Pacific Century Premium Developments : Very Substantial Acquisition - Supplemental Agreement in relation to the Construction of Hotel in Niseko, Hokkaido, Japan

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PACIFIC CENTURY PREMIUM DEVELOPMENTS LIMITED

盈科大衍地產發展有限公司*

(Incorporated in Bermuda with limited liability)

(Stock Code: 00432)

VERY SUBSTANTIAL ACQUISITION

SUPPLEMENTAL AGREEMENT

IN RELATION TO THE CONSTRUCTION OF HOTEL

IN NISEKO, HOKKAIDO, JAPAN

Reference is made to the announcement of the Company dated 20 July 2018 in relation to the Original Construction Contract entered into between the Owner (an indirect wholly-owned subsidiary of the Company) and the Contractor, under which the Owner has engaged the Contractor to design and construct the Hotel.

THE SUPPLEMENTAL AGREEMENT

On 24 December 2019, the Owner and the Contractor have entered into the Supplemental Agreement to supplement and amend certain terms of the Original Construction Contract in relation to the Hotel Construction.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Supplemental Agreement exceeds 100%, the Supplemental Agreement constitutes a very substantial acquisition of the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting, announcement, circular and the Shareholders' approval requirements under Chapter 14 of the Listing Rules.

The SGM of the Company will be convened for the Shareholders to consider and, if thought fit, to approve, among other matters, the Supplemental Agreement and the transactions contemplated thereunder. For the purpose of the approval to be sought from the Shareholders, the transaction amount to be approved under the Supplemental Agreement will be JPY24,797,640,000 (equivalent to approximately HK$1,766,087,921), being the Adjusted Contract Sum for the Hotel and its related facilities plus a 5% buffer of the Adjusted Contract Sum for the Hotel and its related facilities for the adjustments for variation works and other Contractor's claims for the settlement of final accounts as mentioned in the sub-section headed "The Supplemental Agreement - Adjusted Contract Sum for the Hotel and its related facilities" in this announcement. To the best of the knowledge, information and belief of the Directors having made all reasonable enquiries, no Shareholder is required to abstain from voting on the resolution(s) to be proposed at

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the SGM in respect of the Supplemental Agreement and the transactions contemplated thereunder.

A circular containing, among other things, (i) further details of the Supplemental Agreement; (ii) the notice convening the SGM; and (iii) any other information as required to be disclosed under the Listing Rules, will be despatched to the Shareholders by the Company. As it is expected that additional time will be required to prepare the relevant information to be included in the circular, the Company expects that the circular will be despatched to the Shareholders on or before 4 March 2020.

Reference is made to the announcement of the Company dated 20 July 2018 in relation to the Original Construction Contract entered into between the Owner (an indirect wholly-owned subsidiary of the Company) and the Contractor, under which the Owner has engaged the Contractor to design and construct the Hotel on the land owned by the Group in Niseko, Hokkaido, Japan.

THE SUPPLEMENTAL AGREEMENT

On 24 December 2019, the Owner and the Contractor have entered into the Supplemental Agreement to supplement and amend certain terms of the Original Construction Contract. A summary of key amendments made in relation to the Hotel and its related facilities under the Supplemental Agreement is as follows:

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Pursuant to the terms of the Original Construction Contract, the Adjusted Contract Sum for the Hotel and its related facilities is subject to further adjustments to cover variation works and other claims before the final accounts are settled.

Condition : The Supplemental Agreement is conditional upon the passing of a resolution as required pursuant to the Listing Rules at the duly convened SGM approving the Supplemental Agreement.

Save as disclosed, all other key terms under the Original Construction Contract shall remain unchanged and shall continue to be in full force and effect.

REASONS FOR AND BENEFITS OF THE SUPPLEMENTAL AGREEMENT

With respect to the Hotel and its related facilities (which are ancillary to the Hotel's operations) for which the Owner has engaged the Contractor to design and construct, the corresponding total gross floor area designated for the Hotel and its ancillary operations has increased from 23,339 square meters to 29,650 square meters. The Adjusted Contract Sum for the Hotel and its related facilities takes into account additional costs for design changes and upgrading works which were not anticipated at the time when the parties entered into the Original Construction Contract and the costs for the Hotel's related or ancillary facilites. Such design changes and upgrading works are needed in order to meet the premium standards and operational needs of the Hotel. It is the Company's vision to position the Hotel as an iconic hotel development in the region, so as to facilitate future developments of the entire site of around 2.7 million square meters at Niseko Hanazono, Hokkaido, Japan. The Hotel, being an iconic hotel development, has already attracted public attention by having the Japan Tourism Agency to hold the G20 Tourism Ministers' Meeting at the function village of the Hotel on 25 and 26 October 2019.

The Board considers that the Supplemental Agreement is on normal commercial terms, the terms thereof are fair and reasonable and that such transaction is in the interests of the Company and the Shareholders as a whole.

LISTING RULES IMPLICATIONS

As one of the applicable percentage ratios calculated pursuant to Rule 14.07 of the Listing Rules in respect of the Supplemental Agreement exceeds 100%, the Supplemental Agreement constitutes a very substantial acquisition of the Company under Chapter 14 of the Listing Rules and is therefore subject to the reporting, announcement, circular and the Shareholders' approval requirements under Chapter 14 of the Listing Rules.

The SGM of the Company will be convened for the Shareholders to consider and, if thought fit, to approve, among other matters, the Supplemental Agreement and the transactions contemplated thereunder. For the purpose of the approval to be sought from the Shareholders, the transaction amount to be approved under the Supplemental Agreement will be JPY24,797,640,000 (equivalent to approximately HK$1,766,087,921), being the Adjusted Contract Sum for the Hotel and its related facilities plus a 5% buffer of the Adjusted Contract Sum for the Hotel and its related facilities for the adjustments for variation works and other Contractor's claims for the settlement of final accounts as mentioned in the sub-section headed "The Supplemental Agreement - Adjusted Contract Sum for the Hotel and its related facilities" in this announcement. To the best of the knowledge, information and belief of the Directors having made all reasonable enquiries, no

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Hong Kong, 24 December 2019

Unless indicated otherwise, in this announcement, translation of amounts in JPY into HK$ have been made at the rate of HK$0.07122 = JPY1 respectively for illustration purpose only. No representation is made that any amount in HK$ could have been or could be converted at such respective rates or at all.

As at the date of this announcement, the Directors of the Company are as follows:

Executive Directors:

Li Tzar Kai, Richard; Benjamin Lam Yu Yee (Deputy Chairman and Group Managing Director); James Chan; and Hui Hon Hing, Susanna

Non-Executive Directors:

Lee Chi Hong, Robert (Non-Executive Chairman); and Dr Allan Zeman, GBM, GBS, JP

Independent Non-Executive Directors:

Prof Wong Yue Chim, Richard, SBS, JP; Chiang Yun; and Dr Vince Feng

* For identification only

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