Art : DISCLOSEABLE TRANSACTION RELATING TO PROVISION OF LOAN AND ADVANCE TO AN ENTITY

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ART GROUP HOLDINGS LIMITED

錦 藝 集 團 控 股 有 限 公 司

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 565)

DISCLOSEABLE TRANSACTION

RELATING TO

PROVISION OF LOAN

AND ADVANCE TO AN ENTITY

THE LOAN AGREEMENT

The Board announces that on 28 April 2021 (after trading hours), the Lender, an indirect wholly-owned subsidiary of the Company entered into the Loan Agreement with the Borrower pursuant to which the Lender has agreed to lend to the Borrower the Loan for a term of 12 months from the drawdown date.

LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Loan exceeds 5% but all of them are less than 25%, the entering into of the Loan Agreement and the transactions contemplated thereunder constitute a discloseable transaction for the Company under Chapter 14 of the Listing Rules and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

As the amount of the financial assistance granted to the Borrower exceeds 8% under the assets ratio as defined under Rule 13.13 of the Listing Rules, the grant of the Loan is also subject to the general disclosure obligations under Rule 13.15 of the Listing Rules.

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THE LOAN AGREEMENT

The Board announces that on 28 April 2021 (after trading hours), the Lender, an indirect wholly-owned subsidiary of the Company entered into the Loan Agreement with the Borrower.

Date:	28 April 2021 (after trading hours)
Parties:	(1) the Lender as the lender
	(2) the Borrower as the borrower
	(3) the Guarantor as the guarantor
Principal loan amount:	RMB250,000,000 (equivalent to approximately
	HK$297,619,000)
Interest rate:	7.5% per annum
Term:	12 months commencing from the loan's drawdown
	date, and drawdown can take place after the Loan
	Agreement becomes effective
Purpose:	The Loan will be used by the Borrower towards its
	working capital to finance its daily funding needs
Repayment:	The Borrower shall repay all the interest accrued on
	the Loan and the principal amount of the Loan on the
	Repayment Date
Early repayment:	At any time prior to the Repayment Date:
	(1) the Borrower may request for early repayment
	by giving to the Lender not less than 3 business
	days prior notice of repayment, and upon written
	consent of the Lender, the Borrower can make
	early repayment of the Loan and the interest
	accrued thereon; and

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	(2) the Lender may request for early repayment by
	giving to the Borrower not less than 30 business
	days prior notice of repayment, and upon written
	consent of the Borrower, the Borrower shall repay
	the Loan and the interest accrued thereon earlier.
Security:	(1) the Guarantor agrees to guarantee the Borrower's
	due performance and payment under the Loan
	Agreement; and
	(2) the Share Charge given by the Guarantor in
	favour of the Lender
Default interest:	If the Borrower fails to pay any sum which becomes
	due under the Loan Agreement, it shall pay interest on
	such unpaid sum from and including the due date up to
	and including the date of actual payment at a default
	rate of 12% per annum
Effective date:	The Loan Agreement will become effective on the date
	on which registration/filing of the Share Charge with
	the relevant authority is completed

The Loan will be financed by the Group's internal resources.

The Lender has assessed the relevant credit risk. Save for the Loan Agreement, there is no other business relationship between the Group and the Borrower. To the best of the Directors' knowledge and information, the Directors are not aware of any default by the Borrower and the Guarantor.

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INFORMATION OF THE GROUP AND THE LENDER

The Company is a company incorporated in the Cayman Islands with limited liability with its securities listed on the Stock Exchange (stock code: 565.hk). The Group is principally engaged in property operating business and biotechnology business, which is a newly- introduced segment to be further developed.

The Lender is a company established in the PRC with limited liability and is indirectly wholly-owned by the Company. The principal business activity of the Lender is investment holding.

INFORMATION OF THE BORROWER

The Borrower is a company established in the PRC with limited liability. Its equity interests

are held as to 59% by Pingtan Shengchang Investment Management Partnership (Limited Partnership)* 平潭盛暢投資管理合夥企業（有限合夥）("Pingtan Partnership") and 41% by Chen Yirui. Pingtan Partnership is a limited partnership established in the PRC and

whose interests are held as to 41% by Chen Yirui, 29.5% by Chen Zhang and 29.5% by Diao Mingren.

The Borrower is principally engaged in gardening and greening landscape design and construction in the PRC.

To the best of the Directors' knowledge, information and belief having made all reasonable enquires, the Borrower and its ultimate beneficial owners are third parties independent of the Company and its connected persons.

INFORMATION OF THE GUARANTOR

The Guarantor is a company established in the PRC with limited liability. Its entire equity interests are held by Zhengzhou Weisheng Investment Co., Ltd.*（鄭州偉盛投資有限公司） ("Zhengzhou Weisheng"). The equity interests of Zhengzhou Weisheng are held as to 80% by

Chen Wei and 20% by Wu Meilin.

The Guarantor is principally engaged in the sale of cotton yarns and textile products.

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The Guarantor holds 25% equity interests in each of the two non-wholly-owned subsidiaries

of the Company, namely Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co., Ltd.*（鄭州中原錦藝商業運營管理有限公司）and Zhengzhou Jiachao Property Services Co., Ltd.*（鄭州佳潮物業服務有限公司）.

To the best of the Directors' knowledge, information and belief having made all reasonable enquires, the Guarantor and its ultimate beneficial owners are third parties independent of the Company and its connected persons.

REASONS FOR AND BENEFITS OF THE LOAN AGREEMENT

The making of the Loan under the Loan Agreement constitutes provision of financial assistance by the Group under the Listing Rules. The terms of the Loan Agreement were negotiated on an arm's length basis by the parties with regarding to, among others, prevailing commercial practices and the security provided. The interest rate charged on the Loan is determined with reference to the market interest rate after arm's length negotiations. Having into consideration (i) the interest income to be received by the Group; and (ii) the credit assessments and repayment ability of the Borrower and the Guarantor, the Directors consider that the terms and conditions of the Loan Agreement are of normal commercial terms, fair and reasonable and are in the interests of the Company and the Shareholders as a whole.

LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratios (as defined under the Listing Rules) in respect of the Loan exceeds 5% but all of them are less than 25%, the entering into of the Loan Agreement and the transactions contemplated thereunder constitute a discloseable transaction for the Company under Chapter 14 of the Listing Rules and is subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.

As the amount of the financial assistance granted to the Borrower exceeds 8% under the assets ratio as defined under Rule 13.13 of the Listing Rules, the grant of the Loan is also subject to the general disclosure obligations under Rule 13.15 of the Listing Rules.

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DEFINITIONS

In this announcement, the following expressions have the following meanings:

"Board"

"Borrower"

the board of Directors

Fujian Qiancheng Lujingguan Engineering Co., Ltd.* （福建千城綠景觀工程有限公司）, a c o m p a n y established in the PRC with limited liability

"Company"	Art Group Holdings Limited a company incorporated
	in the Cayman Islands with limited liability, the shares
	of which are listed on the Stock Exchange

"connected person(s)"

"Director(s)"

"Guarantor"

has the meaning ascribed to it under the Listing Rules

the director(s) of the Company

Henan Diyi Textile Co., Ltd.*（河南第一紡織有限公 司）, a company established in the PRC with limited liability and it holds 25% equity interests in each of the two non-wholly-owned subsidiaries of the Company,

namely Zhengzhou Zhongyuan Jinyi Commercial Operation Management Co., Ltd.*（鄭州中原錦藝 商業運營管理有限公司）and Zhengzhou Jiachao Property Services Co., Ltd.*（鄭州佳潮物業服務有限 公司）

"Group"	the Company and its subsidiaries
"Hong Kong"	the Hong Kong Special Administrative Region of the
	People's Republic of China

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"Lender"

"Listing Rules"

"Loan Agreement"

"Loan"

"PRC"

"Repayment Date"

"RMB"

"Secured Security"

"Share Charge"

Zhengzhou Changdun Asset Management Co., Ltd.*（鄭州 昌盾資產管理有限公司）, a company established in the PRC with limited liability and an indirect wholly-owned

subsidiary of the Company

the Rules Governing the Listing of Securities on the Stock Exchange

the loan agreement dated 28 April 2021 and entered into between the Lender, the Borrower and the Guarantor relating to the provision of the Loan

the loan in the principal amount of RMB250,000,000 (equivalent to approximately HK$297,619,000) granted by the Lender to the Borrower pursuant to the terms of the Loan Agreement

the People's Republic of China

the date falling 12 months following drawdown of the Loan

Renminbi, the lawful currency of the People's Republic of China

25% equity interests in each of Zhengzhou Zhongyuan

Jinyi Commercial Operation Management Co., Ltd.* （鄭 州 中 原 錦 藝 商 業 運 營 管 理 有 限 公 司） a n d Zhengzhou Jiachao Property Services Co., Ltd.*（鄭州 佳潮物業服務有限公司）owned by the Guarantor

the share charge dated 28 April 2021 given by the Guarantor in favour of Lender over the Secured Security to secure the Borrower's liability and obligations under the Loan Agreement

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"Shareholders"	shareholders of the Company
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong

By Order of the Board of

ART GROUP HOLDINGS LIMITED

Chen Jinyan

Chairman

Hong Kong, 28 April 2021

• For identification purpose only

For the purpose of illustration only and unless otherwise stated, amounts denominated in RMB in this announcement have been translated into HK$ at the rate of HK$1.00 = RMB0.84. Such translation should not be construed as a representation that the amounts in question have been, could have been or could be converted at any particular rate or at all.

As at the date of this announcement, the executive directors of the Company are Mr. Chen Jinyan and Mr. Chen Jindong; and the independent non-executive directors of the Company are Mr. Kwan Chi Fai, Mr. Lin Ye, Mr. Yang Zeqiang and Ms. Chong Sze Pui Joanne.

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