Seazen Group Limited — Proxy Solicitation & Information Statement 2016

Aug 24, 2016

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Future Land Development Holdings Limited , you should at once hand this circular to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

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

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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)

MAJOR TRANSACTIONS IN RELATION TO

(1) THE DISPOSAL OF A SUBSIDIARY FOR THE ASSET SECURITIZATION SCHEME AND

(2) THE PREFERENTIAL RIGHTS AGREEMENT

August 24, 2016

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
Appendix I – Financial Information of the Group. . . . . . . . . . . . . . . . . . .	15
Appendix II – General Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	22

– i –

DEFINITIONS

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

• “Acquisition Agreement”

• the acquisition agreement dated June 22, 2016 entered into between Orient Asset and the Seller in respect of the Disposal;

• “Asset Securitization Scheme”

• the asset securitization scheme to be incorporated and managed by Orient Asset as the administrator to securitize the Property by issuing Securities in the amount of RMB1.05 billion to Securities Holders;

• “associate(s)” has the meaning ascribed thereto in the Listing Rules;

• “Board” the board of Directors;

• “Company”

• Future Land Development Holdings Limited, a company incorporated in the Cayman Islands with limited liability whose shares are listed on the Stock Exchange;

• “Completion” completion of the Acquisition Agreement;

• “Completion Adjustment”

• the adjustment to distribute the pre-paid rental revenue of the Property for the rental period before the Reference Date of Completion Audit (such date excluded) and the rental period after the Reference Date of Completion Audit (such date included) to the Seller and Orient Asset respectively based on the Completion Audit;

• “Completion Audit”

• the audit on the Target Company to be conducted by an accounting firm jointly engaged by the Seller and Orient Asset for the purpose of the Completion Adjustment;

• “connected person(s)”

• has the meaning ascribed thereto in the Listing Rules;

• “Consideration”

• the consideration for the Disposal under the Acquisition Agreement, being RMB1,049.82 million, being RMB349.82 million in cash and the repayment of the Seller’s Loan in the amount of RMB700 million;

• “Director(s)”

• the director(s) of the Company;

• “Disposal”

• the disposal of the Sale Interest by the Seller to Orient Asset pursuant to the Acquisition Agreement;

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DEFINITIONS

• “Future Land Holdings” Future Land Holdings Co., Ltd.* (新城控股集團股份有限 公司), a subsidiary of the Company with its A shares listed on the SSE (stock code: 601155);

• “Group” the Company and its subsidiaries;

• “HK$” Hong Kong dollar(s), the lawful currency of Hong Kong;

• “Hong Kong” the Hong Kong Special Administrative Region of the PRC;

• “Jiangsu Future Land” Jiangsu Future Land Co., Ltd.* (江蘇新城地產股份有限 公司), the former B Share company wholly-owned by Future Land Holdings and absorbed and merged by Future Land Holdings and deregistered in 2015;

• “Latest Practicable Date” August 19, 2016, being the latest practicable date for ascertaining certain information contained in this circular;

• “Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange;

• “Orient Asset” Shanghai Orient Securities Asset Management Company Limited* (上海東方證券資產管理有限公司), a company established in the PRC with limited liability;

• “PRC”

• The People’s Republic of China which, for the purpose of this circular, excludes Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan;

• “PRC GAAP”

• the generally accepted accounting principles adopted in the PRC;

• “Preferential Rights Agreement”

• the preferential rights agreement dated June 22, 2016 entered into between Orient Asset and Future Land Holdings;

• “Preferential Rights Premium”

• the preferential rights premium to be paid by Future Land Holdings to Orient Asset pursuant to the Preferential Rights Agreement;

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DEFINITIONS

“Property”

• Qingpu Injoy Plaza (青浦吾悅廣場), with 46,309.7 sq.m. of site area, 132,889.23 sq.m. of construction area and 86,348.8 sq.m. of commercial and office building area, located at Interchange of Dianshanhu Road and Caoying Road, Qingpu District, Shanghai (上海市青浦區澱山湖大 道與漕盈路交匯處);

• “Reference Date of Completion Audit”

• the reference date for the Completion Audit to be agreed by the Seller and Orient Asset;

• “Right of First Refusal”

• the right of first refusal granted to Future Land Holdings under the Preferential Rights Agreement to acquire the Securities during the ROFR Exercise Period;

• “Right of Purchase”

• the right of purchase granted by Orient Asset to Future Land Holdings to have the exclusive right to acquire all the Securities under the Asset Securitization Scheme at the ROP Exercise Price of RMB1.1 billion upon the ROP Exercise Day;

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

• “ROFR Exercise Period”

• the fourth and fifth years after the Asset Securitization Scheme is established (the last day excluded);

• “ROFR Exercise Price” RMB1.1 billion;

• “ROP Exercise Day” the third anniversary after the Asset Securitization Scheme is established;

• “ROP Exercise Price” RMB1.1 billion;

• “Sale Interest” the 100% equity interest in the Target Company;

• “Securities” securities in the amount of RMB1.05 billion to be issued by Orient Asset under the Asset Securitization Scheme to Securities Holders, who will in return enjoy the economic benefits generated from the Property;

• “Security Holders”

the holders of the Securities;

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DEFINITIONS

“Seller” Shanghai Future Land Wanjia Real Estate Co., Ltd. (上 海新城萬嘉房地產有限公司), a company incorporated in the PRC with limited liability and a wholly-owned subsidiary of Future Land Holdings; “Seller’s Loan” the no-interest-bearing loan in the amount of RMB700 million owed by the Target Company to the Seller as at the date of the Acquisition Agreement; “SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong); “Shanghai Jinjun” Shanghai Future Land Jinjun Real Estate Company Limited (上海新城金郡房地產有限公司), a company incorporated in the PRC with limited liability and a subsidiary of Future Land Holdings; “Share(s)” ordinary share(s) in the share capital of the Company with a par value of HK$0.001 each; “Shareholder(s)” the shareholder(s) of the Company; “SSE” the Shanghai Stock Exchange; “Stock Exchange” The Stock Exchange of Hong Kong Limited; “Subsidiary(ies)” has the meaning as ascribed thereto under the Companies Ordinance (Chapter 622 of the Laws of Hong Kong); “Target Company” Shanghai Diyu Commercial Operation Management Co., Ltd* (上海迪裕商業經營管理有限公司), a company incorporated in the PRC with limited liability and an investment holding company incorporated for the purpose of the Property;

“Valuer” Shenzhen DTZ Cushman & Wakefield Real Estate Valuation Company Limited* (深圳市戴德梁行土地房地 產評估有限公司), an independent valuer with grade I real estate valuation qualification issued by the Ministry of Housing and Urban – Rural Development of the PRC; and

“%”

per cent.

• For identification purpose only

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LETTER FROM THE BOARD

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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)

Executive Director: Mr. Wang Zhenhua ( Chairman ) Mr. Lv Xiaoping ( Chief Executive Officer ) Mr. Lu Zhongming Mr. Liu Yuanman Mr. Chan Wai Kin

Registered Office: Floor 4, Willow House Cricket Square P.O. Box 2804 Grand Cayman KY1-1112 Cayman Islands

Non-executive Director: Mr. Wang Xiaosong Independent Non-executive Directors: Mr. Chen Huakang Mr. Zhu Zengjin Mr. Zhong Wei

Principal place of business in Hong Kong: 36/F, Tower Two Times Square 1 Matheson Street Causeway Bay, Hong Kong

August 24, 2016

To the Shareholders

Dear Sir or Madam,

MAJOR TRANSACTIONS IN RELATION TO

(1) THE DISPOSAL OF A SUBSIDIARY FOR THE ASSET SECURITIZATION SCHEME

AND

(2) THE PREFERENTIAL RIGHTS AGREEMENT

INTRODUCTION

Reference is made to the announcement of the Company dated June 22, 2016 regarding the Acquisition Agreement, the Preferential Rights Agreement and the transactions contemplated thereunder.

The Target Company is an indirect wholly-owned subsidiary of Future Land Holdings, a subsidiary of the Company with its A shares listed on the SSE (stock code: 601155), and is currently holding the Property. Orient Asset intends to acquire the Target Company for the

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LETTER FROM THE BOARD

purpose of the Asset Securitization Scheme. Pursuant to the Asset Securitization Scheme, Orient Asset, as the administrator of the Asset Securitization Scheme, will issue Securities in the amount of RMB1.05 billion to Security Holders, who will in return enjoy the economic benefits generated from the Property. Orient Asset will also engage a subsidiary of Future Land Holdings, whose principal business is commercial property management, to manage and operate the Property after the Asset Securitization Scheme is established.

As disclosed in the announcement of the Company dated June 22, 2016, the Seller, being a wholly-owned subsidiary of Future Land Holdings, entered into the Acquisition Agreement with Orient Asset, pursuant to which the Seller agreed to sell, and Orient Asset agreed to purchase, the Sale Interest in the Target Company for the Consideration of RMB1,049.82 million (including the repayment of the Seller’s Loan). Orient Asset and Future Land Holdings entered into the Preferential Rights Agreement, pursuant to which Future Land Holdings agreed to pay the Preferential Rights Premium and Orient Asset agreed to grant the Right of Purchase and the Right of First Refusal to Future Land Holding.

The purpose of this circular is, among other things, to provide you with more information in relation to (i) the Acquisition Agreement, the Preferential Rights Agreement and the transactions contemplated thereunder; (ii) the financial information of the Group and the Target Company; and (iii) other information required under the Listing Rules.

THE ACQUISITION AGREEMENT

Date: June 22, 2016 Parties: Seller: Shanghai Future Land Wanjia Real Estate Co., Ltd.* (上海新城萬 嘉房地產有限公司)

Purchaser: Shanghai Orient Asset Asset Management Company Limited* (上海東方證券資產管理有限公司)

Target Company: Shanghai Diyu Commercial Operation Management Co., Ltd* (上海迪裕商業經營管理有限公司)

Consideration

The Consideration for the Disposal is RMB1,049.82 million, subject to the Completion Adjustment, being RMB349.82 million in cash and the repayment of the Seller’s Loan in the amount of RMB700 million. The Consideration was determined and agreed between the parties after arm’s length negotiations based on normal commercial terms, with reference to the unaudited net assets of the Target Company in the amount of RMB15,397,753 as at May 31, 2016 and the valuation of the Property of RMB1,191 million as at March 31, 2016 by the independent Valuer. The difference between the unaudited net assets of the Target Group and the valuation of the Property resulted from (i) the Seller’s Loan in the amount of RMB700 million and (ii) the difference between the book value and the valuation of the Property.

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LETTER FROM THE BOARD

Completion Adjustment

The Seller and Orient Asset will agree on the Reference Date of Completion Audit and jointly engage an accounting firm to conduct the Completion Audit on the Target Company and issue the report for the Completion Audit on the Target Company as at the Reference Date of Completion Audit. Based on the Completion Audit, the pre-paid rental revenue of the Property for the rental period before and after the Reference Date of Completion Audit should be allocated to the Seller and Orient Asset respectively.

Seller’s Loan

The Target Company has the outstanding Seller’s Loan in the amount of RMB700 million as at the date of the Acquisition Agreement, which bears no interest. It is agreed that Orient Asset will provide a loan to the Target Company from the proceeds raised under the Asset Securitization Scheme, which will be used to repay the Seller’s Loan.

Payment Terms

The Consideration shall be paid by the Seller in the following sequence: the first tranche of cash in the amount of RMB199.82 million shall be paid within 60 working days after the date of the Acquisition Agreement or the Reference Date of Completion Audit, whichever is later; the Seller’s Loan in the amount of RMB700 million shall be repaid within 20 working day after the payment of the first tranche of cash; and the second tranche of cash in the amount of RMB150 million shall be paid within 3 working days after the Seller provides the report for the Completion Audit to Orient Asset and the payment under to the Completion Adjustment is made.

Completion

Pursuant to the Acquisition Agreement, Completion shall take place upon completion of the industrial and commercial registration of the transfer in respect of the Sale Interest in accordance with the terms of the Acquisition Agreement. Completion and the industrial and commercial registration of the transfer in respect of the Sale Interest took place on June 22, 2016.

Future Land Holdings’ Guarantee

Future Land Holdings has given a guarantee in favour of Orient Asset for the Seller’s due performance and observance of its obligations under the Acquisition Agreement. Future Land Holdings shall be jointly liable for the Seller’s breach of its obligations, representations or warranties under the Acquisition Agreement.

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LETTER FROM THE BOARD

THE PREFERENTIAL RIGHTS AGREEMENT

Date : June 22, 2016 Parties: Orient Asset; and Future Land Holdings

Right of Purchase

Pursuant to the Right of Purchase, Future Land Holdings has the exclusive right to acquire, and Orient Asset should procure all Security Holders to sell, all the Securities under the Asset Securitization Scheme, at the ROP Exercise Price of RMB1.1 billion, upon the ROP Exercise Day, which is the third anniversary after the Asset Securitization Scheme is established. If Future Land Holdings exercises the Right of Purchase, Future Land Holdings should give Orient Asset a written notice at least 20 working days before the ROP Exercise Day.

Right of First Refusal

If Future Land Holdings does not exercise the Right of Purchase, Future Land Holdings will have the Right of First Refusal during the ROFR Exercise Period, which is the fourth and fifth years after the Asset Securitization Scheme is established (the last day excluded). During the ROFR Exercise Period, Future Land Holdings has the right to acquire, and Orient Asset should procure all Security Holders to sell, all the Securities under the Asset Securitization Scheme, at the ROFR Exercise Price. In particular, if Orient Asset reaches a preliminary agreement with a third party on the acquisition of the Securities, Orient Asset should notify Future Land Holdings in writing and Future Land Holdings should decide whether to exercise the Right of First Refusal within the period specified under the said notice from Orient Asset.

Preferential Rights Premium

Future Land Holdings agrees to pay to Orient Asset the Preferential Rights Premium in the total amount of RMB200 million in the following sequence: 1st installment in the amount of RMB60 million upon the payment of the Consideration (being the payment of RMB349.82 million in cash and the repayment of the Seller’s Loan in the amount of RMB700 million) by Orient Asset or on the next working day; 2nd installment in the amount of RMB50 million on the first working day after the first anniversary after the Asset Securitization Scheme is established; 3rd installment in the amount of RMB40 million on the first working day after the second anniversary after the Asset Securitization Scheme is established; 4th installment in the amount of RMB30 million on the first working day after the third anniversary after the Asset Securitization Scheme is established; and 5th installment in the amount of RMB20 million on the first working day after the fourth anniversary after the Asset Securitization Scheme is established. Waiver of the Right of Purchase or the Right of First Refusal will not discharge Future Land Holdings from the obligation to pay the Preferential Rights Premium.

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LETTER FROM THE BOARD

If Future Land Holdings exercises the Right of Purchase upon the ROP Exercise Day, Future Land Holdings does not need to pay the 4th and 5th installments of the Preferential Rights Premium in the total amount of RMB50 million. If Future Land Holdings exercises the Right of First Refusal during the fourth year after the Asset Securitization Scheme is established, Future Land Holdings does not need to pay the 5th installment of the Preferential Rights premium in the amount of RMB20 million.

The Preferential Rights Premium, the ROP Exercise Price and the ROFR Exercise Price were determined and agreed between the parties after arm’s length negotiations based on normal commercial terms, with reference to the Consideration under the Acquisition Agreement. The Preferential Rights Premium will be satisfied by the Company’s internal resources.

Termination of Asset Securitization Scheme

After acquiring all the Securities under the Asset Securitization Scheme, Future Land Holdings has the right to request Orient Asset to terminate the Asset Securitization Scheme and transfer the Property back to Future Land Holdings.

FINANCIAL EFFECT OF THE PREFERENTIAL RIGHTS AGREEMENT

The unaudited gain before tax from the Disposal is estimated to be approximately RMB373,291, representing the difference between the Consideration of RMB1,049.82 million and the carrying value of the Target Company of RMB1,049,446,709 as of May 31, 2016. The net proceeds from the Disposal after expenses are expected to be approximately RMB1,048 million (including the repayment of the Seller’s Loan), which will be used by the Group for development of the Group’s real estate projects and general working capital purpose. Upon Completion, the Target Company will cease to be a subsidiary of the Company.

The Company does not expect any material financial impact on the Company’s assets or liabilities or any material gain or loss recorded directly arising from the entering into of the Preferential Rights Agreement.

If Future Land Holdings exercises the Right of Purchase upon the ROP Exercise Day, Future Land Holdings is expected to pay RMB1.25 billion in total to Orient Asset, being the sum of the ROP Exercise Price of RMB1.1 billion and the Preferential Rights Premium of RMB150 million. If Future Land Holdings exercises the Right of First Refusal during the fourth year after the Asset securitization Scheme is established, Future Land Holdings is expected to pay RMB1.28 billion in total to Orient Asset, being the sum of the ROFR Exercise Price of RMB1.1 billion and the Preferential Rights Premium of RMB180 million. If Future Land Holdings exercises the Right of First Refusal during the fifth year after the Asset Securitization Scheme is established, Future Land Holdings is expected to pay RMB1.3 billion in total to Orient Asset, being the sum of the ROFR Exercise Price of RMB1.1 billion and the Preferential Rights Premium of RMB200 million. The Company is not expected to record any gain or loss arising from the exercise of Right of Purchase or Right of First Refusal.

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LETTER FROM THE BOARD

The exact financial effects of these transactions are subject to the review of the Company’s auditors at the relevant time.

INFORMATION ON THE GROUP

The Group is principally engaged in the business of property development, property investment and commercial property management in the PRC.

Future Land Holdings is a subsidiary of the Company with its A shares listed on the SSE. The Seller is a wholly-owned subsidiary of Future Land Holdings.

INFORMATION ON ORIENT ASSET

Orient Asset is a company incorporated in the PRC with limited liability whose principal business is asset management in the PRC.

To the best of the knowledge, information and belief of the Directors and having made all reasonable enquires, Orient Asset (including its ultimate beneficial owners) is third party independent of the Company and its connected persons.

INFORMATION ON THE TARGET COMPANY AND THE PROPERTY

The Target Company is incorporated in the PRC with limited liability and is an investment holding company for the purpose of holding the Property. The Property is a shopping and office complex, the particulars of which are as follows:

Property name: Qingpu Injoy Plaza (青浦吾悅廣場) Property title Hu Fang Di Qing Zi (2016) No. 005184 (滬房地青字 certificate number: (2016) 第005184號) Site location: Interchange of Dianshanhu Road and Caoying Road, Qingpu District, Shanghai (上海市青浦區澱山湖大道與 漕盈路交匯處) Total property area: 46,309.7 sq.m. of site area, 132,889.23 sq.m. of construction area and 86,348.8 sq.m. of commercial and office building area Land use: other commercial and service purposes Date of commencement of December 20, 2014 business:*

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LETTER FROM THE BOARD

As at March 31, 2016, an aggregate of 61,666.82 square meters of the commercial units of the Property located on floor L1-L5 and UG1 has been leased to 142 tenants, for which 78 lease agreements have a term of 3 years or below, 51 lease agreements have a term of 4 to 7 years and 13 lease agreements have a term of 8 years or above. The occupancy rate of the commercial units of the Property was 98.68%.

Set out below is a summary of the unaudited financial information of the Target Company for the two years ended 31 December 2015:

			For the year ended	For the year ended
			31 December 2015	31 December 2014
			(approximately	(approximately
			RMB)	RMB)
Net	profit/(loss)	before tax	(11,460)	NA
Net	profit/(loss)	after tax	(8,590)	NA

As at 31 December 2015, the unaudited net liabilities of the Target Company was approximately RMB10,000.

Valuation of the Property

The methodology adopted for the Valuer’s valuation of Property is comparable method and discounted cash flow method. For the comparable method, the valuation of the Property is based on the prices of three sample transactions selected based on location, date of transaction, use of the subject property, transaction type and subject property condition with adjustments to reflect the differences between the Property and the subject properties of the samples transactions. For the discounted cash flow method, the valuation of the Property is based on the future cash flow of the Property (including rent income and advertisement income) adjusted for time value.

The key assumptions for the valuation of the Property are set out as follows:

• (1) The Valuer assumed that the land premium and the public utility fees in relation to the Property have been paid off in full and the Seller has the title to Property free from encumbrances;

• (2) The Valuer assumed that during the term of land use right of the Property, the owner of the Property shall enjoy all legal rights and benefits free from interference, including the rights of use, transfer, benefit and disposal;

• (3) The Valuer assumed that there are no geographical factors which may affect the use and planning of the land on which the Property was built;

• (4) According to Shanghai Property Ownership Certificate (Hu Fang Di Qing Zi (2016) No. 005184) provided by Future Land Holdings, there was no charge over the Property as at March 31, 2016. The Valuer assumed that there are no encumbrances, restrictions or material expenses in relation to the Property which may affect the value of the Property; and

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LETTER FROM THE BOARD

• (5) Based on the lease agreements provided by Future Land Holdings, most of the commercial units of the Property located on floor L1 – L5 and UG1 have been leased out, which has been taken into consideration for the valuation of the Property.

The key bases for the valuation of the Property are set out as follows:

• (1) relevant national and local laws and regulation of the PRC;

• (2) technical standards:

• (a) Real Estate Valuation Regulations* (《房地產估值規範》) GB/T50291-1999;

• (b) Real Estate Valuation Basic Terminology and Standards* (《房地產估值基本 術語標準》) GB/T 50899-2013;

• (c) Guiding Opinions on the Valuation of Real Estate Investment Trust Property (Tentative)* (《房地產投資信託基金物業估值指導意見 (試行) 》); and

• (d) Guidance on the Valuation of Real Estate Investment Trust Property (Tentative)* (《房地產投資信託基金物業估值指引 (試行) 》);

• (3) relevant documents regarding the Property provided by Future Land Holdings, including Shanghai Property Ownership Certificate (Hu Fang Di Qing Zi (2016) No. 005184) and the lease agreements of the Property; and

• (4) site inspection of the Property by the Valuer.

REASONS FOR THE DISPOSAL AND THE PREFERENTIAL RIGHTS AGREEMENT

The Disposal and the Preferential Rights Agreement represent an opportunity for the Company to optimize its fixed assets portfolio. After the Completion, the Property will continue to be operated under the Group’s brand name of “Injoy”, which will help maintain the Company’s presence and position in the market. The positive cash flow generated from the Disposal will strengthen the Company’s financial position and finance the Company’s future real estate development projects. As the same time, the Preferential Rights Agreement gives the Company the flexibility to reacquire the Property in the future, depending on the property market situation and the Company’s development strategy.

The Company will achieve positive cash inflow through transfer of the Property to Orient Asset for the Asset Securitization Scheme. For the Group’s commercial properties, the payback period will be shortened and the asset turnover will be improved. This will benefit the asset structure, enhance the capital utilization and strengthen commercial operation capacity of the Company, which is a new asset light business model for the Company’s commercial properties.

In view of the above, the Directors consider that the terms of the Acquisition Agreement and the Preferential Rights Agreement are fair and reasonable, on normal commercial terms and in the interest of the Company and the Shareholders as a whole.

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LETTER FROM THE BOARD

IMPLICATIONS UNDER THE LISTING RULES

The applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect of the Disposal and the Acquisition Agreement exceed 5% but are less than 25% and the applicable percentage ratios (as defined in Rule 14.07 of the Listing Rules) in respect of the Preferential Rights Agreement exceed 25% but are less than 100%.

Pursuant to Rule 14.24 of the Listing Rules, since the underlying subject of the Preferential Rights Agreement is also the Property, the Disposal and the Preferential Rights Agreement will be regarded as one transaction involving both an acquisition and a disposal. The Disposal and the Preferential Rights Agreement will be classified by reference to the highest of the percentage ratios of the Disposal and the Preferential Rights Agreement, being a major transaction, and subject to the reporting, announcement and shareholders’ approval requirements under Chapter 14 of the Listing Rules applicable to major transaction. Only the Preferential Rights Agreement and the acquisition of the Right of Purchase and the Right of First Refusal will be subject to the circular content requirements under Chapter 14 of the Listing Rules applicable to major transaction.

To the best of the Directors’ knowledge, information and belief, having made all reasonable enquiries, none of the Shareholders nor any of their respective associates has any material interest in the Disposal and the Preferential Rights Agreement, as at June 22, 2016, the date of the announcement of the company to disclose the Disposal and the Preferential Rights Agreement, and therefore none of them is required to abstain from voting if a general meeting is to be convened for the approval of the Disposal and the Preferential Rights Agreement. The Company has obtained a written approval for the Disposal and the Preferential Rights Agreement in lieu of holding a general meeting in accordance with Rule 14.44 of the Listing Rules from Wealth Zone Hong Kong Investments Limited, the beneficial owner of 4,105,450,000 Shares with voting rights of approximately 72.56% on June 22, 2016. Wealth Zone Hong Kong Investments Limited has the right to vote at the extraordinary general meeting (if convened) to approve such transactions. As such, the Company is not required to convene a general meeting for the purpose of approving the Disposal and the Preferential Rights Agreement as permitted under Rule 14.44 of the Listing Rules.

The accountant’s report of the Target Company and the valuation report of the Property are not required under the Chapter 14 of the Listing Rules in relation to the Preferential Rights Agreement and the acquisition of the Right of Purchase and the Right of First Refusal and therefore are not provided in this circular. The Company will provide the accountant’s report of the Target Company and the valuation report of the Property upon the exercise of the Right of Purchase or Right of First Refusal, if required under the Listing Rules.

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LETTER FROM THE BOARD

RECOMMENDATION

Although no general meeting will be convened for approving the Disposal and the Preferential Rights Agreement, the Directors (including the independent non-executive Directors) believe that the Disposal and the Preferential Rights Agreement are fair and reasonable and are in the best interests of the Company and the Shareholders as a whole. Accordingly, if the general meeting were convened for approving the Disposal and the Preferential Rights Agreement, the Directors would have recommended the Shareholders to vote in favour of the Disposal and the Preferential Rights Agreement.

ADDITIONAL INFORMATION

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

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

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

1. FINANCIAL INFORMATION OF THE GROUP

Financial information of the Group for each of the three years ended 31 December 2015 are disclosed in the following documents which have been published on the websites of the Stock Exchange (http://www.hkexnews.hk) and the Company (http://www.futureholdings.com.cn):

• annual report of the Company for the year ended December 31, 2015 published on March 29, 2016

http://www.hkexnews.hk/listedco/listconews/SEHK/2016/0329/LTN20160329351.pdf

• annual report of the Company for the year ended December 31, 2014 published on March 26, 2015

http://www.hkexnews.hk/listedco/listconews/SEHK/2015/0326/LTN20150326339.pdf

• annual report of the Company for the year ended December 31, 2013 published on April 9, 2014

http://www.hkexnews.hk/listedco/listconews/SEHK/2014/0409/LTN20140409249.pdf

• interim results announcement of the Company for the six months ended June 30, 2016 published on July 29, 2016

http://www.hkexnews.hk/listedco/listconews/SEHK/2016/0731/LTN20160731007.pdf

2. INDEBTEDNESS

As at June 30, 2016, the Group had borrowings of approximately RMB22,511.4 million, comprising (i) bank loans of approximately RMB8,661.8 million, (ii) senior notes of approximately RMB3,913.7 million and (iii) corporate bonds of approximately RMB9,935.9 million.

Bank loans

These bank loans of the Group are secured by leasehold land to be developed, properties under development, properties held for sale, investment properties, land use rights, property, plant and equipment, shares of subsidiaries and bank deposits of the Group and/or guaranteed by subsidiaries of the Company for each other.

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 interest 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.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

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:

Year

Redemption Price

31 January 2016 to 30 January 2017 105.1250% 31 January 2017 and thereafter 102.5625%

• 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.

On 3 December 2015, the Company announced that all the outstanding 2018 Notes will be redeemed in full on 31 January 2016 (the “ Redemption Date ”) at a redemption price equal to 105.1250% of the principal amount thereof, plus accrued and unpaid interest, if any, to the Redemption Date. Accordingly the entire outstanding amount as at 31 December 2015 was treated as current liability and the net loss arising was fully accounted for as part of finance costs in December 2015. The Company subsequently completed the redemption on 31 January 2016.

(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 interest 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.

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The Company redeemed the 2016 Notes in full on 25 April 2016.

(iii) 2019 Notes

In July 2014, the Company issued five-year senior notes with principal amount of USD350,000,000 (“ 2019 Notes ”), which were listed on the Singapore Exchange Securities Trading Limited. The 2019 Notes are denominated in USD, and bear interest rate at 10.25% per annum, payable semi-annually in arrears on or on the business day nearest to 21 January and 21 July of each year, beginning 21 January 2015.

According to the terms of 2019 Notes, the Notes may be redeemed in the following circumstances:

• At any time and from time to time on or after 21 July 2017, the Company may redeem the 2019 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 21 July of any year set forth below:

Year

Redemption Price

21 July 2017 to 20 July 2018 105.1250% 21 July 2018 and thereafter 102.5625%

• At any time prior to 21 July 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 2019 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 21 July 2017, 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.

(iv) 2017 Notes

In November 2015, the Company issued two-year senior notes with principal amount of USD250,000,000 (“ 2017 Notes ”), which were listed on the Singapore Exchange Securities Trading Limited. The 2017 Notes are denominated in USD, and bear interest rate at 6.25% per annum, payable semi-annually in arrears on or on the business day nearest to 12 May and 12 November of each year, beginning 12 November 2015.

According to the terms of 2017 Notes, the Company may at its option redeem the 2017 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.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

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 2015 and 30 June 2016. The early redemption of the 2018 Notes only occurred because an opportunity arose to issue new Notes at a lower cost to replace old Notes.

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.

Corporate bonds

(i) 2019 Bonds

In July 2014, Jiangsu Future Land issued five-year corporate bonds with principal amount of RMB2,000,000,000 (“ 2019 Bonds ”), which were listed on the Shanghai Stock Exchange. The 2019 Bonds are denominated in RMB, and bear interest rate at 8.9% per annum for the first three years, payable annually in arrears on or on the business day nearest to 23 July of each year, beginning 23 July 2015.

According to the terms of 2019 Bonds, Jiangsu Future Land may at its option redeem the 2019 Bonds in whole at end of the third year, at a redemption price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the redemption date. If Jiangsu Future Land waives the optional redemption at end of the third year, Jiangsu Future Land may at its option raise the interest rate by 0 to 100 basis points which will be fixed in the remaining period, and the bondholders may at their option sell the bonds back to Jiangsu Future Land, in whole or in part, at a price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the sold-back date.

The obligations relating to the 2019 Bonds had been transferred from Jiangsu Future Land to Future Land Holdings.

(ii) 2020 Bonds

In November 2015, Future Land Holdings issued five-year corporate bonds with principal amount of RMB3,000,000,000 (“ 2020 Bonds ”), which were listed on the Shanghai Stock Exchange. The 2020 Bonds are denominated in RMB and bear interest rate at 4.5% per annum for the first three year, payable annually in arrears on or on the business day nearest to 3 November of each year, beginning 3 November 2016.

According to the terms of 2020 Bonds, Future Land Holdings may at its option adjust the interest rate at the end of the third year which will be fixed in the remaining period, and the bondholders may at their option sell the bonds back to Future Land Holdings, in whole or in part, at a price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the sold-back date.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

(iii) 2018 Bonds

In November 2015, Future Land Holdings issued three-year corporate bonds with principal amount of RMB2,000,000,000 (“ 2018 Bonds ”), which were listed on the Shanghai Stock Exchange. The 2018 Bonds are denominated in RMB, and bear interest rate at 6.0% per annum for the first two years, payable annually in arrears on or on the business day nearest to 10 November of each year, beginning 10 November 2016.

According to the terms of 2018 Bonds, Future Land Holdings may at its option adjust the interest rate at the end of the second year which will be fixed in the remaining period, and the bondholders may at their option sell the bonds back to Future Land Holdings, in whole or in part, at a price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the sold-back date.

(iv) 2019 Bonds I

In March 2016, Future Land Holdings issued three-year corporate bonds with principal amount of RMB1,850,000,000 (“ 2019 Bonds I ”), which were listed on the Shanghai Stock Exchange. The 2019 Bonds I are denominated in RMB, and bear interest rate at 5.44% per annum for the first two years, payable annually in arrears on or on the business day nearest to 31 March of each year, beginning 31 March 2016.

According to the terms of 2019 Bonds I, Future Land Holdings may at its option adjust the interest rate at the end of the second year which will be fixed in the remaining period, and the bondholders may at their option sell the bonds back to Future Land Holdings, in whole or in part, at a price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the sold-back date.

(v) 2019 Bonds II

In March 2016, Future Land Holdings issued three-year corporate bonds with principal amount of RMB1,150,000,000 (“ 2019 Bonds II ”), which were listed on the Shanghai Stock Exchange. The 2019 Bonds II are denominated in RMB, and bear interest rate at 4.76% per annum for the first year, payable annually in arrears on or on the business day nearest to 31 March of each year, beginning 31 March 2016.

According to the terms of 2019 Bonds II, Future Land Holdings may at its option adjust the interest rate at the end of the first and second year which will be fixed in the remaining period, and the bondholders may at their option sell the bonds back to Future Land Holdings, in whole or in part, at a price equal to 100% of the principal amount of the Bonds plus accrued and unpaid interest to the sold-back date.

Pursuant to the mortgage contracts of the purchasers of the Group’s properties, banks require the Group to guarantee its purchasers’ mortgage loans. Guarantees for mortgages on pre-sold residential properties are generally discharged at the earlier of: (i) the issue of the real estate ownership certificate by government authorities to the purchaser, or (ii) the satisfaction of mortgage loans by the purchasers of the properties. If a purchaser defaults on a mortgage loan, the Group is responsible to repay the outstanding mortgage principal together with

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

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 typically starts from the date of grant of the mortgage.

As at June 30, 2016, the Group’s contingent liabilities in respect of the guarantees given to the financial institutions for mortgage loan facilities granted to purchasers of the Group’s properties amounted to approximately RMB14,381.5 million. In light of the minimal historical default rates of such mortgage loans facilities, the Directors considered that the likelihood of default of payments by the purchasers is minimal and therefore the financial guarantee measured at fair value is immaterial. There are certain corporate guarantees provided by the Company’s subsidiaries for each other in respect of borrowings as at June 30, 2016. The Directors consider that the Company’s subsidiaries are sufficiently financially resourced to settle their obligations.

Save as disclosed in this circular, the Group had no other material contingent liabilities as at June 30, 2016. Save as aforesaid or as otherwise disclosed herein, and apart from intra-group liabilities, the Group did not have outstanding at June 30, 2016, any loan capital issued and outstanding or agreed to be issued, bank overdrafts, loans or other similar indebtedness, obligations under finance lease contracts, liabilities under acceptances (other than normal trade bills) or acceptable credits, debentures, mortgages, charges, finance lease or hire purchases commitments, guarantees or contingent liabilities.

3. WORKING CAPITAL

The Directors, after due and careful enquiry, are of the opinion that, after taking into consideration the financial resources available to the Group including internally generated funds and the available banking facilities, the Group will have sufficient working capital for its present requirements, that is for at least the next twelve months from the date of publication of this circular, in the absence of unforeseeable circumstances.

4. MATERIAL CHANGE

As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position or prospect of the Group since June 30, 2016, the date to which the latest published audited consolidated financial statements of the Group were made up.

5. FINANCIAL AND TRADING PROSPECT

During the second half of 2016, the PRC economy is expected to remain on a stable growth track with the government putting more stress on the healthy, reasonable and sustainable development in the long term. At the same time, the ongoing urbanization in China, coupled with increasing demand from first time property buyers and consumers’ demand for improved housing quality and enhanced experience in commercial projects, are expected to support the steady development of the real estate industry.

In view of the above, the Group will continue to properly execute its annual plan. The Group will further improve product mix and secure satisfactory contracted sales by keeping up with changes in customers’ demand for improved housing quality. Furthermore, the Group will also adhere to prudent land acquisition strategy, further deepen presence in those cities where the Group is operating and seek opportunities in new cities with good business prospects.

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FINANCIAL INFORMATION OF THE GROUP

APPENDIX I

In addition, the Group will seek cooperation with more outstanding enterprises and acquisition opportunities, explore new business models in domestic and overseas markets, optimize the Group’s diversification strategy and enhance the Group’s adaptability to changes so as to identify new opportunities for the Group’s mid-term and long-term development. The Group will continue to adhere to a stringent financial policy and take full advantage of diversified financing channels, so as to better protect the Group against various risks. The Group believes that these cautious yet responsive operating strategies would enable the Group to remain competitive and mitigate risks in a highly competitive environment, thereby ensuring the Group’s sustainable growth in the long term.

The Group is accelerating its overall asset turnover and will continue to realise the value of existing assets. It is the Group’s strategy to divest commercial properties in its portfolio that are mature and stabilized at the right time and price. The Disposal and the Preferential Rights Agreement represent an opportunity for the Company to optimize its fixed assets portfolio. After the Completion, the Property will continue to be operated under the Group’s brand name of “Injoy”, which will help maintain the Company’s presence and position in the market. The positive cash flow generated from the Disposal will strengthen the Company’s financial position and finance the Company’s future real estate development projects. As the same time, the Preferential Rights Agreement gives the Company the flexibility to reacquire the Property in the future, depending on the property market situation and the Company’s development strategy.

In relation to the development of the Group’s properties, the Group will continue to deepen its presence in first-tier and second-tier cities, such as Shanghai, Nanjing, Suzhou, Hangzhou and Wuhan, and will further strategically expand into Chengdu, Ningbo, Taizhou, Shaoxing, Jiaxing, Yiwu, Quzhou and Quanzhou to further broaden the coverage of its business operations and provide necessary resources for its business growth in the future. The Group will continue to launch new residential and commercial property projects in the PRC.

According to the unaudited internal records of the Group, for the first seven months ended July 31, 2016, the Group achieved accumulated contracted sales of approximately RMB33,460 million and accumulated contracted sales area of approximately 3,226,000 sq.m..

Based on the above, the Directors consider that the Group will generate a stable and recurring income stream, which enables the Group to strengthen its asset base and provide capital appreciation potential to the Group. The Directors are optimistic about the trading and financial prospects of the property development and property investment businesses of the Group during the second half of 2016.

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GENERAL INFORMATION

APPENDIX II

RESPONSIBILITY STATEMENT

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

DIRECTORS’ AND CHIEF EXECUTIVE’S INTERESTS AND SHORT POSITIONS IN THE SECURITIES OF THE COMPANY AND ITS ASSOCIATED CORPORATIONS

As at the Latest Practicable Date, the interests of the Directors in the Shares which were required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which he/she was deemed or taken to have under such provisions of the SFO), or which were required, pursuant to Section 352 of the SFO, to be entered in the register referred to therein, or which were required, pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the “Model Code”), to be notified to the Company and the Stock Exchange, were as follows:

			Approximate
		Number	percentage of
Name of Director	Nature of interest	of Shares held	shareholding
Wang Zhenhua	Founder of a discretionary	4,105,450,000 (L)(1)	72.56%
	trust(2)
Liu Yuanman	Beneficiary of a trust(3)	1,250,000 (L)	0.02%
	Beneficial owner(5)	3,750,000 (L)	0.07%
Lv Xiaoping	Beneficiary of a trust(3)	3,000,000 (L)	0.05%
	Beneficial owner(5)	9,000,000 (L)	0.16%
Wang Xiaosong	Interest in a controlled	16,800,000 (L)	0.30%
	corporation(4)
	Beneficial owner(5)	6,000,000 (L)	0.11%
Lu Zhongming	Beneficiary of a trust(3)	1,250,000 (L)	0.02%
	Beneficial owner(5)	3,750,000 (L)	0.07%
Chan Wai Kin	Interest of spouse(6)	300,000 (L)	0.01%

Notes:

• (1) The letter “L” denotes the long position in Shares.

• (2) Mr. Wang Zhenhua is the founder of the Hua Sheng Trust, through which Standard Chartered Trust (Singapore) Limited held long position in 4,105,450,000 Shares through its controlled corporation in its capacity as trustee.

• (3) These Directors are grantees under the pre-IPO share award scheme.

• (4) Mr. Wang Xiaosong is the beneficial owner of all the issued share capital of Dynasty Snow (PTC) Ltd., which in turn held 16,800,000 Shares. Mr. Wang Xiaosong is also interested in 2,000,000 Shares out of the 16,800,000 Shares held by Dynasty Snow (PTC) Ltd., by virtue of his interest in the Shares granted to him under the pre-IPO share award scheme.

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GENERAL INFORMATION

APPENDIX II

• (5) The Shares were vested on these Directors on December 31, 2013, December 31, 2014 and December 31, 2015 pursuant to the pre-IPO share award scheme.

• (6) Such 300,000 Shares are held by Ms. Chan Wing Yan, the spouse of Mr. Chan Wai Kin, and accordingly, Mr. Chan Wai Kin was deemed to be interested in such 300,000 Shares.

Save as disclosed above, as at the Latest Practicable Date, none of the Directors and the chief executive of the Company had or was deemed to have any interest or short position in the shares, underlying shares or debentures of the Company or its associated corporations (within the meaning of Part XV of the SFO) that was required to be recorded in the register of the Company required to be kept under Section 352 of the SFO, or as otherwise notified to the Company and the Stock Exchange pursuant to the Model Code.

As at the Latest Practicable Date, so far as was known to the Directors, none of the Directors was also directors or employees of a company which has an interest or short position in the Shares and underlying Shares, which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO.

SUBSTANTIAL SHAREHOLDERS’ INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES

As at the Latest Practicable Date, to the best knowledge of the Directors, the following persons (not being a Director or chief executive of the Company) had interests or short positions in the Shares or underlying Shares which fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO as recorded in the register required to be kept by the Company pursuant to section 336 of the SFO:

			Approximate
Name of Substantial	Capacity/Nature	Number	percentage of
Shareholders	of interest	of Shares held	shareholding
Standard Chartered Trust	Trustee	4,105,450,000(L)(1)	72.56%
(Singapore) Limited(2)
SCTS Capital Pte. Ltd.(2)	Nominee	4,105,450,000(L)	72.56%
Infinity Fortune	Interest in a controlled	4,105,450,000(L)	72.56%
Development Limited(2)	corporation
First Priority Group	Interest in a controlled	4,105,450,000(L)	72.56%
Limited(2)	corporation
Wealth Zone Hong Kong	Beneficial owner	4,105,450,000(L)	72.56%
Investments Limited(3)

Notes:

• (1) The letter “L” represents the long position in Shares.

• (2) Standard Chartered Trust (Singapore) Limited, as trustee of the Hua Sheng Trust, which was established by Mr. Wang Zhenhua as settlor in favour of his family members, held 100% of the issued share capital of Infinity Fortune Development Limited through its nominee SCTS Capital Pte. Ltd., which in turn held 100% of the issued share capital of First Priority Group Limited.

• (3) Wealth Zone Hong Kong Investments Limited is held as to 100% of its issued share capital by First Priority Group Limited.

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GENERAL INFORMATION

APPENDIX II

Save as disclosed above, and as at the Latest Practicable Date, the Directors were not aware of any persons (who were not Directors or chief executive of the Company) who had an interest or short position in the Shares or underlying Shares of the Company which would fall to be disclosed under Divisions 2 and 3 of Part XV of the SFO, or which would be required, pursuant to Section 336 of the SFO, to be entered in the register referred to therein.

DIRECTORS’ SERVICE CONTRACTS AND LETTER OF APPOINTMENT

As at the Latest Practicable Date, none of the Directors had entered, or proposed to enter, into a service contract with any member of the Group (excluding contracts expiring or determinable by relevant member of the Group within one year without payment of compensation, other than statutory compensation).

COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors or their respective associates had engaged in or had any interest in any business which competes or may compete with the businesses of the Group.

DIRECTORS’ INTERESTS IN ASSETS/CONTRACTS AND OTHER INTERESTS

On April 1, 2016, Hong Kong Chuangzhi Development Limited (香港創智發展有限公司) (“Chuangzhi”), being an indirect wholly-owned subsidiary of the Company, entered into an equity transfer agreement with Wealth Zone Hong Kong Investments Limited (富域香港投資 有限公司) (“Wealth Zone”), a controlling shareholders of the Company, and Changzhou Chuangyue Consultancy Co., Ltd* (常州創悅諮詢管理有限公司) (“Chuangyue”), pursuant to which Chuangzhi has conditionally agreed to sell and Wealth Zone has conditionally agreed to purchase the 100% equity interest in Chuangyue at a total consideration of RMB320 million. Wealth Zone is beneficially owned by Hua Sheng Trust, a discretionary trust set up by Mr. Wang Zhenhua, a controlling shareholder, an executive Director and the chairman of the Company, in favour of his family members, and Mr. Wang Xiaosong, a non-executive Director.

Save as disclosed above, as at the Latest Practicable Date,

• (i) none of the Directors had any direct or indirect interests in any assets (since December 31, 2015, being the date to which the latest published audited consolidated financial statements of the Group were made up), which had been acquired or disposed of by, or leased to the Company or any member of the Group (including any company which will become a subsidiary of the Company by reason of an acquisition which has been agreed or proposed since December 31, 2015, being the date to which the latest published audited consolidated financial statements of the Group were made up), or were proposed to be acquired or disposed of by, or leased to, the Company or any member of the Group (including any company which will become a subsidiary of the Company by reason of an acquisition which has been agreed or proposed since December 31, 2015, being the date to which the latest audited consolidated financial statements of the Group were made up); and

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APPENDIX II

• (ii) none of the Directors was materially interested in any contract or arrangement entered into by the Company or any member of the Group (including any company which will become a subsidiary of the Company by reason of an acquisition which has been agreed or proposed since December 31, 2015, being the date to which the latest audited consolidated financial statements of the Group were made up) which contract or arrangement was subsisting as at the Latest Practicable Date and which was significant in relation to the business of the Group (including any company which will become subsidiary of the Company by reason of an acquisition which has been agreed or proposed since December 31, 2015, being the date to which the latest audited consolidated financial statements of the Group were made up).

MATERIAL CONTRACTS

The following contracts (not being contracts in the ordinary course of business) have been entered into by member of the Group within the two years preceding the Latest Practicable Date:

• (a) On August 13, 2015, Future Land Wanbo Property Co., Ltd. (新城萬博置業有限公 司) (“ Future Land Wanbo ”), Taizhou Future Land Wanbo Real Estate Co., Ltd. (台州新城萬博房地產發展有限公司) (“ Taizhou Future Land ”) and Shenzhen Pingan Dahua Huitong Wealth Management Co., Ltd. (深圳平安大華匯通財富管理 有限公司) (“ Pingan Dahua ”) entered into an agreement (“ Taizhou Agreement* ”), pursuant to which Future Land Wanbo will further invest RMB300 million in equity capital in Taizhou Future Land by capitalising the shareholder’s loan and Pingan Dahua will invest RMB600 million in equity capital in Taizhou Future Land in cash to form a joint venture in relation to the development of the target land parcel located in Taizhou, Zhejiang, the PRC. After the capital injection, Taizhou Future Land will change from a wholly-owned subsidiary of Future Land Wanbo to an equity joint venture in which Future Land Wanbo and Pingan Dahua hold 40% and 60% equity interests, respectively.

• (b) On October 27, 2015, Future Land Wanbo, Chengdu Future Land Wanbo Real Estate Co., Ltd. (成都新城萬博房地產發展有限公司) (“ Chengdu Future Land ”) and Beijing Qianshi Chuangfu Asset Management Co., Ltd. (北京千石創富資本管理有 限公司) (“ Beijing Qianshi ”) entered into an agreement (“ Chengdu Agreement ”), pursuant to which Beijing Qianshi will invest RMB800 million in equity capital in Chengdu Future Land in cash to form a joint venture in relation to the development of the target land parcel located in Chengdu, Sichuan, the PRC. After the capital injection, Chengdu Future Land will change from a wholly-owned subsidiary of Future Land Wanbo to an equity joint venture in which Future Land Wanbo and Beijing Qianshi hold 11.11% and 88.89% equity interests, respectively.

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GENERAL INFORMATION

APPENDIX II

• (c) On April 1, 2016, Hong Kong Chuangzhi Development Limited (香港創智發展有限 公司) (“ Chuangzhi ”), being an indirect wholly-owned subsidiary of the Company, entered into an equity transfer agreement with Wealth Zone Hong Kong Investments Limited (富域香港投資有限公司) (“ Wealth Zone ”), a controlling shareholders of the Company, and Changzhou Chuangyue Consultancy Co., Ltd (常州創悅諮詢管 理有限公司) (“ Chuangyue* ”), pursuant to which Chuangzhi has conditionally agreed to sell and Wealth Zone has conditionally agreed to purchase the 100% equity interest in Chuangyue at a total consideration of RMB320 million.

MATERIAL LITIGATION

As at the Latest Practicable Date, none of the members of the Group was engaged in any litigation, arbitration or claim of material importance and no litigation, arbitration or claim of material importance was known to the Directors to be pending or threatened by or against any member of the Group.

MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors confirm that there was no material adverse change in the financial or trading position of the Group since December 31, 2015, the date to which the latest published audited consolidated financial statements of the Group were made up.

MISCELLANEOUS

• (a) The registered office of the Company is situated at Floor 4, Willow House, Cricket Square, P.O. Box 2804 Grand Cayman, KY1-1112, Cayman Islands and its principal place of business in Hong Kong is 36/F, Tower Two, Times Square, 1 Matheson Street Causeway Bay, Hong Kong.

• (b) The Company’s Hong Kong share registrar and transfer office is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.

• (c) The joint company secretaries of the Company are Mr. Chan Wai Kin and Ms. Mok Ming Wai, who is an associate member of The Hong Kong Institute of Company Secretaries.

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GENERAL INFORMATION

APPENDIX II

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during normal business hours (except Saturdays and public holidays) at Units 7801-03, 78/F, The Centre, 99 Queen’s Road Central, Hong Kong for a period of 14 days from the date of this circular:

• (a) this circular and the circular of the Company for discloseable and connected transaction of disposal of a wholly-owned subsidiary dated April 18, 2016;

• (b) the Acquisition Agreement;

• (c) the Preferential Rights Agreement;

• (d) the material contracts referred to in the section headed “Material contracts” in this appendix; and

• (e) the memorandum and articles of association of the Company.

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