營所在主要經濟環境所使用的貨幣（「功能貨幣」）計量。由於本集團的大部分資產及營運位於中國，故其財務報表以人民幣呈列，人民幣乃本公司的功能貨幣及本集團的呈列貨幣。

2.5 Foreign currency translation

(i) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). Since the majority of the assets and operations of the Group are located in the PRC, the financial statements are presented in RMB, which is the functional currency of the Company and the presentation currency of the Group.

(ii) 交易及結餘

外幣交易均按交易當日的現行匯率換算為功能貨幣，或於項目獲重新計量時按估值日期的匯率換算。因上述交易結算及按年底匯率兌換以外幣計值的貨幣資產及負債而產生的匯兌盈虧，均於合併利潤表內確認。

(ii)

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated statement of income.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-21

– F-22 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.5 外幣換算（續）

(iii) 集團公司

倘本集團的所有實體（全部均非採用嚴重通脹經濟體系的貨幣）的功能貨幣有別於呈列貨幣，則其業績及財務狀況會按下列方法換算為呈列貨幣：

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.5 Foreign currency translation (Cont’d)

(iii) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(a) 現時集團實體的每份資產負債表內的資產與負債按該資產負債表結算日的收市匯率換算；
(a) assets and liabilities for each statement of financial position of the Group entities are translated at the closing date of that statement of financial position;
(b) 現時集團實體的每份利潤表及全面收益表內的收入及開支按平均匯率換算；及
(b) income and expenses for each statement of income and statement of comprehensive income of the Group entities are translated at average exchange rate; and
(c) 所產生的所有兌換差額乃於其他全面收益內確認及計算，並於權益項目下累積。
(c) all resulting exchange differences are recognised in other comprehensive income and accumulated as a separate component of equity.

收購境外主體產生的商譽及公允價值調整視為該境外主體的資產和負債，並按期末匯率換算。產生的匯兌差額在其他全面收益中入賬。

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. Exchange differences arising are recognised in other comprehensive income.

F-22

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-23 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.6 物業、廠房和設備

物業、廠房和設備按歷史成本減累計折舊及任何減值虧損入賬。資產的初始成本包括購入價及令該資產處於所擬運作狀況及地點之任何直接應佔成本。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.6 Property, plant and equipment

Property, plant and equipment are stated at historical cost less accumulated depreciation and any impairment losses. The initial cost of an asset comprises its purchase price and any directly attributable costs of bringing the asset to its working condition and location for its intended use.

當與項目有關的未來經濟利益可能流入本集團，而該項目的成本能夠可靠地計量時，則會將該項目其後產生的成本計入該項資產的賬面值內或確認為獨立資產（如適當）。其他所有維修及保養成本乃於其產生的會計期間內自合併利潤表扣除。

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are charged to the consolidated statement of income during the financial period in which they are incurred.

物業、廠房和設備的折舊按估計可使用年期以直綫法分配其成本減其殘值，有關年限如下：

Depreciation on property, plant and equipment is calculated using the straight-line method to allocate their costs less their residual values over their estimated useful lives, as follows:

－樓宇	35年
－汽車	5-10年
－傢俬、裝置及設備	5-10年
－租賃物業裝修	3-5年

– Buildings	35 years
– Motor vehicles	5-10 years
– Furniture, fittings and equipment	5-10 years
– Leasehold improvements	3-5 years

資產殘值及可使用年期均會於各報告期末時被檢討，並在適當情況下作出調整。

The assets’ residual value and useful life are reviewed, and adjusted if appropriate, at the end of each reporting period.

倘資產賬面值高於其估計可收回金額時，該項資產的賬面值將即時撇減至其可收回金額。

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

出售盈虧乃透過比較所得款項與賬面值而釐定，並作為「其他收益╱（虧損）-淨額」於合併利潤表中確認。

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are recognised as “Other gains/(losses) – net” in the consolidated statement of income.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-23

– F-24 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.7 投資物業

持作長期租金收入或資本增值或兩者兼備且並非本集團所佔用的物業分類為投資物業。投資物業也包括正在建造或開發供未來作投資物業使用之物業。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.7 Investment properties

Property that is held for long-term rental yields or for capital appreciation or both, and that is not occupied by the Group, is classified as investment property. Investment property also includes property that is being constructed or developed for future use as investment property.

投資物業包括根據經營租賃持有的土地及本集團擁有的樓宇。根據經營租賃持有的土地如能符合投資物業餘下的定義，則分類為投資物業並入賬。在此情況下，經營租賃視為融資租賃入賬。

Investment property comprises land held under operating leases and buildings owned by the Group. Land held under operating leases are classified and accounted for as investment property when the rest of the definition of investment property is met. In this case, the operating lease is accounted for as if it were a finance lease.

投資物業初始按其成本計量，包括相關的交易成本及相關的（如適用）借貸成本。於初始確認後，投資物業按公允價值列賬。公允價值變動於合併利潤表確認及單獨呈列。

Investment property is measured initially at its cost, including related transaction costs and where applicable borrowing costs. After initial recognition, investment property is carried at fair value. Changes in fair value are recognised and presented separately in the consolidated statement of income.

公允價值是根據活躍市價並經（如必要）就特定資產之性質、位置或狀況之任何差異作出調整而釐定。倘無法獲得該等資料，則本集團會使用可替代估值法，如較不活躍市場的近期價格或經折現現金流量預測。這些估值乃於各結算日由外部估值師實施。

Fair value is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods such as recent prices on less active markets or discounted cash flow projections. These valuations are performed at balance sheet date by external valuers.

F-24

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-25 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.7 投資物業（續）

倘公允價值能可靠計量，建設中物業按公允價值計量。倘無法可靠地釐定公允價值，則建設中投資物業於公允價值可以釐定或工程竣工前（以較早者為準）將以成本計量。此物業於該日的公允價值與當時賬面值之間的任何差額均在合併利潤表中確認。重新發展以持續作投資物業用途的投資物業，或市場活躍度降低的投資物業將繼續以公允價值計量。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.7 Investment properties (Cont’d)

Property under construction is measured at fair value if the fair value is considered to be reliably measurable. If the fair value cannot be reliably determined, the investment property under construction will be measured at cost until such time as fair value can be determined or construction is completed, whichever is earlier. Any difference between the fair value of the property at that date and its then carrying amount shall be recognised in the consolidated statement of income. Investment property that is being redeveloped for continuing use as investment property, or for which the market has become less active, continues to be measured at fair value.

其後支出只有在與該支出有關的未來經濟利益有可能流入本集團，而該項目的成本能可靠計量時，才撥入在資產的賬面值中。其他所有維修及保養成本於產生時支銷。

Subsequent expenditure is capitalised to the asset’s carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are expensed when incurred.

F-25

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-26 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.8 無形資產

商標

本集團商標乃按歷史成本法列賬的單獨購入商標。商標有特定使用年限並按成本減累計攤銷列賬。攤銷乃按直綫法將商標的成本分攤至10年的估計可使用年期計算。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.8 Intangible assets

Trademarks

Trademarks of the Group are separately acquired trademarks which are shown at historical cost. They have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of trademarks over their estimated useful lives of 10 years.

電腦軟件

本集團的電腦軟件包括按購入及使用該特定軟件所產生的成本作資本化處理的購入電腦軟件。這些成本按五年之估計可使用年期攤銷。

Computer software

Computer software of the Group comprises acquired computer software which is capitalised on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortised over their estimated useful lives of 5 years.

2.9 非金融資產的減值

沒有確定使用年限的資產或尚未可供使用的資產毋須攤銷，但會每年進行減值測試。當發生事件或情況變化顯示資產賬面值未必可收回時，會檢討該等須攤銷資產有否減值。減值虧損按資產賬面值超出其可收回金額的差額確認。可收回金額為資產公允價值減出售成本及使用價值的較高者。就評估減值而言，資產按獨立可識別現金流量的最低水平（現金產生單位）分類。非金融資產如出現減值，則會於各結算日期檢討可否撥回減值。

2.9 Impairment of non-financial assets

Assets that have an indefinite useful life or have not yet been available for use are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cashgenerating units). Non-financial assets that suffered an impairment are reviewed for possible reversal of the impairment at each balance sheet date.

F-26

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-27 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.10 完工待售或在建銷售物業

完工待售或在建銷售物業按成本及可變現淨值兩者的較低者列賬於流動資產。完工待售或在建銷售物業成本包括土地租賃成本、建造支出、資本化借款成本及於發展期間產生的其他直接成本。持有的物業成本按其未售出之物業成本按獲比例分配之該發展項目之全部發展成本計量。可變現淨值為管理層根據現行市況釐定之在通常業務過程中的估計銷售價，減預計至竣工需產生的其他成本及銷售時需產生的營銷成本。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.10 Properties held or under development for sale

Properties held or under development for sale are included in current assets at the lower of cost and net realisable value. The costs of properties held or under development consist of costs of leasehold land, construction expenditure, capitalised borrowing costs and other direct costs incurred during the development period. The costs of properties held are determined by apportionment of the total development costs for that development project attributable to the unsold properties. Net realisable value is based on estimated selling price in the ordinary course of business as determined by management with reference to the prevailing market conditions, less further costs expected to be incurred to completion and selling and marketing costs.

2.11 土地使用權

中國的所有土地均為國有且無單獨的土地所有權。本集團收購土地使用權從而進行物業開發。用於開發供出售的土地使用權作為存貨，並按成本值與可變現淨值兩者的較低者列賬，其中屬於正常營運週期內的土地使用權分類為流動資產並計入完工待售或在建銷售物業，而屬於正常營運週期以外的土地使用權分類為非流動資產。屬於投資物業的土地使用權分類為投資物業（附註2.7）。

2.11 Land use rights

All land in the PRC is stated-owned or collectivelyowned and no individual ownership right exists. Land use rights are acquired by the Group for development of properties. Land use rights held for development for sale are inventories and measured at lower of cost and net realisable value, of which those within normal operating cycle are classified as current assets and included in properties held or under development for sale, while those out of the normal operating cycle are classified as non-current assets. Land use rights fall within investment properties are classified as investment properties (Note 2.7).

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-27

– F-28 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產

2.12.1 分類

本集團將金融資產分為以下類別︰貸款及應收款項以及可供出售金融資產。分類視乎收購金融資產之目的而定。管理層於初始確認金融資產時決定其分類。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets

2.12.1 classification

The Group classifies its financial assets in the following categories: loans and receivables, and available for sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

(i) 貸款及應收款項

貸款及應收款項為有固定或可釐定付款的非衍生金融資產，且在活躍市場並無報價。該等金融資產計入流動資產，惟到期日超過於報告期末起計12個月的項目則被分類為非流動資產。本集團貸款及應收款項於資產負債表內包括「貿易和其他應收款項及預付款項」的若干項目及計入「現金和現金等價物」和「受限制現金」的銀行存款（附註15及附註 17）。

(i) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than 12 months after the end of reporting period, which are classified as non-current assets. The Group’s loans and receivables comprise certain items in “Trade and other receivables and prepayments” and bank deposits included in “cash and cash equivalents” and “restricted cash” in the statement of financial position (Note 15 and Note 17).

(ii) Available-for-sale financial assets

(ii) 可供出售金融資產

可供出售金融資產屬於指定列入該類或不可歸入任何其他類別的非衍生工具。除非管理層有意於報告期末起計12個月內處置該投資，否則該等項目入賬列為非流動資產。

Available-for-sale financial assets are nonderivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the end of the reporting period.

F-28

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-29 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產（續）

2.12.2 確認及計量

正常買賣金融資產在交易日（本集團承諾買賣該資產的日期）確認。對於以公允價值計量但其變動並非計入損益的所有金融資產，投資初始按公允價值加交易成本確認。當從投資收取現金流量的權利已屆滿或已轉讓，且本集團已實質上將擁有權的所有風險和回報轉讓時，即中止確認金融資產。可供出售金融資產其後按公允價值列賬。貸款及應收款項隨後使用實際利率法按已攤銷成本列賬。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets (Cont’d)

2.12.2 Recognition and measurement

Regular purchases and sales of financial assets are recognised on the trade-date – the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets are subsequently carried at fair value. Loans and receivables are subsequently carried at amortised cost using the effective interest method.

分類為可供出售的貨幣性及非貨幣性證券的公允價值變動在其他全面收益內確認。

Changes in the fair value of monetary and nonmonetary securities classified as available for sale are recognised in other comprehensive income.

當分類為可供出售的證券售出或減值時，在權益中確認的累計公允價值調整列入合併利潤表內。

When securities classified as available for sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the consolidated statement of income.

可供出售證券的利息按實際利率法於合併利潤表內確認為部分其他收入。可供出售股權工具的股息於本集團確立收取股息之權利時於合併利潤表中確認為部分其他收入。

Interest on available-for-sale securities calculated using the effective interest method is recognised in the consolidated statement of income as part of other income. Dividends on available-for-sale equity instruments are recognised in the consolidated statement of income as part of other income when the Group’s right to receive payments is established.

F-29

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-30 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產（續）

2.12.3 金融資產減值

(i) 按攤銷成本列賬的資產

本集團於各報告期末評估有否客觀證據顯示一項或一組金融資產出現減值。僅於有客觀證據顯示資產初始確認後發生的一項或多項事件引致減值（「虧損事件」）且虧損事件對一項或一組金融資產能可靠預計的估計未來現金流量有影響，則表示該項或該組資產已減值，並應計減值虧損。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets (Cont’d)

2.12.3 Impairment of financial assets

(i) Assets carried at amortised cost

The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.

減值虧損的證據可包括債務人或一組債務人遇上嚴重財政困難、逾期或拖欠償還利息或本金、債務人很有可能破產或進行其他財務重組，以及有可觀察數據顯示估計未來現金流有可計量的減少，例如與違約有相互關連的拖欠情況或經濟狀況改變。

Evidence of impairment may include indications that the debtors or a group of debtors are experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation, and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

F-30

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-31 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產（續）

2.12.3 金融資產減值（續）

(i) 按攤銷成本列賬的資產（續）

對於貸款及應收款類別，損失金額乃根據資產賬面值與按金融資產原實際利率貼現而估計未來現金流量（不包括仍未產生的未來信用損失）的現值兩者的差額計量。資產賬面值予以削減，而損失金額則在合併利潤表確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets (Cont’d)

2.12.3 Impairment of financial assets (Cont’d)

(i) Assets carried at amortised cost (Cont’d)

For loans and receivables category, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the consolidated statement of income.

如在後繼期間，減值虧損的數額減少，而此減少可客觀地聯繫至減值在確認後才發生的事件（例如債務人的信用評級有所改善），則之前已確認的減值虧損可在合併利潤表轉回。

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in the consolidated statement of income.

F-31

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-32 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產（續）

2.12.3 金融資產減值（續）

(ii) 分類為可供出售資產

本集團於各呈報期末評估有否客觀證據顯示一項或一組金融資產出現減值。對於債務證券，本集團使用上文(i)所述標準評估。倘為可供出售的權益投資，證券公允價值顯著下跌或長期低於成本亦是資產減值的證據。倘可供出售金融資產顯示該等證據，累計虧損（即收購成本與當前公允價值減金融資產先前於損益確認之減值虧損的差額）自權益轉撥至損益確認。於合併利潤表確認的權益工具減值虧損不會通過合併利潤表撥回。倘可供出售的權益工具公允價值於其後期間增加且增加與減值虧損於損益確認後發生的事件有客觀聯繫，則減值虧損通過合併利潤表撥回。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets (Cont’d)

2.12.3 Impairment of financial assets (Cont’d)

(ii) Assets classified as available for sale

The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. For debt securities, the Group uses the criteria referred to in (i) above. In the case of equity investments classified as available for sale, a significant or prolonged decline in the fair value of the security below its cost is also evidence that the assets are impaired. If any such evidence exists for available-forsale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity and recognised in profit or loss. Impairment losses recognised in the consolidated statement of income on equity instruments are not reversed through the consolidated statement of income. If, in a subsequent period, the fair value of a debt instrument classified as available for sale increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed through the consolidated statement of income.

F-32

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-33 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.12 金融資產（續）

2.12.4 終止確認金融資產

金融資產（或倘適用，一項金融資產的一部分或一組相若金融資產的一部分）在下列情況下將予終止確認：

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.12 Financial assets (Cont’d)

2.12.4 Derecognition of financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:

自該項資產收取現金流量的權利已屆滿；
the rights to receive cash flows from the asset have expired;
本集團轉讓自該項資產收取現金流量的權利，或已根據一項「轉付」安排，承擔將所得現金流量全數付予第三方的責任，且不會嚴重延緩；或
the Group has transferred its rights to receive cash flows from the asset, or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a “pass-through” arrangement; or
本集團轉讓自該項資產收取現金流量的權利及(a)本集團已實質上轉讓該項資產的所有風險及回報；或(b)本集團並無實質上轉讓或保留該項資產的所有風險及回報，但已轉讓對該項資產的控制權。
the Group has transferred its rights to receive cash flows from the asset and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

倘本集團已轉讓其收取該項資產所產生現金流量的權利或已訂立轉付安排，但並無實質上轉讓或保留該項資產的所有風險及回報，亦無轉讓對該項資產的控制權，則該資產將視本集團繼續參與該資產的程度而確認入賬。在此情況下，本集團亦確認聯屬責任。已轉讓資產及聯屬責任以反映本集團所保留的權利及責任為基準計量。

When the Group has transferred its rights to receive cash flows from an asset or has entered into a passthrough arrangement, and has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognised to the extent of the Group’s continuing involvement in the asset. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained.

以擔保已轉讓資產的方式繼續參與，乃按該資產的原賬面值及本集團可能被要求償還的代價最高金額（以較低者為準）計量。

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-33

– F-34 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.13 抵銷金融工具

當有法定可執行權利可抵銷已確認金額，並有意按淨額基準結算或同時變現資產和結算負債時，金融資產與負債可互相抵銷，並在資產負債表呈報其淨額。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

2.14 貿易和其他應收款項

貿易和其他應收款項初始以公允價值確認，其後利用實際利率法按攤銷成本扣除減值撥備計量。當有客觀證據證明本集團將無法按應收款項之原有條款收回所有款項時，即就貿易和其他應收款項設定減值撥備。債務人的重大財務困難、債務人可能會破產或進行財務重組以及違約或拖欠款項被認為是應收款項減值的跡象。撥備金額為資產之賬面值與按原有實際利率折現之估計未來現金流量之現值之差額。資產之賬面值透過使用撥備賬戶削減，而有關虧損金額則在合併利潤表內確認。

2.14 Trade and other receivables

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade and other receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the receivable is impaired. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the assets is reduced through the use of an allowance account and the amount of the loss is recognised in the consolidated statement of income.

倘貿易和其他應收款項無法收回，其會就貿易和其他應收款項之撥備賬戶撇銷。其後收回先前撇銷的金額將貸記入合併利潤表內。

When a trade or other receivable is uncollectible, it is written off against the allowance account for trade and other receivables. Subsequent recoveries of amounts previously written off are credited to the consolidated statement of income.

貿易和其他應收款項計入流動資產，惟於報告期起計超過12個月者（或倘於正常業營運週期外，則可較長），則分類為非流動資產。

Trade and other receivables are included in current assets, except for those maturing more than twelve months after the reporting period (or out of the normal operating cycle of the business if longer) which are classified as non-current assets.

F-34

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-35 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.15 現金和現金等價物

現金和現金等價物包括手頭現金、銀行通知存款及原定到期日為三個月或以內之高流動性其他短期投資。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.15 cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less.

2.16 股本

普通股分類為權益。直接歸屬於發行新股或期權的新增成本在權益中列為所得款項之減項（扣除稅項）。

2.16 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

2.17 貿易和其他應付款項

貿易和其他應付款項乃就日常業務過程中購買供應商提供的產品或服務而應支付的義務。倘貿易及其他應付款項的支付日期在報告期起計12個月內（如仍在正常營運週期中，則可較長），其被分類為流動負債。否則，分類為非流動負債。

2.17 Trade and other payables

Trade and other payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade and other payables are classified as current liabilities if payment is due within twelve months after the reporting period (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

貿易和其他應付款項初始以公允價值確認，其後利用實際利率法按攤銷成本計量。

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

F-35

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-36 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.18 借款及借貸成本

借款初始按公允價值扣除所產生的交易成本予以確認。借款其後按攤銷成本列賬；所得款項（扣除交易成本）與贖回價值間的任何差額使用實際利率法於借款期間在合併利潤表內確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.18 Borrowings and borrowing costs

Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the consolidated statement of income over the period of the borrowings using the effective interest method.

在貸款很有可能部分或全部提取的情況下，就設立貸款融資支付的費用乃確認為貸款交易成本。在此情況下，該費用將遞延至提取貸款發生時。在並無跡象顯示該貸款很有可能部分或全部提取的情況下，該費用撥充資本作為流動資金服務的預付款項，並於其相關融資期間內予以攤銷。

Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

除非本集團有權無條件將債務結算日期遞延至報告期後至少12個月，否則借款將被劃分為流動負債。

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

直接歸屬於收購、建設或生產合資格資產（即需要經過相當長時間才能達到預定用途或銷售狀態的資產）的一般及特定借款成本，計入該等資產的成本，直至該等資產基本達到預定用途或銷售狀態。就特定借款，因有待合資格資產的支出而臨時投資賺取的投資收入，應自合資格資本化的借款成本中扣除。其他借款成本於其產生期間支銷。

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. Other borrowing costs are expensed in the period when they are incurred.

F-36

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-37 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.19 即期及遞延所得稅

期間的稅項開支包括即期稅項及遞延稅項。稅項乃於合併利潤表內確認，惟與於其他全面收益或直接於權益確認的項目有關的稅項除外。在此情況下，稅項亦分別於其他全面收益或直接於權益內確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.19 current and deferred income tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the consolidated statement of income, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.

即期所得稅支出根據本公司及其子公司營運及產生應課稅收入的國家於報告期末已頒佈或實質上已頒佈的稅務法例計算。管理層就適用稅務法例受詮釋所規限的情況定期評估報稅表的狀況，並在適用情況下根據預期須向稅務機關繳納的稅款設定撥備。

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluate positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

對於資產及負債的稅基與其在合併財務報表的賬面值的暫時性差額，使用負債法確認遲延所得稅。然而，倘遞延所得稅乃因首次確認交易（並非業務合併）中的資產或負債而產生，且進行有關交易時並無影響會計或應課稅利潤或虧損，則不予入賬。遞延所得稅乃按結算日前已頒佈或實質上已頒佈，並預期將於相關遞延所得稅資產變現或遞延所得稅負債清償時應用的稅率（及法律）計算。

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

F-37

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-38 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.19 即期及遞延所得稅（續）

遞延所得稅資產是就可能有未來應課稅利潤而就此可使用暫時性差額而確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.19 current and deferred income tax (Cont’d)

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

遞延所得稅乃就於子公司及聯營公司的投資產生的暫時差額而撥備，惟倘本集團可控制暫時差額的撥回時間，且暫時差額有可能在可預見將來不會獲撥回則除外。

Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

倘有可依法強制執行權利將即期稅項資產與即期稅項負債抵銷，且遞延所得稅資產及負債與同一稅務機關就一個或多個應課稅實體徵收之所得稅有關，而有關實體有意按淨額基準結算結余時，遞延所得稅資產與負債將予互相抵銷。

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income taxes assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

2.20 員工福利

根據中國內地規則及法規，本集團的中國內地員工須參加中國內地有關省市政府管理的多項界定供款退休福利計劃，據此，本集團及中國內地員工須每月按員工薪金的特定百分比向該等計劃供款，惟無需超過若干上限。

2.20 Employee benefits

In accordance with the rules and regulations of mainland China, the mainland China based employees of the Group participate in various defined contribution retirement benefit plans organised by the relevant municipal and provincial governments in the mainland China under which the Group and the mainland China based employees are required to make monthly contributions to these plans calculated as a percentage of the employees’ salaries, subject to a certain ceiling.

F-38

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-39 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.20 員工福利（續）

省市政府承諾承擔根據上述計劃應付的全部現有及未來中國內地員工退休福利責任。除每月供款外，本集團毋須就其員工承擔其他退休金付款或其他退休後福利的責任。這些計劃的資產與本集團其他資產分開持有，並由市級和省級政府獨立管理的基金保管。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.20 Employee benefits (Cont’d)

The municipal and provincial governments undertake to assume the retirement benefit obligations of all existing and future retired mainland China based employees payable under the plans described above. Other than the monthly contributions, the Group has no further obligation for the payment of retirement and other postretirement benefits of its employees. The assets of these plans are held separately from those of the Group in independently administrated funds managed by the municipal and provincial governments.

2.21 以股份為基礎的支付

本集團實行數項以權益償付首次公開發售前股份獎勵計劃，在該等計劃下，本集團獲取僱員及若干前僱員、高級僱員及業務合夥人提供的服務作為本公司股本工具（獎勵）的對價。現任僱員及若干前僱員、高級僱員及業務合夥人為獲取股份而提供的服務的公允價值確認為費用。該等予以支銷的總金額乃經參考獲授予股份的公允價值釐定：

2.21 Share-based payments

The Group operates an equity-settled pre-IPO share award scheme, under which the Group receives services from employees and certain former employees, officers and business partners as consideration for equity instruments (awards) of the Company. The fair value of the current employee and certain former employees, officers and business partners services received in exchange for the grant of the shares is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the shares granted:

包括任何市場業績條件；
i n c l u d i n g a n y m a r k e t p e r f o r m a n c e conditions;
不包括任何服務及非市場業績可行權條件的影響；及
excluding the impact of any service and non-market performance vesting conditions; and
包括任何非可行權條件的影響。
including the impact of any non-vesting conditions.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-39

– F-40 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.21 以股份為基礎的支付（續）

非市場績效歸屬條件包括在有關預期歸屬的股份數目的假設中。列作開支的總金額乃在歸屬期確認，歸屬期即符合所有特定歸屬情況的期間。於各報告期末，本集團會根據非市場績效歸屬條件修改其估計預期將歸屬的股份數目，並於合併利潤表內確認修改原來估計數字（如有）的影響，以及須對權益作出的相應調整。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.21 Share-based payments (Cont’d)

Non-market performance vesting conditions are included in assumptions about the number of shares that are expected to vest. The total expense is recognised over the vesting period, which is the period over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the Group revises its estimates of the number of shares that are expected to vest based on the non-market performance vesting conditions. It recognises the impact of the revision to original estimates, if any, in the consolidated statement of income, with a corresponding adjustment to equity.

本公司向本集團子公司的僱員授予其股份，被視為資本投入。所獲得僱員服務的公允價值乃參考授出日期的公允價值計量，於歸屬期內確認為增加對子公司的投資，並相應計入本公司的權益賬。

The grant by the Company of its shares to the employees of subsidiaries in the Group is treated as a capital contribution. The fair value of employee services received, measured by reference to the grant date fair value, is recognised over the vesting period as an increase to investments in subsidiaries, with a corresponding credit to equity account of the Company.

2.22 撥備及或有負債

倘本集團因過往事件而現時須承擔法定或推定責任，且履行該等責任可能須動用資源，及所涉及的金額能可靠估計時，則確認撥備。未來營運虧損毋須確認撥備。

2.22 Provisions and contingent liabilities

Provisions are recognised when: the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses.

倘存在多項相若責任時，履行該等責任是否需要動用資源在考慮整體責任之類別後釐定。即使同一類別之任何一項責任可能須動用資源的可能性極低，亦須確認撥備。

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

F-40

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-41 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.22 撥備及或有負債（續）

撥備採用反映當時市場對金錢時間值和有關責任固有風險之評估的稅前比率按照預期需履行有關責任之開支之現值計量。隨著時間消逝而增加的撥備確認為利息開支。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.22 Provisions and contingent liabilities (Cont’d)

Provisions are measured at the present value of the expenditure expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense.

或有負債乃一項因過往事件可能產生的責任，而該責任的存在僅可由一項或多項並非由本集團全權控制之日後不明朗事件之存在與否確定。或然負債亦可為因不大可能需要動用經濟資源或承擔之金額未能可靠地估量而未確認之過往事件產生之現有承擔。

A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmed by the occurrence or nonoccurrence of one or more uncertain future events not wholly within the control of the Group. It can also be a present obligation arising from past events that is not recognised because it is not probable that outflow of economic resources will be required or the amount of obligation cannot be measured reliably.

或有負債不予確認，但會於合併財務報表附註中披露。倘支付之可能性出現變動致使有可能需支付，則或然負債將確認為撥備。

A contingent liability is not recognised but is disclosed in the notes to the consolidated financial statements. When a change in the probability of an outflow occurs so that outflow is probable, it will then be recognised as a provision.

F-41

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-42 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.23 收入確認

收入包括本集團在日常業務過程中出售物業及服務之已收或應收代價之公允價值。收入在扣除退貨、回扣及折扣及經撇銷本集團公司間銷售後予以呈列。收入確認如下：

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.23 Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of properties and services in the ordinary course of the Group’s activities. Revenue is shown net of returns, rebates and discounts and after eliminated sales within the Group. Revenue is recognised as follows:

(i) 出售物業

出售物業的收入於物業的風險及回報已轉讓予買方（即有關物業已竣工時）並根據銷售協議將物業交付買家，且能合理確保收回有關應收款項時，方予以確認。收入確認日期前就已售物業收取的按金及分期付款於合併資產負債表內的流動負債下記錄為「預售物業預收款項」。

(i) Sales of properties

Revenue from sales of properties is recognised when the risks and rewards of the properties are transferred to the purchasers, which is when the construction of relevant properties has been completed and the properties have been delivered to the purchasers pursuant to the sales agreement and collectibility of related receivables is reasonably assured. Deposits and instalments received on properties sold prior to the date of revenue recognition are recorded as “Advances from pre-sale of properties” in the consolidated statement of financial position under current liabilities.

(ii) 租金收入

來自經營租賃所出租物業的租金收入，以直綫法在租賃期內確認。

(ii) Rental income

Rental income from properties being let under operating leases is recognised on a straight line basis over the lease terms.

(iii) 服務收入

服務收入於相關的提供服務已提供，並能夠可靠地估計收入及成本總額，且能合理確保收回有關應收款項時確認。

(iii) Service income

Revenue from services is recognised when services have been provided, total amount of revenue and costs can be estimated reliably and the collectibility of the related receivables is reasonably assured.

F-42

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-43 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.23 收入確認（續）

(iv) 利息收入

利息收入利用實際利率法按時間比例確認。當應收款項出現減值時，本集團將其賬面值減至其可收回金額（即按工具的原實際利率貼現的估計未來現金流量），並繼續沖抵折現作為利息收入。減值貸款和應收款項的利息收入利用原實際利率確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.23 Revenue recognition (Cont’d)

(iv) Interest income

Interest income is recognised on a timeproportion basis using the effective interest method. When a receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flows discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans and receivables is recognised using the original effective interest rate.

(v) 股息收入

股息收入在收取股息之權利獲確定時確認。

(v) Dividend income

Dividend income is recognised when the right to receive payment is established.

2.24 政府補貼

倘可合理地保證本集團將會收到補貼及本集團將符合所有附帶條件，則政府補貼按公允價值確認。與成本有關的政府補貼將會遞延，並於擬補償之成本所需進行配對的期間內於合併利潤表內確認。作為開支或已產生的虧損的補償金或向本集團旗下企業提供即時財務援助而成為應收款項（並無日後相關成本）的政府補貼，乃於其成為應收款項的期間確認為收入。

2.24 Government grants

Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions. Government grants relating to costs are deferred and recognised in the consolidated statement of income over the period necessary to match them with the costs they are intended to compensate. Government grants that become receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to an entity within the Group with no future related costs are recognised as income of the period in which they become receivable.

F-43

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-44 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.25 財務擔保負債

本集團就銀行按揭信貸為若干購房者提供財務擔保。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.25 Financial guarantee liabilities

The Group provides financial guarantees for certain property purchasers on mortgage facilities with banks.

財務擔保負債初步按公允價值加作出相關財務擔保負債直接產生的交易成本確認。於首次確認後，有關合約按履行現有責任所需開支的最佳估計現值與首次確認金額減累計攤銷的較高者計量。

Financial guarantee liabilities are recognised initially at fair value plus transaction costs that are directly attributable to the issue of the financial guarantee liabilities. After initial recognition, such contracts are measured at the higher of the present value of the best estimate of the expenditure required to settle the present obligation and the amount initially recognised less cumulative amortisation.

財務擔保負債當且僅當合約列明的責任已解除或註銷或屆滿時方於資產負債表中終止確認。

Financial guarantee liabilities are derecognised from the statement of financial position when, and only when, the obligation specified in the contract is discharged or cancelled or expired.

2.26 經營租賃

出租人保留所有權的絕大部分風險及回報的租賃均列為經營租賃。根據經營租賃支付的款項（扣除自出租人收取之任何獎勵金後），於租賃期內以直綫法自合併利潤表扣除。

2.26 Operating leases

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the consolidated statement of income on a straight-line basis over the period of the lease.

2.27 股息分派

向本公司股東分派的股息於股息獲本公司股東正式批准的期間在本集團及本公司財務報表中確認，並在適用時作為負債入賬。

2.27 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised, as a liability where applicable, in the Group’s and the Company’s financial statements in the period in which the dividends are properly approved by the Company’s shareholders.

F-44

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-45 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

2 重大會計政策概要（續）

2.28 結算日後事項

提供本集團於報告期末狀況的其他資料的報告期後事項（「調整事項」）於合併財務報表中反映。並非調整事項的報告期後事項如涉及金額重大則在附註中披露。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.28 Subsequent events

Events after the reporting period that provide additional information about the Group’s position at the end of the reporting period (“adjusting events”) are reflected in the consolidated financial statements. Events after the reporting period that are not adjusting events are disclosed in the notes when material.

3 財務風險管理

本集團的業務承受多項財務風險：市場風險（包括外匯風險、價格風險、現金流量及公允價值利率風險）、信貸風險及流動資金風險。本集團的整體風險管理計劃專注於金融市場的不可預測性，並尋求方法盡量降低對本集團財務業績可能構成的不利影響。

3 FINANCIAL RISK MANAGEMENT

The Group’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk, price risk, cash flow and fair value interest rate risk), credit risk, and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.

3.1 市場風險

(i) 外匯風險

本集團僅於中國從事房地產的開發、銷售及管理，幾乎所有交易均以人民幣計值。此外，本集團大部份資產及負債均以人民幣計值。因此，本集團並無承擔重大外匯風險，惟本公司首次公開發售所得的銀行存款除外，其以港元計值。

3.1 Market risk

(i) Foreign exchange risk

The Group is engaged in the development, sale and management of properties solely in the PRC with almost all transactions denominated in RMB. In addition, the majority of the Group’s assets and liabilities are denominated in RMB. Accordingly, the Group is not exposed to significant foreign currency risk, except for the bank deposits from the Company’s initial public offering, which are denominated in HKD.

由於管理層預計可迅速兌換港元存款為人民幣，故此並無作出對沖安排。

N o h e d g i n g h a s b e e n a r r a n g e d a s management is expecting converting the HKD deposits into RMB fairly quickly.

於2012年12月31日，若港元兌人民幣貶值╱ 升值5%，所有其他變數固定，本集團年內除稅後溢利將減少╱增加人民幣12,052,000元（2011年：人民幣174,000元），主要原因是以港元計值的銀行存款產生的外匯虧損╱收益。

As at 31 December 2012, if HKD had weakened/strengthened by 5% against RMB, all other variables held constant, post-tax profit of the Group for the year would have been RMB12,052,000 (2011: RMB174,000) lower/higher, mainly as a result of foreign exchange loss/gain from the bank deposits denominated in HKD.

F-45

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-46 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

3.1 Market risk (Cont’d)

3.1 市場風險（續）

(ii) 價格風險

由於本集團所持投資在合併資產負債表內被分類為可供出售金融資產，故本集團承受價格風險。

(ii) Price risk

The Group is exposed to price risk because of investments held by the Group and classified on the consolidated statements of financial position as available-for-sale financial assets.

董事認為，本集團就其投資所承受的價格風險並不重大，概因本集團訂有政策，不會作出對本集團財務業績可能造成不利影響的重大投資。所有投資須經董事長批准後方可進行。

In the opinion of the directors, the Group’s exposure to price risk with regard to its investments is not significant since it is the Group’s policy not to invest significant amounts that might have a detrimental impact to the Group’s financial results. All investments must be approved by the Chairman of the Board before they may be entered into.

下表概述分類為可供出售股本證券的公允價值上升╱下跌5%，該證券收益╱虧損對本集團其他全面收益增加╱減少的影響。

The following table summarises the Group’s other comprehensive income increase/ decrease as a result of gains/losses on equity securities classified as available for sale if the fair value of the securities increase/ decrease by 5%.

截至12月31日止年度 Year ended 31 December

					2012年	2011年
					2012	2011
					人民幣千元	人民幣千元
					RMB’000	RMB’000
－上調5%	–	5	percent	higher	6,795	5,850
－下調5%	–	5	percent	lower	(6,795)	(5,850)

F-46

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-47 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3.1 市場風險（續）

(iii) 現金流量和公允價值利率風險

除銀行現金存款外，本集團並無其他重大計息資產。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.1 Market risk (Cont’d)

(iii) Cash flow and fair value interest rate risk

Except for cash deposits in the bank, the Group has no other significant interestbearing assets.

本集團承受的利率變動風險主要來自銀行及非銀行金融機構借款。浮息借款使本集團承受現金流量利率風險，而固息借款則令本集團承受公允價值利率風險。本集團並無對沖其現金流量或公允價值利率風險。利率及償還借款的條款於附註21披露。

The Group’s exposure to changes in interest rates is mainly attributable to its borrowings from bank and non-bank financial institutions. Borrowings at variable rates expose the Group to cash flow interest rate risk. Borrowings at fixed rates expose the Group to fair value interest rate risk. The Group has not hedged its cash flow or fair value interest rate risk. The interest rate and terms of repayments of borrowings are disclosed in Note 21.

由於預期銀行存款的利率不會出現大幅波動，管理層預期利率變動不會對計息資產產生重大影響。

Management does not anticipate significant impact to interest-bearing assets resulted from the changes in interest rates, because the interest rates of bank deposits are not expected to change significantly.

F-47

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-48 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

(Cont’d)

3.1 市場風險（續）

(iii) 現金流量和公允價值利率風險（續）

於2012年和2011年12月31日，倘浮息借款利率上調╱下調50個基點，而所有其他變量保持不變，則本集團截至2012年和2011年12月 31日止年度的除稅後利潤和資本化利息變動如下：

3.1 Market risk (Cont’d)

(iii) Cash flow and fair value interest rate risk (Cont’d)

As at 31 December 2012 and 2011, if interest rates on borrowings at floating rates had been 50 basis points higher/lower with all other variables held constant, the posttax profit and capitalised interest of the Group for the years ended 31 December 2012 and 2011 would have changed as follows:

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
除稅後利潤增加╱（減少）	Post-tax profit increase/(decrease)
－上調50個基點	– 50 basis points higher	(4,814) (488)
－下調50個基點	– 50 basis points lower	4,814 488
資本化利息增加╱（減少）	Capitalised interest increase/(decrease)
－上調50個基點	– 50 basis points higher	26,246 29,427
－下調50個基點	– 50 basis points lower	(26,246) (29,427)

F-48

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-49 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

(Cont’d)

3.2 信貸風險

本集團並無重大集中信貸風險。合併資產負債表中列示的銀行存款和貿易和其他應收款項賬面值指本集團就其金融資產承受的最大信貸風險。

3.2 credit risk

The Group has no significant concentrations of credit risk. The carrying amounts of bank deposits and trade and other receivables included in the consolidated statement of financial position represent the Group’s maximum exposure to credit risk in relation to its financial assets.

現金交易限於信貸質量較高的金融機構。下表載列於 2012年和2011年12月31日的銀行存款結餘：

Cash transactions are limited to high-credit-quality financial institutions. The table below shows the bank deposit balances as at 31 December 2012 and 2011:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
交易對手	counter party	RMB’000		RMB’000
於中國四大國有銀行的存款	Deposits in the four major state-owned banks
	of the PRC	3,761,048		3,482,973
於中國其他上市銀行的存款	Deposits in other listed banks of the PRC	1,327,230		778,222
於其他銀行的存款	Deposits in other banks	899,831		261,002
		5,988,109		4,522,197

管理層預期不會因該等交易對手的不履約行為而產生任何虧損。

Management does not expect any losses from nonperformance of these counterparties.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-49

– F-50 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

(Cont’d)

3.2 信貸風險（續）

本集團採取政策以確保物業銷售予財務狀況相對良好及能支付適當比例首期付款的買家。同時，倘買家拖欠付款，本集團有權取消銷售合同，並將相關物業投入市場重新銷售。因此，銷售物業產生的信貸風險有限。

3.2 credit risk (Cont’d)

The Group has policies in place to ensure that sales of properties are made to buyers with an appropriate financial strength and appropriate percentage of down payment. Meanwhile, the Group has the right to cancel the sales contract in the event that the buyers default in payment, and put the underlying properties back to the market for re-sale. Therefore, the credit risk from sales of properties is limited.

其他應付款項主要包括於日常業務過程中應收關連方款項和按金。本集團密切監控這些其他應收款項以確保在面臨違約的風險時採取行動收回結餘。

Other receivables mainly comprise receivables from related parties and deposits made in the ordinary course of business. The Group closely monitors these other receivables to ensure actions are taken to recover these balances in the case of any risk of default.

3.3 流動資金風險

本集團管理層旨在從內部銷售所得款項及充足的承諾信貸融資維持足夠現金以滿足其物業項目的營運需求和承諾。

3.3 Liquidity risk

Management of the Group aims to maintain sufficient cash through internally generated sales proceeds and an adequate amount of committed credit facilities to meet its operation needs and commitments in respect of property projects.

F-50

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-51 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3.3 流動資金風險（續）

下表乃根據於2012年及2011年12月31日至合同到期日的剩餘期間，按相關到期組別分析本集團金融負債。表內披露的金額為合同未貼現現金流量。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.3 Liquidity risk (Cont’d)

The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period as at 31 December 2012 and 2011 to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

		一年以內	一至二年	二至五年	五年以上	合計
			Between	Between
		Within	1 and	2 and	Over
		1 year	2 years	5 years	5 years	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
於2012年12月31日	As at 31 December 2012
借款本金（附註21）	Borrowings, principal (Note 21)	5,130,436	2,700,670	1,359,000	450,000	9,640,106
支付借款利息	Interest payments on borrowings	586,905	261,389	201,499	67,328	1,117,121
貿易和其他應付款項	Trade and other payables
（不包括應付稅項）	(excluding taxes payable)	9,388,569	–	–	–	9,388,569
應付股息	Dividends payable	805	–	–	–	805
有關購買本集團物業	Guarantees in respect of mortgaged
而獲授按揭額度的	facilities granted to purchasers of
擔保（附註36）	the Group’s properties (Note 36)	3,261,710	731,975	–	–	3,993,685
		18,368,425	3,694,034	1,560,499	517,328	24,140,286
於2011年12月31日	As at 31 December 2011
借款本金（附註21）	Borrowings, principal (Note 21)	4,253,200	3,671,200	2,978,000	–	10,902,400
支付借款利息	Interest payments on borrowings	892,543	595,939	164,102	–	1,652,584
貿易和其他應付款項	Trade and other payables
（不包括應付稅項）	(excluding taxes payable)	6,426,631	–	–	–	6,426,631
應付股息	Dividends payable	805	–	–	–	805
有關購買本集團物業	Guarantees in respect of mortgaged
而獲授按揭額度的	facilities granted to purchasers of
擔保（附註36）	the Group’s properties (Note 36)	3,661,850	308,901	–	–	3,970,751
		15,235,029	4,576,040	3,142,102	–	22,953,171

附註：借款利息沒有考慮到未來借貸，並且根據2012年和2011年12月31 日所持借款計算。浮動利息分別使用2012年和2011年12月31日的當時利率估算。

Note: The interest on borrowings is calculated based on borrowings held as at 31 December 2012 and 2011 without taking into account future borrowings. Floatingrate interests are estimated using the current interest rate as at 31 December 2012 and 2011, respectively.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-51

– F-52 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

(Cont’d)

3.3 流動資金風險（續）

鑒於相關業務的動態性質，本集團的管理層會密切監控流動資金的風險並採取以下措施管理流動資金風險：

3.3 Liquidity risk (Cont’d)

Due to dynamic nature of the underlying business, the management of the Group is closely monitoring the risk of the liquidity and takes the following actions to manage the liquidity risk:

i) 編製年度現金流量預測並按月更新該預測以反映最新變化及密切監控流動資金風險；
i) prepares annual cash flow forecast and updates such forecast on a monthly basis to reflect the latest changes and monitor the liquidity risk closely;
ii) 與主要銀行和其他金融機構保持戰略合作關係以在適當時取得信貸額度；
ii) maintains strategic cooperation with major banks and other financial institutions to secure credit facilities where appropriate;
iii) 繼續取得長期融資信貸、附有抵押本集團在建物業的主要項目銀行貸款或本集團視為適當的其他資金來源；
iii) continues to obtain longer term financing facilities, mainly project bank loans with pledge of the Group’s properties under development, or other resources of funding which the Group considers appropriate;
iv) 積極推動銷售本集團竣工物業及預售在建物業。本集團亦會考慮靈活調整價格和銷量以管理流動資金風險。
iv) proactively promotes the sales of the Group’s completed properties and pre-sales of properties under development. The Group also considers the flexibility of adjusting the price and volume on sale of properties for management of liquidity risk.

3.4 資本風險管理

本集團的資本管理的目標乃為保障本集團能繼續營運，以為股東提供回報和維持最佳的資本結構以降低資金成本。

3.4 capital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital.

為維持或調整資本結構，本集團可能會調整支付予股東的股息金額、發行新股或出售資產以減少債務。

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt.

F-52 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-53 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT

(Cont’d)

3.4 資本風險管理（續）

本集團利用資產負債比率監察其資本。此比率按照債務淨額除以資本總額計算。債務淨額為借款總額減去現金和現金等價物。資本總額按合併資產負債表所列示的權益總額加上債務淨額計算。

3.4 capital risk management (Cont’d)

The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings less cash and cash equivalents. Total capital is calculated as total equity, as shown in the consolidated statement of financial position, plus net debt.

於2012年和2011年12月31日，本集團資產負債比率如下：

The gearing ratios of the Group at 31 December 2012 and 2011 were as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年	2011年
		2012	2011
		人民幣千元	人民幣千元
		RMB’000	RMB’000
借款總額	Total borrowings	9,640,106	10,866,563
減：現金和現金等價物	Less: Cash and cash equivalents	(4,852,130)	(4,221,558)
債務淨額	Net debt	4,787,976	6,645,005
權益總額	Total equity	8,395,027	5,201,949
資本總額	Total capital	13,183,003	11,846,954
資產負債比率	Gearing ratio	36%	56%

資產負債比率於2012年12月31日降低，主要原因是年內發行普通股（附註18）及償還借款。

The decrease in the gearing ratio as at 31 December 2012 resulted primarily from issuance of ordinary shares (Note 18) and repayment of borrowings during the year.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-53

– F-54 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

4 公允價值估計

本集團就於合併財務報表中按公允價值計量的金融工具採納香港財務報告準則第7號，此項修訂要求採用下列公允價值計量層級對公允價值計量分級作出披露：

4 FAIR VALUE ESTIMATION

The Group adopts HKFRS 7 for financial instruments that are measured in the consolidated financial statements at fair value, this requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:

－相同資產或負債的活躍市場報價（未經調整）
（第一層）。
Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1).
－除第一層所包括的報價外，資產或負債的可直接（即如價格）或間接（即價格衍生物）觀察的輸入值（第二層）。
Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2).
－並非依據可觀察的市場數據而釐定的資產或負債的輸入值（即不可觀察輸入值）（第三層）。
Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).
本集團可供出售金融資產通過第三層按公允價值計量。

The available-for-sale financial assets of the Group are measured at fair value by level 3.

下表分別呈列本集團於2012年和2011年12月31日按公允價值計量的資產：

The following table presents the Group’s assets that are measured at fair value at 31 December 2012 and 2011 respectively:

		第一層	第二層	第三層	合計
		Level 1	Level 2	Level 3	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
可供出售金融資產	Available-for-sale financial assets
於2012年12月31日	At 31 December 2012	–	–	181,187	181,187

於2011年12月31日	At 31 December 2011	–	–	156,000	156,000

截至2012年和2011年12月31日止年度第三層工具出現的變動載於附註11。

The changes in level 3 instruments for the years ended 31 December 2012 and 2011 are presented in Note 11.

在活躍市場中交易的金融工具之公允價值是以於資產負債表日的市場報價列賬。如果該報價可以容易地及規律地從交易市場、經銷商、經紀人、產業集團、股價服務機構或管理機構中獲得，並且這些報價是在真實、公平市場交易的基礎上定期呈現，該市場會被視為活躍。

The fair value of financial instruments traded in active markets is based on quoted market prices at the balance sheet date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis.

F-54

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-55 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

4 公允價值估計（續）

並非在活躍市場買賣的金融工具（例如場外衍生工具）公允價值以估值法釐定。該等估值法最大限度利用能獲取的可觀察市場數據而盡可能減少依賴實體的個體估計。倘計算工具公允價值需要的所有重要參數均為可觀察數據，則該工具計入第二層。

4 FAIR VALUE ESTIMATION (Cont’d)

The fair value of financial instruments that are not traded in an active market (for example, overthe-counter derivatives) is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on entity specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

5 重大會計估計及判斷

估計及判斷乃根據過往經驗及其他因素（包括在當時情況下對未來事件之合理預期）作持續評估。管理層就未來作出多項估計及假設。按其定義，就此產生之會計估計甚少相等於相關實際結果。具有導致於下一個財政年度內對資產及負債賬面值出現重大調整的主要風險的估計及假設於下文討論。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The management makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined below.

5.1 直接應佔物業開發活動的開發成本

本集團分配部份土地及開發成本至完工待售及在建銷售物業。由於本集團若干物業開發項目分若干期開發和完成，整個項目的預算開發成本取決於對總開發成果的估算。根據經驗和開發項目的性質，管理層就未來事項作出多項在當時情況下屬合理的估計及假設。鑒於物業開發活動涉及的不確定性因素，相關實際業績可能會高於或低於報告期末估算的金額。估計及假設出現任何變動將對本集團日後數年的經營表現產生影響。

5.1 Development costs directly attributable to property development activities

The Group allocates portions of land and development costs to properties held and under development for sale. As certain of the Group’s property development projects are developed and completed by phases, the budgeted development costs of the whole project are dependent on the estimate on the outcome of total development. Based on the experience and the nature of the development undertaken, the management makes estimates and assumptions concerning the future events that are believed to be reasonable under the circumstances. Given the uncertainties involved in the property development activities, the related actual results may be higher or lower than the amount estimated at the end of the reporting period. Any change in estimates and assumptions would affect the Group’s operating performance in future years.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-55

– F-56 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.2 完工待售或在建銷售物業的減值撥備

管理層根據完工待售或在建銷售物業的估計可收回金額對這些物業計提減值撥備。鑒於中國物業市場的波動性，實際可收回金額可能會高於或低於報告期末的估計。撥備的任何增加或減少將對本集團日後年度的經營表現產生影響。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.2 Provision for impairment of properties held or under development for sale

The management makes provision for impairment of properties held or under development for sale based on the estimate of the recoverable amount of the properties. Given the volatility of the property market in the PRC, the actual recoverable amount may be higher or lower than the estimate made as at the end of the reporting period. Any increase or decrease in the provision would affect the Group’s operating performance in future years.

5.3 中國土地增值稅

本集團需繳納中國土地增值稅。然而，由於有關稅項的實施及結算在中國各城市不同的稅務司法權區均有所不同，故須作出重大估計以釐定土地增值稅的金額。本集團根據管理層按其對多個稅務機關對稅務規則詮釋的理解作出的最佳估計，確認此等土地增值稅。最終稅款可能有別於最初錄得的金額，而有關差額將影響獲地方稅務機關確定該等稅項期間的所得稅開支。

5.3 Land appreciation tax of the PRc

The Group is subject to land appreciation tax in the PRC. However, since the implementation and settlement of the tax varies among various tax jurisdictions in cities of the PRC, significant estimate is required in determining the amount of the land appreciation tax. The Group recognises the land appreciation tax based on management’s best estimates according to its understanding of the interpretation of tax rules by various tax authorities. The final tax outcome could be different from the amounts that were initially recorded, and these differences will impact the income tax expense in the periods in which such taxes have been finalised with local tax authorities.

F-56

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-57 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.4 即期及遞延所得稅

本集團須繳納中國企業所得稅。在釐定企業所得稅的撥備時須作出重大判斷。在日常業務過程中，多項交易及計算方式均會導致未能確定最終所定稅項。倘這些事宜最終所得稅務與最初錄得的款額有所差異，有關差額將會影響稅項獲釐定期間的所得稅開支。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.4 current and deferred income tax

The Group is subject to corporate income tax in the PRC. Significant judgement is required in determining the provision for corporate income tax. There are many transactions and calculations for which the ultimate determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is different from the amounts that we initially recorded, such difference will impact the income tax expense in the period in which such determination is made.

倘管理層認為有可能日後會產生應課稅利潤以抵銷暫時性差異或稅務虧損，則確認此等暫時性差異及稅務虧損相關的遞延稅項資產。實際結果或會有所不同。

Deferred tax assets relating to certain temporary differences and tax losses are recognised when management considers to be probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised. The outcome of their actual utilisation may be different.

5.5 投資物業的公允價值

公允價值的最佳憑證為具有類似租約及其他合約的物業當時於活躍市場上的價格。在缺乏該等資料的情況下，管理層在合理公允價值估計的範圍內釐定金額。在作出估計時，管理層考慮不同來源的資料，包括：

5.5 Fair value of investment properties

The best evidence of fair value is current prices in an active market for the properties with similar lease and other contracts. In the absence of such information, the management determines the amount within a range of reasonable fair value estimates. In making its estimate, the management considers information from a variety of sources including:

(i) 性質、狀況或地點不同（或受不同租約或其他合約規限）的物業當時於活躍市場上的價格
（須就各項差異作出調整）；
(i) Current prices in an active market for properties of different nature, condition or location (or subject to different lease or other contracts), adjusted to reflect those differences;

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-57

– F-58 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.5 投資物業的公允價值（續）

(ii) 較不活躍市場所提供類似物業的近期價格（該價格會作出調整，以反映自按該等價格進行交易的日期起經濟狀況的任何轉變）；及

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.5 Fair value of investment properties (Cont’d)
- (ii) Recent prices of similar properties in less active markets, with adjustments to reflect any changes in economic conditions since the date of the transactions that occurred at those prices; and,
(iii) 根據對未來現金流量進行的可靠估計而預測的貼現現金流量，而該等預測乃基於任何現有租約與其他合約的條款及（如在可能情況下）外在憑證（如地點及狀況相同的類似物業當時市值租金），並採用足以反映當時市場對無法肯定的有關現金流量金額及時間進行評估的貼現率計算。
(iii) Discounted cash flow projections based on reliable estimates of future cash flows, derived from the term of any existing lease and other contract and (where possible) from external evidence such as current market rents for similar properties in the same location and condition, and using discount rates that reflect current market assessment of the uncertainty in the amount and timing of the cash flows.

本集團就在建的投資物業採取投資法，並計及所用的建設成本及完成該開發項目將產生的成本以反映已竣工開發項目的質量，依據是該物業將根據本集團最近開發計劃予以開發和完成。就已竣工投資物業而言，估值乃根據投資法透過將來自現有租約的淨租金收入（在計及物業未來可享有的潛在收入增長後）作出資本化計算，並經參考於活躍市場上的比較價格後作出。

For investment properties under construction, the Group adopted investment approach, and have taken into account the expended construction costs and the costs that will be expended to complete the development to reflect the quality of the completed development on the basis that the properties will be developed and completed in accordance with the Group’s latest development plan. For completed investment properties, valuations were based on investment approach by capitalisation of the net rental income derived from the existing tenancy agreements with due allowance for reversionary income potential of the properties and by reference to comparable price in an active market.

本集團的投資物業主要包括吾悅國際廣場的部份物業（「IP1」）和吾悅廣場一期的部份物業（「IP2」），均位於中國江蘇省常州市。IPI及IP2分別於2012年12月及3月竣工，IP1和IP2的總建築面積分別為142,556平方米（包括39,879平方米的車庫）和163,526平方米（包括21,300平方米的車庫）。

The Group’s investment properties comprise mainly a portion of Injoy International Plaza (“IP1”) and a portion of Phase I of Injoy Plaza (“IP2”), both located in Changzhou, Jiangsu Province, the PRC. IP1 and IP2 were completed in December and March 2012, respectively. Total gross floor area of IP1 and IP2 are 142,556 square meters (including carparks of 39,879 square metres) and 163,526 square meters (including carparks of 21,300 square metres) respectively.

F-58

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-59 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.5 投資物業的公允價值（續）

評估在建的投資物業及已竣工投資物業所用的主要數據列示如下：

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.5 Fair value of investment properties (Cont’d)

Major data used in the valuation of investment properties under construction and completed investment properties are as follows:

IP1

		IP1
		2012年	2011年
		12月31日	12月31日
		31 December	31 December
		2012	2011
租金單價（人民幣╱平方米╱日）	Rental rate (RMB/square meter/day)	3.20	3.79
收益率	Yield rate	6.83%	6.50%
若物業已竣工的資本價值	Capital value if completed (RMB’000)	1,685,000	1,698,000
（人民幣千元）
將產生的建設成本（人民幣千元）	Construction costs to incur (RMB’000)	–	294,851
竣工日期	Completion date	December 2012 2012年12月	End of 2012 2012年底
		IP2
		2012年	2011年
		12月31日	12月31日
		31 December	31 December
		2012	2011
租金單價（人民幣╱平方米╱日）	Rental rate (RMB/square meter/day)	1.87	2.04
收益率	Yield rate	6.39%	6.50%
若物業已竣工的資本價值	Capital value if completed (RMB’000)	1,416,000	1,552,000
（人民幣千元）
將產生的建設成本（人民幣千元）	Construction costs to incur (RMB’000)	–	11,775
竣工日期	Completion date	March 2012	Early 2012
		2012年3月	2012年初

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-59

– F-60 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.5 投資物業的公允價值（續）

租金單價乃視乎實際位置、物業類型和質量，並計及估值日期的市場數據和預測而估算。本集團於估算收益率時計及市場數據。已產生的建設成本以會計記錄中所述的已產生的實際成本為基準，而將產生的建設成本以建築物業的最新預算為基準。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.5 Fair value of investment properties (Cont’d)

The rental rates were estimated depending on the actual location, type and quality of the properties, and taking into account market data and projections at the valuation date. The Group considers the market data when estimating the yield rate. Construction costs incurred are based on the actual costs incurred as reflected in the accounting records, while the construction costs to incur are based on the most updated budget for the construction of the properties.

倘假設將產生的租金單價、收益率和建設成本較管理層的預測數據增加或減少10%，於2012年和2011年 12月31日之投資物業的賬面值將變動如下：

Were the rental rate, yield rate and the construction costs to incur assumed to increase or decrease by 10% from management’s estimate, the carrying amount of investment properties as at 31 December 2012 and 2011 would have changed as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
投資物業增加╱（減少）	Investment properties increase/(decrease)
－租金單價增加10%	– 10 percent rental rate higher	232,688		269,000
－租金單價減少10%	– 10 percent rental rate lower	(225,982)		(260,000)
投資物業增加╱（減少）	Investment properties increase/(decrease)
－所用收益率增加10%	– 10 percent yield rate used higher	(199,859)		(183,000)
－所用收益率減少10%	– 10 percent yield rate used lower	233,448		217,000
投資物業增加╱（減少）	Investment properties increase/(decrease)
－將產生的建設成本增加10%	– 10 percent construction costs to incur higher	不適用 N/A		(25,000)
－將產生的建設成本減少10%	– 10 percent construction costs to incur lower	不適用 N/A		34,000

F-60

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-61 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.6 合併法定股權低於50%的項目公司

誠如附註21和附註38所述，本集團以向信託公司轉讓項目公司股權或向信託公司發行新股份的形式與信託公司訂立若干附有於未來日期按固定金額履行購回義務的信託融資安排。在這些安排中的某些情況下，本集團持有法定股權或少於50%的董事席位。在釐定這些項目公司是否應合併入賬時須作出重大判斷。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.6 Consolidation of project companies with legal equity interests less than 50%

As stated in Note 21 and Note 38, the Group entered into a number of trust financing arrangements with trust financing companies in the form of transferring equity interests of or issuing new shares of the project companies to the trust financing companies with repurchase obligation at a fixed amount in a future date. Under certain circumstances with these arrangements, the Group holds legal equity interests or board seats at less than 50%. Significant judgement is required in determining whether these project companies shall be consolidated.

項目公司的營運環境和架構需要所有主要財務和營運政策在信託融資安排訂立前釐定。項目公司在任何重大方面不可以偏離其核定目的和設計。同時，根據多份法律文件（包括項目公司組織章程細則、信託融資安排合同、框架協議以及與信託公司訂立的其他協議），本集團保留在項目公司日常業務過程中和日常管理過程中對項目公司營運和管理的權力。董事會席位和信託公司持有的否決權╱單方面權利均為保護債權人權利的保障。

The operation environment and structure of the project companies require that all the major financial and operating policies are determined before trust financing arrangements are entered into. The project companies may not deviate from its approved purpose and design in any material respect. At the same time, according to various legal documents, including the articles of association of the project companies, trust financing arrangement contracts, framework agreements and other agreements with the trust financing companies, the Group retains the power to operate and manage the project companies in the ordinary course of business and the day-to-day management of the project companies. The board seats and the veto/unilateral rights held by the trust financing companies are considered as a protection to safeguard the creditor’s rights.

F-61

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-62 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

5 重大會計估計及判斷（續）

5.6 合併法定股權低於50%的項目公司（續）

此外，根據信託融資安排，本集團有義務在相關信託融資安排終止或屆滿時按固定金額向信託公司購回股權。鑒於有關購回的義務，該工具分類為債務。因而，信託公司僅有權事先釐定信託協議中訂明的固定回報，而本集團有權取得大部份實益權益並承擔相關項目公司營運產生的風險。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.6 Consolidation of project companies with legal equity interests less than 50% (Cont’d)

In addition, pursuant to the trust financing arrangements, the Group has the obligation to repurchase the equity interest from the trust financing companies for fixed amounts upon termination or expiry of the relevant trust financing arrangements. In light of such obligation to repurchase, the instruments are classified as debt. Accordingly, the trust financing companies are only entitled to pre-determined fixed return as specified in the trust agreements, while the Group is entitled to majority beneficiary interests and bears risks from the operation of the relevant project companies.

考慮到這些信託融資安排實質上是已抵押借款及本集團保留對這些項目公司財務和經營政策監管以從項目公司活動中獲利的實際權利，本公司董事認為項目公司應在本集團財務報表中合併入賬。

Considering the fact that the substance of these trust financing arrangements is collateralized borrowings and that the Group retains the practical ability to govern the financial and operating policies of these project companies so as to obtain benefits from activities of the project companies, the directors of the Company are of the view that the project companies shall be consolidated into the Group’s financial statements.

F-62

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-63 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

6 分部資料

管理層根據主要經營決策者審核的報告（用於作出戰略決策）釐定營運分部。王董事長被視為主要經營決策者。

6 SEGMENT INFORMATION

Management has determined the operating segments based on the reports reviewed by the CODM that are used to make strategic decisions. The chairman, Mr. Wang has been identified as the CODM.

本集團通過兩個營運分部管理業務，這與就資源分配和業績評估向本集團主要經營決策者內部呈報信息的方式一致，概無合併營運分部以形成以下可呈報分部：

The Group manages its business by two operating segments, which is consistent with the way in which information is reported internally to the Group’s CODM for the purpose of resources allocation and performance assessment. No operating segments have been aggregated to form the following reportable segments.

江蘇新城地產股份有限公司，一家其境內上市外資股於上海證券交易所上市的公司（「B 股公司」）。
Jiangsu Future Land Co., Ltd., a company listed on the Shanghai Stock Exchange with domestically listed foreign investment shares (the “B share company”).
不屬於B股公司的物業項目（「非B股公司」）。
Property projects not within the B share company (the “Non-B share companies”)

B股公司主要從事住宅物業開發，而非B股公司主要從事多用途綜合樓開發。所有物業開發項目均位於中國，因此本集團的大部份收入來自中國，及大部份資產位於中國。

The B share company is mainly engaged in development of residential properties, while the Non-B share companies are mainly engaged in development of mixed-use complexes. All the property development projects are in the PRC and accordingly majority of the revenue of the Group are derived from the PRC and most of the assets are located in the PRC.

主要經營決策者根據除所得稅和投資物業公允價值收益前的收入和利潤的計量評估營運分部的業績。計量基準不包括所得稅開支及投資物業公允價值收益的影響。

The CODM assesses the performance of the operating segments based on a measure of revenue and profit before income tax and fair value gains on investment properties. The measurement basis excludes the effects of income tax expense and fair value gains on investment properties.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-63

– F-64 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

6 分部資料（續）

6 SEGMENT INFORMATION (Cont’d)

截至2012年12月31日止年度 Year ended 31 December 2012

	B股公司非B股公司分部合計對銷本集團合計 B share company Non-B share companies total segment elimination total Group 人民幣千元人民幣千元人民幣千元人民幣千元人民幣千元 RmB’000 RmB’000 RmB’000 RmB’000 RmB’000
分部收入	Segment revenue 14,300,447 3,221,061 17,521,508 (4,242) 17,517,266
除投資物業公允	Segment profit before fair value
價值收益和所得稅	gains on investment properties
開支前分部利潤財務收入	and income tax expense 2,336,309 497,652 2,833,961 (46,886) 2,787,075 Finance income 39,759 8,293 48,052 – 48,052
融資成本	Finance costs (51,199) (108,513) (159,712) – (159,712)
折舊和攤銷應佔聯營公司業績	Depreciation and amortisation (15,458) (6,050) (21,508) – (21,508) Share of results of an associated company (5,110) – (5,110) – (5,110)

年度利潤對賬如下：

A reconciliation to profit for the year is as follows:

對銷後除投資物業	Total segment profits before
公允價值收益和	fair value gains on investment
所得稅開支前的	properties and income tax
分部利潤總額	expense after elimination	2,787,075
投資物業公允價值	Fair value gains on investment
收益	properties	31,086
所得稅開支	Income tax expense	(1,232,777)
年度利潤	Profit for the year	1,585,384

	於2012年12月31日 as at 31 December 2012
分部資產	Segment assets 29,280,647 11,581,191 40,861,838 (18,295) 40,843,543
分部資產包括：於聯營公司的投資	Segment assets include: Investments in associates 229,890 – 229,890 – 229,890
添置非流動資產	Additions to non-current assets
（除金融工具和	(other than financial
遞延稅項資產）	instruments and deferred tax assets) 15,590 640,106 655,696 – 655,696
分部負債	Segment liabilities 23,904,212 8,562,599 32,466,811 (18,295) 32,448,516

F-64

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-65 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

6 分部資料（續） 6 SEGMENT INFORMATION (Cont’d)

截至2011年12月31日止年度 Year ended 31 December 2011

		B股公司	非B股公司	分部合計	對銷	本集團合計
		B share	Non-B share
		company	companies	Total segment	Elimination	Total Group
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
分部收入	Segment revenue	9,222,245	1,549,072	10,771,317	(4,063)	10,767,254
除投資物業	Segment profit before
公允價值收益和	fair value gains on investment
所得稅開支前的	properties and income tax
分部利潤總額	expense	1,918,753	230,478	2,149,231	(37,509)	2,111,722
財務收入	Finance income	11,690	7,716	19,406	–	19,406
融資成本	Finance costs	(60,249)	(94,299)	(154,548)	–	(154,548)
折舊和攤銷	Depreciation and amortisation	(9,456)	(8,486)	(17,942)	–	(17,942)

年度利潤對賬如下：

A reconciliation to profit for the year is as follows:

對銷後除投資物業	Total segment profits before
公允價值收益和	fair value gains on investment
所得稅開支前的	properties and income tax
分部利潤總額	expense after elimination	2,111,722
投資物業公允價值	Fair value gains on investment
收益	properties	273,493
所得稅開支	Income tax expense	(941,284)
年度利潤	Profit for the year	1,443,931

				於2011年12月31日
			As	at 31 December 2011
分部資產	Segment assets	28,974,355	7,929,836	36,904,191	(3,825)	36,900,366
分部資產包括：	Segment assets includes:
於聯營公司的投資	Investments in associates	235,000	–	235,000	–	235,000
添置非流動資產	Additions to non-current assets
（除金融工具和	(other than financial
遞延稅項資產）	instruments and deferred
	tax assets)	80,641	848,749	929,390	–	929,390
分部負債	Segment liabilities	24,946,726	6,755,516	31,702,242	(3,825)	31,698,417

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-65

– F-66 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

7 物業、廠房和設備 7 PROPERTY, PLANT AND EqUIPMENT

本集團

Group

樓宇 Buildings 人民幣千元 RMB’000	汽車 Motor vehicles 人民幣千元 RMB’000	傢俬、裝置及設備 Furniture, fittings and equipment 人民幣千元 RMB’000	租賃物業裝修 Leasehold improvements 人民幣千元 RMB’000	合計 Total 人民幣千元 RMB’000
於2012年1月1日 At 1 January 2012 成本 Cost 59,805 累計折舊 Accumulated depreciation (4,555)
	28,983	27,104	39,621	155,513
	(10,876)	(9,783)	(13,283)	(38,497)

賬面淨值 Net book value 55,250	18,107	17,321	26,338	117,016

截至2012年 12月31日止年度 Year ended 31 December 2012 年初賬面淨值 Opening net book amount 55,250 添置 Additions – 出售（附註34） Disposals (Note 34) (327) 折舊費用（附註27） Depreciation charge (Note 27) (1,910)
	18,107	17,321	26,338	117,016
	859	10,741	9,325	20,925
	(92)	(471)	–	(890)
	(2,743)	(5,320)	(10,004)	(19,977)

年末賬面淨值 Closing net book amount 53,013	16,131	22,271	25,659	117,074

於2012年12月31日 At 31 December 2012 成本 Cost 59,320 累計折舊 Accumulated depreciation (6,307)
	29,297	37,152	48,946	174,715
	(13,166)	(14,881)	(23,287)	(57,641)

賬面淨值 Net book value 53,013	16,131	22,271	25,659	117,074

於2011年1月1日 At 1 January 2011 成本 Cost 15,430 累計折舊 Accumulated depreciation (3,885)	30,669 (10,572)	14,179 (5,538)	8,984 (4,873)	69,262 (24,868) 44,394 44,394 71,665 21,760 (4,153) (16,650) 117,016 155,513 (38,497) 117,016
賬面淨值 Net book value 11,545	20,097	8,641	4,111
截至2011年12月31日止年度 Year ended 31 December 2011 年初賬面淨值 Opening net book amount 11,545 轉至完工待售或在建銷售物業 Transferred from properties held or under development for sale 46,013 其他添置 Other additions – 出售（附註34） Disposals (Note 34) (1,102) 折舊費用（附註27） Depreciation charge (Note 27) (1,206)	20,097 – 2,984 (1,968) (3,006)	8,641 – 13,791 (1,083) (4,028)	4,111 25,652 4,985 – (8,410)
年末賬面淨值 Closing net book amount 55,250	18,107	17,321	26,338
於2011年12月31日 At 31 December 2011 成本 Cost 59,805 累計折舊 Accumulated depreciation (4,555)	28,983 (10,876)	27,104 (9,783)	39,621 (13,283)
賬面淨值 Net book value 55,250	18,107	17,321	26,338

F-66 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-67 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

7 物業、廠房和設備（續）

截至2012年及2011年12月31日止年度，本集團物業、廠房和設備的折舊費用已悉數計入行政開支或營銷成本。

7 PROPERTY, PLANT AND EqUIPMENT (Cont’d)

The Group’s depreciation charges of property, plant and equipment have all been included in administrative expenses or selling and marketing costs for the years ended 31 December 2012 and 2011.

8 投資物業

8 INVESTMENT PROPERTIES

8 投資物業	8	INVESTMEN	T PROPERTIE	S
		竣工	開發中	合計
			Under
		completed	development	Total
		人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000
於2012年1月1日添置	At 1 January 2012 Additions	4,200 –	2,439,000 631,314	2,443,200 631,314
項目竣工(a)	Completion of projects (a)	3,070,314	(3,070,314)	–
公允價值收益	Fair value gains	31,086	–	31,086
於2012年12月31日	At 31 December 2012	3,105,600	–	3,105,600
於2011年1月1日	At 1 January 2011	8,900	1,334,000	1,342,900
添置	Additions	–	831,507	831,507
出售	Disposals	(4,700)	–	(4,700)
公允價值收益	Fair value gains	–	273,493	273,493
於2011年12月31日	At 31 December 2011	4,200	2,439,000	2,443,200

(a) 用作投資物業的部份吾悅廣場一期及吾悅國際廣場已分別於2012年3月及12月竣工。
(a) The portion of Phase I of Injoy Plaza and Injoy International Plaza used as investment properties were completed in March and December 2012, respectively.
(b) 截至2012年12月31日止年度，撥入投資物業的資本化借貸成本約為人民幣80,006,000元
（2011年：人民幣83,229,000元）。
(b) Borrowing costs capitalised in investment properties for the year ended 31 December 2012 were approximately RMB80,006,000 (2011: RMB83,229,000).

截至2012年12月31日止年度，借款資本化率為 11.06%（2011年：11.67%）。

The capitalisation rate of borrowings was 11.06% for the year ended 31 December 2012 (2011: 11.67%).

所有投資物業於2012年及2011年12月31日由獨立專業合資格估值師戴德梁行有限公司進行重估。

All investment properties were revalued as at 31 December 2012 and 2011 by DTZ Debenham Tie Leung Limited, an independent professional qualified valuer.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-67

– F-68 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

8 投資物業（續）

就已竣工物業而言，估值乃透過將現有租約的未來淨租金收入（在計及物業未來可享有的潛在收入增長後）作出資本化計算或運用直接比較法，假設各項物業按現有狀況交吉出售，並參考有關市場的可比較銷售交易作出。下列已竣工投資物業租金收入已於合併利潤表內確認：

8 INVESTMENT PROPERTIES (Cont’d)

For completed properties, valuations were based on either capitalisation of net rental income derived from the existing tenancies with allowance for the reversionary income potential of the properties or on direct comparison approach assuming sale of each of these properties in its existing state with the benefit of vacant possession by making reference to comparable sales transactions as available in the relevant market. The following rental income from completed investment properties has been recognised in the consolidated statement of income:

截至12月31日止年度 Year ended 31 December

		2012年	2011年
		2012	2011
		人民幣千元	人民幣千元
		RMB’000	RMB’000
租金收入	Rental income	23,634	445

就在建投資物業，估值乃按投資法計算，並計及已支銷建築成本及完成開發項目所需支出的成本，以反映開發項目竣工時的質量，依據是該物業將根據本集團最近開發計劃予以開發和完成。

For investment properties under construction, valuations were based on investment approach, and have taken into account the expended construction costs and the costs that will be expended to complete the development to reflect the quality of the completed development on the basis that the properties will be developed and completed in accordance with the Group’s latest development plan.

F-68

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-69 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

8 投資物業（續）

本集團於投資物業的權益按其賬面淨值分析如下：

8 INVESTMENT PROPERTIES (Cont’d)

The Group’s interests in investment properties at their net book values are analysed as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
在中國，	In the PRC, held on:
按原本40年租約持有（而於2012年	Leases with original term of 40 years
12月31日，餘下未到期	(and remaining unexpired period of 34 years and
年期為34年及37年）	37 years as at 31 December 2012)	3,101,400		2,439,000
按原本70年租約持有（而於2012年	Leases with original term of 70 years
12月31日，餘下未到期	(and remaining unexpired period of 55 years
年期為55年）	as at 31 December 2012)	4,200		4,200
		3,105,600		2,443,200

於2012年12月31日，賬面總值約為人民幣 1,416,400,000元（2011年：人民幣852,070,000元）的投資物業已抵押作本集團借款的抵押品（附註21）。

Investment properties with a total carrying amount of RMB1,416,400,000 as at 31 December 2012 (2011: RMB852,070,000) were pledged as collateral for the Group’s borrowings (Note 21).

F-69

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-70 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

9 無形資產 9 INTANGIBLE ASSETS

Group 商標 Trademarks 人民幣千元 RMB’000 本集團	電腦軟件 computer software 人民幣千元 RMB’000	合計 Total 人民幣千元 RMB’000
於2012年1月1日 At 1 January 2012 成本 Cost 800 累計攤銷 Accumulated amortisation (667)
	8,438	9,238
	(3,230)	(3,897)

賬面淨值 Net book amount 133	5,208	5,341

截至2012年12月31日止年度 Year ended 31 December 2012 年初賬面淨值 Opening net book amount 133 添置 Additions – 攤銷費用（附註27） Amortisation charge (Note 27) (80)
	5,208	5,341
	3,457	3,457
	(1,451)	(1,531)

年末賬面淨值 Closing net book amount 53	7,214	7,267

於2012年12月31日 At 31 December 2012 成本 Cost 800 累計攤銷 Accumulated amortisation (747)
	11,895	12,695
	(4,681)	(5,428)

賬面淨值 Net book amount 53	7,214	7,267

於2011年1月1日 At 1 January 2011 成本 Cost 800 累計折舊 Accumulated amortisation (587)	3,980 (2,018)	4,780 (2,605) 2,175 2,175 4,458 (1,292) 5,341 9,238 (3,897) 5,341
賬面淨值 Net book amount 213	1,962
截至2011年12月31日止年度 Year ended 31 December 2011 年初賬面淨值 Opening net book amount 213 添置 Additions – 攤銷費用（附註27） Amortisation charge (Note 27) (80)	1,962 4,458 (1,212)
年末賬面淨值 Closing net book amount 133	5,208
於2011年12月31日 At 31 December 2011 成本 Cost 800 累計攤銷 Accumulated amortisation (667)	8,438 (3,230)
賬面淨值 Net book amount 133	5,208

截至2012年及2011年12月31日止年度，本集團無形資產的攤銷費用已悉數計入行政開支。

The Group’s amortisation charges of intangible assets have all been included in administrative expenses for the years ended 31 December 2012 and 2011.

F-70

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-71 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

10 於聯營公司的投資 10 INVESTMENTS IN ASSOCIATES

本集團

Group

本集團	Group
		截至12月31日止年度
		Year ended 31 December
		2012年 2011年
		2012 2011
		人民幣千元人民幣千元
		RMB’000 RMB’000
期初結餘	Opening balance	235,000 10,000
－於Shanghai Lan Tian Business	– Investment in Shanghai Lan Tian Business
Development Property Co., Ltd.	Development Property Co., Ltd.
（「Shanghai Lan Tian」）	(“Shanghai Lan Tian”) (a)
的投資(a)		10,000 10,000
－於上海萬之城房地產開發	– Investment in Shanghai Wan Zhi Cheng Real
有限公司（「上海萬之城」）	Estate Development Co., Ltd.
的投資(b)	(“Shanghai Wan Zhi Cheng”) (b)	225,000 –
增加	Additions
－於上海萬之城的投資(b)	– Investment in Shanghai Wan Zhi Cheng (b)	– 225,000
應佔業績	Share of results
－上海萬之城(b)	– Shanghai Wan Zhi Cheng (b)	(5,110) –
期末結餘	Ending balance	229,890 235,000

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-71

– F-72 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

10 於聯營公司的投資（續）

(a) Shanghai Lan Tian在2010年8月4日成立。本集團擁有該公司20%的股權。

10 INVESTMENTS IN ASSOCIATES (Cont’d)

(a) Shanghai Lan Tian was established on 4 August 2010. The Group owns 20% of equity interest in this company.

本集團應佔Shanghai Lan Tian的業績以及資產和負債總額列示如下：

The Group’s share of results and the aggregated assets and liabilities of Shanghai Lan Tian are as follows:

所持權益

		所持權益
		百分比	總資產	總負債	總收入	淨利潤
		% interests	Total	Total	Total	Net
		held	assets	liabilities	revenue	profit
			人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000
於及截至2012年12月31日	As at and for the year
止年度	ended 31 December 2012	20%	10,057	–	–	15
於及截至2011年12月31日	As at and for the year
止年度	ended 31 December 2011	20%	10,042	–	–	24

(b) 上海萬之城在2011年3月29日成立。本集團擁有該公司50%的股權。

(b) Shanghai Wan Zhi Cheng was established on 29 March 2011. The Group owns 50% of equity interest in this company.

本集團應佔上海萬之城的業績以及資產和負債總額列示如下：

The Group’s share of results and the aggregated assets and liabilities of Shanghai Wan Zhi Cheng are as follows:

		所持權益
		百分比	總資產	總負債	總收入	淨虧損
		% interests	Total	Total	Total	Net
		held	assets	liabilities	revenue	loss
			人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000
於及截至2012年12月31日	As at and for the year
止年度	ended 31 December 2012	50%	859,407	639,975	–	5,110
於及截至2011年12月31日	As at and for the year
止年度	ended 31 December 2011	50%	670,795	446,253	–	458

F-72

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-73 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

10 於聯營公司的投資（續）

(b) （續）

10 INVESTMENTS IN ASSOCIATES (Cont’d)

(b) (Cont’d)

儘管本集團持有上海萬之城50%的股權，但本集團將其於上海萬之城的投資列作聯營公司核算。根據與上海萬之城其他50%股權持有人訂立的合同，其他投資者以大多數董事會席位和其他合約權利控制上海萬之城。然而，本集團可對上海萬之城施加重大影響。

The Group accounts for its investment in Shanghai Wan Zhi Cheng as an associate although the Group holds 50% of equity interest. According to the contract with the other 50% equity interest holder of Shanghai Wan Zhi Cheng, the other investor controls Shanghai Wan Zhi Cheng with majority seats on the board of directors and other contractual rights. The Group, however, has significant influence over Shanghai Wan Zhi Cheng.

11 可供出售金融資產

本集團

11 AVAILABLE-FOR-SALE FINANCIAL ASSETS

Group

截至12月31日止年度 Year ended 31 December

		2012年	2011年
		2012	2011
		人民幣千元	人民幣千元
		RMB’000	RMB’000
期初結餘	Opening balance	156,000	156,000 (a)
收購	Acquisitions	25,187 (d,e,f)	53,066 (b,c)
出售	Disposals	–	(53,066) (b,c)
期末結餘	Ending balance	181,187	156,000

(a) 於2010年9月2日，本集團以代價人民幣 156,000,000元收購蘇州銀行1%的股權。此項金融資產分別於2012年及2011年12月31日的公允價值相對收購成本並無重大變動。

(a) On 2 September 2010, the Group acquired 1% equity interest in Bank of Suzhou at a consideration of RMB156,000,000. There is no significant change in fair value of the financial asset as at 31 December 2012 and 2011, respectively from the acquisition cost.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-73

– F-74 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

11 可供出售金融資產（續）

(b) 於2011年3月29日，本集團以代價人民幣38,065,500元收購Suzhou Fei Cui International Community Property Co., Ltd.（「Suzhou Fei Cui」）5%的股權。於 2011年9月9日，出售該股權所得款項為人民幣88,065,500元。該出售產生人民幣 50,000,000元的收益淨額（附註26）。

11 AVAILABLE-FOR-SALE FINANCIAL ASSETS (Cont’d)

(b) On 29 March 2011, the Group acquired 5% equity interest in Suzhou Fei Cui International Community Property Co., Ltd. (“Suzhou Fei Cui”) at a consideration of RMB38,065,500. This equity interest was disposed at a proceed of RMB88,065,500 on 9 September 2011. This disposal gave rise to a net gain of RMB50,000,000 (Note 26).
(c) 於2011年9月20日，本集團於國內基金市場認購公眾投資基金人民幣15,000,000元。於 2011年11月11日，出售該投資基金所得款項為人民幣15,266,000元。該出售產生人民幣 266,000元的收益淨額（附註26）。
(c) On 20 September 2011, the Group subscribed public investment fund of RMB15,000,000 in domestic fund market. This investment fund was disposed at a proceed of RMB15,266,000 on 11 November 2011. This disposal gave rise to a net gain of RMB266,000 (Note 26).
(d) 於2012年4月10日，本集團以代價人民幣5,187,000元收購Shanghai Jingying Investment Management Limited Partnership 6.19%的股權。此項金融資產於2012年12月 31日的公允價值相對收購成本並無重大變動。
(d) On 10 April 2012, the Group acquired 6.19% equity interest in Shanghai Jingying Investment Management Limited Partnership at a consideration of RMB5,187,000. There is no significant change in fair value of the financial asset as at 31 December 2012 from the acquisition cost.
(e) 於2012年10月15日，本集團以代價人民幣 50,000,000元（其中人民幣15,000,000元已於截至2012年12月31日止年度內支付）收購 Shanghai Wuling Investment Management Limited Partnership 5.26%的股權。此項金融資產於2012年12月31日的公允價值相對收購成本並無重大變動。
(e) On 15 October 2012, the Group acquired 5.26% equity interest in Shanghai Wuling Investment Management Limited Partnership at a consideration of RMB50,000,000, with an amount of RMB15,000,000 already paid during the year ended 31 December 2012. There is no significant change in fair value of the financial asset as at 31 December 2012 from the acquisition cost.
(f) 於2012年11月2日，本集團以代價人民幣 25,000,000元（其中人民幣5,000,000元已於截至2012年12月31日止年度內支付）收購Gefei Assets Management Limited Partnership 2.72%的股權。此項金融資產於 2012年12月31日的公允價值相對收購成本並無重大變動。
(f) On 2 November 2012, the Group acquired 2.72% equity interest in Gefei Assets Management Limited Partnership at a consideration of RMB25,000,000, with an amount of RMB5,000,000 already paid during the year ended 31 December 2012. There is no significant change in fair value of the financial asset as at 31 December 2012 from the acquisition cost.

F-74 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-75 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

12 土地使用權

本集團

此餘額為一項待場地取得所需批准重新規劃作商業用途後將用於物業開發並銷售的土地使用權。

12 LAND USE RIGHTS

Group

The balance represents land use rights to be used for development of properties for sale in the future upon obtaining the necessary approval to re-zone the site for commercial use.

13 租賃土地預付款項

本集團

本集團於截止2012年12月31日預付人民幣 4,313,847,000元用於購買租賃土地使用權（2011 年：人民幣2,689,155,000元）。

13 PREPAYMENTS FOR LEASEHOLD LAND

Group

The Group made prepayments of RMB4,313,847,000 for the acquisition of leasehold land as at 31 December 2012 (2011: RMB2,689,155,000).

14 完工待售或在建銷售物業

本集團

14 PROPERTIES HELD OR UNDER DEVELOPMENT FOR SALE

Group

		於12月31日	於12月31日
		As at 31	December
		2012年	2011年
		2012	2011
		人民幣千元	人民幣千元
		RMB’000	RMB’000
將予開發的租賃土地	Leasehold land to be developed	1,518,738	2,376,518
在建銷售物業	Properties under development for sale	17,089,398	20,225,414
完工待售物業	Properties held for sale	6,235,028	2,107,534
		24,843,164	24,709,466
減：減值虧損撥備	Less: Provision for impairment loss	(349,412)	(482,400)
		24,493,752	24,227,066

完工待售或在建銷售物業均位於中國。

The properties held or under development for sale are all located in the PRC.

截至2012年12月31日止年度，於完工待售和在建銷售物業中資本化的借款成本約為人民幣776,028,000 元（2011年：人民幣788,210,000元）。

Borrowing costs capitalised in properties under development for sale and held for sale for the year ended 31 December 2012 were approximately RMB776,028,000 (2011: RMB788,210,000).

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-75

– F-76 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

14 完工待售或在建銷售物業（續）

截至2012年12月31日止年度，借款資本化率為 9.71%（2011年：9.30%）。

14 PROPERTIES HELD OR UNDER DEVELOPMENT FOR SALE (Cont’d)

The capitalisation rate of borrowings was 9.71% for the year ended 31 December 2012 (2011: 9.30%).

於2012年及2011年12月31日，本集團以下將予開發的租賃土地、在建銷售物業和完工待售物業已抵押作本集團借款的抵押品（附註21）。

As at 31 December 2012 and 2011, the Group’s following leasehold land to be developed, properties under development for sale and properties held for sale were pledged as collateral for the Group’s borrowings (Note 21).

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
已抵押的賬面值：	Carrying value pledged:
將予開發的租賃土地	Leasehold land to be developed	642,204		1,069,912
在建銷售物業	Properties under development for sale	7,234,330		6,900,317
完工待售物業	Properties held for sale	931,768		34,158

截至2012年12月31日止年度，確認為開支及計入銷售成本的完工待售物業成本為人民幣 12,575,554,000元，連帶撥回的減值撥備人民幣 132,988,000元已貸記入銷售成本。截至2011年 12月31日止年度，確認為開支的金額為人民幣 7,071,994,000元，包括計提的減值撥備人民幣 398,726,000元。

For the year ended 31 December 2012, the cost of properties held for sale recognised as expense and included in cost of sales amounted to RMB12,575,554,000, accompanying by a reversal of provision for impairment of RMB132,988,000 credited to cost of sales. For the year ended 31 December 2011, the amount recognised as expense was RMB7,071,994,000, which included an accrual of provision for impairment of RMB398,726,000.

於2012年12月31日，總賬面值為人民幣 6,205,262,000元（2011年：人民幣7,866,685,000 元）的在建銷售物業與不預期於一年內竣工的物業項目相關，儘管可能會預售若干此等物業。所有在建租賃土地不預期於一年內竣工。完工待售或在建銷售物業的其他結餘預計可於一年內變賣。

As at 31 December 2012, properties under development for sale with a total carrying amount of RMB6,205,262,000 (2011: RMB7,866,685,000) were related to property projects which were not scheduled to complete within one year although pre-sales of some of these properties may occur. All the leasehold land to be developed were not scheduled to complete within one year. The other balances in properties held or under development for sale were expected to be recovered within one year.

F-76

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-77 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

15 貿易和其他應收款項及預付款項

本集團

15 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS

Group

於12月31日 As at 31 December

		於12月31日 As at 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
貿易應收款項	Trade receivables	3,265 7,085
應收票據	Notes receivable	300 25,227
貿易應收款項合計	Total trade receivables	3,565 32,312
減：應收款項減值撥備	Less: Provision for impairment of receivables	– –
貿易應收款項－淨額	Trade receivables – net	3,565 32,312
應收關連方款項（附註37）	Receivable from a related party (Notes 37)	180,000 390,367
預付營業稅和附加費(i)	Prepaid business tax and surcharges (i)	645,416 704,862
預付所得稅和土地增值稅(i)	Prepaid income tax and land appreciation tax (i)	377,514 414,993
投標保證金(ii)	Tender deposits (ii)	196,190 –
於住房公積金中心的按金(iii)	Deposits with public housing fund centres (iii)	116,989 93,815
預付建設成本	Prepayments for construction costs	89,491 87,428
其他	Others	57,101 37,829
		1,666,266 1,761,606

(i) 營業稅、附加費和土地增值稅於本集團收到客戶預付款時預徵收，此等預付稅項於相關收入確認前列作預付款項。此外，在計算應課稅收入時，按本集團收到的預付款的5%至 15%計算的預計利潤需計入會計收入，據此預付的所得稅同樣列作預付款項。

(i) B u s i n e s s t a x , s u rc h a r g e s a n d l a n d appreciation tax are provisionally levied when the Group receives advances from customers and the prepaid taxes are recorded as prepayments before the relevant revenue is recognised. In addition, a deemed profit at 5% to 15% of advances received by the Group is added to the accounting income when calculating taxable income and the prepaid income tax is similarly recorded as prepayments.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-77

– F-78 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

15 貿易和其他應收款項及預付款項（續）

(ii) 此結餘為土地使用權競標的投標保證金，將於其後收回或轉撥至租賃土地預付款項。

15 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

(ii) This balance represents the tender deposits for bidding of land use rights, which will be subsequently received or transferred to prepayments for leasehold land.
(iii) 此結餘為向住房公積金中心支付的按金以擔保本集團若干購房者的住房公積金貸款。這些按金將於政府部門發出物業所有權證至這些購房者並向住房公積金中心提交時予以解除。
(iii) This balance represents the deposits paid to public housing fund centres to secure the housing fund loans taken by certain property purchasers of the Group. Such deposits will be released upon the issue of the properties’ ownership certificate by government authorities to these purchasers and submitted to the public housing fund centres.

貿易應收款項於2012年及2011年12月31日的賬齡分析如下：

The aging analysis of trade receivables as at 31 December 2012 and 2011 are as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Less than 1 year	2,555		31,302
一至二年	Between 1 and 2 years	–		–
二至三年	Between 2 and 3 years	–		–
三年以上	Over 3 years	1,010		1,010
		3,565		32,312

F-78

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-79 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

15 貿易和其他應收款項及預付款項（續）

於2012年和2011年12月31日，貿易應收款項人民幣 1,010,000元已逾期但並無減值。這些結餘與最近並無拖欠付款記錄的獨立客戶有關。這些貿易應收款項的賬齡分析如下：

15 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

As at 31 December 2012 and 2011, trade receivables of RMB1,010,000 were past due but not impaired. The balances are related to an independent customer for whom there is no recent history of default. The aging analysis of these trade receivables is as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Less than 1 year	–		–
一至二年	Between 1 and 2 years	–		–
二至三年	Between 2 and 3 years	–		–
三年以上	Over 3 years	1,010		1,010
		1,010		1,010

於2012年和2011年12月31日承受的最大信貸風險是上述各類應收款項的賬面值。本集團並無持有任何抵押品。

The maximum exposure to credit risk at 31 December 2012 and 2011 is the carrying value of each class of receivables mentioned above. The Group does not hold any collateral security.

於2012年和2011年12月31日，貿易和其他應收款項的公允價值與其賬面值相若。

As at 31 December 2012 and 2011, the fair value of trade and other receivables approximate their carrying amounts.

於2012年和2011年12月31日，貿易和其他應收款項及預付款項的賬面值主要以人民幣計值。

As at 31 December 2012 and 2011, the carrying amounts of trade and other receivables and prepayments are primarily denominated in RMB.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-79

– F-80 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

15 貿易和其他應收款項及預付款項（續）

15 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

company 於12月31日 As at 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000 本公司	company 於12月31日 As at 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000 本公司
應收關連方款項（附註37） Receivables from related parties (Notes 37) 717,847 其他應收賬款 Other receivables 570	– –
718,417	–

應收關連方款項和其他應收款項全部於一年內到期。

The aging of the receivables from related parties and other receivables are all within 1 year.

應收關連方款項和其他應收款項的公允價值與賬面值相若。

The fair value of the receivables from related parties and other receivables approximate their carrying amounts.

應收關連方款項和其他應收款項賬面值全部以港元計值。

The carrying amounts of the receivables from related parties and other receivables are all denominated in HKD.

16 於子公司的投資 16 INVESTMENTS IN SUBSIDIARIES

本公司

company

於12月31日 As at 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000	於12月31日 As at 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
未上市股權投資，按成本 Unlisted equity investments, at cost 424,271	387,574

本公司子公司於2012年及2011年12月31日的詳情載於合併財務報表附註38。於子公司的投資並無作出減值撥備。於子公司投資的增加來自授予本公司子公司僱員和業務夥伴的首次公開發售前股份獎勵計劃（附註19）。

Particulars of the Company’s subsidiaries as at 31 December 2012 and 2011 are set out in Note 38 to the consolidated financial statements. No provision for impairment has been made against investments in subsidiaries. The increase in investments in subsidiaries pertains to the Pre-IPO share award scheme (Note 19) granted to the employees and business partners of the Company’s subsidiaries.

F-80

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-81 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

17 銀行和手頭現金

本集團

17 CASH AT BANK AND ON HAND

Group

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
銀行和手頭現金	Cash at bank and on hand
以人民幣計值	Denominated in RMB	5,665,041		4,531,444
以美元計值	Denominated in USD	47		5
以港元計值	Denominated in HKD	335,131		4,645
		6,000,219		4,536,094

於2012年12月31日，本集團銀行存款的實際利率為 0.91%（2011年：0.50%）。

The effective interest rate on the Group’s bank deposits as at 31 December 2012 was 0.91% (2011: 0.50%).

本集團的現金和現金等價物釐定如下：

Cash and cash equivalents of the Group were determined as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
銀行和手頭現金	Cash at bank and on hand	6,000,219		4,536,094
減：受限制現金	Less: Restricted cash	(1,148,089)		(314,536)
		4,852,130		4,221,558

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-81

– F-82 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

17 銀行和手頭現金（續）

17 CASH AT BANK AND ON HAND

(Cont’d)

本集團的受限制現金包括以下各項：

Restricted cash of the Group comprised of the following:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
作為項目建設簽發保函的保證金	Deposits for letters of guarantee issued for
	project construction	22,107		8,649
票據保證金	Margin deposits for notes issued	637,748		39,121
購房者按揭貸款保證金(a)	Deposits as security for property purchasers’
	mortgage loans (a)	42,645		50,766
作為借款抵押的存款（附註21）	Deposits pledged for borrowings (Note 21)	45,589		216,000
定期存款(b)	Time deposit (b)	400,000		–
		1,148,089		314,536

(a) 這些受限制銀行存款用於確保本集團若干購房者根據若干城市的地方法規能取得銀行貸款。這些存款將於物業所有權證由政府部門發出給這些購房者並向按揭銀行提交時予以解除。
(b) 於2012年12月31日，這筆受限制定期存款用於申請銀行借貸。
(a) These bank deposits are restricted to secure the bank loans taken by certain property purchasers of the Group pursuant to the local regulations of certain cities. Such deposits will be released upon the issue of the properties’ ownership certificate by government authorities to these purchasers and submitted to the mortgage banks.
(b) The time deposit is restricted for application of bank borrowings as at 31 December 2012.

本公司

company

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
銀行和手頭現金	Cash at bank and on hand
以人民幣計值	Denominated in RMB	877,935		–
以美元計值	Denominated in USD	47		–
以港元計值	Denominated in HKD	17,325		4,626
		895,307		4,626

於2012年12月31日，本公司銀行存款的實際利率為

0.22%（2011年：0.06%）。

The effective interest rate on the Company’s bank deposits as at 31 December 2012 was 0.22% (2011: 0.06%).

F-82

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-83 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

18 股本

本集團和本公司

18 SHARE CAPITAL

Group and company

(a) 法定股本 (a) Authorised shares

		法定股本數目	法定股本數目
		Number of authorised shares
		美元股份	港元股份
		USD share	HKD share
於2011年1月1日	As at 1 January 2011	50,000	–
於2011年9月12日重新計值	Re-denomination and cancellation on
和註銷(i)	12 September 2011 (i)	(50,000)	390,000,000
於2011年9月12日增加(ii)	Increase on 12 September 2011 (ii)	–	9,610,000,000
於2011年及2012年12月31日	As at 31 December 2011 and 2012	–	10,000,000,000

(i) 於2011年9月12日，本公司透過增設額外390,000,000股每股面值為0.001 港元的股份（「港元股份」）將其法定股本面額由50,000美元更改為50,000 美元和390,000港元的總額。同日，誠如下文附註18(b)(i)所披露，Wealth Zone Hong Kong持有的4,421股已發行美元股份已透過發行34,483,800股港元股份所得款項購回。緊接購回美元股份後，法定但未發行股本透過註銷50,000股美元股份得以削減。
(i) O n 1 2 S e p t e m b e r 2 0 1 1 , t h e Company re-denominated the authorised share capital of the Company from USD50,000 to the aggregate of USD50,000 and HKD390,000 by the creation of an additional 390,000,000 shares of par value HKD0.001 each (“HKD share”). On the same day, as disclosed in Note 18(b)(i) below, the issued 4,421 USD shares held by Wealth Zone Hong Kong were repurchased with the proceeds received from the issue of 34,483,800 HKD shares. Immediately after the repurchase of the USD shares, the authorised but unissued share capital was reduced by the cancellation of 50,000 USD shares.
(ii) 於2011年9月12日，本公司透過增設 9,610,000,000股新港元股份將法定股本由390,000港元增至10,000,000港元，分為10,000,000,000股每股面值 0.001港元的股份。
(ii) O n 1 2 S e p t e m b e r 2 0 1 1 , t h e Company increased the authorised share capital from HKD390,000 to HKD10,000,000 divided into 10,000,000,000 shares of par value HKD0.001 each by the creation of 9,610,000,000 new HKD shares.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-83

– F-84 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

18 股本（續）

18 SHARE CAPITAL (Cont’d)

(b) 已發行股份 (b) Issued shares

		已發行股份數目	已發行股份數目	普通股
		Number of		Ordinary
		issued shares		shares
		每股1美元	每股0.001港元	人民幣元
		USD1 each	HKD0.001 each	RMB
於2011年1月1日	As at 1 January 2011	4,421	–	28,746
普通股重新計值(i)	Re-denomination of ordinary shares (i)	(4,421)	34,483,800	–
發行普通股(ii)	Issuance of ordinary shares (ii)	–	4,034,466,200	3,289,703
就首次公開發售前股份	Issuance of ordinary shares in
獎勵計劃發行普通股(iii)	connection with Pre-IPO share
	award scheme (iii)	–	181,050,000	147,628
於2012年1月1日	As at 1 January 2012	–	4,250,000,000	3,466,077
發行普通股(iv)	Issuance of ordinary shares (iv)	–	1,418,000,000	1,150,992
於2012年12月31日	As at 31 December 2012	–	5,668,000,000	4,617,069

(i) 於2011年9月12日，34,483,800股每股面值0.001港元的港元股份已配發和發行予Wealth Zone Hong Kong，及 Wealth Zone Hong Kong持有的4,421 股美元股份已透過發行港元股份所得款項購回。
(i) On 12 September 2011, 34,483,800 HKD shares at par value of HKD0.001 each were allotted and issued to Wealth Zone Hong Kong and 4,421 USD shares held by Wealth Zone Hong Kong were repurchased with the proceeds received from the issue of the HKD shares.
(ii) 於 2 0 1 1 年 9 月 1 2 日，額外 4,034,466,200股每股面值0.001港元的港元股份（入賬列作繳足）已配發和發行予Wealth Zone Hong Kong，以取得現金對價4,034,466港元（相等於人民幣3,289,703元）。
(ii) O n 1 2 S e p t e m b e r 2 0 1 1 , a n additional 4,034,466,200 HKD shares at par value of HKD0.001 each were allotted and issued to Wealth Zone Hong Kong for cash consideration of HKD4,034,466 (equivalent to RMB3,289,703), which were credited as fully paid.

F-84 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-85 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

18 股本（續）

(b) 已發行股份 （續）
(iii) 於2011年9月12日，181,050,000股每股面值0.001港元的港元股份已配發和發行予由關連方Wang Xiaosong先生擁有的Wellink Global (PTC) Limited
（附註37(a)）以取得現金對價181,050 港元（相等於人民幣147,628元）。此項發行與首次公開發售前股份獎勵計劃相關（附註19）。

18 SHARE CAPITAL (Cont’d)

(b) Issued shares (Cont’d)
- (iii) O n 1 2 S e p t e m b e r 2 0 1 1 , 181,050,000 HKD shares at par value of HKD0.001 each were allotted and issued to Wellink Global (PTC) Limited, which is owned by a related party Mr. Wang Xiaosong (Note 37(a)) for cash consideration of HKD181,050 (equivalent to RMB147,628) in connection with the pre-IPO share award scheme (Note 19).
(iv) 於2012年11月29日，本公司就上市按每股1.45港元發行1,418,000,000股每股0.001港元的港元普通股，並籌得總額約2,056,100,000港元（相等於人民幣1,668,936,000元）的款項。所得款項超過發行1,418,000,000股普通股面值共為人民幣1,150,992元的金額為人民幣1,667,785,008元，扣除發行新股直接相關的費用共人民幣65,165,000 元後為人民幣1,602,620,008元，此金額撥入股份溢價賬（附註20）。
(iv) On 29 November 2012, the Company issued 1,418,000,000 HKD ordinary shares of HKD0.001 each at HKD1.45 per share in connection with the Listing, and raised gross proceeds of approximately HKD2,056,100,000 (equivalent to RMB1,668,936,000). The excess of RMB1,667,785,008 over the par value of RMB1,150,992 for the 1,418,000,000 HKD ordinary shares issued, net of the relevant incremental costs of RMB65,165,000 directly contributable to the new shares issued, was credited to “share premium” with amount of RMB1,602,620,008 (Note 20).

19 以股份為基礎的支付

根據2011年9月12日的決議案，本公司採納首次公開發售前股份獎勵計劃（「股份獎勵計劃」）。根據股份獎勵計劃，合共159,800,000股股份和21,250,000股股份分別發行和授予選定現任僱員（包括董事）和若干第三方。第三方包括前僱員和若干第三方公司。授予第三方公司的股份乃為認可其過往服務。

19 SHARE-BASED PAYMENTS

Pursuant to a resolution dated 12 September 2011, the Company adopted a Pre-IPO share award scheme (the “Share Award Scheme”). Under the Share Award Scheme, a total number of 159,800,000 shares and 21,250,000 shares were issued and granted to selected current employees (including directors) and certain third parties, respectively. The third parties include former employees and certain third party companies. The shares granted to third parties are for recognition of their past services.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-85

– F-86 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts 截至2012年12月31日止年度 For the year ended 31 December 2012

19 以股份為基礎的支付（續）

至於授予現任僱員（包括董事）的股份，在本公司於 2012年6月30日前在香港聯合交易所有限公司主板上市及僱員於各歸屬期末仍在職的情況下，授出的股份可分別於2012年、2013年、2014年和2015年12月 31日分四等份歸屬。

19 SHARE-BASED PAYMENTS (Cont’d)

For shares granted to current employees (including directors), subject to the meeting of the criteria of the Company being listed on the Main Board of the Stock Exchange of Hong Kong Limited before 30 June 2012 and the employee being still on service at the end of each vesting period, the granted shares can be vested in four equal tranches on 31 December 2012, 2013, 2014 and 2015, respectively.

於2012年6月30日，本公司修訂以股份支付的條件，延長本公司於2012年6月30日前於香港聯合交易所有限公司主板上市這項要求至2013年12月31日前。

On 30 June 2012, the Company modified the condition for the share-based payments by extending the criteria of the Company being listed on the Main Board of the Stock Exchange of Hong Kong Limited before 30 June 2012 to 31 December 2013.

根據股份獎勵計劃授出的股份於2011年9月15日（授出日期）的公允價值為人民幣119,766,309元，此價值根據資產基礎法釐定，且總體業績亦通過使用市場法反復審核。根據資產基礎法釐定各項資產╱負債的價值須使用多種估值法╱技術，如投資物業使用剩餘法估值，而非流通股則使用可資比較公司法估值，並以期權定價模式幫助釐定非流動性折扣。

The fair value of the shares granted under the Share Award Scheme as at 15 September 2011, the grant date, was RMB119,766,309, and was determined using the asset-based approach and the overall result was also cross-checked by using the market approach. Various valuation methods/ techniques were applied to determine the value of each asset/liability under the asset-based approach, for example the investment properties were valued using the residual method while the nontradable shares were valued using the comparable company method with option pricing model to help determine the illiquidity discount.

截至2011年12月31日止年度，本集團就本公司授予現任僱員和前僱員、高級僱員及業務合夥人的股份分別確認人民幣13,468,000元（附註29）和人民幣 14,057,000元（附註26）的費用。

T h e G r o u p r e c o g n i s e d a n e x p e n s e o f RMB13,468,000 (Note 29), RMB14,057,000 (Note 26) for the year ended 31 December 2011 in relation to shares awarded by the Company to the current employees and former employees, officers and business partners, respectively.

截至2012年12月31日止年度，本集團就本公司授予現任僱員的股份確認人民幣36,697,000元（附註29）的費用。

For the year ended 31 December 2012, the Group recognised an expense of RMB36,697,000 (Note 29) in relation to the shares awarded by the Company to the current employees.

F-86

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-87 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

20 本公司權益持有人應佔的其他儲備 20 OTHER RESERVES ATTRIBUTABLE TO EqUITY HOLDERS OF THE COMPANY

本集團

Group

		股份溢價	其他儲備	保留盈利	合計
		Share	Other	Retained
		premium	reserves	earnings	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
				（附註(a)）
				(note (a))
於2012年1月1日的結餘	Balance at 1 January 2012	360,020	(214,198)	3,030,528	3,176,350
全面收益	comprehensive income
年內利潤其他全面收益	Profit for the year Other comprehensive income	– –	– –	930,819 –	930,819 –
年內全面收益總額	Total comprehensive
	income for the year	–	–	930,819	930,819
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
	(Note 18)	1,602,620	–	–	1,602,620
首次公開發售前股份	Pre-IPO share award scheme
獎勵計劃（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee services	–	36,697	–	36,697
擁有人出資及分派總額	Total contributions by and
	distributions to owners	1,602,620	36,697	–	1,639,317
於2012年12月31日的結餘Balance at 31 December 2012		1,962,640	(177,501)	3,961,347	5,746,486
代表：	Representing:
建議末期股息（附註(b)）	Proposed final dividend (Note (b))	283,400			283,400
其他	Others	1,679,240			5,463,086
		1,962,640			5,746,486
於2011年1月1日的結餘	Balance at 1 January 2011	–	118,326	2,143,642	2,261,968
全面收益	comprehensive income
年內利潤	Profit for the year	–	–	886,886	886,886
其他全面收益	Other comprehensive income	–	–	–	–
年內全面收益總額	Total comprehensive income
	for the year	–	–	886,886	886,886
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
	(Note 18)	360,020	(360,049)	–	(29)
首次公開發售前股份	Pre-IPO share award scheme
獎勵計劃（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee
	services	–	13,468	–	13,468
－前僱員、高級僱員	– value of former employees,
及業務合夥人	officers and business
服務價值	partners services	–	14,057	–	14,057
擁有人出資及分派總額	Total contributions by and
	distributions to owners	360,020	(332,524)	–	27,496
於2011年12月31日的結餘Balance at 31 December 2011		360,020	(214,198)	3,030,528	3,176,350

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-87

– F-88 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

20 本公司權益持有人應佔的其他儲備（續） 20 OTHER RESERVES ATTRIBUTABLE TO EqUITY HOLDERS OF THE COMPANY (Cont’d)

本公司

company

		股份溢價	其他儲備	累計虧損	合計
		Share	Other	Accumulated
		premium	reserves	losses	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
				（附註(a)）
				(note (a))
於2012年1月1日的結餘	Balance at 1 January 2012	360,020	27,525	(3,215)	384,330
全面虧損年內虧損其他全面虧損	comprehensive loss Loss for the year Other comprehensive loss	– –	– –	(4,058) –	(4,058) –
年內全面虧損總額	Total comprehensive loss for the year	–	–	(4,058)	(4,058)
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
首次公開發售前股份	(Note 18) Pre-IPO share award scheme	1,602,620	–	–	1,602,620
獎勵計劃（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee services	–	36,697	–	36,697
擁有人出資及分派總額	Total contributions by and distributions to owners	1,602,620	36,697	–	1,639,317
於2012年12月31日的結餘Balance at 31 December 2012		1,962,640	64,222	(7,273)	2,019,589
代表：建議末期股息（附註(b)）其他	Representing: Proposed final dividend (note (b)) Others	283,400 1,679,240			283,400 1,736,189
		1,962,640			2,019,589
於2011年1月1日的結餘	Balance at 1 January 2011	–	360,049	(81)	359,968
全面虧損	comprehensive loss
年內虧損	Loss for the year	–	–	(3,134)	(3,134)
其他全面虧損	Other comprehensive loss	–	–	–	–
年內全面虧損總額	Total comprehensive loss
	for the year	–	–	(3,134)	(3,134)
與擁有人進行的交易	Transactions with owners
發行普通股（附註18）	Issuance of ordinary shares
	(Note 18)	360,020	(360,049)	–	(29)
首次公開發售前股份	Pre-IPO share award scheme
獎勵計劃（附註19）	(Note 19)
－現任僱員服務價值	– value of current employee
	services	–	13,468	–	13,468
－前僱員、高級僱員	– value of former
及業務合夥人	employees, officers and
服務價值	business partners services	–	14,057	–	14,057
擁有人出資及分派總額	Total contributions by and
	distributions to owners	360,020	(332,524)	–	27,496
於2011年12月31日的結餘Balance at 31 December 2011		360,020	27,525	(3,215)	384,330

F-88 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-89 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

20 本公司權益持有人應佔的其他儲備（續）

附註：

20 OTHER RESERVES ATTRIBUTABLE TO EqUITY HOLDERS OF THE COMPANY (Cont’d)

Notes:

(a) 根據中國公司法與本公司中國子公司的組織章程細則，這些子公司每年須將其法定利潤（經抵銷任何過往年度虧損後）的10%撥入法定盈餘公積金（「公積金」）賬戶。當公積金結餘達到這些子公司註冊資本╱股本的50%後，則可選擇是否進一步轉撥公積金。公積金可用於抵銷過往年度虧損或增加繳足資本。然而，在作該等用途後，有關公積金須不少於註冊資本╱股本的25%。
(a) In accordance with the Company Law of the PRC and the articles of association of the PRC subsidiaries, these subsidiaries registered in the PRC shall appropriate 10% of its annual statutory profit (after offsetting any prior years’ losses) to the statutory surplus reserve (“SSR”) account. When the balance of SSR reaches 50% of the registered capital/share capital of these subsidiaries, any further appropriation is optional. The SSR can be utilised to offset prior years’ losses or to increase paid-in capital. However, SSR shall be maintained at a minimum of 25% of registered capital/share capital after such utilisation.

除清盤外，公積金不可用作分派現金股息，並受到若干相關中國法規所限制。

The SSR are non-distributable for cash dividends except in the event of liquidation and are subject to certain restrictions set out in the relevant PRC regulations.

於2012年12月31日，這些子公司的歸屬於本公司擁有人的公積金總額達人民幣921,259,000元（2011年：人民幣873,707,000 元）。這些金額計入本集團的保留盈利。

As at 31 December 2012, total SSR of these subsidiaries attributable to owners of the Company amounted to RMB921,259,000 (2011: RMB873,707,000). These amounts were included in retained earnings of the Group.

(b) 根據開曼群島公司法（2003年修訂版）第34條及本公司的組織章程細則，如本公司具備償還能力且本公司組織章程細則有所規定，則可以本公司的股份溢價向股東作出分派。有關建議末期股息的詳情載列於附註32。
(b) Pursuant to Section 34 of the Cayman Companies Law (2003 Revision) and the Articles of Association of the Company, share premium of the Company is available for distribution to shareholders subject to a solvency test on the Company and the provision of the Articles of Association of the Company. Details of the proposed final dividend are set out in Note 32.

F-89

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-90 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

21 借款 21 BORROWINGS

本集團 Group

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
非即期、有抵押及向以下機構借入：Non-current, secured and borrowed from:
－銀行(a)	– Banks (a)	6,242,070		6,128,900
－信託融資安排	– Trust financing arrangements
－傳統貸款(b)	– conventional loan (b)	1,875,460		2,137,200
－附有購回權益的義務(b)	– equity with repurchase obligation (b)	–		1,467,163
		8,117,530		9,733,263
減：長期借款的即期部份	Less: Current portion of long-term borrowings	(3,607,860)	(3,084,063)
		4,509,670		6,649,200
即期、有抵押及向以下機構借入：	Current, secured and borrowed from:
－銀行(a)	– Banks (a)	1,210,716		384,000
－信託融資安排	– Trust financing arrangements
－傳統貸款(b)	– conventional loan (b)	311,860		319,300
－附有購回權益的義務(b)	– equity with repurchase obligation (b)	–		430,000
加：長期借款的即期部份	Add: Current portion of long-term borrowings	3,607,860		3,084,063
		5,130,436		4,217,363

F-90 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-91 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

21 借款（續）

(a) 本集團的銀行借款由將予開發的租賃土地、在建物業、完工待售物業（附註14）、投資物業（附註8）、子公司股份（附註38）和銀行存款（附註17）抵押或由本公司的子公司相互或由王先生（附註37）擔保。

21 BORROWINGS (Cont’d)

(a) The Group’s bank borrowings are secured by leasehold land to be developed, properties under development, properties held for sale (Note 14), investment properties (Note 8), shares of subsidiaries (Note 38) and bank deposits (Note 17) of the Group or guaranteed by subsidiaries of the Company for each other or by Mr. Wang (Note 37).
(b) 該等借款主要與信託公司以信託融資安排形式訂立。傳統貸款信託融資安排是本集團與信託公司訂立的貸款協議。附有購回權益義務的信託融資安排涉及附有購回權益義務的項目公司股本擴大或轉讓股權。這種信託融資安排的實質是借款，並以合法轉讓的項目公司的股權作為抵押品。信託融資安排項下的借款由若干完工待售或在建銷售物業（附註 14）和本集團子公司的股份（附註38）抵押或由王先生（附註37）擔保。
(b) These borrowings are mainly in the form of trust financing arrangements with trust financing companies. The conventional loan trust financing arrangements are loan agreements entered into by the Group and trust financing companies. The equity with repurchase obligation trust financing arrangements involves either capital increase in, or transfer of equity interest in project companies with repurchase obligation. The substance of the type of trust financing arrangement is borrowing, with the equity interest in the project companies legally transferred as collateral. The borrowings under trust financing arrangements are secured by certain properties held or under development for sale (Note 14) and shares of subsidiaries of the Group (Note 38) or guaranteed by Mr. Wang (Note 37).

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-91

– F-92 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

21 借款（續）

下表載列附有購回權益義務的信託融資安排於2012 年及2011年12月31日的詳情：

21 BORROWINGS (Cont’d)

The following table sets out details of the equity with repurchase obligation trust financing arrangements as at 31 December 2012 and 2011:

		於12月31日	於12月31日	於12月31日	到期日
		As at 31	December		Expiration date
		2012年		2011年
		2012		2011
		人民幣千元		人民幣千元
		RMB’000		RMB’000
上海新城創宏房地產	Shanghai Future Land Chuanghong				2012年7月11日
有限公司	Real Estate Co., Ltd.	–		350,000	11 July 2012
常州新城宏業房地產	Changzhou Future Land Hongye Real				2012年7月26日
有限公司	Estate Co., Ltd.	–		400,000	26 July 2012
常州新城創佳房地產開發	Changzhou Future Land Chuangjia				2012年10月23日
有限公司	Real Estate Co., Ltd	–		430,000	23 October 2012
常州新城萬佳房地產開發	Changzhou Future Land Wanjia Real				2012年10月25日
有限公司	Estate Co., Ltd.	–		150,000	25 October 2012
南京新城萬嘉房地產	Nanjing Future Land Wanjia Real				2012年11月30日
有限公司	Estate Co., Ltd.	–		150,000	30 November 2012
上海新城金郡房地產	Shanghai Future Land Jinjun Real				2012年12月26日
有限公司	Estate Co., Ltd.	–		453,000	26 December 2012
減：交易成本和預付	Less: Transaction costs and prepaid	–		1,933,000
利息開支	interest expenses	–		(35,837)
		–		1,897,163

截至2012年12月31日，本集團在到期前償還了所有信託融資項下附有購回權益義務的借款，並終止了所有此等安排。

As of 31 December 2012, the Group had repaid all borrowings under the trust financing arrangements with repurchase obligation before their expiration and terminated all such arrangements.

F-92

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-93 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

21 借款（續）

於2012年及2011年12月31日，非流動借款的到期情況列示如下：

21 BORROWINGS (Cont’d)

The maturity of non-current borrowings as at 31 December 2012 and 2011 are as follows:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一至兩年	Between 1 and 2 years	2,700,670		3,671,200
二至五年	Between 2 and 5 years	1,359,000		2,978,000
超過五年	Over 5 years	450,000		–
		4,509,670		6,649,200

於2012年和2011年12月31日，加權平均實際利率列示如下：

The weighted average effective interest rates as at 31 December 2012 and 2011 were as follows:

		於12月31日	於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元		人民幣千元
		RMB’000		RMB’000
銀行借款	Bank borrowings	6.76%		6.69%
信託融資安排	Trust financing arrangements	13.50%		13.28%

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-93

– F-94 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

21 借款（續）

本集團借款的利率變動風險及合同重新定價日或到期日（以較早者為準）如下：

21 BORROWINGS (Cont’d)

The exposure of the Group’s borrowings to interest rate changes and the contractual repricing dates or maturity whichever is the earlier date is as follows:

		六個月或以內	六至十二個月	一至五年	超過五年	合計
		6 months	6-12		Over
		or less	months	1-5 years	5 years	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
計入非流動負債的借款：	Borrowings included in non-current
	liabilities:
於2012年12月31日	As at 31 December 2012	1,785,600	1,209,370	1,514,700	–	4,509,670
於2011年12月31日	As at 31 December 2011	2,284,000	893,000	3,472,200	–	6,649,200
計入流動負債的借款：	Borrowings included in current liabilities:
於2012年12月31日	As at 31 December 2012	5,040,436	90,000	–	–	5,130,436
於2011年12月31日	As at 31 December 2011	3,701,363	516,000	–	–	4,217,363

本集團借款的賬面值以人民幣計值，並與其公允價值相若。

The carrying values of the borrowings of the Group are denominated in RMB and approximate their fair value.

22 預售物業預收款項

本集團

本集團在物業竣工及可供交付前開始銷售物業並向客戶收取款項。這些向客戶收取的款項在相關銷售確認前列作預售物業預收款項。

22 ADVANCES FROM PRE-SALE OF PROPERTIES

Group

The Group starts sales of properties and collection of proceeds from customers before the properties are completed and ready for delivery. Such proceeds from customers are recorded as advances from pre-sale of properties before relevant sales are recognised.

F-94

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-95 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

23 貿易和其他應付款項 23 TRADE AND OTHER PAYABLES

本集團		Group
			於12月31日
			as at 31	December
			2012年		2011年
			2012		2011
			人民幣千元	人民幣千元
			RmB’000		RMB’000
貿易應付款項	Trade payables		8,223,769		5,950,825
應付票據	Notes payable		637,748		39,121
應付關連方款項（附註37）	Payables to related parties (Notes	37)	–		4,404
營業稅和其他應付稅項	Business and other taxes payable		208,460		200,458
代收保養及裝修費	Maintenance & decoration fees collected on behalf		122,198		78,958
代收契稅	Deed tax collected on behalf		127,673		78,311
應計工資	Accrued payroll		71,912		62,816
應付利息	Interest payable		125,396		132,941
應還臨時借用資金(a)	Temporary funding payables (a)		18,000		18,000
其他	Others		61,873		61,255
			9,597,029		6,627,089

(a) 應還臨時借用資金均為應付非關聯方款項，不計息且無抵押。

(a) Temporary funding payables are payables to non-related parties which are non-interest bearing and unsecured.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-95

– F-96 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

23 貿易和其他應付款項（續）

於2012年和2011年12月31日，貿易應付款項及應付票據的賬齡分析如下：

23 TRADE AND OTHER PAYABLES (Cont’d)

The aging analysis of trade payables and notes payable as at 31 December 2012 and 2011 are as follows:

		於12月31日	於12月31日
		as at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RmB’000		RMB’000
一年內	Less than 1 year	8,694,356		5,858,384
一至二年	Between 1 and 2 years	120,120		88,784
二至三年	Between 2 and 3 years	27,644		25,671
三年以上	Over 3 years	19,397		17,107
		8,861,517		5,989,946

於2012年和2011年12月31日，貿易和其他應付款項的公允價值與其賬面值相若。

As 31 December 2012 and 2011, the fair value of trade and other payables approximate their carrying amounts.

於2012年和2011年12月31日，貿易和其他應付款項的賬面值主要以人民幣計值。

As at 31 December 2012 and 2011, the carrying amounts of trade and other payables are primarily denominated in RMB.

本公司

Company

		於12月31日	於12月31日
		as at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RmB’000		RMB’000
應付專業費用	Professional fees payable	13,789		–
應付關連方款項（附註37）	Payables to related parties (Notes 37)	–		4,404
		13,789		4,404

於2012年及2011年12月31日，貿易和其他應付款項賬齡全部少於1年。

於2012年和2011年12月31日，貿易和其他應付款項的公允價值與其賬面值相若。

The aging of trade and other payables as at 31 December 2012 and 2011 are all less than 1 year.

As 31 December 2012 and 2011, the fair value of trade and other payables approximate their carrying amounts.

於2012年和2011年12月31日，貿易和其他應付款項的賬面值均以港元計值。

As at 31 December 2012 and 2011, the carrying amounts of trade and other payables are all denominated in HKD.

F-96

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-97 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

24 遞延所得稅

本集團

24 DEFERRED INCOME TAx

Group

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
將可動用的遞延稅項資產	Deferred tax assets to be recovered
－十二個月內	– within 12 months	19,234		89,797
－十二個月後	– after 12 months	341,959		272,843
		361,193		362,640
將予結清的遞延稅項負債	Deferred tax liabilities to be settled
－十二個月內	– within 12 months	(22,120)		(13,898)
－十二個月後	– after 12 months	(380,752)		(329,339)
		(402,872)		(343,237)
遞延稅項（負債）╱資產淨額	Deferred tax (liabilities)/assets, net	(41,679)		19,403

遞延所得稅賬目的變動列示如下：

The movement on the deferred income tax account is as follows:

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
年初	At beginning of year	19,403 (52,236)
（支銷）╱貸記合併利潤表	(Charged)/credited to the consolidated
（附註30）	statement of income (Note 30)	(61,082) 71,639
年末	At end of year	(41,679) 19,403

於2012年12月31日，人民幣47,423,000元的遞延所得稅資產和遞延所得稅負債已相互抵銷（2011年：人民幣23,230,000元）。

As at 31 December 2012, deferred income tax assets and deferred income tax liabilities amounted to RMB47,423,000 were offset (2011: RMB23,230,000).

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-97

– F-98 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

24 遞延所得稅（續）

於截至2012年及2011年12月31日止年度，遞延所得稅資產和負債的原額變動（未經考慮抵銷同一稅務司法權區內的結餘）列示如下：

24 DEFERRED INCOME TAx (Cont’d)

The gross movements in deferred income tax assets and liabilities for the years ended 31 December 2012 and 2011, without taking into consideration the offsetting of balances within the same tax jurisdiction, are as follows:

遞延所得稅資產

Deferred income tax assets

			完工待售			對銷
		稅務虧損	物業撥備	應計費用	土地增值稅	公司間交易	合計
			Provisions for		Land	Elimination of
			properties		appreciation	inter-company
		Tax losses	held for sale	Accruals	tax	transactions	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
於2012年1月1日	At 1 January 2012	150,744	120,600	14,450	98,384	1,692	385,870
貸記╱（支銷）合併利潤表	Credited/(charged) to the consolidated
	statement of income	17,058	(33,247)	(9,860)	49,562	(767)	22,746
於2012年12月31日	At 31 December 2012	167,802	87,353	4,590	147,946	925	408,616
於2011年1月1日	At 1 January 2011	88,498	23,938	5,857	86,873	1,730	206,896
貸記╱（支銷）合併利潤表	Credited/(charged) to the consolidated
	statement of income	62,246	96,662	8,593	11,511	(38)	178,974
於2011年12月31日	At 31 December 2011	150,744	120,600	14,450	98,384	1,692	385,870

根據中國法律和法規，稅務虧損可結轉五年以抵銷未來應課稅利潤。倘若有充足應課稅利潤可供遞延稅項資產動用，則確認此等未動用稅務虧損的遞延稅項資產。

In accordance with the PRC laws and regulations, tax losses could be carried forward for a period of five years to offset against its future taxable profits. Deferred tax assets relating to unutilised tax losses are recognised to the extent that it is probable that sufficient taxable profit will be available to allow such deferred tax assets to be utilised.

本集團並未就於2012年12月31日金額為人民幣 403,407,000元（2011年：人民幣312,028,000 元）的稅務虧損確認相應的遞延所得稅資產人民幣 100,852,000元（2011年：人民幣78,007,000元）。所有這些稅務虧損將於五年內到期。

The Group did not recognise deferred income tax assets of RMB100,852,000 (2011: RMB78,007,000) i n r e s p e c t o f t a x l o s s e s a m o u n t i n g t o RMB403,407,000 as at 31 December 2012 (2011: RMB312,028,000). All these tax losses will expire within five years.

F-98 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-99 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

24 遞延所得稅（續）遞延所得稅負債

24 DEFERRED INCOME TAx (Cont’d) Deferred income tax liabilities

		投資物業		對銷公司間
		公允價值		交易成本	車庫成本	中國子公司的
		收益	收購子公司	分配差異	分攤差異	未分配利潤	合計
		Fair value
		gains on		Elimination of	carpark cost	Undistributed
		investment	Acquisition of	inter-company	allocation	profits of PRc
		properties	subsidiaries	transactions	differences	subsidiaries	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
						（附註(a)）
						(note (a))
於2012年1月1日	At 1 January 2012	275,221	6,432	7,465	77,349	–	366,467
支銷╱（貸記）合併利潤表	Charged/(credited) to the consolidated
	statement of income	7,772	(3,312)	(1,102)	67,833	12,637	83,828
於2012年12月31日	At 31 December 2012	282,993	3,120	6,363	145,182	12,637	450,295
於2011年1月1日	At 1 January 2011	206,848	11,134	9,723	31,427	–	259,132
支銷╱（貸記）合併利潤表	Charged/(credited) to the consolidated
	statement of income	68,373	(4,702)	(2,258)	45,922	–	107,335
於2011年12月31日	At 31 December 2011	275,221	6,432	7,465	77,349	–	366,467

(a) 於2012年12月31日，本集團已就中國境外投資者應佔若干中國子公司部份未匯出可供分配利潤在匯出時應支付的預扣稅確認遞延所得稅負債人民幣12,637,000元（2011年：零）。

(a) As at 31 December 2012, deferred income tax liabilities of RMB12,637,000 (2011: nil) have been recognised for the withholding tax that would be payable upon remittance, in respect of a portion of the unremitted distributable profits of certain PRC subsidiaries attributable to the investors outside PRC.

於2012年12月31日，本集團未就中國境外投資者應佔若干中國子公司為數人民幣2,470,027,000元（2011年：人民幣 1,891,520,000元）的未匯出可分派溢利在匯出時應支付的預扣稅確認相關的遞延所得稅負債人民幣123,501,000元（2011年：人民幣 189,152,000元），這乃由於該等利潤擬作為再投資。

As at 31 December 2012, deferred income tax liabilities of RMB123,501,000 (2011: RMB189,152,000) have not been recognised for the withholding tax that would be payable upon remittance, in respect of the unremitted distributable p ro f i t s o f c e r t a i n P R C s u b s i d i a r i e s attributable to the investors outside PRC amounting to RMB2,470,027,000 (2011: RMB1,891,520,000) as such profits are intended to be reinvested.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-99

– F-100 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

25 收入

截至2012年及2011年12月31日止年度，本集團的營業額包括以下各項收入：

25 REVENUE

Turnover of the Group consists of the following revenues for the years ended 31 December 2012 and 2011:

		截至12月31日止年度
		Year ended 31 December
		2012年 2011年
		2012 2011
		人民幣千元人民幣千元
		RMB’000 RMB’000
銷售物業收入	Revenue from sales of properties	17,341,932 10,688,562
物業管理收入	Revenue from property management	121,469 72,088
租金收入	Rental income	35,620 4,960
其他	Others	18,245 1,644
		17,517,266 10,767,254

F-100

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-101 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

26 其他收入╱其他開支╱其他收益－淨額

26 OTHER INCOME/OTHER ExPENSES/ OTHER GAINS – NET

截至12月31日止年度 Year ended 31 December

		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
其他收入	Other income
政府補貼	Government grants	4,433 –
歸還土地使用權獲得之補償	Compensation for return of land use rights	– 5,743
可供出售金融資產股息收入	Dividend income on available-for-sale financial
	assets	5,042 3,750
訴訟勝訴獲得之賠償(a)	Compensation received from a lawsuit (a)	– 30,000
		9,475 39,493
其他開支	Other expenses
捐贈	Donations	(4,347) (6,183)
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註19）	(Note 19)
－前任僱員、主管人員及業務夥伴	– value of former employees, officers and
服務價值	business partners services	– (14,057)
		(4,347) (20,240)
其他收益－淨額	Other gains – net
出售投資物業產生的收益	Gain from disposal of an investment property	– 750
出售物業、廠房和設備產生的虧損	Losses from disposal of property, plant and
	equipment	(55) (40)
出售可供出售金融資產產生的收益	Gains from disposal of available-for-sale financial
（附註11）	assets (Note 11)	– 50,266
取消物業銷售合約獲得之賠償	Compensation for cancellation of property
	sales contracts	13,686 7,775
其他	Others	(5) (675)
		13,626 58,076

(a) 於2011年12月9日，一項訴訟透過法律裁決解決，據此，一家違反與本集團於2007年簽訂合作協議的實體須向本集團支付賠償人民幣30,000,000元。該賠償已於2011年12月收到。

(a) On 9 December 2011, a lawsuit was settled through a legal judgment, according to which, an entity which breached a cooperative agreement signed in 2007 with the Group was judged to pay a compensation of RMB30,000,000 to the Group. This compensation was received in December 2011.

F-101

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-102 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

27 按性質劃分的開支

計入銷售成本、銷售和營銷成本及行政開支的開支分析如下：

27 ExPENSES BY NATURE

Expenses included in cost of sales, selling and marketing costs and administrative expenses are analysed as follows:

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
土地使用權成本	Land use rights costs	4,025,794 1,634,569
建設成本	Construction costs	7,684,444 4,640,411
資本化利息	Capitalised interest	732,328 398,288
營業稅及附加費(a)	Business tax and surcharges (a)	977,980 600,515
完工待售物業減值撥備	Accrual of provision for properties
	held for sale	– 398,726
物業、廠房和設備折舊	Depreciation of property, plant and equipment
（附註7）	(Note 7)	19,977 16,650
無形資產攤銷（附註9）	Amortisation of intangible assets (Note 9)	1,531 1,292
銀行手續費	Bank charges	9,304 16,914
員工成本（附註29）	Staff costs (Note 29)	478,739 326,509
招待費	Entertainment expenses	68,393 69,234
印花稅及其他稅項	Stamp duty and other taxes	31,739 27,729
專業費用	Professional fees	32,436 18,983
核數師酬金	Auditors’ remuneration	3,280 4,250
應付核數師的非核數服務費	Non-audit service fees to the auditors	237 636
銷售佣金	Sales commission	185,620 123,881
廣告及宣傳費用	Advertising and publicity costs	229,603 228,741
租賃開支	Rental expenses	21,897 20,386
差旅費用	Travelling expenses	9,451 9,339
其他開支	Other expenses	119,422 60,666
銷售成本、銷售和營銷成本及	Total cost of sales, selling and marketing costs and
行政開支總計	administrative expenses	14,632,175 8,597,719

(a) 本集團的中國子公司須就其銷售物業收入和租金收入繳納5%的營業稅，而附加費則按應付營業稅的10%至12%繳納。

(a) The PRC subsidiaries of the Group are subject to business tax and surcharges. Business tax is levied at 5% of revenue from sale of properties and rental income, while surcharges are 10% to 12% of business tax payable.

F-102

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-103 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

28 融資成本－淨額

28 FINANCE COSTS – NET

截至12月31日止年度 Year ended 31 December

		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
融資成本	Finance costs
－銀行貸款和信託融資安排	– Interest on bank loans and trust financing
的利息	arrangements	(1,015,746) (1,025,987)
－減：資本化利息	– Less: Interest capitalised
（附註8及附註14）	(Note 8 and Note 14)	856,034 871,439
融資成本總額（附註34）	Total finance costs (Note 34)	(159,712) (154,548)
財務收入	Finance income
－銀行存款的利息收入（附註34）– Interest income on bank deposits (Note 34)		48,052 19,406
融資成本淨額	Net finance costs	(111,660) (135,142)

29 員工成本（包含董事酬金）

29 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS)

		截至12月31日止年度
		Year ended 31 December
		2012年 2011年
		2012 2011
		人民幣千元人民幣千元
		RMB’000 RMB’000
工資和薪金	Wages and salaries	360,519 267,606
退休金	Pension	30,776 21,898
其他福利開支	Other welfare benefit expenses	50,747 23,537
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
－現任僱員價值（附註19）	– value of current employees (Note 19)	36,697 13,468
支銷合併利潤表（附註27）	Charged to consolidated statement
	of income (Note 27)	478,739 326,509
僱員數目	Number of employees	4,127 3,384

本集團的所有中國僱員參加由政府機構設立及管理的定額供款僱員社會保險計劃，包括退休、醫療、住房及其他福利計劃。本集團並無其他重大職工福利承諾。

All Chinese employees of the Group participate in defined contribution employee social security plans, including pension, medical, housing and other welfare benefits, organised and administered by the governmental authorities. The Group has no other substantial commitments to employees.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-103

– F-104 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

29 員工成本（包含董事酬金）（續）

根據有關規定，本集團按工資總額的一定比例且在不超過規定上限的基礎上提取保險費及公積金，並向勞動和社會保障機構繳納。

29 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS) (Cont’d)

According to the relevant regulations, the premiums and welfare benefit contributions that should be borne by the Group are calculated based on percentages of the total salary of employees, subject to a certain ceiling, and are paid to the labour and social welfare authorities.

(a) 董事及主要行政人員的酬金

董事及主要行政人員的酬金列示如下：

(a) Directors’ and chief executive’s emoluments

The directors’ and chief executive’s emoluments are set out below:

袍金姓名 Name of director Fees	薪金及其他津貼 Salaries and other allowances 人民幣千元 RMB’000	績效紅利 Performance related bonus 人民幣千元 RMB’000	退休計劃供款 Retirement scheme contributions 人民幣千元 RMB’000	首次公開發售前股份獎勵計劃 Pre-IPO share award scheme 人民幣千元 RMB’000	合計 Total 人民幣千元 RMB’000
截至2012年12月31日止年度：Year ended 31 December 2012 王先生(i) Mr. Wang (i) – 譚為民 Tan Weimin – 閔遠松 Min Yuansong – 劉源滿 Liu Yuanman – 呂小平 Lv Xiaoping – 黃茂莉 Huang Maoli – 聶梅生(ii) Nie Meisheng (ii) 23 陳華康(ii) Chen Huakang (ii) 23 朱增進(ii) Zhu Zengjin (ii) 23
	1,784	1,200	16	–	3,000
	507	960	33	1,148	2,648
	944	1,140	16	1,837	3,937
	704	780	16	1,148	2,648
	1,424	960	16	2,756	5,156
	1,080	–	–	–	1,080
	–	–	–	–	23
	–	–	–	–	23
	–	–	–	–	23

69	6,443	5,040	97	6,889	18,538

截至2011年12月31日止年度：Year ended 31 December 2011 王先生(i) Mr. Wang (i) – 譚為民 Tan Weimin – 閔遠松 Min Yuansong – 劉源滿 Liu Yuanman – 呂小平 Lv Xiaoping –	1,795 529 955 715 1,435	1,200 960 1,140 780 960	5 11 5 5 5	– 421 674 421 1,011	3,000 1,921 2,774 1,921 3,411 13,027
–	5,429	5,040	31	2,527

(i) 本公司的主要行政人員為王先生，其亦為本公司其中一名董事。 (ii) 聶梅生、陳華康及朱增進於2012年 11月獲委任為本公司獨立非執行董事。

(i) The chief executive of the Company is Mr. Wang, who is also one of the directors of the Company.

(ii) Nie Meisheng, Chen Huakang and Zhu Zengjin were appointed as independent non-executive directors of the Company in November 2012.

F-104

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-105 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

29 員工成本（包含董事酬金）（續）

(b) 五名最高薪人士

截至2012年12月31日止年度，本集團年內五名最高薪酬人士包括三名（2011年：三名）董事，彼等之酬金已於上文呈列的分析中反映。截至2012年12月31日止年度內應付予餘下兩名（2011年：兩名）人士的薪酬如下：

29 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS) (Cont’d)

(b) Five highest paid individuals

The five individuals whose emoluments were the highest in the Group during the year ended 31 December 2012 include three (2011: three) directors whose emoluments are reflected in the analysis presented above. The emoluments payable to the remaining two (2011: two) individuals for the year ended 31 December 2012 are as follows:

截至12月31日止年度 Year ended 31 December

		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
基本薪金、房屋津貼、首次公開	Basic salaries, housing allowances, Pre-IPO share
發售前股份獎勵計劃、其他津貼	award scheme, other allowances and benefits
和實物福利	in kind	5,625 3,370
花紅	Bonuses	760 1,180
		6,385 4,550

該兩名人士之酬金範圍如下：

The emoluments to the two individuals fell within the following bands:

截至12月31日止年度

Year ended 31 December

Year ended	31 December
2012年 2012	2011年 2011
酬金範圍 Emoluments bands 2,000,001港元－2,500,000港元 HKD2,000,001 – HKD2,500,000 – 2,500,001港元－3,000,000港元 HKD2,500,001 – HKD3,000,000 – 3,000,001港元－3,500,000港元 HKD3,000,001 – HKD3,500,000 – 3,500,001港元－4,000,000港元 HKD3,500,001 – HKD4,000,000 1 4,000,001港元－4,500,000港元 HKD4,000,001 – HKD4,500,000 1	1 1 – – –

(c) 截至2012年及2011年12月31日止年度，概無董事或任何五名最高薪人士向本集團收取任何酬金作為加盟或在加盟或離開本集團時的獎勵或補償或作為離職補償。

(c) During the years ended 31 December 2012 and 2011, no director or any of the five highest paid individuals received any emolument from the Group as an inducement to join, upon joining the Group, leave the Group or as compensation for loss of office.

F-105

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-106 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

30 所得稅開支

30 INCOME TAx ExPENSE

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
當期所得稅	Current income tax
－中國土地增值稅	– PRC land appreciation tax	636,150 388,216
－中國企業所得稅	– PRC corporate income tax	535,545 624,707
遞延所得稅（附註24）	Deferred income tax (Note 24)	1,171,695 1,012,923 61,082 (71,639)
年內列支的所得稅總額	Total income tax charged for the year	1,232,777 941,284

本集團除所得稅前利潤的所得稅有別於使用本集團旗下各公司所在國頒佈的稅率計算的理論金額，茲載列如下：

The income tax on the Group’s profit before income tax differs from the theoretical amount that would arise using the enacted tax rate of the home country of the companies within the Group as follows:

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
除所得稅前利潤	Profit before income tax	2,818,161 2,385,215
中國土地增值稅	PRC land appreciation tax	(636,150) (388,216)
按25%法定稅率計算的所得稅	Income tax calculated at statutory rate of 25%	2,182,011 1,996,999 545,503 499,250
不可扣減開支	Non-deductible expenses	17,734 22,096
非課稅收入	Non-taxable income	(1,260) (938)
未確認為遞延所得稅資產的稅務虧損Tax losses not recognised as deferred tax assets		22,845 32,660
過往年度稅項調整	Prior year tax adjustments	(832) –
中國預扣稅	PRC withholding tax	12,637 –
中國土地增值稅	PRC land appreciation tax	636,150 388,216
所得稅開支總額	Total income tax expense	1,232,777 941,284

F-106

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-107 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

30 所得稅開支（續）

中國企業所得稅

根據中國企業所得稅法（「企業所得稅法」），本集團旗下於中國內地的子公司適用的企業所得稅率為 25%。

30 INCOME TAx ExPENSE (Cont’d)

PRc corporate income tax

Under the Corporate Income Tax Law of the PRC (“CIT Law”), the CIT rate applicable to the Group’s subsidiaries located in mainland China is 25%.

企業所得稅法及其實施細則規定中國居民企業就 2008年1月1日起產生的盈利向其中國以外的直接控股公司派發的股息須繳納10%的預扣稅，而於2008 年1月1日前產生的未分派盈利則獲豁免繳納該預扣稅。根據中國與香港訂立的稅務協約安排，若直接控股公司成立於香港，可應用較低的5%預扣稅稅率。截至2012年12月31日止年度，本集團就其中國實體產生的部分盈利按5%的稅率計提遞延所得稅撥備人民幣12,637,000元（2011年：零元）。本集團能控制該等中國子公司的股息政策並已確定將不會於可見未來分派該等子公司的大部分盈利。

The CIT Law and its implementation rules impose a withholding tax at 10% for dividends distributed by a PRC-resident enterprise to its immediate holding company outside PRC for earnings generated beginning 1 January 2008 and undistributed earnings generated prior to 1 January 2008 are exempted from such withholding tax. A lower 5% withholding tax rate may be applied when the immediate holding companies are established in Hong Kong according to the tax treaty arrangement between the PRC and Hong Kong. For the year ended 31 December 2012, the Group accrued for PRC withholding tax with amount of RMB12,637,000 (2011: nil) based on the tax rate of 5% on a portion of the earnings generated by its PRC entities. The Group controls the dividend policies of these subsidiaries and it has been determined that it is probable that a majority of these earnings will not be distributed in the foreseeable future.

土地增值稅

中國土地增值稅以銷售物業所得款項減去可扣減開支（包括土地使用權租賃費用及所有物業開發開支）的土地增值按介乎30%至60%的累進稅率徵收，並於合併利潤表內列作所得稅開支。

Land appreciation tax

PRC land appreciation tax is levied at progressive rates ranging from 30% to 60% on the appreciation of land value, being the proceeds from sales of properties less deductible expenditures including lease charges for land use rights and all property development expenditures, and is included in the consolidated statement of income as income tax expense.

F-107

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-108 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts 截至2012年12月31日止年度 For the year ended 31 December 2012

31 每股盈利

每股基本盈利乃按本公司權益持有人應佔本集團利潤除以年內已發行普通股加權平均數計算。為釐定2011年內已發行普通股加權平均數，就重組（附註1及附註18）而於2011年9月發行和配發的 4,250,000,000股股份被視為猶如該4,250,000,000 股股份於2011年1月1日起已發行。

31 EARNINGS PER SHARE

Basic earnings per share for the year is calculated by dividing the profit of the Group attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year. In determining the weighted average number of ordinary shares in issue during 2011, the 4,250,000,000 shares, which were issued and allotted in September 2011 in connection with the Reorganisation (Note 1 and Note 18), has been treated as if the 4,250,000,000 shares were in issue since 1 January 2011.

		截至12月31日止年度
		Year ended 31 December
		2012年 2011年
		2012 2011
本公司權益持有人應佔合併利潤	Consolidated profit attributable to equity holders
（人民幣千元）	of the Company (RMB’000)	930,819 886,886
已發行普通股加權平均數（千股）	Weighted average number of ordinary shares
	in issue (’000)	4,368,167 4,250,000
每股基本盈利（人民幣元）	Basic earnings per share (RMB)	0.21 0.21

由於截至年2012及2011年12月31日止年度並無任何攤薄購股權和其他具潛在攤薄效應的已發行股份，故每股攤薄盈利與每股基本盈利相同。

As there were no dilutive options and other dilutive potential shares in issue during the years ended 31 December 2012 and 2011, diluted earnings per share is the same as basic earnings per share.

F-108

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-109 –

合併財務報表附註 Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

32 股息

32 DIVIDENDS

32 股息	32 DIVIDENDS
		截至12月31日止年度
		Year ended 31 December
		2012年	2011年
		2012	2011
		人民幣千元	人民幣千元
		RMB’000	RMB’000
擬派末期股息每股普通股	Proposed final dividend of
人民幣0.05元	RMB0.05 per ordinary share	283,400	–

於2013年3月27日舉行的董事會會議上，董事建議使用股份溢價賬派發2012年度末期股息每股普通股人民幣0.05元。擬派股息並無於本財務報表反映為應付股息，惟待股東於本公司應屆股東週年大會批准後，將反映為截至2013年12月31日止年度的股份溢價賬撥付。

At a Board meeting held on 27 March 2013, the directors proposed a final dividend for 2012 of RMB0.05 per ordinary share using the share premium account. This proposed dividend is not reflected as a dividend payable in these financial statements, but will be reflected as an appropriation of share premium for the year ending 31 December 2013 upon approval by the shareholders at the forthcoming annual general meeting of the Company.

33 本公司擁有人應佔虧損

本公司於2010年4月23日註冊成立。截至2012年12 月31日止年度，本公司擁有人應佔虧損分別為人民幣4,058,000元（2011年：人民幣3,134,000元），已於本公司財務報表中入賬。

33 LOSS ATTRIBUTABLE TO OWNERS OF THE COMPANY

The Company was incorporated on 23 April 2010. The loss attributable to owners of the Company for the year ended 31 December 2012 amounted to RMB4,058,000 (2011: RMB3,134,000), which have been dealt with in the financial statements of the Company.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-109

– F-110 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

34 經營活動所得現金 34 CASH GENERATED FROM OPERATIONS

		截至12月31日止年度
		Year ended 31 December
		2012年 2011年
		2012 2011
		人民幣千元人民幣千元
		RMB’000 RMB’000
除所得稅前利潤	Profit before income tax	2,818,161 2,385,215
就下列各項作出調整：	Adjustments for:
－折舊（附註27）	– Depreciation (Note 27)	19,977 16,650
－攤銷（附註27）	– Amortisation (Note 27)	1,531 1,292
－出售物業、廠房和設備產生的	– Losses on disposal of property, plant and
虧損（附註26）	equipment (Note 26)	55 40
－出售投資物業產生的收益	– Gains from disposal of investment properties
（附註26）	(Note 26)	– (750)
－出售可供出售金融資產產生的	– Gains from disposal of available-for-sale
收益（附註26）	financial assets (Note 26)	– (50,266)
－首次公開發售前股份	– Pre-IPO share award scheme expenses
獎勵計劃支出（附註19）	(Note 19)	36,697 27,525
－投資物業公允價值收益（附註8）– Fair value gains on investment properties
	(Note 8)	(31,086) (273,493)
－持作（或開發中作）銷售物業	– (Reversal)/accrual of provision for properties
減值撥備（轉回）╱計提	held (or under development) for sale
（附註14）	(Note 14)	(132,988) 398,726
－應佔聯營公司業績（附註10）	– Share of results of an associated company
	(Note 10)	5,110 –
－可供出售金融資產股息收入	– Dividend income on available-for-sale
（附註26）	financial assets (Note 26)	(5,042) (3,750)
－融資成本（附註28）	– Finance costs (Note 28)	159,712 154,548
－利息收入（附註28）	– Interest income (Note 28)	(48,052) (19,406)
營運資金變動	Changes in working capital
－用於經營活動的受限制現金	– Restricted cash relating to operating activities
（附註17）	(Note 17)	(603,964) 9,587
－租賃土地預付款項	– Prepayments for leasehold land	(1,624,692) 245,642
－完工待售或在建銷售物業	– Properties held or under development for sale
（不包括資本化利息）	(excluding capitalised interest)	642,330 (6,008,944)
－貿易及其他應收款項及預付款項– Trade and other receivables and prepayments		57,861 (143,874)
－預售物業預收款項	– Advances from pre-sale of properties	(1,111,151) 2,180,925
－貿易和其他應付款項	– Trade and other payables	2,977,485 1,877,747
經營活動所得現金	Cash generated from operations	3,161,944 797,414

F-110 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-111 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

34 經營活動所得現金（續）

於合併現金流量表內，出售物業、廠房和設備的所得款項包括：

34 CASH GENERATED FROM OPERATIONS (Cont’d)

In the consolidated statement of cash flows, proceeds from disposal of property, plant and equipment comprise:

截至12月31日止年度 Year ended 31 December

		截至12月31日止年度 Year ended 31 December
		2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
賬面淨值（附註7）	Net book value (Note 7)	890 4,153
出售物業、廠房和設備產生的虧損	Losses on disposal of property,
（附註26）	plant and equipment (Note 26)	(55) (40)
出售物業、廠房和設備所得款項	Proceeds from disposal of property,
	plant and equipment	835 4,113

35 承擔

(a) 物業開發支出承擔

於2012年及2011年12月31日，尚未發生但已作出承擔的物業開發支出如下：

35 COMMITMENTS

(a) Property development expenditure commitments

As at 31 December 2012 and 2011, property development expenditure committed but not yet incurred are as follows:

		於12月31日	於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元		人民幣千元
		RMB’000		RMB’000
已訂約但未撥備	Contracted but not provided for	8,376,039		6,962,029

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-111

– F-112 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

35 承擔（續）

(b) 經營租賃承擔
於2012年及2011年12月31日，就若干以不可撤銷經營租賃租入的辦公室樓宇而產生的未來最低租金支出總額需於以下期間支付：

35 COMMITMENTS (Cont’d)

(b) Operating lease commitments

As at 31 December 2012 and 2011, the future aggregate minimum rental expenses in respect of certain office buildings held under non-cancellable operating leases are payable in the following periods:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Within 1 year	13,399		9,889
一至五年	1 to 5 years	10,432		13,663
		23,831		23,552

(c) 投資承擔

於2012年及2011年12月31日，投資承擔如下：

(c) Investment commitments

As at 31 December 2012 and 2011, committed investments are as follows:

下：
			於12月31日
			As at 31	December
			2012年		2011年
			2012		2011
			人民幣千元		人民幣千元
			RMB’000		RMB’000
可供出售金融資產的投資承擔	Committed	investments in available-for-sale
	financial	assets	55,000		–

(d) 經營租賃應收租金

於2012年及2011年12月31日，就土地及建築物以不可撤銷經營租賃租出而產生的未來最低租金收款總額將於以下期間獲取：

(d) Operating lease rentals receivable

As at 31 December 2012 and 2011, the future aggregate minimum rental receipts under non-cancellable operating leases in respect of land and buildings are receivable in the following periods:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Within 1 year	54,217		–
一至五年	1 to 5 years	152,780		–
五年後	After 5 years	118,774		–
		325,771		–

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

F-112

– F-113 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

36 財務擔保及或有負債

(a) 按揭融資的擔保

於2012年及2011年12月31日，本集團就按揭融資提供財務擔保產生的或然負債如下：

36 FINANCIAL GUARANTEES AND CONTINGENT LIABILITIES

(a) Guarantees on mortgage facilities

The Group had the following contingent liabilities in respect of financial guarantees on mortgage facilities as at 31 December 2012 and 2011:

		於12月31日	於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
		人民幣千元		人民幣千元
		RMB’000		RMB’000
就本集團物業的若干買家的	Guarantees in respect of mortgage facilities for
按揭融資作出的擔保	certain purchasers of the Group’s properties	3,993,685		3,970,751

本集團已為本集團物業若干買家安排銀行融資，並就買家的還款責任提供擔保。該等擔保將按下列較早者終止：(i)房地產所有權證由政府部門發出給買家，此證一般在擔保登記完成後平均兩至三年內發出，並向按揭銀行提交時；或(ii)物業買家清償按揭貸款時。

The Group has arranged bank financing for certain purchasers of the Group’s properties and provided guarantees to secure obligations of such purchaser for repayments. Such guarantees will terminate upon the earlier of (i) the issue of the real estate ownership certificate by government authorities to the purchaser which will generally occur within an average period of two to three years from the completion of the guarantee registration and submitted to the mortgage bank; or (ii) the satisfaction of mortgage loans by the purchasers of the properties.

根據擔保條款，在該等買家拖欠按揭還款時，本集團須負責向銀行償還買家拖欠的按揭本金連同應計利息及罰金，而本集團有權接收相關物業的法定業權及所有權。本集團的擔保期由授出按揭日期起開始。董事認為買家拖欠付款的可能性極小，因此，按公允價值計量的財務擔保並非重大。

Pursuant to the terms of the guarantees, upon default of mortgage payments by these purchasers, the Group is responsible to repay the outstanding mortgage principal together with accrued interest and penalties owed by the defaulting purchasers to the banks and the Group is entitled to take over the legal title and possession of the related properties. The Group’s guarantee period starts from the date of grant of mortgage. The directors consider that the likelihood of default of payments by the purchasers is minimal and therefore the financial guarantee measured at fair value is immaterial.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-113

– F-114 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

36 財務擔保及或有負債（續）

(b) 公司擔保

於2012年及2011年12月31日，本集團的子公司就借款（附註21）相互提供若干企業擔保。董事認為各子公司有足夠財務資源償付其債務。

36 FINANCIAL GUARANTEES AND CONTINGENT LIABILITIES (Cont’d)

(b) corporate guarantees

There are certain corporate guarantees provided by the Group’s subsidiaries for each other in respect of borrowings (Note 21) as at 31 December 2012 and 2011. The directors consider that the subsidiaries are able to sufficiently financially resourced to settle their obligations.

37 關連方交易

(a) 關連方名稱及與關連方的關係

37 RELATED-PARTY TRANSACTIONS

(a) Name and relationship with related parties

名稱

Name

王先生

Mr. Wang 王曉松先生 Mr. Wang Xiaosong 富域香港投資有限公司

Wealth Zone Hong Kong Investments Limited

江蘇新城實業集團有限公司

Jiangsu Future Land Shiye Group. Ltd. 上海萬之城房地產開發有限公司

關係

Relationship

本公司的控股股東及董事

The controlling shareholder and a director of the Company 王先生的家族成員

Family member of Mr. Wang

王先生控股的公司及為本公司的母公司

A company controlled by Mr. Wang and is the Company’s parent company 王先生控股的公司

A company controlled by Mr. Wang 本集團的聯營公司

Shanghai Wan Zhi Cheng Real Estate Development Co., Ltd. An associated company of the Group 香港宏盛發展有限公司本公司的子公司

Hong Kong Prosperity Development Ltd. 香港創拓發展有限公司 Hong Kong Achievement Development Limited.

A subsidiary of the Company 本公司的子公司

A subsidiary of the Company

F-114

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-115 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

37 關連方交易（續）

37 RELATED-PARTY TRANSACTIONS

(Cont’d)

(b) 與關連方的交易

本集團

除於合併財務報表附註21披露的擔保外，本集團進行了以下關連方交易：

(b) Transactions with related parties

Group

Besides the guarantees as disclosed in Note 21 to the consolidated financial statements, the Group has the following related party transactions:

截至12月31日止年度 Year ended 31 December

				截至12月31日止年度 Year ended 31 December
				2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
(i)	向關連方出售股權	(i)	Disposal of equity interest to a related party
	－江蘇新城實業集團有限公司		– Jiangsu Future Land Shiye Group. Ltd.	– 500
(ii)	向關連方撥款	(ii)	Fundings to a related party
	－上海萬之城房地產開發		– Shanghai Wan Zhi Cheng Real Estate
	有限公司		Development Co., Ltd.	– 572,367
(iii)	轉讓負債－江蘇新城實業集團有限公司	(iii)	Transfer of liabilities – Jiangsu Future Land Shiye Group. Ltd.	44,000 –
(iv)	由關連方擔保的借款（附註21）	(iv)	Borrowings guaranteed by a related party
			(Note 21)
	－王先生		– Mr. Wang	– 901,500

(v) 佔用關連方擁有的物業

(v) Occupation of properties owned by a related party

本集團若干子公司佔用王曉松先生擁有的總建築面積為720平方米的若干物業作營運用途，且毋須支付任何費用。

Some subsidiaries of the Group occupied certain properties with total gross floor areas of 720 square meters owned by Mr. Wang Xiaosong for operational use, which is free of charge.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-115

– F-116 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

37 關連方交易（續）

37 RELATED-PARTY TRANSACTIONS

(Cont’d)

(b) 與關連方的交易（續）

(vi) 主要管理層報酬

主要管理層包括董事（執行和非執行）、財務總監、副總裁和總裁助理。就員工服務已付或應付予主要管理層之報酬列示如下：

(b) Transactions with related parties (Cont’d)

(vi) Key management compensation

Key management includes directors (executive and non-executive), chief financial officer, vice presidents and assistant presidents. The compensation paid or payable to key management for employee services is shown below:

截至12月31日止年度 Year ended 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000	截至12月31日止年度 Year ended 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
薪金及其他短期僱員福利 Salaries and other short-term employee benefits 36,597 離職後福利 Post-employment benefits 48	20,866 34
36,645	20,900
company 本公司

company

				截至12月31日止年度
				Year ended 31 December
				2012年 2011年
				2012 2011
				人民幣千元人民幣千元
				RMB’000 RMB’000
(i)	向關連方撥款	(i)	Fundings to a related party
	－香港宏盛發展有限公司		– Hong Kong Prosperity Development Ltd.	717,787 –
(ii)	替關連方墊支	(ii)	Paid on behalf of a related party
	－香港創拓發展有限公司		– Hong Kong Achievement Development Limited	60 –

F-116

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-117 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

37 關連方交易（續）

37 RELATED-PARTY TRANSACTIONS

(Cont’d)

(c) 關連方結餘 (c) Related-party balances

本集團

Group

Group 本集團	Group 本集團
於12月31日 As at 31 December 2012年 2011年 2012 2011 人民幣千元人民幣千元 RMB’000 RMB’000
(i)應收關連方款項（附註15） (i) Amount due from a related party (Note 15) －上海萬之城房地產開發有限公司 – Shanghai Wan Zhi Cheng Real Estate Development Co., Ltd. 180,000	390,367
(ii)應付關連方款項（附註23） (ii) Amount due to a related party (Note 23) －富域香港投資有限公司 – Wealth Zone Hong Kong Investments Limited –	4,404

本公司

company

				於12月31日	於12月31日
				As at 31	December
				2012年		2011年
				2012		2011
				人民幣千元	人民幣千元
				RMB’000		RMB’000
(i)	應收關連方款項（附註15）	(i)	Amounts due from related parties (Note 15)
	－香港宏盛發展有限公司		– Hong Kong Prosperity Development Ltd.	717,787		–
	－香港創拓發展有限公司		– Hong Kong Achievement Development Limited	60		–
				717,847		–
(ii)	應付關連方款項（附註23）	(ii)	Amount due to a related party (Note 23)
	－富域香港投資有限公司		– Wealth Zone Hong Kong Investments Limited	–		4,404

應收和應付關連方款項均無抵押、免息並需在獲通知後償還。

The amounts due from and due to related parties are unsecured, bear no interest and are repayable on demand.

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-117

– F-118 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情

本集團子公司於2012年及2011年12月31日的詳情載列如下：

38 PARTICULARS OF SUBSIDIARIES

Particulars of the subsidiaries of the Group as at 31 December 2012 and 2011 are as follows:

				於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Jiangsu Future Land Property	26 March 1996	5,000	5,000	53.70%	53.70%	Property management
Management Co., Ltd.	1996年3月26日					物業管理
江蘇新城物業服務有限公司
Future Land Holdings Co., Ltd.	14 June 1996	600,000	600,000	91.62%	91.62%	Development and sale of
新城控股集團有限公司	1996年6月14日					properties
						物業開發及銷售
Jiangsu Future Land Co., Ltd.	10 October 1997	1,593,187	1,593,187	53.93%	53.93%	Development and sale of
江蘇新城地產股份有限公司(a)	1997年10月10日					properties
						物業開發及銷售
Changzhou Future Land Real	26 April 1998	1,100,000	1,100,000	51.66%	51.66%	Development and sale of
Estate Development Co., Ltd.	1998年4月26日					properties
常州新城房產開發有限公司(a)						物業開發及銷售
Changzhou Wealthzone	27 April 2002	321,800	321,800	93.78%	93.78%	Development sale of
Development Co., Ltd.	2002年4月27日					properties
常州富域發展有限公司						物業開發及銷售
Nanjing Future Land Chuangzhi	9 September 2002	120,000	120,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2002年9月9日					properties
南京新城創置房地產有限公司						物業開發及銷售
Shanghai Future Land Chuangzhi	29 January 2003	210,000	210,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2003年1月29日					properties
上海新城創置房地產有限公司						物業開發及銷售

F-118

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-119 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

於12月31日應佔股權百分比 Percentage of attributable equity interest as at 31 December

		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Shanghai Future Land Wanjia	19 March 2003	410,000	410,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2003年3月19日					properties
上海新城萬嘉房地產有限公司						物業開發及銷售
Shanghai Future Land Wanjia	27 November 2003	500	500	53.52%	53.52%	Property management
Property Service Co., Ltd.	2003年11月27日					物業管理
上海新城萬嘉物業服務有限公司
Changzhou Xinlong Chuangzhi	16 September 2004	350,000	350,000	53.48%	53.48%	Development and sale of
Real Estate Development	2004年9月16日					properties
Co., Ltd.						物業開發及銷售
常州新龍創置房地產開發
有限公司(a)
Suzhou Future Land Wanjia Real	17 September 2004	100,000	100,000	51.89%	51.89%	Development and sale of
Estate Co., Ltd.	2004年9月17日					properties
蘇州新城萬嘉房地產有限公司						物業開發及銷售
Changzhou Future Land Wan Jia	20 May 2005	3,000	3,000	52.57%	52.57%	Construction design and
Construction Design Co., Ltd.	2005年5月20日					consulting
常州新城萬嘉建築設計有限公司						建築設計及諮詢
Changzhou Dingjia Property Real	27 May 2005	100,000	100,000	51.96%	51.96%	Development and sale of
Estate Development Co., Ltd.	2005年5月27日					properties
常州鼎佳房地產開發有限公司						物業開發及銷售
Changzhou Future Land Dongjun	27 December 2005	100,000	100,000	53.75%	53.75%	Development and sale of
Real Estate Development	2005年12月27日					properties
Co., Ltd.						物業開發及銷售
常州新城東郡房地產開發
有限公司

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-119

– F-120 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Kunshan Future Land Chuangzhi	7 April 2006	300,000	300,000	51.71%	51.71%	Development and sale of
Development Co., Ltd.	2006年4月7日					properties
昆山新城創置發展有限公司						物業開發及銷售
Changzhou Future Land Assets	24 October 2006	1,000	1,000	53.70%	53.70%	Asset operation and
Operation and Management	2006年10月24日					management
Co., Ltd.						資產運營及管理
常州新城資產經營管理有限公司
Changzhou Future Land Zhidi	13 December 2006	90,000	90,000	51.66%	51.66%	Development and sale of
Real Estate Development	2006年12月13日					properties
Co., Ltd.						物業開發及銷售
常州新城置地房地產開發
有限公司
Changzhou Future Land	13 December 2006	62,000	62,000	91.62%	91.62%	Development and sale of
Guangchang Property Co., Ltd.	2006年12月13日					properties
常州新城廣場置業有限公司						物業開發及銷售
Changzhou Jia Chi Auto Parts	16 January 2007	15,000	15,000	51.66%	51.66%	Marketing research of
Co., Ltd.	2007年1月16日					properties
常州嘉馳汽車配件有限公司						物業市場調研
（原常州嘉楓市場調查有限公司）
Changzhou Wanfang Future Land	6 February 2007	30,000	30,000	51.72%	51.72%	Development and sale of
Real Estate Development	2007年2月6日	(2011: 20,000)	(2011: 20,000)			properties
Co., Ltd.						物業開發及銷售
常州萬方新城房地產開發
有限公司

F-120 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-121 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

於12月31日應佔股權百分比 Percentage of attributable equity interest as at 31 December

		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Changzhou Fu Long Real Estate	6 February 2007	220,000	220,000	91.62%	91.62%	Development and sale of
Development Co., Ltd.	2007年2月6日	(2011: 10,000)	(2011: 10,000)			properties
常州福隆房地產開發有限公司						物業開發及銷售
Changzhou Future Land Wanbo	16 May 2007	615,000	615,000	91.62%	91.62%	Development and sale of
Property Co., Ltd.	2007年5月16日					properties
常州新城萬博置業有限公司						物業開發及銷售
Shanghai Dongjun Real Estate	31 May 2007	400,000	400,000	53.93%	53.93%	Development and sale of
Development Co., Ltd.	2007年5月31日					properties
上海東郡房地產開發有限公司(a)						物業開發及銷售
Wuxi Future Land Wanjia Property	14 August 2007	420,000	420,000	53.93%	53.93%	Development and sale of
Co., Ltd.	2007年8月14日					properties
無錫新城萬嘉置業有限公司						物業開發及銷售
Suzhou Future Land Chuangjia	11 October 2007	500,000	500,000	53.93%	53.93%	Development and sale of
Property Co., Ltd.	2007年10月11日	(2011:	(2011:			properties
蘇州新城創佳置業有限公司		400,000)	400,000)			物業開發及銷售
Changzhou Wanjia Property	18 January 2008	1,000	1,000	53.93%	53.93%	Consulting
Consultancy Co., Ltd.	2008年1月18日					諮詢服務
常州萬嘉置業諮詢有限公司
Future Land Wanbo Property	24 January 2008	220,000	220,000	91.62%	91.62%	Development and sale of
Co., Ltd.	2008年1月24日					properties
新城萬博置業有限公司						物業開發及銷售

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-121

– F-122 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

於12月31日應佔股權百分比 Percentage of attributable equity interest as at 31 December

		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Shanghai Future Land Chuangjia	20 March 2008	760,000	760,000	51.89%	51.89%	Development and sale of
Property Co., Ltd.	2008年3月20日	(2011:	(2011:			properties
上海新城創佳置業有限公司		210,000)	210,000)			物業開發及銷售
Changzhou Future Land	4 June 2009	360,000	360,000	53.75%	53.75%	Development and sale of
Dongsheng Real Estate Co., Ltd.	2009年6月4日	(2011:	(2011:			properties
常州新城東昇房地產有限公司		280,000)	280,000)			物業開發及銷售
Nanjing Future Land Chuangjia	2 July 2009	18,000	18,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2009年7月2日					properties
南京新城創嘉房地產有限公司						物業開發及銷售
Changzhou Future Land Jinjun	11 September 2009	470,000	470,000	51.66%	51.66%	Development and sale of
Real Estate Co., Ltd.	2009年9月11日					properties
常州新城金郡房地產有限公司(a)						物業開發及銷售
Changzhou Hengfu Property	26 November 2009	20,000	20,000	51.66%	51.66%	Development and sale of
Co., Ltd.	2009年11月26日					properties
常州市恒福置業有限公司(a)						物業開發及銷售
Changzhou Future Land Wanjia	10 December 2009	700,000	700,000	51.66%	51.66% (c)	Development and sale of
Real Estate Co., Ltd.	2009年12月10日					properties
常州新城萬佳房地產有限公司(a)						物業開發及銷售
Changzhou Future Land Hongye	28 December 2009	800,000	800,000	91.62%	91.62% (c)	Development and sale of
Real Estate Co., Ltd.	2009年12月28日					properties
常州新城宏業房地產有限公司						物業開發及銷售

F-122

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-123 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日	於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Nanjing Future Land Wanjia Real	13 January 2010	310,000	310,000	51.89%	51.89% (c)	Development and sale of
Estate Co., Ltd.	2010年1月13日					properties
南京新城萬嘉房地產有限公司(a)						物業開發及銷售
Changzhou Future Land	22 January 2010	520,000	520,000	51.89%	51.89% (c)	Development and sale of
Chuangjia Real Estate Co., Ltd.	2010年1月22日					properties
常州新城創佳房地產開發						物業開發及銷售
有限公司(a)
Shanghai Future Land	26 January 2010	420,000	420,000	51.89%	51.89% (c)	Development and sale of
Chuanghong Real Estate	2010年1月26日	(2011:	(2011:			properties
Co., Ltd.		770,000)	770,000)			物業開發及銷售
上海新城創宏房地產有限公司
Changzhou Future Land Keda	4 February 2010	500	500	91.62%	91.62%	Consulting
Investment Consultancy	2010年2月4日					諮詢服務
Co., Ltd.
常州新城科達投資諮詢有限公司
Changzhou Future Land Jingdian	4 February 2010	500	500	91.62%	91.62%	Development and sale of
Architectural Design Co., Ltd.	2010年2月4日					properties
常州新城經典建築設計有限公司						物業開發及銷售
Shanghai Future Land Nanjun Real	9 February 2010	–	–	–	51.89%	Development and sale of
Estate Co., Ltd.	2010年2月9日	(2011:	(2011:			properties
上海新城南郡房地產有限公司		550,000)	550,000)			物業開發及銷售
Shanghai Future Land Jinjun Real	26 March 2010	820,000	820,000	51.89%	51.89% (c)	Development and sale of
Estate Co., Ltd.	2010年3月26日	(2011:	(2011:			properties
上海新城金郡房地產有限公司(a)		473,000)	473,000)			物業開發及銷售

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-123

– F-124 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

於12月31日應佔股權百分比 Percentage of attributable equity interest as at 31 December

		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Wuxi Future Land Chuangzhi Real	6 May 2010	200,000	200,000	53.93%	53.93%	Development and sale of
Estate Co., Ltd.	2010年5月6日					properties
無錫新城創置房地產有限公司(a)						物業開發及銷售
Changzhou Future Land	12 June 2010	120,000	120,000	91.98%	91.98%	Development and sale of
Wansheng Real Estate Co., Ltd.	2010年6月12日					properties
常州新城萬盛房地產有限公司						物業開發及銷售
Hong Kong Prosperity	30 August 2010	10	–	100%	100%	Investment company
Development Ltd.	2010年8月30日					投資公司
香港宏盛發展有限公司(b)
Hong Kong Achievement	30 August 2010	10	3	100%	100%	Investment company
Development Limited	2010年8月30日		(2011: –)			投資公司
香港創拓發展有限公司(b)
Changzhou Future Land Wanbo	8 November 2010	10,000	10,000	91.62%	91.62%	Development and sale of
Commercial Management	2010年11月8日					properties
Co., Ltd.						物業開發及銷售
常州新城萬博商業管理有限公司
Shanghai Future Land Wansheng	10 November 2010	10,000	10,000	91.62%	91.62%	Development and sale of
Property Co., Ltd.	2010年11月10日					properties
上海新城萬聖置業有限公司						物業開發及銷售
Nanjing Future Land Yunsheng	19 November 2010	860,000	860,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2010年11月19日	(2011:	(2011:			properties
南京新城允升房地產有限公司		150,000)	150,000)			物業開發及銷售

F-124

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-125 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Changzhou Future Land Hongye	30 November 2010	10,000	10,000	91.62%	91.62%	Development and sale of
Baihuo Co., Ltd.	2010年11月30日					properties
常州新城宏業百貨有限公司						物業開發及銷售
Wuxi Future Land Wanbo	6 January 2011	500,000	500,000	91.17%	91.17%	Development and sale of
Property Co., Ltd.	2011年1月6日					properties
無錫新城萬博置業有限公司						物業開發及銷售
Jintan Future Land Wanjun	22 March 2011	10,000	10,000	71.64%	71.64%	Development and sale of
Property Co., Ltd.	2011年3月22日					properties
金壇市新城萬郡置業有限公司						物業開發及銷售
Changsha Future Land Wanbo	28 March 2011	420,000	420,000	91.62%	91.62%	Development and sale of
Property Co., Ltd.	2011年3月28日					properties
長沙新城萬博置業有限公司						物業開發及銷售
Changzhou Wuyue Guangchang	22 April 2011	–	–	–	91.62%	Department store
Commercial Management	2011年4月22日	(2011: 500)	(2011: 500)			management
Co., Ltd.						百貨商店管理
常州吾悅廣場商業管理有限公司
Changzhou Wuyue Baihuo	22 April 2011	500	500	91.62%	91.62%	Department store
Co., Ltd.	2011年4月22日					management
常州吾悅百貨有限公司						百貨商店管理
Shanghai Future Land Chuangyu	10 May 2011	30,000	30,000	51.89%	51.89%	Development and sale of
Real Estate Co., Ltd.	2011年5月10日					properties
上海新城創域房地產有限公司						物業開發及銷售

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-125

– F-126 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Kunshan Future Land	20 June 2011	370,000	370,000	53.93%	53.93%	Development and sale of
Chuanghong Real Estate	2011年6月20日	(2011:	(2011:			properties
Co., Ltd.		200,000)	200,000)			物業開發及銷售
昆山新城創宏房地產有限公司
Kunshan Future Land Chuangyu	23 June 2011	100,000	100,000	72.78%	72.78%	Development and sale of
Real Estate Co., Ltd.	2011年6月23日					properties
昆山新城創域房地產有限公司						物業開發及銷售
Changzhou Future Land Rui Yi	7 September 2011	1,000	1,000	51.66%	51.66%	Property, hotel
International Co., Ltd.	2011年9月7日					and conference
常州新城瑞壹國際酒店有限公司						management;
						apartment leasing
						services
						物業、酒店和會議管理
						以及公寓租賃服務
Changzhou Jiafeng Market	15 September 2011	5,000	5,000	51.66%	51.66%	Marketing research of
Research Co., Ltd.	2011年9月15日					properties
常州嘉楓市場調查有限公司						物業市場調研
Changsha Wanbo Property	21 September 2011	500	500	91.62%	91.62%	Property management
Management Co., Ltd.	2011年9月21日					物業管理
長沙萬博物業管理有限公司
Changzhou Derun Real Estate	25 November 2011	700,000	–	–	92.46%	Development and sale of
Co., Ltd.	2011年11月25日					properties
常州德潤房地產發展有限公司						物業開發及銷售

F-126

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-127 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日
				應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2012年	2011年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2012	2011	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
Changzhou Wuyue International	5 April 2012	5,000	5,000	91.62%	–	Department store
Plaza Commercial Management	2012年4月5日					management
Co., Ltd.						百貨商店管理
常州吾悅國際廣場商業管理
有限公司
Wuhan Future Land Hongsheng	9 May 2012	400,000	400,000	91.62%	–	Development and sale of
Property Co., Ltd.	2012年5月9日	(2011:	(2011:			properties
武漢新城宏盛置業有限公司		10,000)	10,000)			物業開發及銷售
Shanghai Fuming Real Estate	7 September 2009	338,000	338,000	51.89%	–	Development and sale of
Development Co., Ltd.	2009年9月7日	(2011: 8,000)	(2011: 8,000)			properties
上海富銘房地產開發有限公司*						物業開發及銷售
Changzhou Kaisheng Real Estate	19 June 2012	20,000	20,000	99.16%	–	Development and sale of
Co., Ltd.	2012年6月19日	(2011: –)	(2011: –)			properties
常州凱盛房地產發展有限公司						物業開發及銷售
Suzhou Future Land Chuangheng	13 August 2012	20,000	20,000	53.93%	–	Development and sale of
Real Estate Co., Ltd	2012年8月13日					properties
蘇州新城創恒房地產有限公司						物業開發及銷售
Shanghai Qingpu Injoy	31 December 2012	5,000	5,000	91.62%	–	Department store
Commercial Management	2012年12月31日					management
Co., Ltd.						百貨商店管理
上海青浦吾悅商業管理有限公司

於2012年5月16日，本集團以代價人民幣311,157,000元收購上海富銘房地產開發有限公司（「上海富銘」）100%股權。董事認為，此項收購實質屬於資產收購，而並非業務合併，因此作為資產收購入賬。
On 16 May 2012, the Group acquired 100% equity interest in Shanghai Fuming Real Estate Development Co., Ltd. (“Shanghai Fuming”), at a consideration of RMB311,157,000. The directors consider this acquisition is an asset acquisition in substance rather than a business combination and therefore is accounted for as an asset acquisition.

F-127

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited

– F-128 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

(a) 於2012年及2011年12月31日，本公司子公司若干股權已就借款予以抵押（附註21）。有關詳情，請參閱下表：
(a) Certain equity interests in the subsidiaries of the Company were pledged for borrowings as at 31 December 2012 and 2011, respectively (Note 21). For details, please refer to the table below:

		於12月31日	於12月31日
		As at 31	December
		2012年		2011年
		2012		2011
江蘇新城地產股份有限公司	Number of legal person shares of Jiangsu Future
法人股數目	Land Co., Ltd.	874,500,000	583,000,000
上海新城金郡房地產有限公司	Percentage of equity interests in Shanghai Future
股權百分比	Land Jinjun Real Estate Co., Ltd.	–		4.23%
南京新城萬嘉房地產有限公司	Percentage of equity interests in Nanjing Future
股權百分比	Land Wanjia Real Estate Co., Ltd.	–		51.61%
常州新龍創置房地產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Xinlong Chuangzhi Real Estate Development
	Co., Ltd.	–		100%
上海東郡房地產開發有限公司	Percentage of equity interests in Shanghai Dongjun
股權百分比	Real Estate Development Co., Ltd.	100%		100%
常州市恒福置業有限公司股權	Percentage of equity interests in Changzhou
百分比(i)	Hengfu Property Co., Ltd. (i)	100%		100%
常州新城創佳房地產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Chuangjia Real Estate Co., Ltd.	–		17.31%
常州新城房產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Real Estate Development Co., Ltd.	70%		70%
無錫新城創置房地產有限公司	Percentage of equity interests in Wuxi Future
股權百分比	Land Chuangzhi Real Estate Co., Ltd.	100%		100%
常州新城萬佳房地產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Wanjia Real Estate Co., Ltd.	100%		–
常州新城金郡房地產有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Jinjun Real Estate Co., Ltd.	100%		–

(i) 常州市恒福置業有限公司股權已就銀行借款予以抵押，除此之外，所抵押的所有其他股權均就信託融資安排予以抵押。

(i) The equity interests in Changzhou Hengfu Property Co., Ltd. were pledged for bank borrowing. Other than this, all other equity interests pledged are for trust financing arrangements.

F-128 新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-129 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

(b) 本公司於這些子公司直接擁有股權，而這些子公司於其他子公司直接或間接擁有股權。這些子公司於香港成立，而所有其他子公司於中國內地成立。
(c) 所呈報的應佔股權百分比為本集團持有的實益權益。於截止2011年12月31日，由於存在信託融資安排，這些實體的法定股權低於實益權益。
(b) The Company has direct equity interests in these subsidiaries which have direct or indirect equity interests in the other subsidiaries. These subsidiaries were incorporated in Hong Kong and all the other subsidiaries were established in mainland China.
(c) The percentage of attributable equity interest presented was the beneficiary interests held by the Group. The legal equity interests in these entities were lower than the beneficiary interests because of the existence of trust financing arrangements as at 31 December 2011.

於截止2011年12月31日，本集團將以下子公司的股權合法轉讓予信託公司作抵押品（附註 21）。

The Group had legally transferred the equity interests in the following subsidiaries as collateral (Note 21) to trust financing companies as at 31 December 2011.

		於12月31日
		as at 31 December
		2012年	2011年
		2012	2011
上海新城創宏房地產有限公司	Shanghai Future Land Chuanghong Property
	Co., Ltd.	–	45.45%
常州新城萬佳房地產開發有限公司	Changzhou Future Land Wanjia Real Estate
	Co., Ltd.	–	62.86%
南京新城萬嘉房地產有限公司	Nanjing Future Land Wanjia Real Estate Co., Ltd.	–	48.39%
上海新城金郡房地產有限公司	Shanghai Future Land Jinjun Real Estate Co., Ltd.	–	95.77%
常州新城宏業房地產有限公司	Changzhou Future Land Hongye Real Estate
	Co., Ltd.	–	98.75%
常州新城創佳房地產開發有限公司	Changzhou Future Land Chuangjia Real Estate
	Co., Ltd.	–	82.69%

二零一二年年報 2012 Annual Report 新城發展控股有限公司 Future Land Development Holdings Limited F-129

– F-130 –

合併財務報表附註

Notes to tHe CoNsoLiDateD FiNaNCiaL statemeNts

截至2012年12月31日止年度 For the year ended 31 December 2012

38 子公司詳情（續）

38 PARTICULARS OF SUBSIDIARIES

(Cont’d)

儘管如上文所述，本集團合法持有若干項目公司不超過50%的股權，但本集團保留對這些項目公司的控制，且有權享有大多數實益權益及承擔這些項目公司的風險。因此，這些項目公司在本集團財務報表中合併入賬。

Although the Group legally held less than 50% equity interests in certain project companies as indicated above, the Group retained control over these project companies, and was entitled to majority beneficiary interests and bore the risks of these project companies. Accordingly, the project companies were consolidated into the Group’s financial statements.

截至2012年12月31日，相關借款已於其到期前獲得償還，而上述所有信託融資安排經已終止。

As of 31 December 2012, the relevant borrowings had been repaid before their expiration and all the above trust financing arrangements had been terminated.

39 報告期後事項

本公司於2013年1月24日發行了200,000,000美元 10.25%於2018年到期的優先票據。

39 SUBSEqUENT EVENTS

The Company issued the USD200,000,000, 10.25% senior notes due 2018 on 24 January 2013.

F-130

新城發展控股有限公司 Future Land Development Holdings Limited 二零一二年年報 2012 Annual Report

– F-131 –

獨立核數師報告 Independent AudItor’s report

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致新城發展控股有限公司股東

（於開曼群島註冊成立的有限責任公司）

本核數師（以下簡稱「我們」）已審計列載於第F-3頁至第 F-150頁新城發展控股有限公司（以下簡稱「貴公司」）及其子公司（統稱「貴集團」）的合併財務報表，此合併財務報表包括於2013年12月31日的合併和公司財務狀況表與截至該日止年度的合併利潤表、合併全面收益表、合併權益變動表及合併現金流量表，以及主要會計政策概要及其他附註解釋資料。

董事就合併財務報表須承擔的責任

核數師的責任

to tHe sHAreHoLders oF Future LAnd deVeLopMent HoLdInGs LIMIted

(incorporated in the Cayman Islands with limited liability)

We have audited the consolidated financial statements of Future Land Development Holdings Limited (the “Company”) and its subsidiaries (together, the “Group”) set out on pages F-3 to F-150, which comprise the consolidated and company statement of financial position as at 31 December 2013, and the consolidated statement of income, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

DIRECTORS’ RESPONSIBILITY FOR THE

CONSOLIDATED FINANCIAL STATEMENTS

AUDITOR’S RESPONSIBILITY

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新城發展控股有限公司 Future Land development Holdings Limited F-1 二零一三年年報 2013 Annual Report

– F-132 –

獨立核數師報告 Independent AudItor’s report

==> picture [21 x 302] intentionally omitted <==

==> picture [77 x 55] intentionally omitted <==

我們相信，我們所獲得的審計憑證能充足和適當地為我們的審計意見提供基礎。

意見

我們認為，該等合併財務報表已根據香港財務報告準則真實而公平地反映貴公司及貴集團於2013年12月31日的事務狀況，及貴集團截至該日止年度的利潤及現金流量，並已按照香港《公司條例》的披露規定妥為編製。

羅兵咸永道會計師事務所

執業會計師

香港，2014年3月17日

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINION

In our opinion, the consolidated financial statements give a true and fair view of the state of affairs of the Company and of the Group as at 31 December 2013, and of the Group’s profit and cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards and have been properly prepared in accordance with the disclosure requirements of the Hong Kong Companies Ordinance.

Pricewaterhousecoopers

Certified Public Accountants

Hong Kong, 17 March 2014

F-2 新城發展控股有限公司 Future Land development Holdings Limited 二零一三年年報 2013 Annual Report

– F-133 –

合併資產負債表 CONSOLIDATED STATEMENT OF FINANCIAL POSITION

於2013年12月31日 As at 31 December 2013

			於12月31日	於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
		附註	人民幣千元	人民幣千元
		Note	RMB’000		RMB’000
資產	ASSETS
非流動資產	Non-current assets
物業、廠房和設備	Property, plant and equipment	7	116,009		117,074
投資物業	Investment properties	8	3,307,000		3,105,600
無形資產	Intangible assets	9	9,836		7,267
於聯營公司的投資	Investments in associates	10	43,468		229,890
於合營企業的投資	Investment in a joint venture	11	10,000		–
遞延所得稅資產	Deferred income tax assets	25	499,738		361,193
可供出售金融資產	Available-for-sale financial assets	12	221,187		181,187
土地使用權	Land use rights	13	367,248		367,248
其他應收款項	Other receivables	16	198,538		–
			4,773,024		4,369,459
流動資產	Current assets
租賃土地預付款項	Prepayments for leasehold land	14	3,285,498		4,313,847
完工待售或在建銷售物業	Properties held or under development
	for sale	15	28,728,964	24,493,752
貿易及其他應收款項和	Trade and other receivables and
預付款項	prepayments	16	2,112,831		1,666,266
受限制現金	Restricted cash	18	886,180		1,148,089
現金和現金等價物	Cash and cash equivalents	18	7,411,713		4,852,130
			42,425,186	36,474,084
資產總額	Total assets		47,198,210	40,843,543
所有者權益	OWNERS’ EQUITY
本公司權益持有人應佔	Capital and reserves attributable to
股本及儲備	equity holders of the Company
已發行及繳足股本	Issued and fully paid capital	19	4,617		4,617
儲備	Reserves	21	6,717,031		5,746,486
			6,721,648		5,751,103
非控股權益	Non-controlling interests		3,876,311		2,643,924
權益總額	Total equity		10,597,959		8,395,027

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新城發展控股有限公司 Future Land Development Holdings Limited F-3 二零一三年年報 2013 Annual Report

– F-134 –

合併資產負債表 CONSOLIDATED STATEMENT OF FINANCIAL POSITION

於2013年12月31日 As at 31 December 2013

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			於12月31日	於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
		附註	人民幣千元	人民幣千元
		Note	RMB’000		RMB’000
負債	LIABILITIES
非流動負債	Non-current liabilities
借款	Borrowings	22	11,715,075		4,509,670
遞延所得稅負債	Deferred income tax liabilities	25	432,922		402,872
			12,147,997		4,912,542
流動負債	Current liabilities
貿易和其他應付款項	Trade and other payables	24	10,368,476		9,597,029
預售物業預收款項	Advances from pre-sale of properties	23	10,235,042	11,663,869
即期所得稅負債	Current income tax liabilities		1,673,306		1,143,835
借款	Borrowings	22	2,174,501		5,130,436
應付股息	Dividends payable		929		805
			24,452,254	27,535,974
負債總額	Total liabilities		36,600,251	32,448,516
權益及負債總額	Total equity and liabilities		47,198,210	40,843,543
流動資產淨值	Net current assets		17,972,932		8,938,110
資產總額減流動負債	Total assets less current liabilities		22,745,956	13,307,569

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

Wang Zhenhua 王振華 Director 董事

Huang Maoli 黃茂莉 Director 董事

F-4 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-135 –

本公司資產負債表 STATEMENT OF FINANCIAL POSITION OF THE COMPANY

於2013年12月31日 As at 31 December 2013

			於12月31日	於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
		附註	人民幣千元	人民幣千元
		Note	RMB’000		RMB’000
資產	ASSETS
非流動資產	Non-current assets
於子公司的投資	Investments in subsidiaries	17	450,012		424,271
流動資產	Current assets
貿易及其他應收款項	Trade and other receivables	16	3,834,468		718,417
現金和現金等價物	Cash and cash equivalents	18	7,497		895,307
			3,841,965		1,613,724
資產總額	Total assets		4,291,977		2,037,995
所有者權益	OWNERS’ EQUITY
本公司權益持有人	Capital and reserves attributable to
應佔股本及儲備	equity holders of the Company
已發行及繳足股本	Issued and fully paid capital	19	4,617		4,617
儲備	Reserves	21	1,536,108		2,019,589
權益總額	Total equity		1,540,725		2,024,206
非流動負債	Non-current liabilities
借款	Borrowings	22	2,667,075		–
流動負債	Current liabilities
貿易和其他應付款項	Trade and other payables	24	84,177		13,789
負債總額	Total liabilities		2,751,252		13,789
權益及負債總額	Total equity and liabilities		4,291,977		2,037,995
流動資產淨值	Net current assets		3,757,788		1,599,935
資產總額減流動負債	Total assets less current liabilities		4,207,800		2,024,206

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

Wang Zhenhua 王振華 Director 董事

Huang Maoli

黃茂莉 Director 董事

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新城發展控股有限公司 Future Land Development Holdings Limited F-5 二零一三年年報 2013 Annual Report

– F-136 –

合併利潤表 CONSOLIDATED STATEMENT OF INCOME

截至2013年12月31日止年度 For the year ended 31 December 2013

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			截至12月31日止年度	截至12月31日止年度
			Year ended 31 December
			2013年	2012年
			2013	2012
		附註	人民幣千元	人民幣千元
		Note	RMB’000	RMB’000
收入	Revenue	26	20,771,255	17,517,266
銷售成本	Cost of sales	28	(16,088,038)	(13,587,371)
毛利	Gross profit		4,683,217	3,929,895
投資物業公允價值收益	Fair value gains on investment properties	8	37,839	31,086
銷售和營銷成本	Selling and marketing costs	28	(592,032)	(474,921)
行政開支	Administrative expenses	28	(680,028)	(569,883)
其他收入	Other income	27	151,674	9,475
其他開支	Other expenses	27	(4,152)	(4,347)
其他收益－淨額	Other gains – net	27	46,270	13,626
經營利潤	Operating profit		3,642,788	2,934,931
財務收入	Finance income	29	121,793	48,052
融資成本	Finance costs	29	(516,693)	(159,712)
融資成本－淨額	Finance costs – net		(394,900)	(111,660)
應佔聯營公司業績	Share of results of an associated company	10	(11,422)	(5,110)
除所得稅前利潤	Profit before income tax		3,236,466	2,818,161
所得稅開支	Income tax expense	31	(1,519,329)	(1,232,777)
年度利潤	Profit for the year		1,717,137	1,585,384
應佔年度利潤：	Attributable to:
本公司權益持有人	Equity holders of the Company		981,262	930,819
非控股權益	Non-controlling interests		735,875	654,565
			1,717,137	1,585,384
本公司權益持有人應佔	Earnings per share for profit attributable
利潤的每股盈利	to equity holders of the Company
－基本及攤薄	– Basic and diluted	32	RMB0.17	RMB0.21
股息	Dividends	33	283,400	283,400

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

F-6 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-137 –

合併全面收益表 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

截至2013年12月31日止年度 For the year ended 31 December 2013

			截至12月31日止年度
			Year ended 31 December
			2013年 2012年
			2013 2012
		附註	人民幣千元人民幣千元
		Note	RMB’000 RMB’000
年度利潤	Profit for the year		1,717,137 1,585,384
其他全面收益	Other comprehensive income		– –
年度全面收益總額	Total comprehensive income for the year		1,717,137 1,585,384
應佔年度全面收益總額：	Attributable to:
本公司權益持有人	Equity holders of the Company		981,262 930,819
非控股權益	Non-controlling interests		735,875 654,565
			1,717,137 1,585,384

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

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新城發展控股有限公司 Future Land Development Holdings Limited F-7 二零一三年年報 2013 Annual Report

– F-138 –

合併權益變動表 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

截至2013年12月31日止年度 For the year ended 31 December 2013

本公司權益持有人應佔

Attributable to equity holders of the Company

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		股本	股份溢價	其他儲備	保留盈利	小計	非控股權益	權益總額
		Share	Share	Other	Retained		Non-controlling	Total
		capital	premium	reserves	earnings	Sub-total	interests	equity
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
		（附註19）	（附註21）	（附註21）	（附註21）
		(Note 19)	(Note 21)	(Note 21)	(Note 21)
於2013年1月1日的結餘	Balance at 1 January 2013	4,617	1,962,640	(177,501)	3,961,347	5,751,103	2,643,924	8,395,027
全面收益	Comprehensive income
年度利潤	Profit for the year	–	–	–	981,262	981,262	735,875	1,717,137
其他全面收益	Other comprehensive income	–	–	–	–	–	–	–
全面收益總額	Total comprehensive income	–	–	–	981,262	981,262	735,875	1,717,137
與擁有人進行的交易	Transactions with owners
非控股權益投入的資本金	Capital injections from
	non-controlling interests	–	–	–	–	–	809,000	809,000
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee
	services	–	–	25,741	–	25,741	–	25,741
2012年末期股息（附註33）	2012 final dividend (Note 33)	–	(283,400)	–	–	(283,400)	–	(283,400)
子公司股息	Dividends of subsidiaries	–	–	–	–	–	(65,546)	(65,546)
擁有人的投入及分配總額	Total contributions by and
	distributions to owners	–	(283,400)	25,741	–	(257,659)	743,454	485,795
向非控股股東收購	Gain from acquisition of
子公司額外權益	additional interest in a
所得的收益	subsidiary from non-controlling
（附註40）	interests (Note 40)	–	–	246,942	–	246,942	(246,942)	–
直接於權益確認與擁有人的	Total transactions with owners,
交易總額	recognized directly in equity	–	(283,400)	272,683	–	(10,717)	496,512	485,795
於2013年12月31日的結餘	Balance at 31 December 2013	4,617	1,679,240	95,182	4,942,609	6,721,648	3,876,311	10,597,959

F-8 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-139 –

合併權益變動表 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

截至2013年12月31日止年度 For the year ended 31 December 2013

本公司權益持有人應佔

			Attributable to	equity holders of the Company	equity holders of the Company
		股本	股份溢價	其他儲備	保留盈利	小計	非控股權益	權益總額
		Share	Share	Other	Retained		Non-controlling	Total
		capital	premium	reserves	earnings	Sub-total	interests	equity
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
		（附註19）	（附註21）	（附註21）	（附註21）
		(Note 19)	(Note 21)	(Note 21)	(Note 21)
於2012年1月1日的結餘	Balance at 1 January 2012	3,466	360,020	(214,198)	3,030,528	3,179,816	2,022,133	5,201,949
全面收益	Comprehensive income
年度利潤	Profit for the year	–	–	–	930,819	930,819	654,565	1,585,384
其他全面收益	Other comprehensive income	–	–	–	–	–	–	–
全面收益總額	Total comprehensive income	–	–	–	930,819	930,819	654,565	1,585,384
與擁有人進行的交易	Transactions with owners
發行普通股（附註19）	Issuance of ordinary shares
	(Note 19)	1,151	1,602,620	–	–	1,603,771	–	1,603,771
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee
	services	–	–	36,697	–	36,697	–	36,697
子公司股息	Dividends of subsidiaries	–	–	–	–	–	(32,774)	(32,774)
擁有人的投入及分配總額	Total contributions by and
	distributions to owners	1,151	1,602,620	36,697	–	1,640,468	(32,774)	1,607,694
於2012年12月31日的結餘	Balance at 31 December 2012	4,617	1,962,640	(177,501)	3,961,347	5,751,103	2,643,924	8,395,027

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

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新城發展控股有限公司 Future Land Development Holdings Limited F-9 二零一三年年報 2013 Annual Report

– F-140 –

合併現金流量表 CONSOLIDATED STATEMENT OF CASH FLOWS

截至2013年12月31日止年度 For the year ended 31 December 2013

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			截至12月31日止年度	截至12月31日止年度
			Year ended 31 December
			2013年	2012年
			2013	2012
		附註	人民幣千元	人民幣千元
		Note	RMB’000	RMB’000
經營活動	Operating activities
經營活動（所用）╱所得現金	Cash (used in)/generated from operations	35	(918,758)	3,161,944
已付利息	Interest paid		(1,241,203)	(1,023,291)
已付中國所得稅	PRC income tax paid		(518,158)	(561,268)
已付中國土地增值稅	PRC land appreciation tax paid		(589,730)	(514,816)
經營活動（所用）╱所得現金淨額	Net cash (used in)/generated from
	operating activities		(3,267,849)	1,062,569
投資活動	Investing activities
添置投資物業	Additions of investment properties		(163,561)	(551,308)
添置物業、廠房及設備	Additions of property, plant and equipment		(34,431)	(20,925)
出售物業、廠房及設備所得款項	Proceeds from disposal of property,
	plant and equipment	35	15,580	835
添置無形資產	Additions of intangible assets	9	(4,987)	(3,457)
於合營企業的投資	Investment in a joint venture	11	(10,000)	–
聯營公司投入的資本減少	Capital reduction from an associate	10	175,000	–
收購可供出售金融資產	Acquisition of available-for-sale
	financial assets	12	(40,000)	(25,187)
出售子公司，扣除相關出售現金	Disposal of subsidiary, net of cash disposed	38	89,843	–
已收股息	Dividends received	27	6,605	5,042
已收利息	Interest received	29	121,793	48,052
投資活動所得╱（所用）	Net cash generated from/(used in)
現金淨額	investing activities		155,842	(546,948)
融資活動	Financing activities
借款所得款項	Proceeds from borrowings		15,652,864	6,249,311
發行優先票據所得款項	Proceeds from issuance of senior notes		2,691,503	–
償還借款	Repayments of borrowings		(14,006,687)	(7,475,768)
與融資活動相關的	Increase in restricted cash relating to
受限制現金增加	financing activities	18	371,815	(229,589)
向本公司權益持有人支付股息	Dividends paid to equity holders of
	the Company		(283,400)	–
向非控股股東支付股息	Dividends paid to non-controlling interests		(65,422)	(32,774)
非控股權益投入的資本金	Capital contribution from non-controlling
	interests		809,000	–
子公司非控股權益往來款	Advance from non-controlling interest
	of a subsidiary		555,580	–
發行普通股所得款項	Proceeds from issuance of ordinary shares	19	–	1,668,936
支付股份發行成本	Payments of share issuance costs	19	–	(65,165)
融資活動所得現金淨額	Net cash generated from financing
	activities		5,725,253	114,951
現金和現金等價物增加淨額	Net increase in cash and cash equivalents		2,613,246	630,572
年初的現金和現金等價物	Cash and cash equivalents at beginning
	of the year		4,852,130	4,221,558
現金及現金等價物匯兌損失	Exchange loss on cash and cash equivalents	29	(53,663)	–
年末的現金和現金等價物	Cash and cash equivalents at end
	of the year	18	7,411,713	4,852,130

第F-11頁至第F-150頁的附註為財務報表的一部分。

The notes on pages F-11 to F-150 are an integral part of these financial statements.

F-10 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-141 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

1 一般資料

新城發展控股有限公司（「本公司」）於2010年4月 23日根據開曼群島公司法（2010年修訂本）在開曼群島註冊成立為獲豁免有限公司。註冊辦事處地址為Floor 4, Willow House, Cricket Square, P.O. Box 2804, Grand Cayman KY1-1112, Cayman Islands。

本公司及其子公司（統稱「本集團」）主要在中華人民共和國（「中國」）從事物業發展及物業投資業務。本公司的母公司為富域香港投資有限公司（「富域香港」），本公司的最終控股公司為First Priority Group Limited，兩家公司均於英屬處女群島註冊成立。本集團最終控股方為王振華先生（「王先生」或「控股股東」）。

本公司股份於2012年11月29日開始在聯交所主板上市（「上市」）。

除另有指明外，合併財務報表以人民幣千元（「人民幣千元」）為單位呈列。

本公司董事會（「董事會」）於2014年3月17日批准及授權刊發此等載於第F-3頁至第F-150頁的合併財務報表。

1 GENERAL INFORMATION

Future Land Development Holdings Limited (the “Company”) was incorporated in the Cayman Islands on 23 April 2010 as an exempted company with limited liability under the Companies Law (2010 Revision) of the Cayman Islands. The address of its registered office is Floor 4, Willow House, Cricket Square, P.O. Box 2804, Grand Cayman KY11112, Cayman Islands.

The Company’s shares began to list on the Main Board of the Stock Exchange on 29 November 2012 (the “Listing”).

The consolidated financial statements are presented in thousands of Renminbi (“RMB’000”), unless otherwise stated.

These consolidated financial statements set out on pages F-3 to F-150 have been approved and authorized for issue by the board of directors (the “Board”) of the Company on 17 March 2014.

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新城發展控股有限公司 Future Land Development Holdings Limited F-11 二零一三年年報 2013 Annual Report

– F-142 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

2 重大會計政策概要

編製該合併財務報表所採用之主要會計政策載於下文。除另有說明者外，此等政策於所呈列的年度貫徹應用。

2.1 編製基準

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation

F-12 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-143 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2013年採納之新訂準則及修訂

以下對新訂準則及現有準則之修訂於2013年 1月1日開始之財政年度首次強制應用，而且與本集團之業務有關：

香港會計準則第1號（修訂本）「財務報表的呈列」（於2012年7月1日或之後開始的年度期間生效）。該修訂導致的主要變動是要求實體根據在「其他全面收益」項內呈報的項目其後是否可能重新分類至損益而分類該等項目（重新分類調整）。
香港財務報告準則第7號（修訂本）「金融工具：披露－抵銷金融資產及金融負債」（於2013年1月1日或之後開始的年度期間生效）。該修訂作出新披露規定，集中處理於資產負債表中對銷的已確認金融工具以及受總互抵協定或類似安排規限的已確認金融工具（不論是否會對銷）的量化資料。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(i) New standards and amendments adopted by the Group in 2013

T h e f o l l o w i n g n e w s t a n d a r d s a n d amendments to existing standards are mandatory for the first time for the financial year beginning on 1 January 2013 and are relevant to the Group’s operations.

HKAS 1 (Amendment) “Presentation of Financial Statements” (effective for annual periods beginning on or after 1 July 2012). The main change resulting from the amendment is a requirement for entities to group items presented in ‘other comprehensive income’ (OCI) on the basis of whether they are potentially reclassifiable to profit or loss subsequently (reclassification adjustments).
HKFRS 7 (Amendment) “Financial Instruments: Disclosures – Offsetting Financial Assets and Financial Liabilities” (effective for annual periods beginning on or after 1 January 2013). The amendment requires new disclosure requirements w h i c h f o c u s o n q u a n t i t a t i v e information about recognised financial instruments that are offset in the statement of financial position, as well as those recognised financial instruments that are subject to master netting or similar arrangements irrespective of whether they are offset.

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新城發展控股有限公司 Future Land Development Holdings Limited F-13 二零一三年年報 2013 Annual Report

– F-144 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2013年採納之新訂準則及修訂 （續）
香港財務報告準則第10號「合併財務報表」（於2013年1月1日或之後開始的年度期間生效）。該準則以現有原則為基礎，確定將控制權概念作為釐定實體應否計入母公司合併財務報表的因素。該準則提供額外指引，以在難以評估的情況下協助釐定控制權。
香港會計準則第27號（2011年修訂）
「個別財務報表」（於2013年1月1日或之後開始的年度期間生效）。該準則載入香港會計準則第27號的規管條文併入新香港財務報告準則第10號後遺留的有關獨立財務報表的條文。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)
(i) New standards and amendments adopted by the Group in 2013 (Cont’d)
- HKFRS 10 “Consolidated Financial Statements” (effective for annual periods beginning on or after 1 January 2013). The standard builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess.
- HKAS 27 (Revised 2011) “Separate Financial Statements” (effective for annual periods beginning on or after 1 January 2013). The standard includes the provisions on separate financial statements that are left after the control provisions of HKAS 27 have been included in the new HKFRS 10.

F-14 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-145 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2013年採納之新訂準則及修訂 （續）
香港財務報告準則第11號「合營安排」
（於2013年1月1日或之後開始的年度期間生效）。此準則更現實地反映合營安排，集中針對合營安排的權利及義務，而非其法定形式。合營安排有兩類：共同經營及合營企業。共同經營指其共同經營者有權獲得與安排有關的資產和債務，因而將其於資產、負債、收入及開支的權益入賬。在合營企業中，合營者享有安排下淨資產的權利，因而以權益法將其權益入賬。現已不再容許以比例合併法將合營企業的權益入賬。
香港會計準則第28號（2011年修訂）
「於聯營公司和合營企業的投資」（於 2013年1月1日或之後開始的年度期間生效）此準則包括於香港財務報告準則第11號發表後須以權益法將聯營公司及合營企業入賬的規定。
香港財務報告準則第12號「披露於其他實體之權益」（於2013年1月1日或之後開始的年度期間生效）。該準則包括在其他實體的所有形式的權益的披露規定，包括合營安排、聯營、特別目的載體和其他資產負債表外載體的披露規定。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(i) New standards and amendments adopted by the Group in 2013 (Cont’d)

HKFRS 11 “Joint Arrangements” ( e ff e c t i v e f o r a n n u a l p e r i o d s beginning on or after 1 January 2013). The standard is a more r e a l i s t i c r e f l e c t i o n o f j o i n t arrangements by focusing on the rights and obligations of the arrangement rather than its legal form. There are two types of joint arrangement: joint operations and joint ventures. Joint operations arise where a joint operator has rights to the assets and obligations relating to the arrangement and hence accounts for its interest in assets, liabilities, revenue and expenses. Joint ventures arise where the joint operator has rights to the net assets of the arrangement and hence equity accounts for its interest. Proportional consolidation of joint ventures is no longer allowed.
HKAS 28 (Revised 2011) “Investments in Associates and Joint Ventures” ( e ff e c t i v e f o r a n n u a l p e r i o d s beginning on or after 1 January 2013). The standard includes the requirements for joint ventures, as well as associates, to be equity accounted following the issue of HKFRS 11.
HKFRS 12 “Disclosure of Interests in Other Entities” (effective for annual periods beginning on or after 1 January 2013). The standard includes the disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles.

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新城發展控股有限公司 Future Land Development Holdings Limited F-15 二零一三年年報 2013 Annual Report

– F-146 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2013年採納之新訂準則及修訂 （續）
香港財務報告準則第13號「公平值計量」（於2013年1月1日或之後開始的年度期間生效）。該準則旨在透過提供公平值的精確定義及公平值計量的單一來源以及適用於各香港財務報告準則的披露規定，提高一致及簡化程度。該等規定並無擴大公平值會計的使用，但就當該準則獲香港財務報告準則內其他準則規定或准許使用時應如何應用提供指引。
香港財務報告準則第10號、香港財務報告準則第11號及香港財務報告準則第12號（修訂本）「過渡性指引」（於 2013年1月1日或之後開始的年度期間生效）。該等修訂為香港財務報告準則第10號、香港財務報告準則第11號及香港財務報告準則第12號提供額外過渡性指引，將提供經調整比較資料的要求僅局限於上個比較期間。有關未合併結構性實體之披露，修訂本不再要求提供首次採納香港財務報告準則第12號前之期間的比較資料。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)
(i) New standards and amendments adopted by the Group in 2013 (Cont’d)
- HKFRS 13 “Fair Value Measurement” ( e ff e c t i v e f o r a n n u a l p e r i o d s beginning on or after 1 January 2013). The standard aims to improve consistency and reduce complexity by providing a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across HKFRSs. The requirements do not extend the use of fair value accounting but provide guidance on how it should be applied where its use is already required or permitted by other standards within HKFRSs.
- HKFRSs 10, 11 and 12 (Amendments) “Transition Guidance” (effective for annual periods beginning on or after 1 January 2013). These amendments provide additional transition relief to HKFRSs 10, 11 and 12, limiting the requirement to provide adjusted comparative information to only the preceding comparative period. For disclosures related to unconsolidated structured entities, the amendments remove the requirement to present comparative information for periods before HKFRS 12 is first applied.

F-16 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-147 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.1 編製基準（續）

(i) 本集團於2013年採納之新訂準則及修訂 （續）
2011年之年度改進－該等年度改進主要針對2009年至2011年報告週期的六個方面。該等改進包括對以下與本集團之業務有關的準則之變動：

香港會計準則第1號「財務報表的呈列」

香港會計準則第16號「物業、廠房和設備」
香港會計準則第32號「金融工具：呈列」
香港會計準則第34號「中期財務申報」
2012年之年度改進－對香港財務報告準則第13號「公允價值計量」之修訂。該項修訂為澄清：當不作貼現之影響不重大時，對短期應收款項及應付款項之計量要求並無變動。

於2013年1月1日起採納上述新準則及修訂及其他新生效之香港財務報告準則並無對本集團截至2013年12月31日止年度的經營業績及財務狀況產生任何重大影響。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(i) New standards and amendments adopted by the Group in 2013 (Cont’d)

Annual improvements 2011 – These annual improvements address six issues in the 2009-2011 reporting cycle. They include changes to the following standards which are relevant to the Group’s operations:
HKAS 1 “Presentation of Financial Statements”
HKAS 16 “Property, Plant and Equipment”
HKAS 32 “Financial Instruments: Presentation”
H K A S 3 4 “ I n t e r i m F i n a n c i a l Reporting”
A n n u a l i m p ro v e m e n t 2 0 1 2 – Amendment to HKFRS 13 “Fair Value Measurement”. This amendment is a clarification that there is no change in measurement requirements for short-term receivables and payables when the effect of not discounting is immaterial:

The adoption of the above new standards and amendments and other newly effective HKFRSs starting from 1 January 2013 did not give rise to any significant impact on the Group’s results of operations and financial position for the year ended 31 December 2013.

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新城發展控股有限公司 Future Land Development Holdings Limited F-17 二零一三年年報 2013 Annual Report

– F-148 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.1 編製基準（續）

(ii) 本集團於2013年後將須採納的新訂準則、修訂及詮釋

若干香港財務報告準則的新訂準則、修訂本及詮釋已頒佈但於2013年1月1日開始的年度仍未生效。該等與本集團營運相關的準則列示如下：

香港財務報告準則金融工具（於2015年1月1日或第9號之後開始的年度期間生效）香港會計準則資產減值（於2014年1月1日或第36條（修訂本）之後開始的年度期間生效）香港（國際財務徵費（於2014年1月1日或報告詮釋委員會）之後開始的年度期間生效）詮釋第21號香港會計準則按資產與負債抵銷的金融工具第32號之修訂呈列（於2014年1月1日或之後開始的年度期間生效）

香港財務報告準則合併投資實體（於2014年第10號、香港財務 1月1日或之後開始的報告準則第12號及年度期間生效）香港會計準則第27號之修訂香港會計準則金融工具（於2014年1月1日或第39號之修訂之後開始的年度期間生效）

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)
(ii) New standards,amendments and interpretations that are required to be adopted by the Group after 2013

Certain new standards, amendments and interpretations of HKFRSs have been published but are not yet effective for the annual period beginning on 1 January 2013. Those that are relevant to the Group’s operations are as follows:

HKFRS 9 Financial Instruments (effective for annual periods beginning on or after 1 January 2015) HKAS 36 Impairment of Assets (effective for (Amendment) annual periods beginning on or after 1 January 2014) HK(IFRIC) 21 Levies (effective for annual periods beginning on or after 1 January 2014) Amendment to Financial Instruments Presentation HKAS 32 on Asset and Liability offsetting (effective for annual periods beginning on or after 1 January 2014) Amendments to Consolidation for Investment Entities HKFRS 10, 12 (effective for annual periods and HKAS 27 beginning on or after 1 January 2014) Amendment to Financial Instruments (effective for HKAS 39 annual periods beginning on or after 1 January 2014)

F-18 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-149 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.1 編製基準（續）

(ii) 本集團於2013年後將須採納的新訂準則、修訂及詮釋 （續）

2012年之年度改進有關年度改進包括對2010年至 2012年年度週期影響7項準則的改進項目的修改：香港財務報告準則第2號「以股份為基礎的支付」、香港財務報告準則第3號「企業合併」、香港財務報告準則第8號「經營分部」、香港財務報告準則第 13號「公允價值計量」的結論基礎、香港會計準則第16 號「物業、廠房及設備」、香港會計準則第24號「關聯方披露」及香港會計準則第38號「無形資產」。（於2014年7 月1日或之後開始的年度期間起生效）

2013年之年度改進有關年度改進包括對2011年至 2013年年度週期影響4項準則的改進項目的修改：香港財務報告準則第1號「首次採納香港財務報告準則」、香港財務報告準則第3號「企業合併」、香港財務報告準則第 13號「公允價值計量」及香港會計準則第40號「投資物業」。（於2014年7月1日或之後開始的年度期間起生效）

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(ii) New standards,amendments and interpretations that are required to be adopted by the Group after 2013 (Cont’d)

Annual The amendments include changes improvements from the 2010-2012 cycle of the 2012 annual improvements project that affect 7 standards: HKFRS 2 “Share-based Payment”, HKFRS 3 “Business Combinations”, HKFRS 8 “Operating Segments”, the basis for conclusion on HKFRS 13 “Fair Value Measurement”, HKAS 16 “Property, Plant and Equipment”, HKAS 24 “Related Party Disclosures” and HKAS 38 “Intangible Assets”. (effective for annual periods beginning on or after 1 July 2014)

Annual The amendments include changes improvements f ro m t h e 2 0 1 1 - 2 0 1 3 c y c l e 2013 of the annual improvements project that affect 4 standards: HKFRS 1 “First-time Adoption of Hong Kong Financial Reporting Standards”, HKFRS 3 “Business Combinations’’, HKFRS 13 “Fair Value Measurement” and HKAS 40 “Investment Property’’. (effective for annual periods beginning on or after 1 July 2014)

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F-19

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-150 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.1 編製基準（續）

(ii) 本集團於2013年後將須採納的新訂準則、修訂及詮釋 （續）

於2013年，本集團並無提早採納已頒佈但未生效的任何新訂準則、修訂及詮釋。本集團正評估此等新訂準則、修訂及詮釋的影響，並且不預期於生效採納時將對本集團之經營業績及財務狀況產生任何重大影響。

2.2 子公司

2.2.1 合併

子公司指本集團有權控制的一間實體（包括結構化實體）。當本集團因參與一間實體之業務而可或有權獲得可變回報且有能力憑藉其對該實體行使權力而影響該等回報時，則視為本集團控制該實體。子公司於控制權轉移至本集團之日起全面合併入賬。子公司自控制權終止當日起終止合併入賬。

子公司的業績及權益中的非控股權益分別於合併資產負債表、合併利潤表、合併全面收益表及合併權益變動表中單獨列示。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.1 Basis of preparation (Cont’d)

(ii) New standards,amendments and interpretations that are required to be adopted by the Group after 2013 (Cont’d)

The Group has not early adopted any new standards, amendments and interpretations that have been issued but are not effective in 2013. The Group is in the process of making an assessment on the impact of these new standards, amendments and interpretations and does not anticipate that the adoption when they become effective will result in any material impact on the Group’s results of operations and financial position.

2.2 Subsidiaries

2.2.1 consolidation

A subsidiary is an entity (including a structured entity) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

F-20 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-151 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.2 子公司（續）

2.2.1 合併（續）

(i) 業務合併

本集團採用如下文所述的收購會計法為業務合併列賬，惟如上文附註2.1所述的方法入賬的重組除外。

根據收購會計法，收購一家子公司的轉讓代價包括所轉讓資產、所產生的對被收購人前所有者之負債及本集團所發行股權的公允價值。所轉讓代價亦包括任何或有對價安排所產生的資產及負債的公允價值。收購相關成本於產生時列為開支。於業務合併時所收購的可識別資產及所承擔的負債及或有負債，初始按收購日的公允價值計量。按逐項收購基準，本集團以公允價值或非控股權益按比例應佔被收購人可識別淨資產已確認金額，確認任何被收購人非控股權益。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.1 consolidation (Cont’d)

(i) Business combinations

The Group applies the acquisition method as described below to account for business combinations, except for the Reorganisation which had been accounted for as stated in Note 2.1 above.

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新城發展控股有限公司 Future Land Development Holdings Limited F-21 二零一三年年報 2013 Annual Report

– F-152 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.2 子公司（續）

2.2.1 合併（續）

(i) 業務合併（續）

已轉讓代價、於被收購人的任何非控股權益金額及任何先前於被收購人的股權於收購日期的公允價值超過所收購可識別淨資產的公允價值的差額入賬列作商譽。倘已轉讓代價、已確認非控股權益及先前已計量所持股權的總和少於議價購買情況下所收購子公司可識別淨資產的公允價值，則該差額會直接於合併利潤表內確認。

(ii) 不導致失去控制權的子公司所有權權益變動

不導致失去控制權的與非控制權益進行的交易入賬列作權益交易─即以他們作為擁有人的身份與其他擁有人進行交易。任何已付代價公允價值與所購買相關應佔子公司淨資產賬面值的差額列作權益。向非控制性權益出售產生的盈虧亦列作權益。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.1 consolidation (Cont’d)

(i) Business combinations (Cont’d)

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previously held equity interest in the acquiree over the fair value of the identifiable net assets acquired is recorded as goodwill. If the total of consideration transferred, non-controlling interest recognized and previously held equity interest measured is less than the fair value of the identifiable net assets of the subsidiary acquired as in the case of a bargain purchase, the difference is recognised directly in consolidated statement of income.

(ii) Changes in ownership interests in subsidiaries without loss of control

F-22 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-153 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.2 子公司（續）

2.2.1 合併（續）

(iii) 出售子公司

2.2.2 獨立財務報表

於本公司資產負債表中，於子公司之投資乃以成本扣除減值入賬（附註17）。成本亦包括與投資直接相關的應佔成本。子公司之業績按已收及應收股息計入公司之賬內。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.1 consolidation (Cont’d)

(iii) Disposal of subsidiaries

2.2.2 Separate financial statements

In the Company’s statement of financial position, the investments in subsidiaries are stated at cost less impairment (Note 17). Cost also includes direct attributable costs of investment. The results of subsidiaries are accounted for by the Company on the basis of dividend received and receivable.

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新城發展控股有限公司 Future Land Development Holdings Limited F-23 二零一三年年報 2013 Annual Report

– F-154 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.2 子公司（續）

2.2.2 獨立財務報表（續）

2.3 聯營公司

倘於聯營公司的所有權權益減少，而重大影響力獲保留，則先前於其他全面收益確認的金額僅有按比例部分重新劃分為損益（倘適用）。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.2 Subsidiaries (Cont’d)

2.2.2 Separate financial statements (Cont’d)

2.3 Associates

F-24 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-155 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.3 聯營公司（續）

於聯營公司投資所產生的攤薄盈虧在合併利潤表內確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.3 Associates (Cont’d)

Dilution gains and losses arising in investments in associates are recognised in the consolidated statement of income.

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新城發展控股有限公司 Future Land Development Holdings Limited F-25 二零一三年年報 2013 Annual Report

– F-156 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.4 合營安排

根據香港財務報告準則第11號，在合營安排的投資必須分類為共同經營或合營企業，視乎每個投資者的合同權益和義務而定。本集團已評估其合營安排的性質並釐定為合營企業。合營企業按權益法入賬。

根據權益法，合營企業權益初步以成本確認，其後經調整以確認本集團享有的收購后利潤或虧損以及其他綜合收益變動的份額。當本集團享有某一合營企業的虧損超過或相等於在該合營企業的權益（包括任何實質上構成本集團在該合營凈投資的長期權益)，則本集團不確認進一步虧損，除非本集團已產生義務或已代合營企業付款。

本集團與其合營企業之間的未變現交易利得按本集團在該等合營企業的權益予以對消。未變現虧損也予以對消，除非交易提供證據證明所轉讓的資產出現減值。合營企業的會計政策如有需要已改變以符合本集團採納的政策。

2.5 分部報告

管理層根據主要經營決策者審核的用於作出戰略決策的報告釐定經營分部。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.4 Joint arrangements

Under HKFRS 11, investments in joint arrangements are classified as either joint operations or joint ventures depending on the contractual rights and obligations of each investor. The Group has assessed the nature of its joint arrangements and determined them to be joint ventures. Joint ventures are accounted for using the equity method.

Under the equity method of accounting, interests in joint ventures are initially recognised at cost and adjusted thereafter to recognise the Group’s share of the post-acquisition profits or losses and movements in other comprehensive income. When the Group’s share of losses in a joint venture equals or exceeds its interests in the joint venture (which includes any long-term interests that, in substance, form part of the Group’s net investment in the joint venture), the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the joint venture.

Unrealised gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interests in the joint ventures. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of the joint ventures have been changed where necessary to ensure consistency with the policies adopted by the Group.

2.5 Segment reporting

Management has determined the operating segments based on the reports reviewed by the CODM that are used to make strategic decisions.

F-26 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-157 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.6 外幣換算

(i) 功能及呈列貨幣

(ii) 交易及結餘

與借貸及現金及現金等價物有關的匯兌收益及虧損在利潤表內的「融資收入或成本」項下呈列。所有其他匯兌收益及虧損在利潤表內的「其他收益或虧損－淨額」項下呈列。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.6 Foreign currency translation

(i) Functional and presentation currency

(ii) Transactions and balances

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the statement of income within ‘finance income or costs’. All other foreign exchange gains and losses are presented in the statement of income within ‘other gains or losses – net’.

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F-27

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-158 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.6 外幣換算（續）

(iii) 集團公司

倘本集團的所有實體（全部均非採用嚴重通脹經濟體系的貨幣）的功能貨幣有別於呈列貨幣，則其業績及財務狀況會按下列方法換算為呈列貨幣：

(a) 現時集團實體的每份資產負債表內的資產與負債按該資產負債表結算日的收市匯率換算；
(b) 現時集團實體的每份利潤表及全面收益表內的收入及開支按平均匯率換算；及
(c) 所產生的所有兌換差額乃於其他全面收益內確認及計算，並於權益項目下累積。

收購境外主體產生的商譽及公允價值調整視為該境外主體的資產和負債，並按期末匯率換算。產生的匯兌差額在其他全面收益中入賬。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.6 Foreign currency translation (Cont’d)

(iii) Group companies

(a) assets and liabilities for each statement of financial position of the Group entities are translated at the closing date of that statement of financial position;
(b) income and expenses for each statement of income and statement of comprehensive income of the Group entities are translated at average exchange rate; and
(c) all resulting exchange differences are recognised in other comprehensive income and accumulated as a separate component of equity.

F-28 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-159 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.7 物業、廠房和設備

物業、廠房和設備按歷史成本減累計折舊及任何減值虧損入賬。資產的初始成本包括購入價及令該資產處於所擬運作狀況及地點之任何直接應佔成本。

物業、廠房和設備的折舊按估計可使用年期以直線法分配其成本減其殘值，有關年限如下：

－樓宇	35年
－汽車	5-10年
－傢俬、裝置及設備	5-10年
－租賃物業裝修	3-5年

資產殘值及可使用年期均會於各報告期末時被檢討，並在適當情況下作出調整。

倘資產賬面值高於其估計可收回金額時，該項資產的賬面值將即時撇減至其可收回金額。

出售盈虧乃透過比較所得款項與賬面值而釐定，並作為「其他收益╱（虧損）-淨額」於合併利潤表中確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.7 Property, plant and equipment

Depreciation on property, plant and equipment is calculated using the straight-line method to allocate their costs less their residual values over their estimated useful lives, as follows:

– Buildings	35 years
– Motor vehicles	5-10 years
– Furniture, fittings and equipment	5-10 years
– Leasehold improvements	3-5 years

The assets’ residual value and useful life are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are recognised as “Other gains/(losses) – net” in the consolidated statement of income.

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新城發展控股有限公司 Future Land Development Holdings Limited F-29 二零一三年年報 2013 Annual Report

– F-160 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.8 投資物業

持作長期租金收入或資本增值或兩者兼備且並非本集團所佔用的物業分類為投資物業。投資物業也包括正在建造或開發供未來作投資物業使用之物業。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.8 Investment properties

F-30 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-161 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.8 投資物業（續）

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.8 Investment properties (Cont’d)

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F-31

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-162 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.9 無形資產

商標

本集團商標乃按歷史成本法列賬的單獨購入商標。商標有特定使用年限並按成本減累計攤銷列賬。攤銷乃按直線法將商標的成本分攤至10年的估計可使用年期計算。

電腦軟件

本集團的電腦軟件包括按購入及使用該特定軟件所產生的成本作資本化處理的購入電腦軟件。這些成本按五年之估計可使用年期攤銷。

2.10 於子公司、聯營公司、合營企業及非金融資產投資的減值

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.9 Intangible assets

Trademarks

Computer software

2.10 Impairment of investments in subsidiaries, associates, joint ventures and nonfinancial assets

F-32 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-163 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.11 完工待售或在建銷售物業

2.12 土地使用權

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.11 Properties held or under development for sale

2.12 Land use rights

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新城發展控股有限公司 Future Land Development Holdings Limited F-33 二零一三年年報 2013 Annual Report

– F-164 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.13 金融資產

2.13.1 分類

(i) 貸款及應收款項

貸款及應收款項為附帶固定或可釐定付款的非衍生性質金融資產，而其在活躍市場並無報價。該等金融資產計入流動資產，惟到期日超過於報告期末起計12個月的項目則被分類為非流動資產。本集團貸款及應收款項於資產負債表內包括「貿易和其他應收款項及預付款項」的若干項目及計入「現金和現金等價物」和「受限制現金」的銀行存款（附註16及附註18）。

(ii) 可供出售金融資產

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets

2.13.1 classification

(i) Loans and receivables

(ii) Available-for-sale financial assets

F-34 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-165 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.13 金融資產（續）

2.13.2 確認及計量

分類為可供出售的貨幣性及非貨幣性證券的公允價值變動在其他全面收益內確認。

當分類為可供出售的證券售出或減值時，在權益中確認的累計公允價值調整列入合併利潤表內。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets (Cont’d)

2.13.2 Recognition and measurement

Changes in the fair value of monetary and nonmonetary securities classified as available for sale are recognised in other comprehensive income.

When securities classified as available for sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the consolidated statement of income.

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新城發展控股有限公司 Future Land Development Holdings Limited F-35 二零一三年年報 2013 Annual Report

– F-166 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.13 金融資產（續）

2.13.3 金融資產減值

(i) 按攤銷成本列賬的資產

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets (Cont’d)

2.13.3 Impairment of financial assets

(i) Assets carried at amortised cost

F-36 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-167 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.13 金融資產（續）

2.13.3 金融資產減值（續）

(i) 按攤銷成本列賬的資產（續）

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets (Cont’d)

2.13.3 Impairment of financial assets (Cont’d)

(i) Assets carried at amortised cost (Cont’d)

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F-37

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-168 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.13 金融資產（續）

2.13.3 金融資產減值（續）

(ii) 分類為可供出售資產

本集團於各報告期末評估有否客觀證據顯示一項或一組金融資產出現減值。對於債務證券，本集團使用上文(i)所述標準評估。倘為可供出售的權益投資，證券公允價值顯著下跌或長期低於成本亦是資產減值的證據。倘可供出售金融資產顯示該等證據，累計虧損（即收購成本與當前公允價值減金融資產先前於損益確認之減值虧損的差額）自權益轉撥至損益確認。於合併利潤表確認的權益工具減值虧損不會通過合併利潤表撥回。倘可供出售的權益工具公允價值於其後期間增加且增加與減值虧損於損益確認後發生的事件有客觀聯繫，則減值虧損通過合併利潤表撥回。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets (Cont’d)

2.13.3 Impairment of financial assets (Cont’d)

(ii) Assets classified as available for sale

F-38 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-169 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.13 金融資產（續）

2.13.4 終止確認金融資產

金融資產（或倘適用，一項金融資產的一部分或一組相若金融資產的一部分）在下列情況下將予終止確認：

自該項資產收取現金流量的權利已屆滿；
本集團轉讓自該項資產收取現金流量的權利，或已根據一項「轉付」安排，承擔將所得現金流量全數付予第三方的責任，且不會嚴重延緩；或
本集團轉讓自該項資產收取現金流量的權利及(a)本集團已實質上轉讓該項資產的所有風險及回報；或(b)本集團並無實質上轉讓或保留該項資產的所有風險及回報，但已轉讓對該項資產的控制權。

以擔保已轉讓資產的方式繼續參與，乃按該資產的原賬面值及本集團可能被要求償還的代價最高金額（以較低者為準）計量。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.13 Financial assets (Cont’d)

2.13.4 Derecognition of financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:

the rights to receive cash flows from the asset have expired;
the Group has transferred its rights to receive cash flows from the asset, or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a “pass-through” arrangement; or
the Group has transferred its rights to receive cash flows from the asset and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

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新城發展控股有限公司 Future Land Development Holdings Limited F-39 二零一三年年報 2013 Annual Report

– F-170 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.14 抵銷金融工具

2.15 衍生金融工具

衍生工具於訂立衍生工具合約日期首次以公平值確認入賬，隨後按其公平值進行重估。公平值乃根據市場報價於活躍市場中獲得，包括近期市場交易及估值方法（包括現金流量折現模型及期權定價模型（如適用））。

對於不符合對沖會計處理的衍生金融工具，公平值變動即刻於合併利潤表中確認。

2.16 貿易和其他應收款項

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.14 Offsetting financial instruments

2.15 Derivative financial instruments

Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. Fair values are obtained from quoted market prices in active markets, including recent market transactions, and valuation techniques, including discounted cash flow models and options pricing models, as appropriate.

For derivative financial instruments which do not qualify for hedge accounting, changes in fair value are recognised in the consolidated statement of income.

2.16 Trade and other receivables

F-40 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-171 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.16 貿易和其他應收款項（續）

倘貿易和其他應收款項被視為無法收回，則與撥備賬目撇銷。其後收回先前撇銷的金額將貸記入合併利潤表內。

貿易和其他應收款項計入流動資產，惟於報告期起計超過12個月者（或倘於正常業營運週期外，則可較長），則分類為非流動資產。

2.17 現金和現金等價物

現金和現金等價物包括手頭現金、銀行通知存款及原定到期日為三個月或以內之高流動性其他短期投資。

2.18 股本

普通股分類為權益。直接歸屬於發行新股或期權的新增成本在權益中列為所得款項之減項（扣除稅項）。

2.19 貿易和其他應付款項

貿易和其他應付款項初始以公允價值確認，其後利用實際利率法按攤銷成本計量。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.16 Trade and other receivables (Cont’d)

2.17 cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less.

2.18 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.

2.19 Trade and other payables

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

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新城發展控股有限公司 Future Land Development Holdings Limited F-41 二零一三年年報 2013 Annual Report

– F-172 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.20 借款及借貸成本

除非本集團有權無條件將債務結算日期遞延至報告期後至少12個月，否則借款將被劃分為流動負債。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.20 Borrowings and borrowing costs

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

F-42 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-173 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.21 即期及遞延所得稅

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.21 current and deferred income tax

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新城發展控股有限公司 Future Land Development Holdings Limited F-43 二零一三年年報 2013 Annual Report

– F-174 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.21 即期及遞延所得稅（續）

遞延所得稅資產是就可能有未來應課稅利潤而就此可使用暫時性差額而確認。

遞延所得稅乃就於子公司、聯營公司及合營安排的投資產生的暫時差額而撥備，惟倘本集團可控制暫時差額撥回的遞延所得稅負債時間，且暫時差額有可能在可預見將來不會獲撥回則除外。一般而言，本集團無法控制給予聯營公司的暫時差額撥回。僅於有協議賦予本集團能力控制撥回未確認暫時差額時除外。

因投資子公司、聯營公司及共同控制實體而產生的可扣減暫時差額確認為遞延所得稅資產，惟倘暫時差額在將來可撥回，且有充足應課稅溢利抵銷可動用暫時差額則除外。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.21 current and deferred income tax (Cont’d)

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred income tax is provided on temporary differences arising on investments in subsidiaries, associates and joint arrangements, except for deferred income tax liability where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Generally the Group is unable to control the reversal of the temporary difference for associates. Only where there is an agreement in place that gives the Group the ability to control the reversal of the temporary difference are not recognised.

Deferred income tax assets are recognised on deductible temporary differences arising from investments in subsidiaries, associates and joint arrangements only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the temporary difference can be utilised.

F-44 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-175 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.22 員工福利

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.22 Employee benefits

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F-45

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-176 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.23 以股份為基礎的支付

包括任何市場業績條件；
不包括任何服務及非市場業績可行權條件的影響；及
包括任何非可行權條件的影響。

非市場績效歸屬條件包括在有關預期歸屬的股份數目的假設中。列作開支的總金額乃在歸屬期確認，歸屬期即符合所有特定歸屬情況的期間。於各報告期末，本集團會根據非市場績效歸屬條件修改其估計預期將歸屬的股份數目。於合併利潤表內確認修改原來估計數字（如有）的影響，以及須對權益作出的相應調整。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.23 Share-based payments

i n c l u d i n g a n y m a r k e t p e r f o r m a n c e conditions;
excluding the impact of any service and non-market performance vesting conditions; and
including the impact of any non-vesting conditions.

F-46 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-177 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.23 以股份為基礎的支付（續）

2.24 撥備及或有負債

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.23 Share-based payments (Cont’d)

2.24 Provisions and contingent liabilities

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新城發展控股有限公司 Future Land Development Holdings Limited F-47 二零一三年年報 2013 Annual Report

– F-178 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.24 撥備及或有負債（續）

或有負債乃一項因過往事件可能產生的責任，而該責任的存在僅可由一項或多項並非由本集團全權控制之日後不明朗事件之存在與否確定。或有負債亦可為因不大可能需要動用經濟資源或承擔之金額未能可靠地估量而未確認之過往事件產生之現有承擔。

或有負債不予確認，但會於合併財務報表附註中披露。倘支付之可能性出現變動致使有可能需支付，則或有負債將確認為撥備。

2.25 收入確認

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.24 Provisions and contingent liabilities (Cont’d)

2.25 Revenue recognition

F-48 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-179 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.25 收入確認（續）

(i) 出售物業

(ii) 租金收入

來自經營租賃所出租物業的租金收入，以直線法在租賃期內確認。

(iii) 服務收入

服務收入於相關的提供服務已提供，並能夠可靠地估計收入及成本總額，且能合理確保收回有關應收款項時確認。

(iv) 利息收入

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.25 Revenue recognition (Cont’d)

(i) Sales of properties

(ii) Rental income

Rental income from properties being let under operating leases is recognised on a straight line basis over the lease terms.

(iii)

Service income

(iv)

Interest income

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新城發展控股有限公司 Future Land Development Holdings Limited F-49 二零一三年年報 2013 Annual Report

– F-180 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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2 重大會計政策概要（續）

2.25 收入確認（續）

(v) 股息收入

股息收入在收取股息之權利獲確定時確認。

2.26 政府補貼

2.27 財務擔保負債

本集團就銀行按揭信貸為若干購房者提供財務擔保。

財務擔保負債當且僅當合約列明的責任已解除或註銷或屆滿時方於資產負債表中終止確認。

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.25 Revenue recognition (Cont’d)

(v) Dividend income

Dividend income is recognised when the right to receive payment is established.

2.26 Government grants

2.27 Financial guarantee liabilities

The Group provides financial guarantees for certain property purchasers on mortgage facilities with banks.

Financial guarantee liabilities are derecognised from the statement of financial position when, and only when, the obligation specified in the contract is discharged or cancelled or expired.

F-50 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-181 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

2 重大會計政策概要（續）

2.28 經營租賃

出租人保留所有權的絕大部分風險及回報的租賃均列為經營租賃。根據經營租賃支付的款項（扣除自出租人收取之任何獎勵金後），於租賃期內以直線法自合併利潤表扣除。

2.29 股息分派

向本公司股東分派的股息於股息獲本公司股東正式批准的期間在本集團及本公司財務報表中確認，並在適用時作為負債入賬。

2.30 結算日後事項

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)

2.28 Operating leases

2.29 Dividend distribution

2.30 Subsequent events

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F-51

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-182 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

3 財務風險管理

3.1 市場風險

(i) 外匯風險

除部分融資活動（包括首次公開發售、銀行借貸及發行優先票據乃以港元（「港元」）或美元（「美元」）計值）外，本集團僅於中國從事房地產的開發、銷售及管理，幾乎所有交易均以人民幣計值。於2013年12月31日，本集團主要的資產及負債以人民幣計值，惟若干現金及借款以港元或美元計值。

本公司及其全部子公司的功能貨幣為人民幣。因此，以港元或美元計值的現金及借款面臨外匯風險。港元及美元兌人民幣的匯率波動將影響本集團的經營業績。本集團目前並無外匯對沖政策。然而，管理層密切監控外匯風險並於必要時採取行動。

於2013年12月31日，如人民幣兌港元及美元升值╱貶值5%，而所有其他可變因素維持不變，年度除稅後溢利將上升╱下降人民幣 47,647,000元（2012年：人民幣12,052,000 元），主要因為換算以港元及美元計值的銀行結餘及借貸的凈外匯收益╱虧損所致。

3 FINANCIAL RISK MANAGEMENT

3.1 Market risk

(i) Foreign exchange risk

The Group is engaged in the development, sale and management of properties solely in the PRC with almost all the transactions denominated in RMB, except for certain financing activities, including the initial public offering, borrowings from banks and issuance of senior notes which are denominated in Hong Kong Dollar (“HKD”) or United States Dollar (“USD”). As of 31 December 2013, majority of the Group’s assets and liabilities are denominated in RMB except that certain cash and borrowings are denominated in HKD or USD.

The Company and all of its subsidiaries’ functional currency is RMB. Accordingly, cash and borrowings denominated in HKD or USD is subject to foreign exchange risk. Fluctuations in the exchange rates of HKD and USD against RMB will affect the Group’s result of operations. The Group currently does not have a foreign currency hedging policy. However, management closely monitors the foreign exchange exposure and will take actions when necessary.

As at 31 December 2013, if RMB had strengthened/weakened by 5%, against HKD and USD with all other variables held constant, post-tax profit for the year would have been RMB47,647,000 (2012: RMB12,052,000) higher/lower, mainly as a result of net foreign exchange gains/losses on translation of HKD and USD denominated bank deposits and borrowings.

F-52 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-183 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

3 財務風險管理（續）

3.1 市場風險（續）

(ii) 價格風險

由於本集團所持投資在合併資產負債表內被分類為可供出售金融資產，故本集團承受價格風險。

下表概述分類為可供出售股本證券的公允價值上升╱下跌5%，該證券收益╱虧損對本集團其他全面收益增加╱減少的影響。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.1 Market risk (Cont’d)

(ii) Price risk

The Group is exposed to price risk because of investments held by the Group and classified on the consolidated statements of financial position as available-for-sale financial assets.

截至12月31日止年度 Year ended 31 December

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					2013年	2012年
					2013	2012
					人民幣千元	人民幣千元
					RMB’000	RMB’000
－上調5%	–	5	percent	higher	8,295	6,795
－下調5%	–	5	percent	lower	(8,295)	(6,795)

F-53

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-184 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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3 財務風險管理（續）

3.1 市場風險（續）

(iii) 現金流量和公允價值利率風險

除銀行現金存款外，本集團並無其他重大計息資產。

本集團承受的利率變動風險主要來自借款。浮息借款使本集團承受現金流量利率風險。固息借款則令本集團承受公允價值利率風險。本集團並無對沖其現金流量或公允價值利率風險。利率及償還借款的條款於附註22 披露。

由於預期銀行存款的利率不會出現大幅波動，管理層預期利率變動不會對計息資產產生重大影響。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.1 Market risk (Cont’d)

(iii) Cash flow and fair value interest rate risk

Except for cash deposits in the bank, the Group has no other significant interestbearing assets.

The Group’s exposure to changes in interest rates is mainly attributable to its borrowings. Borrowings at variable rates expose the Group to cash flow interest rate risk. Borrowings at fixed rates expose the Group to fair value interest rate risk. The Group has not hedged its cash flow or fair value interest rate risk. The interest rate and terms of repayments of borrowings are disclosed in Note 22.

F-54 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-185 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.1 市場風險（續）

3.1 Market risk (Cont’d)

(iii) 現金流量和公允價值利率風險（續）

(iii) Cash flow and fair value interest rate risk (Cont’d)

於2013年和2012年12月31日，倘浮息借款利率上調╱下調50個基點，而所有其他變量保持不變，則本集團截至2013年和2012年12月 31日止年度的除稅後利潤和資本化利息變動如下：

As at 31 December 2013 and 2012, if interest rates on borrowings at floating rates had been 50 basis points higher/lower with all other variables held constant, the posttax profit and capitalised interest of the Group for the years ended 31 December 2013 and 2012 would have changed as follows:

截至12月31日止年度 Year ended 31 December

		2013年 2012年 2013 2012 RMB’000 RMB’000 人民幣千元人民幣千元
除稅後利潤增加╱（減少）	Post-tax profit increase/(decrease)
－上調50個基點	– 50 basis points higher	(6,361) (4,814)
－下調50個基點	– 50 basis points lower	6,361 4,814
資本化利息增加╱（減少）	Capitalised interest increase/(decrease)
－上調50個基點	– 50 basis points higher	35,379 26,246
－下調50個基點	– 50 basis points lower	(35,379) (26,246)

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F-55

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-186 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.2 信貸風險

3.2 credit risk

本集團並無重大集中信貸風險。合併資產負債表中列示的銀行存款和貿易和其他應收款項賬面值指本集團就其金融資產承受的最大信貸風險。

現金交易限於信貸質量較高的金融機構。下表載列於 2013年和2012年12月31日的銀行存款結餘：

Cash transactions are limited to high-credit-quality financial institutions. The table below shows the bank deposit balances as at 31 December 2013 and 2012:

			於12月31日	於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
交易對手	counter	party	人民幣千元 RMB’000	人民幣千元 RMB’000
於中國四大國有銀行的存款	Deposits	in the four major state-owned
	banks	of the PRC	6,901,344		3,761,048
於中國其他上市銀行的存款	Deposits	in other listed banks of the PRC	870,278		1,327,230
於其他銀行的存款	Deposits	in other banks	521,408		899,831
			8,293,030		5,988,109

管理層預期不會因該等交易對手的不履約行為而產生任何虧損。

Management does not expect any losses from nonperformance of these counterparties.

F-56 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-187 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

3 財務風險管理（續）

3.2 信貸風險（續）

其他應付款項主要包括於日常業務過程中應收關連方款項和按金。本集團密切監控這些其他應收款項以確保在面臨違約的風險時採取行動收回結餘。

3.3 流動資金風險

本集團管理層旨在從內部銷售所得款項及充足的承諾信貸融資維持足夠現金以滿足其物業項目的營運需求和承諾。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.2 credit risk (Cont’d)

3.3 Liquidity risk

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F-57

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-188 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.3 信貸風險（續）

3.3 Liquidity risk (Cont’d)

下表乃根據於2013年及2012年12月31日至合同到期日的剩餘期間，按相關到期組別分析本集團金融負債。表內披露的金額為合同未貼現現金流量。

The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period as at 31 December 2013 and 2012 to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

		一年以內	一至二年	二至五年	五年以上	合計
			Between	Between
		Within	1 and 2	2 and 5	Over
		1 year	years	years	5 years	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
於2013年12月31日	As at 31 December 2013
借款本金（附註22）	Borrowings, principal (Note 22)	2,174,501	4,043,500	6,983,880	740,000	13,941,881
支付借款利息	Interest payments on borrowings	976,258	764,017	647,021	83,629	2,470,925
貿易和其他應付款項	Trade and other payables	10,007,801	–	–	–	10,007,801
應付股息	Dividends payable	929	–	–	–	929
有關購買本集團物業而獲授	Guarantees in respect of mortgaged
按揭額度的擔保（附註37） facilities granted to purchasers of
	the Group’s properties (Note 37)	2,783,155	197,561	–	–	2,980,716
		15,942,644	5,005,078	7,630,901	823,629	29,402,252
於2012年12月31日	As at 31 December 2012
借款本金（附註22）	Borrowings, principal (Note 22)	5,130,436	2,700,670	1,359,000	450,000	9,640,106
支付借款利息	Interest payments on borrowings	586,905	261,389	201,499	67,328	1,117,121
貿易和其他應付款項	Trade and other payables	9,388,569	–	–	–	9,388,569
應付股息	Dividends payable	805	–	–	–	805
有關購買本集團物業而獲授	Guarantees in respect of mortgaged
按揭額度的擔保（附註37） facilities granted to purchasers of
	the Group’s properties (Note 37)	3,261,710	731,975	–	–	3,993,685
		18,368,425	3,694,034	1,560,499	517,328	24,140,286

附註：借款利息沒有考慮到未來借貸，並且根據2013年和2012年12月 31日所持借款計算。浮動利息分別使用2013年和2012年12月31 日的當時利率估算。

Note: The interest on borrowings is calculated based on borrowings held as at 31 December 2013 and 2012 without taking into account future borrowings. Floatingrate interests are estimated using the current interest rate as at 31 December 2013 and 2012, respectively.

F-58 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-189 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

3 財務風險管理（續）

3.3 信貸風險（續）

鑒於相關業務的動態性質，本集團的管理層會密切監控流動資金的風險並採取以下措施管理流動資金風險：
i) 編製年度現金流量預測並按月更新該預測以反映最新變化及密切監控流動資金風險；
ii) 與主要銀行和其他金融機構保持戰略合作關係以在適當時取得信貸額度；
iii) 繼續取得長期融資信貸、附有抵押本集團物業的主要發行優先票據、項目銀行貸款或本集團視為適當的其他資金來源；
iv) 積極推動銷售本集團竣工物業及預售在建物業。本集團亦會考慮靈活調整價格和銷量以管理流動資金風險。

3.4 資本風險管理

本集團的資本管理的目標乃為保障本集團能繼續營運，以為股東提供回報和維持最佳的資本結構以降低資金成本。

為維持或調整資本結構，本集團可能會調整支付予股東的股息金額、發行新股或出售資產以減少債務。

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.3 Liquidity risk (Cont’d)

Due to dynamic nature of the underlying business, the management of the Group is closely monitoring the risk of the liquidity and takes the following actions to manage the liquidity risk:

i) prepares annual cash flow forecast and updates such forecast on a monthly basis to reflect the latest changes and monitor the liquidity risk closely;
ii) maintains strategic cooperation with major banks and other financial institutions to secure credit facilities where appropriate;
iii) continues to obtain longer term financing facilities, mainly issuance of senior notes, project bank loans with pledge of the Group’s properties or other resources of funding which the Group considers appropriate;
iv) proactively promotes the sales of the Group’s completed properties and pre-sales of properties under development. The Group also considers the flexibility of adjusting the price and volume on sale of properties for management of liquidity risk.

3.4 capital risk management

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, issue new shares or sell assets to reduce debt.

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新城發展控股有限公司 Future Land Development Holdings Limited F-59 二零一三年年報 2013 Annual Report

– F-190 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

3 財務風險管理（續）

3 FINANCIAL RISK MANAGEMENT (Cont’d)

3.4 資本風險管理（續）

3.4 capital risk management (Cont’d)

於2013年和2012年12月31日，本集團資產負債比率如下：

The gearing ratios of the Group at 31 December 2013 and 2012 were as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
借款總額	Total borrowings	13,889,576		9,640,106
減：現金和現金等價物	Less: Cash and cash equivalents	(7,411,713)	(4,852,130)
債務淨額	Net debt	6,477,863		4,787,976
權益總額	Total equity	10,597,959		8,395,027
資本總額	Total capital	17,075,822	13,183,003
資產負債比率	Gearing ratio	38%		36%

The increase in the gearing ratio as at 31 December 2013 resulted primarily from the increase in the balance of total borrowings.

資產負債比率於2013年12月31日增加，主要原因是借貸總額的結餘增加。

F-60 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-191 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

4 公允價值估計

下表利用估值法分析按公允價值入賬的金融工具。不同層級的定義如下：

－相同資產或負債的活躍市場報價（未經調整）
（第一層）。
－除第一層所包括的報價外，資產或負債的可直接（即如價格）或間接（即價格衍生物）觀察的輸入值（第二層）。
－並非依據可觀察的市場數據而釐定的資產或負債的輸入值（即不可觀察輸入值）（第三層）。

本集團可供出售金融資產通過第三層按公允價值計量。

下表分別呈列本集團於2013年和2012年12月31日按公允價值計量的金融資產。請參閱附註8就投資物業按公允價值計量所作的披露。

4 FAIR VALUE ESTIMATION

The table below analyses financial instruments carried at fair value by valuation method. The different levels have been defined as follows:

Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2).
Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).

The available-for-sale financial assets of the Group are measured at fair value by Level 3.

The following table presents the Group’s financial assets that are measured at fair value at 31 December 2013 and 2012 respectively. See Note 8 for disclosures of the investment properties that are measured at fair value.

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		第一層	第二層	第三層	合計
		Level 1	Level 2	Level 3	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
可供出售金融資產	Available-for-sale financial assets
於2013年12月31日	At 31 December 2013	–	–	221,187	221,187

於2012年12月31日	At 31 December 2012	–	–	181,187	181,187

截至2013年和2012年12月31日止年度第三層工具出現的變動載於附註12。

The changes in Level 3 instruments for the years ended 31 December 2013 and 2012 are presented in Note 12.

新城發展控股有限公司 Future Land Development Holdings Limited F-61 二零一三年年報 2013 Annual Report

– F-192 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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4 公允價值估計（續）

在活躍市場中交易的金融工具之公允價值是以於資產負債表日的市場報價列賬。如果該報價可以容易地及規律地從交易市場、經銷商、經紀人、產業集團、股價服務機構或管理機構中獲得，並且這些報價是在真實、公平市場交易的基礎上定期呈現，該市場會被視為活躍。該工具計入第一層。

倘一項或多項重要參數並非基於可觀察市場數據，則該工具計入第三層。

4 FAIR VALUE ESTIMATION (Cont’d)

If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3.

F-62 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-193 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

5 重大會計估計及判斷

5.1 直接應佔物業開發活動的開發成本

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

5.1 Development costs directly attributable to property development activities

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新城發展控股有限公司 Future Land Development Holdings Limited F-63 二零一三年年報 2013 Annual Report

– F-194 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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5 重大會計估計及判斷（續）

5.2 完工待售或在建銷售物業的減值撥備

5.3 中國土地增值稅

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.2 Provision for impairment of properties held or under development for sale

5.3 Land appreciation tax of the PRc

F-64 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-195 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

5 重大會計估計及判斷（續）

5.4 即期及遞延所得稅

5.5 投資物業的公允價值

投資物業的公允價值乃採用估值方法釐定。有關判斷及假設已披露於附註8。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.4 current and deferred income tax

5.5 Fair value of investment properties

The fair value of investment properties is determined by using valuation techniques. Details of the judgement and assumptions have been disclosed in Note 8.

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F-65

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-196 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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5 重大會計估計及判斷（續）

5.6 子公司、合營企業及聯營公司的分類

在正常業務過程中，本集團透過與其他發展商或機構訂立合作協議而與該等人士發展物業。本集團與其他各方的權利和義務在項目公司的相關合作協議、組織章程等訂明。由於安排複雜，故確定項目公司是否本集團子公司、合資公司或聯營公司需作出重大判斷。

本集團根據安排的實質內容及附註2.2、2.3及2.4披露子公司、合資企業及聯營公司的定義而作出判斷。

5.7 合營安排

本集團持有其合營安排的50%投票權。由於根據合約協議，全部相關活動須取得協議各方之一致同意，故此本集團對此項安排擁有共同控制權。

本集團合營安排的形式為有限公司，當中規定本集團及協議各方有權享有該等安排項下有限公司之資產淨值。因此，此項安排被歸類為合營企業。

5 CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (Cont’d)

5.6 classification of subsidiary, joint venture and associate

In the normal course of business, the Group develops properties together with other developers or institutions, through entering into co-operation agreements with these parties. The rights and obligations of the Group and the other parties are stipulated by respective co-operation agreements, article of associations of the project companies, etc. Because of the complexity of the arrangements, significant judgement is needed in determining whether the project company is subsidiary, joint venture or associate of the Group.

The Group makes judgement based on the substance of the arrangements and the definition of subsidiary, joint venture and associate as disclosed in Notes 2.2, 2.3 and 2.4.

5.7 Joint arrangements

The Group holds 50% of the voting rights of its joint arrangement. The Group has joint control over this arrangement as under the contractual agreements, unanimous consent is required from all parties to the agreements for all relevant activities.

The Group’s joint arrangement is structured as a limited company and provides the Group and the parties to the agreements with rights to the net assets of the limited company under the arrangements. Therefore, this arrangement is classified as a joint venture.

F-66 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-197 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

6 分部資料

管理層根據主要經營決策者審核的報告（用於作出戰略決策）釐定營運分部。王董事長被視為主要經營決策者。

本集團通過兩個營運分部管理業務，這與就資源分配和業績評估向本集團主要經營決策者內部呈報信息的方式一致。概無合併營運分部以形成以下可呈報分部：

江蘇新城地產股份有限公司，一家其境內上市外資股於上海證券交易所上市的公司（「B 股公司」）。
不屬於B股公司的物業項目（「非B股公司」）。

6 SEGMENT INFORMATION

Management has determined the operating segments based on the reports reviewed by the CODM that are used to make strategic decisions. The chairman, Mr. Wang has been identified as the CODM.

Jiangsu Future Land Co., Ltd., a company listed on the Shanghai Stock Exchange with domestically listed foreign investment shares (the “B share company”).
Property projects not within the B share company (the “Non-B share companies”).

The B share company is mainly engaged in development of residential properties, while the Non-B share companies are mainly engaged in development of mixed-use complexes. All the property development projects are in the PRC, and accordingly majority of the revenue of the Group are derived from the PRC and most of the assets are located in the PRC.

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新城發展控股有限公司 Future Land Development Holdings Limited F-67 二零一三年年報 2013 Annual Report

– F-198 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

6 分部資料（續）

6 SEGMENT INFORMATION (Cont’d)

截至2013年12月31日止年度 Year ended 31 December 2013

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	B股公司非B股公司分部合計對銷本集團合計 B share company Non-B share companies Total segment Elimination Total Group 人民幣千元人民幣千元人民幣千元人民幣千元人民幣千元 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
分部收入	Segment revenue 16,583,969 4,188,605 20,772,574 (1,319) 20,771,255
除投資物業公允價值	Segment profit before fair value
收益和所得稅開支	gains on investment properties
前分部利潤財務收入	and income tax expense 2,973,596 318,804 3,292,400 (93,773) 3,198,627 Finance income 52,466 69,327 121,793 – 121,793
融資成本	Finance costs (66,254) (450,439) (516,693) – (516,693)
折舊和攤銷應佔聯營公司業績	Depreciation and amortisation (16,371) (5,500) (21,871) – (21,871) Share of results of an associated company (11,422) – (11,422) – (11,422)

年度利潤對賬如下：

A reconciliation to profit for the year is as follows:

對銷後除投資物業	Total segment profits before
公允價值收益和	fair value gains on investment
所得稅開支前的	properties and income tax
分部利潤總額	expense after elimination	3,198,627
投資物業公允價值收益	Fair value gains on investment
	properties	37,839
所得稅開支	Income tax expense	(1,519,329)
年度利潤	Profit for the year	1,717,137

於2013年12月31日

As at 31 December 2013

分部資產 Segment assets	33,886,077 13,334,828 47,220,905 (22,695) 47,198,210

分部資產包括： Segment assets include: 於聯營公司的投資 Investments in associates 於合資企業的投資 Investment in a joint venture 添置非流動資產（除金融工具和遞延稅項資產） Additions to non-current assets (other than financial instruments and deferred tax assets)
	43,468 – 43,468 – 43,468
	10,000 – 10,000 – 10,000
	29,933 173,046 202,979 – 202,979

分部負債 Segment liabilities	27,005,135 9,617,811 36,622,946 (22,695) 36,600,251

F-68 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-199 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

6 分部資料（續） 6 SEGMENT INFORMATION (Cont’d)

6 分部資料（	續）	6	SEGMENT INFORMATION(Co	SEGMENT INFORMATION(Co	SEGMENT INFORMATION(Co	nt’d)
			截至2012年12月31日止年度
			Year ended 31 December 2012
		B股公司	非B股公司	分部合計	對銷	本集團合計
		B share	Non-B share	Total
		company	companies	segment	Elimination	Total Group
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
分部收入	Segment revenue	14,300,447	3,221,061	17,521,508	(4,242)	17,517,266
除投資物業公允價值	Segment profit before fair value
收益和所得稅開支	gains on investment properties
前的分部利潤總額	and income tax expense	2,336,309	497,652	2,833,961	(46,886)	2,787,075
財務收入	Finance income	39,759	8,293	48,052	–	48,052
融資成本	Finance costs	(51,199)	(108,513)	(159,712)	–	(159,712)
折舊和攤銷	Depreciation and amortisation	(15,458)	(6,050)	(21,508)	–	(21,508)
應佔聯營公司業績	Share of results of
	an associated company	(5,110)	–	(5,110)	–	(5,110)
年度利潤對賬如下：			A reconciliation to profit for the year is as follows:
對銷後除投資物業	Total segment profits before
公允價值收益和	fair value gains on investment
所得稅開支前的	properties and income tax
分部利潤總額	expense after elimination					2,787,075
投資物業公允價值收益	Fair value gains on
	investment properties					31,086
所得稅開支	Income tax expense					(1,232,777)
年度利潤	Profit for the year					1,585,384
				於2012年12月31日
			As	at 31 December 2012
分部資產	Segment assets	29,280,647	11,581,191	40,861,838	(18,295)	40,843,543
分部資產包括：	Segment assets include:
於聯營公司的投資	Investments in associates	229,890	–	229,890	–	229,890
添置非流動資產	Additions to non-current assets
（除金融工具和	(other than financial
遞延稅項資產）	instruments and
	deferred tax assets)	15,590	640,106	655,696	–	655,696
分部負債	Segment liabilities	23,904,212	8,562,599	32,466,811	(18,295)	32,448,516

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新城發展控股有限公司 Future Land Development Holdings Limited F-69 二零一三年年報 2013 Annual Report

– F-200 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

7 物業、廠房和設備 7 PROPERTY, PLANT AND EQUIPMENT

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本集團

Group

				傢俬、裝置	租賃
		樓宇	汽車	及設備	物業裝修	合計
				Furniture,
			Motor	fittings and	Leasehold
		Buildings	vehicles	equipment	improvements	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
於2013年1月1日成本	At 1 January 2013 Cost	59,320	29,297	37,152	48,946	174,715
累計折舊	Accumulated depreciation	(6,307)	(13,166)	(14,881)	(23,287)	(57,641)
賬面淨值	Net book value	53,013	16,131	22,271	25,659	117,074
截至2013年12月31日	Year ended 31 December 2013
止年度
年初賬面淨值添置	Opening net book amount Additions	53,013 –	16,131 12,221	22,271 12,884	25,659 9,326	117,074 34,431
出售（附註35）折舊費用（附註28）	Disposals (Note 35) Depreciation charge (Note 28)	(113) (1,895)	(1,121) (2,538)	(397) (6,917)	(14,412) (8,103)	(16,043) (19,453)
年末賬面淨值	Closing net book amount	51,005	24,693	27,841	12,470	116,009
於2013年12月31日	At 31 December 2013
成本	Cost	59,138	37,024	46,998	32,620	175,780
累計折舊	Accumulated depreciation	(8,133)	(12,331)	(19,157)	(20,150)	(59,771)
賬面淨值	Net book value	51,005	24,693	27,841	12,470	116,009
於2012年1月1日	At 1 January 2012
成本	Cost	59,805	28,983	27,104	39,621	155,513
累計折舊	Accumulated depreciation	(4,555)	(10,876)	(9,783)	(13,283)	(38,497)
賬面淨值	Net book value	55,250	18,107	17,321	26,338	117,016
截至2012年12月31日	Year ended 31 December 2012
止年度
年初賬面淨值	Opening net book amount	55,250	18,107	17,321	26,338	117,016
添置	Additions	–	859	10,741	9,325	20,925
出售（附註35）	Disposals (Note 35)	(327)	(92)	(471)	–	(890)
折舊費用（附註28）	Depreciation charge (Note 28)	(1,910)	(2,743)	(5,320)	(10,004)	(19,977)
年末賬面淨值	Closing net book amount	53,013	16,131	22,271	25,659	117,074
於2012年12月31日	At 31 December 2012
成本	Cost	59,320	29,297	37,152	48,946	174,715
累計折舊	Accumulated depreciation	(6,307)	(13,166)	(14,881)	(23,287)	(57,641)
賬面淨值	Net book value	53,013	16,131	22,271	25,659	117,074

截至2013年及2012年12月31日止年度，本集團物業、廠房和設備的折舊費用已悉數計入行政開支或營銷成本。

The Group’s depreciation charges of property, plant and equipment have all been included in administrative expenses or selling and marketing costs for the years ended 31 December 2013 and 2012.

於2013年12月31日，賬面總值為人民幣42,332,000 元（2012年：無）的物業、廠房和設備已抵押作本集團借款的抵押品（附註22）。

Property, plant and equipment with a total carrying amount of RMB42,332,000 as at 31 December 2013 (2012: Nil) were pledged as collateral for the Group’s borrowings (Note 22).

F-70 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-201 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

8 投資物業 8 INVESTMENT PROPERTIES

8 投資物業	8	INVESTMEN	T PROPERTIE	S
		竣工	開發中	合計
			Under
		completed	development	Total
		人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000
於2013年1月1日添置	At 1 January 2013 Additions	3,105,600 35,736	– 127,825	3,105,600 163,561
公允價值收益	Fair value gains	9,664	28,175	37,839
於2013年12月31日	At 31 December 2013	3,151,000	156,000	3,307,000
於2012年1月1日	At 1 January 2012	4,200	2,439,000	2,443,200
添置	Additions	–	631,314	631,314
項目竣工(a)	Completion of projects (a)	3,070,314	(3,070,314)	–
公允價值收益	Fair value gains	31,086	–	31,086
於2012年12月31日	At 31 December 2012	3,105,600	–	3,105,600

(a) 用作投資物業的部份吾悅廣場一期及吾悅國際廣場已分別於2012年3月及12月竣工。

(a) The portion of Phase I of Injoy Plaza and Injoy International Plaza used as investment properties were completed in March and December 2012, respectively.

截至2013年12月31日止年度，概無撥入投資物業的資本化借貸成本（2012年：人民幣80,006,000元，資本化率為11.06%）。

No borrowing costs were capitalised in investment properties for the year ended 31 December 2013 (2012: RMB80,006,000 with capitalisation rate of 11.06%).

公允價值分層

Fair value hierarchy

本集團所有投資物業的公允價值均以第三層計量，有重大不可觀察輸入資料。

Fair value of all of the Group’s investment properties are measured at Level 3, with significant unobservable inputs.

年內並無在第一、二及三層之間轉移。

There were no transfers between Level 1, 2 and 3 during the year.

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新城發展控股有限公司 Future Land Development Holdings Limited F-71 二零一三年年報 2013 Annual Report

– F-202 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

使用重大不可觀察輸入值（第3層）進行公允價值計量

Fair value measurements using significant unobservable inputs (Level 3)

		IP1	IP2	IP3	其他	合計
		IP1	IP2	IP3	Other	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
期初結餘	Opening balance	1,685,000	1,416,400	–	4,200	3,105,600
添置	Additions	–	–	127,825	–	127,825
資本化其後開支	Capitalised subsequent expenditure	–	35,736	–	–	35,736
來自公允價值	Net gains from fair value adjustment	5,000	4,664	28,175	–	37,839
調整的淨收益
期末結餘	Closing balance	1,690,000	1,456,800	156,000	4,200	3,307,000

本集團的估值過程

Valuation processes of the Group

所有投資物業於2013年及2012年12月31日由獨立專業合資格估值師戴德梁行有限公司進行重估。

All investment properties were revalued as at 31 December 2013 and 2012 by DTZ Debenham Tie Leung Limited, and independent professional qualified valuer.

本集團的財務部將會審閱獨立估值師所進行的估值，包括：

The Group’s finance team will review the valuation performed by the independent valuers, including:

查核獨立估值報告內的所有重要輸入值；
verifies all major inputs to the independent valuation report;
與上一年度的估值報告進行比較時評估物業估值變動；
assesses property valuation movements when compared to the prior year valuation report;
與獨立估值師進行討論。
holds discussions with independent valuers.

F-72 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-203 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

8 投資物業（續）

估值方法

本集團的投資物業主要包括吾悅國際廣場的部份物業（「IP1」）、吾悅廣場一期的部份物業（「IP2」）及吳江吾悅廣場三期的部分物業（「IP3」）。IP1及IP2均位於中國江蘇省常州市並分別於2012年12月及3月竣工。IP3位於中國江蘇省蘇州市，將於2015年底前竣工。IP1、IP2和IP3的總建築面積分別為142,556平方米（包括39,879平方米的車庫）、163,526平方米（包括21,300平方米的車庫）以及171,651平方米（包括 62,450平方米的車庫及地下配套設施）。

年內估值方法並無變動。

8 INVESTMENT PROPERTIES (Cont’d)

Valuation techniques

The Group’s investment properties comprise mainly a portion of Injoy International Plaza (“IP1”), a portion of Phase I of Injoy Plaza (“IP2”) and a portion of Phase III of Wujiang Injoy Plaza (“IP3”). IP1 and IP2 are both located in Changzhou, Jiangsu Province, the PRC, and were completed in December and March 2012, respectively. IP3 is located in Suzhou, Jiangsu Province, the PRC, and will be completed by end of 2015. Total gross floor area of IP1, IP2 and IP3 are 142,556 square meters (including carparks of 39,879 square metres), 163,526 square meters (including carparks of 21,300 square metres) and 171,651 square meters (including carparks and underground ancillaries of 62,450 square metres) respectively.

There were no changes to the valuation techniques during the year.

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新城發展控股有限公司 Future Land Development Holdings Limited F-73 二零一三年年報 2013 Annual Report

– F-204 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

有關使用重大不可觀察輸入值（第3層）進行公允價值計量的資料：

Information about fair value measurements using significant unobservable inputs (Level 3):

於2013年 12月31日不可觀察輸入值與說明的公平值估值方法不可觀察輸入值不可觀察輸入值（加權平均數）的範圍公允價值的關係 Fair value at 31 December 2013 Relationship of （人民幣千元） Valuation Unobservable Range of unobservable inputs unobservable Description (RMB’000) technique(s) inputs (weighted average) inputs to fair value IP1 1,690,000 投資法租期收益率經計及可資比較物業的收益率及反租期收益率越高， Investment Term yield 映所擔保及將收取租期收入的確公允價值越低 approach 定性的調整，租期收益率為4.5%The higher the term yield, the 5.5%(5.4%)。 lower the fair value Term yield of 4.5%-5.5% (5.4%), taking into account of yield generated from comparable properties and adjustment to reflect the certainty of term income secured and to be received. 復歸收益率經計及可資比較物業的年度單位市場復歸收益率越高， Reversionary yield 租金收入及單位市場價值，復歸收公允價值越低益率為5.5%-6.5%(6.4%)。 The higher the reversionary Reversionary yield of 5.5%-6.5% yield, the lower the fair (6.4%), taking into account annual value unit market rental income and unit market value of the comparable properties.

各單位的市場單位每月人民幣50元╱平方米至每月人民市場單位租金越高，租金幣317元╱平方米。（每月人民幣96 公允價值越高 Market unit rent 元╱平方米） The higher the market unit of individual unit RMB50 – RMB317 per square meter rent, the higher the fair per month (RMB 96 per square value meter per month)

F-74 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-205 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

於2013年 12月31日不可觀察輸入值與說明的公平值估值方法不可觀察輸入值不可觀察輸入值（加權平均數）的範圍公允價值的關係 Fair value at 31 December 2013 Relationship of （人民幣千元） Valuation Unobservable Range of unobservable inputs unobservable Description (RMB’000) technique(s) inputs (weighted average) inputs to fair value IP2 1,456,800 投資法租期收益率經計及可資比較物業的收益率及反租期收益率越高， Investment Term yield 映所擔保及將收取租期收入的確公允價值越低 approach 定性的調整，租期收益率為4.5%The higher the term yield, the 5.5%(5.1%)。 lower the fair value Term yield of 4.5% – 5.5%(5.1%), taking into account of yield generated from comparable properties and adjustment to reflect the certainty of term income secured and to be received. 復歸收益率經計及可資比較物業的年度單位市場復歸收益率越高， Reversionary yield 租金收入及單位市場價值，復歸收公允價值越低益率為5.5%-6.5%(6.3%)。 The higher the reversionary Reversionary yield of 5.5% – yield, the lower the fair 6.5%(6.3%), taking into account value annual unit market rental income and unit market value of the comparable properties. 各單位的市場單位每月人民幣30元╱平方米至每月人民市場單位租金越高，租金幣163元╱平方米。（每月人民幣57 公允價值越高 Market unit rent 元╱平方米） The higher the reversionary of individual unit RMB30 – RMB163 per square meter yield, the lower the fair per month (RMB57 per square value meter per month)

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新城發展控股有限公司 Future Land Development Holdings Limited F-75 二零一三年年報 2013 Annual Report

– F-206 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

於2013年 12月31日說明的公平值估值方法 Fair value at 31 December 2013 （人民幣千元） Valuation Description (RMB’000) technique(s)

不可觀察輸入值與公允價值的關係

不可觀察輸入值

不可觀察輸入值（加權平均數）的範圍

Relationship of unobservable inputs to fair value

Range of unobservable inputs (weighted average)

Unobservable inputs

復歸收益率越高，公允價值越低

經計及可資比較物業的年度單位市場租金收入及單位市場價值，復歸收益率為7%。

IP3 156,000 投資法，有至竣工的收益率估計成本 Reversionary yield Investment approach with estimated costs to complete

The higher the reversionary yield, the lower the fair value

Reversionary yield of 7%, taking into account annual unit market rental income and unit market value of the comparable properties.

各單位的市場單位每月人民幣33元╱平方米至每月人民復歸收益率越高，租金幣135元╱平方米。（每月人民幣45 公允價值越低 Market unit rent 元╱平方米） of individual unit RMB33 – RMB135 per square meter per month (RMB45 per square value meter per month)

The higher the market unit rent, the higher the fair value

估計建設成本越高，公允價值越低

人民幣548,288,000元 RMB548,288,000

至竣工的估計建設

成本

The higher the estimated construction costs, the lower the fair value

Estimated construction costs to completion

所需利潤率越高，公允價值越低

持有及發展物業至物業價值的20% 竣工所需的估計 20% of property value 利潤率

The higher the profit margin required, the lower the fair value

Estimated profit margin required to hold and develop property to completion

F-76 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-207 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

倘假設將產生的租金單價、收益率和建設成本較管理層的預測數據增加或減少10%，於2013年和2012年 12月31日之投資物業的賬面值將變動如下：

於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000	於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000
投資物業增加╱（減少） Investment properties increase/(decrease) －租金單價增加10% – 10 percent rental rate higher 292,594 －租金單價減少10% – 10 percent rental rate lower (294,723)	232,688 (225,982)
投資物業增加╱（減少） Investment properties increase/(decrease) －所用收益率增加10% – 10 percent yield rate used higher (253,566) －所用收益率減少10% – 10 percent yield rate used lower 283,968	(199,859) 233,448
投資物業增加╱（減少） Investment properties increase/(decrease) －將產生的建設成本增加10% – 10 percent construction costs to incur higher (49,258) －將產生的建設成本減少10% – 10 percent construction costs to incur lower 49,258	不適用N/A 不適用N/A

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F-77

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-208 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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8 投資物業（續）

8 INVESTMENT PROPERTIES (Cont’d)

		截至12月31日止年度	截至12月31日止年度
		Year ended 31	December
		2013年	2012年
		2013	2012
		人民幣千元	人民幣千元
		RMB’000	RMB’000
租金收入	Rental income	81,110	23,634

本集團於投資物業的權益按其賬面淨值分析如下：

The Group’s interests in investment properties at their net book values are analysed as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
在中國，	In the PRC, held on:
按原本40年租約持有（而於2013年	Leases with original term of 40 years
12月31日，餘下未到期年期為	(and remaining unexpired period of 33 years
33及36年）	and 36 years as at 31 December 2013)	3,302,800		3,101,400
按原本70年租約持有（而於2013年	Leases with original term of 70 years
12月31日，餘下未到期年期為	(and remaining unexpired period of 54 years
54年）	as at 31 December 2013)	4,200		4,200
		3,307,000		3,105,600

Investment properties with a total carrying amount of RMB3,236,563,000 as at 31 December 2013 (2012: RMB1,416,400,000) were pledged as collateral for the Group’s borrowings (Note 22).

於2013年12月31日，賬面總值約為人民幣 3,236,563,000元（2012年：人民幣1,416,400,000 元）的投資物業已抵押作本集團借款的抵押品（附註 22）。

F-78 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-209 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

9 無形資產	9	INTANGIBLE ASSETS	INTANGIBLE ASSETS
本集團		Group
		商標	電腦軟件	合計
			computer
		Trademarks	software	Total
		人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000
於2013年1月1日	At 1 January 2013
成本	Cost	800	11,895	12,695
累計攤銷	Accumulated amortisation	(747)	(4,681)	(5,428)
賬面淨值	Net book amount	53	7,214	7,267
截至2013年12月31日止年度	Year ended 31 December 2013
年初賬面淨值	Opening net book amount	53	7,214	7,267
添置	Additions	–	4,987	4,987
攤銷費用（附註28）	Amortisation charge (Note 28)	(53)	(2,365)	(2,418)
年末賬面淨值	Closing net book amount	–	9,836	9,836
於2013年12月31日	At 31 December 2013
成本	Cost	800	16,882	17,682
累計攤銷	Accumulated amortisation	(800)	(7,046)	(7,846)
賬面淨值	Net book amount	–	9,836	9,836
於2012年1月1日	At 1 January 2012
成本	Cost	800	8,438	9,238
累計折舊	Accumulated amortisation	(667)	(3,230)	(3,897)
賬面淨值	Net book amount	133	5,208	5,341
截至2012年12月31日止年度	Year ended 31 December 2012
年初賬面淨值	Opening net book amount	133	5,208	5,341
添置	Additions	–	3,457	3,457
攤銷費用（附註28）	Amortisation charge (Note 28)	(80)	(1,451)	(1,531)
年末賬面淨值	Closing net book amount	53	7,214	7,267
於2012年12月31日	At 31 December 2012
成本	Cost	800	11,895	12,695
累計攤銷	Accumulated amortisation	(747)	(4,681)	(5,428)
賬面淨值	Net book amount	53	7,214	7,267

截至2013年及2012年12月31日止年度，本集團無形資產的攤銷費用已悉數計入行政開支。

The Group’s amortisation charges of intangible assets have all been included in administrative expenses for the years ended 31 December 2013 and 2012.

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新城發展控股有限公司 Future Land Development Holdings Limited F-79 二零一三年年報 2013 Annual Report

– F-210 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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10 於聯營公司的投資－本集團

10 INVESTMENTS IN ASSOCIATES – GROUP

	10 於聯營公司的投資－	10 INVESTMEN GROUP 本集團	TS IN ASSOCIATES –
			截至12月31日止年度
			Year ended 31 December
			2013年 2012年
			2013 2012
			人民幣千元人民幣千元
			RMB’000 RMB’000
	期初結餘	Opening balance	229,890 235,000
	－於Shanghai Lan Tian Business	– Investment in Shanghai Lan Tian Business
	Development Property Co., Ltd.	Development Property Co., Ltd.
	（「Shanghai Lan Tian」）的投資(a)	(“Shanghai Lan Tian”) (a)	10,000 10,000
	－於上海萬之城房地產開發有限	– Investment in Shanghai Wan Zhi Cheng Real
	公司（「上海萬之城」）的投資(b)	Estate Development Co., Ltd.
		(“Shanghai Wan Zhi Cheng”) (b)	219,890 225,000
減少		Deductions
－於上海萬之城的投資(b)		– Investment in Shanghai Wan Zhi Cheng (b)	(175,000) –
應佔業績		Share of results
－上海萬之城(b)		– Shanghai Wan Zhi Cheng (b)	(11,422) (5,110)
	期末結餘	Ending balance	43,468 229,890
	－於Shanghai Lan Tian Business	– Investment in Shanghai Lan Tian Business
	Development Property Co., Ltd.	Development Property Co., Ltd. (a)
	的投資(a)		10,000 10,000
	－於上海萬之城房地產開發有限	– Investment in Shanghai Wan Zhi Cheng Real
	公司的投資(b)	Estate Development Co., Ltd. (b)	33,468 219,890

F-80 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-211 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

10 於聯營公司的投資－本集團（續）

10 INVESTMENTS IN ASSOCIATES – GROUP (Cont’d)

(a) Shanghai Lan Tian在2010年8月4日成立。本集團擁有該公司20%的股權。
(a) Shanghai Lan Tian was established on 4 August 2010. The Group owns 20% of equity interest in this company.

本集團應佔Shanghai Lan Tian的業績以及資產和負債總額列示如下：

The Group’s share of results and the aggregated assets and liabilities of Shanghai Lan Tian are as follows:

		所持權益百分				淨（虧損）╱
		比	總資產	總負債	總收入	利潤
		% interests	Total	Total	Total	Net (loss)/
		held	assets	liabilities	revenue	profit
			人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000
於及截至2013年12月31日	As at and for the year ended
止年度	31 December 2013	20%	10,053	–	–	(4)
於及截至2012年12月31日	As at and for the year ended
止年度	31 December 2012	20%	10,057	–	–	15

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新城發展控股有限公司 Future Land Development Holdings Limited F-81 二零一三年年報 2013 Annual Report

– F-212 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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10 於聯營公司的投資－本集團（續）

10 INVESTMENTS IN ASSOCIATES – GROUP (Cont’d)

(b) 上海萬之城在2011年3月29日成立。本集團擁有該公司50%的股權。於2013年，上海萬之城減資350,000,000元。相應地，本集團由該公司收回人民幣175,000,000元，並將其沖減於聯營企業的投資。
(b) Shanghai Wan Zhi Cheng was established on 29 March 2011. The Group owns 50% of equity interest in this company. In 2013, Shanghai Wan Zhi Cheng reduced its paid in capital by RMB350,000,000 and accordingly the Group received RMB175,000,000 from the company and recorded it as a reduction of investment in an associate.

本集團應佔上海萬之城的業績以及資產和負債總額列示如下：

The Group’s share of results and the aggregated assets and liabilities of Shanghai Wan Zhi Cheng are as follows:

		所持權益
		百分比	總資產	總負債	總收入	淨虧損
		% interests	Total	Total	Total	Net
		held	assets	liabilities	revenue	loss
			人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000
於及截至2013年12月31日	As at and for the year ended
止年度	31 December 2013	50%	869,630	836,162	458,157	11,422
於及截至2012年12月31日	As at and for the year ended
止年度	31 December 2012	50%	859,407	639,975	–	5,110

In the opinion of the directors, there is no associate, which is material to the Group.

董事認為，概無對本集團而言屬重大的聯營公司。

F-82 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-213 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

11 於合營企業的投資－本集團

11 INVESTMENTS IN A JOINT VENTURE – GROUP

截至2013年 12月31日止年度 Year ended 31 December 2013 人民幣千元 RMB’000 向合營企業注資及期末結餘 Capital injection to a joint venture and ending balance －投資於上海新城旭地房地產有限公司 – Investment in Shanghai Xincheng Xudi Real Estate （「上海旭地」）(a) Co., Ltd. (“Shanghai Xudi”) (a) 10,000

Note: There are no contingent liabilities relating to the Group’s interest in the joint venture.

附註：概無任何與本集團於合營企業權益有關的或然負債。 (a) 上海旭地在2013年10月11日成立。本集團擁有該公司50%權益。本集團應佔上海旭地的業績以及資產和負債總額列示如下：

(a) Shanghai Xudi was established on 11 October 2013. The Group owns 50% of equity interest in this company.

The Group’s share of results and the aggregated assets and liabilities of Shanghai Xudi are as follows:

		所持權益百分比總資產總負債總收入淨虧損 % interests held Total assets Total liabilities Total revenue Net loss 人民幣千元人民幣千元人民幣千元人民幣千元 RMB’000 RMB’000 RMB’000 RMB’000
於及截至2013年12月31日	As at and for the year ended
止年度	31 December 2013	50% 372,523 362,565 – 42

董事認為，上海旭地對本集團而言並非屬重大。

In the opinion of the directors, Shanghai Xudi is not material to the Group.

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新城發展控股有限公司 Future Land Development Holdings Limited F-83 二零一三年年報 2013 Annual Report

– F-214 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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12 可供出售金融資產

12 AVAILABLE-FOR-SALE FINANCIAL ASSETS

本集團

Group

		截至12月31日止年度	截至12月31日止年度	截至12月31日止年度
		Year ended 31	December
		2013年		2012年
		2013		2012
		人民幣千元		人民幣千元
		RMB’000		RMB’000
期初結餘	Opening balance	181,187		156,000 (a)
收購	Acquisitions	40,000 (c,d)		25,187 (b,c,d)
期末結餘	Ending balance	221,187		181,187

(a) On 2 September 2010, the Group acquired 1% equity interest in Bank of Suzhou at a consideration of RMB156,000,000. There is no significant change in fair value of the financial asset as at 31 December 2013 and 2012, respectively from the acquisition cost.
(a) 於2010年9月2日，本集團以代價人民幣 156,000,000元收購蘇州銀行1%的股權。此項金融資產分別於2013年及2012年12月31日的公允價值相對收購成本並無重大變動。
(b) On 10 April 2012, the Group acquired 6.19% equity interest in Shanghai Jingying Investment Management Limited Partnership at a consideration of RMB5,187,000. There is no significant change in fair value of the financial asset as at 31 December 2013 from the acquisition cost.
(b) 於2012年4月10日，本集團以代價人民幣 5,187,000元收購Shanghai Jingying Investment Management Limited Partnership 6.19%的股權。此項金融資產於2013年12月31日的公允價值相對收購成本並無重大變動。
(c) On 15 October 2012, the Group acquired 5.26% equity interest in Shanghai Wuling Investment Management Limited Partnership at a consideration of RMB50,000,000, with an amount of RMB20,000,000 and RMB15,000,000 already paid during the year ended 31 December 2013 and 2012 respectively. There is no significant change in fair value of the financial asset as at 31 December 2013 from the acquisition cost.
(c) 於2012年10月15日，本集團以代價人民幣 50,000,000元（人民幣20,000,000元及人民幣15,000,000元款項已分別於截至2013 年及2012年12月31日止年度內支付）收購 Shanghai Wuling Investment Management Limited Partnership 5.26%的股權。此項金融資產於2013年12月31日的公允價值相對收購成本並無重大變動。
(d) On 2 November 2012, the Group acquired 2.72% equity interest in Gefei Assets Management Limited Partnership at a consideration of RMB25,000,000, with an amount of RMB20,000,000 and RMB5,000,000 already paid during the year ended 31 December 2013 and 2012 respectively. There is no significant change in fair value of the financial asset as at 31 December 2013 from the acquisition cost.
(d) 於2012年11月2日，本集團以代價人民幣 25,000,000元（人民幣20,000,000元及人民幣5,000,000元款項已分別於截至2013年及 2012年12月31日止年度內支付）收購Gefei Assets Management Limited Partnership 2.72%的股權。此項金融資產於2013年12月 31日的公允價值相對收購成本並無重大變動。

F-84 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-215 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

13 土地使用權－本集團

13 LAND USE RIGHTS – GROUP

此餘額為一項待場地取得所需批准重新規劃作商業用途後將用於物業開發並銷售的土地使用權。於2013 年12月31日，賬面總值為人民幣367,248,000元的土地使用權已抵押作本集團借款的抵押品（附註22）。

The balance represents land use rights to be used for development of properties for sale in the future upon obtaining the necessary approval to re-zone the site for commercial use. As at 31 December 2013, land use rights with a total carrying amount of RMB367,248,000 were pledged as collateral for the Group’s borrowings (Note 22).

14 租賃土地預付款項－本集團

14 PREPAYMENTS FOR LEASEHOLD LAND – GROUP

本集團於截至2013年12月31日預付人民幣 3,285,498,000元用於購買租賃土地使用權（2012 年：人民幣4,313,847,000元）。

The Group made prepayments of RMB3,285,498,000 for the acquisition of leasehold land as at 31 December 2013 (2012: RMB4,313,847,000).

15 完工待售或在建銷售物業

15 PROPERTIES HELD OR UNDER DEVELOPMENT FOR SALE

本集團

Group

本集團 Group	本集團 Group
於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000
將予開發的租賃土地 Leasehold land to be developed 1,548,783 在建銷售物業 Properties under development for sale 19,493,659 完工待售物業 Properties held for sale 7,954,743	1,518,738 17,089,398 6,235,028
28,997,185 減：減值虧損撥備 Less: Provision for impairment loss (268,221)	24,843,164 (349,412)
28,728,964	24,493,752

The properties held or under development for sale are all located in the PRC.

完工待售或在建銷售物業均位於中國。

Borrowing costs capitalised in properties under development for sale and held for sale for the year ended 31 December 2013 were approximately RMB682,958,807 (2012: RMB776,028,000).

截至2013年12月31日止年度，於完工待售和在建銷售物業中資本化的借款成本約為人民幣682,958,807 元（2012年：人民幣776,028,000元）。

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新城發展控股有限公司 Future Land Development Holdings Limited F-85 二零一三年年報 2013 Annual Report

– F-216 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

15 完工待售或在建銷售物業（續）

15 PROPERTIES HELD OR UNDER DEVELOPMENT FOR SALE (Cont’d)

The capitalisation rate of borrowings was 7.37% for the year ended 31 December 2013 (2012: 9.71%).

截至2013年12月31日止年度，借款資本化率為 7.37%（2012年：9.71%）。

As at 31 December 2013 and 2012, the Group’s following leasehold land to be developed, properties under development for sale and properties held for sale were pledged as collateral for the Group’s borrowings (Note 22).

於2013年及2012年12月31日，本集團以下將予開發的租賃土地、在建銷售物業和完工待售物業已抵押作本集團借款的抵押品（附註22）。

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
已抵押的賬面值：	Carrying value pledged:
將予開發的租賃土地	Leasehold land to be developed	322,704		642,204
在建銷售物業	Properties under development for sale	8,628,317		7,234,330
完工待售物業	Properties held for sale	768,023		931,768

截至2013年12月31日止年度，確認為開支及計入銷售成本的完工待售物業成本為人民幣14,803,610,000元（2012年：人民幣 12,575,554,000元），連帶撥回的減值撥備人民幣 160,779,000元（2012年：撥回人民幣132,988,000 元）已貸記入銷售成本。

For the year ended 31 December 2013, the cost of properties held for sale recognised as expense and included in cost of sales amounted to RMB14,803,610,000 (2012: RMB12,575,554,000), accompanying by a reversal of provision for impairment of RMB160,779,000 (2012: reversal of RMB132,988,000) credited to cost of sales.

於2013年12月31日，總賬面值為人民幣6,600,726,000 元（2012年：人民幣6,205,262,000元）的在建銷售物業與不預期於一年內竣工的物業項目相關，儘管可能會預售若干此等物業。所有在建租賃土地不預期於一年內竣工。完工待售或在建銷售物業的其他結餘預計可於一年內變賣。

As at 31 December 2013, properties under development for sale with a total carrying amount of RMB6,600,726,000 (2012: RMB6,205,262,000) were related to property projects which were not scheduled to complete within one year although pre-sales of some of these properties may occur. All the leasehold land to be developed were not scheduled to complete within one year. The other balances in properties held or under development for sale were expected to be recovered within one year.

F-86 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-217 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

16 貿易和其他應收款項及預付款項 16 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS

本集團		Group
			於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
			人民幣千元	人民幣千元
			RMB’000		RMB’000
貿易應收款項	Trade receivables		2,250		3,265
應收票據	Notes receivable		4,400		300
貿易應收款項合計	Total trade receivables		6,650		3,565
減：應收款項減值撥備	Less: Provision for impairment of receivables		–		–
貿易應收款項－淨額	Trade receivables – net		6,650		3,565
預付營業稅和附加費(a)	Prepaid business tax and surcharges (a)		567,828		645,416
預付所得稅和土地增值稅(a)	Prepaid income tax and land appreciation tax (a)		382,333		377,514
應收關連方款項（附註39）	Receivable from a related party (Notes 39)		362,565		180,000
投標保證金(b)	Tender deposits (b)		276,420		196,190
預付建設成本	Prepayments for construction costs		157,406		89,491
信託融資安排的保證金(c)	Deposit for trust financing arrangement (c)		125,000		–
於住房公積金中心的按金(d)	Deposits with public housing fund	centres (d)	122,920		116,989
項目適時建設保證金(e)	Deposits for timely project construction (e)		101,125		–
物業維護保證金(f)	Deposits for property maintenance	(f)	73,538		–
與出售子公司有關的應收款項	Receivable in connection with the disposal
其他	of a subsidiary Others		35,156 100,428		– 57,101
減：其他應收款項的非即期	Less: Non-current portion of other		2,311,369		1,666,266
部份(c、f)	receivables (c, f)		(198,538)		–
即期部份	Current portion		2,112,831		1,666,266

貿易應收款項主要來自物業銷售和投資物業租賃。物業銷售的所得款項一般於簽訂有關買賣協議後三個月內收取，而物業租賃的租金一般預先收取。

Trade receivables are mainly arisen from sales of properties and leases of investment properties. Proceeds in respect of properties sold are normally received within three months after signing of related sales and purchase agreements, and rentals in respect of leased properties are generally received in advance.

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新城發展控股有限公司 Future Land Development Holdings Limited F-87 二零一三年年報 2013 Annual Report

– F-218 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

16 貿易和其他應收款項及預付款項（續）

(a) 營業稅、附加費和土地增值稅於本集團收到客戶預付款時預徵收，此等預付稅項於相關收入確認前列作預付款項。此外，在計算應課稅收入時，按本集團收到的預付款的5%至 15%計算的預計利潤需計入會計收入，據此預付的所得稅同樣列作預付款項。
(b) 此結餘為土地使用權競標的投標保證金，將於其後收回或轉撥至租賃土地預付款項。
(c) 本集團就其子公司能獲得循環信託融資向 Jiangsu International Trust Co., Ltd存入保證金人民幣125,000,000元。於2013年12月 31日，該等子公司已向Jiangsu International Trust Co., Ltd悉數償還全部信託融資，保證金將於2015年退回。
(d) 此結餘為向住房公積金中心支付的按金以擔保本集團若干購房者的住房公積金貸款。這些按金將於政府部門發出物業所有權證至這些購房者並向住房公積金中心提交時予以解除。
(e) 該項結餘為項目的適時建設保證金，將隨後於項目建設過程中收回，並預計在未來12個月內收回。
(f) 該項結餘為首次交付有關物業時支付的物業維護保證金，將於其後的十年內收回。

16 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

(a) B u s i n e s s t a x , s u rc h a r g e s a n d l a n d appreciation tax are provisionally levied when the Group receives advances from customers and the prepaid taxes are recorded as prepayments before the relevant revenue is recognised. In addition, a deemed profit at 5% to 15% of advances received by the Group is added to the accounting income when calculating taxable income and the prepaid income tax is similarly recorded as prepayments.
(b) This balance represents the tender deposits for bidding of land use rights, which will be subsequently received or transferred to prepayments for leasehold land.
(c) The Group deposited RMB125,000,000 in Jiangsu International Trust Co., Ltd. for revolving trust financing to its subsidiaries. As at 31 December 2013, the subsidiaries had repaid all the trust financing to Jiangsu International Trust Co., Ltd. and the deposit will be refunded in 2015.
(d) This balance represents the deposits paid to public housing fund centres to secure the housing fund loans taken by certain property purchasers of the Group. Such deposits will be released upon the issue of the properties’ ownership certificate by government authorities to these purchasers and submitted to the public housing fund centres.
(e) This balance represents the deposits for timely project construction, which will be subsequently received in the course of construction and are expected to be recovered in the next 12 months.
(f) This balance represents the deposits for property maintenance after first delivery of the relevant properties, which will be subsequently recovered in ten years thereafter.

F-88 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-219 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

16 貿易和其他應收款項及預付款項（續）

16 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

貿易應收款項於2013年及2012年12月31日的賬齡分析如下：

The aging analysis of trade receivables as at 31 December 2013 and 2012 are as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Less than 1 year	6,650		2,555
一至二年	Between 1 and 2 years	–		–
二至三年	Between 2 and 3 years	–		–
三年以上	Over 3 years	–		1,010
		6,650		3,565

於2013年和2012年12月31日承受的最大信貸風險是上述各類應收款項的賬面值。本集團並無持有任何抵押品。

The maximum exposure to credit risk at 31 December 2013 and 2012 is the carrying value of each class of receivables mentioned above. The Group does not hold any collateral security.

於2013年和2012年12月31日，貿易和其他應收款項的公允價值與其賬面值相若。

As at 31 December 2013 and 2012, the fair value of trade and other receivables approximate their carrying amounts.

於2013年和2012年12月31日，貿易和其他應收款項及預付款項的賬面值主要以人民幣計值。

As at 31 December 2013 and 2012, the carrying amounts of trade and other receivables and prepayments are primarily denominated in RMB.

本公司

company

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本公司	company
		於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
應收關連方款項（附註39）	Receivables from related parties (Notes 39)	3,832,174		717,847
其他應收賬款	Other receivables	2,294		570
		3,834,468		718,417

新城發展控股有限公司 Future Land Development Holdings Limited F-89 二零一三年年報 2013 Annual Report

– F-220 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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16 貿易和其他應收款項及預付款項（續）

16 TRADE AND OTHER RECEIVABLES AND PREPAYMENTS (Cont’d)

應收關連方款項和其他應收款項賬齡分析全部在1年內。

The aging of the receivables from related parties and other receivables are all within 1 year.

應收關連方款項和其他應收款項的公允價值與賬面值相若。

The fair value of the receivables from related parties and other receivables approximate their carrying amounts.

應收子公司款項為免息、無抵押及無特定還款期。本公司的意向為應收子公司的款項只會於子公司擁有現金盈餘時才會收回。

The amounts due from subsidiaries are interestfree, unsecured and have no specific repayment terms. The Company’s intention is that the amounts due from subsidiaries will only be recalled when the subsidiaries have surplus cash.

應收關連方款項和其他應收款項賬面值以下列貨幣計值：

The carrying amounts of the receivables from related parties and other receivables are denominated in the following currencies:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
人民幣	RMB	2,487,464		–
美元	USD	926,190		–
港元	HKD	420,814		718,417
		3,834,468		718,417

17 INVESTMENTS IN SUBSIDIARIES

17 於子公司的投資

company

本公司

(a) Investments in subsidiaries

(a) 於子公司的投資

(a) 於子公司的投資	*(a)* *Investme*	*nts in subsidiaries*	*nts in subsidiaries*	*nts in subsidiaries*
		於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元		人民幣千元
		RMB’000		RMB’000
未上市股權投資，按成本	Unlisted equity investments, at cost	450,012		424,271

F-90 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-221 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

17 於子公司的投資（續）

17 INVESTMENTS IN SUBSIDIARIES (Cont’d)

本公司間接持有的子公司江蘇新城地產股份有限公司為一家於上海證券交易所上市的B股公司。本集團持有的江蘇新城地產股份有限公司股數為937,728,000 股股份。該等股份為法人股，不能自由買賣。於 2013年12月31日，江蘇新城地產股份有限公司的自由流通股報價為每股0.607美元。

The Company’s indirectly held subsidiary, Jiangsu Future Land Co., Ltd. is a Shanghai Stock Exchange listed B share company. The number of shares of Jiangsu Future Land Co., Ltd. held by the Group is 937,728,000 shares. Such shares were legal person shares and cannot be freely traded. As at 31 December 2013, the quoted price of the freely tradeable shares of Jiangsu Future Land Co., Ltd. is USD0.607 per share.

本公司子公司於2013年及2012年12月31日的詳情載於合併財務報表附註41。於子公司的投資並無作出減值撥備。於子公司投資的增加來自授予本公司子公司僱員的首次公開發售前股份獎勵計劃（附註20）。

Particulars of the Company’s subsidiaries as at 31 December 2013 and 2012 are set out in Note 41 to the consolidated financial statements. No provision for impairment has been made against investments in subsidiaries. The increase in investments in subsidiaries pertains to the Pre-IPO share award scheme (Note 20) granted to the employees of the Company’s subsidiaries.

18 銀行和手頭現金

18 CASH AT BANK AND ON HAND

本集團

Group

本集團 Group	本集團 Group
於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000
銀行和手頭現金 Cash at bank and on hand 以人民幣計值 Denominated in RMB 7,898,005 以美元計值 Denominated in USD 308,965 以港元計值 Denominated in HKD 90,923	5,665,041 47 335,131
8,297,893	6,000,219

於2013年12月31日，本集團銀行存款的實際利率為 1.70%（2012年12月31日：0.91%）。

The effective interest rate on the Group’s bank deposits as at 31 December 2013 was 1.70% (31 December 2012: 0.91%).

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新城發展控股有限公司 Future Land Development Holdings Limited F-91 二零一三年年報 2013 Annual Report

– F-222 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

18 銀行和手頭現金（續）

18 CASH AT BANK AND ON HAND

(Cont’d)

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本集團的現金和現金等價物釐定如下：

Cash and cash equivalents of the Group were determined as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
銀行和手頭現金	Cash at bank and on hand	8,297,893		6,000,219
減：受限制現金	Less: Restricted cash	(886,180)	(1,148,089)
		7,411,713		4,852,130

本集團的受限制現金包括以下各項：

Restricted cash of the Group comprised of the following:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
作為項目建設簽發保函	Deposits for letters of guarantee issued for
的保證金	project construction	81,261		22,107
票據保證金	Margin deposits for notes issued	659,238		637,748
購房者按揭貸款保證金(a)	Deposits as security for property purchasers’
	mortgage loans (a)	71,907		42,645
作為借款抵押的存款（附註22）	Deposits pledged for borrowings (Note 22)	73,774		45,589
定期存款(b)	Time deposit (b)	–		400,000
		886,180		1,148,089

(a) 這些受限制銀行存款用於確保本集團若干購房者根據若干城市的地方法規能取得銀行貸款。這些存款將於物業所有權證由政府部門發出給這些購房者並向按揭銀行提交時予以解除。

(a) These bank deposits are restricted to secure the bank loans taken by certain property purchasers of the Group pursuant to the local regulations of certain cities. Such deposits will be released upon the issue of the properties’ ownership certificate by government authorities to these purchasers and submitted to the mortgage banks.

(b) 於2012年12月31日，這筆受限制定期存款用於申請銀行借貸，並已於2013年償還。

(b) The time deposit is restricted for application of bank borrowings as at 31 December 2012, which was repaid in 2013.

F-92 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-223 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

18 銀行和手頭現金（續） 18 CASH AT BANK AND ON HAND (Cont’d)

18 銀行和手頭現	金（續） 1	8 CASH AT BA (Cont’d)	NK AND ON	HAN	D
本公司		company
			於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
			人民幣千元	人民幣千元
			RMB’000		RMB’000
銀行和手頭現金	Cash at bank and on hand
以人民幣計值	Denominated in RMB		2,594		877,935
以美元計值	Denominated in USD		2,374		47
以港元計值	Denominated in HKD		2,529		17,325
			7,497		895,307

於2013年12月31日，本公司銀行存款的實際利率為 0.11%（2012年：0.22%）。

The effective interest rate on the Company’s bank deposits as at 31 December 2013 was 0.11% (2012: 0.22%).

19 股本本集團和本公司 (a) 法定股本

19 SHARE CAPITAL

Group and company

(a) Authorised shares

(a)	法定股本	*(a)*	*Authorised shares*
				法定股本數目
				Number of
				authorised
				shares
				港元股份
				HKD share
於2012年1月1日、於2012年		As at 1 January 2012, 31	December 2012 and
12月31日及2013年12月31日		31 December 2013		10,000,000,000
(b)	已發行股份	*(b)*	*Issued shares*

(b) Issued shares

==> picture [21 x 302] intentionally omitted <==

		已發行股份數目	普通股
		Number of	Ordinary
		issued shares	shares
		每股0.001港元	人民幣
		HKD0.001 each	RMB
2012年1月1日	As at 1 January 2012	4,250,000,000	3,466,077
發行普通股(i)	Issuance of ordinary shares (i)	1,418,000,000	1,150,992
於2012年12月31日及	As at 31 December 2012 and
於2013年12月31日	31 December 2013	5,668,000,000	4,617,069

新城發展控股有限公司 Future Land Development Holdings Limited F-93 二零一三年年報 2013 Annual Report

– F-224 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

19 股本（續）

(b) 已發行股份（續）

(i) 於2012年11月29日，本公司就上市按每股1.45港元發行1,418,000,000股每股0.001港元的港元普通股，並籌得總額約2,056,100,000港元（相等於人民幣1,668,936,000元）的款項。所得款項超過發行1,418,000,000股港元普通股面值共為人民幣1,150,992 元的金額為人民幣1,667,785,008 元，扣除發行新股直接相關的費用共人民幣65,165,000元後為人民幣 1,602,620,008元，此金額撥入股份溢價賬（附註21）。

20 以股份為基礎的支付

19 SHARE CAPITAL (Cont’d)

(b) Issued shares (Cont’d)

(i) On 29 November 2012, the Company issued 1,418,000,000 HKD ordinary shares of HKD0.001 each at HKD1.45 per share in connection with the Listing, and raised gross proceeds of approximately HKD2,056,100,000 (equivalent to RMB1,668,936,000). The excess of RMB1,667,785,008 over the par value of RMB1,150,992 for the 1,418,000,000 HKD ordinary shares issued, net of the relevant incremental costs of RMB65,165,000 directly contributable to the new shares issued, was credited to “share premium” with amount of RMB1,602,620,008 (Note 21).

20 SHARE-BASED PAYMENTS

F-94 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-225 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

20 以股份為基礎的支付（續）

於2012年6月30日，本公司修訂以股份支付的條件，延長本公司於2012年6月30日前於香港聯合交易所有限公司主板上市這項要求至2013年12月31日前。

截至2013年12月31日止年度，本集團就本公司授予現任僱員的股份確認人民幣25,741,000元（附註30）（2012年：人民幣36,697,000元）的費用。

下表披露於截至2013年12月31日止年度授予選定僱員的本公司股份變動及於2013年12月31日尚未行使的本公司股份：

20 SHARE-BASED PAYMENTS (Cont’d)

For the year ended 31 December 2013, the Group recognised an expense of RMB25,741,000 (Note 30) (2012: RMB36,697,000) in relation to the share award by the Company to the current employees.

The following table discloses the movement of the Company’s shares granted to the selected employees for the year ended 31 December 2013 and outstanding at 31 December 2013:

==> picture [21 x 302] intentionally omitted <==

		獎勵股份數目
		Number of
僱員	Employees	awarded shares
於2013年1月1日尚未行使	Outstanding as at 1 January 2013	181,050,000
年內歸屬	Vested during the year	(43,225,000)
年內未分配	Unallocated during the year	(9,250,000)
於2013年12月31日尚未行使	Outstanding as at 31 December 2013	128,575,000

新城發展控股有限公司 Future Land Development Holdings Limited F-95 二零一三年年報 2013 Annual Report

– F-226 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

21 本公司權益持有人應佔的其他儲備

21 OTHER RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY

本集團		Group
		股份溢價	其他儲備	保留盈利	合計
		Share	Other	Retained
		premium	reserves	earnings	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
				（附註(a)）
				(note (a))
於2013年1月1日的結餘	Balance at 1 January 2013	1,962,640	(177,501)	3,961,347	5,746,486
全面收益	comprehensive income
年度利潤	Profit for the year	–	–	981,262	981,262
其他全面收益	Other comprehensive income	–	–	–	–
年度全面收益總額	Total comprehensive
	income for the year	–	–	981,262	981,262
與擁有人進行的交易	Transactions with owners
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee services	–	25,741	–	25,741
股息（附註33）	Dividends (Note 33)	(283,400)	–	–	(283,400)
擁有人出資及分派總額	Total contributions by and
	distributions to owners	(283,400)	25,741	–	(257,659)
向非控股股東	Gain from acquisition of additional
收購子公司額外權益所得的收益（附註40）	interest in a subsidiary from non-controlling interests (Note 40)	–	246,942	–	246,942
直接於權益確認與擁有人	Total transactions with owners,
的交易總額	recognized directly in equity	(283,400)	272,683	–	(10,717)
於2013年12月31日的結餘	Balance at 31 December 2013	1,679,240	95,182	4,942,609	6,717,031
代表：	Representing:
建議末期股息（附註(b)）	Proposed final dividend (Note (b))	283,400			283,400
其他	Others	1,395,840			6,433,631
		1,679,240			6,717,031
於2012年1月1日的結餘	Balance at 1 January 2012	360,020	(214,198)	3,030,528	3,176,350
全面收益	comprehensive income
年度利潤	Profit for the year	–	–	930,819	930,819
其他全面收益	Other comprehensive income	–	–	–	–
年度全面收益總額	Total comprehensive income
	for the year	–	–	930,819	930,819
與擁有人進行的交易	Transactions with owners
發行普通股（附註19）	Issuance of ordinary shares (Note 19)	1,602,620	–	–	1,602,620
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee services	–	36,697	–	36,697
擁有人出資及分派總額	Total contributions by and
	distributions to owners	1,602,620	36,697	–	1,639,317
於2012年12月31日的結餘	Balance at 31 December 2012	1,962,640	(177,501)	3,961,347	5,746,486

F-96 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-227 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

21 本公司權益持有人應佔的其他儲備（續） 21 OTHER RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY (Cont’d)

本公司		company
		股份溢價	其他儲備	累計虧損	合計
		Share	Other	Accumulated
		premium	reserves	losses	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
				（附註(a)）
				(note (a))
於2013年1月1日的結餘	Balance at 1 January 2013	1,962,640	64,222	(7,273)	2,019,589
全面虧損	comprehensive loss
年度虧損	Loss for the year	–	–	(225,822)	(225,822)
其他全面虧損	Other comprehensive loss	–	–	–	–
年度全面虧損總額	Total comprehensive loss for the year	–	–	(225,822)	(225,822)
與擁有人進行的交易	Transactions with owners
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee services	–	25,741	–	25,741
股息（附註33）	Dividends (Note 33)	(283,400)	–	–	(283,400)
擁有人出資及分派總額	Total contributions by and
	distributions to owners	(283,400)	25,741	–	(257,659)
於2013年12月31日的結餘	Balance at 31 December 2013	1,679,240	89,963	(233,095)	1,536,108
代表：	Representing:
建議末期股息（附註(b)）	Proposed final dividend (note (b))	283,400			283,400
其他	Others	1,395,840			1,252,708
		1,679,240			1,536,108
於2012年1月1日的結餘	Balance at 1 January 2012	360,020	27,525	(3,215)	384,330
全面虧損	comprehensive loss
年度虧損	Loss for the year	–	–	(4,058)	(4,058)
其他全面虧損	Other comprehensive loss	–	–	–	–
年度全面虧損總額	Total comprehensive loss for the year	–	–	(4,058)	(4,058)
與擁有人進行的交易	Transactions with owners
發行普通股（附註19）	Issuance of ordinary shares (Note 19)	1,602,620	–	–	1,602,620
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
（附註20）	(Note 20)
－現任僱員服務價值	– value of current employee services	–	36,697	–	36,697
擁有人出資及分派總額	Total contributions by and
	distributions to owners	1,602,620	36,697	–	1,639,317
於2012年12月31日的結餘	Balance at 31 December 2012	1,962,640	64,222	(7,273)	2,019,589
代表：	Representing:
建議末期股息（附註(b)）	Proposed final dividend (note (b))	283,400			283,400
其他	Others	1,679,240			1,736,189
		1,962,640			2,019,589

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-97 二零一三年年報 2013 Annual Report

– F-228 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

21 本公司權益持有人應佔的其他儲備（續）

(a) 根據中國公司法與本公司中國子公司的組織章程細則，這些子公司每年須將其法定利潤（經抵銷任何過往年度虧損後）的10%撥入法定盈餘公積金（「公積金」）賬戶。當公積金結餘達到這些子公司註冊資本╱股本的50% 後，則可選擇是否進一步轉撥公積金。公積金可用於抵銷過往年度虧損或增加繳足資本。然而，在作該等用途後，有關公積金須不少於註冊資本╱股本的25%。

除清盤外，公積金不可用作分派現金股息，並受到若干相關中國法規所限制。

於2013年12月31日，這些子公司的歸屬於本公司擁有人的公積金總額達人民幣1,113,262,000元（2012年：人民幣 921,259,000元）。這些金額計入本集團的保留盈利。

(b) 根據開曼群島公司法（2003年修訂版）第34 條及本公司的組織章程細則，如本公司具備償還能力且本公司組織章程細則有所規定，則可以本公司的股份溢價向股東作出分派。有關建議末期股息的詳情載列於附註33。

21 OTHER RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY (Cont’d)

(a) In accordance with the Company Law of the PRC and the articles of association of the PRC subsidiaries, these subsidiaries registered in the PRC shall appropriate 10% of its annual statutory profit (after offsetting any prior years’ losses) to the statutory surplus reserve (“SSR”) account. When the balance of SSR reaches 50% of the registered capital/share capital of these subsidiaries, any further appropriation is optional. The SSR can be utilised to offset prior years’ losses or to increase paid-in capital. However, SSR shall be maintained at a minimum of 25% of registered capital/ share capital after such utilisation.

The SSR are non-distributable for cash dividends except in the event of liquidation and are subject to certain restrictions set out in the relevant PRC regulations.

As at 31 December 2013, total SSR of these subsidiaries attributable to owners of the Company amounted to RMB1,113,262,000 (2012: RMB921,259,000). These amounts were included in retained earnings of the Group.

(b) Pursuant to Section 34 of the Cayman Companies Law (2003 Revision) and the Articles of Association of the Company, share premium of the Company is available for distribution to shareholders subject to a solvency test on the Company and the provision of the Articles of Association of the Company. Details of the proposed final dividend are set out in Note 33.

F-98 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-229 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

22 借款 22 BORROWINGS

22 借款 22 BORROWINGS
本集團 Group 於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000 非即期、有抵押及向以下機構借入： Non-current, secured and borrowed from: －銀行(a) – Banks (a) 10,179,459 6,242,070 信託融資安排－傳統貸款(b) Trust financing arrangements – conventional loans (b) – 1,875,460 －2018年1月到期的優先票據（「2018年票據」）(c (i)） – Senior notes due January 2018 (“2018 Notes”) (c (i)) 1,189,147 – －2016年4月到期的優先票據（「2016年票據」）(c (ii)） – Senior notes due April 2016 (“2016 Notes”) (c (ii)) 1,477,928 – 非即期、無抵押及向一家銀行借入： Non-current, unsecured and borrowed from a bank 400,000 –	本公司 company 於12月31日 As at 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000
	– – – – 1,189,147 – 1,477,928 – – –
13,246,534 8,117,530 減：長期借款的即期部份 Less: Current portion of long-term borrowings (1,531,459) (3,607,860)	2,667,075 – – –
11,715,075 4,509,670	2,667,075 –
即期、有抵押及向以下機構借入： Current, secured and borrowed from: －銀行(a) – Banks (a) 643,042 1,210,716 信託融資安排－傳統貸款(b) Trust financing arrangements – conventional loans (b) – 311,860 長期借款的即期部份 Current portion of long-term borrowings 1,531,459 3,607,860	– – – – – –
2,174,501 5,130,436	– –

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-99 二零一三年年報 2013 Annual Report

– F-230 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

22 借款（續）

(a) 本集團的該等銀行借款由將予開發的租賃土地、在建物業、完工待售物業（附註15）、投資物業（附註8）、土地使用權（附註13）、物業、廠房和設備（附註7）、子公司股份（附註41）和銀行存款（附註18）抵押或由本公司的子公司相互擔保。
(b) 該等借款主要與信託公司以信託融資安排形式訂立。傳統貸款信託融資安排是本集團與信託公司訂立的貸款協議。信託融資安排項下的借款由若干完工待售或在建銷售物業（附註15）和本集團子公司的股份（附註41）抵押。

22 BORROWINGS (Cont’d)

(a) These bank borrowings of the Group are secured by leasehold land to be developed, properties under development, properties held for sale (Note 15), investment properties (Note 8), land use rights (Note 13), property, plant and equipment (Note 7), shares of subsidiaries (Note 41) and bank deposits (Note 18) of the Group or guaranteed by subsidiaries of the Company for each other.
(b) These borrowings are mainly in the form of trust financing arrangements with trust financing companies. The conventional loan trust financing arrangements are loan agreements entered into by the Group and trust financing companies. The borrowings under trust financing arrangements are secured by certain properties held or under development for sale (Note 15) and shares of subsidiaries of the Group (Note 41).

F-100 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-231 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

22 借款（續）

(c) 優先票據
(i) 2018年票據

於2013年1月，本公司發行本金額為2 億美元的五年期優先票據（「2018年票據」），該等票據於新加坡證券交易所上市。2018年票據以美元計值，按固定年利率10.25%計息，自2013年7月 31日開始於每個年度的1月31日及7月 31日或與之最接近的營業日每半年過後支付。

根據2018年票據的條款，票據可在以下情況下贖回：

若下文所載任何年份的1月31 日起12個月期間已贖回票據，則本公司可於2016年1月31日或之後任何時間及不時贖回全部或部份2018年票據，贖回價格等於下文所載本金的百分比加應計和未付利息（如有），直至（不包括）贖回日期：

22 BORROWINGS (Cont’d)

(c) Senior notes
(i) 2018 Notes

In January 2013, the Company issued five-year senior notes with principal amount of USD200,000,000 (“2018 Notes”), which were listed on the Singapore Exchange Securities Trading Limited. The 2018 Notes are denominated in USD, and bear fixed interest rate at 10.25% per annum, payable semi-annually in arrears on or on the business day nearest to 31 January and 31 July of each year, beginning 31 July 2013.

According to the terms of 2018 Notes, the Notes may be redeemed in the following circumstances:

At any time and from time to time on or after 31 January 2016, the Company may redeem the 2018 Notes, in whole or in part, at a redemption price equal to the percentage of principal amount set forth below, plus accrued and unpaid interest, if any, to (but excluding) the redemption date, if redeemed during the 12-month period commencing on 31 January of any year set forth below:

==> picture [21 x 302] intentionally omitted <==

		贖回價格
年份	Year	Redemption Price
自2016年1月31日至2017年1月30日	31 January 2016 to 30 January 2017	105.1250%
2017年1月31日及之後	31 January 2017 and thereafter	102.5625%

新城發展控股有限公司 Future Land Development Holdings Limited F-101 二零一三年年報 2013 Annual Report

– F-232 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

22 借款（續）

(c) 優先票據（續）
(i) 2018年票據（續）
- 本公司可於2016年1月31日之前任何時間酌情贖回全部但非部份票據，贖回價格等於2018 年票據本金的100%加適當溢價及應計和未付利息（如有），直至（不包括）贖回日期。
- 本公司可於2016年1月31日之前任何時間及不時，在若干條件的規限下以若干類股本銷售所得款項贖回最高達票據本金總額的35%，贖回價格為票據本金的110.25%加應計和未付利息（如有），直至（不包括）贖回日期；惟倘票據於原發行日期至少本金總額的65%於此贖回後仍未償還及此贖回於相關股本發售結束後60天內進行。

22 BORROWINGS (Cont’d)

(c) Senior notes (Cont’d)
(i) 2018 Notes (Cont’d)
- At any time prior to 31 January 2016, the Company may at its option redeem the Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of the 2018 Notes plus the applicable premium as of, and accrued and unpaid interest, if any, to (but not including) the redemption date.
- At any time and from time to time prior to 31 January 2016, the Company may redeem up to 35% of the aggregate principal amount of the Notes with proceeds from sales of certain kinds of its capital stock, subject to certain conditions, at a redemption price of 110.25% of the principal amount of the Notes, plus accrued and unpaid interest, if any, to (but not including) the redemption date; provided that at least 65% of the aggregate principal amount of the Notes issued on the original issue date remains outstanding after each such redemption and any such redemption takes place within 60 days after the closing of the related equity offering.

F-102 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-233 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

22 借款（續）

(c) 優先票據（續）
(ii) 2016年票據

2013年4月，本公司發行本金額為人民幣1,500,000,000元的三年期優先票據（「2016年票據」），該等票據於新加坡證券交易所上市。2016年票據以人民幣計值，按固定年利率9.75%計息，自2013年10月23日開始於每個年度的4月23日及10月23日或與之最接近的營業日每半年過後支付。

根據2016年票據的條款，本公司可酌情贖回全部但非部份2016年票據，贖回價格等於票據本金的100%加適當溢價及應計和未付利息（如有），直至（不包括）贖回日期。

提早贖回權被視為嵌入式衍生工具而與主合約並無密切關連。董事會認為，本公司現時無計劃提早贖回及上述提早贖回權之公允價值於初步確認時及於2013 年12月31日並不重大。

上述優先票據為一般責任，由若干非根據中國法律註冊成立的子公司擔保（「子公司擔保人」），及由若干原子公司擔保人的股份作抵押。

22 BORROWINGS (Cont’d)

(c) Senior notes (Cont’d)
(ii) 2016 Notes

In April 2013, the Company issued three-year senior notes with principal amount of RMB1,500,000,000 (“2016 Notes”), which were listed on the Singapore Exchange Securities Trading Limited. The 2016 Notes are denominated in RMB, and bear fixed interest rate at 9.75% per annum, payable semi-annually in arrears on or on the business day nearest to 23 April and 23 October of each year, beginning 23 October 2013.

According to the terms of 2016 Notes, the Company may at its option redeem the 2016 Notes, in whole but not in part, at a redemption price equal to 100% of the principal amount of the Notes plus the applicable premium as of, and accrued and unpaid interest, if any, to (but not including) the redemption date.

The early redemption options are regarded as embedded derivatives not closely related to the host contract. The board of directors is of the view that the Company has no plan of any early redemption and the fair values of the above early redemption options were insignificant on initial recognition and as at 31 December 2013.

The above senior notes are general obligations guaranteed by certain subsidiaries other than those established under the law of the PRC (“Subsidiary Guarantors”), and secured by a pledge on the shares of certain initial Subsidiary Guarantors.

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新城發展控股有限公司 Future Land Development Holdings Limited F-103 二零一三年年報 2013 Annual Report

– F-234 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

22 借款（續）

22 BORROWINGS (Cont’d)

The maturity of non-current borrowings as at 31 December 2013 and 2012 are as follows:

於2013年及2012年12月31日，非流動借款的到期情況列示如下：

		本集團	本集團	本公司	本公司
		Group		company
		於12月31日		於12月31日
		As at 31	December	As at 31	December
		2013年	2012年	2013年	2012年
		2013	2012	2013	2012
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000
一至兩年	Between 1 and 2 years	4,043,500	2,700,670	–	–
二至五年	Between 2 and 5 years	6,931,575	1,359,000	2,667,075	-
超過五年	Over 5 years	740,000	450,000	–	–
		11,715,075	4,509,670	2,667,075	–

於2013年和2012年12月31日，加權平均實際利率列示如下：

The weighted average effective interest rates as at 31 December 2013 and 2012 were as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
銀行借款	Bank borrowings	6.85%		6.76%
信託融資安排	Trust financing arrangements	不適用 N/A		13.50%
優先票據	Senior notes	10.72%	不適用N/A

The carrying amounts and fair value of the noncurrent borrowings are as follows:

非流動借款的賬面值及公允價值如下：

				本集團	本集團			本公司	本公司
				Group				company
			賬面值		公允價值		賬面值		公允價值
			carrying amount		Fair value		carrying amount		Fair value
			2013	2012	2013	2012	2013	2012	2013		2012
			人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
銀行借款	Bank	borrowings	9,048,000	4,509,670	9,048,000	4,509,670	–	–	–		–
2018年票據	2018	Notes	1,189,147	–	1,225,075	–	1,189,147	–	1,225,075		–
2016年票據	2016	Notes	1,477,928	–	1,503,135	–	1,477,928	–	1,503,135		–
			11,715,075	4,509,670	11,776,210	4,509,670	2,667,075	–	2,728,210		–

F-104 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-235 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

22 借款（續）

22 BORROWINGS (Cont’d)

2018年票據及2016年票據的公允價值乃按活躍市場報價計算，處於公允價值分層的第一層。

The fair value for 2018 Notes and 2016 Notes are based on quoted prices in active markets and are within Level 1 of the fair value hierarchy.

銀行借款的公允價值與其賬面值相若。公允價值以現金流量利用合適利率折現計算，處於公允價值分層的第二層。

The fair value for bank borrowings equals their carrying amount. The fair value is based on cash flows discounted using appropriate rates and are within Level 2 of the fair value hierarchy.

本集團借款的利率變動風險及合同重新定價日或到期日（以較早者為準）如下：

The exposure of the Group’s borrowings to interest rate changes and the contractual repricing dates or maturity whichever is the earlier date is as follows:

Group		六個月	六至
本集團		或以內	十二個月	一至五年	超過五年	合計
		6 months	6-12		Over
		or less	months	1-5 years	5 years	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
計入非流動負債的借款：	Borrowings included in non-current liabilities:
於2013年12月31日	As at 31 December 2013	2,400,000	4,010,000	4,915,075	390,000	11,715,075
於2012年12月31日	As at 31 December 2012	1,785,600	1,209,370	1,514,700	–	4,509,670
計入流動負債的借款：	Borrowings included in current liabilities:
於2013年12月31日	As at 31 December 2013	1,841,501	333,000	–	–	2,174,501
於2012年12月31日	As at 31 December 2012	5,040,436	90,000	–	–	5,130,436
company		六個月	六至
本公司		或以內	十二個月	一至五年	超過五年	合計
		6 months	6-12		Over
		or less	months	1-5 years	5 years	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
計入非流動負債的借款：	Borrowings included in non-current liabilities:
於2013年12月31日	As at 31 December 2013	–	–	2,667,075	–	2,667,075
於2012年12月31日	As at 31 December 2012	–	–	–	–	–
計入流動負債的借款：	Borrowings included in current liabilities:
於2013年12月31日	As at 31 December 2013	–	–	–	–	–
於2012年12月31日	As at 31 December 2012	–	–	–	–	–

T h e a g g r e g a t e p r i n c i p a l a m o u n t e d t o RMB5,117,617,000 are at fixed interest rates.

按固定息率計息的本金總額為人民幣5,117,617,000 元。

==> picture [21 x 302] intentionally omitted <==

F-105

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-236 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

22 借款（續）

22 BORROWINGS (Cont’d)

本集團借款的賬面值以下列貸幣計值：

The carrying values of the Group’s borrowings are denominated in the following currencies:

		本集團	本集團	本公司	本公司
		Group		company
		於12月31日		於12月31日
		As at 31	December	As at 31	December
		2013年	2012年 2013年		2012年
		2013	2012 2013		2012
		人民幣千元	人民幣千元人民幣千元		人民幣千元
		RMB’000	RMB’000 RMB’000		RMB’000
人民幣	RMB	12,634,887		– 1,477,928	–
美元	USD	1,254,689		– 1,189,147	–
		13,889,576		– 2,667,075	–

23 預售物業預收款項－本集團

23 ADVANCES FROM PRE-SALE OF PROPERTIES – GROUP

本集團在物業竣工及可供交付前開始銷售物業並向客戶收取款項。這些向客戶收取的款項在相關銷售確認前列作預售物業預收款項。

24 貿易和其他應付款項 24 TRADE AND OTHER PAYABLES

本集團

Group

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
貿易應付款項	Trade payables	8,276,829		8,223,769
應付票據	Notes payable	659,238		637,748
應還一間子公司	Advance from a non-controlling shareholder
非控股股東的暫借款(a)	of a subsidiary (a)	555,580		–
營業稅和其他應付稅項	Business and other taxes payable	233,539		208,460
代收保養及裝修費	Maintenance & decoration fees collected on behalf	152,591		122,198
應計工資	Accrued payroll	127,136		71,912
應付利息	Interest payable	118,392		125,396
代收契稅	Deed tax collected on behalf	105,364		127,673
應付關連方款項（附註39）	Payables to related parties (Note 39)	50,000		–
應還臨時借用資金(b)	Temporary funding payables (b)	18,000		18,000
其他	Others	71,807		61,873
		10,368,476		9,597,029

F-106 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-237 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 截至2013年12月31日止年度 For the year ended 31 December 2013

24 貿易和其他應付款項（續）

24 TRADE AND OTHER PAYABLES (Cont’d) Group (cont’d)

本集團（續）

(a) 該暫借款不計息、無抵押且無固定歸還條款。但該暫借款享有優先返還權，優先於該子公司其他股東，包括本集團提供的暫借款及該子公司的其他融資債務（銀行借款除外）獲得償付。
(a) The advance is non-interest bearing, unsecured and has no fixed repayment terms. However the advance has repayment priority over any advances from other shareholders of the subsidiary, including those from the Group, and other borrowings (except for bank borrowings) to the subsidiary.
(b) 應還臨時借用資金均為應付非關聯方款項，不計息且無抵押。
(b) Temporary funding payables are payables to non-related parties which are non-interest bearing and unsecured.

貿易應付款項及應付票據於2013年及2012年12月31 日的賬齡分析如下：

The aging analysis of trade payables and notes payable as at 31 December 2013 and 2012 are as follows:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Less than 1 year	8,673,152		8,694,356
一至二年	Between 1 and 2 years	178,168		120,120
二至三年	Between 2 and 3 years	56,826		27,644
三年以上	Over 3 years	27,921		19,397
		8,936,067		8,861,517

於2013年和2012年12月31日，貿易和其他應付款項的公允價值與其賬面值相若。

As 31 December 2013 and 2012, the fair value of trade and other payables approximate their carrying amounts.

於2013年和2012年12月31日，貿易和其他應付款項的賬面值主要以人民幣計值。

As at 31 December 2013 and 2012, the carrying amounts of trade and other payables are primarily denominated in RMB.

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新城發展控股有限公司 Future Land Development Holdings Limited F-107 二零一三年年報 2013 Annual Report

– F-238 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

24 貿易和其他應付款項（續） 24 TRADE AND OTHER PAYABLES (Cont’d)

==> picture [21 x 302] intentionally omitted <==

本公司

company

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
應付利息	Interest payable	79,297		–
應付專業費用	Professional fees payable	4,880		13,789
		84,177		13,789

The aging analysis of trade and other payables as at 31 December 2013 and 2012 are all less than 1 year.

於2013年和2012年12月31日，貿易和其他應付款項賬齡分析全部少於1年。

As 31 December 2013 and 2012, the fair value of trade and other payables approximate their carrying amounts.

於2013年和2012年12月31日，貿易和其他應付款項的公允價值與其賬面值相若。

As at 31 December 2013 and 2012, the carrying amounts of trade and other payables are denominated in the following currencies:

於2013年和2012年12月31日，貿易和其他應付款項的賬面值以下列貨幣計值：

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
美元	USD	52,078		–
人民幣	RMB	27,219		–
港元	HKD	4,880		13,789
		84,177		13,789

F-108 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-239 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

25 遞延所得稅 25 DEFERRED INCOME TAx

本集團

Group

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
將可動用的遞延稅項資產	Deferred tax assets to be recovered
－十二個月內	– within 12 months	45,059		19,234
－十二個月後	– after 12 months	454,679		341,959
		499,738		361,193
將予結清的遞延稅項負債	Deferred tax liabilities to be settled
－十二個月內	– within 12 months	(35,810)		(22,120)
－十二個月後	– after 12 months	(397,112)		(380,752)
		(432,922)		(402,872)
遞延稅項資產╱（負債）淨額	Deferred tax assets/(liabilities), net	66,816		(41,679)

遞延所得稅賬目的變動列示如下：

The gross movement on the deferred income tax account is as follows:

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
年初	At beginning of year	(41,679) 19,403
貸記╱（支銷）合併利潤表	Credited/(charged) to the consolidated
（附註31）	statement of income (Note 31)	108,495 (61,082)
年末	At end of year	66,816 (41,679)

於2013年12月31日，人民幣82,242,000元的遞延所得稅資產和遞延所得稅負債已相互抵銷（2012年：人民幣47,423,000元）。

As at 31 December 2013, deferred income tax assets and deferred income tax liabilities amounted to RMB82,242,000 were offset (2012: RMB47,423,000).

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新城發展控股有限公司 Future Land Development Holdings Limited F-109 二零一三年年報 2013 Annual Report

– F-240 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

25 遞延所得稅（續）

25 DEFERRED INCOME TAx (Cont’d)

於截至2013年及2012年12月31日止年度，遞延所得稅資產和負債的原額變動（未經考慮抵銷同一稅務司法權區內的結餘）列示如下：

The gross movement in deferred income tax assets and liabilities for the years ended 31 December 2013 and 2012, without taking into consideration the offsetting of balances within the same tax jurisdiction, are as follows:

遞延所得稅資產

Deferred income tax assets

			完工待售			對銷
		稅務虧損	物業撥備	應計費用	土地增值稅	公司間交易	合計
			Provisions for		Land	Elimination of
			properties		appreciation	inter-company
		Tax losses	held for sale	Accruals	tax	transactions	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
於2013年1月1日	At 1 January 2013	167,802	87,353	4,590	147,946	925	408,616
貸記╱（支銷）	Credited/(charged) to the consolidated
合併利潤表	statement of income	108,622	(20,298)	6,146	79,306	(412)	173,364
於2013年12月31日	At 31 December 2013	276,424	67,055	10,736	227,252	513	581,980
於2012年1月1日	At 1 January 2012	150,744	120,600	14,450	98,384	1,692	385,870
貸記╱（支銷）合併利潤表	Credited/(charged) to the consolidated
	statement of income	17,058	(33,247)	(9,860)	49,562	(767)	22,746
於2012年12月31日	At 31 December 2012	167,802	87,353	4,590	147,946	925	408,616

The Group did not recognise deferred income t a x a s s e t s o f R M B 1 0 1 , 4 2 2 , 0 0 0 ( 2 0 1 2 : RMB100,852,000) in respect of tax losses amounting to RMB405,687,000 as at 31 December 2013 (2012: RMB403,407,000). All these tax losses will expire within five years.

本集團並未就於2013年12月31日金額為人民幣 405,687,000元（2012年：人民幣403,407,000 元）的稅務虧損確認相應的遞延所得稅資產人民幣 101,422,000元（2012年：人民幣100,852,000元）。所有這些稅務虧損將於五年內到期。

F-110 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-241 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

25 遞延所得稅（續） 25 DEFERRED INCOME TAx (Cont’d)

遞延所得稅負債

Deferred income tax liabilities

		投資物業
		公允價值		對銷公司	車庫成本	中國子公司	投資
		收益	收購子公司	間交易	分攤差異	的未分配利潤	物業折舊	合計
		Fair value
		gains on		Elimination of	carpark cost	Undistributed	Depreciation
		investment	Acquisition of	inter-company	allocation	profits of PRc	of investment
		properties	subsidiaries	transactions	differences	subsidiaries	properties	Total
		人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
		RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
						（附註(a)）
						(note (a))
於2013年1月1日	At 1 January 2013	282,993	3,120	6,363	145,182	12,637	–	450,295
支銷╱（貸記）合併利潤表	Charged/(credited) to the
	consolidated statement
	of income	9,460	(74)	1,993	22,420	11,771	19,299	64,869
於2013年12月31日	At 31 December 2013	292,453	3,046	8,356	167,602	24,408	19,299	515,164
於2012年1月1日	At 1 January 2012	275,221	6,432	7,465	77,349	–	–	366,467
支銷╱（貸記）合併利潤表	Charged/(credited) to the
	consolidated statement
	of income	7,772	(3,312)	(1,102)	67,833	12,637	–	83,828
於2012年12月31日	At 31 December 2012	282,993	3,120	6,363	145,182	12,637	–	450,295

(a) 於2013年12月31日，本集團已就中國境外投資者應佔若干中國子公司部份未匯出可供分配利潤在匯出時應支付的預扣稅確認遞延所得稅負債人民幣24,408,000元（2012年：人民幣12,637,000元）。

(a) As at 31 December 2013, deferred income tax liabilities of RMB24,408,000 (2012: 12,637,000) have been recognised for the withholding tax that would be payable upon remittance, in respect of a portion of the unremitted distributable profits of certain PRC subsidiaries attributable to the investors outside PRC.

於2013年12月31日，本集團未就中國境外投資者應佔若干中國子公司為數人民幣3,118,926,000元（2012年：人民幣 2,470,027,000元）的未匯出可分派利潤在匯出時應支付的預扣稅確認相關的遞延所得稅負債人民幣155,946,000元（2012年：人民幣 123,501,000元），這乃由於該等利潤擬作為再投資。

As at 31 December 2013, deferred income tax liabilities of RMB155,946,000 (2012: RMB123,501,000) have not been recognised for the withholding tax that would be payable upon remittance, in respect of the unremitted distributable p ro f i t s o f c e r t a i n P R C s u b s i d i a r i e s attributable to the investors outside PRC amounting to RMB3,118,926,000 (2012: RMB2,470,027,000) as such profits are intended to be reinvested.

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新城發展控股有限公司 Future Land Development Holdings Limited F-111 二零一三年年報 2013 Annual Report

– F-242 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

26 收入

26 REVENUE

截至2013年及2012年12月31日止年度，本集團的營業額包括以下各項收入：

Turnover of the Group consists of the following revenues for the years ended 31 December 2013 and 2012:

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
銷售物業收入	Revenue from sales of properties	20,421,811 17,341,932
物業管理收入	Revenue from property management	182,501 121,469
租金收入	Rental income	102,356 35,620
其他	Others	64,587 18,245
		20,771,255 17,517,266

F-112 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-243 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

27 其他收入╱其他開支╱其他收益－淨 27 OTHER INCOME/OTHER ExPENSES/ 額 OTHER GAINS – NET

27 其他收入╱其他開額	支╱其他收益－淨 27 OTHER INC OTHER GAI	OME/OTHER ExPENS NS – NET	ES/
		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013	2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
其他收入	Other income
政府補貼	Government grants	63,694	4,433
可供出售金融資產股息收入(c)	Dividend income on available-for-sale financial assets (c)	6,605	5,042
政府徵用土地獲得之補償(a)	Compensation for land requisition
	by the government (a)	81,375	–
		151,674	9,475
其他開支	Other expenses
捐贈	Donations	(4,152) (4,347)
其他收益－淨額	Other gains – net
出售一家子公司產生的	Gain from disposal of a subsidiary (b)/(Note 38)
收益(b)╱（附註38）		46,000	–
出售物業、廠房和設備產生的	Losses on disposal of property, plant and
虧損	equipment	(384)	(55)
取消物業銷售合約獲得之賠償	Compensation for cancellation of property
	sales contracts	9,734 13,686
其他	Others	(9,080)	(5)
		46,270 13,626

(a) On 27 November 2013, the land use rights of new airport road project, owned by Changzhou Future Land Real Estate Development Co., Ltd., was recalled by Changzhou Xinbei Land Reserve Center. Total compensation for the requisition is RMB127,986,600 and after netting off the net book value of the assets, a gain of RMB81,375,000 was recognized.
(a) 於2013年11月27日，常州新城房產開發有限公司擁有的新機場公路項目的土地使用權由常州市新北國土儲備中心收回。徵用補償總額為人民幣127,986,600元，經扣除資產的賬面淨值後，人民幣81,375,000元收益獲確認。
(b) On 13 December 2013, the Group disposed of its 100% equity interests in Changzhou Future Land Guangchang Property Co., Ltd. to a third party, resulting in a gain of RMB46,000,000.
(b) 於2013年12月13日，本集團向第三方出售於常州新城廣場置業有限公司的100%股權，產生收益人民幣46,000,000元。
(c) The dividend income is from unlisted investment.
(c) 股息收入來自非上市投資。

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新城發展控股有限公司 Future Land Development Holdings Limited F-113 二零一三年年報 2013 Annual Report

– F-244 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

28 按性質劃分的開支

28 ExPENSES BY NATURE

計入銷售成本、銷售和營銷成本及行政開支的開支分析如下：

Expenses included in cost of sales, selling and marketing expenses and administrative expenses are analysed as follows:

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
土地使用權成本	Land use rights costs	4,770,651 4,025,794
建設成本	Construction costs	9,101,315 7,684,444
資本化利息	Capitalised interest	770,865 732,328
營業稅及附加費(a)	Business tax and surcharges (a)	1,166,306 977,980
完工待售物業減值撥備	Accrual of provision for properties held for sale	79,588 –
物業、廠房和設備折舊	Depreciation of property, plant and equipment
（附註7）	(Note 7)	19,453 19,977
無形資產攤銷（附註9）	Amortisation of intangible assets (Note 9)	2,418 1,531
銀行手續費	Bank charges	18,610 9,304
員工成本（附註30）	Staff costs (Note 30)	609,667 478,739
招待費	Entertainment expenses	72,568 68,393
印花稅及其他稅項	Stamp duty and other taxes	56,295 31,739
專業費用	Professional fees	6,714 32,436
核數師酬金	Auditors’ remuneration	3,200 3,280
銷售佣金	Sales commission	151,057 185,620
廣告及宣傳費用	Advertising and publicity costs	309,961 229,603
租賃開支	Rental expenses	36,820 21,897
差旅費用	Travelling expenses	27,805 9,451
其他開支	Other expenses	156,805 119,659
銷售成本、銷售和營銷成本及	Total cost of sales, selling and marketing expenses
行政開支總計	and administrative expenses	17,360,098 14,632,175

(a) 本集團的中國子公司須就其銷售物業收入和租金收入繳納5%的營業稅，而附加費則按應付營業稅的10%至12%繳納。

F-114 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-245 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

29 融資成本－淨額

29 FINANCE COSTS – NET

29 融資成本－淨額	29 FINANCE CO	STS – NET
		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
財務成本	Finance costs
－銀行貸款、優先票據、	– Interest on bank loans, senior notes,
信託融資安排和來自	trust financing arrangements and borrowings
其他金融機構的借款的	from other financial institutions
利息		(1,209,771) (1,015,746)
－減：資本化利息	– Less: Interest capitalised (Note 8 and Note 15)
（附註8及附註15）		682,959 856,034
		(526,812) (159,712)
－與借貸有關的匯兌收益淨額	– Net foreign exchange gains relating to borrowings	63,782 –
－與現金及現金等價物	– Net foreign exchange losses on cash and
有關的匯兌虧損淨額	cash equivalents	(53,663) –
融資成本總額（附註35）	Total finance costs (Note 35)	(516,693) (159,712)
財務收入	Finance income
－銀行存款的利息收入（附註35）– Interest income on bank deposits (Note 35)		121,793 48,052
融資成本淨額	Net finance costs	(394,900) (111,660)

30 員工成本（包含董事酬金）

30 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS)

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
工資和薪金	Wages and salaries	477,463 360,519
退休金	Pension	39,260 30,776
其他福利開支	Other welfare benefit expenses	67,203 50,747
首次公開發售前股份獎勵計劃	Pre-IPO share award scheme
－現任僱員價值（附註20）	– value of current employees (Note 20)	25,741 36,697
支銷利潤表（附註28）	Charged to statements of income (Note 28)	609,667 478,739
僱員數目	Number of employees	4,896 4,127

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新城發展控股有限公司 Future Land Development Holdings Limited F-115 二零一三年年報 2013 Annual Report

– F-246 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

30 員工成本（包含董事酬金）（續）

30 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS) (Cont’d)

根據有關規定，本集團按僱員工資總額的一定比例且在不超過規定上限的基礎上承擔保險費及福利計劃供款，並向勞動和社會保障機構繳納。

(a) 董事及主要行政人員的酬金

(a) Directors’ and chief executive’s emoluments

The directors’ and chief executive’s emoluments are set out below:

董事及主要行政人員的酬金列示如下：

						首次公開
			薪金及			發售前股份
		袍金	其他津貼	績效獎金	退休計劃供款	獎勵計劃	合計
			Salaries		Retirement	Pre-IPO
			and other	Performance	scheme	share award
董事姓名	Name of director	Fees	allowances	related bonus	contributions	scheme	Total
			人民幣千元	人民幣千元	人民幣千元	人民幣千元	人民幣千元
			RMB’000	RMB’000	RMB’000	RMB’000	RMB’000
截至2013年12月31日止年度	Year ended 31 December 2013
王先生(i)	Mr. Wang (i)	–	1,767	3,200	33	–	5,000
譚為民(ii)	Tan Weimin (ii)	–	720	–	30	–	750
閔遠松	Min Yuansong	–	1,160	3,300	40	1,203	5,703
劉源滿	Liu Yuanman	–	867	2,100	33	752	3,752
呂小平	Lv Xiaoping	–	1,367	3,100	33	1,805	6,305
黃茂莉	Huang Maoli	–	1,080	1,920	–	–	3,000
王曉松(iii)	Wang Xiaosong (iii)	–	1,367	3,100	33	1,203	5,703
聶梅生	Nie Meisheng	250	–	–	–	–	250
陳華康	Chen Huakang	250	–	–	–	–	250
朱增進	Zhu Zengjin	250	–	–	–	–	250
		750	8,328	16,720	202	4,963	30,963
截至2012年12月31日止年度	Year ended 31 December 2012
王先生(i)	Mr. Wang (i)	–	1,784	1,200	16	–	3,000
譚為民	Tan Weimin	–	507	960	33	1,148	2,648
閔遠松	Min Yuansong	–	944	1,140	16	1,837	3,937
劉源滿	Liu Yuanman	–	704	780	16	1,148	2,648
呂小平	Lv Xiaoping	–	1,424	960	16	2,756	5,156
黃茂莉	Huang Maoli	–	1,080	–	–	–	1,080
聶梅生	Nie Meisheng	23	–	–	–	–	23
陳華康	Chen Huakang	23	–	–	–	–	23
朱增進	Zhu Zengjin	23	–	–	–	–	23
		69	6,443	5,040	97	6,889	18,538

F-116 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-247 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

30 員工成本（包含董事酬金）（續）

(a) 董事及主要行政人員的酬金（續）

(i) 本公司的主要行政人員為王先生，其亦為本公司其中一名董事。
(ii) 譚為民先生於2013年10月18日辭任本公司執行董事。
(iii) 王曉松先生於2013年10月18日獲委任為本公司非執行董事。

(b) 五名最高薪人士

截至2013年12月31日止年度，本集團五名最高薪酬人士包括五名（2012年：三名）董事，彼等之酬金已於上文呈列的分析中反映。

(c) 截至2013年及2012年12月31日止年度，概無董事或任何五名最高薪人士向本集團收取任何酬金作為加盟或在加盟或離開本集團時的獎勵或補償或作為離職補償。

30 STAFF COSTS (INCLUDING DIRECTORS’ EMOLUMENTS) (Cont’d)

(a) Directors’ and chief executive’s emoluments (Cont’d)
(i) The chief executive of the Company is Mr. Wang, who is also one of the directors of the Company.
(ii) Mr. Tan Weimin resigned as executive director of the Company with effect from 18 October 2013.
(iii) Mr. Wang Xiaosong was appointed as a non-executive director of the Company with effect from 18 October 2013.

(b) Five highest paid individuals

The five individuals whose emoluments were the highest in the Group during the years ended 31 December 2013 include five (2012: three) whose emoluments are reflected in the analysis presented above.

(c) During the years ended 31 December 2013 and 2012, no director or any of the five highest paid individuals received any emolument from the Group as an inducement to join, upon joining the Group, leave the Group or as compensation for loss of office.

==> picture [21 x 302] intentionally omitted <==

F-117

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-248 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

31 所得稅開支

31 INCOME TAx ExPENSE

31 所得稅開支	31 INCOME TA	x ExPENSE
		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
當期所得稅	Current income tax
－中國土地增值稅	– PRC land appreciation tax	866,582 636,150
－中國企業所得稅	– PRC corporate income tax	761,242 535,545
		1,627,824 1,171,695
遞延所得稅（附註25）	Deferred income tax (Note 25)	(108,495) 61,082
年度列支的所得稅總額	Total income tax charged for the year	1,519,329 1,232,777

本集團除所得稅前利潤的所得稅有別於使用本集團旗下各公司所在國頒佈的稅率計算的理論金額，茲載列如下：

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
除所得稅前利潤	Profit before income tax	3,236,466 2,818,161
中國土地增值稅	PRC land appreciation tax	(866,582) (636,150)
		2,369,884 2,182,011
按25%法定稅率計算的所得稅	Income tax calculated at statutory rate of 25%	592,471 545,503
不可扣減開支(a)	Non-deductible expenses (a)	63,730 17,734
非課稅收入	Non-taxable income	(1,651) (1,260)
動用過往未確認的稅務虧損	Utilisation of previously unrecognised tax losses	(15,147) –
未確認為遞延稅項資產的	Tax losses not recognised as deferred tax assets
稅務虧損		570 22,845
過往年度稅項調整	Prior year tax adjustments	1,003 (832)
中國預扣稅	PRC withholding tax	11,771 12,637
中國土地增值稅	PRC land appreciation tax	866,582 636,150
所得稅開支總額	Total income tax expense	1,519,329 1,232,777

(a) 就所得稅而言，不可扣減開支主要來自優先票據的利息開支、有關股份獎勵的開支及不可扣減招待費的開支。

(a) Non-deductible expenses for income tax purposes mainly resulted from interest expense on senior notes, the expense in relation to the share award and non-deductible entertainment expense.

F-118 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-249 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

31 所得稅開支（續）

香港利得稅

本集團未對香港利得稅作出撥備，因為本集團於本年度並無來自香港的估計應課稅溢利（2012年：無）。

中國企業所得稅

根據中國企業所得稅法（「企業所得稅法」），本集團旗下於中國內地的子公司適用的企業所得稅率為 25%。

企業所得稅法及其實施細則規定中國居民企業就 2008年1月1日起產生的盈利向其中國境外的直接控股公司派發的股息須繳納10%的預扣稅，而於2008 年1月1日前產生的未分派盈利則獲豁免繳納該預扣稅。根據中國與香港訂立的稅務協約安排，若直接控股公司成立於香港，可應用較低的5%預扣稅稅率。截至2013年12月31日止年度，本集團就其中國實體產生的部份盈利按5%的稅率計提中國預扣稅撥備人民幣11,771,000元（2012年：人民幣12,637,000 元）。本集團能控制該等中國子公司的股息政策並已確定將不會於可見未來分派該等子公司的大部份盈利。

土地增值稅

中國土地增值稅以銷售物業所得款項減去可扣減開支
（包括土地使用權租賃費用及所有物業開發開支）的土地增值按介乎30%至60%的累進稅率徵收，並於合併利潤表內列作所得稅開支。

31 INCOME TAx ExPENSE (Cont’d)

Hong Kong profits tax

Hong Kong profits tax has not been provided for as the Group has no estimated assessable profits in Hong Kong during the year (2012: Nil).

PRc corporate income tax

Under the Corporate Income Tax Law of the PRC (“CIT Law”), the CIT rate applicable to the Group’s subsidiaries located in mainland China is 25%.

The CIT Law and its implementation rules impose a withholding tax at 10% for dividends distributed by a PRC-resident enterprise to its immediate holding company outside PRC for earnings generated beginning 1 January 2008 and undistributed earnings generated prior to 1 January 2008 are exempted from such withholding tax. A lower 5% withholding tax rate may be applied when the immediate holding companies are established in Hong Kong according to the tax treaty arrangement between the PRC and Hong Kong. For the year ended 31 December 2013, the Group accrued for PRC withholding tax with amount of RMB11,771,000 (2012: RMB12,637,000) based on the tax rate of 5% on a portion of the earnings generated by its PRC entities. The Group controls the dividend policies of these subsidiaries and it has been determined that it is probable that a majority of these earnings will not be distributed in the foreseeable future.

Land appreciation tax

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F-119

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-250 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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32 每股盈利

32 EARNINGS PER SHARE

每股基本盈利乃按本公司權益持有人應佔本集團利潤除以年內已發行普通股加權平均數計算。

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
本公司權益持有人應佔	Consolidated profit attributable to equity holders
合併利潤（人民幣千元）	of the Company (RMB’000)	981,262 930,819
已發行普通股加權平均數（千股）Weighted average number of ordinary shares
	in issue (’000)	5,668,000 4,368,167
每股基本盈利（人民幣元）	Basic earnings per share (RMB)	0.17 0.21

由於截至2013年及2012年12月31日止年度並無任何攤薄購股權和其他具潛在攤薄效應的已發行股份，故每股攤薄盈利與每股基本盈利相同。

As there were no dilutive options and other dilutive potential shares in issue during the years ended 31 December 2013 and 2012, diluted earnings per share is the same as basic earnings per share.

F-120 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-251 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

33 股息

33 DIVIDENDS

33 股息	33 DIVIDENDS
		截至12月31日止年度
		Year ended 31 December
		2013年	2012年
		2013	2012
		人民幣千元	人民幣千元
		RMB’000	RMB’000
擬派末期股息每股普通股	Proposed final dividend of RMB0.05
人民幣0.05元	(2012: RMB0.05) per ordinary share
（2012年：人民幣0.05元）		283,400	283,400

年內並無宣派中期股息（2012年：零）。

No interim dividend was declared during the year (2012: Nil).

於2014年3月17日舉行的董事會會議上，董事建議使用股份溢價賬派發2013年度末期股息每股普通股人民幣0.05元。擬派股息並無於此等財務報表反映為應付股息，惟待股東於本公司應屆股東週年大會批准後將反映為截至2014年12月31日止年度的股份溢價賬撥付。

At a Board meeting held on 17 March 2014, the directors proposed a final dividend for 2013 of RMB0.05 per ordinary share using the share premium account. This proposed dividend is not reflected as a dividend payable in these financial statements, but will be reflected as an appropriation of share premium for the year ending 31 December 2014 upon approval by the shareholders at the forthcoming annual general meeting of the Company.

於2013年5月22日舉行的本公司股東週年大會已批准 2012年末期股息每股普通股人民幣0.05元，共人民幣283,400,000元。該股息已於2013年內支付。

The final dividend in respect of 2012 of RMB0.05 per ordinary share, amounting to RMB283,400,000 was approved at the annual general meeting of the Company held on 22 May 2013. The amount was paid in 2013.

34 本公司擁有人應佔虧損

34 LOSS ATTRIBUTABLE TO OWNERS OF THE COMPANY

本公司於2010年4月23日註冊成立。截至2013年12 月31日止年度，本公司擁有人應佔虧損分別為人民幣225,822,000元（2012年：人民幣4,058,000元），已於本公司財務報表中入賬。

The Company was incorporated on 23 April 2010. The loss attributable to owners of the Company for the year ended 31 December 2013 amounted to RMB225,822,000 (2012: RMB4,058,000), which have been dealt with in the financial statements of the Company.

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新城發展控股有限公司 Future Land Development Holdings Limited F-121 二零一三年年報 2013 Annual Report

– F-252 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

35 經營活動（所用）╱所得現金 35 CASH (USED IN)/GENERATED FROM OPERATIONS

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		截至12月31日止年度
		Year ended 31 December
		2013年	2012年
		2013	2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
除所得稅前利潤	Profit before income tax	3,236,466 2,818,161
就下列各項作出調整：	Adjustments for:
－折舊（附註28）	– Depreciation (Note 28)	19,453	19,977
－攤銷（附註28）	– Amortisation (Note 28)	2,418	1,531
－出售物業、廠房和設備	– Losses on disposal of property, plant and
產生的虧損（附註27）	equipment (Note 27)	384	55
－出售一家子公司產生的收益	– Gains from disposal of a subsidiary (Note 27)
（附註27）		(46,000)	–
－首次公開發售前股份獎勵	– Pre-IPO share award scheme expenses (Note 20)
計劃支出（附註20）		25,741	36,697
－投資物業公允價值收益	– Fair value gains on investment properties (Note 8)
（附註8）		(37,839)	(31,086)
－就完工待售（或在建銷售）	– Accrual of provision for properties held
物業計提撥備（附註28）	(or under development) for sale (Note 28)	79,588	–
－完工待售（或在建銷售）	– Reversal of provision for properties held
物業撥備撥回	(or under development) for sale (Note 15)
（附註15）		(160,779) (132,988)
－應佔聯營公司業績	– Share of results of an associated company
（附註10）	(Note 10)	11,422	5,110
－可供出售金融資產股息收入	– Dividend income on available-for-sale financial
（附註27）	assets (Note 27)	(6,605)	(5,042)
－融資成本（附註29）	– Finance costs (Note 29)	526,812 159,712
－與借貸有關的匯兌收益淨額	– Net foreign exchange gains relating to borrowings	(63,782)	–
－與現金及現金等價物有關的	– Net foreign exchange losses on cash and
匯兌虧損淨額	cash equivalents	53,663	–
－利息收入（附註29）	– Interest income (Note 29)	(121,793)	(48,052)
營運資金變動	Changes in working capital
－與經營活動相關的受限制	– Restricted cash relating to operating activities
現金（附註18）	(Note 18)	(109,906) (603,964)
－租賃土地預付款項	– Prepayments for leasehold land	1,028,349 (1,624,692)
－完工待售或在建銷售物業	– Properties held or under development for sale
（不包括資本化利息）	(excluding capitalised interest)	(3,509,090) 642,330
－貿易及其他應收款項及	– Trade and other receivables and prepayments
預付款項		(646,673)	57,861
－預售物業預收款項	– Advances from pre-sale of properties	(1,428,827) (1,111,151)
－貿易和其他應付款項	– Trade and other payables	228,240 2,977,485
經營活動（所用）╱所得現金	Cash (used in)/generated from operations	(918,758) 3,161,944

F-122 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-253 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

35 經營活動（所用）╱所得現金（續）

35 CASH (USED IN)/GENERATED FROM OPERATIONS (Cont’d)

於合併現金流量表內，出售物業、廠房和設備的所得款項包括：

In the consolidated statement of cash flows, proceeds from disposal of property, plant and equipment comprise:

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013	2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
賬面淨值（附註7）	Net book value (Note 7)	16,043	890
出售物業、廠房和設備產生的	Losses on disposal of property,
虧損（附註27）	plant and equipment (Note 27)	(384)	(55)
出售一間子公司產生的虧損	Loss on disposal of a subsidiary	(79)	–
出售物業、廠房和設備所得款項	Proceeds from disposal of property,
	plant and equipment	15,580	835

36 承擔

36 COMMITMENTS

(a) 物業開發支出承擔

(a) Property development expenditure commitments

於2013年及2012年12月31日，尚未發生但已作出承擔的物業開發支出如下：

As at 31 December 2013 and 2012, property development expenditure committed but not yet incurred are as follows:

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		於12月31日	於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元		人民幣千元
		RMB’000		RMB’000
已訂約但未撥備	Contracted but not provided for	11,748,357		8,376,039

F-123

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-254 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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36 承擔（續）

36 COMMITMENTS (Cont’d)

(b) 經營租賃承擔

(b) Operating lease commitments

於2013年及2012年12月31日，就若干以不可撤銷經營租賃租入的辦公室樓宇而產生的未來最低租金支出總額需於以下期間支付：

As at 31 December 2013 and 2012, the future aggregate minimum rental expenses in respect of certain office buildings held under non-cancellable operating leases are payable in the following periods:

			於12月31日
			As at 31 December
			2013年	2012年
			2013	2012
			人民幣千元人民幣千元
			RMB’000	RMB’000
一年內	Within 1 year		12,234	13,399
一至五年	1 to 5 years		24,306	10,432
五年後	After 5 years		25,908	–
			62,448	23,831
(c)	投資承擔	(c)	Investment commitments
	於2013年及2012年12月31日，投資承擔如		As at 31 December 2013 and 2012,
	下：		committed investments are as follows:

As at 31 December 2013 and 2012, committed investments are as follows:

			於12月31日	於12月31日	於12月31日
			As at 31	December
			2013年		2012年
			2013		2012
			人民幣千元		人民幣千元
			RMB’000		RMB’000
可供出售金融資產的投資承擔	Committed	investments in available-for-sale
	financial	assets	15,000		55,000

F-124 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-255 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

36 承擔（續）

36 COMMITMENTS (Cont’d)

(d) 經營租賃應收租金

(d) Operating lease rentals receivable

於2013年及2012年12月31日，就土地及建築物以不可撤銷經營租賃租出而產生的未來最低租金收款總額將於以下期間收取：

As at 31 December 2013 and 2012, the future aggregate minimum rental receipts under non-cancellable operating leases in respect of land and buildings are receivable in the following periods:

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元	人民幣千元
		RMB’000		RMB’000
一年內	Within 1 year	83,349		54,217
一至五年	1 to 5 years	171,150		152,780
五年後	After 5 years	57,044		118,774
		311,543		325,771

37 財務擔保及或有負債

37 FINANCIAL GUARANTEES AND CONTINGENT LIABILITIES

(a) 按揭融資的擔保

(a) Guarantees on mortgage facilities

於2013年及2012年12月31日，本集團就按揭融資提供財務擔保產生的或然負債如下：

The Group had the following contingent liabilities in respect of financial guarantees on mortgage facilities as at 31 December 2013 and 2012:

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		於12月31日	於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
		人民幣千元		人民幣千元
		RMB’000		RMB’000
就本集團物業的若干買家的	Guarantees in respect of mortgage facilities for
按揭融資作出的擔保	certain purchasers of the Group’s properties	2,980,716		3,993,685

F-125

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-256 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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37 財務擔保及或有負債（續）

(a) 按揭融資的擔保（續）

(b) 公司擔保

於2013年及2012年12月31日，本集團的子公司就借款（附註22）相互提供若干企業擔保。董事認為各子公司有足夠財務資源償付其債務。

37 FINANCIAL GUARANTEES AND CONTINGENT LIABILITIES (Cont’d)

(a) Guarantees on mortgage facilities (Cont’d)

(b) corporate guarantees

There are certain corporate guarantees provided by the Group’s subsidiaries for each other in respect of borrowings (Note 22) as at 31 December 2013 and 2012. The directors consider that the subsidiaries are able to sufficiently financially resourced to settle their obligations.

F-126 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-257 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

38 出售子公司及業務

38 DISPOSAL OF SUBSIDIARIES AND BUSINESS

(a) 出售常州新城廣場置業有限公司

(a) Disposal of changzhou Future Land Guangchang Property co., Ltd.

於2013年12月13日，本集團以人民幣 125,156,000元出售於常州新城廣場置業有限公司的100%股權。

On 13 December 2013, the Group disposed of its 100% equity interests in Changzhou Future Land Guangchang Property Co., Ltd. at RMB125,156,000.

		人民幣千元
		RMB’000
已收現金	Cash received	90,000
與出售子公司相關的應收款項	Receivable in connection with the disposal of
	a subsidiary	35,156
總代價	Total consideration	125,156
出售淨資產	Net assets disposed of	79,156
出售所得收益	Gain on disposal	46,000

上述出售事項的資產與負債總額如下：

The aggregated assets and liabilities in respect of the above disposal were as follows:

		人民幣千元
		RMB’000
現金及現金等價物	Cash and cash equivalents	157
預付款項	Prepayments	6
貿易和其他應收款項	Trade and other receivables	41,545
完工待售或在建銷售物業	Properties held or under development for sale	38,022
物業、廠房和設備	Property, plant and equipment	79
遞延所得稅資產	Deferred income tax assets	4,716
貿易和其他應付款項	Trade and other payables	(5,369)
出售淨資產	Net assets disposed of	79,156
已收現金	Cash received	90,000
減：所出售子公司的現金及現金等價物	Less: Cash and cash equivalents in the
	subsidiary disposed of	(157)
出售事項的淨現金流入	Net cash inflow from the disposal	89,843

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F-127

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-258 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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39 關連方交易

(a) 關連方名稱及與關連方的關係

名稱

Name

王先生

Mr. Wang 王曉松先生 Mr. Wang Xiaosong 江蘇新城實業集團有限公司 Jiangsu Future Land Shiye Group. Ltd. 上海萬之城房地產開發有限公司 Shanghai Wan Zhi Cheng Real Estate Development Co., Ltd. 上海新城旭地房地產有限公司 Shanghai Xincheng Xudi Real Estate Co., Ltd. 香港宏盛發展有限公司 Hong Kong Prosperity Development Ltd. 香港創拓發展有限公司 Hong Kong Achievement Development Ltd. 豪泰環球有限公司 Heroic Time Global Ltd. 昇創有限公司 Exalt Creation Ltd. 香港鼎盛發展有限公司 Hong Kong Flourishing Development Ltd. 香港恒宇發展有限公司 Hong Kong Perpetual Development Ltd.

39 RELATED-PARTY TRANSACTIONS

(a) Name and relationship with related parties

關係

Relationship

本公司的控股股東及董事

The controlling shareholder and a director of the Company 王先生的家族成員 Family member of Mr. Wang 王先生控股的公司 A company controlled by Mr. Wang 本集團的聯營公司 An associated company of the Group 本集團的合營企業 A jointly controlled entity of the Group 本公司的子公司 A subsidiary of the Company 本公司的子公司 A subsidiary of the Company 本公司的子公司 A subsidiary of the Company 本公司的子公司 A subsidiary of the Company 本集團的子公司 A subsidiary of the Group 本集團的子公司 A subsidiary of the Group

F-128 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-259 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

39 關連方交易（續）

39 RELATED-PARTY TRANSACTIONS

(Cont’d)

(b) 與關連方的交易

(b) Transactions with related parties

本集團

Group

於截至2013年12月31日止年度，本集團進行了以下關連方交易：

During the year ended 31 December 2013, the Group has the following related party transactions:

截至12月31日止年度 Year ended 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000	截至12月31日止年度 Year ended 31 December 2013年 2012年 2013 2012 人民幣千元人民幣千元 RMB’000 RMB’000
(i)向關連方撥款 (i) Fundings to a related party －上海新城旭地房地產有限公司 – Shanghai Xincheng Xudi Real Estate Co., Ltd. 362,565	–
(ii)來自關連方的撥款 (ii) Fundings from a related party －上海萬之城房地產開發有限公司 – Shanghai Wan Zhi Cheng Real Estate Development Co., Ltd. 230,000	–
(iii)銷售服務 (iii) Sales of services －上海萬之城房地產開發有限公司 – Shanghai Wan Zhi Cheng Real Estate Development Co., Ltd. 3,240	–
(iv)負債轉讓 (iv) Transfer of liabilities －江蘇新城實業集團有限公司 – Jiangsu Future Land Shiye Group. Ltd. –	44,000
(v)與非控股權益進行的交易所得的收益（附註40） (v) Gain from transaction with non-controlling interests (Note 40) －王先生及王曉松先生 – Mr. Wang and Mr. Wang Xiaosong 246,942	–

(vi) Occupation of properties owned by a related party

(vi) 佔用關連方擁有的物業

Some subsidiaries of the Group occupied certain properties with total gross floor areas of 720 square meters owned by Mr. Wang Xiaosong for operational use, which is free of charge (Same for the year ended 31 December 2013).

本集團若干子公司佔用王曉松先生擁有的總建築面積為720平方米的若干物業作營運用途，且毋須支付任何費用。（與截至2013年12月31日止年度相同）

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-129 二零一三年年報 2013 Annual Report

– F-260 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

39 關連方交易（續）

39 RELATED-PARTY TRANSACTIONS

(Cont’d)

==> picture [21 x 302] intentionally omitted <==

(b) Transactions with related parties (Cont’d)

(b) 與關連方的交易（續）

(vii) Key management compensation

(vii) 主要管理層報酬

主要管理層包括董事（執行和非執行）、財務總監、副總裁和總裁助理。就員工服務已付或應付予主要管理層之報酬列示如下：

		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
薪金及其他短期僱員福利	Salaries and other short-term employee benefits	45,263 36,597
離職後福利	Post-employment benefits	– 48
		45,263 36,645
本公司		company
		截至12月31日止年度
		Year ended 31 December
		2013年 2012年
		2013 2012
		人民幣千元人民幣千元
		RMB’000 RMB’000
(i)向關連方撥款	(i) Fundings to a related party
－香港宏盛發展有限公司	– Hong Kong Prosperity Development Ltd.	2,970,844 717,787
－香港創拓發展有限公司	– Hong Kong Achievement Development Ltd.	143,441 –
		3,114,285 717,787
(ii)替關連方墊支	(ii) Paid on behalf of a related party
－豪泰環球有限公司	– Heroic Time Global Ltd.	11 –
－昇創有限公司	– Exalt Creation Ltd.	11 –
－香港鼎盛發展有限公司	– Hong Kong Flourishing Development Ltd.	10 –
－香港恒宇發展有限公司	– Hong Kong Perpetual Development Ltd.	10 –
－香港創拓發展有限公司	– Hong Kong Achievement Development Limited	– 60
		42 60

F-130 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-261 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

39 關連方交易（續）

39 RELATED-PARTY TRANSACTIONS

(Cont’d)

(c) 關連方結餘
(c) Related-party balances

	(c) 關連方結餘	(c)	Related	-party balance	s
	本集團		Group
				於12月31日
				As at 31	December
				2013年		2012年
				2013		2012
				人民幣千元	人民幣千元
				RMB’000		RMB’000
(i)	應收關連方款項（附註16）	(i) Amount due from a related party (Note 16)
	－上海新城旭地房地產	– Shanghai Xincheng Xudi Real Estate Co., Ltd.
	有限公司			362,565		–
	－上海萬之城房地產開發	– Shanghai Wan Zhi Cheng Real Estate
	有限公司	Development Co., Ltd.		–		180,000
				362,565		180,000
(ii)	應付關連方款項（附註24）	(ii) Amount due to a related party (Note	24)
	－上海萬之城房地產開發	– Shanghai Wan Zhi Cheng Real Estate
	有限公司	Development Co., Ltd.		50,000		–

本公司

company

				於12月31日	於12月31日
				As at 31	December
				2013年		2012年
				2013		2012
				人民幣千元	人民幣千元
				RMB’000		RMB’000
(i)	應收關連方款項（附註16）	(i)	Amounts due from related parties (Note 16)
	－香港宏盛發展有限公司		– Hong Kong Prosperity Development Ltd.	3,688,631		717,787
	－香港創拓發展有限公司		– Hong Kong Achievement Development Limited	143,501		60
	－豪泰環球有限公司		– Heroic Time Global Ltd.	11		–
	－昇創有限公司		– Exalt Creation Ltd.	11		–
	－香港鼎盛發展有限公司		– Hong Kong Flourishing Development Ltd.	10		–
	－香港恒宇發展有限公司		– Hong Kong Perpetual Development Ltd.	10		–
				3,832,174		717,847

應收和應付關連方款項均無抵押、免息並需在獲通知後償還。

The amounts due from and due to related parties are unsecured, bear no interest and are repayable on demand.

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-131 二零一三年年報 2013 Annual Report

– F-262 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

40 與非控制權益進行的交易

於2013年9月23日，本集團注入資本人民幣 200,000,000元以收購常州新城萬德投資有限公司（「萬德」）的90.91%股權，萬德為一家由常州新城萬博投資有限公司分拆的公司，由王振華先生及王曉松先生全資擁有，惟由於其原有總繳足資本人民幣 20,000,000元，故其並非本集團子公司。萬德直接持有本集團子公司常州富域發展有限公司（「常州富域」）的6.22%股權。交易後，萬德成為本集團子公司，及常州富域的非控制權益比例由6.22%減少至 0.57%。任何已付代價公允價值與所購買相關應佔常州富域淨資產賬面值人民幣246,942,000元的差額在其他儲備中列作收益。

40 TRANSACTIONS WITH NON-CONTROLLING INTERESTS

On 23 September 2013, the Group injected a capital of RMB200,000,000 to acquire 90.91% equity interest of Changzhou Future Land Wande Investment Co., Ltd. (“Wande”), a company spinned off from Changzhou Future Land Wanbo Investment Co., Ltd., which is wholly owned by Mr. Wang Zhenhua and Mr. Wang Xiaosong, but not a subsidiary of the Group, with its original total paid-in capital of RMB20,000,000. Wande directly holds 6.22% equity interest of Changzhou Wealthzone Development Co., Ltd. (“Changzhou Wealthzone”), a subsidiary of the Group. After the transaction, Wande became the subsidiary of the Group, and the non-controlling interest portion of Changzhou Wealthzone decreased from 6.22% to 0.57%. The difference between fair value of consideration paid and the relevant share acquired of the carrying value of net assets of Changzhou Wealthzone of RMB246,942,000 representing a gain is recorded in other reserves.

F-132 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-263 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情

41 PARTICULARS OF SUBSIDIARIES

本集團子公司於2013年及2012年12月31日的詳情載列如下：

Particulars of the subsidiaries of the Group as at 31 December 2013 and 2012 are as follows:

於12月31日應佔股權百分比

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
江蘇新城物業服務有限公司	1996年3月26日	5,000	5,000	56.94%	53.70%	物業管理
Jiangsu Future Land Property	26 March 1996					Property management
Management Co., Ltd.
新城控股集團有限公司	1996年6月14日	600,000	600,000	97.15%	91.62%	物業開發及銷售
Future Land Holdings Co., Ltd.	14 June 1996					Development and sale of
						properties
江蘇新城地產股份有限公司	1997年10月10日	1,593,187	1,593,187	57.18%	53.93%	物業開發及銷售
Jiangsu Future Land Co., Ltd.	10 October 1997					Development and sale of
						properties
常州新城房產開發有限公司(a)	1998年4月26日	1,100,000	1,100,000	54.78%	51.66%	物業開發及銷售
Changzhou Future Land Real	26 April 1998					Development and sale of
Estate Development Co., Ltd.(a)						properties
常州富域發展有限公司	2002年4月27日	321,800	321,800	99.43%	93.78%	物業開發及銷售
Changzhou Wealthzone	27 April 2002					Development sale of
Development Co., Ltd.						properties
南京新城創置房地產有限公司	2002年9月9日	120,000	120,000	55.02%	51.89%	物業開發及銷售
Nanjing Future Land Chuangzhi	9 September 2002					Development and sale of
Real Estate Co., Ltd.						properties
上海新城創置房地產有限公司	2003年1月29日	10,000	10,000	55.02%	51.89%	物業開發及銷售
Shanghai Future Land Chuangzhi	29 January 2003	(2012:	(2012:			Development and sale of
Real Estate Co., Ltd.		210,000)	210,000)			properties

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-133 二零一三年年報 2013 Annual Report

– F-264 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
上海新城萬嘉房地產有限公司	2003年3月19日	410,000	410,000	55.02%	51.89%	物業開發及銷售
Shanghai Future Land Wanjia Real	19 March 2003					Development and sale of
Estate Co., Ltd.						properties
上海新城萬嘉物業服務有限公司	2003年11月27日	500	500	56.75%	53.52%	物業管理
Shanghai Future Land Wanjia	27 November 2003					Property management
Property Service Co., Ltd.
常州新龍創置房地產開發	2004年9月16日	350,000	350,000	56.70%	53.48%	物業開發及銷售
有限公司(a)	16 September 2004					Development and sale of
Changzhou Xinlong Chuangzhi						properties
Real Estate Development
Co., Ltd. (a)
蘇州新城萬嘉房地產有限公司	2004年9月17日	100,000	100,000	55.02%	51.89%	物業開發及銷售
Suzhou Future Land Wanjia Real	17 September 2004					Development and sale of
Estate Co., Ltd.						properties
常州新城萬嘉建築設計有限公司	2005年5月20日	3,000	3,000	55.74%	52.57%	建築設計及諮詢
Changzhou Future Land Wan Jia	20 May 2005					Construction design and
Construction Design Co., Ltd.						consulting
常州鼎佳房地產開發有限公司	2005年5月27日	10,000	10,000	55.09%	51.96%	物業開發及銷售
Changzhou Dingjia Property Real	27 May 2005	(2012:	(2012:			Development and sale of
Estate Development Co., Ltd.		100,000)	100,000)			properties
常州新城東郡房地產開發有限公司	2005年12月27日	10,000	10,000	56.99%	53.75%	物業開發及銷售
Changzhou Future Land Dongjun	27 December 2005	(2012:	(2012:			Development and sale of
Real Estate Development		100,000)	100,000)			properties
Co., Ltd.

F-134 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-265 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES

(Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
昆山新城創置發展有限公司	2006年4月7日	290,000	290,000	54.83%	51.71%	物業開發及銷售
Kunshan Future Land Chuangzhi	7 April 2006	(2012:	(2012:			Development and sale of
Development Co., Ltd.		300,000)	300,000)			properties
常州新城資產經營管理有限公司	2006年10月24日	1,000	1,000	56.94%	53.70%	資產運營及管理
Changzhou Future Land Assets	24 October 2006					Asset operation and
Operation and Management						management
Co., Ltd.
常州新城置地房地產開發有限公司	2006年12月13日	10,000	10,000	54.78%	51.66%	物業開發及銷售
Changzhou Future Land Zhidi Real	13 December 2006	(2012:	(2012:			Development and sale of
Estate Development Co., Ltd.		90,000)	90,000)			properties
常州新城廣場置業有限公司	2006年12月13日	62,000	62,000	–	91.62%	物業開發及銷售
Changzhou Future Land	13 December 2006					Development and sale of
Guangchang Property Co., Ltd.						properties
常州嘉馳汽車配件有限公司	2007年1月16日	15,000	15,000	54.78%	51.66%	物業市場調研
（原常州嘉楓市場調查有限公司）	16 January 2007					Marketing research of
Changzhou Jia Chi Auto Parts						properties
Co., Ltd.
常州萬方新城房地產開發有限公司	2007年2月6日	650,000	650,000	54.84%	51.72%	物業開發及銷售
Changzhou Wanfang Future	6 February 2007	(2012:	(2012:			Development and sale of
Land Real Estate Development		30,000)	30,000)			properties
Co., Ltd.

==> picture [21 x 302] intentionally omitted <==

F-135

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-266 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES

(Cont’d)

==> picture [21 x 302] intentionally omitted <==

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
常州福隆房地產開發有限公司	2007年2月6日	220,000	220,000	97.15%	91.62%	物業開發及銷售
Changzhou Fu Long Real Estate	6 February 2007					Development and sale of
Development Co., Ltd.						properties
常州新城萬博置業有限公司	2007年5月16日	165,000	165,000	97.15%	91.62%	物業開發及銷售
Changzhou Future Land Wanbo	16 May 2007	(2012:	(2012:			Development and sale of
Property Co., Ltd.		615,000)	615,000)			properties
上海東郡房地產開發有限公司(a)	2007年5月31日	400,000	400,000	57.18%	53.93%	物業開發及銷售
Shanghai Dongjun Real Estate	31 May 2007					Development and sale of
Development Co., Ltd. (a)						properties
無錫新城萬嘉置業有限公司	2007年8月14日	420,000	420,000	57.18%	53.93%	物業開發及銷售
Wuxi Future Land Wanjia Property	14 August 2007					Development and sale of
Co., Ltd.						properties
蘇州新城創佳置業有限公司	2007年10月11日	500,000	500,000	57.18%	53.93%	物業開發及銷售
Suzhou Future Land Chuangjia	11 October 2007					Development and sale of
Property Co., Ltd.						properties
常州萬嘉置業諮詢有限公司	2008年1月18日	1,000	1,000	57.18%	53.93%	諮詢服務
Changzhou Wanjia Property	18 January 2008					Consulting
Consultancy Co., Ltd.

F-136 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-267 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）


41 子公司詳情（續）			41	PARTICULARS OF SUBSIDIARIES
				(Cont’d)
				於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
					31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本		2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital		capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
新城萬博置業有限公司	2008年1月24日	220,000	220,000		97.15%	91.62%	物業開發及銷售
Future Land Wanbo Property	24 January 2008						Development and sale of
Co., Ltd.							properties
上海新城創佳置業有限公司	2008年3月20日	760,000	760,000		55.02%	51.89%	物業開發及銷售
Shanghai Future Land Chuangjia	20 March 2008						Development and sale of
Property Co., Ltd.							properties
常州新城東昇房地產有限公司	2009年6月4日	360,000	360,000		56.99%	53.75%	物業開發及銷售
Changzhou Future Land	4 June 2009						Development and sale of
Dongsheng Real Estate Co., Ltd.							properties
南京新城創嘉房地產有限公司	2009年7月2日	18,000		18,000	55.02%	51.89%	物業開發及銷售
Nanjing Future Land Chuangjia	2 July 2009						Development and sale of
Real Estate Co., Ltd.							properties
常州新城金郡房地產有限公司(a)	2009年9月11日	700,000	700,000		54.78%	51.66%	物業開發及銷售
Changzhou Future Land Jinjun	11 September 2009	(2012:		(2012:			Development and sale of
Real Estate Co., Ltd. (a)		470,000)	470,000)				properties
常州市恒福置業有限公司(a)	2009年11月26日	20,000		20,000	54.78%	51.66%	物業開發及銷售
Changzhou Hengfu Property	26 November 2009						Development and sale of
Co., Ltd. (a)							properties
常州新城萬佳房地產有限公司(a)	2009年12月10日	700,000	700,000		54.78%	51.66%	物業開發及銷售
Changzhou Future Land Wanjia	10 December 2009						Development and sale of
Real Estate Co., Ltd. (a)							properties

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-137 二零一三年年報 2013 Annual Report

– F-268 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
常州新城宏業房地產有限公司	2009年12月28日	800,000	800,000	97.15%	91.62%	物業開發及銷售
Changzhou Future Land Hongye	28 December 2009					Development and sale of
Real Estate Co., Ltd.						properties
南京新城萬嘉房地產有限公司	2010年1月13日	310,000	310,000	55.02%	51.89%	物業開發及銷售
Nanjing Future Land Wanjia Real	13 January 2010					Development and sale of
Estate Co., Ltd.						properties
常州新城創佳房地產開發有限公司	2010年1月22日	520,000	520,000	55.02%	51.89%	物業開發及銷售
Changzhou Future Land Chuangjia	22 January 2010					Development and sale of
Real Estate Co., Ltd.						properties
上海新城創宏房地產有限公司	2010年1月26日	10,000	10,000	55.02%	51.89%	物業開發及銷售
Shanghai Future Land Chuanghong	26 January 2010	(2012:	(2012:			Development and sale of
Real Estate Co., Ltd.		420,000)	420,000)			properties
常州新城科達投資諮詢有限公司	2010年2月4日	500	500	97.15%	91.62%	諮詢服務
Changzhou Future Land Keda	4 February 2010					Consulting
Investment Consultancy Co., Ltd.
常州新城經典建築設計有限公司	2010年2月4日	500	500	97.15%	91.62%	物業開發及銷售
Changzhou Future Land Jingdian	4 February 2010					Development and sale of
Architectural Design Co., Ltd.						properties
上海新城金郡房地產有限公司	2010年3月26日	820,000	820,000	55.02%	51.89%	物業開發及銷售
Shanghai Future Land Jinjun Real	26 March 2010					Development and sale of
Estate Co., Ltd.						properties

F-138 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-269 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
無錫新城創置房地產有限公司(a)	2010年5月6日	500,000	500,000	57.18%	53.93%	物業開發及銷售
Wuxi Future Land Chuangzhi Real	6 May 2010	(2012:	(2012:			Development and sale of
Estate Co., Ltd. (a)		200,000)	200,000)			properties
常州新城萬盛房地產有限公司	2010年6月12日	120,000	120,000	97.53%	91.98%	物業開發及銷售
Changzhou Future Land	12 June 2010					Development and sale of
Wansheng Real Estate Co., Ltd.						properties
香港宏盛發展有限公司(b)	2010年8月30日	10	–	100%	100%	投資公司
Hong Kong Prosperity	30 August 2010					Investment company
Development Ltd. (b)
香港創拓發展有限公司(b)	2010年8月30日	10	3	100%	100%	投資公司
Hong Kong Achievement	30 August 2010					Investment company
Development Limited (b)
常州新城吾悅商業管理有限公司	2010年11月8日	10,000	10,000	97.15%	91.62%	物業開發及銷售
Changzhou Future Land Injoy	8 November 2010					Development and sale of
Commercial Management						properties
Co., Ltd.
上海新城萬聖置業有限公司	2010年11月10日	10,000	10,000	97.15%	91.62%	物業開發及銷售
Shanghai Future Land Wansheng	10 November 2010					Development and sale of
Property Co., Ltd.						properties
南京新城允升房地產有限公司	2010年11月19日	860,000	860,000	55.02%	51.89%	物業開發及銷售
Nanjing Future Land Yunsheng	19 November 2010					Development and sale of
Real Estate Co., Ltd.						properties

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-139 二零一三年年報 2013 Annual Report

– F-270 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
常州新城宏業百貨有限公司	2010年11月30日	10,000	10,000	97.15%	91.62%	百貨商店管理
Changzhou Future Land Hongye	30 November 2010					Department store
Baihuo Co., Ltd.						management
無錫新城萬博置業有限公司	2011年1月6日	500,000	500,000	97.24%	91.17%	物業開發及銷售
Wuxi Future Land Wanbo Property	6 January 2011					Development and sale of
Co., Ltd.						properties
金壇市新城萬郡置業有限公司	2011年3月22日	10,000	10,000	75.96%	71.64%	物業開發及銷售
Jintan Future Land Wanjun	22 March 2011					Development and sale of
Property Co., Ltd.						properties
長沙新城萬博置業有限公司	2011年3月28日	420,000	420,000	97.15%	91.62%	物業開發及銷售
Changsha Future Land Wanbo	28 March 2011					Development and sale of
Property Co., Ltd.						properties
常州吾悅百貨有限公司	2011年4月22日	500	500	97.15%	91.62%	百貨商店管理
Changzhou Injoy Baihuo Co., Ltd.	22 April 2011					Department store
						management
上海新城創域房地產有限公司	2011年5月10日	589,000	589,000	55.02%	51.89%	物業開發及銷售
Shanghai Future Land Chuangyu	10 May 2011	(2012:	(2012:			Development and sale of
Real Estate Co., Ltd.		30,000)	30,000)			properties
昆山新城創宏房地產有限公司	2011年6月20日	460,000	460,000	57.18%	53.93%	物業開發及銷售
Kunshan Future Land Chuanghong	20 June 2011	(2012:	(2012:			Development and sale of
Real Estate Co., Ltd.		370,000)	370,000)			properties

F-140 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-271 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）


41 子公司詳情（續）			41	PARTICULARS OF SUBSIDIARIES
				(Cont’d)
				於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
					31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本		2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital		capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
昆山新城創域房地產有限公司	2011年6月23日	100,000	100,000		77.16%	72.78%	物業開發及銷售
Kunshan Future Land Chuangyu	23 June 2011						Development and sale of
Real Estate Co., Ltd.							properties
常州新城瑞壹國際酒店有限公司	2011年9月7日	1,000		1,000	54.78%	51.66%	物業、酒店和會議管理以
Changzhou Future Land Rui Yi	7 September 2011						及公寓租賃服務
International Co., Ltd.							Property, hotel
							and conference
							management;
							apartment leasing
							services
常州嘉楓市場調查有限公司	2011年9月15日	5,000		5,000	54.78%	51.66%	物業市場調研
Changzhou Jiafeng Market	15 September 2011						Marketing research of
Research Co., Ltd.							properties
長沙萬博物業管理有限公司	2011年9月21日	–		–	–	91.62%	物業管理
Changsha Wanbo Property	21 September 2011	(2012:		(2012:			Property management
Management Co., Ltd.		500)		500)
常州吾悅國際廣場商業管理有限	2012年4月5日	5,000		5,000	97.15%	91.62%	百貨商店管理
公司	5 April 2012						Department store
Changzhou Injoy International							management
Plaza Commercial Management
Co., Ltd.
武漢新城宏盛置業有限公司	2012年5月9日	400,000	400,000		97.15%	91.62%	物業開發及銷售
Wuhan Future Land Hongsheng	9 May 2012						Development and sale of
Property Co., Ltd.							properties

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-141 二零一三年年報 2013 Annual Report

– F-272 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
上海富銘房地產開發有限公司*	2009年9月7日	638,000	638,000	55.02%	51.89%	物業開發及銷售
Shanghai Fuming Real Estate	7 September 2009	(2012:	(2012:			Development and sale of
Development Co., Ltd.		338,000)	338,000)			properties
常州凱盛房地產發展有限公司	2012年6月19日	–	–	–	99.16%	物業開發及銷售
Changzhou Kaisheng Real Estate	19 June 2012	(2012:	(2012:			Development and sale of
Co., Ltd.		20,000)	20,000)			properties
蘇州新城創恒房地產有限公司	2012年8月13日	300,000	300,000	57.18%	53.93%	物業開發及銷售
Suzhou Future Land Chuangheng	13 August 2012	(2012:	(2012:			Development and sale of
Real Estate Co., Ltd		20,000)	20,000)			properties
上海青浦吾悅商業管理有限公司	2012年12月31日	5,000	5,000	97.15%	91.62%	百貨商店管理
Shanghai Qingpu Injoy	31 December 2012					Department store
Commercial Management						management
Co., Ltd.
上海新城寶郡置業有限公司	2013年1月16日	360,000	360,000	55.02%	–	物業開發及銷售
Shanghai Future Land Baojun	16 January 2013					Development and sale of
Property Co., Ltd.						properties
常州萬盛商業管理有限公司	2013年1月22日	450,000	450,000	97.15%	–	百貨商店管理
Changzhou Wansheng Property	22 January 2013					Department store
Management Co., Ltd.						management
南京新城創隆房地產有限公司	2013年3月14日	550,000	550,000	55.02%	–	物業開發及銷售
Nanjing Future Land Chuanglong	14 March 2013					Development and sale of
Real Estate Co., Ltd.						properties

F-142 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-273 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）


41 子公司詳情（續）			41	PARTICULARS OF				SUBSIDIARIES
				(Cont’d)
					於12月31日應佔股權百分比
					Percentage of attributable
					equity interest as at
						31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本			2013年	2012年		主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital		capital		2013	2012		Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
常州匯盛房地產發展有限公司	2013年5月15日	452,000	180,802			98.57%		–	物業開發及銷售
Changzhou Future Land Huisheng	15 May 2013								Development and sale of
Development Co., Ltd.									properties
常州悅盛房地產發展有限公司	2013年5月15日	612,000	612,000			98.57%		–	物業開發及銷售
Changzhou Future Land Yuesheng	15 May 2013								Development and sale of
Development Co., Ltd.									properties
常州卓盛房地產發展有限公司	2013年5月15日	756,000	303,309			98.57%		–	物業開發及銷售
Changzhou Future Land	15 May 2013								Development and sale of
Zhuosheng Development									properties
Co., Ltd.
豪泰環球有限公司(b)	2013年5月28日	300		–	100.00%			–	投資公司
Heroic Time Global Limited (b)	28 May 2013								Investment company
鎮江新城凱盛開發有限公司	2013年6月7日	270,000	270,000		100.00%			–	物業開發及銷售
Zhenjiang Future Land Kaisheng	7 June 2013								Development and sale of
Development Co., Ltd.									properties
蘇州凱拓房地產發展有限公司	2013年6月20日	1,228,800	1,122,577		36.62% (c)			–	物業開發及銷售
Suzhou Future Land Kaituo	20 June 2013								Development and sale of
Development Co., Ltd.									properties
蘇州博盛房地產發展有限公司	2013年6月20日	450,000	170,013		100.00%			–	物業開發及銷售
Suzhou Future Land Bosheng	20 June 2013								Development and sale of
Development Co., Ltd.									properties
昇創有限公司(b)	2013年6月27日	300		–	100.00%			–	投資公司
Exalt Creation Limited (b)	27 June 2013								Investment company

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-143 二零一三年年報 2013 Annual Report

– F-274 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

				於12月31日應佔股權百分比	於12月31日應佔股權百分比
				Percentage of attributable
				equity interest as at
				31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本	2013年	2012年	主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital	capital	2013	2012	Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
蘇州新城創盛置業有限公司	2013年7月1日	30,000	30,000	40.03% (d)	–	物業開發及銷售
Suzhou Future Land Chuangsheng	1 July 2013					Development and sale of
Property Co., Ltd.						properties
香港鼎盛發展有限公司(b)	2013年7月16日	8	–	100.00%	–	投資公司
Hong Kong Flourishing	16 July 2013					Investment company
Development Limited (b)
香港恒宇發展有限公司(b)	2013年7月16日	8	–	100.00%	–	投資公司
Hong Kong Perpetual	16 July 2013					Investment company
Development Limited (b)
蘇州吾悅商業管理有限公司	2013年7月19日	5,000	5,000	97.15%	–	百貨商店管理
Suzhou Injoy Commercial	19 July 2013					Department store
Management Co., Ltd.						management
常州德潤諮詢管理有限公司	2013年8月28日	2,000	2,000	100.00%	–	諮詢服務
Changzhou Derun Consultancy	28 August 2013					Consulting
Co., Ltd.
常州新城萬德投資有限公司	2013年9月9日	220,000	220,000	90.91%	–	投資公司
Changzhou Future Land Wande	9 September 2013					Investment company
Investment Co., Ltd.
杭州新城創宏房地產開發有限公司	2013年9月27日	320,000	320,000	57.18%	–	物業開發及銷售
Hangzhou Future Land	27 September 2013					Development and sale of
Chuanghong Real Estate						properties
Development Co., Ltd.
杭州新城鼎宏房地產開發有限公司	2013年10月8日	100,000	100,000	57.18%	–	物業開發及銷售
Hangzhou Future Land Dingghong	8 October 2013					Development and sale of
Real Estate Development						properties
Co., Ltd.

F-144 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-275 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）


41 子公司詳情（續）			41	PARTICULARS OF				SUBSIDIARIES
				(Cont’d)
					於12月31日應佔股權百分比
					Percentage of attributable
					equity interest as at
						31 December
		法定或	已發行和
公司名稱	註冊成立╱成立日期	註冊資本	繳足股本			2013年	2012年		主要業務
	Date of	Authorised	Issued and
	incorporation/	or registered	fully paid
company name	establishment	capital		capital		2013	2012		Principal activities
		人民幣千元	人民幣千元
		RMB’000	RMB’000
張家港鼎盛房地產有限公司	2013年10月25日	720,000	365,355		100.00%			–	物業開發及銷售
Zhangjiagang Future Land	25 October 2013								Development and sale of
Dingsheng Real Estate Co., Ltd.									properties
杭州新城創盛房地產開發有限公司	2013年11月6日	100,000	100,000			57.18%		–	物業開發及銷售
Hangzhou Future Land	6 November 2013								Development and sale of
Chuangsheng Real Estate									properties
Development Co., Ltd.
丹陽新城宏盛房地產發展有限公司	2013年11月5日	450,000	306,585		100.00%			–	物業開發及銷售
Danyang Future Land Hongsheng	5 November 2013								Development and sale of
Real Estate Development									properties
Co., Ltd.
常州賽褔諮詢管理有限公司	2013年11月27日	122,216	122,216		100.00%			–	諮詢服務
Changzhou Saifu Consultancy	27 November 2013								Consulting
Co., Ltd.
昆山新城萬龍房地產發展有限公司	2013年12月31日	10,000		10,000		54.83%		–	物業開發及銷售
Kunshan Future Land Wanlong	31 December 2013								Development and sale of
Real Estate Development									properties
Co., Ltd.

於2012年5月16日，本集團以代價人民幣311,157,000元收購上海富銘房地產開發有限公司（「上海富銘」）100%股權。董事認為，此項收購實質屬於資產收購，而並非業務合併，因此作為資產收購入賬。
On 16 May 2012, the Group acquired 100% equity interest in Shanghai Fuming Real Estate Development Co., Ltd. (“Shanghai Fuming”), at a consideration of RMB311,157,000. The directors consider this acquisition is an asset acquisition in substance rather than a business combination and therefore is accounted for as an asset acquisition.

==> picture [21 x 302] intentionally omitted <==

新城發展控股有限公司 Future Land Development Holdings Limited F-145 二零一三年年報 2013 Annual Report

– F-276 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

==> picture [21 x 302] intentionally omitted <==

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

(a) Certain equity interests in the subsidiaries of the Company were pledged for borrowings as at 31 December 2013 and 2012, respectively (Note 22). For details, please refer to the table below:
(a) 於2013年及2012年12月31日，本公司子公司若干股權已就借款予以抵押（附註22）。有關詳情，請參閱下表：

		於12月31日	於12月31日
		As at 31	December
		2013年		2012年
		2013		2012
江蘇新城地產股份有限公司	Number of legal person shares of Jiangsu Future
法人股數目	Land Co., Ltd.	50,000,000	874,500,000
上海東郡房地產開發有限公司	Percentage of equity interests in Shanghai
股權百分比	Dongjun Real Estate Development Co., Ltd.	–		100%
常州市恒福置業有限公司	Percentage of equity interests in Changzhou
股權百分比(i)	Hengfu Property Co., Ltd. (i)	100%		100%
常州新城房產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Real Estate Development Co., Ltd.	–		70%
無錫新城創置房地產有限公司	Percentage of equity interests in Wuxi Future
股權百分比	Land Chuangzhi Real Estate Co., Ltd.	–		100%
常州新城萬佳房地產開發有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Wanjia Real Estate Co., Ltd.	–		100%
常州新城金郡房地產有限公司	Percentage of equity interests in Changzhou
股權百分比	Future Land Jinjun Real Estate Co., Ltd.	–		100%

(i) The equity interests in Changzhou Hengfu Property Co., Ltd. were pledged for bank borrowing. Other than this, all other equity interests pledged were for trust financing arrangements.

(i) 常州市恒福置業有限公司股權已就銀行借款予以抵押，除此之外，所抵押的所有其他股權均就信託融資安排予以抵押。

F-146 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-277 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

(b) 本公司於該等子公司直接或間接擁有股權，而該等子公司於其他子公司直接或間接擁有股權。該等子公司於香港成立，而所有其他子公司於中國內地成立。所有子公司均為有限公司。
(c) 於2013年6月20日，本集團成立蘇州凱拓房地產發展有限公司，原註冊資本為 75,000,000美元。根據合作發展協議，第三方投資者其後注資129,800,000美元。經注資後，本集團於蘇州凱拓房地產發展有限公司的持股下跌至36.62%，而本集團享有65%的經營業績。

項目公司的營運環境和架構需要所有主要財務和營運政策在第三方投資者訂立前釐定。項目公司在任何重大方面不可以偏離其核定目的和設計。同時，根據多份法律文件（包括項目公司組織章程細則、投資協議及與第三方投資者訂立的其他協議），本集團保留在項目公司日常業務過程中和日常管理過程中對項目公司營運和管理的權力。

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

(b) The Company has direct or indirect equity interests in these subsidiaries which have direct or indirect equity interests in the other subsidiaries. These subsidiaries were incorporated in Hong Kong and all the other subsidiaries were established in mainland China. All the subsidiaries are limited liability companies.
(c) On 20 June 2013, the Group set up Suzhou Kaituo Development Co., Ltd. with the original registered capital of USD75,000,000. According to the cooperative development agreement, a third party investor injected the capital with amounts of USD129,800,000 thereafter. After the capital injection, the Group’s share holding in Suzhou Kaituo Development Co., Ltd. dropped to 36.62% while the Group is entitled to 65% of the operating results.

The operation environment and structure of the project company require that all the major financial and operating policies are determined before third party investor is entered into. The project company may not deviate from its approved purpose and design in any material respect. At the same time, according to various legal documents, including the articles of association of the project company, investment agreements and other agreements with the third party investor, the Group retains the power to operate and manage the project company in the ordinary course of business and the dayto-day management of the project company.

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F-147

新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-278 –

合併財務報表附註

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

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41 子公司詳情（續）

(d) 本公司持有57.18%權益的子公司蘇州新城創佳置業有限公司持有本公司70%權益。因此，本集團擁有的實際比率為40.03%，惟本公司對公司擁有控制權。

(e) 重大非控股權益

於2013年12月31日的非控股權益總額為人民幣3,876,311,000元，其中人民幣 3,030,583,000元屬江蘇新城地產股份有限公司（「江蘇新城」）所有，而人民幣 795,241,000元則歸屬於蘇州凱拓房地產發展有限公司（「蘇州凱拓」）。其他子公司的非控股權益並不重大。

重大限制

現金及短期存款人民幣7,604,735,070元乃在中國持有，並受當地匯兌控制規例所規限。該等當地匯兌控制規例訂明對國家輸出資金（並非透過正常股息）的限制。

持有屬重大的非控股權益的子公司財務資料概要

以下載列持有對本集團屬重大的非控股權益的各子公司財務資料概要。有關與非控制權益進行的交易，請參閱附註40。

41 PARTICULARS OF SUBSIDIARIES (Cont’d)

(d) Suzhou Future Land Chuangjia Property Co., Ltd., the Company’s 57.18% held subsidiary, holds 70% interests in the Company. Hence, the effective rate owned by the Group is 40.03%, but the Company has control over the entity.
(e) Material non-controlling interests

The total non-controlling interest as at 31 December 2013 is RMB3,876,311,000, among which RMB3,030,583,000 is for Jiangsu Future Land Co., Ltd (“Jiangsu Future Land”) and RMB 795,241,000 is attributed to Suzhou Kaituo Development Co., Ltd. (“Suzhou Kaituo”). The noncontrolling interests in respect of other subsidiaries are not material.

Significant restrictions

C a s h a n d s h o r t - t e r m d e p o s i t s o f RMB7,604,735,070 are held in China and are subject to local exchange control regulations. These local exchange control regulations provide for restrictions on exporting capital from the country, other than through normal dividends.

Summarised financial information on subsidiaries with material noncontrolling interests

Set out below are the summarised financial information for each subsidiary that has non-controlling interests that are material to the Group. See Note 40 for transactions with non-controlling interests.

F-148 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-279 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES

(Cont’d)

(e) 重大非控股權益（續） 財務狀況表概要
(e) Material non-controlling interests (Cont’d)

Summarised statement of financial position

		position	position
		江蘇新城		蘇州凱拓
		Jiangsu Future Land		Suzhou Kaituo
		2013	2012	2013		2012
		2013年	2012年	2013年		2012年
		RMB’000	RMB’000	RMB’000	RMB’000
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
流動	Current
資產	Assets	32,530,404	28,081,425	1,828,555		–
負債	Liabilities	(20,895,838)	(20,635,568)	(780,774)		–
總流動資產淨值	Total current net assets	11,634,566	7,445,857	1,047,781		–
非流動	Non-current
資產	Assets	1,355,673	1,199,222	161,198		–
負債	Liabilities	(6,109,297)	(3,268,644)	(100,000)		–
總非流動資產淨值	Total non-current net assets	(4,753,624)	(2,069,422)	61,198		–
資產淨值	Net assets	6,880,942	5,376,435	1,108,979		–

全面收益表概要

Summarised statement of comprehensive income

		income	income
		江蘇新城		蘇州凱拓
		Jiangsu Future Land		Suzhou Kaituo
		2013	2012	2013		2012
		2013年	2012年	2013年		2012年
		RMB’000	RMB’000	RMB’000	RMB’000
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
收益	Revenue	16,583,969	14,300,447	–		–
除投資物業公允價值收益和	Profit before fair value gains
所得稅開支前的利潤	on investment properties and
	income tax expense	2,973,596	2,336,309	17,919		–
所得稅開支	Income tax expense	(1,336,666)	(981,372)	(4,321)		–
除稅後利潤	Post-tax profit	1,636,930	1,354,937	13,598		–
全面收益總額	Total comprehensive income	1,636,930	1,354,937	13,598		–
分配至非控股權益的	Total comprehensive income allocated
全面收益總額	to non-controlling interests	747,255	641,408	(3,513)		–
向非控股股東支付的股息	Dividends paid to
	non-controlling interests	65,546	32,774	–		–

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新城發展控股有限公司 Future Land Development Holdings Limited F-149 二零一三年年報 2013 Annual Report

– F-280 –

合併財務報表附註 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

截至2013年12月31日止年度 For the year ended 31 December 2013

41 子公司詳情（續）

41 PARTICULARS OF SUBSIDIARIES

(Cont’d)

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(e) 重大非控股權益（續） 現金流量表概要
(e) Material non-controlling interests (Cont’d)

Summarised cash flows

		江蘇新城	江蘇新城	蘇州凱拓	蘇州凱拓
		Jiangsu Future Land		Suzhou Kaituo
		2013	2012	2013		2012
		2013年	2012年	2013年		2012年
		RMB’000	RMB’000	RMB’000	RMB’000
		人民幣千元	人民幣千元	人民幣千元	人民幣千元
經營活動所得現金流量	Cash flows from operating activities
經營活動所得╱（所用）現金Cash generated from/(used in)
	operations	637,354	2,869,557	(1,025,935)		–
已付利息	Interest paid	(698,033)	(692,471)	–		–
已付所得稅	Income tax paid	(851,190)	(871,417)	–		–
經營活動（所用）╱所得	Net cash (used in)/generated
現金淨額	from operating activities	(911,869)	1,305,669	(1,025,935)		–
投資活動所得╱（所用）	Net cash generated from/
現金淨額	(used in) investing activities	102,844	(34,668)	(128,395)		–
融資活動所得╱（所用）	Net cash generated from/
現金淨額	(used in) financing activities	1,929,479	(1,713,473)	1,307,577		–
現金和現金等價物增加╱	Net increase/(decrease) in cash
（減少）淨額	and cash equivalents	1,120,454	(442,472)	153,247		–
年初的現金和現金等價物	Cash and cash equivalents
	at beginning of the year	3,150,165	3,592,637	–		–
年末的現金和現金等價物	Cash and cash equivalents
	at end of the year	4,270,619	3,150,165	153,247		–

The information above is the amount before intragroup transactions elimination.

上述資料為對銷集團內公司間交易前的金額。

F-150 新城發展控股有限公司 Future Land Development Holdings Limited 二零一三年年報 2013 Annual Report

– F-281 –

OUR REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS

Registered Office Principal Place of Business in Hong Kong Floor 4, Willow House Unit D, 12/F, Seabright Plaza Cricket Square, P.O. Box 2804 9-23 Shell Street Grand Cayman KY1-1112 North Point Cayman Islands Hong Kong

TRUSTEE AND PAYING REGISTRAR AND TRANSFER COLLATERAL AGENT AGENT AGENT The Bank of New York Mellon, The Bank of New York Mellon The Bank of New York London Branch (Luxembourg) S.A. 101 Barclay Street 40th Floor, One Canada Square Vertigo Building – Polaris New York, NY 10286 London E14 5AL 2-4 rue Eugène Ruppert United States of America United Kingdom L-2453 Luxembourg

COLLATERAL AGENT

The Bank of New York Mellon

LEGAL ADVISERS TO THE COMPANY

As to Hong Kong law As to United States law Shearman & Sterling Shearman & Sterling 12/F, Gloucester Tower, The Landmark 12/F, Gloucester Tower, The Landmark 15 Queen’s Road, Central 15 Queen’s Road, Central Hong Kong Hong Kong As to PRC law As to Cayman Islands law Shu Jin Law Firm Maples & Calder 24/F Aerospace Skyscraper 53/F, The Center 4019 Shennan Road 99 Queen’s Road Central Futian District Hong Kong Shenzhen, China

LEGAL ADVISERS TO THE INITIAL PURCHASERS

As to United States law As to PRC law Paul Hastings Commerce & Finance Law Office 22/F, Bank of China Tower 6F New China Insurance Tower 1 Garden Road A12 Jianguomenwai Avenue Central Chaoyang District Hong Kong Beijing, China

INDEPENDENT AUDITOR

PricewaterhouseCoopers

22nd Floor, Prince’s Building Central Hong Kong

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AI assistant

Seazen Group Limited — Capital/Financing Update 2014

49637_rns_2014-07-22_94857ecb-2414-4376-a5fc-ebc9a96f5136.pdf

Future Land Development Holdings Limited 新城發展控股有限公司

OVERSEAS REGULATORY ANNOUNCEMENT

Hong Kong, 22 July 2014

STRICTLY CONFIDENTIAL – DO NOT FORWARD

NOT FOR DISTRIBUTION IN THE UNITED STATES

Future Land Development Holdings Limited 新城發展控股有限公司

US$350,000,000 10.25% Senior Notes due 2019

Issue Price: 99.046%

Investing in the Notes involves risks. See the section headed “Risk Factors” beginning on page 20.

TABLE OF CONTENTS

NOTICE TO INVESTORS

FORWARD-LOOKING STATEMENTS

ENFORCEMENT OF CIVIL LIABILITIES

CERTAIN DEFINITIONS, CONVENTIONS AND CURRENCY PRESENTATION

SUMMARY

Overview

Our Property Development Operations

Our Diversified Product Offerings

Our Strategically Located Property Project Portfolio

Our Competitive Strengths

One of the leading property developers in the Yangtze River Delta

Our rapid asset turnover model and standardized development process enable us to maximize our investment returns and improve our operating cash flows

Diversified product portfolio with a strategic focus on middle class customers in the PRC

Strategically located land reserves, which we believe provide strong support for continued growth

Highly skilled and experienced management team with a strong commitment to high corporate governance standards

Our Business Strategies

Continue to strengthen our leadership position in the Yangtze River Delta region

Focus on increasing quality land reserves at competitive prices

Increase customer satisfaction by improving property management services and enhancing our brand recognition

Diversify our project portfolio by further expanding our commercial property development operations

Attract, retain and motivate talented personnel through systematic training programs and competitive remuneration packages

Recent Developments

Land Acquisitions and Land Premium Payments after December 31, 2013

Trust Financing Arrangements and Bank Borrowings after December 31, 2013

Our Performance in the Six Months Ended June 30, 2014

Jiangsu Future Land Performance in the Three Months Ended March 31, 2014

Corporate Information

THE OFFERING

SUMMARY HISTORICAL FINANCIAL AND OTHER DATA

Summary Consolidated Statements of Income and Other Financial Data

Summary Consolidated Statements of Financial Position Data

RISK FACTORS

Risks Relating to Our Business

Our operations are subject to extensive government policies and regulations and, in particular, we are susceptible to changes in policies affecting the PRC property industry and the regions in which we operate.

Our business and prospects are heavily dependent on the performance of the PRC property markets, particularly in various major cities in Jiangsu Province and Shanghai.

A default under any of our lending or financing agreements could result in enforcement against the security we have granted, which could materially adversely affect our ownership in the B-Share Group and hence our ability to continue our operations.

We are subject to risks associated with certain covenants or restrictions under our bank borrowings which may adversely affect our business, financial condition and results of operations.

We had negative net operating cash flow for the years ended December 31, 2011 and 2013. If we are unable to meet our payment obligations, our business, financial condition and results of operations may be materially adversely affected.

We may not have adequate financing to fund our future land acquisitions and property developments, and such capital resources may not be available on commercially reasonable terms, or at all.

Our financing costs are subject to changes in interest rates.

We may not be able to acquire land reserves in desirable locations that are suitable for development at commercially acceptable prices in the future.

We may not successfully manage our growth and expansion.

Our business may be adversely affected if we fail to obtain, or experience material delays in obtaining, necessary government approvals in carrying out our property development and management operations.

Our results of operations may vary significantly from period to period as we derive our revenue principally from the sale of properties.

We rely on third-party contractors to develop our projects.

We may not be able to complete our development projects on time, or at all.

We may forfeit land to the PRC government if we fail to develop properties in accordance with the terms and timeframe set out in the land grant contracts.

The illiquidity of property investments and the lack of alternative use for investment properties could limit our ability to respond to adverse changes in the performance of our properties.

The relevant PRC tax authorities may challenge the basis on which we calculate our LAT obligations.

The property development business is subject to claims under statutory quality warranties.

Our property development schedule may be delayed and our development costs may increase as a result of delayed governmental re-zoning, demolition and resettlement processes.

Fluctuations in the price of construction materials and contractors’ labor costs could adversely affect our business and financial performance.

We may be adversely affected if we fail to redeem the equity interests in any of our project companies we have pledged to trust financing companies to finance our property development projects.

Property owners may not retain us as the provider of property management services.

If we were unable to successfully retain the services of our current personnel and hire, train and retain senior executives or key personnel, our ability to develop and successfully market our products could be harmed.

Potential liability for health and environmental problems could result in substantial costs.

We may be involved in legal and other disputes from time to time arising out of our operations and may face significant liabilities as a result.

False, inaccurate or negative media reports about us or our projects, whether substantiated or not, may cause harm to our reputation, divert our management’s attention and adversely affect our business and results of operations.

The appraised value of our properties may be different from their actual realizable value and are subject to change.

Our current insurance coverage may not be adequate to cover all risks related to our operations.

We may be subject to fines due to non-registration of our leases.

We guarantee mortgage loans of our customers and may become liable to mortgagee banks if customers default on their mortgage loans.

Certain important decisions regarding Jiangsu Future Land may require approval by its independent directors and/or the consent of its independent public shareholders and we cannot assure you that our strategies, policies and objectives will be adopted by Jiangsu Future Land.

Risks Relating to Our Industry

The PRC property market is heavily regulated and subject to frequent introduction of new regulations, including further measures by the PRC government to slow down the growth of the property sector, which may adversely affect property developers.

The PRC property market is volatile.

We face intense competition.

Seazen Group Limited Capital/Financing Update 2014