09:38 TAI PING CARPET<00146> - Announcement (2) Parties TPCL (as supplier) and The Peninsula Hotel Limited (as customer). Nature of the transaction The supply of carpets relocation services in the Peninsula Hotel, Hong Kong. Consideration HK$1,500. Third Connected Transaction Date 8 February 2005. Parties CITPCL (as supplier) and SCHCL (as customer). Nature of the transaction The supply of carpets and ancillary services for use in the Peninsula Hotel, Bangkok. Consideration Thai Baht 4,148,632.70 (equivalent to approximately HK$871,213). CONSIDERATION The aggregate value of the consideration payable under the Connected Transactions is approximately HK$1,293,316. The consideration payable for the goods and services supplied under the Connected Transactions was determined by reference to the Tai Ping Group's standard price lists for such goods and services subject to amendments agreed following arm's length negotiations conducted between the parties. Accordingly, such transactions are on normal commercial terms such terms being no more favourable to the HSH Group than would be offered to other independent customers in similar circumstances. RELATIONSHIP BETWEEN THE COMPANY AND HSH BTCL is a substantial shareholder of the Company indirectly holding approximately 56% of the issued share capital of the Company. BTCL is also interested in approximately 60% of the voting power of HSH. Accordingly, HSH and the other members of the HSH Group are considered connected persons of the Company for the purposes of the Listing Rules. REASONS FOR AND BENEFITS OF THE CONNECTED TRANSACTIONS Under the Connected Transactions the Tai Ping Group has supplied goods and services in the ordinary course of business on normal commercial terms to the HSH Group for use in its hotels. Such transactions generate revenue and profits for the Tai Ping Group in the usual and ordinary course of its business. The directors of the Company (including the independent non-executive directors) believe the terms of the Connected Transactions are fair and reasonable and in the interests of the shareholders of the Company as a whole. GENERAL The Tai Ping Group is principally engaged in the sale of furnishing products such as carpets, rugs, furniture, interior furnishings, soft furnishings antiques lights, electrical home appliances, ceramics, home accessories and decorative items. The HSH Group is principally engaged in the ownership and management of prestigious hotels and commercial and residential properties in key destinations in Asia and the USA. It is the owner and operator of The Peninsula Hotels. If requested to do so, the Tai Ping Group may continue to supply goods and services to the HSH Group in the ordinary course of its business. The Company will comply with the Listing Rules in respect of any such transactions. In this announcement, amounts denominated in Thai Baht have been translated into Hong Kong dollars at an exchange rate of Thai Baht 4.76 = HK$1.00. Such conversions shall not be construed as representations that the amount in Thai Baht were or may have been converted into Hong Kong dollars at such rates or any other exchange rates. As at the date of this announcement, the directors of the Company are Chairman: Mr James S Dickson Leach, Honorary Life President: Mr Anthony Y C Yeh, Chief Executive Director: Mr James H Kaplan, Executive Director: Ms Alison S Bailey, Independent Non-executive Directors: Mr Michael T H Lee, Mrs Yvette Y H Fung, Mr Lincoln C K Yung, Non-executive Directors: Mr Ian D Boyce, Mr John J Ying, Mr Kent M C Yeh, Mr Nicholas T J Colfer, Mr Lincoln K K Leong, Alternate Directors: Mr Nelson K F Leong (Alternate to Mr Lincoln K K Leong), Mr David C L Tong (Alternate