Sunac Services Holdings Limited (SEHK:1516) entered into the a share transfer framework agreement to acquire 21.39% stake in First Service Holding Limited (SEHK:2107) from Zhang Lei and Zhang Peng for approximately CNY 460 million on October 7, 2021. As per terms of transaction, a total of 213.929 million Shares will be sold at CNY 2.15 per Share representing approximately 21.39% of the entire issued share capital of First Service Holding. As per terms, Zhang Lei will sell 43.15 million shares representing 4.32% stake for CNY 92.8 million and Zhang Peng will sell 170.78 million shares representing 17.08% stake for CNY 367.2 million.

Within five business days after the execution of the framework agreement and Zhang Lei and Zhang Peng having charged 200 million First Service Holding's shares, representing 20% of the entire issued share capital of First Service Holding to Sunac Services Holdings Limited, Sunac Services Holdings Limited shall pay CNY 100 million to Zhang Lei and Zhang Peng as the first deposit and within five business days after the formal agreement is signed and Zhang Lei and Zhang Peng having charged the remaining 13.9 million Service Holding's shares held by them to Sunac Services Holdings, Sunac Services Holdings shall pay an amount equivalent to 30% of the consideration minus the First Deposit, as the second deposit. Zhang Lei and Zhang Peng shall repay the First Deposit and the Second Deposit to Sunac Services Holdings Limited within 90 days after the payment of the second consideration payment by Sunac Services Holdings. In a related transaction, Sunac Services Holdings Limited entered into the management share transfer agreement to acquire 2.18% stake in First Service Holding Limited from Liu Peiqing and Long Han of CNY 46.9 million on October 7, 2021. Sunac Services Holdings Limited entered into management share transfer agreement to acquire 8.64% stake in First Service Holding Limited from Shanghai CDH Yaojia Venture Capital Center for approximately CNY 190 million on October 7, 2021.

Sunac Services Holdings Limited, Zhang Lei and Zhang Peng will be liable for the termination fees of amount equal to 5% of the total consideration being CNY 23 million based on the initial consideration of CNY 459.9 million. Sunac Services intends to finance and satisfy the total maximum consideration payable (including the stamp duty payable) under the Offer and the transaction under the Share Transfer Agreements with its own internal resources, including using the net proceeds from the listing of the shares of Sunac Services. Zhang Lei and Zhang Peng irrevocably undertook to procure the Core Management to remain in their respective roles in the First Service Holding Group and to maintain staff stability (other than any resignation of Liu Peiqing as a Director. The transaction is subject to signing of the formal agreement, approval of the Anti-monopoly Bureau of the State Administration for Market Regulation, all third-party consents, approvals and notices necessary or required as a result of the entering into of the transactions contemplated under the framework Agreement and completion of the other Share Transfer Agreements. Long stop date is November 30, 2021. Somerley Capital Limited acted as financial advisor to Sunac Services Holdings Limited and Shenyin Wanguo Capital (H.K.) Limited acted as financial advisor to First Service Holding Limited.

Sunac Services Holdings Limited (SEHK:1516) cancelled the acquisition of 21.39% stake in First Service Holding Limited (SEHK:2107) from Zhang Lei and Zhang Peng on January 3, 2022. Pursuant to the Share Transfer Framework Agreement, the CS Vendors shall refund to the Sunac Services Holdings the First Deposit in the amount of CNY 100 million within 5 business days after the Termination. Within 5 business days after the refund, the Sunac Services Holdings will release the share charges in respect of the 200 million CS Target Shares made by the CS Vendors to the Sunac Services Holdings.