About CHINA ART FIN Company

We are a leading art finance service provider in China, with two business divisions providing art finance services: (i) art and asset pawnbrokers; and (ii) art and asset auctions. Art investment and art financing are two major business areas in the art finance market. We are mainly engaged in art pawn loan business (an important art financing channel in China) and art auctions (a well-known art investment channel in China). We are headquartered in Yixing City, Jiangsu Province, which is the sole producer of zisha clay, the main raw material for making zisha art. Yixing is famous for producing zisha works of art, and is also home to a number of zisha art masters. competitive advantage We are convinced that the following competitive advantages will secure our leading position in the art finance market and help our business grow sustainably in the near future. We have a strong market leading position in the art finance industry, and are pioneering in the art pawn loan and online auction markets We are a leading art finance service provider in China, mainly providing art pawn loans and art auction services. In January 2013, we were certified as an AA auction company by the China Auction Industry Association. We are convinced that our well-known brand name and leading market position have aroused public interest and confidence in our services and established a good reputation in the industry, which not only enhances customer loyalty to our services, but also helps enhance our ability to collect more high-quality works of art, thereby attracting more potential bidders to participate in our art auctions. We are located in Yixing, Jiangsu, and enjoy the geographical advantage of developing art-related businesses We are headquartered in Yixing, Jiangsu, China. Jiangsu Province is one of the most economically developed provinces in China. Yixing City is famous for Zisha art, and is also a gathering place for several famous Zisha artists and calligraphy and painting masters. We have established good and stable relationships with art enthusiasts (including artists, agents, art masters, experts, art dealers, collectors, and art galleries and private museums), some of whom are located in Jiangsu or Yixing. They provide art as pawns to obtain our art pawn loans, and commission auctions or purchase high-value works of art at our art auctions. We have established a long-term market base in Yixing City and have established good relationships with local art enthusiasts. Coupled with relatively adequate supply from neighboring regions, it has greatly enhanced our ability to solicit high-value zisha art and other works of art, which helps attract potential buyers to participate in our art auctions. Furthermore, due to the relatively localized nature of the pawn loan industry, through years of operation, we have accumulated deep local knowledge and established close cooperative relationships with existing and target customers in the region. Locking in high-quality works of art as pawn loans and for art auctions will reduce our business risk and improve profitability. Our art pawn loans and art auction business bring us synergetic benefits We have been developing our business in the art finance industry since 2010. We are one of the few companies in China capable of establishing a comprehensive business model. Through this model, we provide customers with art as a platform for trading and financing. We provide the ability to provide comprehensive art services, so that our brand can penetrate the art market deeply, concentrate resources to develop high-quality services related to art, and thus make the art business successful. This business model and the synergistic benefits of these two divisions complementing each other have provided us with (among others) the following benefits: We have set up a professional assessment and evaluation team. Professional ability and expertise in art appraisal and evaluation is one of the most important elements in the art pawn loan and art auction business. After years of operation, some art enthusiasts are joint customers of our two business divisions. They are borrowers of our pawn loans and sellers and/or buyers of our art auctions. Our art storage facility for loan pawns and for art auctions is located at our headquarters and managed by us. We have put in place specific measures for storing, preserving, and removing works of art from the warehouse. The synergy brought about by our ability to provide comprehensive art finance services increases operational efficiency, reduces overall operating costs, and allows us to benefit from economies of scale. We have established an effective risk management and internal control system We have been establishing, maintaining and continuously improving internal control and risk management systems for our pawn loans and auctions business. As far as the art and asset pawnbroking business is concerned, we have adopted and implemented a comprehensive set of specific measures, including every stage from receipt of loan application to loan repayment. In particular, we have adopted prudent art compromise ratios to reduce risk exposure. As far as our art and asset auction business is concerned, we also adopt a number of steps for screening, authenticating and evaluating auctions. We believe that our risk management and internal control systems are effective and efficient in reducing the risks involved in our business, so we maintain a low level of loan impairment. We have an experienced and stable management team, led by visionary founders Our management team consists of experienced industry experts, who have led our rapid development into a leading art finance service provider in China in recent years. Our Chairman and Executive Director Fan Zhijun worked at a domestic bank before founding the Group, during which time he accumulated over 15 years of practical experience in accounting, loan financing and risk management. Mr. Fan Zhijun was born into an artistic family. His uncle, Mr. Fan Baowen, is a master of Chinese landscape painting. This has enabled Mr. Fan Zhijun to accumulate many years of interest and knowledge in the appraisal and evaluation of Chinese art. Furthermore, the cross-industry experience and expertise of management team members can complement each other's strengths and create maximum synergy benefits for our two business divisions. Due to the nature of our art-related business, we have also established long-term relationships with external experts to appraise and evaluate works of art. Our senior management and experts work together to contribute to our development and growth as a professional art pawn loan service provider and art auction house in China.