Seazen Group Limited - Proxy Solicitation & Information Statement 2019

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

If you have sold or transferred all your shares in Future Land Development Holdings Limited, you should at once hand this circular with the enclosed form of proxy to the purchaser or transferee or to the bank, licensed securities dealer 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)

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME, PROPOSED CHANGE OF ENGLISH COMPANY NAME, PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION AND NOTICE OF EXTRAORDINARY GENERAL MEETING

A notice convening the extraordinary general meeting (the “ EGM ”) of Future Land Development Holdings Limited to be held at Unit 3703, 37/F, The Center, 99 Queen’s Road Central, Hong Kong on Wednesday, 30 October 2019 at 9:30 a.m. is set out on pages 52 to 54 of this circular. A form of proxy for use at the EGM is also enclosed. Such form of proxy is also published on the website of The Stock Exchange of Hong Kong Limited at www.hkexnews.hk. Whether or not you are able to attend the EGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return it to the Hong Kong branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong as soon as possible but in any event not less than 48 hours before the time appointed for the holding of the EGM (i.e. before 9:30 a.m. on 28 October 2019). Completion and return of the form of proxy will not preclude shareholders from attending and voting in person at the EGM or any adjourned meeting thereof if they so wish.

8 October 2019

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
APPENDIX – SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY
SHARE INCENTIVE SCHEME . . . . . . . . . . . . . . . . . . . . . . . . .	10
NOTICE OF EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	52

– i –

DEFINITIONS

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

“A Shares”

share(s) of Seazen Holdings which are listed on the SSE and traded and denominated in RMB

“Administrative Measures”
the Administrative Measures on Equity Incentives of Listed Companies
“Announcement” the announcement of the Company dated 27 September 2019 in relation to the proposal of the Subsidiary Share Incentive Scheme
“Articles of Association” the articles of association of the Company conditionally adopted by special resolution of the Shareholders on 6 November 2012, and as amended, supplemented or otherwise modified from time to time
“Board” the board of Directors
“Change of English Company Name”
the proposed change of English name of the Company from “Future Land Development Holdings Limited” to “Seazen Group Limited”
“Company”

Future Land Development Holdings Limited (新城發展控股有限公司), an exempted company incorporated on 23 April 2010 with limited liability under the laws of the Cayman Islands, with its Shares listed on the main board of the Stock Exchange

“Company Law” Company Law of the PRC
“CSRC”
China Securities Regulatory Commission
“Director(s)” the director(s) of the Company from time to time
“EGM”

the extraordinary general meeting of the Company to be convened on Wednesday, 30 October 2019 for the purpose of considering, among others, (i) the proposed adoption of the Subsidiary Share Incentive Scheme; (ii) the proposed Change of English Company Name; and (iii) the proposed adoption of the Second Amended and Restated M&A

– 1 –

DEFINITIONS

“Grant Date”
the date on which Seazen Holdings shall grant Share Option(s) or Restricted Shares (as the case maybe) to the Participants, which must be a trading day
“Group”
the Company together with its subsidiaries
“HK$” Hong Kong dollars, the lawful currency of Hong Kong
“Hong Kong” Hong Kong Special Administrative Region of the People’s Republic of China
“Latest Practicable Date” 4 October 2019, being the latest practicable date prior to the printing of this circular for ascertaining certain information for inclusion in this circular
“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange, as amended from time to time
“Participant(s)”
participant(s) to be granted the Shares Option(s) or Restricted Shares (as the case maybe) according to the Subsidiary Share Incentive Scheme
“PRC”
the People’s Republic of China, excluding for the purposes of this circular, Hong Kong, Macau and Taiwan
“Restricted Shares”
the A Shares to be granted to Participants pursuant to the Subsidiary Restricted Incentive Scheme
“RMB”
Renminbi, the lawful currency of the PRC
“Seazen Holdings”
Seazen 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)
“Seazen Holdings Board”
the board of directors of Seazen Holdings
“Second Amended and Restated M&A”
the second amended and restated memorandum and articles of association of the Company proposed to be adopted at the EGM
“Securities Law”

Securities Law of the PRC

“Share(s)”
ordinary share(s) in the share capital of the Company with a par value of HK$0.001 each

– 2 –

DEFINITIONS

“Share Option(s)”

“Shareholder(s)”

“SSE”
“Stock Exchange”
“Subsidiary Share Incentive Scheme”
“Subsidiary Option Scheme”
“Subsidiary Restricted Incentive Scheme”

“%”

the rights to be granted by the Company to the Participants to purchase a certain number of A Share(s) at a predetermined price and conditions within a certain period of time in the future

the holder(s) of the Share(s)

The Shanghai Stock Exchange

The Stock Exchange of Hong Kong Limited

the Seazen Holdings 2019 Share Option and Restricted Shares Scheme, consisting of the Subsidiary Option Scheme and the Subsidiary Restricted Incentive Scheme
the share option incentive scheme of Seazen Holdings to be approved by the shareholders of Seazen Holdings and the Shareholders, a summary of the principal terms of which is set out in the Appendix of this circular

the restricted share incentive scheme of Seazen Holdings to be approved by shareholders of Seazen Holdings and the Shareholders, a summary of the principal terms of which is set out in the Appendix of this circular

per cent

– 3 –

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 Directors: Mr. LV Xiaoping (Chief Executive Officer) Mr. QU Dejun (Vice-Chairman) Mr. LU Zhongming

Non-executive Directors : Mr. WANG Xiaosong (Chairman) Mr. ZHANG Shengman

Independent Non-executive Directors : Mr. CHEN Huakang Mr. ZHU Zengjin Mr. ZHONG Wei

Registered office: Grand Pavilion Hibiscus Way 802 West Bay Road P.O. Box 31119 KY1-1205 Cayman Islands

Principal place of business in Hong Kong: 31/F, Tower Two Times Square 1 Matheson Street Causeway Bay Hong Kong

8 October 2019

To the Shareholders

Dear Sir or Madam,

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME, PROPOSED CHANGE OF ENGLISH COMPANY NAME, PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION AND NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information in respect of the resolutions to be proposed at the EGM relating to (i) proposed adoption of the Subsidiary Share Incentive Scheme; (ii) the proposed Change of English Company Name; and (iii) the proposed adoption of the Second Amended and Restated M&A, and to seek your approval of the resolutions in relation thereto to be proposed at the EGM.

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LETTER FROM THE BOARD

This circular contains the explanatory statement in compliance with the Listing Rules and to give all the information reasonably necessary to enable the Shareholders to make an informed decision on whether to vote for or against the resolutions.

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

Reference is made to the Announcement. Seazen Holdings has convened a board meeting on 27 September 2019 to adopt the Subsidiary Share Incentive Scheme, comprising the Subsidiary Option Scheme and the Subsidiary Restricted Incentive Scheme. The purpose of the Subsidiary Share Incentive Scheme is to further establish and improve Seazen Holdings’ long-term incentives mechanism, attract and retain quality talents, fully motivate the directors, senior and middle management and key personnel of Seazen Holdings, and effectively integrate the shareholders’ interests of Seazen Holdings, Seazen Holdings’ interests and individual interests of the management such that the parties will make joint efforts for Seazen Holdings’ long-term development.

Seazen Holdings is a subsidiary of the Company with its A Shares listed on the SSE (stock code: 601155). It is principally engaged in real estate development and sales.

A total of 15,568,800 share options may be granted under the Subsidiary Option Scheme while a total of 11,663,600 A Shares may be granted under the Subsidiary Restricted Incentive Scheme. Subject to the approval of the Subsidiary Share Incentive Scheme by the shareholders of Seazen Holdings and the Company, a total of 14,515,000 share options (which is convertible into 14,515,000 A Shares) will be initially granted under the Subsidiary Option Scheme while the total number of A Shares that will be initially granted under the Subsidiary Restricted Incentive Scheme is 10,547,000 A Shares.

The shares to be issued upon an exercise of Share Options granted under the Subsidiary Option Scheme will be the A shares of Seazen Holdings, not the Company’s Shares. The A Shares granted under the Subsidiary Restricted Incentive Scheme are A Shares that Seazen Holdings has repurchased from the secondary market.

It is anticipated that there will be 108 participants in the Subsidiary Share Incentive Scheme, including directors, senior and middle management and key personnel of Seazen Holdings. All participants must be in the employment with Seazen Holdings or its subsidiaries during the assessment period of the Subsidiary Share Incentive Scheme.

The validity period of the Subsidiary Share Incentive Scheme shall commence on the completion date of registration of Shares Option exercised/Restricted Shares granted (as the case may be under the scheme) and end on the date on which all of the share options granted/Restricted Shares awarded (as the case may be under the Subsidiary Share Incentive Scheme) to the participants have been exercised/unlocking all restrictions or cancelled, which shall not exceed 54 months.

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LETTER FROM THE BOARD

Pursuant to the initial grant, the exercise price of Shares Option granted under the Subsidiary Option Scheme and the purchase price of the A Shares granted under Subsidiary Restricted Incentive Scheme is RMB27.40 per share and RMB13.70 per share respectively.

General Information on the Subsidiary Share Incentive Scheme

The Subsidiary Option Scheme under the Subsidiary Share Incentive Scheme constitutes a share option scheme under Chapter 17 of the Listing Rules. Pursuant to Rule 17.02(1)(a) of the Listing Rules, the adoption of the Subsidiary Share Incentive Scheme is conditional upon the approval of the Shareholders in the EGM.

Upon adoption of the Subsidiary Share Incentive Scheme, the Company will disclose the required information in relation to the Subsidiary Option Scheme in its subsequent annual report(s) and interim report(s) in accordance with the disclosure requirements under Chapter 17.07 of the Listing Rules.

A summary of the principal terms of the Subsidiary Share Incentive Scheme is set out in the Appendix to this circular. A copy of the Subsidiary Share Incentive Scheme will be available for inspection during normal business hours at Unit 3703, 37/F, The Center, 99 Queen’s Road Central, Hong Kong from 8 October 2019 to 30 October 2019.

As at the Latest Practicable Date, the Subsidiary Option Scheme has not appointed any trustee, accordingly none of the Directors or the directors of Seazen Holdings is appointed as trustee of the Subsidiary Option Scheme or has direct or indirect interests in any trustee of the Subsidiary Option Scheme.

No Shareholder is required to abstain from voting under the Listing Rules on the ordinary resolution in respect of the adoption of the Subsidiary Share Incentive Scheme at the EGM.

PROPOSED CHANGE OF ENGLISH COMPANY NAME

The Board proposes to change the English name of the Company from “Future Land Development Holdings Limited” to “Seazen Group Limited” with the dual foreign name in Chinese of the Company remaining unchanged as “新城發展控股有限公司”.

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LETTER FROM THE BOARD

Conditions of the proposed Change of English Company Name

The proposed Change of English Company Name is subject to the fulfillment of the following conditions:

(a) the passing of a special resolution by the Shareholders to approve the Change of English Company Name at the EGM; and
(b) the Registrar of Companies in the Cayman Islands granting approval for the proposed Change of English Company Name by issuing a certificate of incorporation on change of name.

Subject to the satisfaction of all the conditions set out above, the proposed Change of English Company Name will take effect upon the date of issue of the certificate of incorporation on change of name by the Registrar of Companies in the Cayman Islands.

The Company will then carry out the necessary filing procedures with the Companies Registry in Hong Kong.

Reasons for the proposed Change of English Company Name

The Company’s major subsidiary, Future Land Holdings Co., Ltd. (新城控股集團股份有限公司), whose A Shares are listed on the SSE (stock code: 601155), has changed its English name to Seazen Holdings Co., Ltd. with effect from 27 August 2018. The Directors believe that the new English name of the Company will better reflect the Group’s development goals and business strategies and further optimize the Group’s brand. The Directors (including the independent non-executive Directors) consider that the proposed Change of English Company Name is in the interests of the Company and the Shareholders as a whole.

Effect of the proposed Change of English Company Name

The proposed Change of English Company Name will not affect any of the rights of the holders of securities of the Company nor the Company’s daily business operation and its financial position.

All existing certificates of securities in issue bearing the present name of the Company shall, after the proposed Change of English Company Name becomes effective, continue to be evidence of title to such securities of the Company and will continue to be valid for trading, settlement, registration and delivery purposes. Accordingly, there will not be any arrangement for free exchange of existing share certificates of the Company for new share certificates printed in the new name of the Company.

* for identification purpose only

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LETTER FROM THE BOARD

Upon the proposed Change of English Company Name becomes effective, any new share certificates will be issued in the new name of the Company and the securities of the Company will be traded on the Stock Exchange under the new name.

In addition, subject to the confirmation of the Stock Exchange, the English stock short name for trading in the Shares on the Stock Exchange will also be changed after the proposed Change of English Company Name becomes effective.

The Company will make further announcement(s) to inform the Shareholders of the results of the EGM, the effective date of the proposed Change of English Company Name, the new English stock short name for trading in the shares of the Company on the Stock Exchange and other relevant information.

PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION

In view of the proposed Change of English Company Name, the Board also proposed to adopt the Second Amended and Restated M&A to reflect the Change of English Company Name, with the Second Amended and Restated M&A taking effect upon the Change of English Company Name becomes effective. The proposed adoption of the Second Amended and Restated M&A is subject to the fulfilment of the conditions set out in the paragraph headed “Conditions of the proposed Change of English Company Name” in this circular and the passing of a special resolution by the Shareholders at the EGM approving the adoption of the Second Amended and Restated M&A.

The only proposed amendment made by the Second Amended and Restated M&A to the existing memorandum and Articles of Association of the Company is to replace the English name of the Company from “Future Land Development Holdings Limited” to “Seazen Group Limited” with the dual foreign name in Chinese of the Company remaining unchanged as “新城發展控股有限公司”.

NOTICE OF EXTRAORDINARY GENERAL MEETING

Set out on pages 52 to 54 of this circular is the notice of the EGM containing, inter alia, resolutions to be proposed to consider and, if thought fit, approve (i) the proposed adoption of the Subsidiary Share Incentive Scheme; (ii) the proposed Change of English Company Name; and (iii) the proposed adoption of the Second Amended and Restated M&A.

FORM OF PROXY

A form of proxy is enclosed for use at the EGM. Such form of proxy is also published on the website of the Stock Exchange at www.hkexnews.hk. Whether or not you intend to be present at the EGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return it to the Hong Kong branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor,

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LETTER FROM THE BOARD

Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not less than 48 hours before the time fixed for the holding of the EGM (i.e. before 9:30 a.m. on 28 October 2019) or at any adjournment thereof. Completion and return of the form of proxy will not preclude Shareholders from attending and voting in person at the EGM or any adjourned meeting thereof if they so wish.

VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of Shareholders at a general meeting (save for certain procedural or administrative matters) must be taken by poll. The chairman of the EGM shall therefore demand voting on all resolutions set out in the notice of EGM be taken by way of poll pursuant to article 13.6 of the Articles of Association.

On a poll, every Shareholder present in person or by proxy or, in the case of a Shareholder being a corporation, by its duly authorised representative shall have one vote for every fully paid Share of which he is the holder. A Shareholder entitled to more than one vote on a poll needs not use all his votes or cast all the votes he uses in the same way.

RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts the omission of which would make any statement in this circular misleading.

RECOMMENDATION

The Directors consider that the proposed adoption of the Subsidiary Share Incentive Scheme, the proposed Change of English Company Name and the proposed adoption of the Second Amended and Restated M&A are in the best interests of the Company and the Shareholders as a whole. The Directors therefore recommend the Shareholders to vote in favour of all the resolutions to be proposed at the EGM.

Yours faithfully, By Order of the Board

Future Land Development Holdings Limited

WANG Xiaosong

Chairman

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

I. PURPOSE OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

The Subsidiary Share Incentive Scheme is formulated to further establish and improve Seazen Holdings’ long-term incentives mechanism, attract and retain quality talents, fully motivate the directors, senior and middle management and key personnel of Seazen Holdings, and effectively integrate the shareholders’ interests of Seazen Holdings, Seazen Holdings’ interests and individual interests of the management such that the parties will make joint efforts for Seazen Holdings’ long-term development.

II. METHOD OF THE SUBSIDIARY SHARE INCENTIVE SCHEME AND SOURCE OF THE UNDERLYING SHARES

The method of equity incentive of the Subsidiary Share Incentive Scheme is to grant Share Options and Restricted Shares to the Participants.

The source of the shares of the Share Options shall be ordinary A Shares of Seazen Holdings to be directly issued to the Participants by Seazen Holdings. The source of the shares of the Restricted Shares is 11,663,600 ordinary A Shares of Seazen Holdings repurchased by Seazen Holdings on the secondary market.

III. THE NUMBER OF SHARE OPTIONS AND RESTRICTED SHARES TO BE GRANTED UNDER THE SUBSIDIARY SHARE INCENTIVE SCHEME

The number of entitlements to be granted to the Participants under the Subsidiary Share Incentive Scheme is 27,232,400 in total, and the type of the underlying shares involved are RMB ordinary A Shares, representing approximately 1.21% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement, of which 25,062,000 entitlements will be granted under the initial grant, representing 1.11% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement and 92.03% of the total number of entitlements under this grant; and 2,170,400 entitlements will be reserved, representing 0.10% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement and 7.97% of the total number of entitlements under this grant. Details of the grant are as follows:

The Subsidiary Option Scheme: Seazen Holdings intends to grant 15,568,800 Share Options to the Participants, and the underlying shares of the Share Options are RMB ordinary A Shares, representing 0.69% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement, of which 14,515,000 Share Options will be granted under the initial grant, representing 0.64% of the total number of shares of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement and 93.23% of the total number of Share Options under this grant; and 1,053,800 Share Options will be reserved, representing 0.05% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

of the Announcement and 6.77% of the total number of Share Options under this grant. Each share option entitles the Participants the right to purchase one A Share of Seazen Holdings at the exercise price within the validity period, subject to the exercise conditions.

The Subsidiary Restricted Incentive Scheme: Seazen Holdings intends to grant 11,663,600 Restricted Shares of Seazen Holdings to the Participants, and the underlying shares are RMB ordinary A Shares, representing approximately 0.52% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement, of which 10,547,000 Restricted Shares will be granted under the initial grant, representing 0.47% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement and 90.43% of the total number of Restricted Shares under this grant; and 1,116,600 Restricted Shares will be reserved, representing 0.05% of the total share capital of Seazen Holdings (i.e. 2,256,724,186 shares) as at the date of the Announcement and 9.57% of the total number of Restricted Shares under this grant.

In the event of any capitalisation issue, bonus issue, sub-division or rights issue and share consolidation of Seazen Holdings during the period from the date of the Announcement to the completion of the exercise of Share Options or that of the Restricted Shares by the Participants, the number of Share Options and Restricted Shares and the total number of the underlying shares involved shall be adjusted accordingly.

IV. SCOPE AND ALLOCATION OF THE PARTICIPANTS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Basis for determining the Participants

1. Legal basis for determining the Participants

The Participants of the Subsidiary Share Incentive Scheme are determined after taking into account the circumstances of Seazen Holdings and in accordance with the requirements of the relevant laws, regulations and regulatory documents of the PRC including the Company Law, the Securities Law and the Administrative Measures, as well as the articles of association of Seazen Holdings.

2. Position basis for determining the Participants

The Participants of the Subsidiary Share Incentive Scheme include the directors and senior and middle management and key personnel of Seazen Holdings, including controlled subsidiaries but excluding independent directors and supervisors of Seazen Holdings.

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

(B) Scope of the Participants

There are a total of 108 Participants under the Subsidiary Share Incentive Scheme, including:

directors and senior management of Seazen Holdings;
middle management and key personnel of Seazen Holdings.

The Participants under the Subsidiary Share Incentive Scheme shall exclude independent directors, supervisors of Seazen Holdings and shareholders who individually or in aggregate hold more than 5% of the A Shares of Seazen Holdings or the de facto controllers and their respective spouse, parents and/or children.

Among the Participants aforementioned, directors and senior management must be elected by the general meetings or appointed by the Seazen Holdings Board. All Participants must be in the employment with Seazen Holdings or its subsidiaries during the assessment period of the Subsidiary Share Incentive Scheme.

Participants for the reserved grant shall be determined within 12 months from the date on which the Subsidiary Share Incentive Scheme is considered and passed at the general meeting. Following the proposals from the Seazen Holdings Board, issuance of clear opinions by the independent directors and the supervisory committee of Seazen Holdings as well as issuance of professional opinions and legal opinions by the legal adviser, Seazen Holdings shall promptly and accurately disclose the relevant information in relation to such Participants on the designated website pursuant to the relevant requirements. The reserved entitlements shall lapse where the Participants are not determined after 12 months from the aforesaid date. The criteria for determining the Participants under the reserved grant shall be the same as the criteria for the initial grant.

(C) Circumstances for disqualification of the Participants

such Participant is deemed as an inappropriate candidate by the relevant stock exchange in the last 12 months;
such Participant is deemed as an inappropriate candidate by the CSRC or its subordinate bodies in the last 12 months;
such Participant has been imposed administrative penalties or is banned from the securities market by the CSRC or its subordinate bodies due to material noncompliance of laws and regulations in the last 12 months;
such Participant is prohibited from acting as a director or member of the senior management of Seazen Holdings under the Company Law;

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

such Participant is prohibited by the law from participating in stock incentive scheme of listed companies;
such other circumstances as determined by the CSRC.

Such Participants shall be disqualified if they trade the A Shares of Seazen Holdings with the knowledge of inside information or leak inside information that leads to insider trading within 6 months prior to the draft of the Subsidiary Share Incentive Scheme and the Announcement.

(D) Verification of the Participants

After the Seazen Holdings Board has reviewed and approved the Subsidiary Share Incentive Scheme, Seazen Holdings shall internally publish the names and positions of the Participants for a period of no less than 10 days.
The supervisory committee of Seazen Holdings shall verify the list of the Participants and thoroughly consider opinions from the public. Seazen Holdings shall disclose the opinions of the supervisory committee on the verification of and the public opinions in relation to the list of the Participants 5 days before the Subsidiary Share Incentive Scheme is considered at a general meeting of Seazen Holdings. Any adjustments to the list of Participants made by the Seazen Holdings Board shall also be subject to verification by the supervisory committee of Seazen Holdings.

(E) Allocation of the Share Options and Restricted Shares granted to the Participants

The following table sets forth the allocation of Share Options among the Participants under the initial grant:

Name Position in Seazen Holdings Liang Zhicheng Director and Co-President Chen Deli Director and Co-President Yuan Boyin Director and Co-President Guan Youdong Financial Officer Chen Peng Secretary to the Seazen Holdings Board Middle Management and Key Personnel (103 People) Reserved Total	Number of Share Options granted (0’000 shares) 32.80 32.80 32.80 25.40 12.10 1,315.60 105.38 1,556.88	Proportion to the total number of Share Options granted 2.11% 2.11% 2.11% 1.63% 0.78% 84.50% 6.77% 100.00%	Proportion to Seazen Holdings’ current total share capital 0.01% 0.01% 0.01% 0.01% 0.01% 0.58% 0.05%
			0.69%

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

Notes:

None of the A Shares of Seazen Holdings granted through all valid equity incentive schemes held by each of the Participants above exceeded or will exceed 1% of the total share capital of Seazen Holdings. The total number of underlying shares involved in all of Seazen Holdings’ valid incentive schemes does not exceed 10% of the total share capital of Seazen Holdings when the equity incentive schemes were submitted to the general meeting.
The Participants under the Subsidiary Share Incentive Scheme exclude substantial shareholders who hold more than 5% of the A Shares of Seazen Holdings or the de facto controllers and their respective spouse, parents and/or children.
Participants for the reserved grant shall be determined within 12 months from the date on which the Subsidiary Share Incentive Scheme is considered and passed at the general meeting. Following the proposals from the Seazen Holdings Board, issue of clear opinions by the independent directors and the supervisory committee of Seazen Holdings as well as issue of professional opinions and legal opinions by the legal adviser, Seazen Holdings shall promptly and accurately disclose the relevant information in relation to such Participants on the designated website pursuant to the relevant requirements. The reserved entitlements shall lapse automatically if not being granted within the specified time.

The following table sets forth the allocation of Restricted Shares among the Participants under the initial grant:

Name Position in Seazen Holdings Liang Zhicheng Director and Co-President Chen Deli Director and Co-President Yuan Boyin Director and Co-President Guan Youdong Financial Officer Chen Peng Secretary to the Seazen Holdings Board Middle Management and Key Personnel (31 People) Reserved Total	Number of Restricted Shares granted (0’000 Shares) 60.00 60.00 60.00 45.00 17.80 811.90 111.66 1,166.36	Proportion to the total number of Restricted Shares granted 5.14% 5.14% 5.14% 3.86% 1.53% 69.61% 9.57% 100.00%	Proportion to Seazen Holdings’ current total share capital 0.03% 0.03% 0.03% 0.02% 0.01% 0.36% 0.05%
			0.52%

Notes:

None of the A Shares of Seazen Holdings granted through all valid equity incentive schemes held by each of the Participants above exceeded or will exceed 1% of the total share capital of Seazen Holdings. The total number of underlying shares involved in all of Seazen Holdings’ valid incentive schemes does not exceed 10% of the total share capital of Seazen Holdings when the equity incentive schemes were submitted to the general meeting.
The Participants under the Subsidiary Share Incentive Scheme exclude substantial shareholders who hold more than 5% of the A Shares of Seazen Holdings or the de facto controllers and their respective spouse, parents and/or children.

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Participants for the reserved grant shall be determined within 12 months from the date on which the Subsidiary Share Incentive Scheme is considered and passed at the general meeting. Following the proposals from the Seazen Holdings Board, issuance of clear opinions by the independent directors and the supervisory committee of Seazen Holdings as well as issuance of professional opinions and legal opinions by the legal adviser, Seazen Holdings shall promptly and accurately disclose the relevant information in relation to such Participants on the designated website pursuant to the relevant requirements. The reserved entitlements shall lapse automatically if not being granted within the specified time.

V. EXERCISE PRICE OF THE SHARE OPTIONS AND GRANT PRICE OF THE RESTRICTED SHARES AND THE BASIS FOR DETERMINATION

(A) Exercise price of the Share Options

1. Exercise price of the Share Options under the initial grant

The exercise price of the Share Options under the initial grant is RMB27.40 per share.

2. Basis for determination of exercise price of the Share Options under the initial grant

The exercise price of the Share Options under the initial grant shall not be lower than the par value of the A Shares, and shall be not less than the higher of the followings:

(i) the average price of the A Shares of Seazen Holdings for the last trading day preceding the date of the Announcement (the total transaction value of the A Shares for the last trading day/total trading volume of the A Shares for the last trading day), being RMB27.40 per share;
(ii) the average price of the A Shares of Seazen Holdings for the last 20 trading days preceding the date of the Announcement (the total transaction value of the A Shares for the last 20 trading days/total trading volume of the A Shares for the last 20 trading days), being RMB26.13 per share.

3. Basis for determination of exercise price of the Share Options under the reserved grant

The exercise price of the Share Options under the reserved grant shall not be lower than the par value of the A Shares, and shall be not less than the higher of the following:

(i) the average price of the A Shares of Seazen Holdings for the last trading day preceding the date of the announcement on the resolution of the Seazen Holdings Board on the Share Options under the reserved grant;
(ii) the average price of the A Shares of Seazen Holdings for the last 20, 60 or 120 trading days preceding the date of the announcement on the resolution of the Seazen Holdings Board on the Share Options under the reserved grant.

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(B) Grant price of the Restricted Shares

1. Grant price of the Restricted Shares under the initial grant

The grant price of the Restricted Shares under the initial grant is RMB13.70 per share. Upon satisfaction of grant conditions, the Participants may purchase the repurchased shares of Seazen Holdings at RMB13.70 per share.

2. Basis for determination of grant price of the Restricted Shares under the initial grant

The grant price of the Restricted Shares under the initial grant shall not be lower than the par value of the A Shares, and shall be not less than the higher of the following:

(i) 50% of the average price of the A Shares of Seazen Holdings for the last trading day preceding the date of the Announcement (the total transaction value of the A Shares for the last trading day/total trading volume of the A Shares for the last trading day), being RMB27.40 per share, which is RMB13.70 per share;
(ii) 50% of the average price of the A Shares of Seazen Holdings for the last 20 trading days preceding the date of the Announcement (the total transaction value of the A Shares for the last 20 trading days/total trading volume of the A Shares for the last 20 trading days), being RMB26.13 per share, which is RMB13.07 per share.

3. Basis for determination of grant price of the Restricted Shares under the reserved grant

The grant price of the Restricted Shares under the reserved grant shall not be lower than the par value of the A Shares, and shall be not less than the higher of the following:

(i) 50% of the average price of the A Shares of Seazen Holdings for the last trading day preceding the date of announcement on the resolution of the Seazen Holdings Board on the Restricted Shares under the reserved grant;
(ii) 50% of the average price of the A Shares of Seazen Holdings for the last 20, 60 or 120 trading days preceding the date of announcement on the resolution of the Seazen Holdings Board on the Restricted Shares under the reserved grant.

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VI. EXERCISE SCHEDULE FOR THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Exercise schedule for the Share Options

1. Validity period of the Subsidiary Option Scheme

The validity period of the Subsidiary Share Incentive Scheme shall commence from the registration completion date of grant of the Share Options and end on the date on which all of the Share Options granted to the Participants have been exercised or cancelled, which shall not exceed 54 months.

2. Grant Date

The Grant Date shall be determined by the Seazen Holdings Board after the Subsidiary Share Incentive Scheme is considered and passed at the general meeting of Seazen Holdings, and must be a trading day. Seazen Holdings shall grant the Share Options and complete the announcement and registration procedures within 60 days from the date on which the Subsidiary Share Incentive Scheme is considered and passed at the general meeting. In accordance with the “Administrative Measures”, the period during which no entitlements shall be granted shall not be included in such 60 days.

3. Vesting period

The vesting periods of the Share Options under the initial grant under the Subsidiary Share Incentive Scheme are 12 months, 24 months and 36 months from the registration completion date of grant; the vesting periods of the Share Options under the reserved grant are 18 months and 30 months from the registration completion date of grant. The Share Options granted to the Participants are not transferable, or used as guarantee or for repayment of debts.

4. Exercise date

Upon passing of the Subsidiary Share Incentive Scheme at the general meeting, the Share Options so granted may be exercised after 12 months from the registration completion date of the relevant grant. The exercise date must be a trading day and shall not fall within any of the following periods:

(i) the period commencing from 30 days prior to the publication of periodic reports of Seazen Holdings, or in the event of delay in publishing the periodic reports for special reasons, 30 days prior to the original date of publication and ending on one day prior to the date of publication;
(ii) the period commencing from 10 days prior to the publication of the announcement of results forecast and preliminary results of Seazen Holdings;

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(iii) the period commencing from the date of occurrence of any significant event which may have significant effect on the trading prices of Seazen Holdings’ shares and their derivatives or the date on which relevant decision-making procedures start and ending on the second trading day following the publication in accordance with laws; and
(iv) other periods as stipulated by the CSRC and the SSE.

The following table sets forth the exercise period of the Share Options under the initial grant and the exercise schedule for each tranche:

Exercise	Exercise	Exercise
arrangement	Duration	proportion
First exercise	Commencing on the first trading day after expiry	40%
period	of the 12-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 24-month period from
	the registration completion date of the grant
Second exercise	Commencing on the first trading day after expiry	30%
period	of the 24-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 36-month period from
	the registration completion date of the grant
Third exercise	Commencing on the first trading day after expiry	30%
period	of the 36-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 48-month period from
	the registration completion date of the grant

The following table sets forth the exercise period of the Share Options under the reserved grant and the exercise schedule for each tranche:

Exercise	Exercise	Exercise
arrangement	Duration	proportion
First exercise	Commencing on the first trading day after expiry	50%
period	of the 18-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 30-month period from
	the registration completion date of the grant
Second exercise	Commencing on the first trading day after expiry	50%
period	of the 30-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 42-month period from
	the registration completion date of the grant

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5. Lock-up period

The lock-up period refers to the period during which there is sale restriction on the shares obtained by the Participants upon exercise. The lock-up provisions under the Subsidiary Share Incentive Scheme shall be implemented in accordance with the provisions of the relevant laws, regulations and regulatory documents including the Company Law and the Securities Law, as well as the articles of association of Seazen Holdings. Specific requirements are as follows:

(i) Where a Participant is a director or a member of the senior management of Seazen Holdings, the number of shares of Seazen Holdings which may be transferred by the Participant each year during his term of office shall not exceed 25% of the total number of shares of Seazen Holdings held by him. No shares of Seazen Holdings held by him shall be transferred within six months after his termination of office.
(ii) Where a Participant is a director or a member of the senior management of Seazen Holdings and he disposes of any shares of Seazen Holdings within six months after acquisition, or buys back such shares within six months after disposal, all gains arising therefrom shall be accounted to Seazen Holdings and the Seazen Holdings Board will collect all such gains.
(iii) If, during the validity period of the Subsidiary Share Incentive Scheme, there is any amendment to the requirements regarding transfer of shares by a director or member of the senior management of Seazen Holdings under the Company Law, the Securities Law and other relevant laws, regulations and regulatory documents as well as the articles of association of Seazen Holdings, such amended requirements under the Company Law, the Securities Law and other relevant laws, regulations and regulatory documents as well as the articles of association of Seazen Holdings shall apply to the A Shares of Seazen Holdings transferred by the Participants during the relevant times.

(B) Schedule for the Restricted Shares

1. Validity period of the Subsidiary Restricted Incentive Scheme

The validity period of the Subsidiary Share Incentive Scheme shall commence from the registration completion date of grant of the Restricted Shares and end on the date on which all of the Restricted Shares granted to the Participants have been unlocked or repurchased and cancelled, which shall not exceed 54 months.

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2. Grant Date

The Grant Date shall be determined by the Seazen Holdings Board after the Subsidiary Share Incentive Scheme is considered and passed at the general meeting of Seazen Holdings, and must be a trading day. Seazen Holdings shall grant the Restricted Shares and complete the announcement and registration procedures within 60 days from the date on which the Subsidiary Share Incentive Scheme is considered and passed at the general meeting.

The Participants shall not grant Restricted Shares during the following periods:

(i) the period commencing from 30 days prior to the publication of periodic reports of Seazen Holdings, or in the event of delay in publishing the periodic reports for special reasons, 30 days prior to the original date of publication and ending on one day prior to the date of publication;
(ii) the period commencing from 10 days prior to the publication of the announcement of results forecast and preliminary results of Seazen Holdings;
(iii) the period commencing from the date of occurrence of any significant event which may have significant effect on the trading prices of Seazen Holdings’ shares and their derivatives or the date on which relevant decision-making procedures start and ending on the second trading day following the publication in accordance with laws; and
(iv) other periods as stipulated by the CSRC and the SSE.

The period during which no entitlements shall be granted by Seazen Holdings shall not be included in such 60 days.

3. Restricted period

The restricted periods of the Restricted Shares under the initial grant under the Subsidiary Share Incentive Scheme are 12 months, 24 months and 36 months from the registration completion date of grant; the restricted periods of the Restricted Shares under the reserved grant are 18 months and 30 months from the registration completion date of grant. The Restricted Shares granted to the Participants under the Subsidiary Share Incentive Scheme are not transferable, or used as guarantee or for repayment of debts. The shares obtained by the Participants arising from capitalisation issue, bonus issue and sub-division due to the grant of Restricted Shares not yet unlocked to them shall be subject to locking in accordance with the Subsidiary Share Incentive Scheme.

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Upon unlocking of the Restricted Period, Seazen Holdings shall proceed with the unlocking for the Participants who satisfy the unlocking conditions, and the Restricted Shares held by the Participants who do not satisfy the unlocking conditions shall be repurchased by Seazen Holdings.

4. Unlocking arrangement

The following table sets forth the unlocking schedule for each tranche of the Restricted Shares under the initial grant:

Unlocking		Unlocking
arrangement	Unlocking time	proportion
First tranche of	Commencing on the first trading day after expiry	40%
unlocking	of the 12-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 24-month period from
	the registration completion date of the grant
Second tranche	Commencing on the first trading day after expiry	30%
of unlocking	of the 24-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 36-month period from
	the registration completion date of the grant
Third tranche of	Commencing on the first trading day after expiry	30%
unlocking	of the 36-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 48-month period from
	the registration completion date of the grant

The following table sets forth the unlocking schedule for each tranche of the Restricted Shares under the reserved grant:

Unlocking		Unlocking
arrangement	Unlocking time	proportion
First tranche of	Commencing on the first trading day after expiry	50%
unlocking	of the 12-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 24-month period from
	the registration completion date of the grant
Second tranche	Commencing on the first trading day after expiry	50%
of unlocking	of the 24-month period from the registration
	completion date of the grant and ending on the
	last trading day of the 36-month period from
	the registration completion date of the grant

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5. Lock-up period

The lock-up requirements under the Subsidiary Restricted Incentive Scheme shall be implemented in accordance with the relevant laws, regulations and regulatory documents of the Company Law and the Securities Law, as well as the articles of association of Seazen Holdings. Specific requirements are as follows:

(i) Where a Participant is a director or a member of the senior management of Seazen Holdings, the number of shares of Seazen Holdings which may be transferred by the Participant each year during his term of office shall not exceed 25% of the total number of shares of Seazen Holdings held by him. No shares of Seazen Holdings held by him shall be transferred within six months after his termination of office.
(ii) Where a Participant is a director or a member of the senior management of Seazen Holdings and he disposes any shares of Seazen Holdings within six months after acquisition, or buys back such shares within six months after disposal, all gains arising therefrom shall be accounted to Seazen Holdings and the Seazen Holdings Board will collect all such gains.
(iii) If, during the validity period of the Subsidiary Share Incentive Scheme, there is any amendment to the requirements regarding transfer of shares by a director and a member of the senior management of Seazen Holdings under the Company Law, the Securities Law and other relevant laws, regulations and regulatory documents as well as the articles of association of Seazen Holdings, such amended requirements under the Company Law, the Securities Law and other relevant laws, regulations and regulatory documents as well as the articles of association of Seazen Holdings shall apply to the A Shares of Seazen Holdings transferred by the Participants during the relevant time.

VII. CONDITIONS OF GRANT OF SHARE OPTIONS/RESTRICTED SHARES AND CONDITIONS OF EXERCISE/UNLOCKING

(A) Conditions of grant and exercise of Share Options

1. Conditions of grant of the Share Options

The grant of Share Options to the Participants is subject to each of the following conditions:

(i) None of the following circumstances has occurred on Seazen Holdings:
① issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the financial accounting report of Seazen Holdings for its most recent accounting year;

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② issuance of an auditors’ report with an adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the internal control of the financial report of Seazen Holdings for its most recent accounting year;
③ failure to conduct profit distribution in accordance with laws and regulations, the articles of association of Seazen Holdings and public undertakings during the 36 months after listing;
④ prohibition from implementation of share incentive scheme by laws and regulations;
⑤ any other circumstances as determined by the CSRC.
(ii) None of the following circumstances has occurred on the Participants:
① such Participant is deemed as an inappropriate candidate by the relevant stock exchange in the last 12 months;
② such Participant is deemed as an inappropriate candidate by the CSRC or its subordinate bodies in the last 12 months;
③ such Participant has been imposed administrative penalties or is banned from the securities market by the CSRC or its subordinate bodies due to material non-compliance of laws and regulations in the last 12 months;
④ such Participant is prohibited from acting as a director or a member of the senior management of Seazen Holdings under the Company Law;
⑤ such Participant is prohibited by laws and regulations from participating in share incentive scheme of listed companies;
⑥ other circumstances as determined by the CSRC.

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2. Conditions of exercise of the Share Options

The exercise of Share Options granted to the Participants is subject to the following conditions:

(i) None of the following circumstances has occurred on Seazen Holdings:
① issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the financial accounting report of Seazen Holdings for its most recent accounting year;
② issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the internal control of the financial report of Seazen Holdings for its most recent accounting year;
③ failure to conduct profit distribution in accordance with laws and regulations, the articles of association of Seazen Holdings and public undertakings during the 36 months after listing;
④ prohibition from implementation of share incentive scheme by laws and regulations;
⑤ any other circumstances as determined by the CSRC.
(ii) None of the following circumstances has occurred on the Participants:
① such Participant is deemed as an inappropriate candidate by the relevant stock exchange in the last 12 months;
② such Participant is deemed as an inappropriate candidate by the CSRC or its subordinate bodies in the last 12 months;
③ such Participant has been imposed administrative penalties or is banned from the securities market by the CSRC or its subordinate bodies due to material non-compliance of laws and regulations in the last 12 months;
④ such Participant is prohibited from acting as a director or a member of the senior management of Seazen Holdings under the Company Law;
⑤ such Participant is prohibited by laws and regulations from participating in share incentive scheme of listed companies;
⑥ other circumstances as determined by the CSRC.

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If any of the circumstances specified in (i) above occurs on the part of Seazen Holdings, all of the Share Options granted to the Participants under the Subsidiary Share Incentive Scheme but not yet exercised shall be cancelled by Seazen Holdings. If any of the circumstances specified in (ii) above occurs on a Participant, the Share Options granted to the Participant under the Subsidiary Share Incentive Scheme but not yet exercised shall be cancelled by Seazen Holdings.

3. Under the Subsidiary Share Incentive Scheme, the financial performance indicators and individual performance indicators of Seazen Holdings shall be assessed annually during the three accounting years from 2019 to 2021. The exercise of Share Options by the Participants in the respective year shall be conditional upon the achievement of the appraisal targets for Seazen Holdings’ financial performance. Considering the requirements from shareholders of listed companies on Seazen Holdings’ business performance, net profit attributable to the parent after deducting non-recurring items is selected as an appraisal indicator for Seazen Holdings’ performance since it can reflect the profitability of the principal business of an enterprise. The setting of the target value has given due consideration to the achievement of Seazen Holdings’ future strategies and the shareholders’ requirements on the listed companies. The specific targets of the appraisal of performance for each year are as follows:

Actual individual exercisable limit for the respective year of the exercise period = Individual incentive limit × Exercisable percentage for the respective year × Coefficient of the performance of Seazen Holdings × Coefficient of individual performance.

(i) Appraisal requirements on Seazen Holdings’ performance

The Share Options granted under the initial grant of the Subsidiary Share Incentive Scheme are subject to annual assessment for exercise during the three accounting years in the exercise period. The exercise of Share Options shall be conditional upon the achievement of the performance targets. The specific performance targets for each year are as follows:

Exercise period

Performance appraisal target

First exercise period

The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2019 shall not be lower than 20% as compared to that for 2018

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Exercise period

Performance appraisal target

Second exercise The growth of net profit attributable to shareholders period of Seazen Holdings after deducting non-recurring gains/losses for 2020 shall not be lower than 70% as compared to that for 2018

Third exercise period The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2021 shall not be lower than 120% as compared to that for 2018

With respect to the Share Options under the reserved grant, during the two accounting years of the exercise period, performance appraisal and exercise of Share Options are conducted each year. The exercise of Share Options by the Participants shall be conditional upon the achievement of the appraisal targets of performance. The specific performance targets for each year are as follows:

Exercise period Performance appraisal target

First exercise period The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2020 shall not be lower than 70% as compared to that for 2018 Second exercise The growth of net profit attributable to shareholders period of Seazen Holdings after deducting non-recurring gains/losses for 2021 shall not be lower than 120% as compared to that for 2018

In the event that the performance appraisal targets of Seazen Holdings are achieved during the exercise period, the coefficient of the performance of Seazen Holdings shall be 1, failing which such coefficient shall be 0.

In the event that the coefficient of Seazen Holdings’ performance for the respective year is 0, the Share Options which should have been exercisable by all of the Participants in the respective assessment year shall not be exercised and shall be cancelled by Seazen Holdings.

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(ii) Appraisal requirements on individual performance

The actual exercisable limit of the Participants for the respective year shall be correlated to their individual performance appraisal in the prior year. The relevant percentage shall be determined based on the results of the individual performance appraisal of the Participants and the details are as follows:

Individual appraisal	A (Excellent)	B (Good)	C (Pass)	D (Fail)
results for the year
Individual performance	100%	100%	80%	0
coefficient

Seazen Holdings shall cancel the Share Options granted to the Participants which cannot be exercised in the respective year.

(B) Conditions of grant and unlocking of Restricted Shares

1. Conditions of grant of Restricted Shares

Restricted Shares shall be granted to the Participants by Seazen Holdings upon satisfaction of all the following conditions. In other words, Restricted Shares cannot be granted to the Participants if any of the following conditions of grant is not satisfied:

(i) None of the following circumstances has occurred on Seazen Holdings:
① issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the financial accounting report of Seazen Holdings for its most recent accounting year;
② issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the internal control of the financial report of Seazen Holdings for its most recent accounting year;
③ failure to conduct profit distribution in accordance with laws and regulations, the articles of association of Seazen Holdings and public undertakings during the 36 months after listing;
④ prohibition from implementation of share incentive scheme by laws and regulations;
⑤ any other circumstances as determined by the CSRC.

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(ii) None of the following circumstances has occurred on the Participants:
① such Participant is deemed as an inappropriate candidate by the relevant stock exchange in the last 12 months;
② such Participant is deemed as an inappropriate candidate by the CSRC or its subordinate bodies in the last 12 months;
③ such Participant has been imposed administrative penalties or is banned from the securities market by the CSRC or its subordinate bodies due to material non-compliance of laws and regulations in the last 12 months;
④ such Participant is prohibited from acting as a director or a member of the senior management of Seazen Holdings under the Company Law;
⑤ such Participant is prohibited by laws and regulations from participating in share incentive scheme of listed companies;
⑥ other circumstances as determined by the CSRC.

2. Conditions of unlocking of Restricted Shares

The Restricted Shares granted to the Participants can be unlocked upon expiry of the restricted period and satisfaction of all the following conditions:

(i) None of the following circumstances has occurred on Seazen Holdings:
① issue of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the financial accounting report of Seazen Holdings for its most recent accounting year;
② issue of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the internal control of the financial report of Seazen Holdings for its most recent accounting year;
③ failure to conduct profit distribution in accordance with laws and regulations, the articles of association of Seazen Holdings and public undertakings during the 36 months after listing;
④ prohibition from implementation of share incentive scheme by laws and regulations;
⑤ any other circumstances as determined by the CSRC.

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(ii) None of the following circumstances has occurred on the Participants:
① such Participant is deemed as an inappropriate candidate by the relevant stock exchange in the last 12 months;
② such Participant is deemed as an inappropriate candidate by the CSRC or its subordinate bodies in the last 12 months;
③ such Participant has been imposed administrative penalties or is banned from the securities market by the CSRC or its subordinate bodies due to material non-compliance of laws and regulations in the last 12 months;
④ such Participant is prohibited from acting as a director or a member of the senior management of Seazen Holdings under the Company Law;
⑤ such Participant is prohibited by laws and regulations from participating in share incentive scheme of listed companies;
⑥ other circumstances as determined by the CSRC.

If any of the circumstances specified in (i) above occurs on Seazen Holdings, all of the Restricted Shares granted to the Participants under the Subsidiary Share Incentive Scheme but not yet unlocked shall be repurchased by Seazen Holdings in accordance with the rules thereunder. If any of the circumstances specified in (ii) above occurs on a Participant, the Restricted Shares granted to the Participant under the Subsidiary Share Incentive Scheme but not yet unlocked shall be repurchased by Seazen Holdings.

3. Under the Subsidiary Share Incentive Scheme, the financial performance indicators and individual performance indicators of Seazen Holdings shall be assessed annually during the three accounting years from 2019 to 2021. The unlocking of the Restricted Shares granted to the Participants in the respective year shall be conditional upon the achievement of the appraisal targets for Seazen Holdings’ financial performance. Considering the requirements of shareholders of listed companies on Seazen Holdings’ business performance, net profit attributable to the parent after deducting non-recurring items is selected as an assessment indicator for Seazen Holdings’ performance since it can reflect the profitability of the principal business of an enterprise. The setting of the target value has given due consideration to the achievement of Seazen Holdings’ future strategies and the shareholders’ requirements on the listed companies. The specific targets of the appraisal of performance for each year are as follows:

Actual individual unlockable limit for the respective year = Individual incentive limit × Unlockable percentage for the respective year × Coefficient of the performance of Seazen Holdings × Coefficient of individual performance.

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(i) Seazen Holdings’ performance appraisal requirements

The Restricted Shares granted under the initial grant of the Subsidiary Share Incentive Scheme are subject to annual assessment and unlocking of Restricted Shares for the three accounting years during the restricted period. The unlocking of the Restricted Shares granted to the Participants shall be conditional upon the achievement of the performance targets. The performance targets for each year are as follows:

Unlocking

arrangement

Performance appraisal target

First tranche of unlocking

The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2019 shall not be lower than 20% as compared to that for 2018

Second tranche of unlocking
The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2020 shall not be lower than 70% as compared to that for 2018
Third tranche of The growth of net profit attributable to shareholders unlocking of Seazen Holdings after deducting non-recurring gains/losses for 2021 shall not be lower than 120% as compared to that for 2018

With respect to the Restricted Shares under the reserved grant, for the two accounting years during the restricted period, performance appraisal and unlocking of the Restricted Shares are conducted each year. The unlocking of the Restricted Shares granted to the Participants shall be conditional upon the achievement of the appraisal targets for performance. The performance targets for each year are as follows:

Unlocking

arrangement Performance appraisal target

First tranche of unlocking

The growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses for 2020 shall not be lower than 70% as compared to that for 2018

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Unlocking arrangement Performance appraisal target Second tranche of The growth of net profit attributable to shareholders unlocking of Seazen Holdings after deducting non-recurring gains/losses for 2021 shall not be lower than 120% as compared to that for 2018

In the event the performance appraisal targets of Seazen Holdings for unlocking are achieved, the coefficient of the performance of Seazen Holdings shall be 1, failing which such coefficient shall be 0.

In the event the coefficient of the performance of Seazen Holdings for the respective year is 0, the Restricted Shares which are unlockable by all of the Participants in the respective assessment year shall not be unlocked and shall be repurchased by Seazen Holdings.

(ii) Individual performance appraisal requirements

The actual unlockable limit of the Restricted Shares of the Participants for the respective year shall be correlated to their individual performance appraisal in the prior year. The relevant percentage shall be determined based on the results of the individual performance appraisal of the Participants and the details are as follows:

Individual appraisal A (Excellent) B (Good) C (Pass) D (Fail) results for the year Individual performance 100% 100% 80% 0 coefficient

Seazen Holdings shall repurchase the Restricted Shares granted to the Participants which cannot be unlocked in the respective year.

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(C) Scientificity and reasonableness of the appraisal indicators

The appraisal for the Subsidiary Share Incentive Scheme is categorised into two levels, i.e. performance appraisal at company level and performance appraisal at individual level.

The performance indicator at company level is the growth of net profit attributable to shareholders of Seazen Holdings after deducting non-recurring gains/losses, which manifests improved profitability, future development and the strategy concentrating on primary businesses of Seazen Holdings, while establishing a better image in the capital market. The determination of the specific target values takes into account the macroeconomic environment, the development of the industry, the market competition, Seazen Holdings’ future development planning and other relevant factors. After comprehensively considering the possibility of their realisation and the incentive effect on Seazen Holdings’ employees, such indicators are reasonable and scientific.

In addition to the performance appraisal at company level, Seazen Holdings has established a strict performance appraisal system for individuals, which evaluates the performance of the Participants in an accurate and all-round manner. Seazen Holdings will determine whether the Participants meet the exercise or unlocking conditions based on their performance appraisal results for the previous year.

Given the above, the appraisal system for the Subsidiary Share Incentive Scheme of Seazen Holdings is all-round, comprehensive and operable, and the appraisal indicators are scientific and reasonable, which are binding on the Participants and can serve the appraisal goal of the Subsidiary Share Incentive Scheme.

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VIII. METHOD AND PROCEDURES FOR ADJUSTMENT TO THE NUMBER AND PRICE OF ENTITLEMENT UNDER THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Method and procedures for adjustment for the Subsidiary Option Scheme

1. Method for adjustment of the number of the Share Options

In the event of any capitalisation issue, bonus issue, sub-division, rights issue or share consolidation of Seazen Holdings prior to any exercise of Share Options by the Participants, the number of Share Options shall be adjusted in the following manner accordingly:

(i) Capitalisation issue, bonus issue and sub-division of share capital

Q = Q0 × (1 + n)

Where: Q0 represents the number of Share Options prior to adjustment; n represents the rate of increase per share resulting from capitalisation issue, bonus issue and sub-division of share capital (i.e. the increase in number of shares per share upon capitalisation issue, bonus issue and sub-division of the share capital); Q represents the number of Share Options after adjustment.
(ii) Rights issue

Q = Q0 × P1 × (1 + n) ÷ (P1 + P2 × n)

Where: Q0 represents the number of Share Options prior to adjustment; P1 represents the closing price of shares on the record date; P2 represents the subscription price of the rights issue; n represents the ratio of the rights issue (i.e. the ratio of the number of shares to be issued under the rights issue to the total share capital of Seazen Holdings prior to the rights issue); Q represents the number of Share Options after adjustment.

(iii) Share consolidation

Q = Q0 × n

Where: Q0 represents the number of Share Options prior to adjustment; n represents the ratio of share consolidation (i.e. one share of Seazen Holdings shall be consolidated into n share); Q represents the number of Share Options after adjustment.

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(iv) Declaration of dividend and new issue of shares

In the event of declaration of dividend or new issue of shares, no adjustment shall be made to the number of Share Options.

2. Method for adjustment of the exercise price

In the event of any declaration of dividend, capitalisation issue, bonus issue, sub-division, rights issue or share consolidation of Seazen Holdings prior to any exercise of Share Options, the exercise price of Share Options shall be adjusted in the following manner accordingly:

(i) Capitalisation issue, bonus issue and sub-division of share capital

P = P0 ÷ (1 + n)

Where: P0 represents the exercise price of Share Options prior to adjustment; n represents the rate of increase per share resulting from capitalisation issue, bonus issue and sub-division of share capital; P represents the exercise price of Share Options after adjustment.
(ii) Rights issue

P = P0 × (P1 + P2 × n) ÷ [P1 × (1 + n)]

Where: P0 represents the exercise price of Share Options prior to adjustment; P1 represents the closing price of shares on the record date; P2 represents the subscription price of the rights issue; n represents the ratio of the rights issue (i.e. the ratio of the number of shares to be issued under the rights issue to the total share capital of Seazen Holdings prior to the rights issue); P represents the exercise price of Share Options after adjustment.

(iii) Share consolidation

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Where: P0 represents the exercise price of Share Options prior to adjustment; n represents the ratio of share consolidation; P represents the exercise price of Share Options after adjustment.

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(iv) Declaration of dividend

P = P0 - V

Where: P0 represents the exercise price of Share Options prior to adjustment; V represents the dividend per share; P represents the exercise price of Share Options after adjustment. After adjustment through declaration of dividend, P shall still be higher than 1.

(v) New issue of shares

In the event of new issue of shares by Seazen Holdings, no adjustment shall be made to the exercise price of Share Options.

3. Adjustment procedures for the Subsidiary Option Scheme

The Seazen Holdings Board shall pass a resolution for adjusting the number and the exercise price of Share Options upon occurrence of any of the abovementioned circumstances. Seazen Holdings shall engage a legal adviser to give professional advice to the Seazen Holdings Board on whether such adjustment is in compliance with the Administrative Measures, the articles of association of Seazen Holdings and the Subsidiary Share Incentive Scheme. After the resolution for the abovementioned adjustment is reviewed and passed by the Seazen Holdings Board, Seazen Holdings shall make disclosure by way of announcement on the resolution by the Seazen Holdings Board in a timely manner, and announce the opinions of the legal adviser.

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(B) Method and procedures for adjustment for the Subsidiary Restricted Incentive Scheme

1. Method for adjustment of the number of the Restricted Shares

In the event of any capitalisation issue, bonus issue, sub-division, rights issue or share consolidation of Seazen Holdings during the period from the date of Announcement to the completion of registration of Restricted Shares by the Participants, the number of Restricted Shares shall be adjusted in the following manner accordingly:

(i) Capitalisation issue, bonus issue and sub-division of share capital

Q = Q0 × (1 + n)

Where: Q0 represents the number of Restricted Shares prior to adjustment; n represents the rate of increase per share resulting from capitalisation issue, bonus issue and sub-division of share capital (i.e. the increase in number of shares per share upon capitalisation issue, bonus issue and sub-division of the share capital); Q represents the number of Restricted Shares after adjustment.
(ii) Rights issue

Q = Q0 × P1 × (1 + n) ÷ (P1 + P2 × n)

Where: Q0 represents the number of Restricted Shares prior to adjustment; P1 represents the closing price of shares on the record date; P2 represents the subscription price of the rights issue; n represents the ratio of the rights issue (i.e. the ratio of the number of shares to be issued under the rights issue to the total share capital of Seazen Holdings prior to the rights issue); Q represents the number of Restricted Shares after adjustment.

(iii) Share consolidation

Q = Q0 × n

Where: Q0 represents the number of Restricted Shares prior to adjustment; n represents the ratio of share consolidation (i.e. one share of Seazen Holdings shall be consolidated into n share); Q represents the number of Restricted Shares after adjustment.

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(iv) Declaration of dividend and new issue of shares

In the event of declaration of dividend or new issue of shares, no adjustment shall be made to the number of Restricted Shares.

2. Method for adjustment of the grant price

In the event of any declaration of dividend, capitalisation issue, bonus issue, sub-division, rights issue or share consolidation of Seazen Holdings during the period from the date of the Announcement to the completion of registration of Restricted Shares by the Participants, the grant price of Restricted Shares shall be adjusted in the following manner accordingly:

(i) Capitalisation issue, bonus issue and sub-division of share capital

P = P0 ÷ (1 + n)

Where: P0 represents the grant price of Restricted Shares prior to adjustment; n represents the rate of increase per share resulting from capitalisation issue, bonus issue and sub-division of share capital; P represents the grant price of Restricted Shares after adjustment.
(ii) Rights issue

P = P0 × (P1 + P2 × n) ÷ [P1 × (1 + n)]

Where: P0 represents the grant price of Restricted Shares prior to adjustment; P1 represents the closing price of shares on the record date; P2 represents the subscription price of the rights issue; n represents the ratio of the rights issue (i.e. the ratio of the number of shares to be issued under the rights issue to the total share capital of Seazen Holdings prior to the rights issue); P represents the grant price of Restricted Shares after adjustment.

(iii) Share consolidation

P = P0 ÷ n

Where: P0 represents the grant price of Restricted Shares prior to adjustment; n represents the ratio of share consolidation; P represents the grant price of Restricted Shares after adjustment.

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(iv) Declaration of dividend

P = P0 - V

Where: P0 represents the grant price of Restricted Shares prior to adjustment; V represents the dividend per share; P represents the grant price of Restricted Shares after adjustment. After adjustment through declaration of dividend, P shall still be higher than 1.

(v) New issue of shares

In the event of new issue of shares by Seazen Holdings, no adjustment shall be made to the grant price of Restricted Shares.

3. Adjustment procedures for the Subsidiary Restricted Incentive Scheme

The Seazen Holdings Board shall pass a resolution for adjusting the number and the grant price of Restricted Shares upon occurrence of any of the abovementioned circumstances. Seazen Holdings shall engage a legal adviser to give professional advice to the Seazen Holdings Board on whether such adjustment is in compliance with the Administrative Measures, the articles of association of Seazen Holdings and the Subsidiary Share Incentive Scheme. After the resolution for the abovementioned adjustment is reviewed and passed by the Seazen Holdings Board, Seazen Holdings shall make disclosure by way of announcement on the resolution by the Seazen Holdings Board in a timely manner, and announce the opinions of the legal adviser.

IX. IMPLEMENTATION PROCEDURES OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Procedures for the Subsidiary Share Incentive Scheme to take effect

The Seazen Holdings Board shall resolve on the Subsidiary Share Incentive Scheme in accordance with the law. When the Seazen Holdings Board considers the Subsidiary Share Incentive Scheme, the directors who are Participants or directors who has a related relationship with the Participants shall abstain from voting. The Seazen Holdings Board shall submit the Subsidiary Share Incentive Scheme to the general meeting for consideration after considering and approving the Subsidiary Share Incentive Scheme and performing the announcement procedures; at the same time, it will also be proposed at the general meeting to authorise the Seazen Holdings Board to be responsible for the implementation of the grant, exercise and cancellation of the Share Options and the grant, unlocking and repurchase of the Restricted Shares.

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The independent directors and the supervisory committee of Seazen Holdings shall express their opinions on whether the Subsidiary Share Incentive Scheme is beneficial to the sustainable development of Seazen Holdings and whether there is any noticeable damage to the interests of Seazen Holdings and all shareholders.
The implementation of the Subsidiary Share Incentive Scheme is subject to the consideration and approval at the general meeting of the Company and the general meeting of Seazen Holdings. Before convening the general meeting, Seazen Holdings shall internally announce the name and position of the Participants through Seazen Holdings’ website or other channels for a period of not less than 10 days. The supervisors committee shall verify the list of Participants and thoroughly consider opinions from the public. Seazen Holdings shall disclose the explanation of the supervisory committee on the review and publication of the list of the Participants 5 days before the Subsidiary Share Incentive Scheme is considered at the general meeting.
When voting on the Subsidiary Share Incentive Scheme at the general meeting of Seazen Holdings, independent directors of Seazen Holdings shall solicit proxy voting rights from all shareholders in respect of the Subsidiary Share Incentive Scheme. The general meeting shall vote on the contents of the Share Incentive Scheme as stipulated in Article 9 of the Administrative Measures, which shall be passed by more than two-thirds of the voting rights held by the shareholders present at the meeting, and separately count and disclose the voting of other shareholders other than the directors, supervisors, senior management of Seazen Holdings as well as shareholders individually or collectively holding more than 5% of Seazen Holdings’ shares.

When the Subsidiary Share Incentive Scheme is considered at Seazen Holdings’ general meeting, shareholders who are Participants or shareholders who have a related relationship with the Participants shall abstain from voting thereon.

When the Subsidiary Share Incentive Scheme is considered and approved at the general meeting of the Company and the general meeting of Seazen Holdings, and the conditions for the grant under the Subsidiary Share Incentive Scheme are satisfied, Seazen Holdings shall grant Share Options and Restricted Shares to the Participants within the prescribed time. Upon authorisation by the general meeting, the Seazen Holdings Board and the authorised parties are responsible for the implementation of the grant, exercise/unlocking and the cancellation/repurchase of the Share Options and Restricted Shares.

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(B) Procedures for grant of entitlements of the Subsidiary Share Incentive Scheme

Upon consideration and approval of the Subsidiary Share Incentive Scheme at the general meeting, Seazen Holdings and the Participants shall enter into the share incentive agreement to agree on the rights and obligations between the parties.
The Seazen Holdings Board shall consider and announce whether the conditions for the grant of the entitlements to the Participant as set out in the Subsidiary Share Incentive Scheme have been satisfied before Seazen Holdings makes a grant to such participants.

The independent directors and the supervisory committee of Seazen Holdings shall both express their views explicitly. The law firm shall issue legal opinions on whether the conditions for the grant of the entitlements to the Participants are satisfied or not.

The supervisory committee shall verify the Grant Dates of the Share Options and the Restricted Shares and the list of Participants and express opinions on such verification.
If there is any discrepancy between the grant of entitlements to the Participants and the arrangement of the Subsidiary Share Incentive Scheme, the independent directors, the supervisory committee of Seazen Holdings (in case of change of the Participants) and the law firm shall issue explicit opinions at the same time.
Upon consideration and approval of the Subsidiary Share Incentive Scheme at the general meeting of Seazen Holdings and the general meeting of the Company, Seazen Holdings shall grant the Participants within 60 days and complete the relevant procedures such as registration and announcement.
Seazen Holdings shall make an application to the stock exchange after the grant of entitlements, the securities registration and clearing institution shall handle the registration and clearing matters upon confirmation by such stock exchange.

(C) Procedures for exercise of the Share Options

Seazen Holdings shall confirm whether the Participants have satisfied the exercise conditions before the exercise date. The Seazen Holdings Board shall consider whether the Share Options held by the Participants have satisfied the exercise conditions, and the independent directors and the supervisory committee of Seazen Holdings shall express explicit opinions at the same time. The law firm shall issue legal opinions on whether the conditions for exercising the Share Options by the Participants are satisfied. For Participants who satisfy the exercise conditions, the

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Seazen Holdings Board may decide to exercise the Share Options at its discretion or to exercise the Share Options at the discretion of the Participants; for Participants who fail to satisfy the exercise conditions, Seazen Holdings shall cancel the Share Options corresponding to such exercise held by them. Seazen Holdings shall disclose the implementation thereof timely by way of announcement.

The Participants may transfer the shares upon exercise of the Share Options, but the transfer of the shares held by the directors and senior management of Seazen Holdings shall be in compliance with the requirements of relevant laws, regulations and regulatory documents.
Seazen Holdings shall make an application to the stock exchange before the Share Options are exercised by the Participants, and the registration and clearing company shall handle the registration and settlement matters upon confirmation by such stock exchange.
If the registered capital is designed to change upon the exercise of Share Options by the Participants, Seazen Holdings shall handle the registration procedures in relation to the changes of Seazen Holdings with the industry and commerce registration department.

(D) Procedures for unlocking of the Restricted Shares

Seazen Holdings shall confirm whether the Participants have satisfied the unlocking conditions before the unlocking date. The Seazen Holdings Board shall consider whether the conditions for unlocking the Restricted Shares under the Subsidiary Share Incentive Scheme have been satisfied, and the independent directors and the supervisory committee of Seazen Holdings shall express their explicit opinions at the same time. The law firm shall issue legal opinions on whether the conditions for unlocking the Restricted Shares have been satisfied. For Participants who satisfy the unlocking conditions, Seazen Holdings shall handle the unlocking matters at its discretion, and for Participants who fail to satisfy the unlocking conditions, Seazen Holdings shall repurchase the Restricted Shares corresponding to such unlocking held by them. Seazen Holdings shall disclose the implementation thereof timely by way of announcement.
The Participants may transfer the unlocked Restricted Shares, but the transfer of the shares held by the directors and senior management of Seazen Holdings shall be in compliance with the requirements of relevant laws, regulations and regulatory documents.
Seazen Holdings shall make an application to the stock exchange before the Restricted Shares of the Participants are unlocked, and the securities registration and clearing institution shall handle the registration and clearing matters upon confirmation by such stock exchange.

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(E) Procedures for amendment and termination of the Subsidiary Share Incentive Scheme

1. Procedures for amendment of the Subsidiary Share Incentive Scheme

(i) If Seazen Holdings intends to amend the Subsidiary Share Incentive Scheme before it is considered at the general meeting, such amendment shall be considered and approved by the Seazen Holdings Board.
(ii) If Seazen Holdings intends to amend the Subsidiary Share Incentive Scheme after it is considered and approved at the general meeting, such amendment shall be considered and approved at the general meeting and shall not result in the following:
① accelerating the exercise of Share Options/the unlocking of Restricted Shares;
② reducing the exercise price/grant price.

The independent directors and the supervisory committee of Seazen Holdings shall give independent opinions on whether the amended proposal is beneficial to the sustainable development of Seazen Holdings and whether there is any noticeable damage to the interests of Seazen Holdings and all shareholders. The law firm shall issue professional opinions on whether the amended proposal is in compliance with the Administrative Measures and the requirements of relevant laws and whether there is any noticeable damage to the interests of Seazen Holdings and all shareholders.

2. Procedures for termination of the Subsidiary Share Incentive Scheme

(i) If Seazen Holdings intends to terminate the implementation of the Subsidiary Share Incentive Scheme before it is considered at the general meeting, such termination shall be considered and approved by the Seazen Holdings Board.
(ii) If Seazen Holdings terminates the Subsidiary Share Incentive Scheme after it is considered and approved at the general meeting, such termination shall be considered and approved at the general meeting.

The law firm shall issue professional opinions on whether the termination of the Subsidiary Share Incentive Scheme by Seazen Holdings is in compliance with the Administrative Measures and the requirements of relevant laws and regulations and whether there is any noticeable damage to the interests of Seazen Holdings and all shareholders.

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X. RESPECTIVE RIGHTS AND OBLIGATIONS OF SEAZEN HOLDINGS AND THE PARTICIPANTS

(A) Rights and obligations of Seazen Holdings

Seazen Holdings shall have the right to interpretation and execute the Subsidiary Share Incentive Scheme and shall appraise the performance on the Participants based on the requirements under the Subsidiary Share Incentive Scheme. If the Participants fail to satisfy the conditions for exercising the Share Options or unlocking the Restricted Shares as determined under the Subsidiary Share Incentive Scheme, Seazen Holdings shall cancel the Share Options or repurchase the corresponding Restricted Shares of the Participants which have not been unlocked in accordance with the principles of the Subsidiary Share Incentive Scheme.
Seazen Holdings undertakes not to provide loans and financial support in any other forms, including providing guarantee for their loans, to the Participants in accordance with the Subsidiary Option Scheme and the Subsidiary Restricted Incentive Scheme.
Seazen Holdings shall discharge its obligations of reporting and information disclosure in relation to the Subsidiary Option Scheme and the Subsidiary Restricted Incentive Scheme in a timely manner in accordance with the relevant requirements.
Seazen Holdings shall, in accordance with the relevant requirements of the Subsidiary Option Scheme and the Subsidiary Restricted Incentive Scheme and the CSRC, the stock exchanges and securities registration and clearing institutions, actively cooperate with the Participants who have satisfied the conditions for exercising the Share Options or unlocking the Restricted Shares. However, Seazen Holdings shall not be liable for any loss caused to the Participants because of the failure of the Participants to exercise the Share Options or unlock the Restricted Shares at their own discretion due to reasons caused by the stock exchanges or securities registration and clearing institutions.
Seazen Holdings confirms that the eligibility of the Participants under the Subsidiary Share Incentive Scheme does not represent the right of such Participants to continue to serve Seazen Holdings and does not constitute a commitment of employment for a fixed term by Seazen Holdings. The employment relationship between Seazen Holdings and the Participants is still governed by the employment contract between the parties.

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(B) Rights and obligations of the Participants

A Participant shall comply with the requirements of his/her position as stipulated by Seazen Holdings, and shall work diligently and responsibly, strictly observe professional ethics, and make contribution to the development of Seazen Holdings.
The Participants shall lock up the Share Options and Restricted Shares granted to them in accordance with the provisions of the Subsidiary Share Incentive Scheme.
Source of funds for the Participants to participate in the Subsidiary Share Incentive Scheme shall be self-financed by the Participants.
The Share Options granted to the Participants shall be entitled to voting rights, the rights to dividends and rights to rights issue conferred by such shares upon exercise and the registration and transfer with the securities registration and clearing institution. The Share Options granted to the Participants under the Subsidiary Share Incentive Scheme shall not be transferred, used as guarantee or used for repayment of debts.

Upon registration and transfer by the securities registration and clearing institution, the Restricted Shares granted to the Participants shall have the same rights as shares, including but not limited to voting rights, the rights to dividends and rights to rights issue conferred by such shares. Before the Restricted Shares are unlocked, the Restricted Shares granted to the Participants under the Subsidiary Share Incentive Scheme shall not be transferred, used as guarantee or used for repayment of debts.

Any gains of the Participants generated from the Subsidiary Share Incentive Scheme shall be subject to individual income tax and other taxes in accordance with national tax regulations.
The Participants undertake, where false statements or misleading statements in or material omissions from the information disclosure documents of Seazen Holdings result in non-compliance with condition of grant or arrangements for exercise of the entitlements, the Participants concerned shall return to Seazen Holdings all interests gained through the Subsidiary Share Incentive Scheme calculated from the date when it is confirmed that the relevant information disclosure documents of Seazen Holdings contain false statements or misleading representations or material omissions.
Upon consideration and approval of the Subsidiary Share Incentive Scheme at the general meeting of Seazen Holdings, Seazen Holdings will sign an share incentive agreement with each Participant in order to define their respective rights and obligations under the Subsidiary Share Incentive Scheme and other relevant matters.
Other relevant rights and obligations under the laws, regulations and the Subsidiary Share Incentive Scheme.

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XI. HANDLING UNUSUAL CHANGES TO SEAZEN HOLDINGS AND THE PARTICIPANTS

(A) Handling unusual changes to Seazen Holdings

If any of the following circumstances occurs to Seazen Holdings, the Seazen Holdings Board shall be authorised by the general meeting to determine the continuation, amendment, suspension or termination of the Subsidiary Share Incentive Scheme in accordance with the degree of changes in relevant conditions, except for the rights explicitly required to be exercised by the general meeting in relevant documents:
(i) change in control of Seazen Holdings;
(ii) merger and spin-off of Seazen Holdings;
(iii) other material changes.
If any of the following circumstances occurs to Seazen Holdings, the Subsidiary Share Incentive Scheme shall be terminated and the Share Options granted to the Participants but not yet exercised shall not be exercised and shall be cancelled by Seazen Holdings; Restricted Shares granted but not yet unlocked shall not be unlocked and shall be repurchased by Seazen Holdings at the grant price plus interest on bank deposits for the same period:
(i) issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the financial report for the most recent accounting year;
(ii) issuance of an auditors’ report with adverse opinion or a certified public accountant indicates an inability to give opinion with respect to the internal control of the financial report for the most recent accounting year;
(iii) failure to conduct profit distribution in accordance with laws and regulations, the articles of association of Seazen Holdings and public undertakings during the 36 months after listing;
(iv) prohibition from implementation of share incentive scheme by laws and regulations;
(v) other circumstances under which the Subsidiary Share Incentive Scheme shall be terminated as determined by the CSRC.

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Where false statements or misleading statements in or material omissions from the information disclosure documents of Seazen Holdings result in non-compliance with the grant conditions or exercise/unlocking arrangements of the Share Options/Restricted Shares, the Share Options/Restricted Shares that have not been exercised/unlocked shall be cancelled/repurchased by Seazen Holdings. Where the Share Options/Restricted Shares granted to the Participants are exercised/unlocked, all the Participants shall return the granted entitlements to Seazen Holdings. Any Participant who is not liable for the above matters and who suffers losses as a result of the return of his/her entitlements may seek compensation from Seazen Holdings or the responsible party in accordance with the relevant arrangements under the Subsidiary Share Incentive Scheme. The Seazen Holdings Board shall recover the gains received by the Participants in accordance with the preceding paragraph and the relevant arrangements under the Subsidiary Share Incentive Scheme.
Other circumstances not specified above and their handling methods shall be determined by the Seazen Holdings Board.

(B) Handling of changes to personal conditions of the Participants

If any of the following circumstances occurs to a Participant, the Restricted Shares/Share Options granted to him/her shall not be changed and shall still be unlocked/exercised in accordance with the provisions under the Subsidiary Share Incentive Scheme:
(i) the Participant has a change in job position but is still within the scope of the Subsidiary Share Incentive Scheme, including employment in the holding subsidiary of Seazen Holdings and re-appointment after retirement;
(ii) other circumstances as determined by the remuneration and appraisal committee of the Seazen Holdings Board.
If any of the following circumstances occurs to a Participant, the Restricted Shares/Share Options granted to him/her shall not be changed, and the Seazen Holdings Board may determine that his/her personal performance appraisal conditions shall no longer be included as unlocking/exercise conditions:
(i) his/her resignation due to reaching the age of retirement stipulated by the State and Seazen Holdings;
(ii) resignation due to loss of working capacity;
(iii) in case of work-related death, the Share Options/Restricted Shares granted to him/her shall be held by his/her designated successor of property or legal successor on his/her behalf.

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In the event of non-work-related incapacity or non-work-related death of a Participant, the Seazen Holdings Board may determine that the Share Options granted to him/her but not yet exercised under the Subsidiary Share Incentive Scheme shall not continue to be exercised and shall be cancelled by Seazen Holdings; at the same time, the Restricted Shares granted under the Subsidiary Share Incentive Scheme but not yet unlocked shall not be unlocked and shall be repurchased by Seazen Holdings.
If any of the following circumstances occurs to a Participant, The Seazen Holdings Board may determine that his/her Share Options granted under the Subsidiary Share Incentive Scheme but not yet exercised shall not continue to be exercised and shall be cancelled by Seazen Holdings; at the same time, the Restricted Shares granted under the Subsidiary Share Incentive Scheme but not yet unlocked shall not be unlocked and shall be repurchased by Seazen Holdings. The Seazen Holdings Board may also determine that the Restricted Shares which have been approved of unlocking but have not been unlocked as a result of qualifying the appraisal of the Participants during the performance appraisal year can be retained, and Seazen Holdings will not repurchase such Restricted Shares:
(i) voluntary resignation;
(ii) the employment contract expires and is not renewed due to personal reasons.
In the event of change in job position or resignation due to incompetence in job duties, failure in appraisal, violation of laws, disclosure of confidential information of Seazen Holdings, negligence or malfeasance which seriously damage the interests or reputation of Seazen Holdings, the Seazen Holdings Board may determine that the Share Options granted to him/her under the Subsidiary Share Incentive Scheme but not yet exercised shall not continue to be exercised and shall be cancelled by Seazen Holdings; at the same time, the Restricted Shares granted under the Subsidiary Share Incentive Scheme but not yet unlocked shall not be unlocked and shall be repurchased by Seazen Holdings. If the circumstances are serious, the Seazen Holdings Board may, based on the actual situation, require the Participants to compensate Seazen Holdings for the losses incurred.
If any of the following circumstances occurs to a Participant, the Seazen Holdings Board may determine that the Share Options granted to him/her under the Subsidiary Share Incentive Scheme but not yet exercised shall not continue to be exercised and shall be cancelled by Seazen Holdings; at the same time, the Restricted Shares granted under the Subsidiary Share Incentive Scheme but not yet unlocked shall not be unlocked and shall be repurchased by Seazen Holdings.
(i) becoming an independent director, supervisor or other person who cannot hold A Shares of Seazen Holdings or other person who are not eligible to be a Participant;

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(ii) a person who is prohibited from acting as a director or a member of the senior management of Seazen Holdings under the Company Law;
(iii) he/she has been deemed as an inappropriate candidate by the stock exchange in the last 12 months;
(iv) he/she has been identified as an inappropriate candidate by the CSRC and its agencies in the last 12 months;
(v) having been imposed with administrative penalties or prohibited from entering into the market by the CSRC and its agencies in the last 12 months due to material non-compliance of laws and regulations;
(vi) prohibition from participation in share incentive schemes of listed companies by laws and regulations;
(vii) other circumstances as determined by the CSRC.
Other circumstances not stated above and their handling methods shall be determined by the remuneration and appraisal committee of the Seazen Holdings Board.

(C) Settlement of disputes between Seazen Holdings and the Participants

Any controversy or dispute arising out of or in connection with the implementation of the Subsidiary Share Incentive Scheme and/or the share incentive agreement entered into between Seazen Holdings and the Participants shall be settled by negotiation and communication or through mediation by the remuneration and appraisal committee of the Seazen Holdings Board. If both parties fail to settle such controversies or disputes by the above-mentioned methods within 60 days from the date of occurrence of such controversies or disputes, any party shall have the right to initiate legal proceedings in the People’s Court with jurisdiction over the location of Seazen Holdings.

XII. ACCOUNTING TREATMENT METHOD AND ESTIMATION OF IMPACT ON RESULTS

(A) Accounting treatment of Share Options

In accordance with the requirements of the Accounting Standards for Business Enterprises No. 11 – Share-based Payments, Seazen Holdings will, on each balance sheet date during the vesting period, revise the estimated number of Share Options that are exercisable based on the latest available subsequent information such as the change in the number of exercisable persons and the completion status of performance indicators, and include the services received in the current period into relevant costs or expenses and capital reserve based on the fair value of the Share Options on the Grant Date.

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

1. Calculation method of the value of the Share Options and the reasonableness of the parameters

The Ministry of Finance issued the Accounting Standards for Business Enterprises No. 11 – Share-based Payment and the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments on 15 February 2006, which were implemented within the scope of listed companies since 1 January 2007. According to relevant requirements regarding the determination of fair value in the Accounting Standards for Business Enterprises No. 22 – Recognition and Measurement of Financial Instruments, an appropriate valuation model shall be selected to calculate the fair value of the Share Options. Seazen Holdings selected the Black-Scholes model to calculate the fair value of the Share Options and calculated 14,515,000 Share Options under the initial grant on 27 September 2019.

(i) Target share price: RMB27.39 per share
(ii) Validity period: 2.40 years
(iii) Historical volatility: 38.41%
(iv) Risk-free interest rate: 2.76%
(v) Dividend yield: 0%

2. Amortisation method of Share Option expenses

In accordance with the relevant requirements of the Accounting Standards for Business Enterprises No. 11 – Share-based Payments, Seazen Holdings will, on each balance sheet date during the vesting period, revise the estimated number of Share Options that are exercisable based on the latest available subsequent information such as the change in the number of exercisable persons and the completion status of performance indicators, and include the services received in the current period into relevant costs or expenses and capital reserve based on the fair value of the Share Options on the Grant Date.

Assuming the initial grant of Share Options is made by Seazen Holdings in October 2019, the amortisation of the cost of Share Options from 2019 to 2022 is as follows:

Number of	Total expenses
Share Options	to be amortised	2019	2020	2021	2022
(0’000 shares)	(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)
1,451.50	10,320.17	1,118.02	6,020.10	2,322.04	860.01

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

Based on the preliminary estimation of the information currently available to Seazen Holdings, without taking into account the stimulation effects of the Subsidiary Share Incentive Scheme on the results of Seazen Holdings, the amortisation of share option expenses will have an insignificant impact on the net profit of each year during the validity period. If the positive impact of the Subsidiary Share Incentive Scheme on the development of Seazen Holdings are taken into consideration, such as motivating the management team, increasing operation efficiency, and reducing agent costs, the improvement in Seazen Holdings’ results brought by the Subsidiary Share Incentive Scheme shall far exceed the increase in the expenses incurred therefrom.

(B) Accounting treatment of the Restricted Shares

In accordance with the requirements of the Accounting Standards for Business Enterprises No. 11 – Share-based Payments, Seazen Holdings will, on each balance sheet date during the lock-up period, revise the number of Restricted Shares that are expected to be unlocked based on the latest available subsequent information such as the change in the number of persons subject to unlocking and the completion of performance indicators, and include the services received during the current period in relevant costs or expenses and capital reserve based on the fair value of the Restricted Shares on the Grant Date.

The unit cost of the Restricted Shares is represented by the fair value of the Restricted Shares less the grant price. For Participants who are not directors or senior management, the fair value of the Restricted Shares is represented by the closing price on the Grant Date. For directors and senior management, as the number of shares transferred by them each year during their term of office shall not exceed 25% of the total number of shares of Seazen Holdings held by them, they are subject to the restriction that the Restricted Shares shall be unlocked but shall not be transferred, which corresponds to certain restricted costs. Therefore, the fair value of Restricted Shares is represented by the closing price on the Grant Date less the unit cost of Restricted Shares transferred by directors and the senior management. Among which, the cost of transfer restriction for directors and senior management is calculated by the Black-Scholes model, the specific methods are as follows:

The restriction on the amount of transfer after unlocking of the equity instruments granted by the directors and senior management has brought corresponding transfer restriction costs to the Participants, i.e. the directors and senior management shall ensure that the costs required to be paid for selling the Restricted Shares shall not be lower than the closing price on the Grant Date in the future. Therefore, each of the directors and senior management shall purchase a put option on the Grant Date, and the number of exercise shall be the same as the amount of incentive granted to the directors and senior management, and the exercise period of which shall be the same as the weighted average lock-up period of the directors and senior management calculated based on the transfer restriction. As the maximum number of shares to be transferred by the directors and senior management each year is 25% of the shares held by them, a weighted average lock-up period of 4 years can be calculated. The purchase put option price of RMB6.42 was calculated using the Black-Scholes model as the unit transfer restriction cost for directors and senior management.

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SUMMARY OF PRINCIPAL TERMS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

APPENDIX

To summarise the above, the total fair value of the equity instruments granted by Seazen Holdings to the Participants based on the forecast on 27 September 2019 is RMB128,950,800, and such total fair value as the incentive cost of the Subsidiary Option Scheme of Seazen Holdings will be recognised in installments according to the unlocking proportion during the implementation of the Subsidiary Option Scheme.

Assuming the initial grant of Restricted Shares is made by Seazen Holdings in October 2019, the amortisation of the cost of Restricted Shares from 2019 to 2022 is as follows:

Number of	Total expense to
Restricted Shares	be amortised	2019	2020	2021	2022
(0’000 shares)	(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)
1,054.70	12,895.08	1,396.97	7,522.13	2,901.39	1,074.59

The following table sets forth the estimated total amortisation expense of Share Options and Restricted Shares:

Total expenses to be amortised	2019	2020	2021	2022
(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)	(RMB0’000)
23,215.24	2,514.98	13,542.23	5,223.43	1,934.60

Based on the preliminary estimation of the information currently available to Seazen Holdings, without taking into account the stimulation effects of the Subsidiary Share Incentive Scheme on the results of Seazen Holdings, the amortisation of the expenses of the Restricted Shares will have an insignificant impact on the net profit of each year during the validity period. If the positive effects of the Subsidiary Restricted Incentive Scheme on the development of Seazen Holdings are taken into account, such as motivating the management team, improving operation efficiency and reducing agent costs, the improvement in Seazen Holdings’ results brought by the Subsidiary Share Incentive Scheme shall far exceed the increase in the expenses incurred therefrom.

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NOTICE OF EGM

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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)

NOTICE OF THE EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT an extraordinary general meeting or any adjournment thereof (the “ Meeting ”) of Future Land Development Holdings Limited (the “ Company ”) will be held at 9:30 a.m. on Wednesday, 30 October 2019 at Unit 3703, 37/F, The Center, 99 Queen’s Road Central, Hong Kong for considering and, if thought fit, passing, with or without amendments, the following resolutions as special resolutions of the Company:

ORDINARY RESOLUTION

1. “ THAT

The Subsidiary Share Incentive Scheme of Seazen Holdings Co., Ltd. (新城控股集團股份有限公司) (as defined in the circular of the Company dated 8 October 2019), the terms of which are contained in the document marked “A” produced to the Meeting and for the purpose of identification signed by the chairman of the Meeting be and is hereby approved and adopted and that any director of the Company be and is hereby authorised to execute such documents and take such action as they deem appropriate to implement and give effect to the Subsidiary Share Incentive Scheme of Seazen Holdings Co., Ltd.”

SPECIAL RESOLUTIONS

2. “ THAT

(a) Subject to and conditional upon the approval of the Registrar of Companies in the Cayman Islands, the name of the Company be changed from “Future Land Development Holdings Limited 新城發展控股有限公司” to “Seazen Group Limited 新城發展控股有限公司”; and
(b) The directors of the Company be and are hereby authorised to do all such acts and things and execute all such documents and make all such arrangements as they shall, in their absolute discretion, deem necessary or expedient in connection with the implementation of or giving effect to the aforesaid change of English name of the Company.”

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NOTICE OF EGM

“ THAT
(a) Subject to and conditional upon resolution 2 being passed, and the new name of the Company being entered into the register of companies by the Registrar of Companies in Cayman Islands, the second amended and restated memorandum and articles of association of the Company be amended by replacing all references to “Future Land Development Holdings Limited 新城發展控股有限公司” with “Seazen Group Limited 新城發展控股有限公司” to reflect the change of English name of the Company; the second amended and restated memorandum and articles of association of the Company in the form produced to the Meeting, marked “B” and initiated by the chairman of the Meeting for the purpose of identification, be approved and adopted as the new memorandum and articles of association of the Company in substitution for and to the exclusion of the existing memorandum and articles of association of the Company; and
(b) The directors of the Company be and are hereby authorised to do all such acts and things and execute all such documents and make all such arrangements as they shall, in their absolute discretion, deem necessary or expedient in connection with the implementation of or giving effect to the aforesaid adoption of the second amended and restated memorandum and articles of association of the Company.”

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

The PRC, 8 October 2019

Registered office: Principal place of business Grand Pavilion in Hong Kong: Hibiscus Way 31/F, Tower Two 802 West Bay Road Times Square P.O. Box 31119 1 Matheson Street KY1-1205 Causeway Bay, Hong Kong Cayman Islands

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NOTICE OF EGM

Notes:

(i) A shareholder entitled to attend and vote at the Meeting is entitled to appoint another person as his/her proxy to attend and vote instead of him/her; a proxy need not be a shareholder of the Company. A shareholder who is the holder of two or more shares may appoint more than one proxy to represent him/her and vote on his/her behalf at the Meeting. On a poll, votes may be given either personally or by proxy.
(ii) In the case of joint holders, any one of such joint holders may vote at the Meeting, either in person or by proxy, in respect of such share as if he/she were solely entitled thereto, but if more than one of such joint holders are present at the Meeting, the vote of the senior who tenders a vote, whether in person or by proxy, will be accepted to the exclusion of the vote(s) of the other joint holder(s) and for this purpose seniority shall be determined as that one of the said persons so present whose name stands first on the register of members of the Company in respect of such share shall alone be entitled to vote in respect thereof.
(iii) In order to be valid, a form of proxy must be deposited at the Hong Kong branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong together with the power of attorney or other authority (if any) under which it is signed (or a notarially certified copy thereof) not less than 48 hours before the time appointed for the holding of the above meeting (i.e. before 9:30 a.m. on 28 October 2019) or any adjournment thereof. The completion and return of the form of proxy shall not preclude shareholders of the Company from attending and voting in person at the above meeting (or any adjourned meeting thereof) if they so wish.
(iv) The transfer books and register of members of the Company will be closed from Friday, 25 October 2019 to Wednesday, 30 October 2019, both days inclusive, during which period no share transfers can be registered. In order to qualify for attending the Meeting, all transfers accompanied by the relevant share certificates must be lodged with the Hong Kong branch share registrar and transfer office of the Company, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong not later than 4:30 p.m. on Thursday, 24 October 2019.
for identification purpose only

– 54 –

AI assistant

Seazen Group Limited — Proxy Solicitation & Information Statement 2019

49637_rns_2019-10-08_12ee6e29-25d3-4765-aacb-0cbd80345d03.pdf

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME, PROPOSED CHANGE OF ENGLISH COMPANY NAME, PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION AND NOTICE OF EXTRAORDINARY GENERAL MEETING

TABLE OF CONTENTS

DEFINITIONS

DEFINITIONS

DEFINITIONS

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

(Stock Code: 1030)

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME, PROPOSED CHANGE OF ENGLISH COMPANY NAME, PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION AND NOTICE OF EXTRAORDINARY GENERAL MEETING

INTRODUCTION

PROPOSED ADOPTION AND INITIAL GRANT OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

General Information on the Subsidiary Share Incentive Scheme

PROPOSED CHANGE OF ENGLISH COMPANY NAME

Conditions of the proposed Change of English Company Name

Reasons for the proposed Change of English Company Name

Effect of the proposed Change of English Company Name

PROPOSED ADOPTION OF THE SECOND AMENDED AND RESTATED MEMORANDUM AND ARTICLES OF ASSOCIATION

NOTICE OF EXTRAORDINARY GENERAL MEETING

FORM OF PROXY

VOTING BY POLL

RESPONSIBILITY STATEMENT

RECOMMENDATION

Future Land Development Holdings Limited

I. PURPOSE OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

II. METHOD OF THE SUBSIDIARY SHARE INCENTIVE SCHEME AND SOURCE OF THE UNDERLYING SHARES

III. THE NUMBER OF SHARE OPTIONS AND RESTRICTED SHARES TO BE GRANTED UNDER THE SUBSIDIARY SHARE INCENTIVE SCHEME

IV. SCOPE AND ALLOCATION OF THE PARTICIPANTS OF THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Basis for determining the Participants

1. Legal basis for determining the Participants

2. Position basis for determining the Participants

(B) Scope of the Participants

(C) Circumstances for disqualification of the Participants

(D) Verification of the Participants

(E) Allocation of the Share Options and Restricted Shares granted to the Participants

V. EXERCISE PRICE OF THE SHARE OPTIONS AND GRANT PRICE OF THE RESTRICTED SHARES AND THE BASIS FOR DETERMINATION

(A) Exercise price of the Share Options

1. Exercise price of the Share Options under the initial grant

3. Basis for determination of exercise price of the Share Options under the reserved grant

(B) Grant price of the Restricted Shares

VI. EXERCISE SCHEDULE FOR THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Exercise schedule for the Share Options

1. Validity period of the Subsidiary Option Scheme

2. Grant Date

3. Vesting period

4. Exercise date

5. Lock-up period

(B) Schedule for the Restricted Shares

1. Validity period of the Subsidiary Restricted Incentive Scheme

2. Grant Date

3. Restricted period

4. Unlocking arrangement

5. Lock-up period

VII. CONDITIONS OF GRANT OF SHARE OPTIONS/RESTRICTED SHARES AND CONDITIONS OF EXERCISE/UNLOCKING

(A) Conditions of grant and exercise of Share Options

1. Conditions of grant of the Share Options

2. Conditions of exercise of the Share Options

(i) Appraisal requirements on Seazen Holdings’ performance

Exercise period

Performance appraisal target

Exercise period

Performance appraisal target

Exercise period Performance appraisal target

(B) Conditions of grant and unlocking of Restricted Shares

1. Conditions of grant of Restricted Shares

2. Conditions of unlocking of Restricted Shares

(i) Seazen Holdings’ performance appraisal requirements

Unlocking

arrangement

Performance appraisal target

Unlocking

arrangement Performance appraisal target

(ii) Individual performance appraisal requirements

(C) Scientificity and reasonableness of the appraisal indicators

VIII. METHOD AND PROCEDURES FOR ADJUSTMENT TO THE NUMBER AND PRICE OF ENTITLEMENT UNDER THE SUBSIDIARY SHARE INCENTIVE SCHEME

(A) Method and procedures for adjustment for the Subsidiary Option Scheme

1. Method for adjustment of the number of the Share Options

Seazen Group Limited Proxy Solicitation & Information Statement 2019