10:16 WANG ON GROUP<01222> - Announcement (1) The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. Wang On Group Limited (Incorporated in Bermuda with limited liability) (Stock Code: 1222) DISCLOSEABLE TRANSACTION RELATING TO ACQUISITION OF A PROPERTY On 25 January 2005, Longable, a wholly owned subsidiary of the Company, entered into the Provisional Agreement pursuant to which Longable conditionally agreed to acquire from Yield Land the Property for a cash consideration of HK$16,300,000. The Acquisition constitutes a discloseable transaction for the Company pursuant to Rule 14.06(2) of the Listing Rules. A circular containing, amongst other things, further information relating to the Provisional Agreement, the Property and the Acquisition will be despatched to the Shareholders as soon as practicable. INTRODUCTION On 25 January 2005, Longable, a wholly owned subsidiary of the Company, entered into the Provisional Agreement pursuant to which Longable conditionally agreed to acquire from Yield Land the Property for a cash consideration of HK$16,300,000. The details of the Provisional Agreement are set out below: THE PROVISIONAL AGREEMENT Date : 25 January 2005 Purchaser : Longable, a wholly owned subsidiary of the Company Vendor : Yield Land To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, Yield Land and its ultimate beneficial owner are independent third parties not being connected persons (as defined in the Listing Rules) of the Company. Property : Shop 6, G/F, Grandeur Garden, Nos. 14-18 Chik Fai Street, Nos. 55-65 Tai Wai Road, Shatin, New Territories, Hong Kong. The Property has a total gross floor area of approximately 674 square feet. As at the date of this announcement, the Property is occupied for commercial purposes, and will be delivered to Longable upon completion of the Acquisition subject to and with the benefit of the existing tenancy agreement in relation to the Property with a term from 1 October 2004 to 30 September 2006, at a monthly rental of HK$63,000 from 1 October 2004 to 30 September 2005 and HK$60,000 from 1 October 2005 to 30 September 2006. The tenant of the Property has the option to renew the existing tenancy agreement for one more year from 1 October 2006 to 30 September 2007 at a monthly rental of HK$60,000. To the best of the Directors' knowledge, information and belief having made all reasonable enquiry, the tenant of the Property, namely Loyal Zone Corporation Limited, and its ultimate beneficial owner are independent third parties not being connected persons (as defined in the Listing Rules) of the Company. Consideration : HK$16,300,000, which was determined after arm's length negotiations between the parties. In arriving at the consideration, the Directors have taken into account the prevailing market conditions and made reference to the prices of similar properties located in the nearby area. Payment of the consideration : Pursuant to the Provisional Agreement, the consideration for the Acquisition shall be paid in cash in the following manner: (i) a sum of HK$500,000 shall be paid upon signing of the Provisional Agreement; (ii) a sum of HK$1,130,000 shall be paid on or before 1 February 2005; and (iii) the balance of HK$14,670,000 shall be paid upon completion of the Acquisition on or before 1 March 2005 or on or before 28 February 2005 if so requested by Yield Land.