NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
MATERIAL RELATED PARTY AND CONNECTED TRANSACTIONS (Continued)
30
(b)
Other material related party and connected transactions (Continued)
(vi)
(vii)
In September 2013, the Group appointed HLD Sub A as the project manager of the development of Hung Hom Inland Lot No. 555, Kowloon, Hong Kong located at the junction of Gillies Avenue South and Bulkeley Street, Hung Hom, Kowloon, Hong Kong (the "Hung Hom Property") for a term of three years commencing from 5 September 2013 in consideration fer- a fee equivalent to the aggregate of 1% of the construction costs of the Hung Hom Property and other lump sum fees for supplementary services subject to the respective ceilings for the years ended 31 December 2013, 31 December 2014, 31 December 2015 and 31 December 2016 of HK$1,300,000, HK$2,300,000, HK$2,300,000 and HK$600,000 respectively (the "Hung Hom Project Management Agreement"). A total fee of HK$595,000 was charged to the Group and the balance had been repaid during the year ended 31 December 2016. Pursuant to the terms of the Hung Hom Project Management Agreement, the appointment of HLD Sub A as project manager expired in September 2016. Accordingly, no fee has been charged during the year ended 31 December 2017.
In December 2013, the Group appointed another wholly-owned subsidiary of HLD ("HLD Sub B") as the sales manager of the development of the Hung Hom Property for a term of three years commencing from 1 January 2014 in consideration for a fee of 0.5% of the gross proceeds of sale (but excluding those sale and purchase agreements which were effected by a third party sales agent) were subject to the annual ceilings for the years ended 31 December 2014, 31 December 2015 and 31 December 2016 of HK$2,500,000, HK$1,000,000 and HK$1,500,000 respectively (the "Hung Hom Sales Management Agreement"). A total fee of HK$38,000 was charged to the Group during the year ended 31 December 2016. Pursuant to the terms of the Hung Hom Sales Management Agreement, the appointment of HLD Sub B as sales manager expired in December 2016.
In January 2017, the Group entered into a letter agreement with HLD Sub B and HLD Sub B continued to act as the sales manager of the Group in respect of the sale and purchase of the remaining residential units of the Hung Hom Property for a further period of one year commencing from 1 January 2017 and ended on 31 December 2017 (the "Letter Agreement"). The aggregate amount of fees receivable by HLD Sub B as remuneration under the appointment were subject to a ceiling of HK$1,000,000 for the year ended 31 December 2017.
No fee has been charged during the year ended 31 December 2017. At 31 December 2017, no amount remained unpaid (2016: HK$Nil). Pursuant to the terms of the Letter Agreement, the appointment of HLD Sub B as sales manager expired in December 2017.
In December 2017, the Group entered into a second letter agreement with HLD Sub B and HLD Sub B continued to act as the sales manager of the Group in respect of the sale and purchase of the remaining residential units of the Hung Hom Property for a further term of three years commencing from 1 January 2018 to 31 December 2020 (the "Term of Appointment"). The aggregate amount of fees receivable by HLD Sub B as remuneration under the appointment shall be subject to a ceiling of HK$1,000,000 per annum during the Term of Appointment.
149
Hong Kong Ferry (Holdings) Company Limited
Annual Report 2017