China Shandong Expressway Financial Group Co., Ltd. (00412.HK)It is announced that after the trading session on September 30, 2021, the company entered into a subscription agreement with the issuer Yip Cheong Investment Company Limited as the subscriber through its wholly-owned subsidiary Safe Castle Limited, pursuant to which Safe Castle has conditionally agreed to subscribe for notes with a total principal not exceeding US $120000000.

Yip Cheong Investment Co., Ltd. is an investment holding company wholly owned by the guarantor. GuarantorKaisa Group(stock code: 01638.HK). The guarantor is engaged in investment holding in mainland China, and its subsidiaries are mainly engaged in property development. It has all the rights and interests of the issuer.

The mortgage company isKaisa is beautiful.Its shares are listed on the Stock Exchange (stock code: 02168.HK). Mortgage companies and their subsidiaries are mainly engaged in the provision of property management services in mainland China. As at the date of this announcement, the issuer directly owns approximately 67.18% of the issued share capital of the Mortgage Company.

The reason for the subscription is that the interest rate on the note is determined taking into account the following factors: (I) the interest rate of the secured secured instrument issued by the guarantor group; and (ii) the collateral provided to the instrument.

Having considered (I) the terms of the subscription; (ii) the expected income and cash flow of the instrument; (iii) the credit rating of the guarantor; (iv) the financial position of the guarantor; and (v) the collateral provided to the instrument, the directors consider that the terms of the subscription Agreement are fair and reasonable and in the interests of the shareholders and the Company as a whole.