2015 — Page 129

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

MATERIAL RELATED PARTY AND CONNECTED TRANSACTIONS (Continued)

28

(b)

Other material related party and connected transactions (Continued)

(iii)

(iv)

(v)

In December 2002, the Group appointed a wholly-owned subsidiary of HLD ("HLD Sub A") as the leasing and promotion agent of the commercial arcade of the MHV Property, Metro Harbour Plaza ("MHP"), for an initial term of two years at the remuneration of 5% of the monthly rental income from MHP and such agreement shall thereafter be renewable on the same terms from year to year until terminated by either party by giving three months' prior notice in writing. An amount of HK$1,903,000 (2014: HK$1,663,000) was charged to the Group for the year. At 31 December 2015, an amount of HK$990,000 (2014: HK$881,000) remained unpaid and was included in trade and other payables.

As the aforementioned agreement was renewable on the yearly basis until terminated by either party, the Group had monitored the receipt of the funds during the year.

In May 2006, the Group appointed a wholly-owned subsidiary of HLD ("HLD Sub C") as the main contractor for a fee of 5% on all works relating to the development of Shining Heights, Nos. 220-222 Tai Kok Tsui Road, Kowloon, Hong Kong (the "TKT Property"). The aggregate of the cost of works carried out by the main contractor or any connected persons (as defined in the Listing Rules) of the Group together with the 5% fee shall be subject to a total annual ceiling of HK$16,000,000 up to the period end of 31 March 2009. In September 2009, the prime cost contract extension letter was signed which all the terms and conditions remain unchanged except to extend the period of payment for the respective ceiling of HK$5,500,000 and HK$6,500,000 for the nine months ended 31 December 2009 and for the year ended 31 December 2010 respectively.

During the years ended 31 December 2015 and 2014, there were no change in cost estimates. At 31 December 2015, an amount of HK$2,294,000 (2014: HK$2,294,000), which included amounts payable to other subcontractors through this main contractor, remained unpaid and was included in trade and other payables.

In November 2008, the Group appointed HLD Sub A as the agent of the Group for marketing of the TKT Property for the period from 16 June 2008 to the earlier of 15 December 2009 and the date on which the last residential unit in the TKT Property to be sold is sold. At 31 December 2014, an amount of HK$1,104,000 remained unpaid and was included in trade and other payables. The balance has been repaid during the year ended 31 December 2015.

Hong Kong Ferry (Holdings) Company Limited

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Annual Report 2015