09:57     POLY HK INV<00119> - Announcement (2)                               

    Rental  :  aggregate rental of RMB4,343,967.20 (approximately             
    HK$4,059,782.43) for the Exhibition Halls for the whole term under the    
    Exhibition Halls Lease Renewal Agreement                                  
                                                                              
    Other charges  :  gas, water, electricity and telephone charges will be   
    charged on a reimbursement basis and borne by China Poly as the lessee    
                                                                              
    Payment Term  :  The rental and miscellaneous charges will be payable     
    annually in arrears within 30 days after the expiration of the annual     
    term and in two equal instalments.                                        
                                                                              
    THE CAP AMOUNTS                                                           
                                                                              
    The aggregate total rental payable under the Lease Renewal Agreements     
    for each of the financial years ending 31st December, 2006 are subject    
    to the cap amounts as follows:                                            
                                                                              
    Cap Amounts                                                               
                                                                              
    Office Tower Lease Renewal Agreement  RMB7,088,519.00                     
      (approximately HK$6,624,784.11  )                                       
                                                                              
    Exhibition Halls Lease Renewal Agreement  RMB2,171,983.60                 
      (approximately HK$2,029,891.21  )                                       
                                                                              
    The cap amounts are determined with reference to the agreed rental to     
    be received under the Lease Renewal Agreements.                           
                                                                              
    REASONS FOR THE LEASE RENEWAL AGREEMENTS                                  
                                                                              
    China Poly, as a sincere supporter and promoter of arts and culture in    
    the PRC, has an extensive networking in the cultural society of the       
    PRC. While it is expected that China Poly will be able to offer           
    fabulous exhibition which would enhance the value of the Exhibition       
    Halls and Poly Plaza, the Directors consider that China Poly is a         
    desirable tenant for the Exhibition Halls.                                
                                                                              
    Pursuant to the term of the lease renewal agreements both dated 12th      
    February, 2003 entered into between PPL and China Poly in respect of      
    the Office Area and the Exhibition Halls, the term of the previous        
    tenancies expired on 31st December, 2004. Following the expiration of     
    the previous tenancies, the parties agreed to renew the tenancies of      
    the Office Area and the Exhibition Halls. The Directors considered that   
    the tenancies can generate a stable return to PPL.                        
                                                                              
    The Directors (including the independent non-executive directors) of      
    the Company considered that the Lease Renewal Agreements were             
    negotiated on an arm's length basis between the Company and China Poly    
    on normal commercial terms. They are also of the opinion that the Lease   
    Renewal Agreements were entered into in the ordinary and usual course     
    of business of the Company and the terms of the Lease Renewal             
    Agreements are fair and reasonable so far as the Company and the          
    shareholders are concerned and in the interests of the Company and its    
    shareholders as a whole.                                                  
                                                                              
    VALUATION                                                                 
                                                                              
    With reference to two valuation reports both dated 21st January, 2005     
    prepared by the Valuer, on the Office Area and the Exhibition Halls,      
    the Valuer is of the opinion that the rental is adequate and is in line   
    with the then market rental level and the terms and conditions            
    contained in the Lease Renewal Agreements are acceptable. Having          
    considered the opinion of the Valuer, the Directors, including the        
    independent non-executive directors, considered that the rental under     
    the Lease Renewal Agreements are fair and reasonable so far as the        
    interests of the Company and shareholders are concerned.                  
                                                                              
    INFORMATION ON POLY PLAZA                                                 
                                                                              
    Poly Plaza comprises one hotel tower and one office tower, each of 16     
    storeys standing on a five-storey commercial podium containing            
    restaurants, entertainment and retailing spaces and a theatre and 3       
    basement floors for car parks. Poly Plaza has a total gross floor area    
    of 94,649 square metres and is located at No. 14 Dongzhimen Nandajie,     
    Dong Cheng District, Beijing, in the PRC.                                 
                                                                              
    The Office Area is currently used as headquarter office of China Poly.    
    The Exhibition Halls is currently used by China Poly as a museum.         
                                                                              
    BUSINESS OF THE COMPANY, PPL AND CHINA POLY                               
                                                                              
    The Company is an investment holding company principally engaged in the   
    property investment and management, hotel and restaurant operations,      
    supply of electricity and gas, shipping, financial services, and