Ying Hai Group Holdings Company Limited (SEHK:8668) entered into a legally binding MOU to acquire Zhuhai Huanya International Tourism Co., Ltd. from Cao Yongfeng and Huang Zimin for CNY 0.8 million on June 7, 2021. Ying Hai Group Holdings Company Limited entered into equity transfer agreement to acquire 50% stake in Zhuhai Huanya International Tourism Co., Ltd. from Cao Yongfeng for CNY 0.78 million (equivalent to approximately HKD 0.93 million) on August 24, 2021. The Equity Transfer Agreements shall replace and supersede the MOU, dated June 8, 2021. In a related transaction, Ying Hai Group Holdings Company Limited shall acquire 50% stake in Zhuhai Huanya International Tourism Co., Ltd. from Huang Zimin for CNY 0.78 million. Upon completion of the Acquisition, Zhuhai Huanya International Tourism Co., Ltd. will become a wholly-owned subsidiary of Ying Hai Group Holdings Company Limited and the financial results of Zhuhai Huanya will be consolidated into the consolidated financial statements of the company. Ying Hai Group Holdings Company Limited agrees to pay CNY 800,000 to Cao Yongfeng and Huang Zimin as the total consideration for the Acquisition, which is payable as follows: (i) CNY 400,000 representing 50% of total consideration as the refundable earnest money shall be paid within three days after execution of the MOU; and (ii) the balance of the total consideration, namely CNY 400,000 shall be paid within 15 days after completion of the relevant legal procedures for registration of the transfer of the equity interest in the Target Company. Zhuhai Huanya International reported approximately CNY 1.4 million of total assets at December 31, 2020. Post signing of separate agreements, the consideration for 50% stake shall be paid as a refundable earnest money of CNY 0.2 million, which was already paid on June 15, 2021, CNY 0.2 million shall be paid within five business days upon receiving the approval of change of business registration, CNY 0.3 million as guaranteed payment within 5 days and CNY 65,995 shall be paid within five business days after receiving the
receivables. The completion of the Acquisition is subject to fulfillment of, among others, the following conditions precedent: (i) the Target Company having all the requisite qualification or permits to carry on the business as a tourism company in the PRC, which allows the transfer of the equity interest in the Target Company for the Acquisition; (ii) the current shareholders of the Target Company having disclosed a complete non-compliance report to the Company; (iii) the Company being satisfied with the results of the due diligence conducted to the Target Company; (iv) there being no material adverse change in the Target Company's business, operations or financial conditions; (v) all existing employment contracts entered into by the Target Company being terminated and the subsidiaries of the Target Company being deregistered; (vi) the execution of the formal agreement of the Acquisition; and (vii) all debt and liabilities of the Target Company and its subsidiaries and all undertakings by the Target Company have been settled within 30 days after execution of the MOU. Upon conducting further due diligence the Group learned that it is necessary for the Zhuhai Huanya International Tourism Co., Ltd. to maintain certain contract deposits in order to maintain its operation as travel agency. As such parties, agreed to upwardly adjust the total consideration payable to the Vendors from CNY 0.8 million to CNY 1.55 million which reflects the cash and the additional value of the contract deposits of approximately CNY 0.75 million.

Ying Hai Group Holdings Company Limited (SEHK:8668) completed the acquisition of Zhuhai Huanya International Tourism Co., Ltd. from Cao Yongfeng and Huang Zimin on August 31, 2021