Common use of REASONS FOR THE TRANSACTIONS Clause in Contracts

REASONS FOR THE TRANSACTIONS. The Service Agreements are renewal of the existing service agreements and were entered into by Hysan Group in the ordinary course of its businesses of leasing and property management. The entering into of the Service Agreements is in line with Hysan Group’s policy of centralizing the leasing activities, lease administration and property management of its portfolio. The Directors (including Independent Non-Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactions) are of the view that the transactions contemplated under the Service Agreements are on normal commercial terms, in the ordinary and usual course of business of Hysan Group after due negotiations and on arm’s length basis with reference to the prevailing market conditions, the terms of the Service Agreements are fair and reasonable and in the interests of the Company and its shareholders as a whole. The Directors (including Independent Non- Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactions) also believe that the Annual Caps for the Service Agreements are fair and reasonable. REGULATORY ASPECTS Barrowgate is a non-wholly owned subsidiary of the Company and a connected person of the Company under the Listing Rules by virtue of Jebsen & Co. holding 10% issued shares in Barrowgate. Jebsen & Co. is an associate of Xx. Xxxxxx, a Non-Executive Director of the Company and therefore a connected person of Hysan at the listed issuer level. HLCL and HPML are wholly-owned subsidiaries of the Company. Accordingly, the Service Agreements and transactions contemplated thereunder constitute continuing connected transactions for the Company under Rule 14A.31 of the Listing Rules. Due to the interest of an associate of Xx. Xxxxxx in the Service Agreements, Xx. Xxxxxx abstained from voting on the relevant resolutions for approving the Service Agreements in the meeting of the Board. Given that certain applicable percentage ratios in respect of the Annual Caps for the Service Agreements on an annual aggregated basis are more than 0.1% and less than 5%, the Service Agreements fall under Rule 14A.76(2) of the Listing Rules and are only subject to the announcement, reporting and annual review requirements but exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. Particulars of the Service Agreements will be disclosed in the relevant annual reports and accounts of Hysan in accordance with Rule 14A.71 of the Listing Rules.

REASONS FOR THE TRANSACTIONS. The Service Agreements are renewal principal business activities of the existing service agreements Group are the production and/or distribution of bottled, canned and were draught beers and other beverage products. Most of the products of the Group are marketed under various brand names owned by the San Xxxxxx Group, including those under the Neptunia Sub-licence Agreement. As disclosed above, the Extension Letter was entered into by Hysan the Company and Neptunia for the purpose of extending the term of the Neptunia Sub-licence Agreement and allowing the Group continue to use the relevant trademarks to distribute and sell its beer products in the ordinary course of its businesses of leasing and property management. The entering into relevant territories as specified in the Neptunia Sub-licence Agreement after resumption of the Service Agreements operations of the Company’s plant in Hong Kong, which is in line with Hysan essential to the principal business of the Group’s policy of centralizing the leasing activities, lease administration and property management of its portfolio. The Directors (including Independent Nonthe independent non-Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactionsexecutive Directors) are of the view that the transactions contemplated under the Service Agreements are on normal commercial terms, in the ordinary and usual course of business of Hysan Group after due negotiations and on arm’s length basis with reference to the prevailing market conditions, consider the terms of the Service Agreements Neptunia Sub- licence Agreement (as extended by the Extension Letter) are fair and reasonable and on normal commercial terms and that the transactions thereunder are in the interests of the Company and its the shareholders of the Company as a whole. The Directors (including Independent Non- Executive Directors but excluding Xx. Xxxxxx who has material interest in CONTINUING CONNECTED TRANSACTIONS SMC is the transactions) also believe that the Annual Caps for the Service Agreements are fair and reasonable. REGULATORY ASPECTS Barrowgate is a non-wholly owned subsidiary ultimate controlling shareholder of the Company and a connected person through Neptunia, it holds 245,720,800 Shares representing approximately 65.78% of the Company under the Listing Rules by virtue of Jebsen & Co. holding 10% issued shares in Barrowgate. Jebsen & Co. is an associate of Xx. Xxxxxx, a Non-Executive Director share capital of the Company and therefore thus Neptunia is a connected person of Hysan at the listed issuer level. HLCL and HPML are wholly-owned subsidiaries of the Company. Accordingly, the Service Agreements and transactions contemplated thereunder constitute licensing arrangement under the Neptunia Sub-licence Agreement constitutes a continuing connected transaction for the Company. As disclosed in the 2007 Announcement, the Group has also entered into other licence/sub-licence agreements with certain other members of the San Xxxxxx Group. For the purpose of complying with the continuing connected transactions for the Company requirements under Rule 14A.31 Chapter 14A of the Listing Rules, transactions with the San Xxxxxx Group under the SMC Group Licensing Arrangements (including the Trademark Licensing Agreement, the Neptunia Sub-licence Agreement and the SMBIL Sub-licence Agreement) are aggregated as a series of transactions. Due to At the interest of an associate of Xx. Xxxxxx in the Service Agreements, Xx. Xxxxxx abstained from voting on the relevant resolutions for approving the Service Agreements in the meeting time of the Board. Given that certain applicable percentage ratios in respect of the Annual Caps for the Service Agreements on an annual aggregated basis are more than 0.1% and less than 5%2007 Announcement, the Service Agreements fall under Rule 14A.76(2) of SMC Group Licensing Arrangements were subject to, and the Listing Rules and are only subject to Company has complied with, the announcement, reporting and annual review requirements but exempt from the independent shareholders’ approval announcement requirements under Chapter 14A of the Listing Rules. Particulars The terms of all other trademark licensing and sub-licensing arrangements (including the Trademark Licensing Agreement and the SMBIL Sub-licence Agreement) and the aggregate annual cap of less than HK$10 million for the SMC Group Licensing Arrangements during the remaining term of the Service Agreements will agreements under the SMC Group Licensing Arrangements remain unchanged. The Extension Letter was entered into at nil consideration and it is expected that the annual royalties payable by the Group under the Neptunia Sub-licence Agreement (as extended by the Extension Letter), when aggregated with other trademark licensing and sub-licensing arrangements with the San Xxxxxx Group, including the Trademark Licensing Agreement and the SMBIL Sub-licence Agreement, shall be disclosed less than HK$10 million for the year ending 31 December 2011. Accordingly, the transactions under the Neptunia Sub-licence Agreement (as extended by the Extension Letter) are subject to reporting and announcement requirements and exempt from the independent shareholders’ approval requirement under the Listing Rules. Xx. Xxxxxx Xxxxxxx X. Xxxxx is the common director of both the Company and Neptunia. As mentioned above, for the years ended 31 December 2008, 2009 and the 11-month period from 1 January 2010 to 30 November 2010, the royalties payable to Neptunia under the Neptunia Sub-licence Agreement amounted to approximately nil, HK$75,000 and HK$129,000 respectively. The Company is of the view that based on the historical transaction amount, the transactions pursuant to the Neptunia Sub-licence Agreement are not material to the operations of Neptunia and SMC and thus those Directors who are also directors of Neptunia, SMC and/or its subsidiaries (other than members of the Group) do not have a material interest in the relevant annual reports Neptunia Sub-licence Agreement. Accordingly none of the Directors abstained from voting on the Board resolution to approve the entering into of the Extension Letter and accounts of Hysan the transactions contemplated under the Neptunia Sub-licence Agreement in accordance compliance with Rule 14A.71 14A.59 (18) of the Listing Rules. The resolution was unanimously passed in the Board meeting. Were the vote from Xx. Xxxxxx Xxxxxxx X. Xxxxx not counted, the resolution would still be unanimously passed.

REASONS FOR THE TRANSACTIONS. The Service Agreements are renewal of the existing service agreements and were entered into by Hysan Group in the ordinary course of its businesses of leasing and property management. The entering into of the Service Agreements is in line with Hysan Group’s policy of centralizing centralising the leasing activities, lease administration and property management of its portfolio. The Directors (including Independent Non-Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactionsDirectors) are of the view that the transactions contemplated under the Service Agreements and the terms therein are on normal commercial terms, are fair and reasonable and in the interests of the Company and its shareholders as a whole, and that they were entered in the ordinary and usual course of business of Hysan Group after due negotiations and on arm’s length basis with reference to the prevailing market conditions, the terms of the Service Agreements are fair and reasonable and in the interests of the Company and its shareholders as a whole. The Directors (including Independent Non- Non-Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactionsDirectors) also believe that the Annual Caps for of the Service Agreements are fair and reasonable. REGULATORY ASPECTS Barrowgate is a non-wholly owned subsidiary of the Company and a connected person of the Company under the Listing Rules by virtue of it being a non wholly-owned subsidiary of the Company, and also having a substantial shareholder, namely Jebsen & Co. holding 10% issued shares in Barrowgate. Jebsen & Co. which is an associate of Xx. Xxxxxx, a Non-Executive Director of the Company and therefore a connected person of Hysan at the listed issuer levelCompany. HLCL and HPML are wholly-owned subsidiaries of the Company. Accordingly, the Service Agreements and transactions contemplated thereunder constitute continuing connected transactions for the Company under Rule 14A.31 of the Listing Rules. Due to the interest of an associate of Xx. Xxxxxx in the Service Agreements, Xx. Xxxxxx he abstained from voting on the relevant resolutions resolution for approving the Service Agreements Agreement in the meeting of the Boardboard of Directors. Given that certain each of the applicable percentage ratios in respect of the Annual Caps for the Service Agreements on an annual aggregated basis are is more than 0.1% and less than 5%, the Service Agreements fall under Rule 14A.76(2) of the Listing Rules and are only subject to the announcement, reporting and annual review requirements but are exempt from the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. Particulars of the Service Agreements will be disclosed in the relevant annual reports and accounts of Hysan in accordance with Rule 14A.71 of the Listing Rules.

REASONS FOR THE TRANSACTIONS. The Service Agreements Transactions are renewal of the existing service agreements previous lease and licence agreement and were entered into by Hysan Group in the ordinary course of its businesses business of leasing and property management. The entering into of the Service Agreements is in line with Hysan Group’s policy corporate strategy of centralizing the leasing activities, lease administration maximising its properties’ cashflow and property management of its portfoliovalue. The Directors (including Independent Nonnon-Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactionsexecutive Directors) are of the view that the transactions contemplated under the Service Agreements Transactions and their respective terms therein are on normal commercial terms, are fair and reasonable and in the interests of the Company and its shareholders as a whole, and that they were entered in the ordinary and usual course of business of Hysan Group after due negotiations and on arm’s length basis with reference to the prevailing market conditions, the terms of the Service Agreements are fair and reasonable and in the interests of the Company and its shareholders as a whole. The Directors (including Independent Non- Executive Directors but excluding Xx. Xxxxxx who has material interest in the transactionsnon-executive Directors) also believe that the Annual Caps for of the Service Agreements Transactions are fair and reasonable. REGULATORY ASPECTS Barrowgate Pearl Investments is a non-wholly owned subsidiary of the Company and a connected person of the Company under the Listing Rules by virtue of Jebsen & Co. holding 10% issued shares in Barrowgate. Jebsen & Co. is its being an associate of Xx. XxxxxxXxx, a Non-Executive executive Director of the Company and therefore a connected person of Hysan at the listed issuer level. HLCL and HPML are wholly-owned subsidiaries of the Company. Accordingly, the Service Agreements and transactions contemplated thereunder Transactions (in aggregate) constitute continuing connected transactions for the Company under Rule 14A.31 14A.14 of the Listing Rules. Due to the interest of an associate of Xx. Xxxxxx Xxx in the Service AgreementsTransactions, Xx. Xxxxxx he abstained from voting on the relevant resolutions for approving the Service Agreements resolution in the meeting of the Boardboard of Directors. Given that certain applicable each of the percentage ratios (other than the profit ratio) in respect of the Annual Caps for the Service Agreements Transactions on an annual aggregated basis are more than 0.1% and is less than 5%, the Service Agreements Transactions fall under Rule 14A.76(2) 14A.34 of the Listing Rules and are only subject to the announcement, reporting and annual review requirements but set out in Rules 14A.37 to 14A.40 and Rules 14A.45 to 14A.47 of the Listing Rules and are exempt from the independent shareholders’ approval requirements under Chapter 14A Rule 14A.34 of the Listing Rules. Particulars of the Service Agreements Transactions will be disclosed in the relevant future annual reports and accounts of Hysan in accordance with Rule 14A.71 14A.46 of the Listing Rules.