Shanghai Fosun Pharmaceutical : CONNECTED TRANSACTION REGARDING THE TARGET FUND LPA AND CONTINUING CONNECTED TRANSACTION REGARDING THE TARGET FUND MANAGEMENT AGREEMENT AND FURTHER INFORMATION ON CONNECTED TRANSACTION REGARDING THE DALIAN FUND LPA

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上 海 復 星 醫 藥（ 集 團 ）股 份 有 限 公 司

Shanghai Fosun Pharmaceutical (Group) Co., Ltd.*

(a joint stock company incorporated in the People's Republic of China with limited liability)

(Stock Code: 02196)

CONNECTED TRANSACTION

REGARDING THE TARGET FUND LPA

AND

CONTINUING CONNECTED TRANSACTION

REGARDING THE TARGET FUND MANAGEMENT AGREEMENT

AND

FURTHER INFORMATION ON CONNECTED TRANSACTION REGARDING THE

DALIAN FUND LPA

THE TARGET FUND LPA

The Board is pleased to announce that on 24 January 2022, Xingsheng Fuying and Ningbo Fuying (both being subsidiaries of the Company), Fosun High Tech (controlling shareholder of the Company) and Suzhou Tianshi Parent Fund entered into the Target Fund LPA in relation to, among others, the establishment of the Target Fund, of which the initial contribution shall amount to RMB176 million and the total contribution shall not exceed RMB500 million in any event. The Target Fund will mainly invest in early stage enterprises in the biomedical and healthcare industries.

THE TARGET FUND MANAGEMENT AGREEMENT

Upon formation of the Target Fund, the Target Fund, Xingsheng Fuying and Fujian Fund will enter into the Target Fund Management Agreement to engage Fujian Fund as the fund manager to provide fund management services to the Target Fund from the Initial Contribution Date to 31 December 2024.

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LISTING RULE IMPLICATIONS

Regarding the Target Fund LPA, as at the date of this announcement, Fosun High Tech is the controlling shareholder of the Company and therefore constitutes a connected person of the Company under Rule 14A.07 of the Listing Rules. Therefore, the transactions contemplated under the Target Fund LPA constitute connected transactions of the Company under Chapter 14A of the Listing Rules.

Given that the same connected person of the Company i.e. Mr. Guo Guangchang has interests in or controls the relevant parties to the Target Fund LPA as well as the relevant parties to the Previous Connected Transactions, pursuant to Rule 14A.81 of the Listing Rules, the transactions contemplated under the Target Fund LPA shall be aggregated with the Previous Connected Transactions. As the aggregated relevant percentage ratios applicable to the transactions contemplated under the Target Fund LPA and the Previous Connected Transactions are more than 0.1% but less than 5%, the transactions contemplated under the Target Fund LPA are subject to reporting and announcement requirements but are exempt from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

With respect to the proposal to enter into the Target Fund Management Agreement upon formation of the Target Fund, as Fujian Fund is a company owned by the Company and the controlling shareholder of the Company Fosun High Tech (through its subsidiaries) as to 60% and 40%, respectively, Fujian Fund is a connected subsidiary of the Company under Rule 14A.16 of the Listing Rules and a connected person of the Company under the Listing Rules. Therefore, the transactions contemplated under the Target Fund Management Agreement will (when entered into) constitute continuing connected transactions of the Company under Chapter 14A of the Listing Rules.

Given that Fujian Fund entered into the Existing Fund Management Agreements with other subsidiaries of the Company, under Rule 14A.81 of the Listing Rules, the transactions contemplated under the Target Fund Management Agreement will be aggregated with those contemplated under the Existing Fund Management Agreements. As the relevant applicable percentage ratios after aggregation on an annual basis applicable to the transactions contemplated under the Target Fund Management Agreement and the Existing Fund Management Agreements will be more than 0.1% but less than 5%, the transactions contemplated under the Target Fund Management Agreement will be subject to reporting, annual review and announcement requirements but will be exempt from the independent shareholders' approval requirement under Chapter 14A of the Listing Rules.

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1. THE TARGET FUND LPA
   The Board is pleased to announce that on 24 January 2022, Xingsheng Fuying and Ningbo Fuying (both being subsidiaries of the Company), Fosun High Tech (controlling shareholder of the Company) and Suzhou Tianshi Parent Fund entered into the Target Fund LPA in relation to, among others, the establishment of the Target Fund, of which the initial contribution shall amount to RMB176 million and the total contribution shall not exceed RMB500 million. The Target Fund will mainly invest in early stage enterprises in the biomedical and healthcare industries.
   Principal terms of the Target Fund LPA are summarised below. Date
   24 January 2022 Parties
2. 1. Xingsheng Fuying, as the general partner;
   2. Ningbo Fuying, as a limited partner;
   3. Fosun High Tech, as a limited partner; and
   4. Suzhou Tianshi Parent Fund, as a limited partner.

To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, Suzhou Tianshi Parent Fund and its ultimate beneficial owners are third parties independent of the Company and its connected persons.

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Contribution

The initial contribution shall amount to RMB176 million. The amount of contribution by each partner to the Target Fund is set out below:

				Percentage of the
		Subscription	initial contribution
Partner	Type	Contribution	to the Target Fund
		(RMB million)
Xingsheng Fuying	General partner	3		1.70%
Ningbo Fuying	Limited partner	66		37.50%
Fosun High Tech	Limited partner	44		25.00%
Suzhou Tianshi Parent Fund	Limited partner	63		35.80%
TOTAL		176		100.00%

Note: the percentage of interest in the Target Fund to be held by each partner is subject to completion of all contributions pursuant to the Target Fund LPA including the initial contribution.

After completion of the initial contribution, the general partner may conduct an additional round of contribution. Completion of such additional contribution shall not be later than 23 May 2022 and the total contribution (which includes the initial contribution) shall not exceed RMB500 million. The total amount contributed by Suzhou Tianshi Parent Fund shall not exceed RMB80 million in any event.

The contribution amount by each partner of the Target Fund was determined between the parties through arm's length negotiation based on the capital requirements of the Target Fund. Xingsheng Fuying and Ningbo Fuying will settle the contribution by self-raised funds.

Arrangement for the Initial Contribution

Each partner shall pay the initial contribution by three instalments:

1. as early as the incorporation date of the Target Fund, the general partner may issue an invoice of 50% of the respective initial contribution to each partner;
2. as early as six months after the incorporation date of the Target Fund, the general partner may issue an invoice of 30% of the respective initial contribution to each partner; and
3. as early as twelve months after the incorporation date of the Target Fund and no later than the 2nd anniversary of the incorporation date of the Target Fund, the general partner may issue an invoice of 20% of the respective initial contribution to each partner.

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Suzhou Tianshi Parent Fund's obligation to make any contribution to the Target Fund is conditional upon, among other things, other partners of the Target Fund having made contributions with respect to the relevant instalment in compliance with the agreement.

Management and decision-making

1. The general partner of the Target Fund (namely Xingsheng Fuying) shall be the managing partner and is responsible for the day-to-day operation of the Target Fund and represents the Target Fund externally.
2. The general partner of the Target Fund shall establish an investment committee (the ''Investment Committee'') comprising five members. The Investment Committee is responsible for considering and deciding on investment targets proposed by the fund manager and every resolution of the Investment Committee requires approval of more than (and inclusive of) two-thirds of all of its members.
   Suzhou Tianshi Parent Fund may appoint two observers to the Investment Committee.
3. The Target Fund's partners shall meet for the first time within 1 months of its establishment and an annual partners' meeting shall be held within 6 months following the end of each year to consider the general partner's report on the Target Fund's performance in the previous year, and for all partners to provide strategic investment recommendations to the general partner.

Duration

The term of the Target Fund shall be 7 years commencing from the Initial Contribution Date. The term may be extended twice (extending one year each time) by consent of all partners. The investment period is from the Initial Contribution Date to the 3rd anniversary of the Initial Contribution Date. The remaining period after the investment period is the divestment period during which the partners no longer have any obligation to make contribution and the Target Fund shall not invest in any new projects.

Manager and management fee

The Target Fund will be managed by the fund manager pursuant to the terms of the Target Fund Management Agreement of which details are described in section B below.

Investment

1. Investment targets
   The Target Fund will mainly engage in equity and quasi-equity investment in early stage enterprises in the biomedical and healthcare industries.

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