Wanda Hotel Development : (1) MAJOR AND CONNECTED TRANSACTIONS PROPOSED ASSIGNMENTS OF RECEIVABLES AND (2) CONTINUING CONNECTED TRANSACTIONS HOTEL DESIGN FRAMEWORK AGREEMENT AND HOTEL CONSTRUCTION MANAGEMENT FRAMEWORK AGREEMENT

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

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.

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

If you have sold or transferred all your shares in Wanda Hotel Development Company Limited, you should at once hand this Circular, together with the enclosed form of proxy, to the purchaser or the transferee or to the licensed security dealer, registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or the transferee.

萬 達 酒 店 發 展 有 限 公 司

WANDA HOTEL DEVELOPMENT COMPANY LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code : 169)

1. MAJOR AND CONNECTED TRANSACTIONS PROPOSED ASSIGNMENTS OF RECEIVABLES
   AND
2. CONTINUING CONNECTED TRANSACTIONS HOTEL DESIGN FRAMEWORK AGREEMENT AND

HOTEL CONSTRUCTION MANAGEMENT FRAMEWORK AGREEMENT

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

A letter from the Board is set out on pages 6 to 26 of this Circular. A letter of advice containing the recommendation from the Independent Board Committee to the Independent Shareholders is set out on pages 27 to 28 of this Circular. A letter of advice from Opus Capital, the Independent Financial Adviser, to the Independent Board Committee and the Independent Shareholders is set out on pages 29 to 63 of this Circular.

A notice of the SGM to be held at Unit 3007, 30/F., Two Exchange Square, 8 Connaught Place, Central, Hong Kong on 17 December 2019 at 10:00 a.m. is set out on pages SGM-1 to SGM-2 of this Circular. Whether or not you are able to attend and vote at the SGM in person, you are requested to complete and return the accompanying form of proxy in accordance with the instructions printed thereon and return it to the Company's Hong Kong branch share registrar, Tricor Standard Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong as soon as possible and in any event not later than 48 hours before the time appointed for holding the SGM or any adjournment thereof (as the case may be).

Completion and return of the form of proxy will not preclude you from attending and voting in person at the SGM or any adjournment thereof should you so wish and in such event, the form of proxy shall be deemed to be revoked.

28 November 2019

CONTENTS

			Page
Definitions	....................................................................................................................	1-5
Letter from the Board ........................................................................................	6-26
Letter from the Independent Board Committee ................................	27-28
Letter from Opus Capital Limited ................................................................	29-63
Appendix I	-	Financial information of the Group ....................	I-1
Appendix II	-	General information ......................................................	II-1
Notice of SGM ..............................................................................................................	SGM-1

- i -

DEFINITIONS

In this Circular, unless otherwise defined or the context requires otherwise, the following expressions have the meanings set out below:

"associate(s)"	has the meaning ascribed thereto in the Listing Rules
"AUD Loan"	a interest-free loan in the principal amount of AU$105,000,000
	(equivalent to approximately HK$556,773,000) advanced
	by Wanda HK to Wanda Australia RE which is payable on
	demand and remains outstanding as at the Latest Practicable
	Date
"Australia Projects Receivables"	the receivables in the total amount of AU$105,000,000
	(equivalent to approximately HK$556,773,000) due to
	Wanda Australia RE from AWH Investment Group Pty Ltd,
	the purchaser of the Australia Property Projects under the
	Australia SPA as consideration receivable for the disposal of
	the Australia Property Projects, each of which became due in
	November 2018
"Australia Property Projects"	the rights and interests in the real estate development project
	located at One Alfred Street, Circular Quay, Sydney Australia
	and 38-44 Old Burleigh Road, Surfers Paradise, Queensland,
	Australia, details of which are disclosed in the Company's
	announcement dated 29 January 2018
"Australia SPA"	the master agreement dated 18 January 2018 entered into by
	Wanda Australia RE, AWH Investment Group Pty Ltd and
	Wanda Australia Commercial Properties Pty Ltd. relating
	to the disposal of the Australia Property Projects, details of
	which are disclosed in the Company's announcement dated 29
	January 2018
"AU$"	Australian dollar, the lawful currency of Australia
"Board"	the Board of Directors
"Circular"	this circular issued by the Company dated 28 November 2019
"Closing"	the closing of the Proposed Assignments pursuant to the Deed
	of Assignment of Australia Projects Receivables and/or the
	Deed of Assignment of London Project Receivables
"Company"	Wanda Hotel Development Company Limited, a company
	incorporated in Bermuda with limited liability, the issued
	Shares of which are listed on the main board of the Stock
	Exchange
"Conditions"	the conditions precedent to Closing

- 1 -

	DEFINITIONS
"connected person(s)"	has the meaning ascribed thereto in the Listing Rules
"controlling shareholder(s)"	has the meaning ascribed thereto in the Listing Rules
"Dalian Wanda Group"	大連萬達集團股份有限公司 (Dalian Wanda Group Co.,
	Ltd*), a joint stock company incorporated in the PRC with
	limited liability, and a controlling shareholder of the Company
"Deed of Assignment of	the deed of assignment of Australia Projects Receivables dated
Australia Projects Receivables"	18 October 2019 entered into by Wanda Australia RE and
	Wanda HK
"Deed of Assignment of	the deed of assignment of London Project Receivables dated
London Project Receivables"	18 October 2019 entered into by the Company and Wanda HK
"Director(s)"	the director(s) of the Company
"DWCM Group"	大連萬達商業管理集團股份有限公司 ( D a l i a n W a n d a
	Commercial Management Group Co., Ltd*), a company
	established in the PRC with limited liability and controlled
	by Dalian Wanda Group, a controlling shareholder of the
	Company
"Framework Agreements"	the Hotel Design Framework Agreement and the Hotel
	Construction Management Framework Agreement
"Group"	the Company and its subsidiaries
"Hong Kong"	The Hong Kong Special Administrative Region of the People's
	Republic of China
"Hotel Construction Management	the hotel construction management services framework
Framework Agreement"	agreement entered into between the Company and Dalian
	Wanda Group on 18 October 2019
"Hotel Design Framework	the hotel design consulting services framework agreement
Agreement"	entered into between the Company and Dalian Wanda Group
	on 18 October 2019
"Hotel Design Services"	has the meaning ascribed to it in the section headed "Letter
	from the Board - II. The Framework Agreements - (1) Hotel
	Design Framework Agreement - Services" of this Circular
"HK$"	Hong Kong dollar, the lawful currency of Hong Kong

- 2 -

	DEFINITIONS
"Independent Board Committee"	the independent committee of the Board comprising all the
	independent non-executive Directors, being Dr. Chen Yan, Mr.
	He Zhiping, Dr. Teng Bing Sheng, established for the purpose
	of advising the Independent Shareholders on the Proposed
	Assignments, the Framework Agreements and the transactions
	contemplated thereunder
"Independent Financial	Opus Capital Limited, a corporation licensed under the
Adviser" or "Opus Capital"	Securities and Futures Ordinance (Chapter 571 of the Laws
	of Hong Kong) to carry out Type 1 (dealing in securities) and
	Type 6 (advising on corporate finance) regulated activities,
	being the independent financial adviser engaged by the
	Company to advise the Independent Board Committee and the
	Independent Shareholders on the Proposed Assignments, the
	Framework Agreements and the transactions contemplated
	thereunder
"independent third party(ies)"	the party(ies) which is/are independent of the Group and the
	connected persons of the Company
"Individual Hotel Construction	has the meaning ascribed to it in the section headed "Letter
Management Agreement"	from the Board - II. The Framework Agreements - (2) Hotel
	Construction Management Framework Agreement - Services"
	of this Circular
"Individual Hotel Design	has the meaning ascribed to it in the section headed "Letter
Agreement"	from the Board - II. The Framework Agreements - (1) Hotel
	Design Framework Agreement - Services" of this Circular
"Independent Shareholders"	the Shareholders other than Wanda Overseas and its associates
"Latest Practicable Date"	22 November 2019, being the latest practicable date prior to
	the printing of this Circular for ascertaining certain information
	contained herein
"LIBOR"	the London Inter-bank Offered Rate
"Listing Rules"	The Rules Governing the Listing of Securities on the Stock
	Exchange
"London Property Project"	the project for the redevelopment of the property located at
	Market Towers, 1 Nine Elms Lane, London SW8 5NQ, United
	Kingdom, details of which are disclosed in the Company' s
	announcement dated 16 January 2018

- 3 -

	DEFINITIONS
"London Project Receivables"	the receivables in the total amount of £24,000,000 (equivalent
	to approximately HK$241,392,000) due to the Company
	by R&F Properties (HK) Company Limited, the purchaser
	of the London Property Project, as consideration receivable
	by the Company under the London SPA, £12,000,000 of
	which became due in December 2018 while the remaining
	£12,000,000 will become due in December 2019
"London SPA"	the sale and purchase agreement (as amended) dated 16 January
	2018 entered into by the Company and an independent third
	party relating to the disposal of the London Property Project,
	details of which are disclosed in the Company's announcement
	dated 16 January 2018
"Proposed Assignment(s)"	the transactions contemplated under the Deed of Assignment of
	Australia Projects Receivables and/or the Deed of Assignment
	of London Project Receivables
"RMB"	Renminbi, the lawful currency of the People's Republic of
	China
"SGM"	the special general meeting of the Company to be convened
	and held for the Independent Shareholders to consider and, if
	thought fit, approve the Proposed Assignments, the Framework
	Agreements and the transactions contemplated thereunder
"Share(s)"	the ordinary share(s) in the share capital of the Company
"Shareholder(s)"	the holder(s) of the issued Shares
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"USD Loan"	a loan in the principal amount of approximately US$200,000,000
	(equivalent to approximately HK$1,568,760,000) at
	three-month LIBOR rate plus 1% advanced by Wanda HK to
	the Company which is will be repayable on 31 December 2020
	and remains outstanding as at the Latest Practicable Date.
"US$"	United States dollar, the lawful currency of the United States
	of America
"Wanda Australia RE"	Wanda Australia Real Estate Investment Co., Limited, a
	company with limited liability incorporated under the laws
	of Hong Kong and a non-wholly owned subsidiary of the
	Company

- 4 -

	DEFINITIONS
"Wanda HK"	Wanda Commercial Properties (Hong Kong) Co. Limited
	(萬達商業地產（香港）有限公司), a company with limited
	liability incorporated under the laws of Hong Kong, a
	controlling shareholder of the Company
"Wanda Hotel Management (HK)" Wanda Hotel Management (Hong Kong) Co. Limited (萬達
	酒店管理(香港)有限公司), a company incorporated in Hong
	Kong with limited liability and a wholly owned subsidiary of
	the Company
"Wanda Overseas"	Wanda Commercial Properties Overseas Limited, a company
	incorporated in the British Virgin Islands with limited liability,
	a controlling shareholder of the Company
"WHMHK Group"	Wanda Hotel Management (Hong Kong) Co. Limited, a
	company incorporated in Hong Kong with limited liability
	and a wholly owned subsidiary of the Company, and its
	subsidiaries
"£"	British pound sterling, the lawful currency of the United
	Kingdom
"%"	per cent

* For identification purposes only

For the purpose of this Circular and for illustration purpose only, the exchange rate between US$ and HK$ is 1: 7.8438, the exchange rate between £ and HK$ is 1: 10.0580 and the exchange rate between AU$ and HK$ is 1: 5.3026 and no representation is made that any amount in US$ or £ or HK$ or AU$ could have been or could be converted at such rates or at any other rates.

- 5 -

LETTER FROM THE BOARD

萬 達 酒 店 發 展 有 限 公 司

WANDA HOTEL DEVELOPMENT COMPANY LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code : 169)

Non-Executive Directors:	Head office and principal place of
Mr. Ding Benxi (Chairman)	business in Hong Kong:
Mr. Zhang Lin	Unit 3007, 30th Floor
Mr. Han Xu	Two Exchange Square
Executive Director:	8 Connaught Place
Central
Mr. Ning Qifeng	Hong Kong
Independent non-Executive Directors:	Registered office:
Mr. He Zhiping	Canon's Court
Dr. Chen Yan	22 Victoria Street
Dr. Teng Bing Sheng	Hamilton HM 12
	Bermuda
	28 November 2019
To the Shareholders
Dear Sir and Madam,

1. MAJOR AND CONNECTED TRANSACTIONS PROPOSED ASSIGNMENTS OF RECEIVABLES;

AND

1. CONTINUING CONNECTED TRANSACTIONS HOTEL DESIGN FRAMEWORK AGREEMENT AND

HOTEL CONSTRUCTION MANAGEMENT FRAMEWORK AGREEMENT

INTRODUCTION

Reference is made to the announcement of the Company dated 18 October 2019 in relation to the major and connected transactions in relation to the Proposed Assignments; and the continuing connected transactions relating to the Hotel Design Framework Agreement and the Hotel Construction Management Framework Agreement.

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LETTER FROM THE BOARD

The purpose of this Circular is to provide you with, among other things, (i) details of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder; (ii) the advice and recommendation of the Independent Board Committee in respect of the Proposed Assignments, Framework Agreements and the transactions contemplated thereunder; (iii) the advice and recommendation of the Independent Financial Adviser regarding the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder; (iv) other information as required under the Listing Rules; and (v) a notice convening the SGM and a proxy form.

1. THE PROPOSED ASSIGNMENTS
   Reference is made to the announcement of the Company dated 16 January 2018 in relation to the disposal of the London Property Project. Reference is also made to the announcement of the Company dated 29 January 2018 in relation to the disposal of the Australia Property Projects.
   On 18 October 2019, the Company entered into the Deed of Assignment of London Project Receivables with Wanda HK pursuant to which the Company agreed to assign to Wanda HK and Wanda HK has agreed to accept the rights, title and benefits in and to and arising from the London Project Receivables in the aggregate amount of £24,000,000 (equivalent to approximately HK$241,392,000), on the terms and subject to conditions set out thereunder.
   On 18 October 2019, Wanda Australia RE entered into the Deed of Assignment of Australia Projects Receivables with Wanda HK pursuant to which Wanda Australia RE agreed to assign to Wanda HK and Wanda HK has agreed to accept the rights, title and benefits in and to and arising from the Australia Projects Receivables in the aggregate amount of AU$105,000,000 (equivalent to approximately HK$556,773,000), on the terms and subject to conditions set out thereunder.
2. 1. Deed of Assignment of London Project Receivables
      A summary of the principal terms of the Deed of Assignment of London Project Receivables is set out as follows:

Date:	18 October 2019
Assignor:	The Company
Assignee:	Wanda HK

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LETTER FROM THE BOARD

Subject matter:	The Company agreed to assign to Wanda HK and Wanda
	HK has agreed to accept the rights, title and benefits in
	and to and arising from the London Project Receivables,
	on the terms and subject to conditions set out under the
	Deed of Assignment of London Project Receivables,
	under which Wanda HK also agreed to indemnify the
	Company for all claims arising from the London SPA
	and any loss, debt, damage, loss and other fees incurred
	by the Company resulting from such claim.
	The Company has the right to charge interest for any late
	payment of the consideration under the London SPA and
	such right is not subject to the Deed of Assignment of
	London Project Receivables.
Consideration:	The consideration for the London Project Receivables
	was determined and agreed on the basis of the face
	value of the London Project Receivables which is in
	the aggregate amount of £24,000,000 (equivalent to
	approximately HK$241,392,000) and will be off-set
	and deducted from the USD Loan on a dollar-for-dollar
	basis at a foreign exchange rate expressed as the amount
	of US$ per one £ quoted by the People's Bank of China
	as at the date of Closing. As such, the Company does
	not expect to record any gain or loss from the Proposed
	Assignment.
	The book value of the London Project Receivables as at
	the Latest Practicable Date is £24,000,000 (equivalent to
	approximately HK$241,392,000).
Conditions:	Closing shall be conditional upon the satisfaction of the
	following Conditions:
	(1) the Company having obtained the Independent
	Shareholders' approval for the Deed of
	Assignment of London Project Receivables and
	the transactions contemplated thereunder at the
	SGM; and

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LETTER FROM THE BOARD

(2) all requisite approvals from third parties (including any applicable governmental and regulatory authorities) in connection with the entering into and performance of the terms of the Deed of Assignment of London Project Receivables having

	been obtained.
	If any of the above Conditions have not been fulfilled on
	or before 31 December 2019, all rights and obligations
	of the parties to the Deed of Assignment of London
	Project Receivables shall cease and terminate, save and
	except for any antecedent breach thereof.
Closing:	Closing will take place within 1 business day after the
	Conditions have been fulfilled in accordance with the
	Deed of Assignment of London Project Receivables.

1. Deed of Assignment of Australia Projects Receivables
   A summary of the principal terms of the Deed of Assignment of Australia Projects Receivables is set out as follows:

Date:	18 October 2019
Assignor:	Wanda Australia RE
Assignee:	Wanda HK
Subject matter:	Wanda Australia RE agreed to assign to Wanda HK
	and Wanda HK has agreed to accept the rights, title and
	benefits in and to and arising from the Australia Projects
	Receivables, on the terms and subject to conditions set
	out under the Deed of Assignment of Australia Projects
	Receivables, under which Wanda HK also agreed to
	indemnify Wanda Australia RE for all claims arising
	from the Australia SPA and any loss, debt, damage, loss
	and other fees incurred by the Company resulting from
	such claim.

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LETTER FROM THE BOARD

	The Company has the right to charge interest for any late
	payment of the consideration under the Australia SPA
	and such right is not subject to the Deed of Assignment
	of Australia Projects Receivables.
Consideration:	The consideration for the Australia Projects Receivables
	was determined and agreed on the basis of the face
	value of the Australia Projects Receivables which is in
	the aggregate amount of AU$105,000,000 (equivalent
	to approximately HK$556,773,000) and will be off-set
	and deducted from the AUD Loan on a dollar-for-dollar
	basis. As such, the Company does not expect to record
	any gain or loss from the Proposed Assignment.
	The book value of the Australia Projects Receivables
	as at the Latest Practicable Date is AU$105,000,000
	(equivalent to approximately HK$556,773,000).
Conditions:	Closing shall be conditional upon the satisfaction of the
	following Conditions:
	(1) the Company having obtained the Independent
	Shareholders' approval for the Deed of
	Assignment of Australia Projects Receivables and
	the transactions contemplated thereunder at the
	SGM; and
	(2) all requisite approvals from third parties (including
	any applicable governmental and regulatory
	authorities) in connection with the entering into
	and performance of the terms of the Deed of
	Assignment of Australia Projects Receivables
	having been obtained.
	If any of the above Conditions have not been fulfilled on
	or before 31 December 2019, all rights and obligations
	of the parties to the Deed of Assignment of Australia
	Projects Receivables shall cease and terminate, save and
	except for any antecedent breach thereof.
Closing:	Closing will take place within 1 business day after the
	Conditions have been fulfilled in accordance with the
	Deed of Assignment of Australia Projects Receivables.

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LETTER FROM THE BOARD

REASONS FOR AND BENEFITS OF AND FINANCIAL EFFECTS OF THE PROPOSED ASSIGNMENTS

As at the Latest Practicable Date, the Company recorded Australia Projects Receivables and London Project Receivables in the amount of AU$105,000,000 (equivalent to approximately HK$556,773,000) and £24,000,000 (equivalent to approximately HK$241,392,000) respectively.

As the Australia Projects Receivables and the London Project Receivables will be off-set and deducted from the AUD Loan and the USD Loan respectively on a dollar-for-dollar basis, this would significantly reduce the outstanding loan owing to Wanda HK by the Group and in turn enhance the Company's loan to equity ratio. The Company will therefore benefit from a better capital structure and reduce its debt obligations which it would otherwise have been required to repay at maturity of the AUD Loan and the USD Loan. In addition, the Proposed Assignments offer the Group an opportunity to eliminate the inherent risk of non-recoverability associated with such amounts and enable the Company to save time and resources that will otherwise be utilized for recovering and collecting the Australia Projects Receivables and the London Project Receivables.

The Proposed Assignments are not expected to give rise to any gain or loss and any change to the net asset value of the Company.

Based on the above, the Directors (including the independent non-executive Directors) consider that the Proposed Assignments are in the interests of the Company and the Shareholders as a whole, on normal commercial terms and that the terms of the Proposed Assignments are fair and reasonable.

1. THE FRAMEWORK AGREEMENTS
   On 18 October 2019, the Company entered into (i) the Hotel Design Framework Agreement with Dalian Wanda Group, pursuant to which Dalian Wanda Group and/or its subsidiaries may from time to time engage the Group including Wanda Hotel Management (HK) to provide Hotel Design Services (as defined below) for the hotel projects of Dalian Wanda Group; and (ii) the Hotel Construction Management Framework Agreement with Dalian Wanda Group, pursuant to which Dalian Wanda Group and/or its subsidiaries may from time to time engage the Group including Wanda Hotel Management (HK) to provide hotel construction management services for the hotel projects of Dalian Wanda Group.

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LETTER FROM THE BOARD

1. Hotel Design Framework Agreement

A summary of the principal terms of the Hotel Design Framework Agreement is set out as follows:

Date:	18 October 2019
Parties:	(i)	Dalian Wanda Group, a controlling shareholder of
		the Company as at the Latest Practicable Date
	(ii)	The Company
Term:	From the day on which Independent Shareholders'
	approval in respect of the Hotel Design Framework
	Agreement is obtained at the SGM to 31 December 2021
Services:	Pursuant to the Hotel Design Framework Agreement,
	Dalian Wanda Group and/or its subsidiaries may from
	time to time engage the Group including Wanda Hotel
	Management (HK) to provide hotel design consulting
	services (the "Hotel Design Services") which may
	include, but not limited to, the below services for Dalian
	Wanda Group's hotel projects:
	(i)	interior, furniture, fixtures and equipment design
		and consulting services;
	(ii)	back-of-house area design review services;
	(iii)	outdoor direction signage and indoor lighting
		design consulting services; and
	(iv)	kitchen and launderette area design services.

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LETTER FROM THE BOARD

	Dalian Wanda Group and/or its subsidiaries and
	the Group shall enter into separate agreements
	(the "Individual Hotel Design Agreement(s)") in
	relation to the provision of Hotel Design Services for
	relevant projects, which shall be subject to the terms
	and conditions under the Hotel Design Framework
	Agreement and the annual caps thereunder. The duration
	of each Individual Hotel Design Agreement shall
	not exceed the term of the Hotel Design Framework
	Agreement and the terms of the Individual Hotel Design
	Agreements shall be made on normal commercial terms.
Service fees and	The service fees payable by Dalian Wanda Group to

• pricing policy: the Group for the Hotel Design Services under each Individual Hotel Design Agreement shall be fair and reasonable and shall be determined after arm's length negotiations based on normal commercial terms with reference to the scope of service, hotel grading, size of the hotel project by square meter, and within the range of the prevailing market prices by taking into account the quotations obtained by Dalian Wanda Group from at least two independent third party suppliers for the provision of equivalent or similar services in their ordinary course of business and which shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third party in hotels of equivalent or similar grading.

In order to ensure that the terms of the Individual Hotel Design Agreements signed on or after the date of the Hotel Design Framework Agreement are and will be made on normal commercial terms, the Group will establish a review mechanism to monitor the prevailing service fees and contractual terms for equivalent or similar services in the market and approve in advance the terms of each Individual Hotel Design Agreement signed on or after the date of the Hotel Design Framework Agreement to ensure that its actual service fees rates and contractual terms shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties in hotels of equivalent or similar grading. Under the proposed review mechanism to be established, the Company will, prior

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LETTER FROM THE BOARD

to the signing of each of the Individual Hotel Design Agreements, designate members of the management in its finance and compliance team to review each of such agreements by comparing their terms against the terms for equivalent or similar services provided by the Group to independent third parties in hotels of equivalent or similar grading. Once the designated members determine, after arm's length negotiations, that the terms of the Individual Hotel Design Agreement are on normal commercial terms or better, the agreement will be approved by such designated members for signing. The review mechanism is intended to ensure that the terms of each Individual Hotel Design Agreement will be entered into after arm's length negotiations based on normal commercial terms.

If in the future the Group is of the view that the service fees and contractual terms fixed under the Hotel Design Framework Agreement are, from the Group's perspective, less favourable than that provided by the Group to independent third parties at the time, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Design Framework Agreement to ensure that each new Individual Hotel Design Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties for hotels of equivalent or similar grading during the same period. If the rates charged and terms for equivalent or similar services provided by the Group to Dalian Wanda Group becomes less favourable than that provided by the Group to independent third parties, signifying a deviation from the terms of the Hotel Design Framework Agreement, the Company will re-comply with the Listing Rules requirements if applicable.

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LETTER FROM THE BOARD

For reference, the following table sets out the income of Wanda Hotel Management (HK) and its subsidiaries (together, the "WHMHK Group"), which became subsidiaries of the Company in December 2018, that are principally engaged in provision of hotel management services (including hotel design and hotel construction management services) as at the Latest Practicable Date, generated from providing Hotel Design Services to Dalian Wanda Group for each of the two years ended 31 December 2017 and 2018 and for the 10 months ended

31 October 2019:

			Year ended	10 months ended
			31 December	31 October
		2017	2018	2019
		(Note)	(Note)
	Historical figures	2.48	14.83	0.29
	(HKD million)
	Note: Figures as extracted from the 2018 Annual Report of the
	Company
Annual caps:	The annual caps of the maximum aggregate amounts
	payable by Dalian Wanda Group for each of the three
	years ending 31 December 2021 for the provision of
	Hotel Design Services by the Group are set out below:
		Year ending 31 December
		2019	2020	2021
	Annual caps	52.34	92.45	70.92
	(RMB million)

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LETTER FROM THE BOARD

The annual caps in respect of the transactions contemplated under the Hotel Design Framework Agreement are arrived at after taking into consideration of, among others, (i) the anticipated demand for Hotel Design Services by Dalian Wanda Group based on the current development plan of the existing property projects of Dalian Wanda Group and on the assumption that Dalian Wanda Group will continue to develop the existing property projects, with reference to the expected business commencement dates of the hotel projects, payment terms, anticipated gross floor area of the hotel projects and unit price of the Hotel Design Services having regards to the grading in respect of the hotels developments; (ii) the prevailing market prices for the relevant design services; and (iii) a buffer of 25% taking into account, among others, (a) the inflation expected during the term of the Hotel Design Framework Agreement (taking into account the average historical inflation rate in China in 2016, 2017 and 2018 of approximately 1.9% and the historical inflation rate in China in the first eight months of 2019 of approximately 2.4%); (b) a potential fluctuation in the annual caps of over 20% in each year during the term of the Hotel Design Framework Agreement due to the potential additional demand for Hotel Design Services by Dalian Wanda Group during the term of the Hotel Design Framework Agreement, the possibility of early or delay in revenue recognition due to the progress of Hotel Design Services during the term of the Hotel Design Framework Agreement and the possibility of securing new agreements for the provision of Hotel Design Services. The annual caps are arrived at after taking into account the above factors and the fluctuation in the annual caps is mainly affected by the expected percentage of completion of work of each hotel project in the current development plan of Dalian Wanda Group during the 3 years ending 31 December 2021 and the estimated number of hotel projects completing in each of the years ending 31 December 2020 and 2021 and 6 months ending 30 June 2022, for which Hotel Design Services in the year prior to completion would be required.

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LETTER FROM THE BOARD

1. Hotel Construction Management Framework Agreement

A summary of the principal terms of the Hotel Construction Management Framework Agreement is set out as follows:

Date:	18 October 2019
Parties:	(i) Dalian Wanda Group, a controlling shareholder of
	the Company as at the Latest Practicable Date
	(ii) The Company
Term:	From the day on which Independent Shareholders'
	approval in respect of the Hotel Construction
	Management Framework Agreement is obtained at the
	SGM to 31 December 2021
Services:	Pursuant to the Hotel Construction Management
	Framework Agreement, Dalian Wanda Group and/
	or its subsidiaries may from time to time engage the
	Group including Wanda Hotel Management (HK) to
	provide hotel construction management services. For the
	avoidance of doubt, such services do not include project
	design, construction and supervision work, in respect
	of which Dalian Wanda Group should hire relevant
	professional advisory body(ies) and be responsible for
	such expenses.
	Dalian Wanda Group and/or its subsidiaries and
	the Group shall enter into separate agreements
	(the "Individual Hotel Construction Management
	Agreement(s)") in relation to the provision of hotel
	construction management services for relevant projects,
	which shall be subject to the terms and conditions
	under the Hotel Construction Management Framework
	Agreement and the annual caps thereunder. The duration
	of each Individual Hotel Construction Management
	Agreement shall not exceed the term of the Hotel
	Construction Management Framework Agreement
	and the terms of the Individual Hotel Construction
	Management Agreements shall be made on normal
	commercial terms.

- 17 -

LETTER FROM THE BOARD

Service fees and

The service fees payable by Dalian Wanda Group to the

• pricing policy: Group for the hotel construction management services for each hotel shall be fair and reasonable and the consultation and hotel construction management service fees for each project shall be charged according to the project area and such fee shall not exceed RMB136 per square meter. The ceiling of the unit price of RMB136 per square meter is higher than the current unit price charged by the Group to independent third parties for equivalent or similar services, and was determined after taking into account historical unit price charged by WHMHK Group to Dalian Wanda Group and possible inflation during the term of the Hotel Construction Management Services Framework Agreement. The service fee for each project shall be determined after arm's length negotiations based on normal commercial terms with reference to the prevailing market prices by taking into account the fee charged by the Group to independent third party for equivalent or similar services. The fee charged by the Company shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third party.

In order to ensure that the terms of the Individual Hotel Construction Management Agreements shall be made on normal commercial terms or better, the actual service fees rates for each Individual Hotel Construction Management Agreement shall be determined with reference to the prices and terms provided by the Group to independent third parties for similar services. In order to ensure that the terms of the Individual Hotel Construction Management Agreements signed on or after the date of the Hotel Construction Management Framework Agreement are and will be made on normal commercial terms, the Group will establish a review mechanism to monitor the prevailing service fees and contractual terms for equivalent or similar services in the market and approve in advance the terms of each Individual Hotel Construction Management Agreement signed on or after the date of the Hotel Construction Management Framework Agreement to ensure that its actual service fees rates and contractual terms shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third party.

- 18 -

LETTER FROM THE BOARD

Under the proposed review mechanism to be established, the Company will, prior to the signing of each of the Individual Hotel Construction Management Agreements, designate members of the management in its finance and compliance team to review each of such agreements by comparing their terms against the terms for equivalent or similar services provided by the Group to independent third parties. Once the designated members determine, after arm's length negotiations, that the terms of the Individual Hotel Construction Management Agreement are on normal commercial terms or better, the agreement will be approved by such designated members for signing. The review mechanism is intended to ensure that the terms of each Individual Hotel Construction Management Agreement will be entered into after arm's length negotiations based on normal commercial terms. If in the future the Group is of the view that the service fees and contractual terms fixed under the Hotel Construction Management Framework Agreement are, from the Group's perspective, less favourable than that provided by the Group to independent third parties at the time, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Construction Management Framework Agreement to ensure that each new Individual Hotel Construction Management Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties in hotels of equivalent or similar grading during the same period. If the rates charged and terms for equivalent or similar services provided by the Group to Dalian Wanda Group becomes less favourable than that provided by the Group to independent third parties, signifying a deviation from the terms of the Hotel Construction Management Framework Agreement, the Company will re-comply with the Listing Rules requirements if applicable.

- 19 -

LETTER FROM THE BOARD

For reference, the following table sets out the income of WHMHK Group, which became subsidiaries of the Company in December 2018, that are principally engaged in provision of hotel management (including hotel design and hotel construction management) services as at the Latest Practicable Date, generated from providing hotel construction management services to Dalian Wanda Group for each of the two years ended 31 December 2017 and 2018 and for the 10 months ended

31 October 2019:

			Year ended	10 months ended
			31 December	31 October
		2017	2018	2019
	Historical figures	3.03	5.32	0.54
	(HKD million)
	Note: Figures as extracted from the 2018 Annual Report of the
	Company
Annual caps:	The annual caps of the maximum aggregate amounts
	payable by Dalian Wanda Group for each of the three
	years ending 31 December 2021 for the provision of
	hotel construction management services by the Group
	are set out below:
		Year ending 31 December
		2019	2020	2021
	Annual caps	10.87	31.69	25.12
	(RMB million)

The annual caps in respect of the transactions contemplated under the Hotel Construction Management Framework Agreement are arrived at after taking into consideration of, among others, (i) the anticipated demand for hotel construction management services by Dalian Wanda Group based on the current development plan of the existing hotel projects of Dalian Wanda Group and on the assumption that Dalian Wanda Group will continue to develop the existing property projects, with reference to the expected business commencement dates of the hotel projects, payment terms, anticipated gross floor area of the hotel projects and unit price of the hotel construction management services; (ii) the prevailing market prices for the relevant

- 20 -

LETTER FROM THE BOARD

hotel construction management services; and (iii) a buffer of 25% taking into account, among others, (a) the inflation expected during the term of the Hotel Construction Management Framework Agreement (taking into account the average historical inflation rate in China in 2016, 2017 and 2018 of approximately 1.9% and the historical inflation rate in China in the first eight months of 2019 of approximately 2.4%); (b) a potential fluctuation in the annual caps of over 20% in each year during the term of the Hotel Construction Management Framework Agreement considering the potential additional demand for hotel construction consulting services by Dalian Wanda Group during the term of the Hotel Construction Management Framework Agreement, the possibility of early or delay in revenue recognition due to the progress of hotel project construction consulting services during the term of the Hotel Construction Management Framework Agreement and the possibility of securing new agreements for provision of hotel construction management services. The annual caps are arrived at after taking into account the above factors and the fluctuation in the annual caps is mainly affected by the expected percentage of completion of work of each hotel project in the current development plan of Dalian Wanda Group during the 3 years ending 31 December 2021 and the estimated number of hotel projects completing in each of the years ending 31 December 2020 and 2021 and 6 months ending 30 June 2022, for which hotel construction management services in the years prior to completion would be required.

REASONS FOR AND BENEFITS OF ENTERING INTO THE FRAMEWORK AGREEMENTS

Entering into the Framework Agreements is consistent with the Company's business strategy to capitalise on the Group's hotel management expertise, improve its business operations and maximize return to its Shareholders, especially in light of the Company's recent completion of the acquisition of Wanda Hotel Management (HK), a leading hotel services provider in China with comprehensive capabilities in hotel management and operation, hotel design, and hotel construction management. This enables the Company to achieve scale and market leadership in the hospitality and tourism industry and should create value for the Shareholders. It also expands the Company's revenue resources and improve the Company's profitability. This is in line with the Group's plan to adopt an asset-light business model and the strategic goal of achieving long-term development of the Group and sustainable growth of the Shareholders' value in the long run.

- 21 -

LETTER FROM THE BOARD

The Directors (including the independent non-executive Directors) consider that the terms of the Framework Agreements and the continuing connected transactions contemplated thereunder (including the annual caps) are entered into in the ordinary and usual course of business of the Company, were negotiated on an arm's length basis and are on normal commercial terms, and are fair and reasonable and in the interests of the Shareholders and the Company as a whole.

INTERNAL CONTROL MEASURES ON CONTINUING CONNECTED TRANSACTIONS

In order to safeguard the interests of the Company and the Shareholders as a whole, the Company has adopted certain measures in monitoring the transactions under the Framework Agreements including the following, for so long as the transactions constitute continuing connected transactions of the Company:

1. the legal department of the Company is responsible for the review of any Individual Hotel Design Agreement and Individual Hotel Construction Management Agreement to ensure that the terms thereunder are made in accordance with the terms and conditions (including the pricing policies) of the Hotel Design Framework Agreement and the Hotel Construction Management Framework Agreement, respectively;
2. the Company has designated members of the management in the finance and compliance department of the Company to closely monitor subsisting and potential connected transactions of the Group on a regular basis of no less frequent than every quarter and will review the transactions under the Framework Agreements with Dalian Wanda Group and its subsidiaries to identify any continuing connected transaction that may be at risk of exceeding the annual caps so as to ensure that relevant Listing Rules requirements have been re-complied before any annual cap is being exceeded; and
3. the Company will report any Individual Hotel Design Agreement and Individual Hotel Construction Management Agreement to the independent non-executive Directors for their review during each of the audit committee meetings according to the audit committee meeting agenda. The Company shall ensure that such kind of reporting shall be conducted not less than twice a year.

INFORMATION OF THE PARTIES INVOLVED

The Group

The Group is principally engaged in property development, property investment, property management, development and operation of hotel, hotel management, hotel design and hotel construction management.

- 22 -

LETTER FROM THE BOARD

Wanda Australia RE

Wanda Australia RE is a joint venture platform in Australia formed by the Company with Wanda HK for the joint acquisition and development of suitable real estate projects in Australia. The Company holds 60% equity interest, of Wanda Australia RE and Wanda HK holds 40% equity interest. It is a non-wholly owned subsidiary of the Company.

Wanda HK

Wanda HK is principally engaged in the business of investment holding. It is a controlling shareholder of the Company.

Dalian Wanda Group

Dalian Wanda Group is a large multinational conglomerate focusing on modern services. Its core industries are commercial management, cultural industry, real estate and investment. It is the ultimate holding company of the Company.

LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratios (as defined under the Listing Rules) by aggregating the transactions contemplated under the Deed of Assignment of Australia Projects Receivables and the Deed of Assignment of London Project Receivables exceed 25% but are less than 75%, the Proposed Assignments constitute a major transaction for the Company under Chapter 14 of the Listing Rules. Further, as Wanda HK is an indirect holding company of the Company, Wanda HK is a connected person of the Company under Chapter 14A of the Listing Rules and the Proposed Assignments also constitute connected transactions of the Company. Accordingly, the Proposed Assignments are subject to the reporting, announcement, circular and Independent Shareholders' approval requirements set out in Chapter 14 and Chapter 14A of the Listing Rules.

As at the Latest Practicable Date, Dalian Wanda Group is a controlling shareholder of the Company and therefore a connected person of the Company under the Listing Rules. Accordingly, the transactions contemplated under the Framework Agreements constitute continuing connected transactions of the Company pursuant to Chapter 14A of the Listing Rules. As the highest applicable percentage ratio (as defined under the Listing Rules) of the proposed annual caps in respect of the Framework Agreements exceeds 5%, the transactions contemplated under the Framework Agreements shall be subject to the reporting, announcement, annual review, circular and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

- 23 -

LETTER FROM THE BOARD

On the date the relevant Board meeting for approving the Proposed Assignments and the Framework Agreements was held, (i) Mr. Ding Benxi, being a non-executive Director and the chairman of the Board, was the sole director of Wanda HK, a director and president of Dalian Wanda Group and the sole director of Wanda Australia RE; (ii) Mr. Zhang Lin, being a non-executive Director, was a director of Dalian Wanda Group; (iii) Mr. Han Xu, being a non-executive Director, was a supervisor of Dalian Wanda Group. The aforementioned Directors were not prohibited from voting on the relevant resolution(s) approving the Proposed Assignments and the Framework Agreements under the bye-laws of the Company. As none of the aforementioned Directors were materially interested as a result of their common directorships or position(s) and interests in the Company and the Dalian Wanda Group, none of the Directors is required to abstain from voting on the relevant Board resolutions.

GENERAL

The SGM

The SGM will be convened for the Independent Shareholders to consider and, if thought fit, to approve, among others, the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. Wanda Overseas, being an associate of Wanda HK and Dalian Wanda Group, is interested in 3,055,043,100 Shares representing approximately 65.04% of the issued share capital of the Company as at the Latest Practicable Date, and will abstain from voting on the relevant resolution(s) to be proposed at the SGM to approve the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. To the best of the knowledge of the Directors, as at the Latest Practicable Date, no other Shareholder will be required to abstain from voting thereat as no other Shareholder has any interest in the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder which is different from the other Shareholders.

A notice convening the SGM is set out on pages SGM-1 to SGM-2 of this Circular. Whether or not you intend to attend the meeting or any adjournment thereof, please complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as possible and in any event not less than 48 hours before the time appointed for holding the meeting or any adjournment thereof to the Hong Kong branch share registrar of the Company, Tricor Standard Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong. Completion and return of the form of proxy will not preclude you from subsequently attending and voting at the meeting or any adjournment meeting if you so wish.

- 24 -

LETTER FROM THE BOARD

The Independent Board Committee

The Independent Board Committee, comprising all the independent non-executive Directors, namely Dr. Chen Yan, Mr. He Zhiping, Dr. Teng Bing Sheng, has been established and will advise the Independent Shareholders as to (i) whether the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are fair and reasonable, (ii) whether the transactions contemplated thereunder are on normal commercial terms or better and in the ordinary and usual course of business of the Group, (iii) whether the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole and (iv) how to vote on the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder at the SGM, taking into account of the recommendation of the Independent Financial Adviser.

None of the members of the Independent Board Committee has any interest or involvement in the transactions contemplated under the Proposed Assignments and/or the Framework Agreements. The Independent Board Committee will form its view in respect of the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder after obtaining and considering the advice from the Independent Financial Adviser.

Your attention is drawn to the letter from the Independent Board Committee, which are set out on pages 27 to 28 of this Circular, containing its opinion as to whether the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are fair and reasonable and in the interests of the Company and the Shareholders as a whole and their recommendations as to voting.

The Independent Financial Adviser

The Company has appointed Opus Capital as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard under the Listing Rules. The Independent Financial Adviser will also advise on (i) whether the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are fair and reasonable, (ii) whether the transactions contemplated thereunder are on normal commercial terms or better and in the ordinary and usual course of business of the Group, and (iii) whether the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole.

Your attention is drawn to the letter from the Independent Financial Adviser, which are set out on pages 29 to 63 of this Circular, containing its opinions as to whether the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are fair and reasonable, on normal commercial terms and in the interests of the Company and the Shareholders as a whole and their recommendations as to voting.

- 25 -

LETTER FROM THE BOARD

RECOMMENDATION

The Board considers that (i) the Proposed Assignments and the Framework Agreements are entered into on normal commercial terms and are fair and reasonable so far as the Independent Shareholders are concerned; (ii) the transactions contemplated under the Framework Agreements are in the ordinary and usual course of business of the Group and are in the interests of the Company and the Shareholders as whole; and (iii) although the transactions contemplated under the Proposed Assignments are not in the ordinary and usual course of business of the Group, they are in the interests of the Company and the Shareholders as a whole. Accordingly, the Board recommends the Independent Shareholders to vote in favour of resolutions to be proposed at the SGM to approve the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder.

FURTHER INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this Circular.

Completion of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are subject to the satisfaction of the conditions precedent thereto, including approval by the Independent Shareholders and as such, the Proposed Assignments and the Framework Agreements and the transactions contemplated thereunder may or may not proceed. Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares and other securities of the Company.

Yours faithfully,

For and on behalf of the Board

WANDA HOTEL DEVELOPMENT COMPANY LIMITED

Ding Benxi

Chairman

- 26 -

LETTER FROM THE independent BOARD committee

The following is the text of the letter of advice from the Independent Board Committee, prepared for the purpose of incorporation into this Circular, setting out its recommendation to the Independent Shareholders regarding the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder:

萬 達 酒 店 發 展 有 限 公 司

WANDA HOTEL DEVELOPMENT COMPANY LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code : 169)

28 November 2019

To the Independent Shareholders

Dear Sir and Madam,

1. MAJOR AND CONNECTED TRANSACTIONS PROPOSED ASSIGNMENTS OF RECEIVABLES
   AND
2. CONTINUING CONNECTED TRANSACTIONS HOTEL DESIGN FRAMEWORK AGREEMENT AND

HOTEL CONSTRUCTION MANAGEMENT FRAMEWORK

AGREEMENT

We refer to the circular dated 28 November 2019 issued by the Company to the Shareholders (the "Circular") of which this letter forms part. Capitalised terms used in this letter will have the same meanings as those defined in the Circular unless otherwise specified.

We are members of the Independent Board Committee which has been formed by the Board to consider and advise the Independent Shareholders as to (i) whether the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are fair and reasonable, (ii) whether the transactions contemplated thereunder are on normal commercial terms or better and in the ordinary and usual course of business of the Group, (iii) whether the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole.

- 27 -

LETTER FROM THE independent BOARD committee

We also wish to draw your attention to the letter of advice from Opus Capital, being the Independent Financial Adviser appointed to advise the Independent Board Committee and the Independent Shareholders on the terms of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder, which contains, among other things, Opus Capital advice, opinions and recommendations regarding the terms of the Proposed Assignments and the Framework Agreements, as set out on pages 29 to 63 of the Circular, and the Letter from the Board as set out on pages 6 to 26 of the Circular.

Having given due consideration to the reasons relating to the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder and to the advice and recommendations of Opus Capital Limited stated in its letter of advice dated 28 November 2019:

1. we consider (i) the terms of the Proposed Assignments thereunder to be on normal commercial terms; (ii) the terms of the Proposed Assignments to be fair and reasonable so far as the Independent Shareholders are concerned; and (iii) although the transactions contemplated under the Proposed Assignments are not in the ordinary and usual course of business of the Group, they are in the interests of the Company and the Shareholders as a whole and accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions to be proposed at the SGM to approve the Proposed Assignments and the transactions contemplated thereunder; and
2. we consider (i) the terms of the Framework Agreements to be on normal commercial terms and the transactions contemplated thereunder are in the ordinary and usual course of business of the Group; (ii) the terms of the Framework Agreements to be fair and reasonable so far as the Independent Shareholders are concerned; and (iii) the transactions contemplated under the Framework Agreements to be in the interests of the Company and the Shareholders as a whole and accordingly, we recommend the Independent Shareholders to vote in favour of the resolutions to be proposed at the SGM to approve the Framework Agreements and the respective transactions contemplated thereunder.

Yours faithfully,

Independent Board Committee of

Wanda Hotel Development Company Limited

Mr. He Zhiping Dr. Teng Bing Sheng Dr. Chen Yan

Independent Non-executive Directors

- 28 -

Letter from Opus Capital Limited

The following is the text of a letter of advice from Opus Capital, the Independent Financial Adviser to the Independent Board Committee and Independent Shareholder in relation to the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder for the purpose of inclusion in this Circular.

18th Floor, Fung House

19-20 Connaught Road Central

Central, Hong Kong

28 November 2019

To: The Independent Board Committee and the Independent Shareholders of Wanda Hotel Development Company Limited

Dear Sir or Madam,

1. MAJOR AND CONNECTED TRANSACTIONS PROPOSED ASSIGNMENTS OF RECEIVABLES
   AND
2. CONTINUING CONNECTED TRANSACTIONS HOTEL DESIGN FRAMEWORK AGREEMENT AND

HOTEL CONSTRUCTION MANAGEMENT FRAMEWORK AGREEMENT

INTRODUCTION

We refer to our appointment by the Company to advise the Independent Board Committee and the Independent Shareholders in connection with the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. Details of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder are set out in the letter from the Board (the "Letter from the Board") contained in the circular of the Company dated 28 November 2019 (the "Circular"), of which this letter forms part. Capitalised terms used in this letter shall have the same meanings as those defined in the Circular unless the context requires otherwise.

THE PROPOSED ASSIGNMENTS

As stated in the Letter from the Board, on 18 October 2019, the Company entered into the Deed of Assignment of London Project Receivables with Wanda HK pursuant to which the Company agreed to assign to Wanda HK and Wanda HK has agreed to accept the rights, title and benefits in and to and arising from the London Project Receivables in the aggregate amount of £24,000,000 (equivalent to approximately HK$241,392,000), on the terms and subject to conditions set out thereunder. On 18 October 2019, Wanda Australia RE entered into the Deed of Assignment of Australia Projects Receivables with Wanda HK pursuant to which Wanda Australia RE agreed to assign to Wanda HK and Wanda HK has agreed to accept the rights, title and benefits in and to and arising from the Australia Projects Receivables in the aggregate amount of AU$105,000,000 (equivalent to approximately HK$556,773,000), on the terms and subject to conditions set out thereunder.

- 29 -

Letter from Opus Capital Limited

As one or more of the applicable percentage ratio (as defined under the Listing Rules) by aggregating the transactions contemplated under the Deed of Assignment of Australia Projects Receivables and the Deed of Assignment of London Project Receivables exceeds 25% but are less than 75%, the Proposed Assignments constitute a major transaction for the Company under Chapter 14 of the Listing Rules. Further, as Wanda HK is an indirect holding company of the Company, Wanda HK is a connected person of the Company under Chapter 14A of the Listing Rules. As such, the Proposed Assignments also constitute connected transactions of the Company. Accordingly, the Proposed Assignments are subject to the reporting, announcement, circular and Independent Shareholders' approval requirements set out in Chapter 14 and Chapter 14A of the Listing Rules.

THE FRAMEWORK AGREEMENTS

As stated in the Letter from the Board, on 18 October 2019, the Company entered into: (i) the Hotel Design Framework Agreement with Dalian Wanda Group, pursuant to which Dalian Wanda Group and/or its subsidiaries may from time to time engage the Group including Wanda Hotel Management (HK) to provide Hotel Design Services for the hotel projects of Dalian Wanda Group; and (ii) the Hotel Construction Management Framework Agreement with Dalian Wanda Group, pursuant to which Dalian Wanda Group and/or its subsidiaries may from time to time engage the Group including Wanda Hotel Management (HK) to provide hotel construction management services for the hotel projects of Dalian Wanda Group.

As at the Latest Practicable Date, Dalian Wanda Group was a controlling shareholder of the Company and therefore a connected person of the Company under Chapter 14A of the Listing Rules. Accordingly, the transactions contemplated under the Framework Agreements constitute continuing connected transactions of the Company pursuant to Chapter 14A of the Listing Rules. As the highest applicable percentage ratio (as defined under the Listing Rules) of the proposed annual caps in respect of the Framework Agreements exceed 5%, the transactions contemplated under the Framework Agreements shall be subject to the reporting, announcement, annual review, circular and Independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

BOARD MEETING AND THE SGM

On the date the relevant Board meeting for approving the Proposed Assignments and the Framework Agreements was held: (i) Mr. Ding Benxi, being a non-executive Director and the chairman of the Board, was the sole director of Wanda HK, a director and president of Dalian Wanda Group and the sole director of Wanda Australia RE; (ii) Mr. Zhang Lin, being a non-executive Director, was a director of Dalian Wanda Group; and (iii) Mr. Han Xu, being a non-executive Director, was a supervisor of Dalian Wanda Group. The aforementioned Directors were not prohibited from voting on the relevant Board resolution(s) approving the Proposed Assignments and the Framework Agreements under the bye-laws of the Company. As none of the aforementioned Directors were materially interested as a result of their common directorships or position(s) and interests in the Company and Dalian Wanda Group, none of the Directors is required to abstain from voting on the relevant Board resolutions.

- 30 -

Letter from Opus Capital Limited

The SGM will be convened for the Independent Shareholders to consider and, if thought fit, to approve, among others, the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. As at the Latest Practicable Date, Wanda Overseas, being an associate of Wanda HK and Dalian Wanda Group, was interested in 3,055,043,100 Shares representing approximately 65.04% of the issued share capital of the Company, and will abstain from voting on the relevant resolution(s) to be proposed at the SGM to approve the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. To the best of the knowledge of the Directors, as at the Latest Practicable Date, no other Shareholder will be required to abstain from voting thereat as no other Shareholder has any interest in the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder which is different from the other Shareholders.

THE INDEPENDENT BOARD COMMITTEE

The Independent Board Committee comprising all the independent non-executive Directors, namely Dr. Chen Yan, Mr. He Zhiping and Dr. Teng Bing Sheng, has been established by the Company for the purpose of advising the Independent Shareholders in respect of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder. We have been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders as to: (i) whether the terms of the Proposed Assignments, the Framework Agreements (including the annual caps) and the transactions contemplated thereunder are fair and reasonable; (ii) whether the transactions contemplated thereunder are on normal commercial terms or better and in the ordinary and usual course of business of the Group; (iii) whether the transactions contemplated thereunder are in the interests of the Company and the Shareholders as a whole; and (iv) how to vote on the resolutions relating to the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder at the SGM.

OUR INDEPENDENCE

We were appointed as the independent financial adviser to opine on the tenures of the tenancy agreements dated 29 June 2018 entered into by Guilin Gaoxin Wanda Shopping Plaza Co., Ltd.* ( 桂林高新萬達廣場有限公司), a subsidiary of the Company, with certain connected persons of the Company (the "Past Appointment"), details of which are set out in the announcement of the Company dated 29 June 2018. The transactions under the Past Appointment are independent of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder.

As at the Latest Practicable Date, we do not have any relationship with, or interest in, the Group, Wanda HK, Dalian Wanda Group or any other parties that could reasonably be regarded as relevant to our independence. Apart from normal independent financial advisory fees payable to us in connection with the Past Appointment and this appointment, no arrangements exist whereby we had received or will receive any fees or benefits from the Group, Wanda HK, Dalian Wanda Group or any other parties that could reasonably be regarded as relevant to our independence. Accordingly, we consider that we are independent pursuant to Rule 13.84 of the Listing Rules.

- 31 -

Letter from Opus Capital Limited

BASIS OF OUR OPINION

In formulating our advice and recommendation to the Independent Board Committee and the Independent Shareholders, we have reviewed, amongst other things:

1. the Deed of Assignment of Australia Projects Receivables;
2. the Deed of Assignment of London Project Receivables;
3. the Framework Agreements;
4. the London SPA;
5. the Australia SPA;
6. the Company's interim report for the six months ended 30 June ("HY") 2019 (the "2019 Interim Report");
7. the Company's annual report for the year ended 31 December ("FY") 2018 (the "2018 Annual Report");
8. the Company's announcement of the Australia SPA dated 29 January 2018;
9. the Company's announcement of the London SPA dated 16 January 2018;
10. the Company's announcement of the acquisition (the "Wanda Hotel Acquisition") of Wanda Hotel Management (HK) dated 26 September 2017; and
11. other information as set out in the Circular.

We have relied on the truth, accuracy and completeness of the statements, information, opinions and representations contained or referred to in the Circular and the information and representations made to us by the Company, the Directors and the management of the Group (collectively, the "Management"). We have assumed that all information and representations contained or referred to in the Circular and provided to us by the Management, for which they are solely and wholly responsible, are true, accurate and complete in all respects and not misleading or deceptive at the time when they were provided or made and will continue to be so up to the Latest Practicable Date. Shareholders will be notified of material changes as soon as possible, if any, to the information and representations provided and made to us after the Latest Practicable Date and up to and including the date of the SGM.

- 32 -

Letter from Opus Capital Limited

We have also assumed that all statements of belief, opinion, expectation and intention made by the Management in the Circular were reasonably made after due enquiries and careful consideration and there are no other facts not contained in the Circular, the omission of which make any such statement contained in the Circular misleading. We have no reason to suspect that any relevant information has been withheld, or to doubt the truth, accuracy and completeness of the information and facts contained in the Circular, or the reasonableness of the opinions expressed by the Management, which have been provided to us.

We considered that we have been provided with sufficient information to reach an informed view and to provide a reasonable basis for our opinion. However, we have not carried out any independent verification of the information provided by the Management, nor have we conducted any independent investigation into the business, financial conditions and affairs of the Group or its future prospects. We also have not considered the taxation implications on the Group as a result of the Proposed Assignments, the Framework Agreements and the transactions contemplated thereunder.

The Directors jointly and severally accept full responsibility for the accuracy of the information disclosed and confirm, having made all reasonable enquiries that to the best of their knowledge and belief, there are no other facts not contained in this letter, the omission of which would make any statement herein misleading.

This letter is issued to the Independent Board Committee and the Independent Shareholders solely in connection for their consideration of the terms of the transactions contemplated under the Proposed Assignments and the Framework Agreements, and except for its inclusion in the Circular, is not to be quoted or referred to, in whole or in part, nor shall this letter be used for any other purposes without our prior written consent.

PRINCIPAL FACTORS AND REASONS CONSIDERED

1. THE PROPOSED ASSIGNMENTS
   In arriving at our opinion in respect of the terms of the transactions contemplated under the Proposed Assignments, we have taken into consideration the following principal factors and reasons:
   1. Information of the Group
   The Group is principally engaged in property development, property investment, property management, development and operation of hotel, hotel management, hotel design and hotel construction management.

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Letter from Opus Capital Limited

1. Information of Wanda Australia RE
   Wanda Australia RE is a joint venture platform in Australia formed by the Company with Wanda HK for the joint acquisition and development of suitable real estate projects in Australia. The Company holds 60% equity interest of Wanda Australia RE and Wanda HK holds 40% equity interest. It is a non-wholly owned subsidiary of the Company.
2. Information of Wanda HK
   Wanda HK is principally engaged in the business of investment holding. It is a controlling shareholder of the Company.
3. Reasons for and benefits of and financial effects of the Proposed Assignments
   As stated in the Letter from the Board, as at the Latest Practicable Date, the Company recorded Australia Projects Receivables and London Project Receivables in the amount of AU$105,000,000 (equivalent to approximately HK$556,773,000) and £24,000,000 (equivalent to approximately HK$241,392,000) respectively. As the Australia Projects Receivables and the London Project Receivables will be off-set and deducted from the AUD Loan and the USD Loan respectively on a dollar-for-dollar basis, this would significantly reduce the amount of outstanding loan owing to Wanda HK by the Group and in turn enhance the Company's loan to equity ratio. The Company will therefore benefit from a better capital structure and reduce its debt obligations which it would otherwise have been required to repay at maturity of the AUD Loan and the USD Loan. In addition, the Proposed Assignments offer the Group an opportunity to eliminate the inherent risk of non-recoverability associated with such amounts and enable the Company to save time and resources that will otherwise be utilised for recovering and collecting the Australia Projects Receivables and the London Project Receivables.
   The Proposed Assignments are not expected to give rise to any gain or loss and any change to the net asset value of the Company. Please refer to the section headed "7. Our assessment" below for our assessment of, among others, the reasons for and benefits of the Proposed Assignments.

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Letter from Opus Capital Limited

5. Principal terms of the Deed of Assignment of London Project Receivables

A summary of the principal terms of the Deed of Assignment of London Project Receivables is set out as follows:

Date	:	18 October 2019
Assignor	:	The Company
Assignee	:	Wanda HK
Subject matter	:	The Company agreed to assign to Wanda HK and Wanda HK
		has agreed to accept the rights, title and benefits in and to and
		arising from the London Project Receivables, on the terms and
		subject to conditions set out under the Deed of Assignment
		of London Project Receivables, under which Wanda HK also
		agreed to indemnify the Company for all claims arising from
		the London SPA and any loss, debt, damage, loss and other
		fees incurred by the Company resulting from such claim.
		The Company has the right to charge interest for any late
		payment of the consideration under the London SPA and such
		right is not subject to the Deed of Assignment of London
		Project Receivables.
Consideration	:	The consideration for the London Project Receivables was
		determined and agreed on the basis of the face value of the
		London Project Receivables which is in the aggregate amount
		of £24,000,000 (equivalent to approximately HK$241,392,000)
		and will be off-set and deducted from the USD Loan on a
		dollar-for-dollar basis at a foreign exchange rate expressed
		as the amount of US$ per one £ quoted by the People's Bank
		of China as at the date of Closing. As such, the Company
		does not expect to record any gain or loss from the Proposed
		Assignment.
		The book value of the London Project Receivables as at
		the Latest Practicable Date is £24,000,000 (equivalent to
		approximately HK$241,392,000).
Conditions	:	Closing shall be conditional upon the satisfaction of the
		following Conditions:
		1.	the Company having obtained the Independent
			Shareholders' approval for the Deed of Assignment

of London Project Receivables and the transactions contemplated thereunder at the SGM; and

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Letter from Opus Capital Limited

		2.	all requisite approvals from third parties (including any
			applicable governmental and regulatory authorities) in
			connection with the entering into and performance of
			the terms of the Deed of Assignment of London Project
			Receivables having been obtained.
		If any of the above Conditions have not been fulfilled on
		or before 31 December 2019, all rights and obligations of
		the parties to the Deed of Assignment of London Project
		Receivables shall cease and terminate, save and except for any
		antecedent breach thereof.
Closing	:	Closing will take place within 1 business day after the
		Conditions have been fulfilled in accordance with the Deed of
		Assignment of London Project Receivables.

6. Principal terms of the Deed of Assignment of Australia Projects Receivables

A summary of the principal terms of the Deed of Assignment of Australia Projects Receivables is set out as follows:

Date	:	18 October 2019
Assignor	:	Wanda Australia RE
Assignee	:	Wanda HK
Subject matter	:	Wanda Australia RE agreed to assign to Wanda HK and
		Wanda HK has agreed to accept the rights, title and benefits
		in and to and arising from the Australia Projects Receivables,
		on the terms and subject to conditions set out under the Deed
		of Assignment of Australia Projects Receivables, under which
		Wanda HK also agreed to indemnify Wanda Australia RE for
		all claims arising from the Australia SPA and any loss, debt,
		damage, loss and other fees incurred by the Company resulting
		from such claim.
		The Company has the right to charge interest for any late
		payment of the consideration under the Australia SPA and such
		right is not subject to the Deed of Assignment of Australia
		Projects Receivables.

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Letter from Opus Capital Limited

Consideration	:	The consideration for the Australia Projects Receivables
		was determined and agreed on the basis of the face value of
		the Australia Projects Receivables which is in the aggregate
		amount of AU$105,000,000 (equivalent to approximately
		HK$556,773,000) and will be off-set and deducted from the
		AUD Loan on a dollar-for-dollar basis. As such, the Company
		does not expect to record any gain or loss from the Proposed
		Assignment.
		The book value of the Australia Projects Receivables as at
		the Latest Practicable Date is AU$105,000,000 (equivalent to
		approximately HK$556,773,000).
Conditions	:	Closing shall be conditional upon the satisfaction of the
		following Conditions:
		1.	the Company having obtained the Independent
			Shareholders' approval for the Deed of Assignment
			of Australia Projects Receivables and the transactions
			contemplated thereunder at the SGM; and
		2.	all requisite approvals from third parties (including any
			applicable governmental and regulatory authorities) in
			connection with the entering into and performance of the
			terms of the Deed of Assignment of Australia Projects
			Receivables having been obtained.
		If any of the Conditions have not been fulfilled on or before 31
		December 2019, all rights and obligations of the parties to the
		Deed of Assignment of Australia Projects Receivables shall
		cease and terminate, save and except for any antecedent breach
		thereof.
Closing	:	Closing will take place within 1 business day after the
		Conditions have been fulfilled in accordance with the Deed of
		Assignment of Australia Projects Receivables.

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Letter from Opus Capital Limited

7. Our assessment

1. Improvement of capital structure of the Group

As set out in the 2019 Interim Report, the gearing ratio of the Company, which is the quotient arrived at by dividing net debts of the Group with the aggregate of net debts and total equity of the Group, was approximately 50.9% as at 30 June 2019. The gearing ratio of the Company as at 30 June 2019 has significantly increased as compared with approximately 23.0% as at 31 December 2018. The rise in the gearing ratio as at 30 June 2019 was mainly due to increased loans from an intermediate holding company. Upon completion of the Proposed Assignments, both the principal amounts of the AUD Loan and the USD Loan will be off- set and reduced by the face value of the Australia Projects Receivables and the London Project Receivables on a dollar-to-dollar basis. As such, the Proposed Assignments will decrease the Group's outstanding borrowings on the one hand while eliminating the Australia Projects Receivables and the London Project Receivables in their entirety on the other hand, the combined effect of which will reduce the amount of net debts of the Group while the amount of the total equity will remain unchanged. As such, the gearing ratio will be reduced. As provided by the Management, the gearing ratio of the Group as at 30 June 2019, when prepared on an illustrative basis, will reduce from approximately 50.9% to 44.2% upon completion of the Proposed Assignments. A lowered gearing ratio, meaning relatively less debt compared to equity in the Group's capital structure, would represent an improvement in the Group's capital structure and enhance the Company's borrowing capacity. As mentioned in the 2019 Interim Report, the Group will continue to seek profitable investment opportunities. An enhanced borrowing capability will strengthen the Group's fundraising capacity when potential investment opportunities arise.

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Letter from Opus Capital Limited

1. Reduction of interest expenses
   Pursuant to the terms of the Proposed Assignments and as advised by the Management, only the respective face values of the London Project Receivables and the Australia Projects Receivables are to be off-set and deducted from the respective USD Loan and the AUD Loan on a dollar-for-dollar basis. The Company has the right to charge interest for any late payment of the consideration under the London SPA and the Australia SPA and such right is not subject to the Proposed Assignment. In other words, under the Proposed Assignment, any right to claim interest or penalty interest are not to be assigned under the Proposed Assignments. Therefore, an added benefit we note is the fact that the Deed of Assignment of London Project Receivables essentially allows the Group to offset the face value of the London Project Receivables, which would attract no interest under the Deed of Assignment of London Project Receivables for Wanda HK, with the USD Loan, which is an interest bearing loan with interest payable by the Company at three-month LIBOR plus 1%. The Company is expected to enjoy interest savings as a result of the Deed of Assignment of London Project Receivables. A reduction in interest expense will enhance the Group's financial performance which is in the interests of the Company and the Shareholders as a whole. For the avoidance of doubt, please note since the face value of the Australia Projects Receivables would attract no interest under the Deed of Assignment of Australia Projects Receivables for Wanda HK while on the other hand the AUD Loan is interest-free, no interest savings would be enjoyed by the Company under the Deed of Assignment of Australia Projects Receivables.
2. Elimination of the risk in receivables collection
   We also note that the Proposed Assignments relate mainly to the Australia Projects Receivables and the London Project Receivables which were attributable to the Australia SPA and the London SPA respectively in early 2018. The inherent risk of non-recoverability for the Australia Projects Receivables and the London Project Receivables will increase each day as the relevant receivables past due. As such, the Proposed Assignments will result in the complete elimination of such outstanding receivable balances which we concur will eliminate the inherent risk of non-recoverability associated with the receivable amounts and enable the Company to save time and resources that will otherwise be utilised in the efforts of recovering and collecting the Australia Projects Receivables and the London Project Receivables.

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Letter from Opus Capital Limited

4. Costs-free debt collection

1. We have considered the scenario that the Company assigns the Australia Projects Receivables and the London Project Receivables to an independent third party. Under such scenario, it is very likely that such independent third party would factor a discount to the face values of the Australia Projects Receivables and the London Project Receivables and impose other fees, charges and/or interests after taking into account factors such as the number of days the receivables are past due, the identity and background of the debtors, other costs and risks associated with receivables recoverability. In contrast, under the Proposed Assignments, the Australia Projects Receivables and the London Project Receivables will be off-set and deducted, shortly after the relevant conditions precedent have been fulfilled, from the AUD Loan and the USD Loan respectively on a dollar-for-dollar basis without the Company taking up any costs.

   As the Proposed Assignments resemble the nature of entering into of a factoring arrangement, we have therefore conducted, on a best effort basis, a research of companies whose shares are listed on the Stock Exchange which entered into factoring agreements during the period from 1 July 2017 to the Latest Practicable

   Date. As the research period: (i) provides sufficient sample size for our analysis;

2. is longer than 12 months; and (iii) is a period not too remote from the Latest Practicable Date, we are of the view that the research period is sufficient and representative. Based on our research, we have endeavoured to identify nine factoring agreements and all of such factoring agreements assumed significant costs (which are inclusive of discount to the face values of the respective receivables, other fees, charges and/or interests) which ranged from approximately 10% to 44% of the face values of the respective receivables.

Based on the above, we are of the view that the terms of the Proposed Assignments, in particular the respective Australia Projects Receivables and the London Project Receivables, will be off-set and deducted from the respective AUD Loan and the USD Loan on a dollar-for-dollar basis and costs-free basis, are on better terms to the Company. Nevertheless, given that the Proposed Assignments are one-off arrangements between the Group and Wanda HK, they are not conducted in the ordinary and usual course of business of the Group.

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Letter from Opus Capital Limited

1. THE FRAMEWORK AGREEMENTS
   In arriving at our opinion in respect of the terms of the transactions contemplated under the Framework Agreements, we have taken into consideration the following principal factors and reasons:
2. 1. Information of Dalian Wanda Group
      Dalian Wanda Group is a large multinational conglomerate focusing on modern services. Its core industries are commercial management, cultural industry, real estate and investment. It is the ultimate holding company of the Company.
   2. Reasons for and benefits of entering into the Framework Agreements
      On 26 September 2017, the Company and Wanda HK entered into a sale and purchase agreement in respect of the proposed acquisition of the entire equity interest in Wanda Hotel Management (HK) at a consideration of HK$878 million (subject to downward adjustment). The WHMHK Group is a leading hotel services provider in China, with comprehensive capabilities in hotel management and operation. Further details of the Wanda Hotel Acquisition are set out in the announcement of the Company dated 26 September 2017 and the circular of the Company dated 15 November 2017 respectively. The Wanda Hotel Acquisition was approved in the special general meeting of the Company convened on 8 December 2017.
      As stated in the Letter from the Board, the entering into of the Framework Agreements is consistent with the Company's business strategy to capitalise on the Group's hotel management expertise, improve its business operations and maximise return to its Shareholders, especially in light of the Company's recent completion of the acquisition of Wanda Hotel Management (HK), a leading hotel services provider in China with comprehensive capabilities in hotel management and operation, hotel design, and hotel construction management. This enables the Company to achieve scale and market leadership in the hospitality and tourism industry and should create value for the Shareholders. It also expands the Company's revenue resources and improve the Company's profitability. This is in line with the Group's plan to adopt an asset-light business model and the strategic goal of achieving long-term development of the Group and sustainable growth of the Shareholders' value in the long run.

- 41 -

Letter from Opus Capital Limited

It is noted that as at the date of the announcement of the Wanda Hotel Acquisition, the WHMHK Group managed and operated 65 hotels in China and was contracted to manage 13 additional hotels which were under construction. After completion of the Wanda Hotel Acquisition on 31 December 2018 and as stated in the 2019 Interim Report, as at 30 June 2019, the number of hotels managed and operated by the WHMHK Group increased to 75 and the number of hotels under construction and contracted to be managed by the WHMHK Group increased to 62. The Directors are of the view that as the hotel network of the WHMHK Group continues to grow, it is expected that there will be more hotels to be developed in future, which in turn will increase the demand for Hotel Design Services (as defined herein) and hotel construction management services required by Dalian Wanda Group. As such, the entering into of the Framework Agreements will expand the Group's revenue resources and may improve the Group's profitability. As stated in the 2019 Interim Report, we noted that one of the Group's strategies under the business transformation is to focus on fee-based businesses. The Group also aims to capitalise on the hotel management expertise of the Company (e.g. hotel design, construction and operation management, etc.) where the Group can potentially develop into an industry leader in hotel management in China. To this end, the business to be generated from the Framework Agreements is fee-based while the services provided thereunder are hotel design and construction management. Hence, the entering into of the Framework Agreements aligns with the Group's strategies which is in the ordinary and usual course of business of the Group.

In light of the above, we concur with the Directors' views that the entering into of the Framework Agreements will expand the revenue resources of the Group, improve the profitability of the Group, is in line with the adoption of an asset-light business model and the strategic goal of achieving long-term development which is in the interests of the Company and the Shareholders as a whole.

3. Principal terms of the Hotel Design Framework Agreement

A summary of the principal terms of the Hotel Design Framework Agreement is set out as follows:

Date	:	18 October 2019
Parties	:	(i)	Dalian Wanda Group, a controlling shareholder of the
			Company as at the Latest Practicable Date
		(ii)	The Company
Term	:	From the day on which Independent Shareholders' approval in
		respect of the Hotel Design Framework Agreement is obtained
		at the SGM to 31 December 2021

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Letter from Opus Capital Limited

Services	:	Pursuant to the Hotel Design Framework Agreement, Dalian
		Wanda Group and/or its subsidiaries may from time to time
		engage the Group including Wanda Hotel Management (HK)
		to provide hotel design consulting services (the "Hotel Design
		Services") which may include, but not limited to, the below
		services for Dalian Wanda Group's hotel projects:
		(i)	interior, furniture, fixtures and equipment design and
			consulting services;
		(ii) back-of-house area design review services;
		(iii) outdoor direction signage and indoor lighting design
			consulting services; and
		(iv) kitchen and launderette area design services.
		Dalian Wanda Group and/or its subsidiaries and the Group
		shall enter into separate agreements (the "Individual Hotel
		Design Agreement(s)") in relation to the provision of Hotel
		Design Services for relevant projects, which shall be subject to
		the terms and conditions under the Hotel Design Framework
		Agreement and the annual caps thereunder. The duration of
		each Individual Hotel Design Agreement shall not exceed the
		term of the Hotel Design Framework Agreement and the terms
		of the Individual Hotel Design Agreements shall be made on
		normal commercial terms.
Service fees and	:	The service fees payable by Dalian Wanda Group to the
pricing policy		Group for the Hotel Design Services under each Individual
		Hotel Design Agreement shall be fair and reasonable and shall
		be determined after arm's length negotiations based on normal
		commercial terms with reference to the scope of service,

hotel grading, size of the hotel project by square metre, and within the range of the prevailing market prices by taking into account the quotations obtained by Dalian Wanda Group from at least two independent third party suppliers for the provision of equivalent or similar services in their ordinary course of business and which shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third party for hotels of equivalent or similar grading.

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Letter from Opus Capital Limited

In order to ensure that the terms of the Individual Hotel Design Agreements signed on or after the date of the Hotel Design Framework Agreement are and will be made on normal commercial terms, the Group will establish a review mechanism to monitor the prevailing service fees and contractual terms for equivalent or similar services in the market and approve in advance the terms of each Individual Hotel Design Agreement signed on or after the date of the Hotel Design Framework Agreement to ensure that its actual service fees rates and contractual terms shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties for hotels of equivalent or similar grading. Under the proposed review mechanism to be established, the Company will, prior to the signing of each of the Individual Hotel Design Agreements, designate members of the management in its finance and compliance team to review each of such agreements by comparing their terms against the terms for equivalent or similar services provided by the Group to independent third parties in hotels of equivalent or similar grading. Once the designated members determine, after arm's length negotiations, that the terms of the Individual Hotel Design Agreement are on normal commercial terms or better, the agreement will be approved by such designated members for signing. The review mechanism is intended to ensure that the terms of each Individual Hotel Design Agreement will be entered into after arm's length negotiations based on normal commercial terms.

If in the future the Group is of the view that the service fees and contractual terms fixed under the Hotel Design Framework Agreement are, from the Group's perspective, less favourable than that provided by the Group to independent third parties at the time, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Design Framework Agreement to ensure that each new Individual Hotel Design Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties for hotels of equivalent or similar grading during the same period. If the rates charged and terms for equivalent or similar services provided by the Group to Dalian Wanda Group becomes less favourable than that provided by the Group to independent third parties, signifying a deviation from the terms of the Hotel Design Framework Agreement, the Company will re-comply with the Listing Rules requirements if applicable.

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Letter from Opus Capital Limited

As set out in the Letter from the Board and for reference purpose, the following table sets out the income of the WHMHK Group, which became subsidiaries of the Company in December 2018, that are principally engaged in provision of hotel management services (including hotel design and hotel construction management services) as at the Latest Practicable Date, generated from providing Hotel Design Services to Dalian Wanda Group for each of the two years ended 31 December 2017 and 2018 and for the 10 months ended 31 October 2019:

			10 months
			ended
			31 October
	FY2017	FY2018	2019
	(Note)	(Note)
Historical figures	2.48	14.83	0.29

		(HKD'million)
		Note: Figures as extracted from the 2018 Annual Report
Annual caps	:	The annual caps of the maximum aggregate amounts payable
		by Dalian Wanda Group for each of the three years ending 31
		December 2021 for the provision of Hotel Design Services by
		the Group are set out below:
			Year ending 31 December
			2019	2020	2021
		Annual caps	52.34	92.45	70.92

(RMB million)

The annual caps in respect of the transactions contemplated under the Hotel Design Framework Agreement are arrived at after taking into consideration of, among others, (i) the anticipated demand for Hotel Design Services by Dalian Wanda Group based on the current development plan of the existing property projects of Dalian Wanda Group and on the assumption that Dalian Wanda Group will continue to develop the existing property projects, with reference to the expected business commencement dates of the hotel projects, payment terms, anticipated gross floor area ("GFA") of the hotel projects and unit price of the Hotel Design Services having regards to the grading in respect of the hotels developments; (ii)

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Letter from Opus Capital Limited

the prevailing market prices for the relevant design services; and (iii) a buffer of 25% taking into account, among others,

1. the inflation expected during the term of the Hotel Design Framework Agreement (taking into account the average historical inflation rate in China in 2016, 2017 and 2018 of approximately 1.9% and the historical inflation rate in China in the first eight months of 2019 of approximately 2.4%);
2. a potential fluctuation in the annual caps of over 20% in each year during the term of the Hotel Design Framework Agreement due to the potential additional demand for Hotel Design Services by Dalian Wanda Group during the term of the Hotel Design Framework Agreement; and (c) the possibility of early or delay in revenue recognition due to the progress of Hotel Design Services during the term of the Hotel Design Framework Agreement and the possibility of securing new agreements for the provision of Hotel Design Services. The annual caps are arrived at after taking into account the above factors and the fluctuation in the annual caps is mainly affected by the expected percentage of completion of work of each hotel project in the current development plan of Dalian Wanda Group during the 3 years ending 31 December 2021 and the estimated number of hotel projects completing in each of the years ending 31 December 2020 and 2021 and 6 months ending 30 June 2022, for which Hotel Design Services in the year prior to completion would be required.

We have reviewed the Hotel Design Framework Agreement and note that the pricing terms of the service fees payable by Dalian Wanda Group to the Group for the Hotel Design Services will be determined on the basis as mentioned above. We have also obtained the development plan of the 15 existing property projects of Dalian Wanda Group (the "Hotel Development Plan") from the Management and randomly selected six out of 15 hotel/conference property projects (the "Selected Projects") set out thereunder for the purpose of reviewing, in particular, the pricing terms and payment terms of the Hotel Design Framework Agreement. In view of: (i) the Selected Projects include all the gradings of hotels and conference centres laid out in the Hotel Development Plan; and (ii) the aggregate contract amount of the Selected Projects for the provision of Hotel Design Services, in our opinion, provided sufficient coverage which accounts for over 70% of the total contract sum under the Hotel Development Plan, we are of the view that the sample size of the Selected Projects is sufficient, fair and representative for the purpose of our analysis.

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Letter from Opus Capital Limited

The Hotel Development Plan sets out each of the 15 hotel/conference property projects' details which include, among others, expected official opening date, GFA, unit price of Hotel Design Services per square metre ("sq. m."), unit price of hotel construction management services per sq. m. and total contract sum for Hotel Design Services under the Individual Hotel Design Agreement and hotel construction management services under the Individual Hotel Construction Management Agreement. Based on our discussion with the Management, we were informed that the unit price of Hotel Design Services per sq. m. set out in the Hotel Development Plan will form the pricing for the Individual Hotel Design Agreement which was based on the prevailing market prices and shall not, from the Group's perspective, be less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third party for hotels of equivalent or similar grading. We have obtained the draft Individual Hotel Design Agreements for the Selected Projects and noted the pricing terms thereon align with the Hotel Development Plan. We note that unit prices of the 15 hotel/conference property projects vary and are made up of conference centres/six- star hotels, five-star hotels and four-star hotels. We have obtained from the Management nine agreements entered into between the Company and independent third parties for the provision of Hotel Design Services to hotels of equivalent or similar grading (the "Hotel Design Comparables"). In view of: (i) the Hotel Design Comparables represent all the equivalent gradings of hotels and conference centres which compared to the Selected Projects; and (ii) the sample size of the Hotel Design Comparables (i.e. nine) outnumbers the sample size of the Selected Projects (i.e. six), we are of the view that sample size of the Hotel Design Comparables is sufficient, fair and representative.

We noted that the unit prices of Hotel Design Services per sq. m. in seven Hotel Design Comparables are identical to those under the draft Individual Hotel Design Agreements for the Selected Projects for hotels of the equivalent grading and conference centres and the unit prices of Hotel Design Services per sq. m. in the remaining two Hotel Design Comparables are less than those under the draft Individual Hotel Design Agreements for the Selected Projects for hotels of the equivalent grading and conference centres. As such, the pricing term of the draft Individual Hotel Design Agreements are no less favourable than those under the Hotel Design Comparables. The payment terms under the draft Individual Hotel Design Agreements for the Selected Projects are also no less favourable to those for the Hotel Design Comparables for hotels of the equivalent grading and conference centres in terms of the payment period.

We further note the protective mechanism to the Group set out in the pricing policy of the Hotel Design Framework Agreement which states that if the Group, in the future, is of the view that the service fees and contractual terms under the Hotel Design Framework Agreement are, from the Group's perspective, less favourable than those provided by the Group to independent third parties, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Design Framework Agreement to ensure that each new Individual Hotel Design Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties.

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Letter from Opus Capital Limited

Based on the above, and in particular, the Group will ensure that each new Individual Hotel Design Agreement will be on terms no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties and taking into consideration the internal control procedures adopted by the Company as described under the section below, we consider that the terms of the Hotel Design Framework Agreement to be fair and reasonable as far as the Independent Shareholders are concerned.

4. Principal terms of the Hotel Construction Management Framework Agreement

A summary of the principal terms of the Hotel Construction Management Framework Agreement is set out as follows:

Date	:	18 October 2019
Parties	:	(i) Dalian Wanda Group, a controlling shareholder of the
		Company as at the Latest Practicable Date
		(ii) The Company
Term	:	From the day on which Independent Shareholders' approval
		in respect of the Hotel Construction Management Framework
		Agreement is obtained at the SGM to 31 December 2021
Services	:	Pursuant to the Hotel Construction Management Framework
		Agreement, Dalian Wanda Group and/or its subsidiaries may
		from time to time engage the Group, including Wanda Hotel
		Management (HK), to provide hotel construction management
		services. For the avoidance of doubt, such services do not
		include project design, construction and supervision work, in
		respect of which Dalian Wanda Group should hire relevant
		professional advisory body(ies) and be responsible for such
		expenses.
		Dalian Wanda Group and/or its subsidiaries and the Group
		shall enter into separate agreements (the "Individual Hotel
		Construction Management Agreement(s)") in relation
		to the provision of hotel construction management services
		for relevant projects, which shall be subject to the terms
		and conditions under the Hotel Construction Management
		Framework Agreement and the annual caps thereunder. The
		duration of each Individual Hotel Construction Management
		Agreement shall not exceed the term of the Hotel Construction
		Management Framework Agreement and the terms of the
		Individual Hotel Construction Management Agreements shall
		be made on normal commercial terms.

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Letter from Opus Capital Limited

Service fees and :	The service fees payable by Dalian Wanda Group to the Group
pricing policy	for the hotel construction management services for each
	hotel shall be fair and reasonable and the consultation and
	hotel construction management service fees for each project
	are charged according to the project area and such fee shall
	not exceed RMB136 per sq. m.. The ceiling of the unit
	price of RMB136 per sq. m. is higher than the current unit
	price charged by the Group to independent third parties for
	equivalent or similar services, and was determined after taking
	into account historical unit price charged by the WHMHK
	Group to Dalian Wanda Group and possible inflation during
	the term of the Hotel Construction Management Services
	Framework Agreement. The service fee for each project shall
	be determined after arm's length negotiations based on normal
	commercial terms with reference to the prevailing market
	prices by taking into account the fee charged by the Group
	to independent third party for equivalent or similar services.
	The fee charged by the Company shall not, from the Group's
	perspective, be less favourable than the rates charged and terms
	for equivalent or similar services provided by the Group to
	independent third party.
	In order to ensure that the terms of the Individual Hotel
	Construction Management Agreements shall be made on
	normal commercial terms or better, the actual service fees
	rates for each Individual Hotel Construction Management
	Agreement shall be determined with reference to the prices and
	terms provided by the Group to independent third parties for
	similar services.
	In order to ensure that the terms of the Individual Hotel
	Construction Management Agreements signed on or after
	the date of the Hotel Construction Management Framework
	Agreement are and will be made on normal commercial terms,
	the Group will establish a review mechanism to monitor the
	prevailing service fees and contractual terms for equivalent
	or similar services in the market and approve in advance the
	terms of each Individual Hotel Construction Management
	Agreement signed on or after the date of the Hotel Construction
	Management Framework Agreement to ensure that its actual
	service fees rates and contractual terms shall not, from the
	Group's perspective, be less favourable than the rates charged
	and terms for equivalent or similar services provided by the
	Group to independent third party.

- 49 -

Letter from Opus Capital Limited

Under the proposed review mechanism to be established, the Company will, prior to the signing of each of the Individual Hotel Construction Management Agreements, designate members of the management in its finance and compliance team to review each of such agreements by comparing their terms against the terms for equivalent or similar services provided by the Group to independent third parties. Once the designated members determine, after arm's length negotiations, that the terms of the Individual Hotel Construction Management Agreement are on normal commercial terms or better, the agreement will be approved by such designated members for signing. The review mechanism is intended to ensure that the terms of each Individual Hotel Construction Management Agreement will be entered into after arm's length negotiations based on normal commercial terms. If in the future the Group is of the view that the service fees and contractual terms fixed under the Hotel Construction Management Framework Agreement are, from the Group's perspective, less favourable than that provided by the Group to independent third parties at the time, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Construction Management Framework Agreement to ensure that each new Individual Hotel Construction Management Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties in hotels of equivalent or similar grading during the same period. If the rates charged and terms for equivalent or similar services provided by the Group to Dalian Wanda Group becomes less favourable than that provided by the Group to independent third parties, signifying a deviation from the terms of the Hotel Construction Management Framework Agreement, the Company will re-comply with the Listing Rules requirements if applicable.

- 50 -

Letter from Opus Capital Limited

As set out in the Letter from the Board and for reference purpose, the following table sets out the income of WHMHK Group, which became subsidiaries of the Company in December 2018, that are principally engaged in provision of hotel management (including hotel design and hotel construction management) services as at the Latest Practicable Date, generated from providing hotel construction management services to Dalian Wanda Group for each of the two years ended 31 December 2017 and 2018 and for the 10 months ended 31 October 2019:

			10 months
			ended
			31 October
	FY2017	FY2018	2019
	(Note)	(Note)
Historical figures	3.03	5.32	0.54

		(HKD'million)
		Note: Figures as extracted from the 2018 Annual Report
Annual caps	:	The annual caps of the maximum aggregate amounts payable
		by Dalian Wanda Group for each of the three years ending
		31 December 2021 for the provision of hotel construction
		management services by the Group are set out below:
			Year ending 31 December
			2019	2020	2021
		Annual caps	10.87	31.69	25.12

(RMB million)

The annual caps in respect of the transactions contemplated under the Hotel Construction Management Framework Agreement are arrived at after taking into consideration of, among others, (i) the anticipated demand for hotel construction management services by Dalian Wanda Group based on the current development plan of the existing hotel projects of Dalian Wanda Group and on the assumption that Dalian Wanda Group will continue to develop the existing property projects, with reference to the expected business commencement dates of the hotel projects, payment terms, anticipated GFA of the hotel projects and unit price of the hotel construction management services; (ii) the prevailing market prices for the

- 51 -

Letter from Opus Capital Limited

relevant hotel construction management services; and (iii) a buffer of 25% taking into account, among others, (a) the inflation expected during the term of the Hotel Construction Management Framework Agreement (taking into account the average historical inflation rate in China in 2016, 2017 and 2018 of approximately 1.9% and the historical inflation rate in China in the first eight months of 2019 of approximately 2.4%); (b) a potential fluctuation in the annual caps of over 20% in each year during the term of the Hotel Construction Management Framework Agreement considering the potential additional demand for hotel construction consulting services by Dalian Wanda Group during the term of the Hotel Construction Management Framework Agreement; and (c) the possibility of early or delay in revenue recognition due to the progress of hotel project construction consulting services during the term of the Hotel Construction Management Framework Agreement and the possibility of securing new agreements for provision of hotel construction management services. The annual caps are arrived at after taking into account the above factors and the fluctuation in the annual caps is mainly affected by the expected percentage of completion of work of each hotel project in the current development plan of Dalian Wanda Group during the 3 years ending 31 December 2021 and the estimated number of hotel projects completing in each of the years ending 31 December 2020 and 2021 and 6 months ending 30 June 2022, for which hotel construction management services in the years prior to completion would be required.

We have reviewed the Hotel Construction Management Framework Agreement and note that the pricing terms of the service fees payable by Dalian Wanda Group to the Group for the hotel construction management services will be determined on the basis as mentioned above. As discussed above, we have obtained the Hotel Development Plan from the Management and based on the Selected Projects, we have also obtained six corresponding Individual Hotel Construction Management Agreements, the pricing of which as we understood shall be fair and reasonable since the consultation and hotel construction management service fees for each project shall be charged according to the project area and such fee shall not exceed RMB136 per sq. m.. In view of: (i) the six Selected Projects' Individual Hotel Construction Management Agreements include all the gradings of hotels and conference centres laid out in the Hotel Development Plan; and (ii) the aggregate contract amount of the Selected Projects for the provision of hotel construction management services, in our opinion, provided sufficient coverage which accounts for over 40% of the total contract sum under the Hotel Development Plan, we are of the view that the sample size of the Selected Projects is sufficient, fair and representative for the purpose of our analysis.

- 52 -

Letter from Opus Capital Limited

Based on our review of the Hotel Development Plan, all of the projects' construction management service fees are set at RMB136 per sq. m.. Given there is only one unit price of RMB136 per sq.m. across all of the projects under the Hotel Development Plan, we have obtained from the Management four agreements entered into between the Company and independent third parties for the provision of hotel construction management services to hotels of equivalent or similar grading (the "Hotel Construction Management Comparables"). In view of: (i) there is lack of fee differential across the various projects involving the provision of construction management services where all of the projects' construction management service fees are set at RMB136 per sq. m., we are essentially comparing one and only unit price of RMB136 per sq. m. with four other unit prices under the Hotel Construction Management Comparables; and (ii) the four Hotel Construction Management Comparables covered approximately one-third of the total number of cities in the PRC in which the Company provided hotel construction management services to hotels of equivalent or similar grading to independent third parties, we are of the view that sample size of the Hotel Construction Management Comparables to be sufficient, fair and representative.

We noted that the unit price of RMB136 per sq. m. of hotel construction management services under the draft Individual Hotel Construction Management Agreements for the Selected Projects is higher than the unit prices under the Hotel Construction Management Comparables. As such, we are of the view that the unit price of hotel construction management services per sq. m. under the draft Individual Hotel Construction Management Agreements for the Selected Projects are no less favourable than those under the Hotel Construction Management Comparables.

We further note the protective mechanism to the Group set out in the pricing policy of the Hotel Construction Management Framework Agreement which states that if the Group in the future is of the view that the service fees and contractual terms under the Hotel Construction Management Framework Agreement are, from the Group's perspective, less favourable than those provided by the Group to independent third parties, the Group will use its best endeavours to negotiate revised service fees and contractual terms with Dalian Wanda Group under the Hotel Construction Management Framework Agreement to ensure that each new Individual Hotel Construction Management Agreement to be entered into at the time will be no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties.

Based on the above, and in particular that the Group will ensure that each new Individual Hotel Construction Management Agreement will be on terms no less favourable than the rates charged and terms for equivalent or similar services provided by the Group to independent third parties and taking into consideration the internal control procedures adopted by the Company under the section below, we consider that the terms of the Hotel Construction Management Framework Agreement to be fair and reasonable as far as the Independent Shareholders are concerned.

- 53 -

Letter from Opus Capital Limited

5. Internal control procedures

In order to safeguard the interests of the Company and the Shareholders as a whole, the Company has adopted certain measures in monitoring the transactions under the Framework Agreements including the following, for as long as the transactions constitute continuing connected transactions of the Company:

1. the legal department of the Company is responsible for the review of any Individual Hotel Design Agreement and Individual Hotel Construction Management Agreement to ensure that the terms thereunder are made in accordance with the terms and conditions (including the pricing policies) of the Hotel Design Framework Agreement and the Hotel Construction Management Framework Agreement, respectively;
2. the Company has designated members of the management in the finance and compliance department of the Company to closely monitor subsisting and potential connected transactions of the Group on a regular basis of no less frequent than every quarter and will review the transactions under the Framework Agreements with Dalian Wanda Group and its subsidiaries to identify any continuing connected transaction that may be at risk of exceeding the annual caps so as to ensure that relevant Listing Rules requirements have been re-complied before any annual cap is being exceeded; and
3. the Company will report any Individual Hotel Design Agreement and Individual Hotel Construction Management Agreement to the independent non-executive Directors for their review during each of the audit committee meetings according to the audit committee meeting agenda. The Company shall ensure that such kind of reporting shall be conducted not less than twice a year.

As part of our due diligence, we have obtained and reviewed the Group's internal control policy memo regarding certain measures in monitoring the transactions under the Framework Agreements. It was noted that any transaction contemplated under each of the Individual Hotel Design Agreement and the Individual Hotel Construction Management Agreement will be reviewed by the legal department of the Company to ensure the terms of which shall be in accordance with the Hotel Design Framework Agreement and the Hotel Construction Management Framework Agreement respectively. We also note that finance and compliance departments of the Company will be responsible for monitoring subsisting and potential connected transactions of the Group for the risk of exceeding the annual caps and ensure the relevant Listing Rules requirements have been re-complied before any annual cap is being exceeded. Further, the Company will also ensure that any transactions contemplated under the Individual Hotel Design Agreement and the Individual Hotel Construction Management Agreement will be conducted on terms that are fair and reasonable and the service fee will be no less favourable to the Group than the rates charged and terms for equivalent or similar services provided by the Group to independent third party. The aforementioned internal control measures will enable the Group to safeguard the interest of the Company and the Shareholders as a whole.

- 54 -

Letter from Opus Capital Limited

Annual Caps

1. Hotel Design Framework Agreement
   Set out below are the annual caps for the Hotel Design Framework Agreement during the three years ending 31 December 2019, 2020 and 2021 (the "Relevant Period") respectively:

	For the year ending 31 December
	2019	2020	2021
	RMB million	RMB million	RMB million
Annual caps	52.34	92.45	70.92

As stated in the Letter from the Board, the annual caps in respect of the transactions contemplated under the Hotel Design Framework Agreement were determined by reference to a number of factors, particularly:

1. the anticipated demand for Hotel Design Services by Dalian Wanda Group based on the current development plan of the existing property projects of Dalian Wanda Group;
2. the prevailing market prices for the relevant design services; and
3. a buffer of 25% taking into account, among others:
4. 1. the inflation expected during the term of the Hotel Design Framework
      Agreement;
   2. the potential additional demand for Hotel Design Services by Dalian Wanda Group during the term of the Hotel Design Framework Agreement; and
   3. the possibility of early or delay in revenue recognition due to the progress of Hotel Design Services during the term of the Hotel Design Framework Agreement.

We understand from the Management that the Group did not enter into any agreement with Dalian Wanda Group for the provision of Hotel Design Services prior to the entering into of the Hotel Design Framework Agreement.

We understand that the annual caps calculations are based on the information of the 15 projects set out under the Hotel Development Plan. To assess the fairness and reasonableness of the annual caps, we have conducted the following review of the Hotel Development Plan as follows:

- 55 -

Letter from Opus Capital Limited

1. The expected business commencement dates
   As shown in the Hotel Development Plan, all the 15 projects are expected to commence business from 2020 to 2022. The expected business commencement date of each project is applied to the allocation of the expected annual revenue to be generated from the corresponding project across each year during the Relevant Period which in turn impacts on the calculation of the annual caps for the relevant year.
   We have obtained the hotel opening plan of Dalian Wanda Group named "萬達酒店2019-2022開業計劃" (the "Hotel Opening Plan") from the Management regarding the approved official commencement dates of 15 projects under the Hotel Development Plan. According to the Hotel Opening Plan, the expected commencement dates of all the 15 projects regarding the provision of Hotel Design Services are consistent with those in the Hotel Development Plan. For the 6 Selected Projects, three are expected to commence business in 2020, one is expected to commence business in 2021 and two are expected to commence business in 2022. We have obtained the corresponding draft Individual Hotel Design Agreements (the "Selected Hotel Design Agreements") for each of the Selected Projects and note that the expected business commencement dates as shown in the Selected Hotel Design Agreements are the same as those set out in the Hotel Development Plan.
   Based on the above, we considered that the expected business commencement dates in the Hotel Development Plan applied to the calculations of the annual caps to be reasonable.
2. The GFA
   We understand that the GFA of each project in the Hotel Development Plan was applied to the unit prices (which will be discussed below) for the calculations of the annual caps. As shown in the Selected Hotel Design Agreements, the GFA of the corresponding project aligns with those set out in the Hotel Development Plan.
   Based on the above, we considered that the GFA applied to the calculations of the annual caps to be reasonable.

- 56 -

Letter from Opus Capital Limited

1. The unit prices
   For the Selected Projects, there are one six-star hotel, two conference centres, one five-star hotel and one four-star hotel and we understand the unit prices for Hotel Design Services would vary in accordance with the hotel grading. We have obtained and reviewed 9 agreements of the provision relating to the Hotel Design Services entered into between the Company and independent third parties (i.e. the Hotel Design Comparables) and note that the unit prices in the Hotel Design Comparables were identical to and less than those in the Selected Hotel Design Agreements.
   Based on the above, we considered that the unit prices applied to the calculations of the annual caps to be reasonable.
2. The contract sum and the allocation basis
   For the provision of Hotel Design Services, the contract sum of each project in the Hotel Development Plan is calculated by multiplying the corresponding GFA and the unit price. We understand that the Management allocated the contract sum of each project to each year of the Relevant Period by referring to the expected percentage of completion of work of the corresponding project during the Relevant Period. We have obtained the information regarding the expected percentage of completion of work for the 15 projects and we noted that it was applied in the Hotel Development Plan for allocating the contract sum of each hotel design project to each year of the Relevant Period. Further, we also noted that less than 20% of the expected percentage of completion of work is allocated to the year of commencement of most of the projects while more than 80% of the expected percentage of completion of work is allocated to the 2-year period prior to the year of commencement of most of the projects.
   Based on the above, we considered that the allocation basis applied to the calculations of the annual caps to be reasonable.

- 57 -

Letter from Opus Capital Limited

1. The estimated buffer to the gross transaction amounts
   We understand that a 25% buffer was applied to the calculations of the annual caps. We have considered, among others, in particular the following:
2. 1. the historical annual inflation rate in China in 2016, 2017, 2018 were approximately 2.0%, 1.6% and 2.1% respectively with an average of approximately 1.9%. The inflation rate in China in the first eight months of 2019 was approximately 2.4%; and
   2. the fluctuation in the annual caps during the Relevant Period which first increased from approximately RMB52.3 million in 2019 to approximately RMB92.5 million in 2020, representing an increase of over 75% and decreased to approximately RMB70.9 million in 2021, representing a decrease of over 20%.

It is noted that the annual caps fluctuate over 20% in each year during the Relevant Period since the nature of the revenue recognition is based on the expected percentage of completion of work. It is not uncommon for hotel design projects to complete prior to or later than the target completion date due to the progress of the overall hotel construction. As such, there will be a possibility of early or delay in revenue recognition which will affect the amount of annual cap in the corresponding year. Further, there is also a possibility of securing new agreements for the provision of Hotel Design Services.

Based on the above, in particular that: (i) a historical average annual inflation rate of approximately 1.9% in 2016, 2017 and 2018 and approximately 2.4% for the first eight months in 2019 in China; (ii) a fluctuation of over 20% in the annual caps during the Relevant Period; (iii) a possibility of early or delay in revenue recognition; and (iv) a possibility of securing new agreements for the provision of Hotel Design Services, we are of the view that a 25% buffer applied to the calculations of the annual caps to be reasonable.

- 58 -

Letter from Opus Capital Limited

1. Hotel Construction Management Framework Agreement
   Set out below are the annual caps for the Hotel Construction Management Framework Agreement during the Relevant Period:

	For the year ending 31 December
	2019	2020	2021
	RMB million	RMB million	RMB million
Annual caps	10.87	31.69	25.12

As stated in the Letter from the Board, the annual caps in respect of the transactions contemplated under the Hotel Construction Management Framework Agreement were determined by reference to a number of factors, particularly:

1. the anticipated demand for hotel construction management services by Dalian Wanda Group based on the current development plan of the existing hotel projects of Dalian Wanda Group;
2. the prevailing market prices for the relevant hotel construction management services; and
3. a buffer of 25% taking into account, among others:
4. 1. the inflation expected during the term of the Hotel Construction Management Framework Agreement;
   2. the potential additional demand for hotel construction consulting services by Dalian Wanda Group during the term of the Hotel Construction Management Framework Agreement; and
   3. the possibility of early or delay in revenue recognition due to the progress of hotel project construction consulting services during the term of the Hotel Construction Management Framework Agreement.

We understand from the Management that the Group did not enter into any agreement with Dalian Wanda Group for the provision of hotel construction management services prior to the entering into of the Hotel Construction Management Framework Agreement.

We understand that the annual caps calculations are based on the information of the 15 projects set out under the Hotel Development Plan. To assess the fairness and reasonableness of the annual caps, we have conducted the following review of the Hotel Development Plan as follows:

- 59 -

Letter from Opus Capital Limited

1. The expected business commencement dates
   As discussed in the paragraph headed "(i) The expected business commencement dates" for the annual caps under the Hotel Design Framework Agreement, we have obtained the Hotel Opening Plan from the Management regarding the approved official commencement dates of 15 projects under the Hotel Development Plan. According to the Hotel Opening Plan, the expected commencement dates of all the 15 projects regarding the provision of hotel construction management services are consistent with those in the Hotel Development Plan. For the Selected Projects, three are expected to commence business in 2020, one is expected to commence business in 2021 and two are expected to commence business in 2022. We have obtained the corresponding draft Individual Hotel Construction Management Agreements (the "Selected Hotel Construction Management Agreements") for each of the Selected Projects and note that the expected business commencement dates as shown in the Selected Hotel Construction Management Agreements are the same as those set out in the Hotel Development Plan.
   Based on the above, we considered that the expected business commencement dates in the Hotel Development Plan applied to the calculations of the annual caps to be reasonable.
2. The GFA
   Similar to the calculations of the annual caps under the Hotel Design Framework Agreement, we understand that the GFA of each project in the Hotel Development Plan was applied to the unit prices (which will be discussed below) for the calculations of the annual caps under the Hotel Construction Management Framework Agreement. As shown in the Selected Hotel Construction Management Agreements, the GFA of the corresponding project aligns with those set out in the Hotel Development Plan.
   Based on the above, we considered that the GFA applied to the calculations of the annual caps to be reasonable.

- 60 -

Letter from Opus Capital Limited

1. The unit prices
   We understand from the Management that a single unit price of RMB136 per sq. m. was applied to the calculations of the annual caps for all grades of hotels and conference centres. We have also obtained and reviewed 4 agreements for the provision of hotel construction management services entered into between the Company and independent third parties (i.e. the Hotel Construction Management Comparables) which included various grades of hotels and conference centres. We noted that a single unit price of RMB100 per sq. m. was adopted in the Hotel Construction Management Comparables which was less than the unit price stated in the Hotel Construction Management Framework Agreement.

Based on the above, we considered that the unit price applied to the calculations of the annual caps to be reasonable.

1. The contract sum and the allocation basis
   For the provision of hotel construction management services, the contract sum of each project in the Hotel Development Plan is calculated by multiplying the corresponding GFA and the unit price of RMB136 per sq. m.. We understand that the Management allocated the contract sum of each project to each year of the Relevant Period, by referring to the expected percentage of completion work of the corresponding project during the Relevant Period. As mentioned above, we have obtained the information regarding the expected percentage of completion of work for the 15 projects and we noted that it was applied in the Hotel Development Plan for allocating the contract sum of each hotel construction management project to each year of the Relevant Period. Further, we also noted that approximately 30% of the expected percentage of completion of work is allocated to the year of commencement of most of the projects while approximately 70% of the expected percentage of completion of work is allocated to the 2-year period prior to the year of commencement of most of the projects.
   Based on the above, we considered that the allocation basis applied to the calculations of the annual caps to be reasonable.

- 61 -

Letter from Opus Capital Limited

1. The estimated buffer to the gross transaction amounts
   We understand that a 25% buffer was applied to the calculations of the annual caps. We have considered, among others, in particular the following:
2. 1. the historical annual inflation rate in China in 2016, 2017, 2018 were approximately 2.0%, 1.6% and 2.1% respectively with an average of approximately 1.9% and the inflation rate in China in the first eight months in 2019 was approximately 2.4%; and
   2. the fluctuation in the annual caps during the Relevant Period which first increased from approximately RMB10.9 million in 2019 to approximately RMB31.7 million in 2020, representing an increase of over 190% and decreased to approximately RMB25.1 million in 2021, representing a decrease of over 20%.

It is noted that the annual caps fluctuate over 20% in each year during the Relevant Period since the nature of the revenue recognition is based on the expected percentage of work completion. It is not uncommon for the progress of the overall hotel construction to not align with the stipulated construction schedule. As such, there will be a possibility of early or delay in revenue recognition which will affect the amount of annual caps in the corresponding year. Further, there is also a possibility of securing new agreements for the provision of hotel construction management services.

Based on the above, in particular that: (i) a historical average annual inflation rate of approximately 1.9% in 2016, 2017 and 2018 and approximately 2.4% for the first eight months in 2019 in China; (ii) a fluctuation of over 20% in the annual caps during the Relevant Period; (iii) a possibility of early or delay in revenue recognition; and (iv) a possibility of securing new agreements for the provision of hotel construction management services, we are of the view that a 25% buffer applied to the calculations of the annual caps to be reasonable.

Having considered the bases on which the annual caps of the Framework Agreements were determined as described above, we are of the view that the annual caps are fair and reasonable as far as the Independent Shareholders are concerned.

- 62 -

Letter from Opus Capital Limited

OPINION AND RECOMMENDATION

1. THE PROPOSED ASSIGNMENTS
   In view of the above principal factors and reasons, we considered that:
2. 1. the terms of the Proposed Assignments are on better terms to the Company and fair and reasonable so far as the Independent Shareholders are concerned; and
   2. though the entering into of the Proposed Assignments is not in the ordinary and usual course of business of the Group, it is in the interests of the Company and the Shareholders as a whole.

We, therefore, recommend the Independent Board Committee to recommend, and we ourselves recommend, the Independent Shareholders to vote in favour of the relevant resolution(s) to be proposed at the SGM in relation to the Proposed Assignments.

1. THE FRAMEWORK AGREEMENTS
   In view of the above principal factors and reasons, we considered that:
2. 1. the entering into of the Framework Agreements is in the ordinary and usual course of business of the Group and is in the interests of the Company and the Shareholders as a whole; and
   2. the terms of the Framework Assignments (including the annual caps) are on normal commercial terms and fair and reasonable so far as the Independent Shareholders are concerned.

We, therefore, recommend the Independent Board Committee to recommend, and we ourselves recommend, the Independent Shareholders to vote in favour of the relevant resolution(s) to be proposed at the SGM in relation to the Framework Agreements (including the annual caps).

	Yours faithfully,
	For and on behalf of
	Opus Capital Limited
Koh Kwai Yim	Cheung On Kit Andrew
Managing Director	Director

Ms. Koh Kwai Yim is the Managing Director of Opus Capital and is licensed under the SFO as a Responsible Officer to conduct Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities. Ms. Koh has over 17 years of corporate finance experience in Asia and has participated in and completed various financial advisory and independent financial advisory transactions.

Mr. Cheung On Kit Andrew is a Director of Opus Capital and is licensed under the SFO as a Responsible Officer to conduct Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities. Mr. Cheung has approximately 12 years of corporate finance experience in Asia Pacific and has participated in and completed various financial advisory and independent financial advisory transactions.

- 63 -

APPENDIX I	FINANCIAL information of the group

1. FINANCIAL INFORMATION OF THE GROUP
   Financial information of the Group for each of the three years ended 31 December 2017 and 2018 and financial information of the Group for the six months ended 30 June 2019 were set out in the relevant annual reports and interim report of the Company posted on the websites of the Stock Exchange (http://www.hkex.com.hk) and the Company (http://www.wanda-hotel. com.hk). Please also see below quick links to the relevant annual reports:-
   The consolidated financial statements of the Group for the year ended 31 December 2017 (pages 98 - 258) (https://www1.hkexnews.hk/listedco/listconews/sehk/2018/0426/ ltn201804261394.pdf)
   The consolidated financial statements of the Group for the year ended 31 December 2018 (pages 100 - 295) (https://www1.hkexnews.hk/listedco/listconews/sehk/2019/0425/ ltn201904251268.pdf)
   The interim condensed consolidated financial information of the Group for the six months ended 30 June 2019 (pages 27 - 84) (https://www1.hkexnews.hk/listedco/listconews/ sehk/2019/0925/ltn20190925119.pdf)
   Each of the said consolidated financial statements of the Group is incorporated by reference to this Circular and forms part of this Circular.
2. INDEBTEDNESS STATEMENT
3. 1. Borrowings
      At the close of business on 30 September 2019, being the latest practicable date for the purpose of this indebtedness statement prior to printing of this Circular, the Group had secured and guaranteed interest-bearing borrowings from financial institutions of approximately HK$1,146.1 million. These borrowings are denominated in RMB and USD.
      As at 30 September 2019, the Group had outstanding unguaranteed interest-bearing borrowings from an entity controlled by Mr. Chen Chang Wei ("Mr. Chen"), a former director of the Company, and Mr. Chen. Certain loans from an entity controlled by Mr. Chen amounting to HK$12.5 million that bear interest at 15% per annum are unsecured and the interest generated for the period from 1 April 2016 to 30 September 2019 has been waived by the lender. Certain loans from Mr. Chen amounting to HK$508.5 million that bear interest at 10% per annum are unsecured.
      Further, as at 30 September 2019, the Group had outstanding unsecured and unguaranteed borrowings from an intermediate holding company of approximately HK$4,846.8 million. Among such borrowings from the intermediate holding company, approximately HK$927.9 million are interest-free borrowings and approximately HK$3,918.9 million are interest-bearing borrowings.

- I-1 -

APPENDIX I	FINANCIAL information of the group

As at 30 September 2019, the Group had outstanding interest-free advances from an intermediate holding company of HK$0.2 million. These amounts are unsecured and unguaranteed.

1. 1. Lease liabilities
      The Group leases certain of its properties under operating lease arrangements. Lease for properties are negotiated for terms of one to twenty years. As at 30 September 2019, the Group's total lease liabilities recognised under Hong Kong Financial Reporting Standards 16 under non-cancellable operating lease contracts is HK$190 million.
   2. Contingent liabilities
      As at 30 September 2019, the Group had provided guarantees in aggregate amount of approximately HK$246.2 million to certain banks in favour of its customers in respect of mortgaged loans provided by the banks to these customers for their purchase of the Group's properties. Each of these guarantees would be released upon the execution of individual purchasers' collateral agreements.
      Save as disclosed above and apart from intra-group liabilities, the Group did not have any outstanding mortgages, charges, debt securities, term loans and overdrafts, hire purchase commitments, liabilities under acceptances (other than normal trade bills) or acceptance credits, other borrowings or indebtedness in the nature of borrowings or any guarantees or other material contingent liabilities as at the close of business on 30 September 2019.
2. WORKING CAPITAL
3. 
   As at 30 September 2019, the Group had cash and bank balance of approximately HK$1,840.4 million. The Directors, after due and careful consideration, are of the opinion that, after taking into consideration the financial resources available to the Group, including internally generated funds, the Group will have sufficient working capital for its requirements for at least 12 months from the date of publication of this Circular.
4. FINANCIAL AND TRADING PROSPECTS OF THE GROUP
5. 1. 
      As stated in the Company's latest interim report, the Group's strategies are to focus on fee based businesses, to improve cash flow, and to reduce leverage, which includes the initiatives to (i) continue to monetize prior property investments; (ii) capitalize on the hotel management expertise of the Company (e.g. hotel design, construction and operation management, etc.) where the Group can potentially develop into an industry leader in the segment in China; and
   2. improve the operating efficiency of Hengli City and the Guilin Project through cost control and targeted marketing, while at the same time evaluate future plans regarding these two assets. The Group will continue to prudently seek profitable investment opportunities, further expand the Group's sources of revenue, enhance the Group's profitability and maximize return for its shareholders.

- I-2 -

APPENDIX II	GENERAL information

1. RESPONSIBILITY STATEMENT
   This Circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Group. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this Circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this Circular misleading.
2. DISCLOSURE OF INTERESTS
   Directors' and chief executive's interests and short positions in shares, underlying shares and debentures
   Save as disclosed below, as at the Latest Practicable Date, none of the Directors and chief executive of the Company had any interests or short positions in any shares, underlying shares and debentures of the Company and its associated corporations (within the meaning of Part XV to the SFO) which (a) have been notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which the Directors and chief executive of the Company were taken or deemed to have under such provisions of SFO); or (b) have been entered in the register maintained by the Company pursuant to Section 352 of the SFO; or (c) have been notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers.
   Interests in the shares of DWCM Group (Note 1)

				Approximate
			Interest in shares	percentage (%)
	Long		and underlying	of the issued share
	position/short	Capacity/Nature	shares of DWCM	capital of
Name of Directors	position	of interest	Group	DWCM Group
Mr. Ding Benxi	Long	Beneficial owner	100,000,000	2.21%
Mr. Ning Qifeng	Long	Beneficial owner	6,000,000	0.13%
Mr. Zhang Lin	Long	Beneficial owner	10,000,000	0.22%
Mr. Han Xu	Long	Beneficial owner	1,600,000	0.035%
Mr. He Zhiping	Long	Beneficial owner	25,000,000	0.55%

- II-1 -

APPENDIX II	GENERAL information

Notes:

1. DWCM Group, being an indirect holding company of the Company, is an associated company of the Company under Part XV of the SFO. The calculation is based on the total number of 4,527,347,600 shares in issue as at the Latest Practicable Date.

3. SUBSTANTIAL SHAREHOLDERS' INTERESTS AND SHORT POSITIONS IN SHARES AND UNDERLYING SHARES

As at the Latest Practicable Date, so far as was known to the Company, the following persons (other than the Directors and chief executive of the Company) had interests or short positions in the Shares and underlying Shares which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or were, directly or indirectly, interested in 5% or more of the nominal value of any class of share capital carrying rights to vote in all circumstances at general meetings of any member of the Group were as follows:

				Approximate
			Interest in shares	percentage of the
	Long		and underlying	issued share
	position/short	Capacity/nature	shares of the	capital of
Name	position	of interest	Company	the Company
Wanda Overseas	Long	Beneficial owner	3,055,043,100	65.04%
Wanda Real Estate	Long	Interest in controlled	3,055,043,100	65.04%
Investments Limited		corporation (Note 1)
Wanda HK	Long	Interest in controlled	3,055,043,100	65.04%
		corporation (Note 2)
DWCM Group	Long	Interest in controlled	3,055,043,100	65.04%
		corporation (Note 3)
Dalian Wanda Group	Long	Interest in controlled	3,055,043,100	65.04%
		corporation (Note 4)
Dalian Hexing	Long	Interest in controlled	3,055,043,100	65.04%
Investment Co., Ltd.		corporation (Note 5)
Mr. Wang Jianlin	Long	Interest in controlled	3,055,043,100	65.04%
		corporation (Note 6)

- II-2 -

APPENDIX II			GENERAL information
				Approximate
			Interest in shares	percentage of the
	Long		and underlying	issued share
	position/short	Capacity/nature	shares of the	capital of
Name	position	of interest	Company	the Company
Mr. Chen Chang Wei	Long	Beneficial owner and	278,098,230	5.92%
		interest held by
		controlled
		corporation (Note 7)
	Long	Interest of spouse	23,600,000	0.50%
		(Notes 7 and 8)
Ms. Chan Sheung Ni	Long	Beneficial owner	23,600,000	0.50%
	Long	Interest of spouse	278,098,230	5.92%
		(Note 9)
Ever Good Luck	Long	Beneficial owner	73,860,230	1.57%
Limited (Note 10)	Long	Trustee	204,237,800	4.35%

Notes:

1. Wanda Real Estate Investments Limited holds more than one-third of the issued shares of Wanda Overseas and is therefore deemed to have an interest in the shares and underlying shares of the Company in which Wanda Overseas is interested.
2. Wanda HK holds more than one-third of the issued shares of Wanda Real Estate Investments Limited and is therefore deemed to have an interest in the shares and underlying shares of the Company in which Wanda Real Estate Investments Limited is deemed to be interested. Mr. Ding Benxi, being a non-executive Director and Chairman of the Board, is a director of Wanda HK.
3. DWCM Group holds more than one-third of the issued shares of Wanda HK and is therefore deemed to have an interest in the shares and underlying shares of the Company in which Wanda HK is deemed to be interested. Mr. Ding Benxi, being a Non-executive Director and the Chairman of the Board, is an executive director and the chairman of the board of directors of DWCM Group. Mr. Ning Qifeng, being an Executive Director, was a senior vice president of DWCM Group from June 2015 to July 2017, and has been a first vice president since March 2019.
4. Dalian Wanda Group holds more than one-third of the issued shares of DWCM Group and is therefore deemed to have an interest in the shares and underlying shares of the Company in which DWCM Group is deemed to be interested. Mr. Ding Benxi, being a Non-executive Director and the Chairman of the Board, is a director and president of Dalian Wanda Group. Mr. Zhang Lin, being a Non-executive Director, is a director of Dalian Wanda Group.

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APPENDIX II	GENERAL information

1. Dalian Hexing holds more than one-third of the issued shares of Dalian Wanda Group and is therefore deemed to have an interest in the shares and underlying shares of the Company in which Dalian Wanda Group is deemed to be interested.
2. Mr. Wang Jianlin holds more than one-third of the issued shares of Dalian Hexing and is therefore deemed to have an interest in the shares and underlying shares of the Company in which Dalian Hexing is deemed to be interested.
3. As at the Latest Practicable Date, Mr. Chen was deemed to have a long position of 301,698,230 shares, of which (i) 200 shares were beneficially and legally owned by him, (ii) 204,237,800 shares were held on trust for him by Ever Good Luck Limited, (iii) 73,860,230 shares were beneficially owned by Ever Good Luck Limited, and (iv) 23,600,000 shares were held by his spouse, Ms. Chan Sheung Ni, as beneficial owner.
4. Ms. Chan Sheung Ni is the spouse of Mr. Chen.
5. Ms. Chan Sheung Ni is the spouse of Mr. Chen. Ms. Chan Sheung Ni is therefore deemed to have an interest in the shares of the Company in which Mr. Chen is interested.
6. The entire issued share capital of Ever Good Luck Limited is ultimately owned by Mr. Chen and Mr. Chen is the sole director of Ever Good Luck Limited. See note (7) above.

As at the Latest Practicable Date, save as disclosed above, none of the other Directors was a director or employee of a Company which had an interest or short position in the Shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Division 2 and 3 of Part XV of the SFO.

1. DIRECTORS' INTERESTS IN ASSETS
   As at the Latest Practicable Date, none of the Directors, directly or indirectly, had any interest in any assets which had since 31 December 2018 (being the date to which the latest published audited financial statements of the Group were made up) been acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.
2. DIRECTORS' INTERESTS IN CONTRACTS
   As at the Latest Practicable Date, there was no contract or arrangement subsisting in which any
   Director was materially interested, directly or indirectly, and which was significant in relation to the business of the Group.

- II-4 -

APPENDIX II	GENERAL information

1. MATERIAL CONTRACTS
   The following contracts, not being contracts entered into in the ordinary course of business of the Group, were entered into by members of the Group within the two years immediately preceding the date of this Circular and up to the Latest Practicable Date and are or may be material:
2. 1. On 16 January 2018, (i) the Company and R & F Properties (HK) Company Limited entered into a sale and purchase agreement in respect of the disposal of the London Property Project for a cash consideration of £35,609,277.96; and (ii) the Company, the R & F Properties (HK) Company Limited and Wanda International Real Estate Investment Co. Limited entered into a shareholder loan repayment agreement, in relation to the repayment of debt in the amount of approximately £160 million. Further details of both of the agreements may be found in the announcement and circular of the Company dated 16 January 2018 and 15 March 2018 respectively; and
   2. On 18 January 2018, the Company, AWH Investment Group Pty Ltd and Wanda Australia Commercial Properties Pty Ltd entered into a master agreement in respect of the disposal of the Australia Property Projects for a cash consideration of AU$315,044,422 and repayment of debt in the amount of AU$815,107,691 in instalments. Further details of the master agreement may be found in the announcement and circular of the Company dated 29 January 2018 and 22 February 2018 respectively.
3. LITIGATION
   As at the Latest Practicable Date, none of the members of the Group was engaged in any litigation or arbitration of material importance and no litigation or claim of material importance was known to the Directors to be pending or threatened by or against any member of the Group.
4. NO MATERIAL ADVERSE CHANGE
   As at the Latest Practicable Date, the Directors were not aware of any material adverse change in the financial or trading position of the Group since 31 December 2018, being the date to which the latest published audited consolidated financial statements of the Group were made up.

- II-5 -

APPENDIX II	GENERAL information

9. EXPERTS AND CONSENTS

The following is the qualification of the expert who has given opinion or advice contained in this Circular:

Name	Qualification
Opus Capital Limited	a licensed corporation permitted under the Securities
	and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong) to carry out Type 1 (dealing in securities)
	and Type 6 (advising on corporate finance) regulated
	activities

Opus Capital Limited has given and has not withdrawn its written consent to the issue of this Circular with the inclusion of its letter and references to its name in the form and context in which it appears.

As at the Latest Practicable Date, Opus Capital Limited was not interested in any shares in the Company or any member of the Group, nor did it have any right or option (whether legally enforceable or not) to subscribe for or nominate persons to subscribe for any shares in the Company or any member of the Group.

As at the Last Practicable Date, Opus Capital Limited had no interest, direct or indirect, in any assets which have been, since 31 December 2018 (being the date to which the latest published audited accounts of the Group were made up), acquired or disposed of by or leased to any member of the Group, or are proposed to be acquired or disposed of by or leased to any member of the Group.

10. SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had entered into, or proposed to enter into, a service contract with the Company or any member of the Group which does not expire or is not determinable by the Company or such member of the Group within one year without payment of compensation (other than statutory compensation).

- II-6 -

APPENDIX II	GENERAL information

11. DIRECTORS' INTERESTS IN COMPETING BUSINESS

Save as disclosed below, as at the Latest Practicable Date, none of the Directors or their respective close associates was interested in businesses which compete or are likely to compete, either directly or indirectly, with business of the Group the interests of which would be required to be disclosed under Rule 8.10 of the Listing Rules if the relevant Director were a controlling shareholder of the Company.

Name of		Nature of interest	Business of the
Director/close associate	Name of company	in the company	company
Mr. Ding Benxi	DWCM Group	Being a director and	Engaging in
		shareholder with		property
		1.10% interest		development,
				property lease,
				property
				management and
				investment holding
Mr. Zhang Lin	DWCM Group	Being a shareholder	Engaging in
		with 0.22% interest		property
				development,
				property lease,
				property
				management and
				investment holding
Mr. Ning Qifeng	DWCM Group	Being a shareholder	Engaging in
		with 0.13% interest		property
				development,
				property lease,
				property
				management and
				investment holding
Mr. Han Xu	DWCM Group	Being a shareholder	Engaging in
		with 0.035% interest		property
				development,
				property lease,
				property
				management and
				investment holding

- II-7 -

APPENDIX II		GENERAL information
Name of		Nature of interest	Business of the
Director/close associate	Name of company	in the company	company
Mr. He Zhiping	DWCM Group	Being a shareholder	Engaging in
		with 0.55% interest		property
				development,
				property lease,
				property
				management and
				investment holding

1. MISCELLANEOUS
2. 1. The company secretary of the Company is Ms. Hui Wai Man, Shirley. She is a fellow member of The Association of Chartered Certified Accountants, Hong Kong Institute of Certified Public Accountants, The Institute of Chartered Secretaries and Administrators and The Hong Kong Institute of Chartered Secretaries. She is also a member of Hong Kong Securities Institute and the Society of Chinese Accountants & Auditors.
   2. The principal share registrar and transfer office of the Company is MUFG Fund Services
      (Bermuda) Limited located at 4th Floor North Cedar House, 41 Cedar Avenue, Hamilton HM12 Bermuda.
   3. The Hong Kong branch share registrar and transfer office of the Company is Tricor Standard Limited located at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong.
   4. The English text of this Circular prevails over the Chinese text.
3. DOCUMENTS AVAILABLE FOR INSPECTION
   Copies of the following documents are available for inspection during normal business hours from 9:30 a.m. to 5:30 p.m. (except Saturdays, Sundays and gazetted public holidays in Hong Kong), at Unit 3007, 30/F, Two Exchange Square, 8 Connaught Place, Central, Hong Kong from the date of this Circular up to and including the date of the SGM:
4. 1. the Deed of Assignment of London Project Receivables;
   2. the Deed of Assignment of Australia Projects Receivables;
   3. the Hotel Design Framework Agreement;
   4. the Hotel Construction Management Framework Agreement;
   5. the memorandum of association and bye-laws of the Company;

- II-8 -

APPENDIX II	GENERAL information

1. the annual reports of the Company for each of the two financial years ended 2017 and 2018;
2. the letter from the Board, the text of which is set out on pages 6 to 26 of this Circular;
3. the letter from the Independent Board Committee, the text of which is set out on pages 27 to 28 of this Circular;
4. the letter of advice from Opus Capital Limited, the text of which is set out on pages 29 to 63 of this Circular;
5. the sale and purchase agreement dated 16 January 2018 entered into between the Company and R & F Properties (HK) Company Limited in repsect of the disposal of the London Property Project;
6. the shareholder loan repayment agreement dated 16 January 2018 entered into between the Company, the R & F Properties (HK) Company Limited and Wanda International Real Estate Investment Co. Limited in relation to repayment of debt;
7. the master agreement dated 18 January 2018 entered into between the Company, AWH Investment Group Pty Ltd and Wanda Australia Commercial Properties Pty Ltd in respect of the disposal of the Australia Property Projects;
8. the written consent referred to in the paragraph headed "Experts and consent" in this Appendix II;
9. the announcement of the Company dated 16 January 2018 in relation to the disposal of the London Property Project;
10. the announcement of the Company dated 29 January 2018 in relation to the disposal of the Australia Property Projects; and
11. this Circular.

- II-9 -

NOTICE OF SGM

萬 達 酒 店 發 展 有 限 公 司

WANDA HOTEL DEVELOPMENT COMPANY LIMITED

(Incorporated in Bermuda with limited liability)

(Stock Code : 169)

NOTICE IS HEREBY GIVEN that a special general meeting of Wanda Hotel Development Company Limited (the "Company") will be held at Unit 3007, 30/F., Two Exchange Square, 8 Connaught Place, Central, Hong Kong on 17 December 2019 at 10:00 a.m. for the purpose of considering and, if thought fit, passing the following resolutions (with or without amendments) as ordinary resolutions of the Company:

ORDINARY RESOLUTIONS

"THAT:

1. "THAT the entering into by the Company of the Deed of Assignment of London Project Receivables dated 18 October 2019 (a copy of which has been produced to the meeting and initialled by the chairman of the meeting for the purposes of identification) and the transactions contemplated thereunder be and are hereby approved (terms defined in the Circular of the Company dated 28 November 2019 having the same meanings when used in this resolution)."
2. "THAT the entering into by the Company of the Deed of Assignment of Australia Projects Receivables dated 18 October 2019 (a copy of which has been produced to the meeting and initialled by the chairman of the meeting for the purposes of identification) and the transactions contemplated thereunder be and are hereby approved (terms defined in the Circular of the Company dated 28 November 2019 having the same meanings when used in this resolution)."
3. "THAT the entering into by the Company of the Hotel Design Framework Agreement dated 18 October 2019 (a copy of which have been produced to the meeting and initialled by the chairman of the meeting for the purposes of identification) and the transactions contemplated thereunder be and are hereby approved (terms defined in the Circular of the Company dated 28
   November 2019 having the same meanings when used in this resolution)."

- SGM-1 -

NOTICE OF SGM

4. "THAT the entering into by the Company of the Hotel Construction Management Framework Agreement dated 18 October 2019 (a copy of which have been produced to the meeting and initialled by the chairman of the meeting for the purposes of identification) and the transactions contemplated thereunder be and are hereby approved (terms defined in the Circular of the Company dated 28 November 2019 having the same meanings when used in this resolution)."

By order of the Board

Wanda Hotel Development Company Limited

Ding Benxi

Chairman

Hong Kong, 28 November 2019

Notes:

1. A shareholder entitled to attend and vote at the meeting convened by the above notice (or at any adjournment thereof) is entitled to appoint a proxy to attend and, on a poll, vote instead of him. A shareholder holding two or more shares is entitled to appoint more than one proxy. A proxy need not be a shareholder of the Company but must be present in person to represent the shareholder. Completion and return of an instrument appointing a proxy will not preclude a shareholder from attending and voting in person at the meeting (or any adjournment thereof).
2. Where there are joint registered holders of any shares, any one of such persons may vote at the meeting (or at any adjournment thereof), either personally or by proxy, in respect of such shares as if he were solely entitled thereto; but if more than one of such joint holders are present at the meeting (or at any adjournment thereof) personally or by proxy, that one of the said persons so present whose name stands first on the register of members of the Company in respect of such shares shall alone be entitled to vote in respect thereof.
3. In order to be valid, the proxy form, and any power of attorney (if any) or other authority (if any) under which it is signed (or a copy of such power or authority certified notarially), must be delivered to the Company's Hong Kong branch share registrar, Tricor Standard Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong, not less than 48 hours before the time fixed for holding the meeting (or any adjournment thereof).
4. The shareholders whose names appear on the register of members of the Company on Wednesday, 11 December 2019 are entitled to attend the meeting. In order to qualify for attending the meeting, all transfer documents accompanied by the relevant share certificates must be lodged with the Company's Hong Kong branch share registrar, Tricor Standard Limited, at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong, no later than 4:30 p.m. on Wednesday, 11 December 2019 .

- SGM-2 -