CHEVALIER PACIFIC HOLDINGS LIMITED * (Incorporated in Bermuda with limited liability) (Stock code: 508)

Transcription

1 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. CHEVALIER PACIFIC HOLDINGS LIMITED * (Incorporated in Bermuda with limited liability) (Stock code: 508) CONTINUING CONNECTED TRANSACTIONS This announcement is made pursuant to Rule 14A.41 of the Listing Rules. As a result of the completion of the Asset Reorganisation which took place on 28 September 2011, each of the World Pointer Group Companies became a 51%-owned subsidiary of CPHL, with the remaining 49% equity thereof being held by CL Holdings, an indirect subsidiary of CIHL. Accordingly, CL Holdings became a connected person of CPHL under the Listing Rules and the transactions contemplated under the Management Agreements, which are pre-existing contracts, become continuing connected transactions for CPHL under Chapter 14A of the Listing Rules after the completion of the Asset Reorganisation. Pursuant to Rule 14A.41 of the Listing Rules, CPHL is required to comply with the reporting, annual review and disclosure requirements of Chapter 14A of the Listing Rules for the continuing connected transactions contemplated under the Management Agreements after the completion of the Asset Reroganisation. Details of the Management Agreements were disclosed in the joint announcement of CPHL and CIHL dated 17 December 2010 and the circular of CPHL dated 25 February 2011, and are summarised below. INTRODUCTION Reference is made to the (i) joint announcement of CPHL and CIHL dated 17 December 2010 and the circular of CPHL dated 25 February 2011 in relation to, among other things, the Management Agreements; and (ii) the joint announcement of CIHL, CPHL and Wincon Capital Investment Limited dated 12 July 2011 in relation to, among other things, the Asset Reorganisation and the Share Sale. On 21 December 2010, each of the World Pointer Group Companies entered into the Management Agreements with Cafe Deco to appoint Cafe Deco as its sole agent to manage and operate the restaurants and bars and kiosks owned by the World Pointer Group Companies. The Management Agreements were initially entered into among subsidiaries within the CPHL Group. As a result of the completion of the Asset Reorganisation and the Share Sale which took place on 28 September 2011, CIHL ceased to hold any shareholding interest in CPHL; and each of the World Pointer Group Companies became a 51%-owned subsidiary of CPHL, with the remaining 49% equity thereof being held by CL Holdings, an indirect subsidiary of CIHL. Accordingly, CL Holdings became a connected person of CPHL under the Listing Rules and the transactions contemplated under the Management Agreements, which are pre-existing contracts, become continuing connected transactions for CPHL under Chapter 14A of the Listing Rules after the completion of the Asset Reorganisation. Pursuant to Rule 14A.41 of the Listing Rules, CPHL is required to comply with the reporting, annual review and disclosure requirements of Chapter 14A of the Listing Rules for the continuing connected transactions. This announcement is made pursuant to Rule 14A.41 of the Listing Rules. 1

2 THE MANAGEMENT AGREEMENTS Details of the Management Agreements, which have been disclosed in the joint announcement of CPHL and CIHL dated 17 December 2010 and the circular of CPHL dated 25 February 2011, are summarised below: Date 21 December 2010 Parties (i) Cafe Deco; and (ii) each of the World Pointer Group Companies. Cafe Deco is principally engaged in investment holdings in food and beverages companies and provision of management services. Mr. CHOW Vee Tsung, Oscar and Mr. CHANG Wan Lung, Robert (both executive Directors) are also directors of Cafe Deco. Save as aforesaid, to the best of the Directors knowledge, information and belief having made all reasonable enquiry, save for being the holding company of CL Holdings which in turn holds a 49% interest in each of the World Pointer Group Companies, Cafe Deco and its ultimate beneficial owners are otherwise third parties independent of CPHL and its connected persons. Subject matter Each of the World Pointer Group Companies entered into the Management Agreements with Cafe Deco to appoint Cafe Deco as its sole agent to manage and operate the nine restaurants and bars and three kiosks owned by the World Pointer Group Companies for a period commencing from 21 December 2010 to 15 February Under the terms of the Management Agreements, Cafe Deco provides certain back-office support services to the restaurants and bars and kiosks under the World Pointer Group Companies such as maintaining books of account, maintenance of premises of restaurants and bars, and repairs and decorations of the restaurants. Under the Management Agreements, Cafe Deco shall have the following obligations and authorities: providing general administrative and management services, including negotiating and executing contracts in the ordinary course of business, setting prices and rates schedules, and collecting incomes, ensuring the restaurants and bars and kiosks operate and render services efficiently and properly, and establishing regulations and reviewing management policies in connection therewith; recruiting, supervising and training staff of all levels of the restaurants and bars and kiosks; negotiating and executing leases and tenancy agreements and all other documents in relation to the use of premises of restaurants and bars and kiosks; maintaining the premises, furniture and equipment in proper operating conditions; maintaining corporate relationship with clients, including planning and executing public relation, promotions and membership programs; and implementing World Pointer Group Companies accounting, budgeting, marketing, personnel and operational policies and practices relating to or affecting the restaurants and bars and kiosks operations and the preparation of the accounts. 2

3 Management Fee and Incentive Fee Under the Management Agreements, Cafe Deco shall be entitled to the Management Fee equivalent to 6% of the monthly gross sale arising from the operations of the restaurants under the World Pointer Group Companies, payable in arrears within 10 business days from the end of the relevant month. In addition, Cafe Deco shall also be entitled to the Incentive Fee up to 7% of the monthly gross sale arising from the operations of the restaurants under the World Pointer Group Companies if such companies have a positive EBITDA, payable in arrears within seven days from the end of the relevant month. The Incentive Fee shall be calculated in the following manner: (i) if the EBITDA over the monthly gross sales (the EBITDA Margin ) after deduction of the Management Fee is less than 7%, Cafe Deco shall be entitled to receive an Incentive Fee equivalent to the EBITDA less the Management Fee; or (ii) if the EBITDA Margin after deduction of the Management Fee is 7% or more, the Incentive Fee shall be equivalent to 7% of the monthly gross sales. Under the terms of the Management Agreements, the World Pointer Group Companies are only subject to the payment of the Management Fee and Incentive Fee to Cafe Deco as described above and there is no other compensation or fee payable to Cafe Deco. Cafe Deco shall be responsible to have the World Pointer Group Companies maintaining sufficient cash flow for their operations. In the event the EBITDA of the World Pointer Group Companies is less than zero, Cafe Deco shall make up such shortfall on a dollar-to-dollar basis. The Management Fee and the Incentive Fee were determined after arm s length negotiations between Cafe Deco and the World Pointer Group Companies with reference to industry practices. GENERAL The CPHL Group is principally engaged in food and beverages business in Hong Kong. The Directors consider that it is a common industry practice to engage a management company to operate the restaurants for the owners of the restaurants. The Management Agreements were entered into as part of the merger of the food and beverages business of the then CPHL Group and that of the group companies of Metro Point Enterprise Company Limited (a 60%-owned subsidiary of Sharp Rise) in December The Directors (including the independent non-executive Directors) consider that the transactions contemplated under the Management Agreements are fair and reasonable and in the interest of CPHL and its shareholders as a whole. COMPLIANCE WITH LISTING RULES The Management Agreements were originally entered into among the subsidiaries within the CPHL Group. As a result of the completion of the Share Sale and the Asset Reorganisation, CIHL ceased to hold any shareholding interests in CPHL; and CL Holdings became a connected person of CPHL under the Listing Rules. Accordingly, the transactions contemplated under the Management Agreements, which are pre-existing contracts, become continuing connected transactions for CPHL under Chapter 14A of the Listing Rules and are subject to the reporting, annual review and disclosures requirements under Rule 14A.41 of the Listing Rules. Upon any variation or renewal of the Management Agreements, CPHL shall comply in full with all applicable reporting, annual review, disclosure and independent shareholders approval requirements under Chapter 14A in due course. 3

4 DEFINITIONS Asset Reroganisation Cafe Deco CIHL CL Holdings connected person(s) CPHL CPHL Group Directors EBITDA Hong Kong Incentive Fee Listing Rules Management Agreements Management Fee Share Sale the reorganisation of the assets of the CPHL Group involving the disposal of the entire issued share capital of Sharp Rise to CIHL pursuant to an agreement dated 17 June 2011, which was completed on 28 September 2011 Cafe Deco Holdings Limited (formerly known as Sinochina Enterprises Limited), a company incorporated in the British Virgin Islands with limited liability which is owned as to 60% by Sharp Rise and as to 40% by International Restaurants Holdings Limited Chevalier International Holdings Limited, a company incorporated in Bermuda with limited liability whose issued shares are listed on the Main Board of the Stock Exchange (stock code: 25) CL Holdings Limited, a company incorporated in Hong Kong with limited liability which is a wholly-owned subsidiary of Cafe Deco has the meaning ascribed in the Listing Rules Chevalier Pacific Holdings Limited, a company incorporated in Bermuda with limited liability whose issued shares are listed on the Main Board of the Stock Exchange (stock code: 508) CPHL and its subsidiaries directors of CPHL earnings before interest, tax, depreciation and amortisation Hong Kong Special Administrative Region of the People s Republic of China the incentive fee payable by the World Pointer Group Companies to Cafe Deco pursuant to the terms of the Management Agreements The Rules Governing the Listing of Securities on the Stock Exchange the management agreements all dated 21 December 2010 entered into by Cafe Deco and each of the World Pointer Group Companies respectively for the appointment of Cafe Deco as the sole agent to manage and operate the restaurants and bars and kiosks owned by the World Pointer Group Companies the monthly management fee payable by the World Pointer Group Companies to Cafe Deco under the terms of the Management Agreements the sale by CIHL of its controlling shareholding interest in CPHL to Wincon Capital Investment Limited pursuant to a sale and purchase agreement dated 17 June 2011, which was completed on 28 September

5 Sharp Rise Stock Exchange World Pointer World Pointer Group Companies Sharp Rise Limited, a company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of CIHL after completion of the Asset Reorganisation The Stock Exchange of Hong Kong Limited World Pointer Limited, a company incorporated in the British Virgin Islands with limited liability and a wholly-owned subsidiary of CPHL Giant Ocean (H.K.) Limited, Grand Concept (Hong Kong) Limited and Eastech Limited, all being 51%-owned subsidiaries of World Pointer % per cent. By order of the board of directors Chevalier Pacific Holdings Limited CHOW Yei Ching Chairman Hong Kong, 28 September 2011 * For identification purpose only As at the date of this announcement, the board of Directors comprises Dr. CHOW Yei Ching (Chairman), Mr. CHOW Vee Tsung, Oscar (Managing Director), Mr. KUOK Hoi Sang, Miss Lily CHOW and Mr. CHANG Wan Lung, Robert as executive Directors; and Mr. WU King Cheong, Mr. LEUNG Kwong Kin and Mr. LAU Kai Shu, Frank as independent non-executive Directors. All the Directors jointly and severally accept full responsibility for the accuracy of the information contained in this announcement, and confirm, having made all reasonable enquiries, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading. 5