Annual Report 2020

084 Report of the Directors Annual Report 2020 Miramar Hotel and Investment Company, Limited Other charges : The aggregate of air-conditioning and management charges and promotional levy payable by the tenant in advance on the first day of each calendar month in respect of the New Sub-Lease shall be HK$491,906.80 per month (subject to revision from time to time). Option to renew sub-lease : Subject to the New Sub-Lease, the tenant has an option to renew the New Sub-Lease for a further term of three years from the expiry of the New Sub-Lease on 6 July 2022 (the “Initial Term”) by giving the landlord prior written notice not earlier than seven months but not later than six months before the expiry of the Initial Term and provided that the monthly basic rent for the renewed term shall be further agreed between the parties which shall not be less than HK$1,117,970.00 per calendar month. The parties to the New Sub- Lease will enter into a renewal sub-lease upon the tenant exercising the renewal option. Break clause : If the average of the Gross Receipts of the tenant for any 12 consecutive calendar months is less than HK$500.00 per square foot per calendar month (i.e. approximately HK$7,985,500.00 per calendar month based on approximately 15,971 square feet lettable area), the landlord shall have the right to terminate the New Sub- Lease by giving not less than 90 days’ written notice to the tenant. As the landlord is an associate of Henderson Land Development Company Limited (“Henderson Land”), which in turn is a substantial shareholder of the Company, the landlord is a connected person of the Company under the Listing Rules. Therefore, the entering into of the Short Term Sub-Lease and the New Sub-Lease constituted a one-off connected transaction and a continuing connected transactions for the Company under Chapter 14A of the Listing Rules. (3) On 5 December 2013, a lease (the “Mira Moon Lease Agreement”) was entered into between Intelligent House Limited as landlord (the “Landlord”) and Mira Moon Limited, a wholly-owned subsidiary of the Company, as tenant (the “Tenant”), whereby the tenant had agreed to lease from the landlord the premises upon the terms as detailed below: Premises : the Premises, being the remaining portion of section A of Marine Lot No. 436 together with a building now known as “MIRA MOON” located at No. 388 Jaffe Road, Wanchai, Hong Kong. Term : 10 years and 6 months, commencing from 21 November 2013 to 20 May 2024 (both days inclusive). Termination by sale and redevelopment : If, at any time during the Term, the Landlord shall resolve to (i) sell the Premises or any part of it; (ii) assign any of its rights and interests in the Premises or any part of it to any third party(ies); or (iii) re- develop the Premises or any part of it by demolition, rebuilding, renovation, refurbishment or otherwise, the Landlord shall have the right upon giving 6 months written notice to the Tenant to terminate the Mira Moon Lease Agreement; provided that such notice of termination shall not be given by the Landlord to the Tenant on or before the expiry date of the 5th year of the Term (i.e. on or before 30 June 2018).