China Overseas Land & Investment : CONTINUING CONNECTED TRANSACTIONS WITH CHINA STATE CONSTRUCTION INTERNATIONAL HOLDINGS LIMITED IN RELATION TO SUPPLY OF MATERIALS

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

(incorporated in Hong Kong with limited liability)

(Stock Code: 688)

CONTINUING CONNECTED TRANSACTIONS

WITH CHINA STATE CONSTRUCTION INTERNATIONAL HOLDINGS LIMITED

IN RELATION TO SUPPLY OF MATERIALS

The Board is pleased to announce that on 28 April 2021, the Company and CSC entered into the Framework Agreement, pursuant to which (i) the Group may supply the Materials for the Projects upon the request of each of the CSC Group and the Minority Controlled Group in accordance with the tendering procedures of the CSC Group or the Minority Controlled Group (as the case may be) from time to time for a term of three years commencing from 1 July 2021 and ending on 30 June 2024 (both dates inclusive) subject to the Caps; and (ii) the CSC Group or the Minority Controlled Group (as the case may be) may engage the Group as supplier of the Materials for the Projects upon the Group's successful tender.

As at the date of this announcement, COHL is a controlling shareholder of both the Company and CSC by virtue of it being interested in approximately 56.05% of the issued share capital of the Company and approximately 64.79% of the issued share capital of CSC respectively. Accordingly, members of the CSC Group and the Minority Controlled Group are connected persons of the Company. The transactions contemplated under the Framework Agreement constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

Reference is made to the announcement of the Company dated 15 December 2020 in relation to, among other things, the Huizhi Building Agreement which constituted a connected transaction of the Company. Pursuant to Rule 14A.81 of the Listing Rules, the transactions contemplated under the Framework Agreement shall be aggregated with the transactions contemplated under the Huizhi Building Agreement as they are of similar nature and were all entered into within a 12-month period by the Group with parties who are connected with one another.

Since one or more of the applicable percentage ratios of the aggregate amount of the highest Cap in respect of the Framework Agreement and the Contract Sum in respect of the Huizhi Building Agreement exceed 0.1% but are less than 5%, the transactions contemplated under the Framework Agreement are subject to annual review, reporting and announcement requirements but are exempt from the independent shareholders' approval requirement pursuant to Chapter 14A of the Listing Rules.

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CONTINUING CONNECTED TRANSACTIONS

The Board is pleased to announce that on 28 April 2021, the Company and CSC entered into the Framework Agreement, pursuant to which (i) the Group may supply the Materials for the Projects upon the request of each of the CSC Group and the Minority Controlled Group in accordance with the tendering procedures of the CSC Group or the Minority Controlled Group (as the case may be) from time to time for a term of three years commencing from 1 July 2021 and ending on 30 June 2024 (both dates inclusive) subject to the Caps; and (ii) the CSC Group or the Minority Controlled Group (as the case may be) may engage the Group as supplier of the Materials for the Projects upon the Group's successful tender.

THE FRAMEWORK AGREEMENT

Date

28 April 2021

Parties

1. The Company; and
2. CSC.

Subject Matter

The Framework Agreement will commence from 1 July 2021 and end on 30 June 2024 (both dates inclusive) whereby the parties agreed that:

1. Each of the CSC Group and the Minority Controlled Group may invite the Group to participate in competitive tender for the supply of the Materials for the Projects as supplier of the CSC Group or the Minority Controlled Group (as the case may be) from time to time. The Group may tender for the supply of the Materials for the Projects in accordance with the tendering procedures of the CSC Group or the Minority Controlled Group (as the case may be) and on the same and normal terms as offered to other independent third party suppliers of the CSC Group or the Minority Controlled Group (as the case may be);
2. if any contract is awarded to the Group as a result of the above tender, the Group may act as supplier of the CSC Group or the Minority Controlled Group (as the case may be) for the supply of the Materials for the Projects based on the terms of the tender proposal accepted provided that the maximum total contract sum in respect of the supply of the Materials for the Projects that may be awarded to the Group shall not exceed the following Caps:

For the period	For the year	For the year	For the period
from	ending	ending	from
1 July 2021	31 December 2022	31 December 2023	1 January 2024
to 31 December			to 30 June 2024
2021
RMB150 million	RMB360 million	RMB430 million	RMB260 million
(approximately	(approximately	(approximately	(approximately
HK$176 million)	HK$424 million)	HK$506 million)	HK$306 million)
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1. the contract amount in respect of the supply of the Materials for the Projects payable to the Group will be settled pursuant to the payment terms set out in the specific contracts.

Basis of Determining the Prices

As a general principle, the prices and terms of the contracts shall be determined in the ordinary course of business and on normal commercial terms, negotiated on an arm's length basis and at prices and on terms no less favourable to the Group than those provided to the independent third party customers of the Group.

The Group will normally need to go through a tender or similar process before being selected and engaged by the CSC Group or the Minority Controlled Group (as the case may be) for the supply of the Materials for the Projects. The prices and terms of the tender proposals submitted by the Group to the CSC Group and the Minority Controlled Group for the supply of the Materials for the Projects are subject to the standard and systematic tender submission procedures of the Group, which apply to tender proposals submitted to both connected persons and independent third parties, in order to ensure that the prices and terms of the tender proposals submitted by the Group to the CSC Group and the Minority Controlled Group are no less favourable to the Group than those submitted to independent third parties.

The standard and systematic tender submission procedures generally involve (i) receiving invitation to tender; (ii) initial assessment of tender document; (iii) estimation of the costs and determination of profit margin; (iv) preparation of tender report for internal adjudication; and

1. submission of tender proposal. The procedures, as illustrated in the following diagram, will enable the Group to review the profitability of a prospective tender and decide the delivery arrangements and pricing terms of the tender proposal for submission.

				Receiving invitation to tender
				Initial assessment of tender document
Quantitative comparison between
in-house cost information and				Estimation of the costs and
preliminary quotations from suppliers				determination of profit margin
for cost estimation
				Preparation of tender report for internal adjudication
				Submission of tender proposal

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After receiving a tender document, the Group will conduct an initial assessment of the tender document on the technical requirements, quantity specifications and expected completion time of the project, customer's expectations and possible risks associated with the project. The Group will then conduct quantitative costs analysis and risk assessment.

In determining the pricing terms and profit margin, the Group will take into account, among other things, the costs of the Materials (with reference to the cost information maintained in its in-house computer database) and related expenses to be incurred by the Group (e.g. labour costs, costs for quality assurance, delivery costs etc.), quantity required by the CSC Group or the Minority Controlled Group (as the case may be), and the prices of those Materials in open market. The Group will also take into account the contract value of the previous winning bids and the chance of winning a bid. The Group will review and compare the prices of previous tender proposals submitted to both connected persons and independent third parties, so as to ensure that the tender price is no less favourable to the Group than those offered to independent third parties. The Group will then prepare a tender report containing the price and major terms of the tender proposal for adjudication by its tender board. The tender board will then meet to deliberate and after the tender price and terms have been approved by the tender board, the Group will submit the tender proposal to the tenderee.

If any contract is awarded to the Group as a result of the competitive tender, the CSC Group or the Minority Controlled Group will issue a letter of award to the Group and the Group will act as supplier of the CSC Group or the Minority Controlled Group (as the case may be) for the supply of the Materials for the Projects based on the terms of the tender proposal accepted by the CSC Group or the Minority Controlled Group (as the case may be). Upon delivery of the Materials, the CSC Group or the Minority Controlled Group (as the case may be) shall conduct final check and inspection on the Materials ordered and provide the relevant written acceptance to the Group afterwards.

Calculation of the Caps

The Cap is determined with reference to (i) the estimated total contract sum for the supply of the Materials for the Projects that the CSC Group or the Minority Controlled Group may invite the Group to participate in competitive tenders, taking into account the number and size of the potential new Projects; (ii) the historical transaction amount in relation to the supply of the Materials payable by the CSC Group to the Group, being the Contract Sum under the Huizhi Building Agreement of RMB12,000,000.00 (approximately HK$14,117,647.06); (iii) the scale and scope of the works, fees, costs and the price of the Materials charged by the independent third parties suppliers for previous projects of similar nature; and (iv) other factors such as the prevailing market prices and expected annual inflation of 4% of the Materials in the years 2021 to 2024.

REASONS FOR AND BENEFITS OF ENTERING INTO THE FRAMEWORK AGREEMENT

The Group has consolidated all of its procurement and sourcing businesses under Shenzhen Lingchao. Shenzhen Lingchao is a company committed to becoming the largest B2B trading platform in the construction materials industry, and actively exploring its business for Shenzhen Lingchao's long-term development, including actively expanding and strengthening business cooperation with the CSC Group, providing the CSC Group with construction and renovation materials in good quality and more favourable price under an open and a transparent tendering procedures. The Company believes that being able to supply the Materials for the Projects upon successful tender would facilitate the cooperation of the parties.

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None of the Directors has any material interest in the transactions contemplated under the Framework Agreement and no Director is required to abstain from voting on such Board resolutions. However, Mr. Yan Jianguo, being the Chairman and Executive Director of the Company, the chairman and president of COHL, the chairman and non-executive director of CSC, has voluntarily abstained from voting on the Board resolutions approving the entering into of the Framework Agreement and the transactions contemplated thereunder.

The Directors (including the Independent Non-executive Directors) consider that the transactions contemplated under the Framework Agreement are expected to be entered into in the ordinary and usual course of business of the Group and on normal commercial terms after arm's length negotiations between the parties, the Framework Agreement (together with the Caps) has been entered into on normal commercial terms after arm's length negotiations between the parties, and the terms of the transactions contemplated under the Framework Agreement (together with the Caps) are fair and reasonable and in the interests of the Company and its shareholders as a whole.

LISTING RULES IMPLICATIONS

As at the date of this announcement, COHL is a controlling shareholder of both the Company and CSC by virtue of it being interested in approximately 56.05% of the issued share capital of the Company and approximately 64.79% of the issued share capital of CSC respectively. Accordingly, members of the CSC Group and the Minority Controlled Group are connected persons of the Company. The transactions contemplated under the Framework Agreement constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

Reference is made to the announcement of the Company dated 15 December 2020 in relation to, among other things, the Huizhi Building Agreement which constituted a connected transaction of the Company. Pursuant to Rule 14A.81 of the Listing Rules, the transactions contemplated under the Framework Agreement shall be aggregated with the transactions contemplated under the Huizhi Building Agreement as they are of similar nature and were all entered into within a 12-month period by the Group with parties who are connected with one another.

Since one or more of the applicable percentage ratios of the aggregate amount of the highest Cap in respect of the Framework Agreement and the Contract Sum in respect of the Huizhi Building Agreement exceed 0.1% but are less than 5%, the transactions contemplated under the Framework Agreement are subject to annual review, reporting and announcement requirements but are exempt from the independent shareholders' approval requirement pursuant to Chapter 14A of the Listing Rules.

Shareholders should note that the Caps represent the best estimates by the Directors of the amount of the relevant transactions based on the information currently available. The Caps bear no direct relationships to, nor should be taken to have any direct bearings to, the financial or potential financial performance of the Group.

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INFORMATION ON THE PARTIES

The Group is principally engaged in property development and investment, and other operations. Shenzhen Lingchao is a wholly-owned subsidiary of the Company and is principally engaged in supply chain management services, sale of machineries, equipment, construction materials and building decoration materials, etc.

The CSC Group is principally engaged in construction business, infrastructure investments and prefabricated constructions.

CSCECL is the holding company of COHL, which in turn is the controlling shareholder of both the Company and CSC. CSCECL is a contractor which is principally engaged in construction works in various cities in the PRC and various countries around the world.

CSCEC is the ultimate holding company of each of CSCECL, COHL, the Company and CSC. CSCEC, together with its subsidiaries (excluding those listed on any stock exchange), is a conglomerate principally engaged in building construction, international contracting, real estate development and investment, infrastructure construction and investment and design and prospecting.

DEFINITIONS

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

"connected person(s)",	each has the meaning ascribed to it in the Listing Rules;
"controlling shareholder(s)",
"percentage ratio(s)" and
"subsidiary(ies)"
"Board"	the board of Directors;
"Cap(s)"	the maximum total contract sum that may be awarded by
	the CSC Group and the Minority Controlled Group to the
	Group for the supply of the Materials for the Projects for a
	term of three years from 1 July 2021 to 30 June 2024 (both
	dates inclusive) under the Framework Agreement;
"COHL"	China Overseas Holdings Limited, a company
	incorporated in Hong Kong with limited liability, which is
	a wholly-owned subsidiary of CSCECL and the controlling
	shareholder of the Company and CSC;
"Company"	China Overseas Land & Investment Limited, a company
	incorporated in Hong Kong with limited liability and
	whose shares are listed on the Main Board of the Stock
	Exchange (stock code: 688);
"Contract Sum"	the contract sum of the Huizhi Building Agreement as
	disclosed in the Company's announcement dated 15
	December 2020;
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"CSC"	China State Construction International Holdings Limited,
	a company incorporated in the Cayman Islands with
	limited liability and whose shares are listed on the Main
	Board of the Stock Exchange (stock code: 3311);
"CSC Group"	CSC and its subsidiaries (excluding subsidiary(ies) listed
	on any stock exchange and their respective subsidiary(ies),
	if any) from time to time;
"CSCEC"	中 國 建 築 集 團 有 限 公 司 (China State Construction
	Engineering Corporation*), a state-owned corporation
	organised and existing under the laws of the PRC, being
	the ultimate holding company of each of CSCECL, COHL,
	the Company and CSC;
"CSCECL"	China State Construction Engineering Corporation
	Limited, a joint stock company established in the PRC
	whose shares are listed on the Shanghai Stock Exchange
	(stock code: 601668), is a non-wholly owned subsidiary of
	CSCEC and the holding company of COHL;
"Director(s)"	director(s) of the Company;
"Framework Agreement"	the framework agreement entered into between the
	Company and CSC on 28 April 2021 in respect of the
	supply of the Materials for the Projects by the Group to the
	CSC Group or the Minority Controlled Group (as the case
	may be) from time to time for a term of three years
	commencing from 1 July 2021 and ending on 30 June 2024
	(both dates inclusive);
"Group"	the Company and its subsidiaries (excluding
	subsidiary(ies) listed on any stock exchange and their
	respective subsidiary(ies), if any) from time to time;
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong;
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC;
"Huizhi Building Agreement"	the supply chain management agreement dated 15
	December 2020 entered into between Shenzhen Lingchao
	and 深圳市海清置業發展有限公司(Shenzhen Haiqing
	Properties Development Co., Ltd.*) (a company
	established in the PRC with limited liability and is owned
	as to 50% by a wholly-owned subsidiary of the Company
	and 50% by a wholly-owned subsidiary of CSC) as defined
	in the Company's announcement dated 15 December 2020;
"Listing Rules"	The Rules Governing the Listing of Securities on the Stock
	Exchange;
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"Mainland China" or	the People's Republic of China, and for the purpose of this
"PRC"	announcement, excluding Hong Kong, the Macao Special
	Administrative Region of the PRC and Taiwan;
"Materials"	civil-works, electromechanical and renovation items,
	goods or materials;
"Minority Controlled Group"	the companies held as to 30% to 50% by the CSC Group,
	and their respective subsidiaries from time to time
	(excluding members of the Group and members of the CSC
	Group, respectively);
"Projects"	construction project(s) of the CSC Group and the Minority
	Controlled Group in Mainland China;
"RMB"	Renminbi, the lawful currency of the PRC;
"Shareholder(s)"	the shareholder(s) of the Company from time to time;
"Shenzhen Lingchao"	深 圳 領 潮 供 應鏈 管 理有 限 公 司 (Shenzhen Lingchao
	Supply Chain Management Co., Ltd.*), a company
	established in the PRC with limited liability and a wholly-
	owned subsidiary of the Company;
"Stock Exchange"	The Stock Exchange of Hong Kong Limited; and
"%"	per cent.

* English translation for identification purpose only

Unless otherwise specified in this announcement, amounts denominated in Renminbi have been converted, into Hong Kong dollars at the rate of RMB0.85 = HK$1.00. The exchange rate is for the purpose of illustration only and does not constitute a representation that any amount has been, could have been or may be converted at the above rate or any other rates.

By Order of the Board

China Overseas Land & Investment Limited

Yan Jianguo

Chairman and Executive Director

Hong Kong, 28 April 2021

As at the date of this announcement, Mr. Yan Jianguo (Chairman), Mr. Luo Liang (Vice Chairman), Mr. Zhang Zhichao (Chief Executive Officer) and Mr. Guo Guanghui are the Executive Directors of the Company; Mr. Zhuang Yong (Vice Chairman) and Mr. Chang Ying are the Non-executive Directors of the Company; and Dr. Fan Hsu Lai Tai, Rita, Mr. Li Man Bun, Brian David and Professor Chan Ka Keung, Ceajer are the Independent Non-executive Directors of the Company.

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