Concord Medical's shareholders adopt special resolution to create super voting class of shares

Concord Medical Services Holdings Limited ("Concord Medical" or the "Company") (NYSE: CCM), a leading specialty hospital management solution provider and operator of the largest network of radiotherapy and diagnostic imaging centers in China, today announced that a special resolution was adopted by the Company's shareholders at its annual general meeting for the fiscal year ended December 31, 2014 held in Beijing on January 27, 2015 to create a super voting class of shares.

By this special resolution, the Company's shareholders adopted a Fourth Amended and Restated Memorandum and Articles of Association (the "Amended M&A") which incorporates amendments to the Company's authorized share capital. Upon the special resolution being passed by the shareholders, (i) each share issued and outstanding immediately prior to the adoption of the Amended M&A was re-designated as a Class A Ordinary Share; and (ii) a new class of convertible shares was created (the "Class B Ordinary Shares", and together with Class A Ordinary Shares, the "Shares"). The Amended M&A provides that each Class B Ordinary Share entitles the holder thereof to 10 votes on any ordinary resolution or special resolution.

Under the Amended M&A, all of the issued and outstanding Class B Ordinary Shares shall automatically convert into Class A Ordinary Shares, at a ratio of one Class A Ordinary Share for each Class B Ordinary Share, in the event that the total number of issued and outstanding Class B Ordinary Shares is less than 5% of the total number of Shares issued and outstanding. In addition, any Class B Ordinary Share that is sold, transferred, assigned or disposed of by a registered holder or beneficial owner of such Class B Ordinary Share to any person who is not (i) the registered holder or beneficial owner of Class B Ordinary Shares or (ii) an affiliate of the registered holder or beneficial owner of such Class B Ordinary Share being transferred, assigned or disposed of, such Class B Ordinary Share shall automatically convert into one Class A Ordinary Share upon the completion of such transfer, assignment or disposition. In all other respects, the Class B Ordinary Shares have the same rights and restrictions as the Class A Ordinary Shares.

As set forth in the notice of the annual general meeting, the directors of the Company had resolved, subject to the adoption of the Amended M&A, to issue 45,787,948 Class B Ordinary Shares to Morgancreek Investment Holdings Limited ("Morgancreek"), in exchange of 45,787,948 Class A Ordinary Shares held by Morgancreek (the "Exchange"). As of January 27, 2015, the date of the annual general meeting, Morgancreek held 45,787,948 ordinary shares and 4,660,976 American Depository Shares (representing 13,982,928 ordinary shares) of the Company. Mr. Jianyu Yang, the chairman and chief executive officer of the Company and Mr. Zheng Cheng, the president, chief operating officer and a director of the Company, beneficially owns 60% and 40% equity interest of Morgancreek, respectively. Morgancreek abstained from voting on the special resolution to adopt the Amended M&A. Upon the consummation of the Exchange, Morgancreek will hold 45,787,948 Class B Ordinary Shares and 4,660,976 American Depository Shares (representing 13,982,928 Class A Ordinary Shares) of the Company, representing 44.33% of the total number of the Company's Shares issued and outstanding and 86.28% of the total voting rights of the Company.

The creation of Class B Ordinary Shares and the Exchange are designed to, among other things, ensure the sustainability of the value and mission of the Company, the senior management stability and the long-term execution of the business strategy of the Company and discourage hostile take-over attempts, if such attempts could have the effect of undermining the long-term value of the Company's business and operations.

SOURCE Concord Medical Services Holdings Limited