廈門國際港務股份有限公司 Xiamen International Port Co

71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ACTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountants or other professional adviser. If you have sold or transferred all your shares in Xiamen International Port Co., Ltd., you should at once hand this circular to the purchaser or the transferee or to the bank, stockbroker or other agent through whom the sale or the transfer was effected for transmission to the purchaser and transferee. Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, 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 circular.

廈門國際港務股份有限公司 XIAMEN INTERNATIONAL PORT CO., LTD* (A joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 3378)

RENEWAL OF CONTINUING CONNECTED TRANSACTIONS

AND

NOTICE OF THE THIRD EXTRAORDINARY GENERAL MEETING IN 2015

Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders

A letter from the Board is set out on pages 6 to 33 of this circular. A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 34 of this circular. A letter from the Independent Financial Adviser, First Shanghai Capital Limited, containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 35 to 66 of this circular. A notice dated 13 November 2015 convening the EGM of the Company to be held at 23rd Floor, Conference Room, No.31 Donggang North Road, Xiamen, PRC on Wednesday, 30 December 2015 at 9:00 a.m. is set out on pages 70 to 71 of this circular. Whether or not you are able to attend the EGM, you are requested to complete and return the enclosed form of proxy in accordance with the instructions printed thereon as soon as practicable and in any event by not later than 24 hours before the time appointed for holding the meeting or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting or at any adjourned meeting should you so wish. 13 November 2015

* For identification purpose only 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

CONTENTS

Pages

Definitions ...... 1

Letter from the Board ...... 6

Letter from the Independent Board Committee ...... 34

Letter from the Independent Financial Adviser ...... 35

Appendix — General Information ...... 67

Notice of the EGM ...... 70

— i — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

DEFINITIONS

In this circular, the following expressions have the following meanings unless the context requires otherwise:

“2013 Comprehensive Services the comprehensive services agreement dated 23 October 2013 Agreement” entered into between Xiamen Port Holding, the Company and Xiamen Port Development in relation to the provision of certain comprehensive services to Xiamen Port Development and its subsidiaries

“2013 EGM” the extraordinary general meeting of the Company convened on 31 December 2013, at which the then Independent Shareholders have approved, inter alia, the continuing connected transactions contemplated under the 2013 General Services Agreements and the Annual Caps applicable thereto

“2013 General Services Agreements” the 2013 Master Property Services Agreement, the 2013 Comprehensive Services Agreement, the 2013 Master Project Management Agreement, the 2013 Master Engineering Agreement and the 2013 Master Labour Services Agreement, the continuing connected transactions contemplated thereunder and the Annual Caps applicable thereto were approved by the then Independent Shareholders at the 2013 AGM

“2013 Master Engineering the master agreement dated 23 October 2013 entered into between Agreement” the Company and Xiamen Port Holding in relation to the provision of certain engineering services to the Group

“2013 Master Labour Services the master agreement dated 23 October 2013 entered into between Agreement” the Company and Xiamen Port Services in relation to the provision of certain port-related labour services to the Group

“2013 Master Project Management the master agreement dated 23 October 2013 entered into between Agreement” the Company and Xiamen Port D&C in relation to the provision of construction project management services to the Group

“2013 Master Property Services the master agreement dated 23 October 2013 entered into between Agreement” the Company and Xiamen Port Construction in relation to the provision of certain property management and/or security or logistical services to the Group

“2015 Comprehensive Services the comprehensive services agreement dated 20 October 2015 Agreement” entered into between Xiamen Port Holding, the Company and Xiamen Port Development in relation to the provision of certain comprehensive services to Xiamen Port Development and its subsidiaries

“2015 General Services Agreements” the 2015 Master Property Services Agreement, the 2015 Comprehensive Services Agreement, the 2015 Master Project Management Agreement, the 2015 Master Engineering Agreement and the 2015 Master Labour Services Agreement

— 1 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

DEFINITIONS

“2015 Master Engineering the master agreement dated 20 October 2015 entered into between Agreement” the Company and Xiamen Port Holding in relation to the provision of certain engineering services to the Group

“2015 Master Labour Services the master agreement dated 20 October 2015 entered into between Agreement” the Company and Xiamen Port Holding in relation to the provision of certain port-related labour services to the Group

“2015 Master Project Management the master agreement dated 20 October 2015 entered into between Agreement” the Company and Xiamen Port Construction in relation to the provision of construction project management services to the Group

“2015 Master Property Services the master agreement dated 20 October 2015 entered into between Agreement” the Company and Xiamen Port Construction in relation to the provision of certain logistical and/or property management services to the Group

“Annual Caps” the maximum aggregate annual values

“associate(s)” has the meaning ascribed to it in the Listing Rules

“Board” the board of Directors of the Company

“Company” 廈門國際港務股份有限公司 (Xiamen International Port Co., Ltd*), a joint stock limited company incorporated in the PRC, the H Shares of which are listed on the Stock Exchange

“connected person(s)” has the meaning ascribed to it in the Listing Rules

“controlling shareholder” has the meaning ascribed to it in the Listing Rules

“Director(s)” the director(s) of the Company

“EGM” the extraordinary general meeting of 2015 of the Company to be held on Wednesday, 30 December 2015 to consider and, if thought fit, to approve the continuing connected transactions contemplated under, and the Annual Caps applicable to, the 2015 General Services Agreements

“Fujian HURD” 福建省住房和城鄉建設廳 (Department of Housing and Urban- Rural Development of Fujian Province*)

“Group” the Company and its subsidiaries

“H Shares” the ordinary shares issued by the Company, with a Renminbi denominated par value of RMB1.00, which are subscribed for and traded in Hong Kong dollar and are listed on the Stock Exchange

“Hong Kong” the Hong Kong Special Administrative Region of the PRC

— 2 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

DEFINITIONS

“Independent Board Committee” an independent board committee, comprising all of the independent non-executive Directors, namely Mr. Liu Feng, Mr. Hui Wang Chuen, Mr. Lin Pengjiu, Mr. Huang Shumeng and Mr. Shao Zheping, formed to advise the Independent Shareholders in respect of the 2015 General Services Agreements

“Independent Financial Adviser” or First Shanghai Capital Limited, acting as the independent financial “First Shanghai” adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the 2015 General Services Agreements, a licensed corporation to carry out type 6 (advising on corporate finance) regulated activity under the SFO

“Independent Shareholder(s)” the shareholder(s) of the Company other than Xiamen Port Holding and its associates

“Latest Practicable Date” 9 November 2015, being the latest practicable date prior to the printing of this circular for ascertaining certain information contained herein

“Listing” the listing of the H Shares of the Company on the Stock Exchange on 19 December 2005

“Listing Rules” the Rules Governing the Listing of Securities on the Stock Exchange

“MHURD” 中華人民共和國住房和城鄉建設部 (Ministry of Housing and Urban-Rural Development of PRC*)

“MOT” 中華人民共和國交通運輸部 (Ministry of Transport of the PRC*)

“percentage ratios” the five percentage ratios as set out in Rule 14.07 of the Listing Rules

“PRC” the People’s Republic of China which, for the purpose of this circular, excludes Hong Kong, Macau and Taiwan

“Required Labour Contributions” the labour-related social welfare contributions (i.e. endowment insurance, medical insurance, unemployment insurance, employment injury insurance, maternity insurance (if applicable) and housing provident fund) required to be made by both employers and employees (at different rates based on the employee’s salary) in accordance with the relevant rules and regulations of PRC;

“RMB” Renminbi, the lawful currency of the PRC

“SFO” Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong)

— 3 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

DEFINITIONS

“Share(s)” shares of nominal value RMB1.00 each in the share capital of the Company

“Shareholders” shareholders of the Company

“Stock Exchange” The Stock Exchange of Hong Kong Limited

“substantial shareholder” has the meaning ascribed to it in the Listing Rules

“Supervisor(s)” the supervisor(s) of the Company

“Working Day” a day (other than a Saturday, Sunday or public holiday in Hong Kong) when banks in Hong Kong are open for business

“XCB” 廈門市建設局 (Xiamen Municipality Construction Bureau*)

“XCTG” 廈門集裝箱碼頭集團有限公司 (Xiamen Container Terminal Group Co., Ltd.*), a non-wholly owned subsidiary of the Company

“XFB” 廈門市財政局 (Xiamen Municipality Finance Bureau*)

“Xiamen DRC” 廈門市發展和改革委員會 (Xiamen Development and Reform Commission*)

“Xiamen HRSS” 廈門市人力資源和社會保障局 (Xiamen Municipal Human Resources and Social Security Bureau*)

“Xiamen HRSS Notice” the Notice of Wages Guideline for Certain Types of Works (Positions) in Xiamen Municipal* 《廈門市部分工種（職位）工( 資指導價位的通知》) issued by Xiamen HRSS on a yearly basis, which sets out guidance monthly wages (in the form of fixed (i.e. non-adjustable) prescribed sums) for nearly 400 types of works (positions) in 18 industries in Xiamen

“Xiamen LTB” 廈門市地方稅務局 (Xiamen Local Taxation Bureau*)

“Xiamen Port Construction” 廈門港務建設集團有限公司 (Xiamen Port Construction Group Co., Ltd.*) (formerly known as 廈門港務建設有限公司 (Xiamen Port Construction Co., Ltd. *))

“Xiamen Port Development” 廈門港務發展股份有限公司 (Xiamen Port Development Co., Ltd.*), a non wholly-owned subsidiary of the Company, whose A Shares are listed on the Shenzhen Stock Exchange since April 1999 and which is held as to 55.13% by the Company

“Xiamen Port D&C” 廈門港口開發建設有限公司 (Xiamen Port Development and Construction Co., Ltd.*)

— 4 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

DEFINITIONS

“Xiamen Port Holding” 廈門港務控股集團有限公司 (Xiamen Port Holding Group Co., Ltd.*), a wholly State-owned company incorporated in the PRC and the controlling shareholder of the Company with approximately 63.14% share interest in the Company

“Xiamen Port Holding Group” Xiamen Port Holding and its subsidiaries

“Xiamen Port Services” 廈門港務服務有限公司 (Xiamen Port Services Co., Ltd.*, formerly known as 廈門港務集團勞動服務有限公司 (Xiamen Port Group Labour Services Co., Ltd. *))

“XPB” 廈門市物價局 (Xiamen Municipal Pricing Bureau*)

“%” per cent

* For identification purpose only

— 5 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

廈門國際港務股份有限公司 XIAMEN INTERNATIONAL PORT CO., LTD* (A joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 3378)

Executive Directors: Registered office: Lin Kaibiao No.439 Gangnan Road Fang Yao Haicang District Huang Zirong Xiamen Ke Dong Fujian Province PRC Non-executive Directors: Zheng Yongen Principal place of business in Hong Kong Chen Dingyu 36/F, Tower Two Fu Chengjing Times Square 1 Matheson Street Independent Non-Executive Directors: Causeway Bay Liu Feng Hong Kong Hui Wang Chuen Lin Pengjiu Huang Shumeng Shao Zheping

13 November 2015

To the Shareholders

Dear Sir or Madam,

RENEWAL OF CONTINUING CONNECTED TRANSACTIONS

AND

NOTICE OF THIRD EXTRAORDINARY GENERAL MEETING IN 2015

INTRODUCTION

Reference is made to the Company’s announcement dated 20 October 2015, in which the Board announced that, inter alia, the Group has entered into the 2015 General Services Agreements to further renew the 2013 General Services Agreements in accordance with their respective provisions for a further term of three years expiring on 31 December 2018.

* For identification purpose only

— 6 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

As Xiamen Port Holding is the Company’s controlling shareholder and is a connected person of the Company, the transactions contemplated under the 2015 General Services Agreements constitute continuing connected transactions of the Company for the purpose of Chapter 14A of the Listing Rules.

As some of the percentage ratios relating to the proposed Annual Caps for the transactions contemplated under the 2015 General Services Agreements are expected to exceed the 5% threshold on an aggregate basis under Chapter 14A of the Listing Rules, such continuing connected transactions will be subject to the reporting, announcement and independent shareholders’ approval requirements. In addition, the transactions contemplated under the 2015 General Services Agreements, when aggregated, also constitute discloseable transactions for the Company and are subject to the notification and announcement requirements under Rule 14.34 of the Listing Rules.

GENERAL

Details of the 2015 General Services Agreements will be disclosed in the Company’s next published annual report and accounts, as required under Rules 14A.49 and 14A.71 of the Listing Rules.

An Independent Board Committee, comprising all of the independent non-executive Directors, namely Mr. Liu Feng, Mr. Hui Wang Chuen, Mr. Lin Pengjiu, Mr. Huang Shumeng and Mr. Shao Zheping, has been formed to advise the Independent Shareholders in respect of the 2015 General Services Agreements. The Company has appointed First Shanghai to advise the Independent Board Committee and the Independent Shareholders in respect thereof.

The Board (including the independent non-executive Directors) is of the view that (i) the principal terms of the 2015 General Services Agreements (including, without limitation, the scope of services contemplated thereunder as well as the pricing basis and the payment terms of such services) have no material changes as compared to that in the 2013 General Services Agreements; and (ii) the 2015 General Services Agreements and the transactions contemplated thereunder have been entered into in the ordinary and usual course of business of the Group, that they are on normal commercial terms (including the fees to be paid or received by the Group thereunder), that they will be implemented in accordance with the terms contained therein, and that the terms, as well as the Annual Caps applicable thereto, are fair and reasonable and in the interests of the Company and its shareholders as a whole.

The purpose of this circular is to provide you with information regarding the resolution to be approved at the EGM relating to the 2015 General Services Agreements and the continuing connected transactions contemplated thereunder and the proposed Annual Caps.

CONTINUING CONNECTED TRANSACTIONS WITH XIAMEN PORT HOLDING AND/OR ITS ASSOCIATES

2015 General Services Agreements

1. 2015 Master Property Services Agreement

a. Background

Xiamen Port Construction has been retained by certain members of the Group to provide property management and/or security and logistical services for the operation of the container terminals owned by the Group and the management of the Group’s office premises. In this connection, the Company entered into a master property services agreement with Xiamen Port Construction on 23 October 2013, the terms of which will expire on 31 December 2015.

— 7 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

In order to secure the on-going provision of these services to the Group, the Company and Xiamen Port Construction have entered into a master property services agreement on 20 October 2015 to retain Xiamen Port Construction to provide these services for a further term of three years from 1 January 2016 until 31 December 2018.

b. Connected person

Xiamen Port Construction is a wholly-owned subsidiary of Xiamen Port Holding, a controlling shareholder of the Company. Accordingly, Xiamen Port Construction is a connected person of the Company.

c. Principal terms of the 2015 Master Property Services Agreement

Type of services and charge rates

• Provision of property management and security services for the office premises and terminal area.

• Provision of hygiene and cleaning services.

• Provision of food and beverage for staff.

• Provision of environmental and landscaping services.

The charges under the 2015 Master Property Services Agreement shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Construction in accordance with the following pricing principles:

(a) by reference to the relevant pricing guideline issued by Xiamen DRC, XCB and XPB from time to time (including, without limitation, (i) the Notice relating to the Announcement of the Classification Standards and Guidance Fees of Residential Premises in Xiamen Municipal* 《關於公佈廈門市住宅物業服務等級標準( 及收費指導價的通知》) issued by XCB and XPB in October 2008 which sets out the general guiding pricing principles as to the provision of general property management services relating to, inter alia, industrial factory building and office premises in Xiamen that the relevant service charges should be freely negotiated between the service provider and the service recipient so as to encourage positive price competition; and (ii) the various notices issued by Xiamen DRC and XCB which contains prescribed rates for the provision of certain specific types of property management services in Xiamen, such as RMB40 to RMB60 per month for car park space management service depending on the class of services and RMB4 per square metre for first time construction waste disposal service and RMB6 per square metre for any additional service thereafter); and

(b) taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Construction and its subsidiaries (the historical range of which is approximately 3% to 5% as to residential premises and approximately 6% to 10% as to office premises) by reference to historical rate.

— 8 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Accordingly, in view of the above, the Board currently expects that most of the relevant charges will be negotiated and determined by the parties in good faith in accordance with the pricing principle set out in sub-paragraph (b) above.

Charges incurred will be settled on a monthly basis through bank transfer.

Opt-out

The Company has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Construction pursuant to the 2015 Master Property Services Agreement.

Term and termination

The term of the 2015 Master Property Services Agreement will commence on 1 January 2016 and expire on 31 December 2018. In the event that the agreement and the proposed Annual Caps for the three years ending 31 December 2018 are not approved by the Independent Shareholders at the EGM, the agreement will then be terminated immediately, otherwise, the term of the agreement will continue until 31 December 2018. In addition, the parties may extend the term from six months prior to 31 December 2018, unless such agreement has been otherwise terminated prior to 31 December 2018.

Implementation agreements

The parties to the 2015 Master Property Services Agreement (including their respective relevant subsidiaries) may, from time to time, enter into separate implementation agreements for each specific transaction contemplated under the 2015 Master Property Services Agreement to reflect the detailed requirements of the Group. The terms and conditions of these implementation agreements shall follow the binding principles, guidelines and terms as set out in the 2015 Master Property Services Agreement.

The Directors are of the view that the implementation agreements are simply further elaboration on the provision of services as contemplated under the 2015 Master Property Services Agreement and therefore, those agreements shall not constitute new categories of connected transactions.

d. Reasons for and benefits of entering into the transactions

The relevant transactions commenced from July 2002. As Xiamen Port Construction and its subsidiaries possess extensive experience in property management in Xiamen and are experienced and accustomed to the operation of the Group’s port business, the Directors believe that it is practical and efficient from the perspective of the Group’s operations and is beneficial to the Group as a whole to retain Xiamen Port Construction to provide these relevant services. Retaining Xiamen Port Construction to provide the relevant services would also ensure operational continuity and minimise any disruptions to the operations and business of the Group.

— 9 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

e. Historical figures and Annual Caps

Please refer to the section headed “Annual Caps” for historical figures and the proposed Annual Caps for the 2015 Master Property Services Agreement.

The Annual Caps for the 2015 Master Property Services Agreement for the three years ending 31 December 2018 are arrived at after taken the following specific factors into account:

(a) historical transaction amounts, in particular the contribution of the provision of property management and security services for the office premises and terminal area at approximately 48% to the estimated aggregate transaction amounts during the term of the 2013 Master Property Services Agreement;

(b) prevailing market rates in Xiamen gathered by the Group prior to the signing of the 2015 Master Property Services Agreement;

(c) estimated organic annual growth in the international trade and domestic trade handling throughput of the Group during the relevant period by approximately 7–12% per year;

(d) estimated consequential annual growth in the demand for ancillary services at the terminals operated by the Group during the relevant period driven by the aforesaid estimated organic growth in the Group’s international trade and domestic trade handling throughput;

(e) the estimated contribution of the provision of property management and security services for the office premises and terminal area at approximately 48% to the estimated aggregate transaction amounts during the term of the 2015 Master Property Services Agreement;

(f) estimated annual increase in the service fees payable by the Group due to price and labour cost inflation by approximately 5–10% per year; and

(g) reasonable upward margin ranging from 17.5% to 20.2% reserved for each year during the term for contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

By comparison with the actual transaction amount for the eight months ended 31 August 2015 as disclosed in the section headed “Annual Caps”, the Directors currently expect that the fees payable by the Group in the year of 2016 would be substantially higher on the assumption that (i) the estimated transaction amount for the full year ending 31 December 2015 would attain at approximately RMB16,400,000 given that most of the outstanding contractual sums payable by the Group by 2015 will be settled near the end of the year; (ii) the Group’s demand for property management services would be substantially increased in 2016 mainly attributable to the four newly acquired terminals upon the formation of XCTG with reference to the anticipated substantial growth of the actual transaction amount in the year of 2015 of approximately 54.7% over that of 2014 as it expects that the operating efficiency/capability of such newly acquired terminals will be gradually improved over the next three years (provided the construction/variation/rectification works relating thereto can be completed on time), which will lead to an increase of such demand for such newly completed operating port areas and the new building structures erected thereon; and (iii) the average annual wage paid in Xiamen would achieve an annual growth rate of approximately 10.4% during the term of the 2015 Master Property Services Agreement with reference to the statistics released by Xiamen LTB.

— 10 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

f. Implications under the Listing Rules

As all applicable percentage ratios of the transactions contemplated under the 2015 Master Property Services Agreement for the three years ending 31 December 2018 are expected to be above 0.1% but less than 5%, the 2015 Master Property Services Agreement will be subject to the reporting and announcement requirements, but is exempted from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules.

2. 2015 Comprehensive Services Agreement

a. Background

Xiamen Port Holding Group has been retained by Xiamen Port Development to provide certain comprehensive services to Xiamen Port Development and its subsidiaries (the “Xiamen Port Development Group”) for the operation of the general cargo terminals and other port businesses owned by Xiamen Port Development Group. In this connection, Xiamen Port Holding, the Company and Xiamen Port Development have entered into a comprehensive services agreement on 23 October 2013 for a term of two years expiring on 31 December 2015.

Xiamen Port Holding, the Company and Xiamen Port Development have entered into a new comprehensive services agreement on 20 October 2015 to renew the 2013 Comprehensive Services Agreement for a further term of three years expiring on 31 December 2018.

b. Connected person

Xiamen Port Holding is a controlling shareholder of the Company and is therefore a connected person of the Company under the Listing Rules.

c. Principal terms of the 2015 Comprehensive Services Agreement

Type of services and charge rates

In general, the charges under the 2015 Comprehensive Services Agreement shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Holding Group accordance with the following pricing principles:

(a) by reference to (i) the relevant pricing guideline relating to minimum wage standard for the labour market issued by Xiamen HRSS from time to time (i.e. the Xiamen HRSS Notice); and (ii) the Required Labour Contributions in Xiamen; and

(b) taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding Group by reference to historical rate.

— 11 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Description of the specific type of services to be provided by Xiamen Port Holding Group and their particular pricing terms are as follows:

• Provision of staff quarters and ancillary facilities to certain employees of Xiamen Port Development Group. The rates to be charged for the relevant services will be the same as or not higher than those charged by Xiamen Port Holding to its own employees and the employees of Xiamen Port Development Group will directly pay for the charges. In this regard, (i) the charge for the provision of such facilities will amount to approximately RMB500 to RMB800 per month depending on the floor area of the staff quarters; and (ii) the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (i.e. staff quarters service staff) as stated in the Xiamen HRSS Notice is approximately RMB2,023 to RMB3,668 per month per person.

• Provision of canteen and ancillary services to the employees of Xiamen Port Development Group. The fees for the relevant services will be the same as those charged by Xiamen Port Holding to its own employees and the employees of Xiamen Port Development Group will directly pay for the charges. In this regard, (i) the average rate for the provision of such services will amount to approximately RMB12 to RMB20 per head per visit; and (ii) the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (i.e. food and beverage service staff) as stated in the Xiamen HRSS Notice is approximately RMB1,936 to RMB4,325 per month per person.

• Provision of environmental, hygiene and landscaping services for the office, port areas and terminal areas of Xiamen Port Development Group. The fees for such services will be calculated based on the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (which include environmental hygiene staff, cleaners and greening staff) ranging from RMB1,866 to RMB4,037 per month per person as set out in the Xiamen HRSS Notice and in accordance with the abovementioned pricing principles. After taking the estimated Required Labour Contributions into account (i.e. approximately RMB760 per month), it is currently expected that the average wage of the relevant service employees will amount to approximately RMB3,325 per month per person.

• Provision of labour services for container/cargo loading and unloading at the berths operated by Xiamen Port Development Group. The rates to be charged for the provision of such services are the actual labour costs calculated based on the prescribed wage applicable to the relevant service employees of Xiamen Port Holding Group (i.e. longshoremen) ranging from RMB3,506 to RMB8,581 per month per person as set out in the Xiamen HRSS Notice and the internal charging standard of Xiamen Port Holding, plus a 5% management fee. After taking the estimated Required Labour Contributions into account (i.e. approximately RMB859 per month), it is currently expected that the average wage of the relevant service employees will amount to approximately RMB5,824 per month per person.

Unless otherwise agreed by the parties, charges incurred by Xiamen Port Development Group will be settled on a monthly basis.

— 12 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Opt-out

Xiamen Port Development has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group pursuant to the 2015 Comprehensive Services Agreement.

Term and termination

The term of the 2015 Comprehensive Services Agreement will commence on 1 January 2016. In the event that the agreement and the proposed Annual Caps for the three years ending 31 December 2018 are not approved by the Independent Shareholders at the EGM, the agreement will then be terminated immediately, otherwise, the term of the agreement will continue until 31 December 2018. In addition, the parties may extend the term from six months prior to 31 December 2018, unless such agreement has been terminated in accordance with its term prior to 31 December 2018.

d. Reasons for and benefits of entering into the transactions

The relevant services have been provided to Xiamen Port Development Group from mid-2003. The Directors believe that such on-going comprehensive services are practical and efficient from the perspective of the Group’s operations and such transactions are beneficial to the Group as a whole since Xiamen Port Holding Group possesses the required facilities, staff and experience to deliver the services. Based on previous transactions with the Group, relevant members of Xiamen Port Holding Group are experienced and accustomed to the operations of port business of the Group and hence have a sound understanding of the standards and quality required for the relevant services. Retaining Xiamen Port Holding Group to provide the relevant services would also ensure operational continuity and minimise any disruptions to the operations and business of the Group.

e. Historical figures and Annual Caps

Please refer to the section headed “Annual Caps” for historical figures and the proposed Annual Caps for the 2015 Comprehensive Services Agreement.

The Annual Caps for the 2015 Comprehensive Services Agreement for the three years ending 31 December 2018 are arrived at after taken the following specific factors into account:

(a) historical transaction amounts, in particular the contribution of the provision of (i) labour services for container/cargo loading and unloading services and (ii) the other comprehensive services at approximately 90% and 10% to the estimated aggregate transaction amounts during the term of the 2013 Master Property Services Agreement respectively;

(b) prevailing market rates in Xiamen gathered by the Group prior to the signing of the 2015 Comprehensive Services Agreement;

(c) estimated organic annual growth in the operation volume at the general cargo terminals operated by Xiamen Port Development Group during the relevant period, being 16% for the year 2016, 8% for the year 2017 and 8% for the year 2018;

(d) estimated consequential annual growth in the demand for port ancillary services operated by Xiamen Port Development Group during the relevant period;

— 13 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

(e) the estimated contribution of the provision of (i) labour services for container/cargo loading and unloading services and (ii) the other comprehensive services at approximately 92% and 8% to the estimated aggregate transaction amounts during the term of the 2015 Master Property Services Agreement; and

(f) reasonable upward margin reserved for each year for contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

By comparison with the actual transaction amount for the eight months ended 31 August 2015 as disclosed in the section headed “Annual Caps”, the Directors currently expect that the fees payable by the Group in the year of 2016 would be substantially higher on the assumption that (i) the estimated transaction amount for the full year ending 31 December 2015 would attain at approximately RMB26,500,000 given that most of the outstanding contractual sums payable by the Group by 2015 will be settled near the end of the year; (ii) the Group’s estimated annual growth in the operation volume at the general cargo terminals would attain a significant increase of up to 16% over that of 2015 as a result of the planned commencement of operation of berths no.20 to no.21 of Haicang port area by December 2016, followed by a gradual organic annual growth at approximately 8% in 2017 and 2018 respectively driven by a stable increase in the throughput handled by Xiamen Port Development Group; and (iv) the average annual wage paid in Xiamen would achieve an annual growth rate of approximately 10.4% during the term of the 2015 Master Property Services Agreement with reference to the statistics released by Xiamen LTB.

f. Implications under the Listing Rules

As all applicable percentage ratios of the transactions contemplated under the 2015 Comprehensive Services Agreement for the three years ending 31 December 2018 are expected to be above 0.1% but less than 5%, the 2015 Comprehensive Services Agreement will be subject to the reporting and announcement requirements, but is exempted from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules.

3. 2015 Master Project Management Agreement

a. Background

The Company entered into a master construction project management agreement with Xiamen Port D&C on 23 October 2013, appointing Xiamen Port D&C to manage the Group’s construction projects for a term of two years expiring on 31 December 2015. From 1 January 2016, these management services will be provided by Xiamen Port Construction in substitution of Xiamen Port D&C.

In order to secure such services for a further term of three years ending 31 December 2018, the Company and Xiamen Port Construction have entered into a new master construction project agreement on 20 October 2015.

b. Connected person

Xiamen Port Construction is a wholly-owned subsidiary of Xiamen Port Holding. Accordingly, Xiamen Port Construction is a connected person of the Company.

— 14 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

c. Principal terms of the 2015 Master Project Management Agreement

Type of services and charge rates

In general, the charges under the 2015 Master Project Management Agreement shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Construction accordance with the following pricing principles:

(a) if applicable, by reference to the relevant pricing guideline issued by the relevant construction project management authorities at the national, Fujian provincial and Xiamen municipal levels from time to time (i.e. the Notice of Adjustment of the Calculating Standards for Construction Management Charges under Fiscal Investment and Financing Project* 《關於調整我市財政性投融資項目建設單位管理費計取( 標準的通知》) issued by XFB in 2011 which sets out, inter alia, the calculation and allocation basis and standards as to construction project management fees relating to construction projects in Xiamen Municipality (the “XFB Notice”)); and

As at the date of this circular, as far as the Board is aware, the only relevant pricing guideline in place applicable to the determination of the charges under the 2015 Master Project Management Agreement is the XFB Notice.

Description of the specific type of services to be provided by Xiamen Port Construction and their particular pricing terms are as follows:

• Provision of project management services to the Group in respect of projects involving the construction of berths or other port-related facilities and infrastructure, which include management of project bidding, land requisition and clearance and project construction. The fees for such services are determined with reference to the abovementioned pricing principles, with such appropriate adjustments agreed by the parties due to the estimated workload, building materials and equipment required, as well as complexity and technical uniqueness in port-related construction projects, details of which are set out below:

(1) construction safety management fee: up to 2% of the construction budget if the budget is equal to or exceeds RMB1,000,000,000, and up to 2.5% if the construction budget is below RMB1,000,000,000; in case of building construction, 3% of the project settlement price;

(2) pre-construction management fee: 2.5% of the actual amount incurred at the pre- construction stage;

(3) bidding and cost consultation management fee: for bidding management fee, 0.18% of the bidding control price; for cost consultation management fee, 0.4% of the control price; and

— 15 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

(4) other management fee: 1% of the actual compensation paid for land expropriation.

The construction safety management fee is determined broadly in line with the spirit of the fee structure consisting regressively decreasing fixed percentage rates as to tower block construction projects set out in the XFB Notice (i.e. (i) 3% if the construction budget is below RMB30,000,000; (ii) 2.5% if the construction budget is between RMB30,000,000 and RMB50,000,000; and (iii) 2% if the construction budget is above RMB50,000,000), whilst the pricing terms of the remaining types of management fees are determined by taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Construction by reference to historical rate as the XFB Notice has no relevant and applicable rates in this regard.

• If Xiamen Port Construction is able to manage the construction projects such that the final costs fall below the budgeted amount, it will be entitled to a bonus fee in an amount equal to 20% of the difference between the budget and the final cost; and

• If the final costs of the project managed by Xiamen Port Construction are higher than the budgeted amount, it will pay the Company the difference between the final costs and the budgeted amount up to a maximum amount equivalent to 40% of the management fee that it is entitled to, provided that the difference is not caused by (i) a change of law or government policies; (ii) factors attributed to the Company; (iii) force majeure events; or (iv) material change of circumstances.

The brief procedures for determining the budgeted amount of each on-going or planned port-related project as contemplated under the 2015 Master Project Management Agreement are as follows:

(a) drafting of preliminary construction plan based on (i) the feasibility report prepared by professional architectural design institutes after on-site inspection; and (ii) estimated workload, building materials and equipment required, as well as the complexity and technical uniqueness of the project;

(b) preparation of initial budgetary estimates based on such preliminary construction plan and in strict accordance with the allocation basis as stipulated in the XFB Notice that project management fees shall be allocated as follows: (i) 20% to the project owner and 80% to the project manager; and (ii) 100% to the project manager if all works are conducted by the project manager solely;

(c) confirmation of final construction plan after audit of the initial budgetary estimates by the relevant governmental authority (which is usually the Xiamen DRC);

(d) preparation of final budget based on the confirmed final construction plan; and

(e) confirmation of the final budget after independent audit.

— 16 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

The fees will be settled in accordance with the terms of the implementation agreements (see below), in the absence of which, they will be settled through bank transfer within 30 days after completion of the relevant construction project. Xiamen Port Construction’s services relate primarily to construction project management and they will retain contractors to undertake the construction works through public bidding/tendering or by other means pursuant to the 2015 Master Project Management Agreement and the Company’s authorisations from time to time.

Opt-out

Term and termination

The term of the 2015 Master Project Management Agreement will commence on 1 January 2016. In the event that the agreement and the proposed Annual Caps for the three years ending 31 December 2018 are not approved by the Independent Shareholders at the EGM, the agreement will then be terminated immediately, otherwise, the term of the agreement will continue until 31 December 2018 and is then subject to renewal upon agreement by the parties, unless it is terminated by the Company unilaterally by giving three months prior written notice to Xiamen Port Construction before the expiration of the contractual term.

Implementation agreements

The members of the Group may, from time to time, enter into separate implementation agreements with Xiamen Port Construction under the 2015 Master Project Management Agreement to reflect the detailed requirements and settlement terms of the relevant services. The terms and conditions of these implementation agreements must follow the binding principles, guidelines and terms as set out in the 2015 Master Project Management Agreement.

The Directors are of the view that the implementation agreements are simply for further elaboration on the provision of services as contemplated under the 2015 Master Project Management Agreement and therefore, those agreements shall not constitute new categories of connected transactions.

d. Reasons for and benefits of entering into the transactions

The Directors believe that it is in the Company’s best interest to enter into the 2015 Master Project Management Agreement having considered the following factors:

• port construction and management business are capital intensive and the use of construction project management services is customary for complex construction projects. Outsourcing of project management services allows the Group to concentrate its financial and management resources on its core business operations; and

• the staff of Xiamen Port Construction possesses extensive port construction experience and are experienced in managing the Group’s construction projects.

— 17 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

e. Historical figures and Annual Caps

Please refer to the section headed “Annual Caps” for historical figures and the Annual Caps for the 2015 Master Project Management Agreement.

The Annual Caps for the 2015 Master Project Management Agreement for the three years ending 31 December 2018 are arrived at after taken the following specific factors into account:

(a) historical transaction amounts;

(b) estimated aggregate annual capital expenditure budgeted for the Group’s on-going and planned projects during the relevant period, including, without limitation, (i) construction projects of berths no.20 to no.21 of Haicang port area; (ii) dredging and related works at the turning basins of Xiamen Songyu Terminal and other terminals at Haicang port area; (iii) engineering projects relating to the expansion of the freight terminal at Chaozhou port; (iv) major construction projects relating to Ji’an land-based port in Jiangxi Province and Sanming land-based port in Fujian Province; (v) works relating to the construction of the inter-connection highway at Zhangzhou Gulei and the related berths at Zhangzhou Longchi; and (vi) maintenance works of the Group’s certain berth-related highways, storage yards and construction facilities;

(c) estimated workload, building materials and equipment required, as well as complexity and technical uniqueness of each of the abovementioned projects; and

(d) reasonable upward margin reserved for each year for possible project construction cost inflation and other contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

Details of the Group’s on-going and planned projects mentioned in sub-paragraph (b) above are as follows:

Commencement and Project Nature completion date Budgeted amount

Construction projects of Construction of two bulk/ Commenced in December RMB1,437,000,000 berths no.20 to no.21 of general cargo berths of 2012 and expect to complete Haicang port area 50,000 tonnes and 70,000 construction and handover in tonnes respectively December 2016

Dredging and related works Dredging works including Works at Xiamen Songyu RMB121,000,000 at the turning basins of earthworks and reef Terminal: commenced in Xiamen Songyu Terminal blasting at the turning June 2014 and expect to and other terminals basins and port basins complete construction and at Haicang port area of berths no.1 to no.3 of handover in January 2016 Xiamen Songyu Terminal and other terminals at Works at other terminals: Haicang port area (such as to be commenced in due Xinhaida Terminal) course during the term of the 2015 Master Engineering Agreement — 18 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Commencement and Project Nature completion date Budgeted amount

Engineering projects relating Construction of Commenced in June 2014 RMB490,000,000 to the expansion of the a 5,000-tonnes general and expect to complete freight terminal cargo berth and construction and handover at Chaozhou port a 5,000 tonnes in June 2016 multi-purpose berth

Major construction projects (i) Construction of six (i) To be commenced in RMB180,000,000 relating to Ji’an land-based warehouses with a total May 2016 and expect port in Jiangxi Province plot area of to hand over in and Sanming land-based approximately 40,000 December 2016 and port in Fujian Province square metre and a road complete in June 2017 yard of approximately 40,000 square metre as part of Ji’an land-based port’s phase two construction project

(ii) Construction of four (ii) To be commenced in electronic commerce May 2016 and expect warehouses of to hand over in approximately 4,798.25 December 2016 and square metre each and complete in June 2017 office buildings and other areas of approximately 62,553 square metre for the electronic commerce distribution centre in the logistics park at Sanming land-based port

(iii) Construction of two (iii) Commenced in warehouses with a total November 2014, area of approximately handed over in May 10,000 square metre and 2015 and expect to road yards of complete in approximately 36,000 February 2016 square metre in the storage public area at Sanming land-based port

— 19 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Commencement and Project Nature completion date Budgeted amount

Works relating to the (i) Construction of road (i) Commenced in January RMB867,000,000 construction of the inter- access to the Zhangzhou 2013, handed over in connection highway Gulei port area with December 2015 at Zhangzhou Gulei and the a total length of 5.15 km and expect to complete related berths at Zhangzhou in December 2016 Lonchi (ii) Land reclamation and (ii) Pre-construction works to construction of be commenced in two bulk/general berths June 2016 and expect to at Zhangzhou Longchi hand over in December 2020 and complete in December 2021

Maintenance works of the “From oil to electricity” Commenced in July 2015 and RMB70,000,000 Group’s certain berth-related transformation works expected to complete in highways, storage yards and relating to the yards and March 2016 construction facilities equipment at Haitian terminal and Xiangyu terminal

The budgeted amount of each of the above projects is arrived at after at arm’s length negotiation between the relevant members of the Group and Xiamen Port Holding Group in good faith by (i) reliance on the knowledge base of past projects of similar size, nature, scope and location; (ii) taking into account of the estimated capital cost based on the workload, building materials and equipment required, as well as the complexity and technical uniqueness of each project and by reference to the abovementioned pricing guideline issued by the various governmental authorities; and (iii) inclusion of a contingency amount as an insurance policy to cover unforeseen conditions or requirements.

In addition, as the Company may not have full control over the development process of the construction projects, and that the capital expenditure throughout the development phases of construction projects may not be evenly spread out from one year to the next, the Directors have considered the possibility that a large amount of capital expenditure may incur within one single year. In addition, the Directors have assumed that the Company will pay the maximum management fee at the rate of 2.5% in calculating the Annual Caps, which is applicable to the transactions contemplated under the 2015 Master Project Management Agreement.

— 20 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

f. Implications under the Listing Rules

As all applicable percentage ratios of the transactions contemplated under the 2015 Master Project Management Agreement for the three years ending 31 December 2018 are expected to be above 0.1% but less than 5%, the 2015 Master Project Management Agreement will be subject to the reporting and announcement requirements, but is exempted from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules.

4. 2015 Master Engineering Agreement

a. Background

Xiamen Port Holding Group has been providing services relating to the engineering and maintenance of berths, depots and other port-related facilities and the cleaning of voyage channel to various members of the Group. In this connection, the Company entered into a master engineering services agreement with Xiamen Port Holding on 23 October 2013 for a term of two years expiring on 31 December 2015.

To continue the transactions for a further term of three years ending 31 December 2018, the parties have entered into a new master agreement on 20 October 2015, which contains the principles and terms and conditions upon which Xiamen Port Holding Group shall provide the relevant services to the members of the Group.

b. Connected person

Xiamen Port Holding is a controlling shareholder of the Company and therefore is a connected person of the Company under the Listing Rules.

c. Principal terms of the 2015 Master Engineering Agreement

Type of services and charge rates

Xiamen Port Holding Group will provide the Group with services in relation to (i) berth construction and maintenance and voyage channel clearing and maintenance; (ii) berth structure and facilities renovation and maintenance; (iii) building construction and interior engineering; and (iv) other related port engineering services that the relevant parties may agree in the implementation agreements (see below) from time to time. None of the members of the Group carries out the aforesaid business except certain minor regular maintenance during its daily operations.

The charges under the 2015 Master Engineering Agreement shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Holding Group in accordance with the following pricing principles:

(a) by reference to and in strict accordance with, if any, the relevant pricing guideline issued by MOT and MHURD, Fujian HURD and other relevant government authorities from time to time (including, without limitation, (i) the Notice relating to the Announcement of the Requirements for Formulation of Budgetary Estimates and Final Budget for Coastal Port Construction Works and Ancillary Fixed Sums* 《關( 於發佈沿海港口建設工程概預算編製規定及配套定額的通知》) issued by

— 21 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

MOT in 2004 which sets out the pricing standards for coastal port construction works in Xiamen (typical components of which include main construction items, ancillary production construction items, public works and amenities works); (ii) the Code of Bills of Quantities and Valuation for Construction Works 《建設工程工程量清單( 計價規範》) issued by MHURD effective from July 2013 which regulates the pricing methods for contracting and implementation of construction works in PRC and in particular, provides that actual pricing of construction works shall be estimated by taking into account of the following components: (i) fees for work sections and trades; (ii) fees for preliminaries; (iii) fee for other items; (iv) statutory fees; and (v) tax; and (iii) the notices issued by Fujian HURD as to consumption of construction materials in respect of different types of works in Xiamen, such as construction works, installation works and urban services works); and

The Group will make payments in instalments under the 2015 Master Engineering Agreement upon signing of the relevant implementation agreements (see below), during the course of services by way of progress payments and upon completion of the post-construction inspection respectively, which is the prevailing industry practice for port-related construction projects conducted in the PRC.

Opt-out

The Company has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group pursuant to the 2015 Master Engineering Agreement.

Term and termination

The term of the 2015 Master Engineering Agreement will commence on 1 January 2016. In the event that the agreement and the proposed Annual Caps for the three years ending 31 December 2018 were not approved by the Independent Shareholders at the EGM, the agreement will then be terminated immediately, otherwise, the term of the agreement will continue until 31 December 2018 and is then subject to renewal upon agreement by the parties, unless it is terminated by the Company unilaterally by giving three months prior written notice to Xiamen Port Holding during the contractual term.

Implementation agreements

The members of the Group and Xiamen Port Holding Group may, from time to time, enter into separate implementation agreements under the 2015 Master Engineering Agreement, to reflect the detailed requirements of the relevant services. The terms and conditions of these implementation agreements must follow the binding principles, guidelines and terms as set out in the 2015 Master Engineering Agreement.

The Directors are of the view that the implementation agreements are simply for further elaboration on the provision of services as contemplated under the 2015 Master Engineering Agreement and therefore, those agreements shall not constitute new categories of connected transactions.

— 22 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

d. Reasons for and benefits of entering into the transactions

Xiamen Port Holding Group has been engaged in providing engineering and maintenance services to the Group prior to and since the Listing. The Directors believe that such on-going services are practical and efficient from the perspective of the Group’s operations and such transactions are beneficial to the Group as a whole since Xiamen Port Holding Group possesses the required experience and staff to undertake such functions. Based on previous transactions with the Group, relevant members of Xiamen Port Holding Group are experienced and accustomed to the operations of port business of the Group and hence have a sound understanding of the standards and quality required for the relevant services. Retaining Xiamen Port Holding Group to provide the relevant services would also ensure operational continuity and minimise any disruptions to the operations and business of the Group.

e. Historical figures and Annual Caps

Please refer to the section headed “Annual Caps” for historical figures and the Annual Caps for the 2015 Master Engineering Agreement.

The Annual Caps for the 2015 Master Engineering Agreement for the three years ending 31 December 2018 are arrived at after taken the following specific factors into account:

(a) historical transaction amounts;

(b) the number and extent of the Group’s on-going and planned new construction works during the relevant period;

(c) the Group’s facilities maintenance and renovation plan during the relevant period, assuming that all such works will be undertaken by Xiamen Port Holding Group;

(d) estimated aggregate annual capital expenditure budgeted for the Group’s on-going and planned projects during the relevant period, including, without limitation, (i) construction projects of berths no.20 to no.21 of Haicang port area; (ii) dredging and related works at the turning basins of Xiamen Songyu Terminal and other terminals at Haicang port area; (iii) engineering projects relating to the expansion of the freight terminal at Chaozhou port; (iv) major construction projects relating to Ji’an land-based port in Jiangxi Province and Sanming land-based port in Fujian Province; (v) works relating to the construction of the inter-connection highway at Zhangzhou Gulei and the related berths at Zhangzhou Lonchi; and (vi) maintenance works of the Group’s certain berth-related highways, storage yards and construction facilities;

(e) estimated workload, building materials and equipment required, as well as complexity and technical uniqueness of each of the abovementioned projects; and

(f) reasonable upward margin reserved for each year for possible project construction cost inflation and other contingency reasons (such as emergency repair or irregular maintenance), the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

— 23 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Please refer to the section headed “Historical figures and Annual Caps” relating to the 2015 Master Project Management Agreement above for details of the Group’s on-going and planned projects mentioned in sub-paragraph (d) above and the basis for determining the relevant budgeted amount.

By comparison with the actual transaction amount for the eight months ended 31 August 2015 as disclosed in the section headed “Annual Caps”, the Directors expect that the fees payable by the Group in the year of 2016 would be substantially higher on the assumption that (i) the estimated transaction amount for the full year ending 31 December 2015 would attain at approximately RMB53,075,525 given that most of the outstanding contractual sums payable by the Group by 2015 will be settled near the end of the year; (ii) engineering and maintenance works and services for the Group’s existing and additional port facilities would be increased as the four newly acquired terminals to be included under the Group would result in a much stronger business foundation and much larger port areas to be occupied accordingly for its port operations; and (iii) most of the key planned construction and maintenance works would be commenced starting from 2016.

f. Implications under the Listing Rules

As all applicable percentage ratios of the transactions contemplated under the 2015 Master Engineering Agreement for the three years ending 31 December 2018 are expected to be above 0.1% but less than 5%, the 2015 Master Engineering Agreement will be subject to the reporting and announcement requirements, but is exempted from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules.

5. 2015 Master Labour Services Agreement

a. Background

There are certain ongoing transactions between members of Xiamen Port Holding Group and members of the Group with respect to the provision of port-related labour services by these connected persons of the Company to the Group.

In this connection, the Company entered into a master labour services agreement with Xiamen Port Services on 23 October 2013 for a term of two years expiring on 31 December 2015. From 1 January 2016, these labour services will be provided by Xiamen Port Holding Group in substitution of Xiamen Port Services.

To continue the transactions for a further term of three years ending 31 December 2018, the Company and Xiamen Port Holding have entered into a new master agreement on 20 October 2015 setting out the principles and terms and conditions upon which Xiamen Port Holding Group will provide the relevant port labour services to the members of the Group.

b. Connected person

Xiamen Port Holding is a controlling shareholder of the Company and therefore is a connected person of the Company under the Listing Rules.

— 24 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

c. Principal terms of the 2015 Master Labour Services Agreement

Type of services and charge rates

In general, the charges under the 2015 Master Labour Services Agreement shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Holding Group in accordance with the following pricing principles:

(a) by reference to the relevant pricing guideline relating to minimum wage standard for the labour market issued by Xiamen HRSS from time to time, including, without limitation, the Xiamen HRSS Notice; and

(b) taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding by reference to historical rate.

Description of the specific type of services to be provided by Xiamen Port Holding Group and their particular pricing terms are as follows:

The relevant labour services include (i) bundling and unbundling of the reinforced components of container and general cargo; (ii) bulk cargo packaging and unwrapping; (iii) container mantling and dismantling; and (iv) other ancillary labour services agreed by the contracting parties.

The fees of such services are pre-determined at a fixed standard rate as set out in the 2015 Master Labour Services Agreement with reference to (i) the prevailing market rates when entering into such agreement; (ii) based on the pricing principles as mentioned above; and (iii) the prescribed rate applicable to the provision of such services ranging from RMB3,506 to RMB8,581 per month per person as set out in the Xiamen HRSS Notice, subject to adjustment within a range of 10% each year over the preceding year’s rates with reference to prevailing governmental index of consumer price and local market rates.

Unless otherwise agreed by the parties in the implementation agreements (see below), charges incurred will be settled on a monthly basis through bank transfer.

Opt-out

The Company has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group pursuant to the 2015 Master Labour Services Agreement.

Term and termination

The term of the 2015 Master Labour Services Agreement will commence on 1 January 2016. In the event that the agreement and the proposed Annual Caps for the three years ending 31 December 2018 are not approved by the Independent Shareholders at the EGM, the agreement will then be terminated immediately, otherwise, the term of the agreement will continue until 31 December 2018 and is then subject to renewal upon agreement by the parties, unless it is terminated by the Company unilaterally by giving three months prior written notice to Xiamen Port Holding before the expiration of the contractual term.

— 25 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Implementation agreements

Members of the Group may, from time to time, enter into separate implementation agreements with members of the Xiamen Port Holding Group under the 2015 Master Labour Services Agreement to reflect the detailed requirements of the relevant services. The terms and conditions of these implementation agreements must follow the binding principles, guidelines and terms as set out in the 2015 Master Labour Services Agreement.

The Directors are of the view that the implementation agreements are simply for further elaboration on the provision of services as contemplated under the 2015 Master Labour Services Agreement and therefore, those agreements shall not constitute new categories of connected transactions.

d. Reasons for and benefits of entering into the transactions

Xiamen Port Holding Group has been engaged in the provision of labour services to the Group prior to and since the Listing. The Directors believe that such on-going labour services are practical and efficient from the perspective of the Group’s operations and such transactions are beneficial to the Group as a whole since Xiamen Port Holding Group possesses the required labour force and experience. Based on previous transactions with the Group, relevant members of Xiamen Port Holding Group are experienced and accustomed to the operations of port business of the Group and hence have a sound understanding of the standards and quality required for the relevant services. Retaining Xiamen Port Holding Group to provide the relevant services would also ensure operational continuity and minimise any disruptions to the operations and business of the Group.

e. Historical figures and Annual Caps

Please refer to the section headed “Annual Caps” for historical figures and the Annual Caps for the 2015 Master Labour Services Agreement.

The Annual Caps of the 2015 Master Labour Services Agreement for the three years ending 31 December 2018 are arrived at after taken the following specific factors into account:

(a) historical transaction amounts;

(b) estimated organic annual growth in the international and domestic trade handling throughput of the Group during the relevant period by approximately 7–12% per year;

(c) estimated consequential annual growth in the demand for manpower and labour services at the terminals operated by the Group during the relevant period driven by the aforesaid estimated organic growth in the Group’s international and domestic trade handling throughput;

(d) estimated annual increase in the service fees payable by the Group due to price and labour cost inflation by approximately 5–10% per year; and

(e) reasonable upward margin ranging from 17% to 17.8% reserved for each year during the term for contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

— 26 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

By comparison with the actual transaction amount for the eight months ended 31 August 2015 as disclosed in the section headed “Annual Caps”, the Directors expect that the fees payable by the Group in the year of 2016 would be substantially higher on the assumption that (i) the estimated transaction amount for the full year ending 31 December 2015 would attain at approximately RMB45,147,466 given that most of the outstanding contractual sums payable by the Group by 2015 will be settled near the end of the year; (ii) the Group’s demand for labour services would be substantially increased with current estimate of additional labour costs up to RMB44,500,000 to be incurred by and consolidated into the Group over the coming three years in consideration of the Group’s proposed leases and operation of newly completed berths from corresponding parties and its proposed acquisition of further equity interests in certain terminals already operated by the Group; and (iii) the average annual wage paid in Xiamen would achieve an annual growth rate of approximately 10.4% during the term of the 2015 Master Labour Services Agreement with reference to the statistics released by Xiamen LTB.

f. Implications under the Listing Rules

As all applicable percentage ratios of the transactions contemplated under the 2015 Master Labour Services Agreement for the three years ending 31 December 2018 are expected to be above 0.1% but less than 5%, the 2015 Master Labour Services Agreement will be subject to the reporting and announcement requirements, but is exempted from the independent shareholders’ approval requirement under Chapter 14A of the Listing Rules.

Continuing connected transactions and discloseable transactions contemplated under the 2015 General Services Agreements

All applicable percentage ratios of the transactions contemplated under each of the 2015 General Services Agreements for the three years ending 31 December 2018 are only expected to be above 0.1% but less than 5% on a stand-alone basis. Nevertheless, as (i) all these agreements are conducted between the Group and Xiamen Port Holding and/or its associates; (ii) the services rendered thereunder are of a similar nature; and (iii) the Group is in the position to pay services fees under these agreements, the transactions under the 2015 General Services Agreements are aggregated. Since some of the applicable percentage ratios of the proposed Annual Caps for the transactions contemplated under the 2015 General Services Agreements for the three years ending 31 December 2018 are expected to exceed the 5% threshold on an aggregate basis under Chapter 14A of the Listing Rules, such continuing connected transactions will be subject to the reporting, announcement and independent shareholders’ approval requirements.

In addition, the transactions contemplated under the 2015 General Services Agreements, when aggregated, also constitute discloseable transactions for the Company and are subject to the notification and announcement requirements under Rule 14.34 of the Listing Rules.

— 27 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

ANNUAL CAPS

Set out below are (i) the Annual Caps of the 2013 General Services Agreements approved at the 2013 EGM; (ii) the audited historical amounts of the 2013 General Services Agreements for the one year ending 2014; and (iii) the unaudited historical amounts of the 2013 General Services Agreements for the eight months ended 31 August 2015:

Historical Annual Caps For the year ended amounts for the for the year 31 December 2014 eight months ending Historical Annual ended 31 December Agreements amounts Caps 31 August 2015 2015

2013 Master Property Services Agreement RMB10,602,000 RMB36,000,000 RMB8,826,653 RMB38,000,000

2013 Comprehensive Services Agreement RMB25,716,000 RMB33,000,000 RMB15,611,883 RMB38,000,000

2013 Master Project Management Agreement RMB18,388,000 RMB35,000,000 RMB287,200 RMB35,000,000

2013 Master Engineering Agreement RMB12,415,000 RMB65,000,000 RMB27,415,818 RMB65,000,000

2013 Master Labour Services Agreement RMB32,850,000 RMB95,000,000 RMB25,136,508 RMB110,000,000

As far as the Directors are aware, none of the Annual Caps for the period ending 31 December 2015 has been exceeded as at the date of this circular.

Under Rule 14A.53 of the Listing Rules, in respect of a continuing connected transaction which is not fully exempted, a cap must be set and disclosed. The expected Annual Caps for each of the transactions contemplated under the 2015 General Services Agreements are set out below:

Paragraph Annual Caps for Annual Caps for Annual Caps for number under the year ending the year ending the year ending this circular Agreements 31 December 2016 31 December 2017 31 December 2018

1 2015 Master Property Services RMB24,000,000 RMB26,000,000 RMB27,000,000 Agreement

2 2015 Comprehensive Services RMB34,500,000 RMB37,500,000 RMB40,800,000 Agreement

3 2015 Master Project Management RMB28,500,000 RMB28,500,000 RMB28,500,000 Agreement

4 2015 Master Engineering Agreement RMB180,000,000 RMB197,000,000 RMB210,000,000

5 2015 Master Labour Services RMB100,000,000 RMB120,000,000 RMB135,000,000 Agreement

2015 General Services Agreements RMB367,000,000 RMB409,000,000 RMB441,300,000 (after aggregation)

— 28 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

INFORMATION OF THE GROUP AND THE CONNECTED PERSONS

The Group

The Group is the largest port terminal operator in Xiamen, PRC. It is also the only group providing full scale ancillary value-added port services in Xiamen. The Group is principally engaged in, inter alia, (i) container loading and unloading and storage for international and domestic trade; (ii) bulk/general cargo loading and unloading and storage for international and domestic trade; and (iii) ancillary value-added port services, including shipping agency, tallying, tugboat berthing and unberthing and port-related logistics in Xiamen.

Xiamen Port Holding

Xiamen Port Holding is the controlling shareholder of the Company with 63.14% equity interest in the Company. It is principally engaged in, inter alia, (i) management and operation of certain state-owned assets; (ii) investment in different areas such as port, terminal, logistics, information, real estate, hotel, property, tourism and trading; (iii) providing financing; (iv) investment in financial institutions; (v) port development; (vi) environmental consultancy services in respect of sea pollution; (vii) information products development; and (viii) providing other port-related services.

Xiamen Port Construction

Xiamen Port Construction is a wholly-owned subsidiary of Xiamen Port Holding and its principal business includes integrated land development, management of development and construction of port, road and ancillary works, project construction management technical consultation, as well as provision of property management, logistics and security services.

LISTING RULES IMPLICATIONS

As some of the percentage ratios relating to the proposed Annual Caps for the transactions contemplated under the 2015 General Services Agreements for the three years ending 31 December 2018 are expected to exceed the 5% threshold on an aggregate basis under Chapter 14A of the Listing Rules, such continuing connected transactions will be subject to the reporting, announcement and independent shareholders’ approval requirements. In addition, the transactions contemplated under the 2015 General Services Agreements, when aggregated, also constitute discloseable transactions for the Company and are subject to the notification and announcement requirements under Rule 14.34 of the Listing Rules.

Details of the 2015 General Services Agreements will be disclosed in the Company’s next published annual report and accounts, as required under Rules 14A.49 and 14A.71 of the Listing Rules.

— 29 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

BOARD OPINION AND INTERNAL CONTROL MEASURES

The Board (including the independent non-executive Directors) is of the view that (i) the principal terms of the 2015 General Services Agreements (including, without limitation, the scope of services contemplated thereunder as well as the pricing basis and the payment terms of such services) have no material changes as compared to that in the 2013 General Services Agreements; and (ii) the 2015 General Services Agreements and the transactions contemplated thereunder have been entered into in the ordinary and usual course of business of the Group, that they are on normal commercial terms (including the fees to be paid or received by the Group thereunder), that they will be implemented in accordance with the terms contained therein, and that the terms, as well as the Annual Caps applicable thereto, are fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

The Group has established stringent internal control procedures to ensure that the fees to be paid and received by the Group, and the pricing basis of the transactions contemplated under the 2015 General Services Agreements will be fair and reasonable and on normal commercial terms or better, including, without limitation:

(a) the finance department of the Group will use all commercially reasonable endeavours to periodically (and in any event at least every three months) request the counterparty to provide their prices and transaction records relating to the transactions with other connected or independent third parties for the Group’s internal assessment and evaluation before entering into any implementation agreements pursuant to the 2015 General Services Agreements by comparing such records provided by the relevant members of Xiamen Port Holding Group with the terms of transactions in similar nature and of similar size that have been conducted between the Group and other independent third parties;

(b) the finance department of the Group will use all commercially reasonable endeavours to periodically (and in any event at least every three months) gather market intelligence from a sufficient number of independent third parties in Xiamen for internal analysis. In addition, given that comparable transactions in the local market are available as to the transactions contemplated under the 2015 General Services Agreement, it will also compare the terms quoted from the relevant members of Xiamen Port Holding Group relating to the transactions contemplated under the 2015 General Services Agreement with the quoted terms from at least two independent third parties in Xiamen providing services of similar nature (if available) to ascertain the comparable local average market price in Xiamen in order to ensure that the most favourable terms can be obtained by the Group before entering into any implementation agreements pursuant to the 2015 General Services Agreements;

(c) the operational units of the Group shall report the relevant transaction values in respect of the transactions contemplated under the 2015 General Services Agreements in writing to the finance department of the Group on a monthly basis;

(d) the secretariat of the Board and the finance department of the Group have implemented effective internal rules and policies that proactively and specifically monitors records and the transaction values in respect of the transactions contemplated under the 2015 General Services Agreements on a regular basis to ensure (i) strict adherence to the pricing principles and terms as agreed in the 2015 General Services Agreements; and (ii) the respective actual aggregated

— 30 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

transaction amounts will not exceed the relevant Annual Caps, such as (i) conducting monthly and random internal independent examination and audit; and (ii) providing regular training to the management team of the Group’s operating units to strengthen and enhance their understanding of the importance and operation of the relevant reporting and disclosure requirements under the Listing Rules;

(e) the Group’s Company Secretary in Xiamen is authorised by the Board to (i) coordinate, supervise and assess the intra-group check-and-balance mechanisms so as to identify financial and operational irregularities (if any) which may arise from the execution of the 2015 General Services Agreements; and (ii) closely scrutinise any development or update of the relevant PRC and Hong Kong laws and regulations (including, without limitation, the PRC governmental pricing guidelines applicable to the pricing of the transactions contemplated under the 2015 General Services Agreement and the requirements under Chapter 14A of the Listing Rules) and properly brief the Board, the finance department and the operational units of the Group so as to ensure strict adherence to the abovementioned pricing guidelines and legal and regulatory compliance in a timely manner;

(f) the entering into of any implementation agreements in respect of the transactions contemplated under the 2015 General Services Agreements shall be jointly approved by an Executive Director designated by the Board for such specific purpose and the Company’s General Manager;

(g) the external auditors of the Company will be engaged to review the transaction values in respect of the transactions contemplated under the 2015 General Services Agreements in compliance with the annual reporting and review requirements under the Listing Rules and provide confirmation in the Company’s annual report on whether such transaction are entered into in the ordinary course of business on normal commercial terms or better and are carried out pursuant to the terms thereof, and whether the terms thereof are fair and reasonable and in the interests of the Company and the Shareholders as a whole;

(h) the Company’s Audit Committee will review the implementation of the 2015 General Services Agreement at least twice a year as part of its review of the operation and effectiveness of the Company’s internal control procedures; and

(i) the independent non-executive Directors will conduct an annual review of the implementation of the 2015 General Services Agreement pursuant to the requirement under the Listing Rules.

In view of the above and the Group’s discretion to exercise its opt-out rights under the 2015 General Services Agreements, the Board considers that sufficient and effective internal control measures are in place to ensure that the transactions contemplated under the 2015 General Services Agreements will be conducted on normal commercial terms or better and at prices not more favourable to the relevant members of the Xiamen Port Holding Group than transactions entered into with independent third parties and hence will not prejudicial to the interests of the Group and the Shareholders as a whole. In addition, (i) as at the date of this circular and to the best of the Board’s knowledge, belief and information, having made all reasonable enquiries, there is no circumstance relating to the entering into and the terms of the 2015 General Services Agreements which is unfavourable to the Group; and (ii) the Board (including the independent non-executive Directors) is of the view that the principal terms of the 2015 General Services Agreements (including, without limitation, the scope of services contemplated thereunder as well as the pricing basis and the payment terms of such services) have no material changes as compared to that in the 2013 General Services Agreements.

— 31 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

Since (i) Mr. Lin Kaibiao is the deputy general manager of Xiamen Port Holding; (ii) each of Mr. Zheng Yongen, Mr. Chen Dingyu and Mr. Fu Chengjing is a director of Xiamen Port Holding; and (iii) Mr. Huang Zirong is the chief engineer of Xiamen Port Holding, they are deemed to have a material interest in the 2015 General Services Agreements, each of them is required to abstained, and has abstained, from voting on the resolutions passed by the Board for approving the entering into and the terms of the relevant agreements and the transactions contemplated thereunder as required under the Listing Rules and the applicable rules and regulations.

The Board recommends the Independent Shareholders to vote in favour of the resolution to approve the 2015 General Services Agreements and the continuing connected transactions contemplated thereunder and the proposed Annual Caps.

THE EGM

A notice convening the EGM of the Company to be held at 23rd Floor, Conference Room, No.31 Donggang North Road, Xiamen, PRC on Wednesday, 30 December 2015 at 9:00 a.m. is set out on pages 70 to 71 of this circular, at which ordinary resolutions will be proposed to approve the continuing connected transactions contemplated under the 2015 General Services Agreements and the proposed Annual Caps applicable thereto.

Pursuant to Rule 14A.36 of the Listing Rules, any shareholder with a material interest in the relevant connected transaction is required to abstain from voting on the relevant resolution at the EGM. Accordingly, as at the Latest Practicable Date, Xiamen Port Holding and its associates, with approximately 63.14% share interest in the Company, are required to abstain from voting on the relevant resolution at the EGM.

The relevant forms of proxy and attendance slip are enclosed. Shareholders who intend to attend the EGM are required to complete and return the attendance slip to the Company on or before Thursday, 10 December 2015.

Whether or not Shareholders are able to attend the EGM, they are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return it, as soon as practicable and in any event by not later than 24 hours before the time designated for holding the EGM. Completion and return of the form of proxy will not preclude Shareholders from attending and voting in person at the EGM should they so wish.

Pursuant to Rule 13.39(4) of the Listing Rules, any vote of the Shareholders to be taken at a general meeting of the Company shall be taken by poll. An announcement of the poll results will be made by the Company after the EGM in the manner prescribed under Rule 13.39(5) of the Listing Rules.

— 32 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE BOARD

RECOMMENDATION OF THE INDEPENDENT BOARD COMMITTEE

An Independent Board Committee, comprising all of the independent non-executive Directors, namely Mr. Liu Feng, Mr. Hui Wang Chuen, Mr. Lin Pengjiu, Mr. Huang Shumeng and Mr. Shao Zheping, has been formed to advise the Independent Shareholders in respect of the 2015 General Services Agreements. A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on page 34 of this circular.

The Company has appointed First Shanghai as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders as to whether the transactions contemplated under the 2015 General Services Agreements are on normal commercial terms, in the ordinary and usual course of business of the Group, fair and reasonable and in the interests of the Company and its Shareholders as a whole as well as whether the proposed Annual Caps are fair and reasonable. A letter from the Independent Financial Adviser containing its advice to the Independent Board Committee and the Independent Shareholders in this regard is set out on pages 35 to 66 of this circular.

ADDITIONAL INFORMATION

Shareholders’ attention is drawn to the notice of the EGM set out on pages 70 to 71 of this circular and the additional information set out in the appendix to this circular.

By order of the Board Xiamen International Port Co., Ltd. Yang Hongtu Joint Company Secretary

— 33 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M45

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

廈門國際港務股份有限公司 XIAMEN INTERNATIONAL PORT CO., LTD* (A joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 3378)

To the Independent Shareholders 13 November 2015

Dear Sir or Madam,

RENEWAL OF CONTINUING CONNECTED TRANSACTIONS

We refer to the circular dated 13 November 2015 of the Company (the “Circular”) of which this letter forms part. Terms defined in the Circular have the same meanings herein unless the context otherwise requires.

We have been appointed as members of the Independent Board Committee to consider the terms of the 2015 General Services Agreements and to advise the Independent Shareholders whether, in our opinion, the terms of the 2015 General Services Agreements are fair and reasonable so far as the Independent Shareholders are concerned and are in the interests of the Company and the Shareholders as a whole. First Shanghai has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

Your attention is drawn to the “Letter from the Board” set out on pages 6 to 33 of the Circular which contains, inter alia, information about the 2015 General Services Agreements, and the “Letter from the Independent Financial Adviser” set out on pages 35 to 66 of the Circular which contains its advice in respect of the terms of the 2015 General Services Agreements and the additional information set out in the appendix to this Circular.

Having considered the advice given by, and the principal factors and reasons taken into consideration by the Independent Financial Adviser in arriving at its advice, we consider that the terms of the 2015 General Services Agreements are fair and reasonable so far as the Independent Shareholders are concerned, on normal commercial terms and in the ordinary and usual course of business of the Group, and are in the interests of the Company and the Shareholders as a whole. We, therefore, recommend the Independent Shareholders to vote in favour of the ordinary resolution to be proposed at the EGM to approve the 2015 General Services Agreements as set out in the notice convening such meeting on pages 70 to 71 of the Circular.

Yours faithfully, For and on behalf of the Independent Board Committee

Mr. Liu Mr. Hui Mr. Lin Mr. Huang Mr. Shao Feng Wang Chuen Pengjiu Shumeng Zheping Independent Independent Independent Independent Independent Non-executive Non-executive Non-executive Non-executive Non-executive Director Director Director Director Director

* For identification purpose only

— 34 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of the letter of advice to the Independent Board Committee and the Independent Shareholders from the Independent Financial Adviser regarding the continuing connected transactions contemplated under the 2015 General Services Agreements, comprising (i) the 2015 Master Property Services Agreement, (ii) the 2015 Comprehensive Services Agreement, (iii) the 2015 Master Project Management Agreement, (iv) the 2015 Master Engineering Agreement and (v) the 2015 Master Labour Services Agreement (the “Continuing Connected Transactions”) and the proposed Annual Caps, for the purpose of incorporation into this circular.

19th Floor Wing On House 71 Des Voeux Road Central Hong Kong

13 November 2015

To the Independent Board Committee and the Independent Shareholders

Xiamen International Port Co., Ltd. No.439, Gangnan Road Haicang District Xiamen City Fujian Province The PRC

Dear Sirs,

RENEWAL OF CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

We refer to our engagement as the independent financial adviser to the Independent Board Committee and the Independent Shareholders in respect of the entering into of the 2015 General Services Agreements, the Continuing Connected Transactions and the proposed Annual Caps applicable thereto, details of which are contained in the circular of the Company to the Shareholders dated 13 November 2015 (the “Circular”), of which this letter forms part. Unless the context requires otherwise, capitalised terms used in this letter shall have the same meanings as those ascribed in the Circular.

Given (i) Xiamen Port Holding is the controlling shareholder of the Company and therefore is a connected person of the Company; and (ii) some of the percentage ratios relating to the proposed Annual Caps for the Continuing Connected Transactions are expected to exceed the 5% threshold on an aggregate basis, the Continuing Connected Transactions (together with the proposed Annual Caps) constitute non- exempt continuing connected transactions of the Company for the purposes of Chapter 14A of the Listing Rules. Accordingly, the Continuing Connected Transactions will be subject to the reporting, announcement and Independent Shareholders’ approval requirements. In this connection, Xiamen Port Holding and its associates are required to abstain from voting in respect of the Continuing Connected Transactions and the proposed Annual Caps at the EGM. — 35 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In addition, the transactions contemplated under the 2015 General Services Agreements, when aggregated, also constitute discloseable transactions of the Company and are subject to the notification and announcement requirements under Rule 14.34 of the Listing Rules.

The Independent Board Committee, comprising all of the five independent non-executive Directors, namely Mr. Liu Feng, Mr. Hui Wang Chuen, Mr. Lin Pengjiu, Mr. Huang Shumeng and Mr. Shao Zheping, has been established to advise the Independent Shareholders, taking into account our recommendations set out in this letter, (i) as to whether the terms of the Continuing Connected Transactions (together with the proposed Annual Caps) are conducted on normal commercial terms or better and in the ordinary and usual course of business of the Group, are fair and reasonable so far as the Independent Shareholders are concerned, and are in the interests of the Company and the Shareholders as a whole; and (ii) on how to vote at the EGM in respect of the Continuing Connected Transactions and the proposed Annual Caps. The advice of the Independent Board Committee as regards the Continuing Connected Transactions and the proposed Annual Caps is contained in its letter included in the Circular.

As the Independent Financial Adviser, we have been appointed to advise the Independent Board Committee and the Independent Shareholders as to (i) whether the Continuing Connected Transactions (together with the proposed Annual Caps) are conducted on normal commercial terms or better and in the ordinary and usual course of business of the Group, are fair and reasonable so far as the Independent Shareholders are concerned, and are in the interests of the Company and the Shareholders as a whole; and (ii) how the Independent Shareholders should vote in relation to the ordinary resolution to be proposed for approving the Continuing Connected Transactions and the proposed Annual Caps contemplated under the 2015 General Services Agreements at the EGM.

BASIS OF OUR OPINION

In formulating our opinion, we have relied on the information and statements supplied, opinions and representations expressed by the Company and its senior management including the Directors (the “Management”) and have assumed that all such information and statements supplied, opinions and representations expressed to us were true, accurate and complete in all material aspects at the time they were provided and continue to be true up to the date of the EGM. We have also sought and obtained confirmation from the Company that no material facts have been omitted from the information and statements supplied as well as opinions and representations expressed to us.

We consider that we have been provided with sufficient information to enable us to reach our advice and recommendations as set out in this letter and to justify our reliance on the accuracy of such information. We have no reason to suspect that any material facts or information (which are known to the Company) have been omitted or withheld from the information or statements supplied, or opinions or representations expressed to us nor to doubt the truth and accuracy of the information and statements supplied, or the reasonableness of the opinions and representations expressed to us. We have not, however, carried out any independent verification on the information provided to us by the Company and the Directors, nor have we conducted an independent in-depth investigation into the business or affairs or future prospects of the Group.

The Independent Shareholders should note that, within the past two years from the Latest Practicable Date, we were engaged as the independent financial adviser by the Company for one occasion in the similar nature to the Continuing Connected Transactions this time (i.e. mainly in relation to the provision of independent financial advice to the then Independent Board Committee and then Independent Shareholders for, among others, the previous renewal of certain continuing connected transactions of the Company) as detailed in the circular of the Company dated 15 November 2013. Given (i) our independent role in that

— 36 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER previous engagement; (ii) none of the members of our parent group is a direct party to the 2015 General Services Agreements; and (iii) our fees for this present engagement in addition to that previous engagement represented an insignificant percentage of revenue of our parent group, we consider that the said previous engagement would not affect our independence to form our opinion in respect of the entering into of the 2015 General Services Agreements, the Continuing Connected Transactions and the proposed Annual Caps applicable thereto.

PRINCIPAL FACTORS AND REASONS CONSIDERED

We have taken into account the following principal factors and reasons in arriving at our recommendations with regard to the Continuing Connected Transactions and the proposed Annual Caps:

1. Background of the Group

The Group is the largest port terminal operator in Xiamen Municipal, Fujian Province, the PRC. It is also the only group providing full-scale ancillary value-added port services in Xiamen Municipal. The Group is principally engaged in, inter alia, (i) container loading and unloading and storage for international and domestic trade; (ii) bulk/general cargo loading and unloading and storage for international and domestic trade; and (iii) ancillary value-added port services, including shipping agency, tallying, tugboat berthing and unberthing and port-related logistics in Xiamen. The H Shares have been listed on the Main Board of the Stock Exchange since 19 December 2005.

Following completion of the formation of XCTG (which was referred to in the circular of the Company dated 6 May 2013 (the “JV Formation”)), the Group currently operates six container terminals, namely the Haitian Container Terminal, Xiamen International Container Terminal, Haicang International Container Terminal, Hairun Terminal and Songyu Terminal, Xinhaida Terminal, as well as Dongdu Terminal and ITG Terminal, which operating bulk/general cargo business in respect of both international and domestic trade. The Group currently operates a total of 26 berths, the aforesaid terminal berths are capable of accommodating the largest container vessels in the world. Shipping routes have been developed from the container terminals to major ports in Europe, the United States, the Mediterranean, Australia, Southeast Asia and Japan. The container terminals are also connected to major domestic shipping routes. In addition, the Group has leased Haicang berth No.8 in the Haicang port area of Xiamen port for operation, and also leased berth No.8 in the Qingzhou Operating Area of Mawei port area, Fuzhou Municipal for operation, so as to meet the needs of business development. The Group’s container handling throughput will be significantly enhanced after completion of the JV Formation.

2. Background of Xiamen Port Holding

Xiamen Port Holding is the controlling shareholder of the Company with 63.14% shareholding interest in the Company. It is principally engaged in, inter alia, (i) management and operation of certain state-owned assets; (ii) investment in different areas such as port, terminal, logistics, information, real estate, hotel, property, tourism and trading; (iii) providing financing; (iv) investment in financial institutions; (v) port development; (vi) environmental consultancy services in respect of sea pollution; (vii) information products development; and (viii) providing other port-related services.

— 37 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

3. Background of other connected persons involved in the Continuing Connected Transactions

Xiamen Port Construction

Xiamen Port Construction is a wholly-owned subsidiary of Xiamen Port Holding and its principal business includes integrated land development, management of development and construction of port, road and ancillary works, construction management technical consultation, as well as provision of property management, logistics and security services.

Xiamen Port D&C

Xiamen Port D&C is a wholly-owned subsidiary of Xiamen Port Holding and is principally engaged in the port infrastructure construction and management business.

Xiamen Port Services

Xiamen Port Labour is a wholly-owned subsidiary of Xiamen Port Holding and is principally engaged in providing labour services.

4. Overview of the PRC port industry

According to 中國港口協會 (the China Ports Association), the total cargo and container throughputs handled by ports in the PRC reached approximately 7.63 billion tonnes and 140 million TEUs for the eight months ended 31 August 2015, representing increases of approximately 2.8% and 5.3% on a period-on- period basis, respectively.

According to 廈門港口管理局 (the Xiamen Port Authority), the total cargo and container throughputs handled by ports in Xiamen reached approximately 140.5 million tonnes and 6.0 million TEUs for the eight months ended 31 August 2015, representing increases of approximately 5.8% and 8.6% on a period-on- period basis, respectively.

According to 中華人民共和國商務部 (the Ministry of Commerce of the PRC), the import and export trade of the PRC decreased by approximately 8.8% for the nine months ended 30 September 2015 on a period-on-period basis.

For recent development closely affecting the Group itself, following the on-going in-depth implementation of the Overall Trial Proposal of Integrated Ancillary Reform of Deepening the Cross-strait Exchange and Cooperation in Xiamen City (廈門市深化兩岸交流合作綜合配套改革試驗總體方案), Fujian Province, the PRC and the continuous promotion of the construction of the South-East International Shipping Centre and Mainland-Taiwan Trade Centre (大陸對台貿易中心) in Xiamen, it is expected that the business development of Xiamen in trade and logistics will further develop across the Taiwan Straits, which in turn will benefit the continuous development of Xiamen port and the business of the Group.

5. Background and reasons for the Continuing Connected Transactions

Reference is made to the announcement of the Company dated 23 October 2013 in relation to the renewal and disclosure of certain continuing connected transactions between the Group and Xiamen Port Holding and/or its associates and other connected persons of the Company, which are governed by, among others, the following agreements:

— 38 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

1. the 2013 Master Property Services Agreement;

2. the 2013 Comprehensive Services Agreement;

3. the 2013 Master Project Management Agreement;

4. the 2013 Master Engineering Agreement; and

5. the 2013 Master Labour Services Agreement.

The continuing connected transactions contemplated under, among others, the 2013 General Services Agreements, and the Annual Caps applicable thereto were approved by the then Independent Shareholders at the 2013 EGM.

The 2013 General Services Agreements, governing the above continuing connected transactions will expire on 31 December 2015.

On 20 October 2015, the Board announced that the Group has entered into, among others, the 2015 General Services Agreements to further renew the 2013 General Services Agreements in accordance with their respective provisions for a further term of three years expiring on 31 December 2018.

6. Principal terms of the Continuing Connected Transactions

A. Property management services

Pursuant to the 2015 Master Property Services Agreement, Xiamen Port Construction has agreed to provide property management and/or security and logistical services to the Group, including (i) property management and security services for the office premises and terminal area; (ii) hygiene and cleaning services; (iii) food and beverage for staff; and (iv) environmental and landscaping services, for supporting the Group’s operation of container terminals and for management of office premises.

Pricing policy and other material terms

Pursuant to the 2015 Master Property Services Agreement, charges for the relevant services shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Construction according to the following pricing principles:

(i) by reference to the relevant pricing guideline issued by Xiamen DRC, XCB and XPB from time to time (including, without limitation, (i) the Notice relating to the Announcement of the Classification Standards and Guidance Fees of Residential Premises in Xiamen Municipal* 《關於公佈廈門市住宅物業服務等級標準及( 收費指導價》) issued by XCB and XPB in October 2008 which sets out the general guidance pricing principles as to the provision of general property management services relating to, inter alia, industrial factory building and office premises in Xiamen that the relevant service charges should be freely negotiated between the service provider and the service recipient so as to encourage positive price competition); and (ii) the various notices issued by Xiamen DRC and XCB which contains prescribed rates for the provision of certain specific types of property management services in Xiamen, such as RMB40 to RMB60 per month for car park

— 39 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

space management service depending on the class of services and RMB4 per square metre for first time construction waste disposal service and RMB6 per square metre for any additional service thereafter; and

(ii) taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Construction and its subsidiaries (the historical range of which is approximately 3% to 5% as to residential premises, and approximately 6% to 10% as to office premises) by reference to historical rate.

The Board currently expects that most of the relevant charges will be negotiated and determined by the parties in good faith in accordance with the pricing principle set out in sub- paragraph (ii) above.

Charges incurred will be settled on a monthly basis through bank transfer.

Pursuant to the 2015 Master Property Services Agreement, the Group has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Construction.

We have been further advised by the Directors that the property management services are labour intensive in nature and the charges for such services are substantially labour-related costs which are primarily determined with reference to (i) the Notice of Wages Guideline for Certain Types of Works (Positions) in Xiamen Municipal in 2014* 《( 2014年廈門市部分工種 (職位) 工資指導價位的通知》) (the “Xiamen HRSS Notice”) issued by Xiamen HRSS, a government authority responsible for, inter alia, implementing the State’s guidelines, policies, laws and regulations on labour and social security and providing guidelines that set out the wage levels for the enterprises in Xiamen); and (ii) the labour-related social welfare contributions required to be made in accordance with the relevant rules and regulations of the PRC (the “Required Labour Contributions”).

Based on our discussion with the Directors, we understand that the labour-related costs represent a substantial portion of the total estimated property management service charges for the three years ending 31 December 2018, and are comparable with the relevant wage rates as stipulated in the Xiamen HRSS Notice after taking account of the Required Labour Contributions. The nature of the property management industry determines that the services provided under the 2015 Master Property Services Agreement possess great diversity whilst the major roles comprise of security guards, out-door cleaners, in-door cleaners, gardeners etc. We have conducted review on the charges to be imposed pursuant to the 2015 Master Property Services Agreement and noted that the rates charged by Xiamen Port Construction are generally in line with the wage level as stipulated in the Xiamen HRSS Notice and the standard Required Labour Contributions. Meanwhile, as the Xiamen HRSS sets the industrial standard and minimum charge level of wages for comparable property management services, together with Group’s stringent internal control procedures as disclosed in the paragraph 7 below, whilst other property management service providers in the market are basically discouraged to adopt their charge rates for wage level materially deviated from that set out in the Xiamen HRSS Notice, we therefore are of the view that the actual charging rate proposed by Xiamen Port Construction shall be no less favourable than that provided by third party service providers.

— 40 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

As suggested by the Directors, the historical range of profit margins charged by Xiamen Port Construction is approximately 3% to 5% for the residential property management services; and 6% to 10% for the office property management services. This is generally comparable to, or lower than, the findings of our independent research from a research report produced by Everbright Securities Company Limited dated 26 June 2014 indicating that the average financial net profit margin of the top 100 PRC property management companies lies on the level of around 8%, which have taken into account the market situations of both residential and commercial properties. Typical range of contributions of property management service income include the security services, hygiene and cleaning services, landscaping services etc. As the nature of the property management business employed by the residential/commercial real estate industries and the Group are greatly alike, the above-mentioned average net profit margin is fair and representative to serve as an appropriate and meaningful benchmark for the pricing basis of the 2015 Master Property Services Agreement. Further, given the relatively smaller scale of the of Xiamen Port Construction comparing to the top 100 PRC property management companies, it shall be reasonable for that a lower profit margin of Xiamen Port Construction attributes to its relatively smaller scale of business, less sophisticated resource allocation and industry experience. Overall, we consider that the profit margin charged by the Xiamen Port Construction is fair and reasonable, and basically in line with the industry norm.

Given that the charges under the 2015 Master Property Services Agreement shall be determined with reference to the relevant pricing guideline issued by relevant governmental authorities such as Xiamen DRC, XCB and XPB from time to time and the reasonable cost plus reasonable profit margin of Xiamen Port Construction and its subsidiaries by reference to historical rate while taking into account of the comparable local average market price and market condition in Xiamen, we are of the view that the transactions contemplated under the 2015 Master Property Services Agreement are conducted in the ordinary and usual course of business of the Group, are on normal commercial terms, and the terms of such transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Further, we have noted from the 2015 Master Property Services Agreement that the Group has the right to choose a third party to provide the relevant services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Construction. We are of the view that such provision provides further flexibility to the Group for better securing its benefits from the arrangement and are in the interests of the Company and the Shareholders as a whole.

Annual Caps

The proposed Annual Caps for the transactions contemplated under the 2015 Master Property Services Agreement are RMB24.0 million, RMB26.0 million and RMB27.0 million for each of the three years ending 31 December 2016 to 2018, respectively.

The Directors expect that there will be a substantial increase in the fees payable by the Group in the year of 2016 and moderate growths over the following two years over 2017 to 2018 in terms of the services to be rendered under the 2015 Master Property Services Agreement after taken the following specific factors into account:

• historical transaction amounts, in particular the contribution of the provision of property management and security services for the office premises and terminal area at approximately 48% to the estimated aggregate transaction amounts during the term of the 2013 Master Property Services Agreement;

— 41 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• prevailing market rates in Xiamen gathered by the Group prior to the signing of the 2015 Master Property Services Agreement;

• estimated organic annual growth in the international and domestic trade handling throughput of the Group during the relevant period by approximately 7% to 12% per year;

• estimated consequential annual growth in the demand for ancillary services at the terminals operated by the Group during the relevant period driven by the aforesaid estimated organic growth in the Group’s international and domestic trade handling throughput;

• the estimated contribution of the provision of property management and security services for the office premises and terminal area at approximately 48% to the estimated aggregate transaction amounts during the term of the 2015 Master Property Services Agreement;

• estimated annual increase in the service fees payable by the Group due to price and labour cost inflation by approximately 5% to 10% per year; and

• reasonable upward margin ranging from 17.5% to 20.2% reserved for each year during the term for contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

We understand that the historical transaction amounts amounted to approximately RMB11.1 million and RMB10.6 million for the two years ended 31 December 2013 and 2014, respectively. Based on our discussion with the Management, the historical transaction amounts for the two years ended 31 December 2013 and 2014 were considered to be relatively stable, while the actual transaction amounts are expected to be considerably increased in 2015 and during the term of the 2015 Master Property Services Agreement, mainly attributable to the four newly acquired terminals following the JV Formation. According to the Directors’ latest estimates, the estimated transaction amount for the full year ending 31 December 2015 would attain at approximately RMB16.4 million, representing a significant increase of approximately 54.7% when compared to that of RMB10.6 million for the year ended 31 December 2014.

During the course of our assessment for the Group’s setting of the Annual Caps, we obtained the understanding from the Management that, after the completion of the JV Formation in 2014, the Group had occupied much wider port areas along the coastal line of the Xiamen Port. In particular, the Group has been undertaking certain construction/variation/rectification works for the newly-acquired port areas of approximately 3,433,200 square metres for the purpose of increasing the operating areas within the Xiamen Port (i.e. in the areas that were previously unused/idle for non-operating purpose), and ultimately enhancing the operating efficiency/capability of such port areas since then. The Group expects that the operating efficiency/capability of such additional port areas will be gradually improved over the coming years provided such construction/variation/rectification works can be completed by that time. It is currently anticipated that, during the progress of such works and following their gradual completion thereafter, the Group’s demand for property management services would be greatly increased during the coming three years to cope with the newly completed operating port areas and the new building structures erected thereon. The proposed Annual Cap for the year ending

— 42 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

31 December 2016 is primarily determined on such basis. However, as the Annual Cap for the year ending 31 December 2015 is expected to be under-utilized, whilst the same situation incurred for the year ended 31 December 2014, the proposed Annual Cap for the year ending 31 December 2016 is now set at RMB24.0 million, which is 58% lower than that of 2015, but still represents an approximately 46.3% increase over the expected actual costs incurred for the year ending 31 December 2015.

Meanwhile, we have reviewed the Group’s business plan and operating data/information covering its various ports currently occupied for the coming three years ending 31 December 2016 to 2018. The Annual Caps for the above-mentioned three years are RMB24.0 million, RMB26.0 million and RMB27.0 million respectively, which represent a CAGR of approximately 6.1%. In the meantime, the statistics released by the Xiamen Local Taxation Bureau* (廈門市地方稅務局, “Xiamen LTB”) show that the average annual wage paid in Xiamen (the “Average Wage”) during the period from 2005 to 2014 represents a compound annual growth rate (“CAGR”) of approximately 10.4%, which is above the CAGR of approximately 6.1% for the Annual Caps over the period of 2016 to 2018 and it is justifiable for the Group to provide a reasonable buffer for accommodating the expected increase in Average Wage level and/or business volume over the same period. As such, we consider that the rationale behind for the Annual Caps’ setting is appropriate and justifiable, despite the historical actual transaction amounts were considerably lower than those for the coming three years. Furthermore, we have reviewed the Group’s historical operating scale in terms of revenue, which had been steadily increasing year by year from approximately RMB2,065.9 million in 2009 to RMB6,092.0 million in 2014, representing a CAGR of approximately 24.1% per annum. Based on our assessment of the Group’s operating budget for the coming three years ending 31 December 2016 to 2018, we consider that the Annual Caps’ setting for the same period is appropriate and justifiable after taking into account the above principal factors and assumptions.

In assessing the fairness and reasonableness of the proposed Annual Caps, we have conducted independent review of the Group’s business planning, the historical actual transaction amounts and annual caps’ setting over the past years, we understand that the Group has projected the proposed Annual Cap amounts by taking into account (i) the expected continuous substantial increase in the Group’s demand for property management services mainly attributable to the construction/variation/rectification works for the newly-acquired but previously unused/idle port areas of the four newly acquired terminals following the JV Formation with reference to an anticipated substantial growth of approximately 54.7% in 2015; (ii) a reasonable price increase level by 5% to 10% which is comparable to the Average Wage; and (iii) a moderate buffer for reasonable upward margin reserved for each year for contingency reasons. Accordingly, we are of the view that the basis for determination of the proposed Annual Caps is justifiable.

Since (i) the proposed Annual Cap for the year ending 31 December 2016 is calculated based on a CAGR regarding the Average Wage of approximately 10.4%; (ii) the expected continuous substantial increase in the Group’s demand for property management services in 2016, mainly attributable to the construction/variation/rectification works for the newly- acquired but previously unused/idle port areas of the four newly acquired terminals upon the JV Formation with reference to the anticipated substantial growth of approximately 54.7% in 2015; and (iii) the CAGR of approximately 6.1% in the proposed Annual Cap for the period of 2016 to 2018 is below the CAGR regarding the Average Wage of approximately 10.4%, we consider that the proposed Annual Caps for the transactions contemplated under the 2015 Master Property Services Agreement are justifiable, fair and reasonable.

— 43 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

B. Comprehensive services

Pursuant to the 2015 Comprehensive Services Agreement, Xiamen Port Holding has agreed to provide certain comprehensive services to Xiamen Port Development Group for the operation of the general cargo terminal and other port businesses owned by Xiamen Port Development Group. The specific type of services to be provided under the 2015 Comprehensive Services Agreement include (i) staff quarters and ancillary facilities to certain employees of Xiamen Port Development Group; (ii) canteen and ancillary services to the employees of Xiamen Port Development Group; (iii) environmental, hygiene and landscaping services for the office, port areas and terminal areas of Xiamen Port Development Group; and (iv) labour services for container/cargo loading and unloading at the berths operated by Xiamen Port Development Group.

The relevant services have been provided to Xiamen Port Development Group from mid-2003. The Directors believe that such on-going comprehensive services are practical and efficient from the perspective of the Group’s operations and such transactions are beneficial to the Group as a whole since Xiamen Port Holding Group possesses the required facilities, staff and experience to deliver the services. Based on previous transactions with the Group, relevant members of Xiamen Port Holding Group are experienced and accustomed to the operations of port business of the Group and hence have a sound understanding of the standards and quality required for the relevant services. Retaining Xiamen Port Holding Group to provide the relevant services would also ensure operational continuity and minimize any disruptions to the operations and business of the Group.

Pricing policy and other material terms

Pursuant to the 2015 Comprehensive Services Agreement, charges for the relevant services shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Holding Group according to the following pricing principles:

(i) by reference to (a) the relevant pricing guideline relating to minimum wage standard for the labour market issued by Xiamen HRSS from time to time (i.e. the Xiamen HRSS Notice); and (b) the Required Labour Contributions in Xiamen; and

(ii) taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding Group by reference to historical rate;

Description of the specific type of services to be provided by Xiamen Port Holding Group and their particular pricing terms are as follows:

(i) the rates to be charged for the staff quarters and ancillary facilities shall be the same as or not higher than those charged by Xiamen Port Holding to its own employees and the employees of Xiamen Port Development Group will directly pay for the charges. In this regard, (a) the charge for the provision of such facilities will amount to approximately RMB500 to RMB800 per month depending on the floor area of the staff quarters; and (b) the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (i.e. staff quarters service staff) as stated in the Xiamen HRSS Notice is approximately RMB2,023 to RMB3,668 per month per person;

— 44 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(ii) the fees for the canteen and ancillary services provided to the employees of Xiamen Port Development Group shall be the same as those fee standards charged by Xiamen Port Holding to its own employees and the employees of Xiamen Port Development Group will directly pay for the charges. In this regard, (a) the average rate for the provision of such services will amount to approximately RMB12 to RMB20 per head per visit; and (b) the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (i.e. food and beverage service staff) as stated in the Xiamen HRSS Notice is approximately RMB1,936 to RMB4,325 per month per person;

(iii) the fees for the environmental, hygiene and landscaping services for the office, port areas and terminal areas of Xiamen Port Development Group are determined based on the prescribed monthly wage range applicable to the relevant service employees of Xiamen Port Holding Group (which include environmental hygiene staff, cleaners and gardeners) ranging from RMB1,866 to RMB4,037 per month per person as set out in the Xiamen HRSS Notice and in accordance with the abovementioned pricing principles. After taking the estimated Required Labour Contributions into account (i.e. approximately RMB760 per month), it is currently expected that the average wage of the relevant service employees will amount to approximately RMB3,325 per month per person; and

(iv) the relevant actual labour costs calculated based on the prescribed wage applicable to the relevant service employees of Xiamen Port Holding Group (i.e. longshoremen) ranging from RMB3,506 to RMB8,581 per month per person as set out in the Xiamen HRSS Notice and the internal charging standard of Xiamen Port Holding, plus a 5% management fee in respect of the labour services for the labour services for container/ cargo loading and unloading at the berths operated by Xiamen Port Development Group. After taking the estimated Required Labour Contributions into account (i.e. approximately RMB859 per month), it is currently expected that the average wage of the relevant service employees will amount to approximately RMB5,824 per month per person.

Unless otherwise agreed by the parties, charges incurred by Xiamen Port Development Group will be settled on a monthly basis.

Pursuant to the 2015 Comprehensive Services Agreement, Xiamen Port Development Group has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding.

We have been advised by the Directors that the majority of the comprehensive services relate to labour intensive services for domestic container and cargo loading and unloading at the berths operated by Xiamen Port Development Group and the charges for such services are substantially labour-related costs which comprise (i) wages primarily determined with reference to the Xiamen HRSS Notice; and (ii) the Required Labour Contributions.

Based on our discussion with the Directors, we understand that the labour-related costs represent a substantial portion of the total estimated comprehensive services charges for the three years ending 31 December 2018, and are comparable with the relevant wage rates as stipulated in the Xiamen HRSS Notice after taking account of the Required Labour Contributions. In particular, environmental, hygiene and landscaping services are charging at

— 45 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

the rate of around RMB3,325 per month per person on average whilst the labour services for container/cargo loading and unloading are charged at rate of around RMB4,688 per month per person on average, both of which are in line with the relevant wage rates as stipulated in Xiamen HRSS Notice and the Required Labour Contributions. As confirmed by the Management, the Group has made reference to the wage level as stipulated in the Xiamen HRSS Notice on setting comprehensive service charges pursuant to the 2015 Comprehensive Services Agreement.

Further, we have noted from the 2015 Comprehensive Services Agreement that the charges thereunder shall be determined with reference to the similar service charge rates charged by Xiamen Port Holding to its own employees, the estimated costs to be incurred in connection with provision of such services by Xiamen Port Holding, the prevailing market price and the actual labour costs incurred plus a nominal 5% management fee, as the case may be. Given such pricing policy and that a substantial portion of the charges under the 2015 Comprehensive Services Agreement relate to labour intensive services for domestic container and cargo loading and unloading at the berths operated by the Xiamen Port Development Group and the labour- related costs are comparable with the relevant wage rates as stipulated in the Xiamen HRSS Notice after taking into account of the Required Labour Contributions, we are of the view that the transactions contemplated under the 2015 Comprehensive Services Agreement are conducted in the ordinary and usual course of business of the Group, are on normal commercial terms, and the terms of such transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

It is stated in the 2015 Comprehensive Services Agreement that Xiamen Port Development Group has the right to choose a third party to provide the relevant services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding. We are of the view that such provision provides further flexibility to Xiamen Port Development Group for better securing its benefits from the arrangement and are in the interests of the Company and the Shareholders as a whole.

Annual Caps

The proposed Annual Caps for the transactions contemplated under the 2015 Comprehensive Services Agreement are RMB34.5 million, RMB37.5 million and RMB40.8 million for each of the three years ending 31 December 2016 to 2018 respectively.

The Directors expect that there will be a steady increase in the fees payable by the Group in each year over the preceding year during the period from 2016 to 2018 in terms of the services to be rendered under the 2015 Comprehensive Services Agreement after taken the following specific factors into account:

• historical transaction amounts, in particular the contribution of the provision of (a) labour services for container/cargo loading and unloading services and (b) the other comprehensive services at approximately 90% and 10% to the estimated aggregate transaction amounts during the term of the 2013 Master Property Services Agreement respectively;

• prevailing market rates in Xiamen gathered by the Group prior to the signing of the 2015 Comprehensive Services Agreement;

— 46 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• estimated organic annual growth in the operation volume at the general cargo terminals operated by the Xiamen Port Development Group during the relevant period by approximately 8% to 16% per year, being 16% for the year 2016, 8% for the year 2017 and 8% for the year 2018;

• estimated consequential annual growth in the demand for port ancillary services operated by the Xiamen Port Development Group during the relevant period;

• the estimated contribution of the provision of (a) labour services for container/ cargo loading and unloading services and (b) the other comprehensive services at approximately 92% and 8% to the estimated aggregate transaction amounts during the term of the 2015 Master Property Services Agreement; and

• reasonable upward margin reserved for each year for contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

We understand that the historical/expected transaction amounts are approximately RMB25.7 million and RMB26.5 million for each of the two years ended 31 December 2014 and 2015, respectively. According to the statistics released by Xiamen LTB, the Average Wage during the period from 2005 to 2014 represents a CAGR of approximately 10.4%. We have also noted from the interim report of the Company for the six months ended 30 June 2015 (the “2015 Interim Report”) that the throughputs of the container port business of the Group for the six months ended 30 June 2015 increased by approximately 9.6% on a period-on-period basis. Based on our discussion with the Management, the historical transaction amounts for the three years ended 31 December 2015 were considered to be relatively stable. The second half of the year 2015 is expected to see basically comparable, or even higher, growth when compared to the first half of the year 2015, keeping the full year growth for the 12 months ending 31 December 2015 mainly achievable. Based on our review of the interim reports and annual reports of the Company for the past four financial years from 2011 to 2014, we noted that the Group’s historical operating data and performance in terms of container throughputs and revenue had been showing that its operating performance of the second half of a financial year had been higher (with an average of around 55.4% and 57.8%) than that of the first half of the same year with an average of approximately 44.6% and 42.2%, respectively. Meanwhile, the Management suggested that the majority of the construction of berths no. 20 to no. 21 of Haicang port area is to be completed in the second half of 2016 and the port is to commence its preliminary operation once completed. As such, this construction project would contribute to the expected increasing operation volume, especially in the type of food supplies and steels, at the general cargo terminals which is expected to see a rise up to 16% for the 12 months ending 31 December 2016. Thereafter, the transaction amounts are expected to gradually increase in the coming few years. In addition, the CAGR of approximately 8.7% in the proposed Annual Cap for each of the two years ending 31 December 2017 and 2018 is for providing a reasonable buffer for (i) the anticipated increase in Average Wage; (ii) stable increase in the throughput handled by Xiamen Port Development Group; and (iii) the demand for loading and unloading services at the relevant terminals. Furthermore, we have reviewed the Group’s historical operating performance in terms of revenue, which had been steadily increasing year by year from approximately RMB2,065.9 million in 2009 to RMB6,092.0 million in 2014, representing a CAGR of approximately 24.1% per annum. This historical trend is able to provide a good reference for tendency of the Group’s overall persistent and concrete organic growth of business scale and operating performance, which the Management and we believe it can prolong in the coming years notwithstanding the global economic downturn in the recent years.

— 47 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Since (i) the proposed Annual Cap for the year ending 31 December 2016 is calculated based on a historical transaction amount, the CAGR regarding the Average Wage of approximately 10.4% and the expected growth of the Xiamen Port Development Group’s throughput at the relevant terminals in 2016; and (ii) the CAGR of approximately 8.7% in the proposed Annual Cap for each of the two years ending 31 December 2017 and 2018 is pretty comparable with the CAGR regarding the Average Wage of approximately 10.4% and is within the range of the period-on-period growths of approximately 9.6% in the throughputs of the container port business, we consider that the proposed Annual Caps for the transactions contemplated under the 2015 Comprehensive Services Agreement are justifiable, fair and reasonable.

C. Construction project management

On 23 October 2013, Xiamen Port D&C and the Group entered into the 2013 Master Project Management Agreement, pursuant to which Xiamen Port D&C shall provide the Group with project management services on projects involving the construction of berths or other port-related facilities and infrastructure, which include project bidding, land requisition and housing demolition and relocation and project construction management. The 2013 Master Project Management Agreement has a term of two years which will expire on 31 December 2015. From 1 January 2016, these project management services will be provided by Xiamen Port Construction in substitution of Xiamen Port D&C.

On 20 October 2015, Xiamen Port Construction and the Group have entered into a new project management contract, namely 2015 Master Project Management Agreement, in order to secure the service for a further term of three years from 1 January 2016 to 31 December 2018.

Pursuant to the 2015 Master Project Management Agreement, Xiamen Port Construction will provide the Group with project management services on projects involving the construction of berths or other port-related facilities and infrastructure, which include project bidding, land requisition and housing demolition and relocation and project construction management.

The Directors believe that it is in the Company’s best interests to enter into the 2015 Master Project Management Agreement having considered the following factors:

— 48 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• the staff of Xiamen Port Construction possesses extensive port construction experience and are experienced in managing the Group’s construction projects.

Pricing policy and other material terms

(i) if applicable, by reference to the relevant pricing guideline issued by the relevant construction project management authorities at the national, Fujian provincial and Xiamen municipal levels from time to time (i.e., the Notice of Adjustment of the Calculating Standards for Construction Management Charges under Fiscal Investment and Financing Project* 《關於調整我市財政性投融資項目建設單位管理費計取( 標準的通知》) issued by XFB in 2011 which sets out, inter alia, the calculation and allocation basis and standards as to construction project management fees relating to construction projects in Xiamen Municipality (the “XFB Notice”)); and

As at the date of this letter and as far as the Board is aware, the only relevant pricing guideline in place applicable to the determination of the charges under the 2015 Master Project Management Agreement is the XFB Notice.

In particular, the construction management fees are determined with reference to the abovementioned pricing principles, with such appropriate adjustments agreed by the parties due to the estimated workload, building materials and equipment required, as well as complexity and technical uniqueness in port-related construction projects:

(i) construction safety management fee: up to 2% of the construction budget if the budget is equal to or exceeds RMB1,000,000,000, and up to 2.5% if the construction budget is below RMB1,000,000,000; in case of building construction, 3% of the project settlement price;

(ii) pre-construction management fee: 2.5% of the actual amount incurred at the pre- construction stage;

(iii) bidding and cost consultation management fee: for bidding management fee, 0.18% of the bidding control price; for cost consultation management fee, 0.4% of the control price;

(iv) other management fee: 1% of the actual compensation paid for land expropriation;

(v) bonus fee: 20%, payable by the Group to Xiamen Port Construction, of the difference between the budgeted and the final costs, if the final cost falls below the amount the Group has budgeted; and

— 49 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(vi) a penalty charge, payable by Xiamen Port Construction to the Group, which is equal to the difference between the final cost and the budgeted amount up to a maximum amount of 40% of the management fee to which Xiamen Port Construction is entitled, if the final cost is higher than the amount the Group has budgeted, provided that the difference is not caused by (a) a change of law or government policies; (b) factors attributed to the Company; (c) force majeure events; or (d) material change of circumstances.

We have been advised by the Directors that the construction safety management fee is determined broadly in line with the spirit of the fee structure consisting regressively decreasing fixed percentage rates as to tower block construction projects set out in the XFB Notice (i.e. (i) 3% if the construction budget is below RMB30,000,000; (ii) 2.5% if the construction budget is between RMB30,000,000 and RMB50,000,000; and (iii) 2% if the construction budget is above RMB50,000,000), whilst the pricing terms of the remaining types of management fees are determined by taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Construction by reference to historical rate as the XFB Notice has no relevant and applicable rates in this regard. Meanwhile, bonus/penalty mechanism referred to in (v) and (vi) above is intended to be an incentive to enhance the efficiency and cost control of Xiamen Port Construction in managing the construction projects.

The brief procedures for determining the budgeted amount of each on-going or planned port-related project as contemplated under the 2015 Master Project Management Agreement are as follows:

(i) drafting of preliminary construction plan based on (a) the feasibility report prepared by professional architectural design institutes after on-site inspection; and (b) estimated workload, building materials and equipment required, as well as the complexity and technical uniqueness of the project;

(ii) preparation of initial budgetary estimates based on such preliminary construction plan and in strict accordance with the allocation basis as stipulated in the XFB Notice that project management fees shall be allocated as follows: (a) 20% to the project owner and 80% to the project manager; and (b) 100% to the project manager if all works are conducted by the project manager solely;

(iii) confirmation of final construction plan after audit of the initial budgetary estimates by the relevant governmental authority (which is usually the Xiamen DRC);

(iv) preparation of final budget based on the confirmed final construction plan; and

(v) confirmation of the final budget after independent audit.

Pursuant to the 2015 Master Project Management Agreement, the Group has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Construction.

We have compared the terms under the 2015 Master Project Management Agreement with another project management agreement entered into between Xiamen Port Construction and an independent third party in relation to port construction management work in a similar area

— 50 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

in Xiamen, and are satisfied that the pricing and payment terms of the 2015 Master Project Management Agreement are basically comparable with that project management agreement in all material respects and are no less favourable than those offered by Xiamen Port Construction to such independent third party.

Further, we have noted from the 2015 Master Project Management Agreement that the charges thereunder shall be determined with reference to the pricing policy prescribed by the Xiamen Municipal Finance Bureau. Also, as suggested by the Management, the Xiamen Port Construction or its associates has not undertaken any construction projects in similar nature apart from the ones conducted with the Group. We therefore have conducted review of three pretty old but most recent construction management agreements between either Xiamen Port Construction or its associates and two independent third party clients, namely Intex Dock (Xiamen) Company Limited (明達碼頭（廈門）有限公司) (the “Intex Dock”) and Intex Glass (Xiamen) Company Limited (明達玻璃（廈門）有限公司) (the “Intex Glass”), and Xiamen Port Holding Group respectively. In particular, the contract between Xiamen Port Development and Construction Company Limited (廈門港口開發建設有限公司), a subsidiary of Xiamen Port Construction and Intex Dock, an independent third party, relates to the construction of the port of Intex Group (宇德集團). The components of the project comprise of construction design, project tendering (including construction and supervision), implementation and completion inspection. The contract date was dated 21 December 2006 and the contract lasts for few years until the project completion. The charging rate of the contract was 2.5% of the construction budget whilst the payments were made by instalments in phases. After comparing the other two contracts, we consider the relevant nature of construction management services, charging rates and payment terms of the three agreements, are generally comparable to and no more favourable than those imposed under the 2015 Master Project Management Agreement. Given such pricing policy and that the pricing and payment terms of the 2015 Master Project Management Agreement are basically comparable with the relevant government policy and are no less favourable than those offered by Xiamen Port Construction to other parties (including independent third parties) based on our review, we are of the view that the transactions contemplated under the 2015 Master Project Management Agreement are conducted in the ordinary and usual course of business of the Group, are on normal commercial terms, and the terms of such transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

It is stated in the 2015 Master Project Management Agreement that (i) the Group has the right to choose a third party to provide the relevant services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Construction; and (ii) the Group is entitled to terminate the agreement unilaterally whilst Xiamen Port Construction does not entitled to the same right thereunder. We are of the view that such provisions provide further flexibility to the Group for better securing its benefits from the arrangement and are in the interests of the Company and the Shareholders as a whole.

Annual Caps

The proposed Annual Caps for the transactions contemplated under the 2015 Master Project Management Agreement are RMB28.5 million for each of the three years ending 31 December 2016 to 2018, which have been determined with reference to the following considerations:

• historical transaction amounts;

— 51 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

• estimated aggregate annual capital expenditure budgeted for the Group’s on-going and planned projects during the relevant period includes, but without limitation to, (i) construction projects of berths no.20 to no.21 of Haicang port area; (ii) dredging and related works at the turning basins of Xiamen Songyu Terminal and other terminals in Haicang port area; (iii) engineering projects relating to the expansion of the freight terminal at Chaozhou port; (iv) major construction projects relating to Ji’an land- based port in Jiangxi Province and Sanming land-based port in Fujian Province; (v) works relating to the construction of the inter-connection highway at Zhangzhou Gulei and the related berths at Zhangzhou Longchi; and (vi) maintenance works of the Group’s certain berth-related highways, storage yards and construction facilities;

• estimated workload, building materials and equipment required, as well as complexity and technical uniqueness of each of the abovementioned projects; and

• reasonable upward margin reserved for each year for possible project construction cost inflation and other contingency reasons, the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

The details of the Group’s on-going and planned projects during the relevant period mentioned above are as follows:

Commencement and Project Nature completion date Budgeted amount

Construction projects of Construction of two bulk/ Commenced in RMB1,437,000,000 berths no.20 to general cargo berths of December 2012 and no.21 of Haicang 50,000 tonnes and expect to complete port area 70,000 tonnes construction and respectively handover in December 2016

Dredging and related Dredging works including Works at Xiamen Songyu RMB121,000,000 works at the turning earthworks and Terminal: commenced basins of Xiamen reef blasting at the in June 2014 and expect Songyu Terminal turning basins and to complete construction and other terminals port basins of berths and handover in at Haicang port area no.1 to no.3 of Xiamen January 2016 Songyu Terminal and other terminals at Works at other terminals: Haicang port area to be commenced in (such as Xinhaida due course during the Terminal) term of the 2015 Master Engineering Agreement

Engineering projects Construction of a Commenced in June 2014 RMB490,000,000 relating to the 5,000-tonnes general and expect to complete expansion of the cargo berth and construction and freight terminal at a 5,000 tonnes handover in June 2016 Chaozhou port multi-purpose berth

— 52 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Commencement and Project Nature completion date Budgeted amount

Major construction (i) Construction of six (i) To be commenced RMB180,000,000 projects relating to warehouses with in May 2016 and Ji’an land-based port a total plot area expect to hand over in in Jiangxi Province of approximately December 2016 and and Sanming 40,000 square metre complete in June 2017 land-based port in and a road yard of Fujian Province approximately 40,000 square metre as part of Ji’an land-based port’s phase two construction project

(ii) Construction of (ii) To be commenced four electronic in May 2016 and commerce warehouses expect to hand over of approximately in December 2016 4,798.25 square and complete in metre each and June 2017 office buildings and other areas of approximately 62,553 square metre for the electronic commerce distribution centre in the logistics park at Sanming land-based port

(iii) Construction of (iii) Commenced in two warehouses November 2014, with a total area handed over in May of approximately 2015 and expect 10,000 square metre to complete in and road yards February 2016 of approximately 36,000 square metre in the storage public area at Sanming land-based port

— 53 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Commencement and Project Nature completion date Budgeted amount

Works relating to the (i) Construction of (i) Commenced in RMB867,000,000 construction of the road access to the January 2013, handed inter-connection Zhangzhou Gulei over in December highway at port area with a total 2015 and expect to Zhangzhou Gulei and length of 5.15 km complete in December the related berths at 2016 Zhangzhou Lonchi (ii) Land reclamation and (ii) Pre-construction construction of two works to be bulk/general berths at commenced in June Zhangzhou Longchi 2016 and expect to hand over in December 2020 and complete in December 2021

Maintenance works “From oil to electricity” Commenced in July 2015 RMB70,000,000 of the Group’s certain transformation works and expected to complete berth-related relating to the yards in March 2016 highways, storage and equipment at yards and construction Haitian terminal and facilities Xiangyu terminal

As suggested by the Management, arm’s length negotiations had been conducted between the relevant members of the Group and Xiamen Port Holding Group in order to reach the above budgeted amount of each of the above projects. The negotiations had been conducted in good faith by (i) reliance on the knowledge base of past projects of similar size, nature, scope and location; (ii) taking into account of the estimated capital cost based on the workload, building materials and equipment required, as well as the complexity and technical uniqueness of each project and by reference to the abovementioned pricing guideline issued by the various governmental authorities; and (iii) inclusion of a contingency amount as an insurance policy to cover unforeseen conditions or requirements.

With reference of the above consideration, we consider that the rationale for setting the Annual Caps under the 2015 Master Project Management Agreement is appropriate and justifiable.

As advised by the Directors, since the Company may not have full control over the development process of the various construction projects, and that the capital expenditure during the development phases of construction projects may not be evenly spread out from one year to the next, the Directors have considered the possibility that a large amount of capital expenditure may incur within one single year. In addition, as a prudent measure, the Directors have assumed that the Company will pay the management fee at the rate of 2.5%, close to the maximum level of 3%, in calculating the proposed Annual Caps, which is applicable to the transactions contemplated under the 2015 Master Project Management Agreement. Implementation of all such planned construction projects will depend on the Group’s available financial resources and the overall economic environment in the Mainland China and her key importing/exporting countries.

— 54 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The proposed Annual Caps at RMB28.5 million will remain the same for the three years ending 31 December 2018. We have noted that the annual caps for the past two years ended 31 December 2014 were not fully utilised which, as advised by the Directors, was mainly due to the postponement of certain previously planned construction projects as a result of the sluggish economic activities in the global environment and import and export trades between the Mainland China and those western countries.

In assessing the fairness and reasonableness of the proposed Annual Caps, we have conducted independent review for setting the relevant proposed Annual Caps under the abovementioned estimated aggregate capital expenditure budget with budgeted amount for each planned construction and the Group’s overall business planning. Based on our discussion with the Management, we have noted that the construction budget is prepared with reference to the Group’s expansion plan and the current status of the Group’s existing construction projects (including those that were previously either cancelled or postponed due to the global financial crisis and need to be caught up). As confirmed by the Directors, the Group’s two key construction projects, namely Ji’an land-based port in Jiangxi Province and Sanming land- based port in Fujian Province, are either in the process of applying for or have been granted the relevant government approvals for conducting the relevant construction works. Another two key construction projects, namely berths no. 20 to no. 21 of Haicang port area and engineering projects relating to the expansion of the freight terminal at Chaozhou port are in the progress of construction. In addition, several other port construction projects are currently under planning stages. We have further assessed the overall budgeted project management costs for each of the key planned projects and compare against the standards set on the Xiamen Finance Bureau Notice. In particular, Ji’an land-based port in Jiangxi Province has a budget of RMB90 million with project commencement in May 2016 and completion in June 2017. The project comprises of building six warehouses and storage yards of approximately 80,000 square metres in total. Sanming land-based port in Fujian Province comprises of building a logistics park of around 80,000 square metres and storage yard of 46,000 square metres in size. The project has a budget of RMB90 million in total and is to be completed in 2017. The berths no. 20 to no. 21 of Haicang port area started in 2012 with a total project budget of RMB1.4 billion spreading over the construction period of approximately seven years whilst the freight terminal project at Chaozhou port has total budget of RMB490 million and is to be completed by 2017. After assessing the above budgets with the relevant standards set by the Xiamen Finance Bureau Notice, we concur with the Directors’ estimate therefor and note that the estimation of project management fee to be paid in material respects with an average of around 2.5% is basically applicable to the guidelines as referred in the Xiamen Finance Bureau Notice. Accordingly, we consider that the proposed Annual Caps for the transactions contemplated under the 2015 Master Project Management Agreement are justifiable, fair and reasonable.

D. Port facilities engineering and maintenance services

Pursuant to the 2015 Master Engineering Agreement, Xiamen Port Holding Group will provide the Group with (i) berth construction and maintenance and voyage channel clearing and maintenance services; (ii) berth structure and facilities renovation and maintenance services; (iii) building construction and interior engineering services; and (iv) other related port engineering services that the parties may agree.

— 55 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

are beneficial to the Group as a whole since Xiamen Port Holding Group possesses the required experience and staff to undertake such functions. Based on previous transactions with the Group, relevant members of Xiamen Port Holding Group are experienced and accustomed to the operations of port business of the Group and hence have a sound understanding of the standards and quality required for the relevant services. Retaining Xiamen Port Holding Group to provide the relevant services would also ensure operational continuity and minimise any disruptions to the operations and business of the Group.

Pricing policy and other material terms

Pursuant to the 2015 Master Engineering Agreement, charges for the relevant services are determined on pricing terms no less favourable than those normally charged by Xiamen Port Holding Group to the independent third parties according to the following pricing principles:

(i) by reference to and in strict accordance with, if any, the relevant pricing guideline issued by MOT and MHURD, Fujian HURD and other relevant government authorities from time to time (including, without limitation, (i) the Notice relating to the Announcement of the Requirements for Formulation of Budgetary Estimates and Final Budget for Coastal Port Construction Works and Ancillary Fixed Sums* 《( 關於發佈沿海港口建設工程概預算編製規定及配套定額的通知》) issued by MOT in 2004 which sets out the pricing standards for coastal port construction works in Xiamen (typical components of which include main construction items, ancillary production construction items, public works and amenities works); (ii) the Code of Bills of Quantities and Valuation for Construction Works 《( 建設工程工程量清單計價規範》) issued by MHURD effective from July 2013 MOT which regulates the pricing methods for contracting and implementation of construction works in PRC and in particular, provides that actual pricing of construction works shall be estimated by taking into account of the following components: (a) fees for work sections and trades; (b) fees for preliminaries; (c) fee for other items; (d) statutory fees; and (e) tax; and (iii) the notices issued by Fujian HURD as to consumption of construction materials in respect of different types of works in Xiamen, such as construction works, installation works and urban services works); and

(ii) taking into account of the comparable local average market price and market condition in Xiamen and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding Group by reference to historical rate.

The Group will make payments in instalments under the 2015 Master Engineering Agreement (i) upon signing of the relevant implementation agreements; (ii) during course of services by way of progress payments; and (iii) upon completion of the post-construction inspection, respectively. The Directors consider that such payment arrangement is in line with the prevailing industry practice for port-related construction projects conducted in the PRC and is therefore fair and reasonable as a whole. Based on our experience in reviewing certain companies which are engaging in engineering and construction works (particularly in the PRC), it has been a common practice to make an initial payment prior to the commencement of the relevant work under construction contracts. Accordingly, we concur with the Directors’ view in this regard.

— 56 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Pursuant to the 2015 Master Engineering Agreement, the Group has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group.

We have been further advised by the Directors that charges for the port facilities engineering and construction services are required to be set in accordance with the prices as prescribed by the MOT and as prescribed in the relevant rules and guidelines set by the State and local government.

Given that the charges under the 2015 Master Engineering Agreement shall be determined with reference to the relevant pricing guidelines issued by the MOT, MHURD and Fujian HURD. We have conducted review of the same regulatory guidelines issued by MOT, MHURD and Fujian HURD and concur that the relevant services under 2015 Master Engineering Agreement will be priced in line with the relevant regulatory guidelines. In addition, the costs shall be determined in consideration of comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding Group by reference to historical rate. As such, we are of the view that the transactions contemplated under the 2015 Master Engineering Agreement are conducted in the ordinary and usual course of business of the Group, are on normal commercial terms, and the terms of such transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Further, we have noted from the 2015 Master Engineering Agreement that (i) the Group has the right to choose a third party to provide the relevant services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding; and (ii) the Group is entitled to terminate the agreement unilaterally whilst Xiamen Port Holding does not entitled to the same right thereunder. We are of the view that such provisions provide further flexibility to the Group for better securing its benefits from the arrangement and are in the interests of the Company and the Shareholders as a whole.

Annual Caps

The proposed Annual Caps for the three years ending 31 December 2018 for the transactions contemplated under the 2015 Master Engineering Agreement are RMB180 million, RMB197 million and RMB210 million respectively, which have been determined by considering the following factors:

• historical transaction amounts;

• the number and extent of the Group’s on-going and planned new construction works during the relevant period;

• the Group’s facilities maintenance and renovation plan during the relevant period, assuming that all such works will be undertaken by the Xiamen Port Holding Group;

• estimated aggregate annual capital expenditure budgeted for the Group’s on-going and planned projects during the relevant period includes, without limitation to, (i) construction projects of berths no. 20 to no. 21 of Haicang port area; (ii) dredging and related works at the turning basins of Xiamen Songyu Terminal and other terminals in Haicang port area; (iii) engineering projects relating to the expansion of the freight

— 57 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

terminal at Chaozhou port; (iv) major construction projects relating to Ji’an land- based port in Jiangxi Province and Sanming land-based port in Fujian Province; (v) works relating to the construction of the inter-connection highway at Zhangzhou Gulei and the related berths at Zhangzhou Longchi; and (vi) maintenance works of the Group’s certain berth-related highways, storage yards and construction facilities;

• estimated workload, building materials and equipment required, as well as complexity and technical uniqueness of each of the abovementioned projects; and

• reasonable upward margin reserved for each year for possible project construction cost inflation and other contingency reasons (such as emergency repair or irregular maintenance), the extent of which is determined by reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

The proposed Annual Cap for the year ending 31 December 2016 is RMB180 million, representing approximately 2.4 times over that of the anticipated transaction amount of approximately RMB53.1 million for the full year ending 31 December 2015. We have noted that the annual caps for the two years ended 31 December 2013 and 2014 were relatively under-utilised which, as advised by the Management, was due to the postponement of certain previously planned engineering and maintenance works. However, as mentioned above, there are at least six larger construction and engineering projects that have been or to be conducted in the recent years with an estimated total investment amount over approximately RMB3,100 million, part of the construction works of which with budgeted costs up to approximately RMB182 million would be incurred for such planned projects and be undertaken by Xiamen Port Holding Group. Based on our discussion with the Management and review of the Group’s construction budget with calculation basis, we consider that the basis for determination of the proposed Annual Caps for the construction and engineering works to be conducted pursuant to 2015 Master Engineering Agreement are justifiable and prudent.

Please find details and the basis for determining the relevant budgeted amount of the abovementioned six projects during the relevant period under the section “Annual Caps” relating to the 2015 Construction Project Management Agreement above.

In assessing the fairness and reasonableness of the proposed Annual Caps, we have conducted independent review for setting the relevant proposed Annual Caps, the Group’s business planning on those engineering works planned to be conducted, the historical actual transaction amounts and annual caps’ setting over the past years. We have been advised by the Directors that the utilisation rate of the Group’s port facilities is a major factor for determining the requirement of the port facilities engineering and maintenance services. Following the JV Formation, there will be four newly acquired terminals to be included under the Group, resulting in a much stronger business foundation and much larger port areas to be occupied accordingly for its port operations. Therefore, it is commercially necessary for implementation of more engineering and maintenance works and services for the Group’s existing and additional port facilities, and accordingly it is justifiable and necessary for the Group in setting the proposed Annual Caps as above for the three years ending 31 December 2018. As confirmed by the Directors, most of the key planned construction and maintenance works are currently expected to be commenced starting from 2016. On such basis, we consider that the proposed Annual Caps for the transactions contemplated under the 2015 Master Engineering Agreement are justifiable, fair and reasonable.

— 58 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

E. Labour services

On 23 October 2013, Xiamen Port Services (formerly known as 廈門港務集團勞動服務有限公司 (Xiamen Port Group Labour Services Co., Ltd.*)) (a wholly-owned subsidiary of Xiamen Port Holding) and the Group entered into the 2013 Master Labour Services Agreement, pursuant to which Xiamen Port Services shall provide the Group certain port-related labour services. The 2013 Master Labour Services Agreement has a term of two years which will expire on 31 December 2015. From 1 January 2016, these labour services will be provided by Xiamen Port Holding Group in substitution of Xiamen Port Services.

On 20 October 2015, Xiamen Port Holding Group and the Group have entered into a new labour service contract, namely the 2015 Master Labour Services Agreement, in order to secure these services for a further term of three years from 1 January 2016 to 31 December 2018.

Pursuant to the 2015 Master Labour Services Agreement, Xiamen Port Holding Group has agreed to provide certain port-related services to the Group, including (i) bundling and unbundling of the reinforced components of container and general cargo; (ii) bulk cargo packaging and unwrapping; (iii) container mantling and dismantling; and (iv) other ancillary labour services as agreed by the contracting parties.

Pricing policy and other material terms

Pursuant to the 2015 Master Labour Services Agreement, charges shall be negotiated and determined by the parties in good faith on pricing terms no less favourable than those normally applicable to independent third parties by Xiamen Port Holding Group. The following pricing principles have been taken into consideration:

(i) by reference to the relevant pricing guideline relating to minimum wage standard for the labour market issued by Xiamen HRSS from time to time, including, without limitation, the Xiamen HRSS Notice;

(iii) the above agreed standard rates may be adjusted within a range of 10% each year over the preceding year’s rates with reference to prevailing governmental index of consumer price and local market rates.

We have been advised by the Directors that, as set out in the Xiamen HRSS Notice, the prescribed rate applicable to the provision of such labour services ranging from RMB3,506 to RMB8,581 per month per person. Meanwhile, the annual increment, which is capped at 10%, is to cover the rate changes due to fluctuations in the consumer price index and market labour rates to retain the experienced labour force providing the relevant services to the Group. On such basis, we consider that it is justifiable for the contracting parties to provide a reasonable buffer to accommodate any upward price changes in the coming years.

Unless otherwise agreed by the parties in the implementation agreements, charges incurred will be settled on a monthly basis through bank transfer.

— 59 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The Group has the right to choose a third party to provide these services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group pursuant to the 2015 Master Labour Services Agreement.

Given that (i) the charges under the 2015 Master Labour Services Agreement shall be determined with reference to the relevant pricing guideline relating to minimum wage standard for the labour market issued by Xiamen HRSS from time to time, and taking into account of the comparable local average market price and market condition in Xiamen and the reasonable cost plus reasonable profit margin of Xiamen Port Holding by reference to historical rate; (ii) the adjustment mechanism will be based on the prevailing governmental index of consumer price and local market rates; and (iii) Xiamen Port Holding Group shall provide the relevant services to the Group on terms no less favourable than those offered to any independent third parties, we are of the view that the transactions contemplated under the 2015 Master Labour Services Agreement are conducted in the ordinary and usual course of business of the Group, on normal commercial terms, and the terms of such transactions are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

Further, we have noted from the 2015 Master Labour Services Agreement that (i) the Group has the right to choose a third party to provide the relevant services if such party can provide comparable services on terms more favourable than those offered by Xiamen Port Holding Group; and (ii) the Group is entitled to terminate the agreement unilaterally whilst Xiamen Port Holding does not entitled to the same right thereunder. We are of the view that such provisions provide further flexibility to the Group for better securing its benefits from the arrangement and are in the interests of the Company and the Shareholders as a whole.

Annual Caps

The proposed Annual Caps for the transactions contemplated under the 2015 Master Labour Services Agreement are RMB100 million, RMB120 million and RMB135 million for each of three years ending 31 December 2018, respectively, which have been determined after taken the following specific factors into account:

• historical transaction amounts;

• estimated organic annual growth in the international and domestic trade handling throughput of the Group during the relevant period by approximately 7% to 12% per year;

• estimated consequential annual growth in the demand for manpower and labour services at the Group’s terminals operated by the Group during the relevant period driven by the aforesaid estimated organic growth in the Group’s international and domestic trade handling throughput;

• estimated annual increase in the service fees payable by the Group due to price and labour cost inflation by approximately 5% to 10% per year; and

• reasonable upward margin ranging from 17% to 17.8% reserved for each year during the term for contingency reasons, the extent of which is determined with reference to the historical transaction amounts and based on the relevant commercial experience of the Group.

— 60 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We understand that the historical/anticipated transaction amounts regarding the labour services are approximately RMB32.85 million and RMB45.1 million for the two years ending 31 December 2014 and 2015, respectively, representing an annual increase of approximately 37.4% over the two years. According to the statistics released by Xiamen LTB, the Average Wage during the period from 2005 to 2014 represents a CAGR of approximately 10.4%. We have also noted from the 2015 Interim Report that the throughputs of the container port business of the Group for the six months ended 30 June 2015 increased by approximately 9.6% on a period- on-period basis respectively. In addition, the Group is planning to lease and operate the newly completed berths from the corresponding parties and to acquire further equity interests in the terminals already operated by it in the next three years, and the relevant revenue and operating costs would be consolidated into the Group following completion of the leases/acquisitions, which will be resulting in a much stronger business foundation and much larger port areas to be occupied by the Group for its port operations thereafter. Meanwhile, after the completion of the JV Formation in 2014, the Group has gradually been occupying much wider port areas along the coastal line of Xiamen Port. In particular, the Group has been undertaking certain construction/variation/rectification works for the newly-acquired port areas of approximately 3,433,200 square metres for the purposes of increasing the operating areas within the Xiamen Port (i.e. in the areas that were previously unused/spare for non-operating purpose). Those works include (i) the container yard modification works in the Xiangyu Terminal starting in May 2015 with expected completion date in February 2016 and budget of RMB30 million; (ii) the container yard modification works in the Haitian Terminal starting in May 2015 with expected completion date in January 2016 and budget of RMB15 million; and (iii) the auxiliary projects of the “from oil to electricity” transformation works in the Songyu Terminal starting in October 2015 with expected completion date in April 2016 and budget of RMB8 million. Those works aim to enhance the operating efficiency/capability of such port areas by approximately 20% upon their completion. Accordingly, during the progress of such works and following their gradual completion thereafter, the Group’s demand for labour services has been and would be increased by around 12% during the coming three years to cope with the newly completed operating port areas. Meanwhile, the planned acquisition of further equity interests in the terminals already operated by it is expected to incur an additional labour costs of up to RMB44.5 million over the coming three years, while the CAGR of approximately 16.2% in the proposed Annual Caps for each of the two years ending 31 December 2017 and 2018 is to provide a reasonable buffer to accommodate any increase in the demand for labour services at other existing ports in the subsequent two years.

In assessing the fairness and reasonableness of the proposed Annual Caps, we have conducted independent review of the Group’s business planning, the historical actual transaction amounts and annual caps’ setting over the past years, we understand that the Group has projected the proposed Annual Cap amounts by taking into account (i) the expected increase in the relevant operating costs, in particular the costs for labour services, would be included in the Group following the completion of the leases and operations of the newly completed berths and/ or acquisitions for further equity interest in the corresponding terminals, which would amount up to approximately RMB44.5 million; (ii) a reasonable annual increase in the service fee by 5% to 10% which is comparable to Average Wage; (iii) a moderate buffer on the estimated consequential growth in the demand for manpower and labour services at the Group’s terminals driven by the estimated increase in the Group’s international and domestic trade handling throughput, which comprising an upward margin reserved for any contingency reasons; and (iv) the ongoing construction/variation/rectification works for the newly-acquired port areas within the Xiamen Port. Based on our review of the 2015 Interim Report, the container throughput attributable to the corresponding terminals to be further acquired had achieved its operating

— 61 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

capability of approximately 705,000 TEUs for the six months ended 30 June 2015, representing a significant increase by approximately 264.9% when compared to that of approximately 193,225 TEUs for the corresponding period in 2014. Going forward, it is the Management’s assessment that the corresponding terminals would continue its growth in the foreseeable future, which in turn will generate further demand for labour services on top of the ongoing construction/ variation/rectification works for the newly-acquired port areas within the Xiamen Port. The growth meanwhile will also facilitate the implementation of the Group’s business plan to achieve a better result. Accordingly, we are of the view that the basis for determination of, though there would be significant increases in, the proposed Annual Caps over 2016 to 2018 is justifiable.

Since (i) the proposed Annual Cap for the year ending 31 December 2016 is calculated based on a historical transaction amount, the CAGR regarding the Average Wage of approximately 10.4%, and the potential inclusion of additional operating costs attributable to the leases of the newly completed berths and further acquired equity interests in the corresponding terminals; and (ii) the CAGR of approximately 16.2% in the proposed Annual Cap for the two years ending 31 December 2017 and 2018 is to provide a reasonable buffer to accommodate the possible growth of business volume in the subsequent two years, we consider that the proposed Annual Caps for the transactions contemplated under the 2015 Master Labour Services Agreement are fair and reasonable.

7. Internal control measures regarding the Continuing Connected Transactions

As set out in the “Letter from the Board” in the Circular, the Group has established stringent internal control procedures to ensure that the fees to be paid and received by the Group, and the pricing basis of the transactions contemplated under, among others, the 2015 General Services Agreements (including, without limitation, the scope of services contemplated thereunder as well as the pricing basis and the payment terms of such services) have no material changes as compared to that in the 2013 General Services Agreements. The pricing basis will be fair and reasonable and is on normal commercial terms or better, including, without limitation of the following:

(i) the finance department of the Group will use all commercially reasonable approaches to periodically (and in any event at least every three months) request the counterparty to provide their prices and transaction records relating to the transactions with other connected or independent third parties for the Group’s internal assessment and evaluation before entering into any implementation agreements pursuant to, among others, the 2015 General Services Agreements by comparing such records provided by the relevant members of Xiamen Port Holding Group with the terms of transactions in similar nature and of similar size that have been conducted between the Group and other independent third parties;

(ii) the finance department of the Group will use all commercially reasonable approaches to periodically (and in any event at least every three months) gather market intelligence from a sufficient number of independent third parties in Xiamen for internal analysis. In addition, given that comparable transactions in the local market are available as to the transactions contemplated under the 2015 General Services Agreement, it will also compare the terms quoted from the relevant members of Xiamen Port Holding Group relating to the transactions contemplated under the 2015 General Services Agreement with the quoted terms from at least two independent third parties in Xiamen providing services of similar nature (if available) to ascertain the comparable local average market price in Xiamen in order to ensure that the most favourable terms can be obtained by the Group before entering into any implementation agreements pursuant to the 2015 General Services Agreements;

— 62 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(iii) the operational units of the Group shall report the relevant transaction values in respect of the transactions contemplated under, among others, the 2015 General Services Agreements in writing to the finance department of the Group on a monthly basis;

(iv) the secretariat of the Board and the finance department of the Group have implemented effective internal rules and policies that proactively and specifically monitors records and the transaction values in respect of the transactions contemplated under, among others, the 2015 General Services Agreements to ensure (i) strict adherence to the pricing principles and terms as agreed in the 2015 General Services Agreements; and (ii) the respective actual aggregated transaction amounts will not exceed the relevant Annual Caps, such as (i) conducting monthly and random internal independent examination and audit; and (ii) providing regular training to the management team of the Group’s operating units to strengthen and enhance their understanding of the importance and operation of the relevant reporting and disclosure requirements under the Listing Rules);

(v) the Group’s Company Secretary in Xiamen is authorised by the Board to (i) coordinate, supervise and assess the intra-group check-and-balance mechanisms so as to identify financial and operational irregularities (if any) which may arise from the execution of, among others, the 2015 General Services Agreements and (ii) closely scrutinise any development or update of the relevant PRC and Hong Kong laws and regulations (including, without limitation, the PRC governmental pricing guidelines applicable to the pricing of the transactions contemplated under the 2015 General Services Agreement and the requirements under Chapter 14A of the Listing Rules) and properly brief the Board, the finance department and the operational units of the Group so as to ensure strict adherence to the abovementioned pricing guidelines and legal and regulatory compliance in a timely manner;

(vi) the entering into of any implementation agreements in respect of the transactions contemplated under the 2015 General Services Agreements shall be jointly approved by an Executive Director of the Company designated by the Board for such specific purpose and the Company’s General Manager;

(vii) the external auditors of the Company will be engaged to review the transaction values in respect of the transactions contemplated under the 2015 General Services Agreements in compliance with the annual reporting and review requirements under the Listing Rules and provide confirmation in the Company’s annual report on whether such transaction are entered into in the ordinary course of business on normal commercial terms or better and are carried out pursuant to the terms thereof, and whether the terms thereof are fair and reasonable and in the interests of the Company and the Shareholders as a whole;

(viii) the Company’s Audit Committee will review the implementation of the 2015 General Services Agreement at least twice a year as part of its review of the operation and effectiveness of the Company’s internal control procedures; and

(ix) the independent non-executive Directors of the Company will conduct an annual review of the implementation of the 2015 General Services Agreement pursuant to the requirement under the Listing Rules.

In view of the above, the Board considers that sufficient and effective internal control measures are in place to ensure that the transactions contemplated under, among others, the 2015 General Services Agreements will be conducted on normal commercial terms or better and at prices not more favourable to

— 63 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER the relevant members of the Xiamen Port Holding Group than transactions entered into with independent third parties and hence will not prejudicial to the interests of the Group and its shareholders as a whole. In addition, (i) as at the Latest Practicable Date, and to the best of the Board’s knowledge, belief and information, having made all reasonable enquiries, there is no circumstance relating to the entering into and the terms of, among others, the 2015 General Services Agreements which is unfavourable to the Group; and (ii) the Board (including the independent non-executive Directors) is of the view that the principal terms of the 2015 General Services Agreements (including, without limitation, the scope of services contemplated thereunder as well as the pricing basis and the payment terms of such services) have no material changes as compared to that in the 2013 General Services Agreements.

In addition, please refer to the “Letter from the Board” of the Circular for details of the existing internal control procedures over the payment terms and pricing basis of the Continuing Connected Transactions contemplated under each of the five 2015 General Services Agreements. Based on our review of the contract implementation under 2013 General Services Agreements, we have noted that the corresponding pricing guidelines have been followed, whilst comparable local average market price and cost plus reasonable profit margin approach were among the options available to the pricing of the relevant services. Given the unique industry nature and strategic market position as the largest port operator in Xiamen, the Group has often encountered difficulty in collecting sufficient market data/information which can be closely comparable to its own service requirements. As such, the Group has subsequently followed and adhered to the relevant regulatory guidelines in the service pricing under 2013 General Services Agreements. Further, as each of the agreements under 2013 General Services Agreements has its own governmental/regulatory guidelines, according to our review, the pricing procedures of the services have followed their corresponding guidelines as set out by the relevant authorities. As suggested by the Management, Xiamen Port Holding Group will not provide all the services pursuant to the Master General Services Agreements to independent third parties under normal circumstances. This will result in that no market price is available to the relevant services. However, as the pricing of each of the services will closely follow its regulatory guidelines and the corresponding guidelines are commonly used to set out the industrial standard and minimum charge level of the corresponding services, we therefore are of the view that the terms provided by Xiamen Port Holding Group will be no less favourable to the Company. Meanwhile, after consideration of the internal control procedures and further discussion with the Management regarding the actual implementation, we are of the view that the Group has established sufficient internal control measures to ensure that each of the Continuing Connected Transactions will be conducted on normal commercial terms (including the pricing basis) which are no less favourable than those available from independent third parties to the Group.

Based on the Group’s above internal control procedures and policies, the Group would make best endeavour to compare the terms quoted from the relevant members of Xiamen Port Holding Group relating to the transactions contemplated under the 2015 General Services Agreements with the quoted terms from at least two independent third parties in Xiamen providing services of similar nature (if available) to ascertain the comparable local average market price in Xiamen in order to ensure that the most favourable terms can be obtained by the Group before entering into any implementation agreements pursuant to the 2015 General Services Agreements. On the other hand, having considered the Group’s unique industry nature and strategic market position as the largest port operator in Xiamen, it may encounter difficulty in obtaining sufficient source of transaction records and pricing data from independent third parties for comparable bench-marking prior to entering into any implementation agreements pursuant to the 2015 General Services Agreements, but we consider that the actual implementation therefor would still be acceptable on the grounds that the pricing of each of the services thereunder will closely follow its relevant regulatory guidelines and the corresponding guidelines which are commonly used to set out the industrial standard and minimum charge level of the corresponding services, whilst other service providers in the market are basically discouraged to adopt their charge rates materially deviated from that set out in such

— 64 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Standard Criteria, MHURD and relevant pricing guidelines in Xiamen. Further, as a Board designated Executive Director and a General Manager of the Company are to approve the implementation agreements in respect of the transactions contemplated under the 2015 General Services Agreements whilst the agreement implementation are to be reviewed by the external auditors, the Company’s Audit Committee, and subsequently the independent non-executive Directors, we are of the view that the present internal control policies, approval procedures and authority of each transaction to be conducted pursuant to 2015 General Services Agreements would be no less favourable to the Company and ultimately safeguard the interests of the Company and the Shareholders as a whole.

Apart from the above, the Continuing Connected Transactions are also subject to a number of annual review requirements under the Listing Rules which include:

(i) each year the independent non-executive Directors must review the Continuing Connected Transactions and confirm in the annual report and accounts of the Company that the Continuing Connected Transactions have been entered into (a) in the ordinary and usual course of business of the Company; (b) on normal commercial terms or better; and (c) in accordance with the agreement governing them on terms that are fair and reasonable and in the interests of the Shareholders as a whole;

(ii) each year the auditors of the Company must provide a letter to the Board (with a copy provided to the Stock Exchange at least 10 business days prior to the bulk printing of the annual report of the Company) confirming whether anything has come to their attention that causes them to believe that the Continuing Connected Transactions (a) have not been approved by the Board; (b) were not, in all material respects, in accordance with the pricing policies of the Company for those Continuing Connected Transactions involving the provision of services to the Company; (c) were not entered into, in all material respects, in accordance with the relevant agreement(s) governing the Continuing Connected Transactions; and (d) have exceeded the respective Annual Caps;

(iii) the Company will allow, and will procure that the counterparties will allow, the auditors of the Company sufficient access to the relevant records of the Continuing Connected Transactions for the purpose of reporting on the Continuing Connected Transactions. The Board must state in the Company’s annual report whether its auditors have confirmed the matters stated in paragraph (ii) above; and

(iv) the Company must promptly notify the Stock Exchange and publish an announcement in accordance with the Listing Rules if the independent non-executive Directors and/or the auditors cannot confirm the abovementioned matters.

In light of the internal control measures and procedures and reporting requirements attached to the Continuing Connected Transactions as covered above, in particular, (i) the internal assessment and evaluation of the payment terms and pricing basis of the Continuing Connected Transactions; (ii) the internal reporting and intra-group check-and-balance mechanisms; (iii) the restriction of the value of the Continuing Connected Transactions by way of the Annual Caps; and (iv) the ongoing review by the independent non-executive Directors and the auditors of the Company on the terms of the Continuing Connected Transactions (in particular, whether the Annual Caps have been exceeded), we are of the view that appropriate measures are, and will continue to be in place to govern the conduct of the Continuing Connected Transactions and safeguard the interests of the Independent Shareholders.

— 65 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

RECOMMENDATION

Having taken into account the principal factors and reasons as referred to the above, we are of the view that the 2015 General Services Agreements and the Continuing Connected Transactions (together with the proposed Annual Caps) are on normal commercial terms and conducted in the ordinary and usual course of business of the Group, in the interests of the Company and the Shareholders as a whole, and fair and reasonable so far as the Independent Shareholders are concerned. Accordingly, we advise the Independent Shareholders as well as the Independent Board Committee to recommend the Independent Shareholders to vote in favour of the resolution to be proposed at the EGM to approve the Continuing Connected Transactions and the proposed Annual Caps pursuant to the 2015 General Services Agreements.

Yours faithfully, For and on behalf of First Shanghai Capital Limited Fanny Lee Nicholas Cheng Managing Director Director

Note:

Ms. Fanny Lee and Mr. Nicholas Cheng have been the Responsible Officers of Type 6 (advising on corporate finance) regulated activity under the SFO and have many years of experience in corporate finance industry. Both of them have participated in the provision of independent financial advisory services for various connected transactions involving companies listed in Hong Kong.

— 66 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

APPENDIX — GENERAL INFORMATION

1. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. DIRECTORS’, SUPERVISORS’ AND CHIEF EXECUTIVES’ INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND DEBENTURES

As at the Latest Practicable Date, none of the Directors, Supervisors or chief executives of the Company or their associates had any interests in the shares, underlying shares and debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which would have to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which any Director, Supervisor or chief executives of the Company was deemed or taken to be under such provisions of the SFO), or which would be required, pursuant to section 352 of the SFO, to be entered in the register required to be kept by the Company or which would be required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers as contained in Appendix 10 to the Listing Rules.

At the Latest Practicable Date, save as disclosed below, none of the Directors or Supervisors was a director or employee of a company which has any interests or short positions in the shares and underlying shares of equity derivatives or debentures of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO:

Name of Director Positions held in Xiamen Port Holding

Mr. Lin Kaibiao Deputy General Manager Mr. Zheng Yongen Director Mr. Chen Dingyu Director Mr. Fu Chengjing Director Mr. Huang Zirong Chief Engineer

3. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had entered into, or proposed to enter into, a service contract with any member of the Group which does not expire or is not determinable by such member of the Group within one year without payment of compensation, other than statutory compensation.

— 67 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

APPENDIX — GENERAL INFORMATION

4. DIRECTORS’ AND SUPERVISORS’ INTERESTS IN ASSETS, CONTRACTS AND COMPETING BUSINESS

As at the Latest Practicable Date,

(i) none of the Directors or Supervisors was materially interested in any contract or arrangement subsisting at the Latest Practicable Date, which is significant in relation to the business of the Group, apart from their service contracts;

(ii) none of the Directors or Supervisor(s) and his/her respective associates had any competing interests (as would be required to disclose under Rule 8.10 of the Listing Rules if each of them were a controlling shareholder); and

(iii) none of the Directors or any proposed Director had any direct or indirect interest in any assets which had been, since the date to which the latest published audited financial statements of the Group were made up, acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

5. MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors are not aware of any material adverse change in the financial or trading position of the Group since 31 December 2014, being the date to which the latest published audited financial statements of the Group were made up.

6. QUALIFICATIONS AND CONSENT

The following is the qualifications of the Independent Financial Adviser who has given opinions or advice contained or referred to in this circular:

Name Qualifications

First Shanghai a licensed corporation to carry out type 6 (advising on corporate finance) regulated activity under the SFO

First Shanghai has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and references to its name in the form and context in which they respectively appear.

As at the Latest Practicable Date, First Shanghai had no interest, direct or indirect, in any member of the Group nor the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, First Shanghai had no interest, direct or indirect, in any assets which had been, since the date to which the latest published audited financial statements of the Group were made up, acquired or disposed of by or leased to any member of the Group, or which were proposed to be acquired or disposed of by or leased to any member of the Group.

— 68 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

APPENDIX — GENERAL INFORMATION

7. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection during the normal business hours of any Working Day at the principal place of business of the Company in Hong Kong at 36/F, Tower Two, Times Square, 1 Matheson Street, Causeway Bay, Hong Kong from 29 November 2015 up to and including the date of the EGM:

(a) the 2015 Master Property Services Agreement;

(b) the 2015 Comprehensive Services Agreement;

(d) the 2015 Master Engineering Agreement;

(e) the 2015 Master Labour Services Agreement;

(f) the letter from the Independent Financial Adviser, the text of which is set out in this circular;

(g) the written consent referred to in paragraph headed “Qualifications and consent” of this appendix; and

(h) this circular.

— 69 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

NOTICE OF THE EGM

廈門國際港務股份有限公司 XIAMEN INTERNATIONAL PORT CO., LTD* (A joint stock limited company incorporated in the People’s Republic of China with limited liability) (Stock Code: 3378)

NOTICE OF THE THIRD EXTRAORDINARY GENERAL MEETING IN 2015

NOTICE IS HEREBY GIVEN that the third extraordinary general meeting in 2015 (the “EGM”) of Xiamen International Port Co., Ltd (the “Company”) will be held at 9:00 a.m. on Wednesday, 30 December 2015 at 23rd Floor, Conference Room, No.31 Donggang North Road, Xiamen, the People’s Republic of China (“PRC”) for the purposes of considering and, if thought fit, passing the following resolution (unless otherwise indicated, capitalised terms used herein shall have the same meaning as those defined in the circular of the Company in relation to the EGM dated 13 November 2015 (the “Circular”)):

AS ORDINARY RESOLUTION

1. “THAT (a)(i) the 2015 Master Property Services Agreement dated 20 October 2015 entered into between the Company and Xiamen Port Construction Group Co., Ltd.; (a)(ii) the 2015 Comprehensive Services Agreement dated 20 October 2015 entered into by Xiamen Port Holding Group Co., Ltd, the Company and Xiamen Port Development Co., Ltd.; (a)(iii) the 2015 Master Project Management Agreement dated 20 October 2015 entered into between the Company and Xiamen Port Construction Group Co. Ltd.; (a)(iv) the 2015 Master Engineering Agreement dated 20 October 2015 entered into between the Company and Xiamen Port Holding Group Co., Ltd.; (a)(v) the 2015 Master Labour Services Agreement dated 20 October 2015 entered into between the Company and Xiamen Port Holding Group Co., Ltd (copies of which are tabled at the meeting and marked “A” and initialled by the Chairman of the meeting for identification purpose); and (b) the aggregate annual general services caps of the 2015 General Services Agreements (as defined in the Circular) for the three years ending 31 December 2018; and (c) the continuing connected transactions (as defined in the Listing Rules) contemplated thereunder, be and are hereby approved, ratified and confirmed.”

By order of the Board Xiamen International Port Co., Ltd. Yang Hongtu Joint Company Secretary

Xiamen, the PRC, 13 November, 2015

As at the date of this notice, the executive directors of the Company are Mr. Lin Kaibiao, Mr. Fang Yao, Mr. Huang Zirong and Mr. Ke Dong; the non-executive directors of the Company are Mr. Zheng Yongen, Mr. Chen Dingyu and Mr. Fu Chengjing; and the independent non-executive directors of the Company are Mr. Liu Feng, Mr. Hui Wang Chuen, Mr. Lin Pengjiu, Mr. Huang Shumeng and Mr. Shao Zheping.

* For identification purpose only

— 70 — 71603 \ (Xiamen EGM) \ 07/11/2015 \ M28

NOTICE OF THE EGM

Notes:

1. Pursuant to Rule 13.39 of the Listing Rules, all votes of the Shareholders at the general meetings must be taken by poll. The Chairman of the meeting will therefore demand a poll for every resolution put to the vote for this EGM, pursuant to the Articles of Association of the Company.

2. In order to determine the list of shareholders who are entitled to attend the EGM of the Company, the registers of members will be closed from Monday, 30 November 2015 to Wednesday, 30 December 2015, both days inclusive, during which period no transfer of shares will be effected. Holders of the Company’s H Shares and Domestic Shares whose names appeared on the registers of members on Monday, 30 November 2015 are entitled to attend the EGM. In order to qualify to attend and vote at the EGM, holders of H Shares of the Company whose transfers have not been registered shall deposit the transfer documents together with the relevant share certificates at the H Share Registrar of the Company, Computershare Hong Kong Investor Services Limited, at or before 4:30 p.m. on Friday, 27 November 2015. The address of the transfer office of Computershare Hong Kong Investor Services Limited is Shops 1712–1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.

3. A shareholder entitled to attend and vote at the EGM may appoint one or more proxies to attend and vote in his stead. A proxy need not be a shareholder of the Company.

4. The instrument appointing a proxy must be in writing under the hand of a shareholder or his attorney duly authorised in writing. If the shareholder is a corporation, that instrument must be either under its common seal or under the hand of its director(s) or duly authorised attorney(s). If that instrument is signed by an attorney of the shareholder, the power of attorney authorising that attorney to sign or other authorisation document must be notarised.

5. In order to be valid, the form of proxy together with the power of attorney or other authorisation document (if any) must be deposited at the secretariat of the Board of the Company for holders of domestic shares and at the H share registrar of the Company for holders of H shares not less than 24 hours before the time fixed for holding the EGM or any adjournment thereof (as the case may be). Completion and return of a form of proxy will not preclude a shareholder from attending and voting in person at the meeting if he/she so wishes. The name and address of the H share registrar of the Company is set out in note 2 above.

6. Shareholders who intend to attend the EGM in person or by proxy should return the confirmation slip to the Company’s principal place of business in PRC or Hong Kong on or before Thursday, 10 December 2015 by hand, by post or by fax. The Company’s principal place of business in the PRC is at 22nd Floor, No.31 Donggang North Road, Xiamen, PRC (Tel: 86-592-5829478, Fax: 86-592- 5653378/86-592-5613177). The Company’s principal place of business in Hong Kong is at 36/F, Tower Two, Times Square, 1 Matheson Street, Causeway Bay, Hong Kong (Tel: 852-35898899, Fax: 852-35898555).

7. The EGM is expected to be concluded within half a day. Shareholders (in person or by proxy) attending the EGM are responsible for their own transportation and accommodation expenses. Shareholders or their proxies attending the meeting shall produce their identity documents.

— 71 —