Annual Report 2021

085 Report of the Directors Miramar Hotel and Investment Company, Limited Annual Report 2021 (2) On 4 July 2019, Profit Advantage Limited, a wholly-owned subsidiary of the Company as tenant entered into a sub-lease with IFC Development Limited as landlord for a short term of two months (from 7 July 2019 to 6 September 2019) (the “Short Term Sub-Lease”) as the parties were unable to reach consensus on the rent for a further term of three years following the expiry of the three-year sub-lease in respect of the ifc Premises (as defined below) on 6 July 2019. On 4 December 2019, the parties have reached consensus on the rent for a longer sub-lease and the parties together with MTR Corporation Limited (“MTRC”) (being the lessor of the head lease dated 16 September 2003 entered into between MTRC as lessor and IFC Development Limited as lessee in respect of the ifc Premises) entered into a sub-lease (the “New Sub-Lease”) for a further term of two years and ten months (from 7 September 2019 to 6 July 2022). The Short Term Sub-Lease was a de minimis transaction for the Company under Chapter 14A of the Listing Rules. Details of the terms and conditions are set out as follows: Premises : Shop Nos. 3101–3107 on Level Three of ifc Mall (the “ifc Premises”). Term : Two months from 7 July 2019 to 6 September 2019 (both days inclusive) in respect of the Short Term Sub-Lease and two years and ten months from 7 September 2019 to 6 July 2022 (both days inclusive) in respect of the New Sub-Lease. Rent : A basic rent (the “Basic Rent”) payable on a monthly basis during the Short Term Sub-Lease is HK$1,117,970.00 per calendar month and during the New Sub-Lease is HK$1,038,115.00 per calendar month for the first six months and HK$1,117,970.00 per calendar month for the seventh to thirty-fourth months (all exclusive of rates, air-conditioning and management charges, promotional levy, utility and other charges and all other outgoings (if any)), plus the additional rent calculated as the excess of 11% of the gross amount of all sums billed or received in the course of the tenant’s business conducted at the ifc Premises and all other income deriving from or in respect of the ifc Premises excluding 10% service charges (the “Gross Receipts”) against the Basic Rent under the Short Term Sub- Lease or the New Sub-Lease (as the case may be) (the “Turnover Rent”) per calendar month. Payment term : The Basic Rent shall be payable in advance by the tenant to the landlord on the first day of each calendar month. The Turnover Rent (if applicable) shall be payable by the tenant to the landlord on the fifteenth day of the following month. Rental deposit : A rental deposit in the sum of HK$4,967,630.40 (equivalent to the aggregate of the highest pre-determined Basic Rent, air-conditioning and management charges, government rates (or, if applicable, provisional rates) and promotional levy currently payable in respect of the ifc Premises for three months) is payable by the tenant to the landlord and subject to the terms of the New Sub-Lease, and is refundable to the tenant without interest within forty-five days after the expiry or sooner determination of the New Sub-Lease and delivery of vacant possession of the ifc Premises.