Minshang Creative Technology : DISCLOSEABLE TRANSACTION EXTENSION OF SHAREHOLDER'S LOAN TO A COMMONLY HELD ENTITY

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Minshang Creative Technology Holdings Limited

民商創科控股有限公司

(incorporated in the Cayman Islands with limited liability)

(Stock Code: 1632)

DISCLOSEABLE TRANSACTION

EXTENSION OF SHAREHOLDER'S LOAN

TO A COMMONLY HELD ENTITY

2ND SUPPLEMENTAL SHAREHOLDER'S LOAN AGREEMENT

The Board hereby announces that after trading hours on 14 May 2021, MSEC HK entered into the 2nd Supplemental Shareholder's Loan Agreement with Minshang Zhihui, pursuant to which MSEC HK and Minshang Zhihui agreed to extend the term of the Shareholder's Loan from the period commencing from the relevant Drawdown Date and ending on the 24th month from the date thereon to a period commencing from the relevant Drawdown Date and ending on the 48th month from the date thereon. Save as aforesaid, all other terms of the Shareholder's Loan Agreement (as supplemented and amended by the Supplemental Shareholder's Loan Agreement) shall remain in full force and effect.

LISTING RULES IMPLICATIONS

As one or more of the applicable percentage ratios (as defined under Rule 14.07 of the Listing Rules) in respect of the Extension of the Shareholder's Loan is more than 5% but all of them are less than 25%, the Extension of the Shareholder's Loan constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules and is therefore subject to reporting and announcement requirements under Chapter 14 of the Listing Rules.

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Reference is made to the announcement of Minshang Creative Technology Holdings Limited (the "Company") dated 31 December 2018 and the circular (the "Circular") of the Company dated 25 March 2019 in relation to, among other matters, the provision of the shareholder's loan

by MSEC Investment (HK) Limited ("MSEC HK"), an indirect wholly-owned subsidiary of the Company, to Beijing Minshang Zhihui E-commerce Co., Ltd.* (北京民商智惠電子商務有限公

司) ("Minshang Zhihui"), a company in which the Company indirectly owns 50% of its equity interest. Unless the context requires otherwise, capitalised terms used in this announcement shall have the same meanings as those defined in the Circular.

SHAREHOLDER'S LOAN AGREEMENT AND SUPPLEMENTAL SHAREHOLDER'S LOAN AGREEMENT

On 31 December 2018, MSEC HK entered into the Shareholder's Loan Agreement with Minshang Zhihui (as supplemented and amended by the Supplemental Shareholder's Loan Agreement dated 20 March 2019 entered into between the same parties), pursuant to which MSEC HK as lender conditionally agreed to grant Minshang Zhihui as borrower the unsecured shareholder's loan in an aggregate amount of HK$22,500,000 at an interest rate of 8% per annum for a term of 24 months from each of the Drawdown Date. Given that only the conditions precedent to the drawdown of the First Loan had been fulfilled, an aggregate principal amount of HK$15,000,000 was eventually drawn down by Minshang Zhihui and remains outstanding as at the date of this announcement (the "Shareholder's Loan").

On 31 December 2018, Minsheng E-Commerce Holdings (Shenzhen) Co., Ltd. (民生電商控

股(深圳)有限公司) ("Minsheng E-commerce"), a controlling shareholder of the Company indirectly holding 556,190,182 Shares, representing approximately 64.75% of the total issued share capital of the Company as at the date of this announcement, entered into a shareholder's loan agreement (as supplemented and amended by a supplemental shareholder's loan agreement dated 20 March 2019) (the "ME Shareholder's Loan Agreement") with Minshang Zhihui, pursuant to which Minsheng E-commerce agreed to provide a shareholder's loan in an aggregate amount equivalent to HK$22,500,000 to Minshang Zhihui with identical terms of loan, conditions and interest rates as those set out in the Shareholder's Loan Agreement. As at the date of this announcement, an aggregate principal amount of HK$15,000,000 was eventually drawn down by Minshang Zhihui under the ME Shareholder's Loan Agreement from Minsheng E-commerce and remains outstanding (the "ME Shareholder's Loan").

2ND SUPPLEMENTAL SHAREHOLDER'S LOAN AGREEMENT

The Board hereby announces that after trading hours on 14 May 2021, MSEC HK entered into the second supplemental shareholder's loan agreement (the "2nd Supplemental Shareholder's Loan Agreement") with Minshang Zhihui, pursuant to which MSEC HK and Minshang Zhihui agreed to extend the term of the Shareholder's Loan from the period commencing from the relevant Drawdown Date and ending on the 24th month from the date thereon to a period commencing from the relevant Drawdown Date and ending on the 48th month from the date thereon (i.e. 15 May 2023) (the "Extension of Shareholder's Loan").

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Save as aforesaid, all other terms of the Shareholder's Loan Agreement (as supplemented and amended by the Supplemental Shareholder's Loan Agreement) shall remain in full force and effect.

On 14 May 2021, Minsheng E-commerce entered into the second supplemental shareholder's loan agreement with Minshang Zhihui to amend and supplement the terms of the ME Shareholder's Loan Agreement, pursuant to which Minsheng E-commerce agreed to extend the term of the ME Shareholder's Loan to a period commencing from the relevant drawdown date and ending on the 48th month from the date thereon (i.e. 15 May 2023).

REASONS FOR AND BENEFITS OF EXTENSION OF SHAREHOLDER'S LOAN

The terms of the 2nd Supplemental Shareholder's Loan Agreement were arrived at after arm's length negotiations between MSEC HK and Minshang Zhihui. Taking into account that (i) the Company is optimistic about the future prospect of Minshang Zhihui; (ii) the Company is interested in 50% equity interest in Minshang Zhihui and the Extension of the Shareholder's Loan will enable Minshang Zhihui and its subsidiaries to maintain and stabilise its current cash position to support its business operation and future growth; (iii) the ensuing interest income of 8% per annum from the Extension of the Shareholder's Loan is higher than the existing bank deposit interest rate of the Group; and (iv) Minsheng E-commerce agreed to extend the term of the ME Shareholder's Loan to such length of period identical to the extended term as contemplated under the 2nd Supplemental Shareholder's Loan Agreement, whereby the Company's contribution in the Shareholders' Loan to Minshang Zhihui remains in proportion to its equity interests in Minshang Zhihui in the ratio of 50%: 50%, the Directors (including the independent non-executive Directors but excluding Mr. Wu Jiangtao (吳江濤) ("Mr. Wu") and Mr. Lu Sheng Hong (蘆勝 紅) ("Mr. Lu"), being the executive Directors, who abstained from voting on the resolutions proposed to the Board in relation to the Extension of the Shareholder's Loan for the reasons as disclosed in the section headed "Listing Rules Implications" below) consider that the terms of the 2nd Supplemental Shareholder's Loan Agreement are on normal commercial terms or better to the Group and the Extension of the Shareholder's Loan is fair and reasonable and is in the interests of the Group and the Shareholders as a whole.

INFORMATION ON THE GROUP AND MSEC HK

The Group is principally engaged in (i) the operation of restaurant chains under the "Viet's Choice" (越棧) brands and "Five Spice (5越)" brands in Hong Kong; and (ii) trading business. MSEC HK is an investment holding company which is holding 50% equity interests in Minshang Zhihui.

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INFORMATION ON MINSHANG ZHIHUI

Minshang Zhihui is a sino-foreign equity joint venture established in the PRC with limited liability which is principally engaged in technology and e-commerce related business with a focus on its scenario marketing system and supply chain management capability to provide various banks, financial institutions and sizable corporations with e-commerce service.

As at the date of this announcement, Minshang Zhihui is owned (i) as to 50% by MSEC HK,

1. as to 15% by Minsheng E-commerce; (iii) as to 30% by Beijing Dandeliang Consulting Management Center (Limited Partnership)* (北京丹德利昂諮詢管理中心(有限合夥)) (the "Limited Partnership"); and (iv) as to 5% by Super Fine Development Limited (超輝發展 有限公司) ("Super Fine") which is an Independent Third Party and is principally engaged in investment holding.

As at the date of this announcement, Minsheng E-commerce has 13 shareholders which are PRC

established corporations and organisations. The single largest shareholder, Minsheng Royal Asset Management Co., Ltd. (民生加銀資產管理有限公司), a company which is principally engaged

in asset management and an indirect subsidiary of China Minsheng Banking Corp., Ltd. (中國民 生銀行股份有限公司) (a national joint stock commercial bank whose A shares and H shares are

listed on Shanghai Stock Exchange and the Stock Exchange respectively), holds approximately

24.83% of the equity interests in Minsheng E-commerce. The second largest shareholders, South Hope Industry Co., Ltd.* (南方希望實業有限公司) ("South Hope") and Orient Group Commercial Investment Co., Ltd. (東方集團商業投資有限公司) ("Orient Commercial"), each

holds approximately 18.18% of the equity interests in Minsheng E-commerce, respectively. South Hope is a subsidiary of New Hope Group Co., Ltd. (新希望集團有限公司) ("New Hope

Group") which is mainly engaged in modern agricultural and food production and is in turn owned, among others, as to 75% by New Hope Holdings Group Co., Ltd.* (新希望控股集團有

限公司) ("New Hope Holdings") and as to approximately 14.60% by Mr. Liu Yonghao (劉永 好) ("Mr. Liu"). New Hope Holdings is ultimately owned by Mr. Liu through various companies

directly and indirectly controlled by him. Orient Commercial is wholly owned by Orient Group Incorporation (東方集團股份有限公司), a company listed on the Shanghai Stock Exchange which

is mainly involved in finance, trading, ports, industrial businesses. The third largest shareholder is Shenzhen Minshang Chuangye Investment Center (Limited Partnership)* (深圳民商創業投資 中心(有限合夥)) ("Minshang Chuangye"), a limited partnership established in the PRC which holds approximately 11.29% of equity interests in Minsheng E-commerce. Minshang Chuangye

is owned by, among others, as to 98.4% by Shenzhen Minshang Development Investment Management Co., Ltd.* (深圳民商發展投資管理有限公司) ("Shenzhen Minshang") and as to

0.8% by Mr. Wu. Shenzhen Minshang is owned, among others, as to 76.92% by Mr. Wu. Each of Minshang Chuangye and Shenzhen Minshang is principally engaged in investment holding. The remaining 9 shareholders of Minsheng E-commerce each holds less than 5% shareholding in Minsheng E-commerce.

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As at the date of this announcement, the Limited Partnership is formed by, among others, the

employee(s) of Minshang Zhihui and Minsheng E-commerce and Beijing Dande Consulting Management Co. Ltd.* (北京丹德諮詢管理有限公司), which is owned as to 40% by Mr. Wu, as to 40% by Mr. Liang Di (梁笛) and as to 20% by Cao Yutao (曹玉濤), which is the general

partner of the Limited Partnership and holds approximately 16.66% of the equity interests in the Limited Partnership. The remaining approximately 83.34% of the equity interests in the Limited Partnership are owned by 30 employees of Minshang Zhihui and Minsheng E-commerce, who are all limited partners and some of whom hold indirect equity interests in Minsheng E-commerce. Among the 30 limited partners, each of Mr. Wu, Mr. Tao Jingyuan (陶靜遠 ) ("Mr. Tao") and Ms. Li Jia (李佳) ("Ms. Li") directly holds 16%, 2% and 1.33% of the equity interests in the Limited Partnership respectively while Mr. Wu, Mr. Tao and Ms. Li are all executive Directors.

LISTING RULE IMPLICATIONS

As one or more of the applicable percentage ratios (as defined under Rule 14.07 of the Listing Rules) in respect of the Extension of the Shareholder's Loan is more than 5% but all of them are less than 25%, the Extension of the Shareholder's Loan constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules and is therefore subject to reporting and announcement requirements under Chapter 14 of the Listing Rules.

In addition, Minsheng E-commerce, a controlling shareholder and thus a connected person of the Company, is entitled to exercise or control the exercise of 10% or more of the voting power at any general meeting of Minshang Zhihui. Therefore, Minshang Zhihui is a commonly held entity falling within the meaning of Rule 14A.27 of the Listing Rules. Accordingly, the entering into of the 2nd Supplemental Shareholder's Loan Agreement and the Extension of the Shareholder's Loan will constitute a connected transaction for the Company under Chapter 14A of the Listing Rules. As the provision of the Shareholder's Loan by the Group to the commonly held entity (i.e. Minshang Zhihui) for a term extended by the 2nd Supplemental Shareholder's Loan Agreement is on normal commercial terms or better and in proportion to the equity interests held by the Company (through its subsidiaries) in Minshang Zhihui, the Extension of the Shareholder's Loan will be exempt from the reporting, announcement and independent Shareholders' approval requirements under Chapter 14A of the Listing Rules.

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