10:26 CENTURY LEGEND<00079> - Announcement & Resumption (4) Option Period The Fastpro Call Option is exercisable at any time during a period of one year from 9th April, 2005. CL Properties is entitled to surrender the Fastpro Call Option by giving Keenfull not less than seven business days' notice. As at the date of this announcement, CL Properties and the Directors do not intend or plan to surrender the Fastpro Call Option. Management Of The Hotel The Hotel is a 28-storey 4 star hotel located at 68, 82, 86 & 102A-D Rua De Pequim, Macau which is a densely populated area in Macau. It is easily accessible, and is well served by various modes of public transport. The Macau International Airport is about 10 to 15 minutes drive distance from the Hotel whereas the Macau Ferry Terminal is about 5 to 10 minutes drive away. The Hotel has an aggregate gross floor area of approximately 28,000 square metres accommodating a total of 410 guest rooms, including 23 rooms and suites on the Executive Club Floor especially designed for business travellers. The Hotel offers a variety of services including rooms, food and beverages and gaming and night club entertainment. Except for the Diamond Entertainment Hall and the night club which are leased by Longnex under two separate tenancy agreements to and operated by two different independent third parties, the day-to-day management of the Hotel is handled by Holiday Inns (Macau) Limited pursuant to a hotel management contract dated 30th May, 1990 (as supplemented and varied) made between Longnex and the Hotel Manager. The Group owns a 15% interest in the DEH Syndicate which currently is the sole gaming intermediary appointed to market and organise trips for the purpose of introducing customers to participate in the gaming activities at the Diamond Entertainment Hall located in the Hotel. As announced by the Company on 25th January, 2005, a wholly-owned subsidiary of the Company and China Sky entered into a joint venture agreement to form and incorporate companies in Macau with limited liabilities to apply for and obtain the gaming intermediary licence to continue the gaming intermediaries operation currently conducted by the DEH Syndicate. All conditions precedent contained in the joint venture agreement have been satisfied. However, as at the date of this announcement, the gaming intermediary licence has not yet been issued by the relevant Macau governmental authorities and in the meantime the gaming intermediaries operation continues to be conducted by the DEH Syndicate. Pursuant to the Hotel Management Contract between Longnex and the Hotel Manager, all sum received from the operation of the Hotel except the rental income arising from the Diamond Entertainment Hall and the night club and all items paid by the Hotel Manager arising by virtue of the Hotel Manager's operation of the Hotel will be passed through a bank account established by Longnex. Longnex has to maintain a minimum cash level in such bank account for the daily operation of the Hotel. Any excess funds will be disbursed monthly to Longnex. The rental incomes arising from the Diamond Entertainment Hall and the night club are directly received by Longnex. It is agreed under the Option Agreement that during the Option Period, CL Properties (or LNX after the Novation) shall manage the entire Hotel Business, and be empowered to do all acts as required for the due compliance by Longnex with the Hotel Management Contract and other commercial contracts relating to the Hotel Business. CL Properties (or LNX after the Novation) also undertakes to assume sole responsibilities for all financial obligations and other liabilities of Longex during the Option Period and for this purpose, shall (without limitation): (i) pay all fees, costs, expenses and other outgoings which Longnex may incur or suffer and any other monies for which Longnex may become liable during the Option Period whether directly or indirectly, in respect of the Hotel; and (ii) indemnify and keep Longnex indemnified from and against any and all loss, damage, cost, fine, penalty or other liability (whether criminal or civil) suffered and all legal fees and other expenses incurred by Longnex during the Option Period, whether directly or indirectly, in respect of the Hotel, including any claim against Longnex by any third party relating to the Hotel. In return, CL Properties (or LNX after the Novation) shall commencing from 9th April, 2005 and thereafter during each calendar month over the Option Period (subject to revocation of the grant of the Fastpro Call Option) receive from Fastpro on monthly basis all cash receipts received by Longnex from the Hotel Manager and the rental income pursuant to the two lease agreements as discussed above. The audited profits from operating activities of Longnex for the two years ended 31st December, 2003 and 2004 were HK$9.6 million and HK$20.6 million respectively. After deducting interests for a shareholder's