G Vision International : CONTINUING CONNECTED TRANSACTION RENEWAL OF LEASE OF PROPERTY

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, 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 announcement.

G-Vision International (Holdings) Limited

環科國際集團有限公司*

(Incorporated in Bermuda with limited liability)

(Stock Code: 657)

CONTINUING CONNECTED TRANSACTION

RENEWAL OF LEASE OF PROPERTY

On 4 May 2020, CCC Restaurant and Homley entered into the 2020 Tenancy Deed pursuant to which CCC Restaurant leased from Homley the Property for a period of one year commencing from 1 May 2020 as disclosed in the announcement of the Company dated 4 May 2020. The 2020 Tenancy Deed expired on 30 April 2021.

The Directors announce that on 30 April 2021 (after trading hours), CCC Restaurant and Homley entered into the Tenancy Deed pursuant to which CCC Restaurant will lease from Homley the Property for a period of one year commencing from 1 May 2021 to 30 April 2022 (both dates inclusive) at a monthly rental of HK$240,000 from 1 May 2021 to 31 October 2021 and a monthly rental of HK$360,000 from 1 November 2021 to 30 April 2022 (exclusive of rates and management and air-conditioning fees).

Homley is a wholly-owned subsidiary of Golden Toy. Golden Toy and Kong Fai hold approximately 8.88% and 65.62% of the issued share capital of the Company, respectively. The entire issued share capital of each of Golden Toy and Kong Fai is beneficially owned by two discretionary trusts, the objects of which include members of the Cheng Family. As all members of the Cheng Family are executive Directors, Homley, being a wholly-owned subsidiary of Golden Toy, is an associate of such persons and is therefore a connected person of the Company under the Listing Rules. Accordingly, the Transaction constitutes a continuing connected transaction of the Company under the Listing Rules.

As the term of the lease of the Property under the Tenancy Deed is 12 months from the commencement date and such lease does not contain any purchase option, the Group applies the short-term lease recognition exemption under the Hong Kong Financial Reporting Standard 16 issued by the Hong Kong Institute of Certified Public Accountants (HKFRS

1. to such lease. Accordingly, the Group will recognise the lease payments under the Tenancy Deed as expenses on a straight-line basis over the lease term, instead of recognising the right-of-use asset at the commencement date of the lease.

As each of the relevant percentage ratios for the Transaction is, on an annual basis, less than 25% and the aggregate annual rental is less than HK$10,000,000, the Transaction is subject to the reporting, announcement and annual review requirements, but is exempt from the

- 1 -

circular and independent shareholders' approval requirements under Chapter 14A of the Listing Rules.

The Directors (excluding Mr. Cheng Hop Fai, Ms. Cheng Pak Ming, Judy, Ms. Cheng Pak Man, Anita and Ms. Cheng Pak Lai, Lily but including the independent non-executive Directors) consider that the Transaction is in the ordinary and usual course of business of the Group, and that the terms of the Tenancy Deed have been negotiated on an arm's length basis and on normal commercial terms that are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

1. BACKGROUND
   On 4 May 2020, CCC Restaurant and Homley entered into the 2020 Tenancy Deed pursuant to which CCC Restaurant leased from Homley the Property for a period of one year commencing from 1 May 2020 at a monthly rental of HK$360,000 (exclusive of rates and management and air-conditioning fees) and with a single rent free period for one month from 1 May 2020 to 31 May 2020 (both dates inclusive), as disclosed in the announcement of the Company dated 4 May 2020. As the 2020 Tenancy Deed expired on 30 April 2021, CCC Restaurant and Homley entered into the Tenancy Deed on 30 April 2021 (after trading hours), pursuant to which CCC Restaurant will lease from Homley the Property for a period of one year commencing from 1 May 2021 to 30 April 2022 (both dates inclusive) at a monthly rental of HK$240,000 from 1 May 2021 to 31 October 2021 and a monthly rental of HK$360,000 from 1 November 2021 to 30 April 2022 (exclusive of rates and management and air-conditioning fees).
2. THE TENANCY DEED DATED 30 APRIL 2021 Parties:
3. 1. Homley as the landlord
   2. CCC Restaurant as the tenant

Principal Terms of the Tenancy Deed:

On 30 April 2021 (after trading hours), CCC Restaurant and Homley entered into the Tenancy Deed pursuant to which CCC Restaurant will lease from Homley the Property for a term of one year commencing from 1 May 2021 to 30 April 2022 (both dates inclusive) at a monthly rental of HK$240,000 from 1 May 2021 to 31 October 2021 and a monthly rental of HK$360,000 from 1 November 2021 to 30 April 2022 (exclusive of rates and management and air-conditioning fees). The rental in respect of the Property shall be payable monthly in advance on the 1st day of each month and shall be financed from the internal resources of the Group. There is no provision in the Tenancy Deed that allows the variation of the monthly rental during the term of the tenancy. Upon signing of the Tenancy Deed, CCC Restaurant shall pay to Homley a sum of HK$1,080,000 as rental deposit and security for the due observance and performance by CCC Restaurant of its obligations under the

- 2 -

Tenancy Deed. The rental deposit of HK$1,080,000 shall be returned to CCC Restaurant within 30 days after the expiration or early termination of the Tenancy Deed.

The aggregate annual rental in respect of the Property under the Tenancy Deed amounts to HK$3,600,000 (comprising the rental of HK$240,000 for each of the months from 1 May 2021 to 31 October 2021 and the rental of HK$360,000 for each of the months from 1 November 2021 to 30 April 2022). The maximum aggregate annual value of the transactions contemplated under the 2020 Tenancy Deed and the Tenancy Deed for the two financial years ending 31 March 2022 and 31 March 2023 amounts to HK$3,600,000 (comprising the rental of HK$360,000 for April 2021, the rental of HK$240,000 for each the months from 1 May 2021 to 31 October 2021 and the rental of HK$360,000 for each of the months from 1 November 2021 to 31 March 2022) and HK$360,000, respectively.

The rental under the Tenancy Deed was negotiated on an arm's length basis and on normal commercial terms between CCC Restaurant and Homley and was determined with reference to the prevailing market rentals of other comparable premises.

1. REASONS FOR THE TENANCY DEED
2. 
   The Group principally engages in the operation of a chain of Chinese restaurants in Hong Kong that specializes in Chiu Chow cuisine. The Property is currently used by the Group to operate one of its restaurants.
   The principal business of CCC Restaurant is to operate the restaurant located at the Property.
   The principal business of Homley is property investment.
   CCC Restaurant entered into the 2020 Tenancy Deed with Homley on 4 May 2020 with respect to the lease of the Property for a term of one year commencing from 1 May 2020. The 2020 Tenancy Deed expired on 30 April 2021. As CCC Restaurant will continue its restaurant operation at the Property, CCC Restaurant has requested and Homley has agreed to a renewal of the lease of the Property and entered into the Tenancy Deed on 30 April 2021 (after trading hours).
3. CONTINUING CONNECTED TRANSACTION
4. 
   As at the date of this announcement, Homley is a wholly-owned subsidiary of Golden Toy. Golden Toy and Kong Fai hold approximately 8.88% and 65.62% of the issued share capital of the Company, respectively. The entire issued share capital of each of Golden Toy and Kong Fai is beneficially owned by two discretionary trusts, the objects of which include members of the Cheng Family. As all members of the Cheng Family are executive Directors, Homley, being a wholly-owned subsidiary of Golden Toy, is an associate of such persons and is therefore a connected person of the Company under the Listing Rules. Accordingly, the Transaction constitutes a continuing connected transaction of the Company under the Listing Rules.

   • 3 -

As the term of the lease of the Property under the Tenancy Deed is 12 months from the commencement date and such lease does not contain any purchase option, the Group applies the short-term lease recognition exemption under the Hong Kong Financial Reporting Standard 16 issued by the Hong Kong Institute of Certified Public Accountants (HKFRS 16) to such lease. Accordingly, the Group will recognise the lease payments under the Tenancy Deed as expenses on a straight-line basis over the lease term, instead of recognising the right-of-use asset at the commencement date of the lease.

As each of the relevant percentage ratios for the Transaction is, on an annual basis, less than 25% and the aggregate annual rental is less than HK$10,000,000, the Transaction is subject to the reporting, announcement and annual review requirements, but is exempt from the circular and independent shareholders' approval requirements under Chapter 14A of the Listing Rules.

The Directors (including the independent non-executive Directors) consider that the Transaction is in the ordinary and usual course of business of the Group, and that the terms of the Tenancy Deed have been negotiated on an arm's length basis and on normal commercial terms that are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

As the executive Directors, namely Mr. Cheng Hop Fai, Ms. Cheng Pak Ming, Judy, Ms. Cheng Pak Man, Anita and Ms. Cheng Pak Lai, Lily, have material interests in the Transaction, each of them has abstained from voting on the relevant resolutions of the Board approving the Tenancy Deed and the Transaction. Save as disclosed above, none of the Directors has a material interest in the Transaction or is required to abstain from voting on the relevant resolutions of the Board. Save as disclosed above, none of the other Directors has any material interests in the Transaction.

The Company will disclose information in relation to the Tenancy Deed in its subsequently published annual report and accounts in accordance with the relevant requirements as set out in Rule 14A.71 of the Listing Rules.

5. TERMS USED IN THIS ANNOUNCEMENT

Hong Kong, 30 April 2021

As at the date of this announcement, the Board comprises Mr. Cheng Hop Fai (Chairman and Managing Director), Ms. Cheng Pak Ming, Judy, Ms. Cheng Pak Man, Anita and Ms. Cheng Pak Lai, Lily as executive Directors and Mr. Leung Tai Chiu, Mr. Law Toe Ming and Mr. Hung Chi Yuen, Andrew as independent non-executive Directors.

* for identification purpose only

- 6 -