Shimao : Proposals for General Mandates to Issue and Buy Back Shares and Re-election of Retiring Directors and Notice of Annual General Meeting

LETTER FROM THE BOARD

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(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 813)

Directors:	Registered Office:
Executive Directors	Cricket Square
Mr. Hui Wing Mau (Chairman)	Hutchins Drive
Mr. Hui Sai Tan, Jason (Vice Chairman and President)	P.O. Box 2681
Ms. Tang Fei	Grand Cayman KY1-1111
Mr. Lu Yi	Cayman Islands

Non-executive Director	Principal Place of Business in Hong Kong:
Mr. Ye Mingjie	38th Floor, Tower One
	Lippo Centre
Independent Non-executive Directors	89 Queensway
Ms. Kan Lai Kuen, Alice	Hong Kong
Mr. Lyu Hong Bing
Mr. Lam Ching Kam
	30 April 2021
To the Shareholders
Dear Sir or Madam,

PROPOSALS FOR GENERAL MANDATES TO ISSUE AND BUY BACK SHARES

AND

RE-ELECTION OF RETIRING DIRECTORS

AND

NOTICE OF ANNUAL GENERAL MEETING

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LETTER FROM THE BOARD

GENERAL MANDATES TO ISSUE AND BUY BACK SHARES

At the annual general meeting of Shimao Group Holdings Limited (the "Company", together with its subsidiaries, the "Group") held on 27 May 2020, general and unconditional mandates were given to the directors of the Company (the "Directors") to issue and buy back shares of the Company (the "Shares") and these general mandates will lapse at the conclusion of the forthcoming annual general meeting (the "2021 AGM"). The Directors believe that a renewal of these general mandates is in the best interests of the Company and its shareholders. Accordingly, the following separate ordinary resolutions will be proposed at the 2021 AGM to give the Directors general and unconditional mandates to exercise powers of the Company to issue and buy back the Shares:

1. an ordinary resolution (resolution No. 5) to give the Directors a general and unconditional mandate to allot, issue and otherwise deal with additional Shares up to 10% of the number of Shares in issue as at the date of the 2021 AGM (the "Issue Mandate"), equivalent to a maximum of 353,769,746 Shares if there is no change in the number of Shares in issue prior to the date of the 2021 AGM and the Shares to be allotted and issued pursuant to this general mandate shall not be at a discount of more than 10% to the "benchmarked price" (as described in Rule 13.36(5) of the Rules Governing the Listing of Securities (the "Listing Rules") on The Stock Exchange of Hong Kong Limited (the "HKEx")) of such Shares; and
2. an ordinary resolution (resolution No. 6) to give the Directors a general and unconditional mandate to buy back Shares up to a maximum of 10% of the number of Shares of the Company in issue as at the date of the 2021 AGM (the "Buy-back Mandate"), equivalent to a maximum of 353,769,746 Shares if there is no change in the number of Shares of the Company in issue prior to the date of the 2021 AGM.

Details of the abovementioned ordinary resolutions are contained in the notice of the 2021 AGM set out in this document. An explanatory statement, as required by the Listing Rules to be sent to the shareholders in connection with the Buy-back Mandate, is also set out in the Appendix of this document. This contains all the information reasonably necessary to enable the shareholders to make an informed decision on whether or not to vote for or against the ordinary resolution to grant to the Directors the Buy-back Mandate at the 2021 AGM. The Directors wish to state that they have no immediate plan to issue or buy back any Shares pursuant to these mandates.

RE-ELECTION OF RETIRING DIRECTORS

In accordance with Article 86(3) of the Articles of Association of the Company (the "Articles of Association"), Mr. Ye Mingjie who was appointed as Director after the last annual general meeting, will hold office until the 2021 AGM and, being eligible, has offered himself for re-election as Director at the 2021 AGM.

In accordance with Article 87 of the Articles of Association, three directors, namely, Mr. Hui Sai Tan, Jason, Mr. Lyu Hong Bing and Mr. Lam Ching Kam (together with Mr. Ye Mingjie, the "Retiring Directors") shall retire by rotation at the 2021 AGM and, all being eligible, have offered themselves for re-election as Directors at the 2021 AGM.

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LETTER FROM THE BOARD

The details of the Retiring Directors proposed for re-election at the 2021 AGM are set out below:

Mr. Hui Sai Tan, Jason, aged 44, joined the Group in March 2000 and has been an Executive Director, the Vice Chairman and President of the Company since 17 November 2004, 21 April 2008 and 30 January 2019 respectively. Mr. Jason Hui obtained a Master of Science Degree in Real Estate from the University of Greenwich, the United Kingdom in 2001 and a Master's Degree in Business Administration from the University of South Australia in 2004. He has more than 22 years' experience in property development and management. He is a member of Shanghai Committee of the Chinese People's Political Consultative Conference and a president of New Home Association, Hong Kong. Mr. Jason Hui is also a director of Shanghai Shimao Co., Ltd. ("Shanghai Shimao"), a 63.92%-owned subsidiary of the Company listed on the Shanghai Stock Exchange, and the chairman and an executive director of Shimao Services Holdings Limited ("Shimao Services"), a 65.88%-owned subsidiary of the Company listed on the HKEx. Mr. Jason Hui is the son of Mr. Hui Wing Mau, the Chairman, an Executive Director and a controlling shareholder (as defined in the Listing Rules) of the Company, and the brother of Ms. Hui Mei Mei, Carol, the vice chairman of Shanghai Shimao.

As at 26 April 2021, being the latest practicable date prior to the printing of this document (the "Latest Practicable Date"), Mr. Jason Hui has interests in 3,537,177 Shares within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) (the "SFO"). The service contract entered into by the Company with Mr. Jason Hui provides for a fixed term of appointment but is subject to retirement by rotation in accordance with the Articles of Association and may be terminated in accordance with the terms thereof. Mr. Jason Hui received remuneration for the year 2020 of approximately RMB7,022,000 as disclosed in the audited consolidated financial statements of the Company for the year ended 31 December 2020. He is entitled to receive discretionary bonus pegged to performance. The board of Directors (the "Board") determines Mr. Jason Hui's emoluments by taking into consideration his duties and responsibilities within the Group, the prevailing market rates as well as the Group's performance and remuneration policy.

Mr. Ye Mingjie, aged 42, was appointed a Non-executive Director of the Company since 1 January

2021. Mr. Ye is also as an executive director and the president of Shimao Services. Mr. Ye joined the Group in February 2004 and successively served as an assistant president of the Group as well as the head of the engineering management center of the Group and was promoted to the position of vice president of the Group in January 2018, where he was responsible for overseeing the engineering management of the Group and the business operations of Shimao Services. Mr. Ye graduated from Tongji University (同濟大

學) in the PRC and specialised in engineering management. Mr. Ye has over 15 years of experience in the property management and related industry. Mr. Ye was appointed as an expert of the Assessment Committee of the Commercial Office Grade Evaluation Criteria (商務寫字樓等級評價標準評審委員會) by China Real Estate Association (中國房地產業協會) for the years from June 2019 to June 2023.

As at the Latest Practicable Date, Mr. Ye has interests in 265,086 Shares within the meaning of Part XV of the SFO. Mr. Ye has not entered into service contract with the Company. Mr. Ye does not receive any remuneration for his service as a Non-executive Director of the Company.

Mr. Lyu Hong Bing, aged 54, has been an Independent Non-executive Director of the Company since 17 November 2004. Mr. Lyu obtained a Master's Degree in law from East China University of Political Science and Law in 1991 and has more than 28 years' experience in corporate and securities laws in China. Mr. Lyu currently serves as an independent director of Shandong Airlines Co., Ltd. (a company publicly listed on the Shenzhen Stock Exchange) and Shanghai New Huang Pu Industrial Group Co., Ltd. (a company publicly listed on the Shanghai Stock Exchange). Mr. Lyu was formerly an independent non-executive director of ZTE Corporation, a company publicly listed on the Shenzhen Stock Exchange and the HKEx, from 2015 to 2018, an independent director of Shanghai Shentong Metro Co., Ltd., a company publicly listed on the Shanghai Stock Exchange, from 2014 to 2020, and an independent non-executive director of CEFC Hong Kong Financial Investment Company Limited, a company publicly listed on the HKEx, from 2017 to 2020. Mr. Lyu is the chief executive partner of the

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LETTER FROM THE BOARD

Grandall Law Firm, a vice-president of the All China Lawyers Association, an arbitrator and member of the Shanghai International Economic and Trade Arbitration Commission, an arbitrator and a member of the Shanghai Arbitration Commission, a concurrent professor of East China University of Political Science and Law and the Shanghai University of International Business and Economics, a member of the Review Board of the China Securities Regulatory Commission for Mergers, Acquisitions, and Restructurings of Listed Companies and a commissioner of the Listing Committee of the Shanghai Stock Exchange.

The service contract entered into by the Company with Mr. Lyu provides for a fixed term of appointment but is subject to retirement by rotation in accordance with the Articles of Association and may be terminated in accordance with the terms thereof. Mr. Lyu is currently receiving a director's fee of HK$360,000 per annum. The Board determines Mr. Lyu's emoluments by taking into consideration his duties and responsibilities and the prevailing market rates.

Mr. Lyu has served as an Independent Non-executive Director of the Company since November

2004. Notwithstanding such a long continuous period of his holding office as an Independent Non-executive Director, given that he has made a confirmation of his independence pursuant to the independence guidelines set out in the Listing Rules, the Company is satisfied with his independence and believes he is still independent. In addition, the Board and the Nomination Committee of the Company considered that his long service would not affect his exercise of independent judgment and was satisfied that Mr. Lyu has the required character, integrity and experience to continue fulfilling the role of Independent Non-executive Director. Mr. Lyu has provided diversity of experience, skills, expertise and background to the Board. He is a practicing lawyer in the PRC with extensive experience and expertise in corporate and securities laws in PRC. With his profound professional experience and directorship experience in various listed companies, he has provided valuable and independent advice and guidance on the business and development of the Group.

Mr. Lam Ching Kam, aged 60, has been an Independent Non-executive Director of the Company since 1 June 2006. He is currently a fellow member of The Hong Kong Institute of Surveyors. Mr. Lam obtained a Master's Degree in Business Administration from the Hong Kong Open University in 2004 and is a fellow member of the Royal Institution of Chartered Surveyors. Mr. Lam was the Vice Chairman of the Royal Institution of Chartered Surveyors China Group from 2003 to 2006. He is a member of the China Civil Engineering Society (中國土木工程學會會員) and also a registered China Cost Engineer (中 國造價工程師執業資格). Mr. Lam has been a consultant to the Beijing Construction Project Management Association (北京市建設監理協會) since 2003 and has engaged in professional training and vocational education in China for more than 19 years. Mr. Lam has been in the property development and construction industry for 37 years, and has worked for construction contractors such as Shui On Building Contractors Limited, China State Construction Engineering Corporation and Hopewell Construction Co., Ltd. Mr. Lam was employed as a quantity surveyor and worked in London from 1990 to 1991. He was employed by certain consultant firms and the Architectural Services Department of the Hong Kong Government before he emigrated to Australia in 1996 and operated a project management firm in Sydney. Mr. Lam was the project controller of Sino Regal Ltd. (HK) for investment projects in China from 1994 to 1996. In 1998, Mr. Lam established a surveying and management consultant firm which has been participating in many large-scale projects in Mainland China and Macau, including a Beijing Olympic 2008 project involving hotels, offices towers and commercial complex in Olympic Park, Beijing. In October 2016, Mr. Lam's company merged with 信永中和工程管理有限公司 (ShineWing Engineering Management Co., Ltd.) (formerly known as 信永中和（北京）國際工程管理諮詢有限公司 ShineWing (Beijing) International Construction Consulting Co., Ltd.) and he became a partner from 1 October 2016.

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LETTER FROM THE BOARD

The service contract entered into by the Company with Mr. Lam provides for a fixed term of appointment but is subject to retirement by rotation in accordance with the Articles of Association and may be terminated in accordance with the terms thereof. Mr. Lam is currently receiving a director's fee of HK$360,000 per annum. The Board determines Mr. Lam's emoluments by taking into consideration his duties and responsibilities and the prevailing market rates.

Mr. Lam has served as an Independent Non-executive Director of the Company since June 2006. Notwithstanding such a long continuous period of his holding office as an Independent Non-executive Director, given that he has made a confirmation of his independence pursuant to the independence guidelines set out in the Listing Rules, the Company is satisfied with his independence and believes he is still independent. In addition, the Board and the Nomination Committee of the Company considered that his long service would not affect his exercise of independent judgment and was satisfied that Mr. Lam has the required character, integrity and experience to continue fulfilling the role of Independent Non-executive Director. Mr. Lam has provided diversity of experience, skills, expertise and background to the Board. With his in-depth knowledge in the property development and construction industry, he has provided valuable and independent advice and guidance on the business and development of the Group.

Pursuant to the Corporate Governance Code set out in the Listing Rules, the re-election of each of Mr. Lyu Hong Bing and Mr. Lam Ching Kam will be subject to separate resolutions to be approved by the shareholders at the 2021 AGM.

So far as the Directors are aware, save as disclosed above, (i) as at the Latest Practicable Date, none of the Retiring Directors had any interest within the meaning of Part XV of the SFO in the securities of the Company; (ii) none of the Retiring Directors held, or in the last 3 years held, any directorship in any publicly-listed company or held any other major appointments or professional qualifications; (iii) none of the Retiring Directors had any relationship with any other Directors, senior management or substantial or controlling shareholders (as defined in the Listing Rules) of the Company; and (iv) in relation to the proposed re-election of the Retiring Directors, there is no information which is disclosable nor is/was any of the Retiring Directors involved in any of the matters required to be disclosed pursuant to the requirements set out in Rule 13.51(2) of the Listing Rules, and there is no other matter which needs to be brought to the attention of the shareholders of the Company.

2021 AGM

A notice convening the 2021 AGM is set out on pages 10 to 14 of this document. At the 2021 AGM, ordinary resolutions will be proposed to approve the Issue Mandate, the Buy-back Mandate and the re-election of the Retiring Directors.

A form of proxy for use at the 2021 AGM is enclosed herewith. Whether or not you are able to attend the 2021 AGM, you are requested to complete the form of proxy in accordance with the instructions printed thereon and return it to the Company's branch share registrar and transfer office in Hong Kong, Tricor Investor Services Limited at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong not less than 48 hours before the time appointed for holding the 2021 AGM. Completion and delivery of a form of proxy will not preclude you from attending and voting at the 2021 AGM or any adjournment thereof if you so wish.

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