Shanghai Fosun Pharmaceutical : CONNECTED TRANSACTIONS ENTERING INTO EQUITY TRANSFER AND LOAN ASSIGNMENT CONTRACT

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上 海 復 星 醫 藥（集 團）股 份 有 限 公 司

Shanghai Fosun Pharmaceutical (Group) Co., Ltd.*

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 02196)

CONNECTED TRANSACTIONS

ENTERING INTO EQUITY TRANSFER AND LOAN ASSIGNMENT CONTRACT

TRANSFER CONTRACT

The Board announces that on 26 April 2021, Chancheng Hospital, Fosun Healthcare and Foshan Chanxi, subsidiaries of the Company, entered into the Transfer Contract with Yuyuan, pursuant to which Chancheng Hospital and Fosun Healthcare agreed to transfer the Sale Interest to Yuyuan at a total consideration of RMB176.1128 million, and assign the Sale Loan to Yuyuan at a total consideration of RMB373.8872 million. Upon completion of the Disposal, Yuyuan (or its designated subsidiaries as agreed) will hold 100% equity interest in Foshan Chanxi, and Foshan Chanxi will cease to be a subsidiary of the Company.

HONG KONG LISTING RULES IMPLICATIONS

As Yuyuan is a subsidiary of Fosun International, the controlling shareholder of the Company, therefore, Yuyuan constitutes a connected person of the Company under Chapter 14A of the Hong Kong Listing Rules. Accordingly, the transactions contemplated under the Transfer Contract constitute connected transactions of the Company under Chapter 14A of the Hong Kong Listing Rules.

Given that the relevant parties to the Transfer Contract and to the Previous Connected Transactions are the same connected persons, the transactions contemplated under the Transfer Contract and the Previous Connected Transactions shall be aggregated pursuant to Rule 14A.81 of the Hong Kong Listing Rules. As the relevant percentage ratios applicable to the sum of the transactions contemplated under the Transfer Contract and the Previous Connected Transactions are more than 0.1% but less than 5%, the transactions contemplated under the Transfer Contract are subject to reporting and announcement requirements but are exempted from the independent shareholders' approval requirement under Chapter 14A of the Hong Kong Listing Rules.

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However, the transactions contemplated under the Transfer Contract are subject to the approval of the Shareholders in accordance with the relevant laws and regulations of the PRC. The Company proposes to convene a general meeting to seek the approval of the Shareholders in relation to transactions contemplated under the Transfer Contract. A circular containing details of the Transfer Contract will be dispatched to the Shareholders.

1. TRANSFER CONTRACT
   The Board announces that on 26 April 2021, Chancheng Hospital, Fosun Healthcare and Foshan Chanxi, subsidiaries of the Company, entered into the Transfer Contract with Yuyuan, pursuant to which Chancheng Hospital and Fosun Healthcare agreed to transfer the Sales Interest to Yuyuan at a consideration of RMB176.1128 million, and assign the Sale Loan to Yuyuan at a total consideration of RMB373.8872 million. Upon completion of the Disposal, Yuyuan (or its designated subsidiaries as agreed) will hold 100% equity interest in Foshan Chanxi, and Foshan Chanxi will cease to be a subsidiary of the Company.
   The principal terms of the Transfer Contract are summarised below:
2. 1. Date
      26 April 2021
   2. Parties
   3. 1. Chancheng Hospital, as the vendor;
      2. Fosun Healthcare, as the vendor;
      3. Foshan Chanxi, as the target company; and
      4. Yuyuan, as the purchaser
   4. Assets to be disposed of
      Pursuant to the Transfer Contract, Chancheng Hospital and Fosun Healthcare agreed to sell, and Yuyuan agreed to purchase, the Sale Interest and the Sale Loan.

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1. Consideration
   Pursuant to the Transfer Contract, the total consideration for the Sale Interest is RMB176.1128 million, of which the consideration for Chancheng Hospital Sale Interest is RMB105.6677 million, and the consideration for Fosun Healthcare Sale Interest is RMB70.4451 million. The total consideration for the Sale Loan is RMB373.8872 million, of which the consideration for Chancheng Hospital Sale Loan is RMB305.2104 million, and the consideration for Fosun Healthcare Sale Loan is RMB68.6768 million.
   The consideration was determined between the parties after arm's-length negotiation based on the appraisal value as set out in the asset valuation report issued by China Faith Appraisers Co., Ltd.*, of which the appraisal value of the Sale Interest was in the amount of RMB176.7879 million and the appraisal value of the Sale Loan was in the amount of RMB373.8872 million as at 31 December 2020, being the valuation benchmark date.
2. Payment schedule
   The consideration for the Disposal will be paid by Yuyuan with its internal resources or its self- raised funds.
   Pursuant to the Transfer Contract, the consideration shall be paid by Yuyuan to Chancheng Hospital and Fosun Healthcare in the following manner:
3. 1. Within 10 business days of the effective date of the Transfer Contract, Yuyuan shall pay the consideration for Chancheng Hospital Sale Interest of RMB105.6677 million to Chancheng Hospital, and the consideration for Fosun Healthcare Sale Interest of RMB70.4451 million to Fosun Healthcare;
   2. Within 10 business days of the effective date of the Transfer Contract, Yuyuan shall pay the first instalment of the consideration for Chancheng Hospital Sale Loan of RMB59.3323 million to Chancheng Hospital, and the second instalment in the amount of RMB245.8781 million shall be payable to Chancheng Hospital by 30 October 2021; and
   3. Within 10 business days of the effective date of the Transfer Contract, Yuyuan shall pay the first instalment of the consideration for Fosun Healthcare Sale Loan of RMB39.5549 million to Fosun Healthcare, and the second instalment in the amount of RMB29.1219 million shall be payable to Fosun Healthcare by 30 October 2021.

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1. Effectiveness
   The Transfer Contract shall be concluded upon the signing and affixed with common seal by all parties thereto, and shall be effective upon the satisfaction of all the following conditions:
2. 1. the relevant resolutions of the shareholders of Chancheng Hospital approving the Disposal having been passed;
   2. the relevant resolutions of the shareholders of Fosun Healthcare approving the Disposal having been passed;
   3. the relevant resolutions of the Shareholders approving the Disposal having been passed;
   4. the relevant resolutions of the shareholders of Yuyuan approving the Disposal having been passed;
   5. the relevant resolutions of the shareholders of Foshan Chanxi approving the Disposal having been passed, and the respective right of first refusal of Chancheng Hospital and Fosun Healthcare having been waived.
3. Completion
   Within 7 business days upon fulfillment of all the following conditions, Chancheng Hospital and Fosun Helathcare shall be responsible for the transfer of title of the Sale Interest under the name of Yuyuan (subject to the date of the new business license of Foshan Chanxi after the transfer):
4. 1. Chancheng Hospital and Fosun Healthcare having received the consideration for Sale Interest paid by Yuyuan;
   2. Chancheng Hospital and Fosun Healthcare having received the first instalment of consideration for Sale Loan paid by Yuyuan; and
   3. The Guarantee provided by Chancheng Hospital having discharged by Foshan Bank on or before the Closing Date.

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8. Continued performance of the Customization Agreement

Pursuant to the Transfer Contract, the parties agree that, Chancheng Hospital and Foshan Chanxi will continue to perform the Customization Agreement dated 6 January 2020, pursuant to which Foshan Chanxi will carry out the development and construction of the Customized Project in accordance with customized requirements of Chancheng Hospital for the Customized Project, and deliver the Customized Project to Chancheng Hospital by 30 September 2022 or such other time as agreed by both parties upon completing the filing in respect of completion inspection of the Customized Project, and the title of the Customized Project will be registered under the name of Chancheng Hospital by way of asset transfer. The customization price for the Customized Project, which will be determined based on the pricing terms as set out in paragraph headed "Customization price for the development and construction of Customized Project" below together with the customization service fee at the rate of not more than 2.5% of the Appraisal Amount (as defined below), shall be payable by Chancheng Hospital to Foshan Chanxi, in accordance with the terms of the Transfer Contract and the Customization Agreement. The transfer price of the Customized Project is expected to not exceed RMB1,320 million (including part of the customization price in the aggregate amount of RMB537.3525 million that was made by Chancheng Hospital as at 31 March 2021).

The Company will comply with the Hong Kong Listing Rules requirements, as and when applicable, in relation to the performance of the Customization Agreement.

Development and construction of the Customized Project

Foshan Chanxi agreed to develop and construct the 5th inpatient building, the 6th nursing home of the "Chancheng Medical Health City Complex Project" constructed by Foshan Chanxi (i.e. the Customized Project) in accordance with the customized requirements of Chancheng Hospital.

Customization price for the development and construction of Customized Project

1. The customization price for the development and construction of Customized Project shall comprise the sum of all costs and expenses actually incurred during the development and construction of the Customized Project, including the land costs and expenses, the costs and expenses of development and construction, the costs and expenses of decoration, the apportioned costs of ancillary public infrastructure and other related costs and expenses that may be incurred in relation to the Customized Project.

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