10:04     NWS HOLDINGS<00659> -  Announcement (3)                             

    Terms and pricing policies                                                
                                                                              
    Pursuant to the Master Services Agreement, members of the NWD Group       
    and members of the Group shall, from time to time during the term of      
    the Master Services Agreement, enter into separate Operational            
    Agreements in respect of the provision and/or acquisition of the          
    Operational Services and the Other Services. The terms of each            
    Operational Agreement shall be the same as the provisions of the          
    Master Services Agreement except for operational details. The Company     
    and NWD have agreed that:                                                 
                                                                              
    (a)   With respect to the Operational Services:                           
                                                                              
    (i)   the prices and terms of the Operational Agreements with respect     
    to the Contracting Services, the Facility Management Services, the        
    Property Management Services, the Cleaning and Landscaping Services       
    and the Financial Services shall be determined in the ordinary course     
    of business at prices and terms no less favourable than those charged     
    and provided to independent third party customers;                        
                                                                              
    (ii)   the prices and terms at which the Security and Guarding            
    Services are to be provided shall be determined in the ordinary course    
    of business on a cost-plus basis at prices and terms no less favourable   
    than those charged to and contracted with other independent third         
    party customers; and                                                      
                                                                              
    (iii)   the term of each Operational Agreement shall be fixed and in      
    any event shall not exceed three years. If the term of an Operational     
    Agreement extends beyond 30 June 2008 (that is, the expiry date of        
    the Master Services Agreement), the Company shall re-comply with the      
    reporting, announcement and independent shareholders' approval            
    requirements under Rules 14A.45 to 14A.48 of the Listing Rules and/or     
    any other applicable Listing Rules at the relevant time.                  
                                                                              
    (b)   With respect to the Other Services:                                 
                                                                              
    (i)   in respect of the rental of properties, vehicles and vessels,       
    the rent payable shall be based on normal commercial terms, negotiated    
    on an arm's length basis at prices and terms no less favourable than      
    those charged and provided by the NWD Group to independent third          
    parties; and                                                              
                                                                              
    (ii)   the prices and terms at which food products are to be sold shall   
    be those applicable from time to time in the ordinary course of           
    business at prices and terms no less favourable than those charged        
    and provided by the Group to independent third party customers; and       
                                                                              
    (iii)   the term of each Operational Agreement shall be fixed and in      
    any event shall not exceed three years. If the term of an Operational     
    Agreement extends beyond 30 June 2008 (that is, the expiry date of        
    the Master Services Agreement), the Company shall re-comply with the      
    reporting, announcement and independent shareholders' approval            
    requirements under Rules 14A.45 to 14A.48 of the Listing Rules and/or     
    any other applicable Listing Rules at the relevant time.                  
                                                                              
    Historical figures                                                        
                                                                              
    The aggregate transaction values in respect of the Operational            
    Services for the years ended 30 June 2002, 2003 and 2004 were             
    approximately HK$1,435 million, HK$1,811 million and HK$2,115             
    million respectively.                                                     
                                                                              
    The aggregate transaction values in respect of the Other Services for     
    the years ended 30 June 2002, 2003 and 2004 were approximately HK$35      
    million, HK$36 million and HK$29 million respectively.                    
                                                                              
    3.   REASONS FOR, AND BENEFITS, OF THE MASTER SERVICES AGREEMENT          
                                                                              
    The Continuing Connected Transactions are expected to be of a             
    recurrent nature and will occur on a regular and continuing basis in      
    the ordinary and usual course of business of the Group. Under the         
    Master Services Agreement, the terms of the Operational Agreements        
    will be agreed on an arm's length basis and on normal commercial terms.   
    The Directors (excluding the independent non-executive directors) of      
    the Company are of the view that the terms of the Master Services         
    Agreement are fair, reasonable and in the interests of the Company        
    and its shareholders as a whole, and that it is beneficial to the         
    Company to enter into the Master Services Agreement as the continuing     
    connected transactions thereunder will continue to facilitate the         
    operation of the Group's businesses in general.                           
                                                                              
    4.   MAXIMUM AGGREGATE ANNUAL VALUES                                      
                                                                              
    The Company expects that the maximum aggregate annual value (the          
    Annual Cap) in respect of each category of the Operational Services       
    and the Other Services contemplated under the Master Services             
    Agreement will be as follows: