CK Life Sciences Intl : Discloseable Transaction in respect of the Acquisition of Nangiloc Colignan Farms

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 0775)

DISCLOSEABLE TRANSACTION

IN RESPECT OF

THE ACQUISITION OF NANGILOC COLIGNAN FARMS

The Board announces that on 15 November 2018, the Purchaser, an indirect wholly-owned subsidiary of the Company, entered into the Property Contract and the NSW WAL Contract with the Vendors for the acquisition of the Property and NSW WAL respectively for an aggregate purchase price of AUD50,000,000 (equivalent to approximately HK$283,000,000). The Purchaser also entered into the Umbrella Deed with the Vendors, the Asset Sellers, BL Moras and the Asset Buyer on the same date, which governs the interdependence of the Transaction Documents.

As one or more of the applicable percentage ratios as calculated under Rule 14.07 of the Listing Rules in respect of the Acquisition is more than 5% but all of the applicable percentage ratios are less than 25%, the Acquisition constitutes a discloseable transaction of the Company and is subject to the reporting and announcement requirements but exempt from the shareholders' approval requirement under Chapter 14 of the Listing Rules.

As Settlement depends on the fulfilment of certain terms and conditions under the Property Contract, there remains the possibility that the Acquisition may or may not proceed. Shareholders and potential investors should exercise caution when dealing in the shares of the Company.

INTRODUCTION

The Board announces that on 15 November 2018, the Purchaser, an indirect wholly-owned subsidiary of the Company, entered into the Property Contract and the NSW WAL Contract with the Vendors for the acquisition of the Property and NSW WAL respectively for an aggregate purchase price of AUD50,000,000 (equivalent to approximately HK$283,000,000). The Purchaser also entered into the Umbrella Deed with the Vendors, the Asset Sellers, BL Moras and the Asset Buyer on the same date, which governs the interdependence of the Transaction Documents. Settlement is subject to thecontemporaneous settlement of the Transaction Documents. To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, the Property is currently used by the Asset Sellers to carry on the business of the Nangiloc Colignan Farms.

THE PROPERTY CONTRACT

Date

15 November 2018

Parties to the Property Contract

• (1) the Purchaser; and

• (2) the Vendors.

Asset to be acquired

The Vendors have agreed to sell and the Purchaser has agreed to purchase the Property, which includes the Land, Water Rights, and all Improvements but excludes the Unpicked Crops. The Property is acquired subject to the terms and conditions of the Property Contract, and in respect of Improvements which comprise plantings in which there are PBRs, the Property is also acquired subject to those PBRs. The address of the Property is Nangiloc Colignan Farms, Boonoonar Road, Brown Road and Watts Lane, Colignan VIC 3494, Australia. To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, the Nangiloc Colignan Farms is one of the largest growers, packers and marketers of premium table grapes and citrus for export and domestic markets in the Sunraysia region of Australia. Further details of the Land are set out as below:

Goods sold with the Land:	all fixtures and fittings (excluding any tenants fixtures and fittings) and
including but not limited to the 18 demountable cabins on that part of
the Property known as the Caravan Park
Aggregated site area:	697.44 hectares
Zoning:	Farming Zone
Conditions Precedent

Settlement shall be conditional upon:

(i) the Vendors obtaining the approval of the Water Authority to transfer the Water Rights from the Vendors to the Purchaser by the Sunset Date with registration of such transfer to take effect following Settlement;

• (ii) the Vendors procuring Moras Properties, Australian Tartaric Products Pty Ltd, Mildura Citrus Pty Limited, the Asset Buyer, the Guarantor and the Purchaser to enter into a confirmation deed whereby Moras Properties novates its rights and interest in the Mildura Citrus Irrigation System Agreement to the Asset Buyer and the Purchaser is granted step-in rights with effect from Settlement, by the Sunset Date in accordance with the Umbrella Deed;

• (iii) the Vendors procuring an executed Confirmation Deed in relation to each Variety Agreement by the Sunset Date in accordance with the Umbrella Deed; and

• (iv) the Lease being entered into by, among others, the Purchaser and the Asset Buyer and the Asset Buyer providing to the Purchaser (to its satisfaction acting reasonably) the insurances which the Lease requires the Asset Buyer to have in place on the commencing date of the Lease.

If the above conditions (i) to (iv) have not been satisfied by the Sunset Date, the Purchaser may terminate the Property Contract by notice in writing to the Vendors within two Business Days after the Sunset Date provided that the Purchaser has complied with the relevant provisions under the Property Contract. Upon termination, neither party will have any liability, duty or obligation to the other party except for antecedent breaches, and all parties are released from their obligations under the Property Contract, and the stakeholder of the deposit shall return the deposit paid by the Purchaser under the Property Contract to the Purchaser.

Settlement

The Purchaser and the Vendors shall settle by the Settlement Due Date.

Purchase Price and Payment Terms

The aggregate purchase price for the Acquisition is AUD50,000,000 (equivalent to approximately HK$283,000,000), which is apportioned as to:

• • AUD28,073,748 (equivalent to approximately HK$158,897,414) for the Land and Improvements (including trees and plantings but excluding the Caravan Park);

• • AUD2,000,000 (equivalent to approximately HK$11,320,000) for the Caravan Park;

• • AUD16,069,140 (equivalent to approximately HK$90,951,332) for the Water Rights; and

• • AUD3,857,112 (equivalent to approximately HK$21,831,254) for NSW WAL,

and shall be payable to the Vendors in such allocation as set out in the Property Contract on Settlement. The apportionment has been determined with reference to the respective market value of the assets comprising the Property. The purchase price shall be satisfied in the following manner:

(i) a deposit of AUD2,500,000 (equivalent to approximately HK$14,150,000) shall be paid by the

Purchaser to the Vendors' legal representative as stakeholder within 10 Business Days after the date of the Property Contract; and

(ii) the balance of AUD47,500,000 (equivalent to approximately HK$268,850,000) shall be paid by the

Purchaser on the date of Settlement.

The payment of the purchase price for the Acquisition will be financed by internal resources of the Group. The Group has taken into account the following factors in determining the purchase price for the Acquisition, which was arrived at after arm's length negotiations between the parties: (i) the economic benefits of the Acquisition to the Group; (ii) the future capital appreciation potential of the Property; (iii) the synergistic effects and strategic value of the Property in relation to the other agricultural properties currently owned by the Group; and (iv) the valuation of not less than AUD50,000,000 of the Property and the NSW WAL as at 26 October 2018 conducted by an independent valuer.

The Vendors will, at their cost, use their best endeavours to achieve practical completion of the Current Capital Expenditure Projects on or before the date of Settlement, and if not achieved, the Retention Amount will be paid by the Purchaser to the Vendors' solicitor on Settlement as part of the payment of the purchase price for the Acquisition, to be held until completion of the incomplete Current Capital Expenditure Projects. The Retention Amount will be released to the Vendors following completion of the incomplete Current Capital Expenditure Projects provided that if practical completion has not been achieved by 31 March 2019, the Purchaser will, or will procure the Asset Buyer to, complete the incomplete Current Capital Expenditure Projects at the cost of the Vendors and the Vendors' solicitor will release the portion of the Retention Amount equivalent to the costs reasonably incurred to achieve practical completion to, or at the direction of, the Purchaser following practical completion, with the balance (if any) paid to the Vendors. Where the costs incurred to achieve practical completion exceed the Retention Amount, the Vendors will pay the shortfall to the Purchaser or as the Purchaser may direct.

The Vendors and the Purchaser agree that the supply of the Property made under the Property Contract is a GST-free supply of farm land for farming, and the supply of the Water Rights is a GST-free supply, under the GST Act. If the supply of the Caravan Park is a taxable supply, the Purchaser shall pay the relevant GST amount on Settlement, provided that the Vendors provide to the Purchaser a tax invoice on or before Settlement. If the Australia Taxation Office determines that any other GST is payable by the Vendors under the Property Contract, the Purchaser agrees to pay an additional amount to the Vendors equal to the amount of GST payable.

THE NSW WAL CONTRACT

Date

15 November 2018

Parties to the NSW WAL Contract

• (1) the Purchaser; and

• (2) Moras Investments (being one of the Vendors).

Asset to be acquired

Moras Investments (being one of the Vendors) has agreed to sell and the Purchaser has agreed to purchase the NSW WAL, subject to the terms and conditions of the NSW WAL Contract.

Settlement

The NSW WAL Contract shall be settled by the Settlement Due Date.

Purchase Price and Payment Terms

The consideration of AUD3,857,112 (equivalent to approximately HK$21,831,254) payable for the NSW WAL is included in the aggregate purchase price of AUD50,000,000 for the Acquisition payable under the Property Contract as described above.

INTERDEPENDENCE OF THE TRANSACTION DOCUMENTS

Each of the Property Contract and the NSW WAL Contract is interdependent with the Transaction Documents. The Property Contract and the NSW WAL Contract will not have any legal force or effect unless and until each Transaction Document has been properly executed by the parties to it and exchanged. The Property Contract and the NSW WAL Contract must be settled contemporaneously with the settlement of each of the Transaction Documents.