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.

LUYE PHARMA GROUP LTD. 綠 葉 製 藥 集 團 有 限 公 司 (Incorporated in Bermuda with limited liability) (Stock Code: 02186)

DISCLOSEABLE TRANSACTION THIRD PARTIES’ INVESTMENTS IN BOAN

Reference is made to the announcement of the Company dated 28 December 2020 in relation to the Group A Investors’ agreements to subscribe for equity interests in Shandong Boan (an indirect subsidiary of the Company). On 4 January 2021, the Company, Shandong Boan, the Original Boan Shareholders and the Group B Investors entered into the Group B Subscription Agreements in relation to further investments in Shandong Boan.

SUBSCRIPTION AGREEMENTS

Shandong Boan (an indirect subsidiary of the Company), the Original Boan Shareholders, the Company and the Investors (comprising the Group A Investors and the Group B Investors) entered into the Subscription Agreements, pursuant to which, among other things, Shandong Boan conditionally agreed to issue and the Investors conditionally agreed to subscribe for equity interest representing in aggregate 12.32% of the enlarged registered capital of Shandong Boan following Completion for an aggregate capital contribution of RMB681,781,600 in cash.

Upon Completion, the registered capital of Shandong Boan will be increased from RMB407,560,000 to RMB464,852,146.20 and held as to approximately 77.44% by Shandong Luye, an indirect wholly- owned subsidiary of the Company, 10.23% by the Boan ESOP Entities, and 12.32% in aggregate by the Investors. Shandong Boan will continue to be a subsidiary of the Company and the financial results of the Shandong Boan will continue to be accounted for and consolidated into the financial results of the Group.

The Subscription Agreements contain certain rights in favour of the Investors. For further details, please refer to the section headed ‘‘The Group B Subscription Agreements — Other Rights’’ below in this announcement.

– 1 – LISTING RULES IMPLICATIONS

The Subscription

As the percentage of shareholding of Shandong Luye in Shandong Boan will be reduced from 88.33% (prior to the Subscription) to 77.44% after Completion, the Subscription will constitute a deemed disposal of equity interest in Shandong Boan under Rule 14.29 of the Listing Rules. As the highest applicable percentage ratio (as defined under Rule 14.07 of the Listing Rules) in respect of the Group B Subscription (after aggregating the amounts in respect of the Group A Subscription) is more than 5% but less than 25%, the Group B Subscription constitutes a discloseable transaction of the Company under the Listing Rules and is subject to the reporting and announcement requirements, but exempt from the circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

THE REPURCHASE OPTION

Under the Subscription Agreements, the Investors were granted the Repurchase Option, which entitles the Investors to request the Original Boan Shareholders to repurchase the Investors’ equity interests in Shandong Boan under certain circumstances. The right to exercise the Repurchase Option is vested with the Investors. The Repurchase Option will be treated as if exercised at the time of its grant pursuant to Rule 14.74(1) of the Listing Rules. Based on the maximum repurchase amount payable by the Group in the event that the Repurchase Option is exercised, the highest applicable percentage ratio (as defined under Rule 14.07 of the Listing Rules) in respect of the Repurchase Option under the Group B Subscription Agreements (after aggregating the maximum repurchase amount payable by the Group in the event that the Repurchase Option is exercised under the Group A Subscription Agreements) is more than 5% but less than 25%. Therefore, the grant of the Repurchase Option constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements, but exempt from the circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

No Director is considered to have a material interest in the Subscription Agreements and none of themwasrequiredtoabstainfromvotingontheresolutions in relation to the Subscription Agreements proposed to the Board.

Reference is made to the announcement of the Company dated 28 December 2020 in relation to the Group A Investors’ agreements to subscribe for equity interest in Shandong Boan (an indirect subsidiary of the Company). On 4 January 2021, the Company, Shandong Boan, the Original Boan Shareholders and the Group B Investors entered into the Group B Subscription Agreements in relation to further investments in Shandong Boan. The principal terms of the Group B Subscription Agreements are summarised as follows.

– 2 – THE GROUP B SUBSCRIPTION AGREEMENTS

Date

4 January 2021

Parties

1. Shandong Boan, an indirect subsidiary of the Company;

2. Shandong Luye, an indirect wholly owned subsidiary of the Company;

3. the Company;

4. the Boan ESOP Entities; and

5. the Group B Investors.

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

Subject matter

Pursuant to the Group B Subscription Agreements, among other things, Shandong Boan conditionally agreed to issue and the Group B Investors conditionally agreed to subscribe for equity interests representing 9.79% of the enlarged registered capital of Shandong Boan following Completion (assuming that no other equity of Shandong Boan will be issued prior to Completion), for a total capital contribution of RMB541,781,600.00 in cash (equivalent to RMB11.90 per RMB of registered capital of Shandong Boan), comprising:

Group B Investors Capital Contribution Amount (RMB)

Investor 2 40,000,000 Investor 4 150,000,000 Investor 5 70,000,000 Investor 6 65,256,000 Investor 7 60,000,000 Investor 8 50,000,000 Investor 9 30,000,000 Investor 10 30,000,000 Investor 11 20,000,000 Investor 12 10,000,000 Investor 13 10,000,000 Investor 14 6,525,600

– 3 – Under the Group A Subscription Agreements and the Group B Subscription Agreements, the Investors conditionally agreed to subscribe for equity interests representing in aggregate 12.32% of the enlarged registered capital of Shandong Boan following Completion for an aggregate capital contribution of RMB681,781,600 in cash.

The capital contribution amount was arrived at after arm’s length negotiations between Shandong Boan and the Group B Investors with reference to, among other things, the R&D capabilities of the Shandong Boan Group, its product pipelines and their market potentials, and the general landscape of the biotech industry in . The Group A Subscription and the Group B Subscription are essentially on the same terms and the Investors’ capital contributions amounts were determined based on the same valuation of Shandong Boan.

The equity holding structure of Shandong Boan as at the date of this announcement and immediately after Completion are as follows:

As at the date of this announcement Immediately after Completion Registered Approx. % of Registered Approx. % of Shareholders capital shareholding capital shareholding (RMB’000) (RMB’000)

Shandong Luye 360,000.00 88.33 360,000.00 77.44 Boan ESOP Entities 47,560.00 11.67 47,560.00 10.23 Group A Investors Investor 1 8,403.30 1.81 Investor 2 (Note) 5,882.31 1.27 Investor 3 840.33 0.18 Group B Investors Investor 4 12,604.95 2.71 Investor 5 5,882.31 1.27 Investor 6 5,483.66 1.18 Investor 7 5,041.98 1.08 Investor 8 4,201.65 0.90 Investor 9 2,520.99 0.54 Investor 10 2,520.99 0.54 Investor 11 1,680.66 0.36 Investor 12 840.33 0.18 Investor 13 840.33 0.18 Investor 14 548.37 0.12

Total 407,560.00 100.00 464,852.15 100.00

Note: Investor 2 agreed to subscribe (i) for RMB2,520,989.69 registered capital under its Group A Subscription Agreement and (ii) for RMB3,361,319.60 registered capital under its Group B Subscription Agreement.

– 4 – Completion and conditions precedent

Completion of the Group B Subscription is subject to the satisfaction of certain conditions, which include among others the following:

(a) Shandong Boan having obtained the internal approvalsinrelationtotheGroupBSubscription from its board of directors and shareholders; and

(b) completion of the Group B Subscription not being prohibited or restricted by any law, regulation or any proceeding of any governmental authority.

It is expected that completion of the Group A Subscription and the Group B Subscription will occur simultaneously.

PaymentoftheCapitalContribution

The Group B Investors shall pay Shandong Boan their committed capital contribution amount in full within 10 days following Shandong Boan confirming that all conditions have been satisfied.

Other rights

The Group A Subscription Agreements and the Group B Subscription Agreements contain provisions which provide certain rights to the Investors, a summary of such key provisions is set out as follows:

No preferential price to third party investors

Subject to other provisions in the Subscription Agreements, if Shandong Boan issues additional equity at a price lower than the price at which the Investors pay for the equity interest in Shandong Boan, the Investors shall have the right to request an increase of their shareholding proportions in Shandong Boan to match the lower price per share, at no additional cost on part of the Investors.

Repurchase Option

If any of the following events occurs, the Investors shall have the right to require Shandong Luye to purchase all of the equity interests of Shandong Boan held by the Investors:

(a) Shandong Boan fails to realise a Qualified Listing by 31 December 2024;

(b) the occurrence of any material integrity issue in relation to the Original Boan Shareholders or any of the Shandong Boan directors (other than director(s) nominated by an Investor), senior management of an Original Boan Shareholder, or if there is any off-the-books cash sales proceeds at Shandong Boan that were not known to the Investors, or material internal control weaknesses caused by intentional or gross negligence on the part of the Original Boan Shareholders or the management of Shandong Boan that prevented Shandong Boan from achieving a Qualified Listing;

– 5 – (c) Shandong Boan is unable to publish its audited reports (audited by an auditor possessing securities and futures qualifications) with an unqualified opinion, preventing Shandong Boan from achieving a Qualified Listing; or

(d) the Group has not received the approval in connection with the proposed spin-off of Shandong Boan from the Group within the timeframe set out in the Subscription Agreements.

The repurchase price shall be determined based on an agreed internal rate of return on the capital contribution amounts or the fair value of the net assets of Shandong Boan then prevailing after certain adjustments, but will in any case be subject to a maximum cap of an amount equal to three times the respective Investor’s total capital contribution amount under the Subscription.

The Company agrees to guarantee the repurchase obligations of Shandong Luye.

Preferential distribution rights

The Investors shall rank ahead of the Original Boan Shareholders in terms of dividend payments and distribution upon liquidation.

Most favourable terms

After Completion, if Shandong Boan raises any capital (whether by way of equity or convertible debt) in subsequent financing on terms and conditions which are more favourable than those under the Subscription, the Investors shall be entitled to such more favourable terms and the terms of the Subscription shall be adjusted to reflect such most favourable terms.

The Company will further comply with the applicable requirements under the Listing Rules in the event that the exercise of any rights as disclosed above would trigger an obligation under the Listing Rules.

Restrictions on transfer

The Subscription Agreements contain provisions which restrict the Investors and the Original Boan Shareholders from transferring their equity interest in Shandong Boan, which are summarised as follows:

(1) Except as otherwise provided for in the Subscription Agreements, the Original Shareholders may not transfer, pledge their Shandong Boan equity interests to a third party without the consent of all Investors.

(2) Without the consent of Shandong Luye, the Investors shall not perform the following acts of disposing of Shandong Boan equity interests:

(i) transfer or otherwise dispose of Shandong Boan equity to a competitor or potential competitor of Shandong Boan;

(ii) pledge or create third party rights to its Shandong Boan shareholding; or

– 6 – (iii) transfer its equity interest in Shandong Boan to entities that do not qualify as investors under the applicable regulatory requirements.

(3) Subject to (2) above and (4) below, if an Investor intends to transfer its equity interests in Shandong Boan to a third party other than an entity controlled by the Investor (or the Investor’s actual controllers), the Original Boan Shareholders shall have a right of first refusal to acquire the equity interests on the same terms offered to the third party.

(4) An Investor may transfer its equity interest in Shandong Boan to an entity controlled by the Investor (or the Investor’s actual controllers) without being subject to the right of first refusal of the Original Boan Shareholders, provided that the interest to be transferred to each single transferee is not less than 20% of the equity interest in Shandong Boan acquired by the relevant Investor in the Subscription.

REASONS AND BENEFITS FOR THE SUBSCRIPTION AND THE REPURCHASE OPTION

The Subscription

The proceeds from the Subscription will be used as supplemental working capital for the principal business of Shandong Boan. The capital from the Subscription can also alleviate the financial pressure brought by the business development of Shandong Boan, which enhances Shandong Boan’s ability to withstand risks and maintain market competitiveness, and promotes the long-term stable development of Shandong Boan. Besides, the introduction of strategic investors is expected to create synergies on the development of Shandong Boan and Shandong Boan’s ability to strive for a leading position in the industry. In light of the business development, capital demand and future capital market planning of Shandong Boan, the Directors are of the view that the Subscription is in the interest of the Company and its shareholders as a whole.

The Repurchase Option

Pursuant to the Subscription Agreements, the Group is subject to repurchase obligations. After Completion, Shandong Boan will continue to be a subsidiary of the Company and the Group will continue to control and lead the development of Shandong Boan. The Investors will provide support for the future development of Shandong Boan, and assist Shandong Boan in developments in the capital markets, which is expected to generate greater return for the Group in the future.

Considering: (i) the maximum repurchase price (which would not exceed three times the Total Capital Contribution); and (ii) the benefits of the Subscription and the Investors brought to Shandong Boan as outlined above, the Directors are of the view that the risk associated with the Repurchase Option is within the Group’s capacity and such risk is fair and reasonable in light of the potential benefits and the future development opportunities.

Having considered the above, the Directors (including the independent non-executive Directors) consider that while the Subscription Agreements and the transactions contemplated thereunder (including the Subscription and the Repurchase Option) were not part of the ordinary and usual course

– 7 – of business of the Group, they were on normal commercial terms and entered into after arm’s length negotiations, and that the terms of the Subscription Agreements and the transactions contemplated thereunder (including the Subscription and the Repurchase Option) are fair and reasonable and in the interests of the Company and the Shareholders as a whole.

INFORMATION OF SHANDONG BOAN

Background

Shandong Boan is a fully integrated biopharmaceutical company established in 2013. It specialises in therapeutic antibody development with a focus on oncology, immunology, pain and endocrine diseases. Over the past several years, Shandong Boan has developed expertise in antibody production, lead optimisation, cell line establishment, process development, technology transfer, pilot production and commercial production. Shandong Boan’s antibody discovery activities are organised around four platforms, namely Human Antibody Transgenic Mouse and Phage Display Technology, Bispecific T cell Engager Technology, ADC Technology and Nanobody Platform. It covers the whole process of target verification, antibody discovery and development, CMC. Independent and coherent research and development capabilities ensure the high quality of antibodies, high development speed and low supplier dependence. Shandong Boan has developed more than 10 innovative antibody products with international intellectual property protection and eight biosimilar products. For biosimilar products, Biologic License Application (BLA) has been made for LY01008 (biosimilar to Avastin) in China; LY06006 (biosimilar to Prolia) is under phase III clinical trial in China and phase I clinical trial in Europe as well as the United States; LY09004 (biosimilar to Eylea) and LY01011 (biosimilar to Xgeva) are under phase III clinical trial in China. In addition, one of the innovative antibody products is under phase I clinical trial in China.

In addition, Shandong Boan also has CAR-T Technology. Shandong Boan’s CAR-T product is focusing on late stage solid tumors and will be manufactured by non-lenti platform. Boan continues to develop cutting edge technologies including novel off-the-shelf CAR-T, regulatable CAR-T, to make safer and affordable products for patients.

Financial Information

The book value of Shandong Boan as at 31 December 2019 was approximately RMB476.54 million, which represented its net liabilities as at that date. For the financial years ended 31 December 2018 and 2019, Shandong Boan recorded net loss of RMB176.43 million and RMB113.40 million both before and after tax and extraordinary items, respectively, according to its financial statements prepared under the accounting principles generally accepted in the PRC. Upon Completion, Shandong Boan will continue to be regarded as a subsidiary of the Company and the financial results of the Shandong Boan will continue to be accounted for and consolidated into the financial results of the Group.

– 8 – INFORMATION OF THE GROUP

The Group is an international pharmaceutical group dedicated to the research and development (R&D), manufacturing and sale of innovative medications. The Group has established R&D centers in China, the U.S. and Europe, with a robust pipeline of over 30 drug candidates in China and more than 10 drug candidates in other international markets. Along with a number of new drugs and new formulations in the central nervous system and oncology therapeutic areas under study in the U.S., Europe and Japan, the Group has reached high-level international standards in novel drug delivery technologies including microspheres, liposomes, and transdermal drug delivery systems, as well as actively making strategic developments in the fields of biological antibodies, cell therapies and gene therapies, among others. The Group is developing a global supply chain of 8 manufacturing sites with over 30 production lines in total, establishing GMP quality management and international standard control systems. With more than 30 products covering the central nervous system, oncology, cardiovascular, metabolism and other therapeutic areas, business of the Group is conducted in over 80 countries and regions around the world, including the largest pharmaceutical markets — China, the U.S., Europe and Japan, as well as in fast growing emerging markets.

INFORMATION OF THE ORIGINAL BOAN SHAREHOLDERS

Shandong Luye is an indirect wholly owned subsidiary of the Company and is principally engaged in development, production and sales of pharmaceutical products and management of the Group’splantsin Laishan and Yantai Industrial Park.

Each of the Boan ESOP Entities is a limited partnership established in the PRC for the purpose of future potential employee incentive scheme(s) in relation to Shandong Boan.

INFORMATION OF THE INVESTORS

Investor 1

蘇州工業園區新建元三期創業投資企業(有限合夥) SIP Sungent BioVenture Venture Capital Investment Partnership III (LP) is a limited partnership established under the laws of the PRC in Industrial Park, Jiangsu Province of the PRC, and is managed by SIP Yuanfu Venture Capital Investment Management Partnership (LP) (蘇州工業園區元福創業投資管理企業(有限合夥), which assets include companies in the innovative medicine, medical technology, diagnostic and health service industries.

Investor 2

深圳市柏奧瑞思投資合夥企業(有限合夥) ( BioResearch Investment Fund Limited Partnership) is an investment fund established in Shenzhen, the PRC, and is managed by Shenzhen Blue Ocean Investment Fund Management Co. Ltd 深圳藍海創業投資基金管理有限公司, which focuses on venture capital and private equity investment in innovative biotech companies and has accumulated US$300 million assets under management with dual currency funds.

– 9 – Investor 3

煙台創科新動能投資中心(有限合夥) Yantai Innovative Technology New Kinetic Energy Capital Center (Limited Partnership)is a limited partnership established under the laws of the PRC in Yantai High-tech Zone, Shandong Province of the PRC, whose general partner and manager is Yantai Caijin Investment Holdings Co. (煙台市財金投資控股有限公司) Yantai Innovative Technology New Kinetic Energy Capital Center (Limited Partnership) is an investment institution focusing on supporting technology innovation enterprises in the fields of medical and health care, high-end equipment, semiconductors, new energy and new materials.

Investor 4

Advantech Capital Investment XIV Limited is a company incorporated in the British Virgin Islands. It is a wholly-owned subsidiary of Advantech Capital II Master Investment Limited, a private equity fund launched by Mr. Jianming Yu (于劍鳴) in January 2016 and which focuses on innovation-driven growth capital in China, on investments in Healthcare, TMT, and E-services sectors.

Investor 5 and Investor 9

前海股權投資基金(有限合夥) Qianhai Equity Fund LLP is a limited partnership established in Shenzhen Qianhai Shenzhen-Hong Kong Cooperation Zone. It was established in January 2016, and is the largest commercially raised mother fund in China and the largest single fund in China. It is also the largest single commercial venture capital and private equity fund in China, with a current fund management scale of RMB28.5 billion.

中原前海股權投資基金(有限合夥) Zhongyuan Qianhai Equity Fund LLP is a limited partnership established in Zhengdong New District, City, Henan Province.

Both funds are managed by 前海方舟資產管理有限公司 Qianhai Ark Asset Management Co., which manages several investment platforms, covering three of the PRC’s most active economic zones, namely the Greater Bay Area, the Yangtze River Delta and the Yellow and Bohai Sea Rim.

Investor 6 and Investor 14

Serendipity Investment (Hongkong) Limited, a company incorporated under the laws of Hong Kong, is a wholly-owned subsidiary of Reunion Pharma, which is in turn a wholly-owned subsidiary of BVCF IV, L.P., which is managed by BVCF Management Limited, which is in turn directly owned by Dr. YANG Zhi (楊志).

Asian Alliance (Hongkong) Limited is a company incorporated under the laws of Hong Kong, and is a wholly-owned subsidiary of Asia Pharma. Asia Pharma is a wholly-owned subsidiary of BVCF Co- investor A,L.P., which is managed by BVCF Management Limited, which is in turn directly owned by Dr. YANG Zhi (楊志).

– 10 – BVCF Management Limited manages funds that focus on international growth stage life sciences companies.

Investor 7 and Investor 10

青島博睿愛美投資合夥企業(有限合夥) Brill Aimei Investment Partnership (Limited Partnership) is a limited partnership established in City.

寧波梅山保稅港區博睿羅伊股權投資合夥企業(有限合夥) Meishan Free Trade Port District Brill Luoyi Equity Investment Partnership (Limited Partnership) is a limited partnership established in Ningbo Free Trade Port District, the PRC.

Both Investor 5 and Investor 8 are funds owned by Brill Capital (博睿資本). Brill Capital is a RMB private equity fund that invests mainly in medical and pharmaceutical, high-tech, TMT and consumer sectors.

Investor 8

煙台市藍海創業投資有限公司 Yantai Blue Ocean Venture Capital Co., Ltd. is a company registered in Yantai, the PRC in December 2011, is a wholly-owned subsidiary of Yantai Zhengda City Construction and Development Co. (煙台市正大城市建設發展有限公司) Yantai Blue Ocean Venture Capital Co., Ltd. is an investment institution focusing on venture capital investment and management.

Investor 11

深圳前海維陽投資中心(有限合夥) Shenzhen Qianhai Weiyang Investment Center (Limited Partnership) is a limited partnership established in Shenzhen Qianhai Shenzhen Cooperation Zone of the PRC in January 2016, which is funded by Zhuang Qingbin (莊清彬) and Ma Cankai (馬燦楷). Ma Cankai (馬燦楷) manages the investment and acts as the managing partner. Shenzhen Qianhai Weiyang Investment Center invests mainly in bio-medicine, New materials and high-end manufacturing sectors.

Investor 12

南京瑞源投資管理合夥企業(有限合夥) Ruiyuan Investment Management Partnership (Limited Partnership) is a limited partnership established in October 2020 by four individual partners, namely Yang Jie (楊潔), Xiong Shoujun (熊守軍), Cha Jing (查晶) and Wei Yanqiong (衛彥瓊). The four partners have been working in the pharmaceutical industry for nearly 30 years with extensive experiences in the pharmaceutical and health industry as well as the pharmaceutical industry chain.

Investor 13

深圳興銳投資中心(有限合夥) Shenzhen Xingrui Investment Center (Limited Partnership) is a limited partnership established in January 2019 and managed by Rong Hui Street Asset Management (Shenzhen) Co., Ltd. (融匯街資產管理(深圳)有限公司). Shenzhen Xingrui Investment Center invests mainly in high-tech, new energy, medical and healthcare sectors.

– 11 – LISTING RULES IMPLICATIONS

The Subscription

As the percentage of shareholding of Shandong Luye in Shandong Boan will be reduced from 88.33% to 77.44% after the Completion, the Subscription will constitute a deemed disposal of equity interest in Shandong Boan under Rule 14.29 of the Listing Rules.

As the highest applicable percentage ratio (as defined under Rule 14.07 of the Listing Rules) in respect of the Group B Subscription (after aggregating the amounts in respect of the Group A Subscription) is more than 5% but less than 25%, the Group B Subscription Agreement and the Subscription constitutes a discloseable transaction of the Company under the Listing Rules and is subject to the reporting and announcement requirements, but exempt from the circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

The Repurchase Option

The exercise right of the Repurchase Option is vested with the Investors. The Repurchase Option will be treated as if exercised at the time of its grant pursuant to Rule 14.74(1) of the Listing Rules. Based on the maximum repurchase amount payable by the Group in the event that the Repurchase Option is exercised, the highest applicable percentage ratio (as defined under Rule 14.07 of the Listing Rules) in respect of the Repurchase Option under the Group B Subscription Agreement (after aggregating the maximum repurchase amount payable by the Group in the event that the Repurchase Option is exercised under the Group A Subscription Agreement) is more than 5% but less than 25%. Therefore, the grant of the Repurchase Option constitutes a discloseable transaction for the Company and is subject to the reporting and announcement requirements, but exempt from the circular and Shareholders’ approval requirements under Chapter 14 of the Listing Rules.

No Director is considered to have a material interest in the Subscription Agreements and none of them was required to be abstained from voting on the resolutions in relation to the Subscription Agreements proposed to the Board.

As the Completion is subject to the fulfillment of a number of conditions precedent set out in the Share Subscription Agreements, the Subscription may or may not proceed.

– 12 – DEFINITIONS

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

‘‘Boan ESOP Entities’’ 煙台博發投資中心(有限合夥) (Yantai Bofa Investment Centre Limited Partnership), 煙台博晟投資中心(有限合夥) (Yantai Bosheng Investment Centre Limited Partnership) and 煙台博聯投資中心(有限合 夥) (Yantai Bolian Investment Centre Limited Partnership), each a limited partnership established under the laws of the PRC

‘‘Board’’ the board of directors of the Company

‘‘Company’’ Luye Pharma Group Ltd., a company incorporated in Bermuda with limited liability, the shares of which are listed on the Main Board of the Stock Exchange

‘‘Completion’’ completion of the Subscription in accordance with the Subscription Agreements

‘‘Directors’’ the directors of the Company

‘‘Group’’ the Company and its subsidiaries, from time to time

‘‘Group A Investors’’ Investor 1, Investor 2 and Investor 3

‘‘Group A Subscription’’ the subscription of equity interest in Shandong Boan by the Group A Investors pursuant to the Group A Subscription Agreements

‘‘Group A Subscription the agreements entered into among the Company, the Original Boan Agreements’’ Shareholders and the Group A Investors in relation to the Group A Subscriptions

‘‘Group B Investors’’ Investor 2, Investor 4, Investor 5, Investor 6, Investor 7, Investor 8, Investor 9, Investor 10, Investor 11, Investor 12, Investor 13 and Investor 14

‘‘Group B Subscriptions’’ the subscription of equity interest in Shandong Boan by the Group B Investors pursuant to the Group B Subscription Agreements

‘‘Group B Subscription the agreements entered into among the Company, the Original Boan Agreements’’ Shareholders and the Group B Investors in relation to the Group B Subscriptions

‘‘Hong Kong’’ the Hong Kong Special Administrative Region of the People’s Republic of China

– 13 – ‘‘Investor 1’’ 蘇州工業園區新建元三期創業投資企業(有限合夥) (SIP Sungent BioVenture Venture Capital Investment Partnership III (LP))

‘‘Investor 2’’ 深圳市柏奧瑞思投資合夥企業(有限合夥) (Shenzhen BioResearch Investment Fund Limited Partnership))

‘‘Investor 3’’ 煙台創科新動能投資中心(有限合夥) (Yantai Innovative Technology New Kinetic Energy Capital Center (Limited Partnership))

‘‘Investor 4’’ Advantech Capital Investment XIV Limited

‘‘Investor 5’’ 前海股權投資基金(有限合夥) (Qianhai Equity Fund LLP)

‘‘Investor 6’’ Serendipity Investment (Hongkong) Limited

‘‘Investor 7’’ 青島博睿愛美投資合夥企業(有限合夥) (Qingdao Brill Aimei Investment Partnership (Limited Partnership))

‘‘Investor 8’’ 煙台市藍海創業投資有限公司 (Yantai Blue Ocean Venture Capital Co., Ltd.)

‘‘Investor 9’’ 中原前海股權投資基金(有限合夥) (Zhongyuan Qianhai Equity Fund LLP)

‘‘Investor 10’’ 寧波梅山保稅港區博睿羅伊股權投資合夥企業(有限合夥) (Ningbo Meishan Free Trade Port District Brill Luoyi Equity Investment Partnership(LimitedPartnership))

‘‘Investor 11’’ 深圳前海維陽投資中心(有限合夥) (Shenzhen Qianhai Weiyang Investment Center (Limited Partnership))

‘‘Investor 12’’ 南京瑞源投資管理合夥企業(有限合夥) (Nanjing Ruiyuan Investment Management Partnership (Limited Partnership))

‘‘Investor 13’’ 深圳興銳投資中心(有限合夥) (Shenzhen Xingrui Investment Center (Limited Partnership))

‘‘Investor 14’’ Asian Alliance (Hongkong) Limited

‘‘Investors’’ collectively, the Group A Investors and the Group B Investors

‘‘Listing Rules’’ the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited

‘‘Original Boan Shandong Luye and the Boan ESOP Entities Shareholders’’

– 14 – ‘‘PRC’’ the People’s Republic of China, and for the purpose of this announcement, excludes Hong Kong, the Macau Special Administrative Region of the People’s Republic of China and Taiwan

‘‘Qualified Listing’’ the initial public offering of the equity securities of Shandong Boan on an approved stock exchange (including Stock Exchange, Shenzhen Stock Exchange, the Stock Exchange or other stock exchanges recognised by Investors)

‘‘Repurchase Option’’ the rights of the Investors to require the Original Boan Shareholders to repurchase the equity interest in Shandong Boan held by the Investors pursuant to the Subscription Agreements

‘‘RMB’’ Renminbi, the lawful currency of the PRC

‘‘Shandong Boan’’ 山東博安生物技術有限公司 (Shandong Boan Biological Technology Co. Ltd.), a company with limited liability established in the PRC, and a subsidiary of the Company

‘‘Shandong Luye’’ 山東綠葉製藥有限公司 (Shandong Luye Pharmaceutical Co. Ltd.), a company with limited liability established in the PRC, and a wholly- owned subsidiary of the Company

‘‘Stock Exchange’’ The Stock Exchange of Hong Kong Limited

‘‘Shareholders’’ the shareholders of the Company

‘‘Subscription’’ the subscription by the Investors of equity interests in Shandong Boan pursuant to the Subscription Agreements

‘‘Subscription Agreements’’ collectively, the Group A Subscription Agreements and the Group B Subscription Agreements

‘‘Total Capital Contribution’’ the aggregate capital contribution of RMB681,781,600 in cash by all the Investors to Shandong Boan pursuant to the Subscription Agreements

‘‘%’’ per cent

– 15 – In this announcement, the terms ‘‘associate’’, ‘‘connected person’’, ‘‘controlling shareholder’’, ‘‘percentage ratios’’ and ‘‘‘subsidiary’’ have the meanings given to such terms in the Listing Rules, unless the context otherwise requires.

English translations for the Chinese names of the PRC entities, authorities or facilities in this announcement are for reference only. In the event of any discrepancies between the Chinese names of these PRC entities, authorities or facilities and their respective English translations, the Chinese version shall prevail.

By Order of the Board LUYE PHARMA GROUP LTD. LiuDianBo Chairman

Hong Kong, 4 January 2021

As at the date of this announcement, the executive Directors of the Company are Mr. LIU Dian Bo, Mr. YANG Rong Bing, Mr. YUAN Hui Xian and Ms. ZHU Yuan Yuan; the non-executive Director of the Company is Mr. SONG Rui Lin; and the independent non-executive Directors of the Company are Mr. ZHANG Hua Qiao, Professor LO Yuk Lam, Mr. LEUNG Man Kit and Mr. CHOY Sze Chung Jojo.

– 16 –