09:31     LIFESTYLE INT'L<01212> - Announcement & Resumption (4)              

    It is proposed that the aggregate of the annual rental, the               
    Air-conditioning Charges and Management Fees, extra                       
    air-conditioning charges, vetting fee for the fitting out                 
    works and sharing of fees received for displaying                         
    promotional materials on the glass walls and windows of the               
    entrance and the 24-hour passage payable by Sogo HK for each              
    of the three years ending 31 December 2007 shall be subject               
    to a cap of HK$75 million for the purpose of Chapter 14A                  
    of the Listing Rules.  The Cap is determined by reference                 
    to the Company's internal estimation of sales, taking into                
    account, inter alia, historical sales performance of our                  
    existing store in Causeway Bay, our estimation of customer                
    flows, average transaction size and sales performance of                  
    other shops in the Tsimshatsui area, and Air-conditioning                 
    Charges and Management Fees, extra air-conditioning                       
    charges, vetting fee for the fitting out works and sharing                
    of fees received for displaying promotional materials on                  
    the glass walls and windows of the entrance and the 24-hour               
    passage to be incurred plus a reasonable buffer.                          
                                                                              
    If the aggregate actual amount of annual rental, the                      
    Air-conditioning Charges and Management Fees and such                     
    charges and fees payable by Sogo HK mentioned above under                 
    the Lease shall exceed the Cap or upon the expiry of the                  
    Cap or where the Lease is renewed or there is a material                  
    change to the terms of the Lease, the Company will re-comply              
    with all applicable requirements under the Listing Rules,                 
    including (where required) the obtaining of approval of the               
    Independent Shareholders.                                                 
                                                                              
    REASONS FOR AND BENEFITS OF ENTERING INTO THE LEASE                       
                                                                              
    The principal business of the Group is the operation of                   
    lifestyle department stores and other retail outlets.  The                
    department stores and other retail outlets currently                      
    operated by the Group are located at Causeway Bay and                     
    Shanghai.  It is intended that, subject to obtaining the                  
    approval of the licensor of the "SOGO" trademarks, the                    
    Premises will be used for the operation of a Sogo department              
    store.  The Lease enables the Group to expand its                         
    department store business to the Kowloon side of Hong Kong                
    at a prime location in Tsimshatsui and generate additional                
    retail revenue which is beneficial to the Group.                          
                                                                              
    The Company has engaged CB Richard Ellis, an independent                  
    professional property valuer, to review the Lease.  On the                
    basis of the advice received from CB Richard Ellis, the                   
    Directors are of the opinion that the terms of the Lease                  
    are on normal commercial terms and no less favourable to                  
    the Group than those available to independent third parties               
    and the Lease and the Cap are fair and reasonable and in                  
    the commercial interests of the Company and the                           
    Shareholders as a whole.  Furthermore, the Lease was                      
    entered into in the ordinary and usual course of business                 
    of the Group after due negotiations on an arm's length basis              
    with reference to the prevailing market conditions.                       
                                                                              
    INFORMATION OF THE GROUP AND THE CONNECTED PERSONS                        
                                                                              
    The Group is principally engaged in the operation of                      
    lifestyle department stores and other retail outlets and                  
    ownership of properties.                                                  
                                                                              
    Sogo HK is principally engaged in the operation of                        
    department store in Hong Kong.                                            
                                                                              
    HK Island is principally engaged in property investment                   
    business.                                                                 
                                                                              
    GENERAL INFORMATION                                                       
                                                                              
    As the Lease constitutes a continuing connected transaction               
    and the applicable percentage ratio for the Cap exceeds 2.5%,             
    the Lease is subject to the reporting and independent                     
    shareholders' approval requirements under Rule 14A.35 of                  
    the Listing Rules.  An EGM will be convened for Independent               
    Shareholders to approve the Lease and the Cap by poll.                    
                                                                              
    In view of the interests of CTF in the Company held                       
    indirectly through Real Reward, CTF, Real Reward and HK                   
    Island and their respective associates will abstain from                  
    voting in relation to the resolutions to approve the Lease                
    and the Cap.  Save and except Real Reward currently holds                 
    540,000,000 shares, representing 72.29% of the issued share               
    capital of the Company, none of CTF, HK Island and their