11:09     TAI FOOK SEC<00665> - Announcement (5)                              

    So far in this current financial year the Group has already               
    engaged in discussions with a view to solicit from the Listed             
    Connected Clients for placement, underwriting and/or                      
    sub-underwriting transactions, which, if materialised, the                
    Group anticipates will generate placing, underwriting and                 
    sub-underwriting commitment which will represent about half of            
    the above proposed annual cap. Since the Company is only three            
    months into its current financial year and the Group is already           
    anticipated to be able to solicit about half of the above proposed        
    annual cap, the Directors are of the view that such proposed              
    annual cap is fair and reasonable.                                        
                                                                              
    REASONS FOR THE TRANSACTIONS                                              
                                                                              
    The Directors consider it to be in the best interests of the              
    Group and the Independent Shareholders to enter into the Master           
    Agreements on the following grounds:                                      
                                                                              
    (i)     the Group in its ordinary and usual course of business, will      
    provide financial advisory services to its clients (including             
    the Connected Clients) and therefore the provision of such                
    services to the Connected Clients will contribute positively              
    to the Group's income;                                                    
                                                                              
    (ii)    the placement, underwriting or sub-underwriting of the            
    securities of the Connected Clients would continue to contribute          
    positively to the Group's income; and                                     
                                                                              
    (iii)   the Listed Connected Clients can utilise the sales and            
    distribution network of the Group to enlarge their capital and            
    shareholder bases.                                                        
                                                                              
    RELATIONSHIP BETWEEN THE PARTIES TO THE MASTER AGREEMENTS AND             
    THE COMPANY                                                               
                                                                              
    The Connected Clients include CTFE and Mr. Lo and their                   
    respective associates.                                                    
                                                                              
    Based on publicly available information, (i) CTFE is the                  
    controlling shareholder of NWD and International Entertainment            
    Corporation (formerly known as Cyber On-Air Group Company                 
    Limited), the shares of both of which are listed on the Stock             
    Exchange; (ii) NWS Holdings Limited, New World TMT Limited, New           
    World China Land Limited and New World Mobile Holdings Limited,           
    the shares of all of which are listed on the Stock Exchange,              
    are subsidiaries of NWD; and (iii) CTFE, through its wholly-owned         
    subsidiary, is interested in 50% of the equity interest of the            
    controlling shareholder of Lifestyle International Holdings               
    Limited, the shares of which are listed on the Stock Exchange.            
                                                                              
    NWD is a listed company on the Stock Exchange with market                 
    capitalisation of approximately HK$25.9 billion and controls,             
    directly or indirectly, a number of other listed companies on             
    the Stock Exchange. The above listed companies on the Stock               
    Exchange have a total market capitalisation of approximately              
    HK$55.0 billion as at the date of this announcement.                      
                                                                              
    As at the date of this announcement, CTFE holds 30,977,916 Shares,        
    representing approximately 5.3% of the total issued share                 
    capital of the Company. CTFE is an investment holding company             
    incorporated in Hong Kong which is controlled by the family of            
    Dato' Dr. Cheng Yu Tung. Dato' Dr. Cheng Yu Tung is the father            
    of Dr. Cheng Kar Shun, Henry, the Chairman of the Company and             
    an executive Director.                                                    
                                                                              
    As at the date of this announcement, CTFN holds 107,140,540               
    Shares, representing approximately 18.3% of the total issued              
    share capital of the Company. CTFN is wholly and beneficially             
    owned by Dato' Dr. Cheng Yu Tung.