China South City Holdings Limited – Consent Solicitation - Modifications

MODIFICATIONS TO THE CONSENT SOLICITATION, THE EXPECTED TIMETABLE AND THE PROPOSED AMENDMENTS IN RELATION TO 9.0% SENIOR NOTES DUE APRIL 2024 (ISIN: XS2085883119, COMMON CODE: 208588311) 9.0% SENIOR NOTES DUE JUNE 2024 (ISIN: XS2120092882, COMMON CODE: 212009288) 9.0% SENIOR NOTES DUE JULY 2024 (ISIN: XS1720216388, COMMON CODE: 172021638) 9.0% SENIOR NOTES DUE OCTOBER 2024 (ISIN: XS2238030162, COMMON CODE: 223803016) and 9.0% SENIOR NOTES DUE DECEMBER 2024 (ISIN: XS2227909640, COMMON CODE: 222790964)

11 DECEMBER 2023

Full announcement, including disclaimers and offer/distribution restrictions, available via Hong Kong Exchanges and Clearing Limited

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China South City Holdings Limited - Consent Solicitation in relation to Senior Notes due on April, June, July, October and December 2024 - XS2085883119 - XS2120092882 - XS1720216388 - XS2238030162 - XS2227909640

04 DECEMBER 2023

Full announcement, including disclaimers and offer/distribution restrictions, available via Hong Kong Exchanges and Clearing Limited

CONSENT SOLICITATION IN RELATION TO 9.0% SENIOR NOTES DUE APRIL 2024 (ISIN: XS2085883119, COMMON CODE: 208588311) 9.0% SENIOR NOTES DUE JUNE 2024 (ISIN: XS2120092882, COMMON CODE: 212009288) 9.0% SENIOR NOTES DUE JULY 2024 (ISIN: XS1720216388, COMMON CODE: 172021638) 9.0% SENIOR NOTES DUE OCTOBER 2024 (ISIN: XS2238030162, COMMON CODE: 223803016) AND 9.0% SENIOR NOTES DUE DECEMBER 2024 (ISIN: XS2227909640, COMMON CODE: 222790964)

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"The principal purposes of the Consent Solicitation are (1) to improve our liquidity and cash flow management by extending the maturity and lowering the interest rates of the Notes and implementing the payment of principal of the Notes in instalments and (2) to provide us with additional time to cure the November Interest Non-Payment (as defined below) by providing a waiver until 19 July 2024 and of all past defaults that arose as a consequence of it, among other matters."

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"BACKGROUND AND PURPOSE OF THE CONSENT SOLICITATION

During the latter half of 2021, Chinese property developers and the capital markets that have funded growth and development of the sector have experienced an inflection point. Since then reduced bank lending for real estate development has adversely affected access by property developers to onshore capital. Reduced bank lending for mortgage finance for buyers, combined with buyers’ concerns about the ability of property developers to complete projects, has adversely affected property sales. In addition, the use of pre-sale proceeds is also restricted under the applicable PRC laws. Negative reaction to these onshore events by offshore capital markets has curtailed our funding sources to address upcoming maturities. In 2022 and 2023, the property sector in China has continued to experience volatility. More and more negative credit events among property developers have intensified market concerns over the operations of Chinese property developers. As a result, pre-sale of Chinese property developers has generally decreased. We also experienced a noticeable decline of our aggregate contracted sales in recent months. In addition, the recent depreciation of Renminbi against US dollars negatively affected our ability to repay US dollar denominated debts.

We have experienced, and are expected to continue to experience, significant liquidity and cash flow constraints as a result of the deteriorating operating environment affecting the real estate sector in the PRC. We have not made an interest payment due on 20 November 2023 (“November Interest”) with respect to the July 2024 Notes (“November Interest Non-Payment”) which would lead to an event of default on 20 December 2023 if the November Interest is not paid by such date. We may not have sufficient available funds to make such interest payments before 20 December 2023. As such, if the Requisite Consents are not received by 20 December 2023, it may trigger an event of default under other indebtedness, that could cause us to fail to meet payment obligations under our outstanding indebtedness, which would have a significant material adverse effect on our business, operations and financial condition, including possibly insolvency or other forms of restructuring. Such developments would adversely affect the interests of the Holders, including those that did not give their Consent to the Proposed Amendments and Waivers.

We have been actively seeking to obtain financing and working on generating sufficient cash flow to meet our financial commitments. As part of these efforts, we are conducting the Consent Solicitation to afford us more time and operational flexibility to obtain such financing. Specifically, the Consent Solicitation will allow us (1) to improve our liquidity and cash flow management by extending the maturity and lowering the interest rates of the Notes and implementing the payment of principal of the Notes in instalments and (2) to provide us with additional time to cure the November Interest Non-Payment by providing a waiver until 19 July 2024 and of all past defaults that arose as a consequence of it, among other matters."

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