CAI Corp — Share Issue/Capital Change 2008

Feb 5, 2008

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

This announcement is for information only and does not constitute an offer to shareholders or any other persons to acquire, purchase or subscribe for securities of the Company.

HARBOUR CENTRE DEVELOPMENT LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 51)

PROPOSED RIGHTS ISSUE OF 157,500,000 RIGHTS SHARES

AT HK$12.80 EACH

ON THE BASIS OF ONe RIGHTS SHARE FOR EVERY TWO EXISTING SHARES HELD ON THE RECORD DATE

AND

PROPOSED INCREASE IN AUTHORISED SHARE CAPITAL

Underwriter of the Rights Issue

The Wharf (Holdings) Limited

PROPOSED RIGHTS ISSUE

Subject to the Capital Increase taking effect, the Company proposes to raise not less than approximately HK$2,016 million before expenses by way of a rights issue of 157,500,000 Rights Shares at a price of HK$12.80 per Rights Share on the basis of one Rights Share for every two existing Shares held on the Record Date. Pursuant to the Rights Issue, the Qualifying Shareholders will be provisionally allotted one Rights Share in nil-paid form for every two existing Shares held on the Record Date. The estimated net proceeds of the Rights Issue is approximately HK$2,000 million which shall be applied by the Group to meet its capital requirements arising from the initiative of expanding into properties in the PRC.

As at the date of this announcement, Wharf is, through its wholly-owned subsidiary, interested in 210,379,500 Shares, representing approximately 67% of the issued share capital of the Company. Pursuant to the Underwriting Agreement, Wharf has undertaken to the Company that, subject to the Rights Issue not being terminated, it will not, without the prior written consent of the Company, transfer or otherwise dispose of (including without limitation the creation of any option, charge or other encumbrances or rights over or in respect of) or acquire (except by taking up the Rights Shares) any Share or any interest therein at any time between the date of the Underwriting Agreement up to and including 4:00 p.m. on the first Business Day after the Acceptance Date.

In addition, Wharf has also undertaken that it would place such number of Underwritten Shares to independent third parties to comply with the public float requirements under the Listing Rules in the event that the percentage of public float resulting from completion of the Rights Issue falls below the required minimum percentage under the Listing Rules in respect of the Company. Wharf will take appropriate steps/measures to ensure sufficient public float of the Shares upon completion of the Rights Issue.

The Underwritten Shares will be fully underwritten by Wharf on the terms and subject to the conditions set out in the Underwriting Agreement. If Wharf terminates the Underwriting Agreement (see sub-section headed “Termination of the Underwriting Agreement” below) or the conditions of the Rights Issue (see sub-section headed “Conditions of the Rights Issue” below) are not fulfilled, the Rights Issue will not proceed and will lapse.

Accordingly, the Rights Issue may or may not proceed. Shareholders and potential investors should therefore exercise caution when dealing in the Shares or Rights Shares in their nil-paid form, and if they are in any doubt about their position, they are recommended to consult their professional adviser(s). Moreover, investors’ attention is drawn to the section headed “Warning of the risks of dealing in the Shares and the nil-paid Rights Shares” below.

The last day of dealing in the Shares on a cum-rights basis is 19 February 2008. The Shares will be dealt with on an ex-rights basis from 20 February 2008. The Rights Shares are expected to be dealt with in their nil-paid form from 5 March 2008 to 12 March 2008 (both dates inclusive). To qualify for the Rights Issue, any transfer of the Shares (together with the relevant share certificates) must be lodged for registration with the Company’s share registrar, Tricor Tengis Limited, at 26/F Tesbury Centre, 28 Queen’s Road East, Wanchai, Hong Kong, by 4:30 p.m. on 21 February 2008. The Acceptance Date is expected to be on 17 March 2008 or such other date as the Company and Wharf may agree in writing. The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both their nil-paid and fully-paid forms.

The Prospectus containing, among other things, further details of the Rights Issue is expected to be despatched by the Company to the Qualifying Shareholders and for information only, to the Excluded Shareholders on the Posting Date. The provisional allotment letters and the forms of application for excess Rights Shares will also be sent to the Qualifying Shareholders on the same date.

PROPOSED CAPITAL INCREASE

In order to facilitate the Rights Issue, the Board intends to increase the authorised share capital of the Company from 380,000,000 Shares to 1,200,000,000 Shares by the creation of an additional 820,000,000 Shares. A circular containing details of the Capital Increase and a notice convening the Extraordinary General Meeting will be despatched to the Shareholders in due course.

PROPOSED RIGHTS ISSUE

Issue statistics

Basis of the Rights Issue:	one Rights Share for every two existing Shares held on the Record Date
Number of existing Shares in issue:	315,000,000 Shares as at the date of this announcement
Number of Rights Shares:	157,500,000 Rights Shares
Underwriter:	Wharf

Under the Rights Issue, 157,500,000 nil-paid Rights Shares would be provisionally allotted, representing 50% of the existing issued share capital of the Company and approximately 33.3% of the issued share capital of the Company as enlarged by the issue of 157,500,000 Rights Shares.

As at the date of this announcement, the Company had no outstanding convertible securities, options or warrants in issue which would otherwise confer any right to subscribe for, convert or exchange into the existing Shares.

Qualifying Shareholders

To qualify for the Rights Issue, a Qualifying Shareholder must be registered as a member of the Company as at the close of business on the Record Date. In order to be registered as members of the Company on the Record Date, all transfers of the Shares must be lodged (together with the relevant share certificate(s)) with the Company’s share registrar by 4:30 p.m. (Hong Kong time) on 21 February 2008.

The share registrar of the Company is:

Tricor Tengis Limited

26/F, Tesbury Centre

28 Queen’s Road East

Wanchai, Hong Kong

The Company will send the Rights Issue Documents to the Qualifying Shareholders on the Posting Date. The Company will send only the Prospectus to the Excluded Shareholders (if any) for information purposes on the same date.

Closure of register of members

The register of members of the Company will be closed from 22 February 2008 to 26 February 2008, both dates inclusive. No transfers of Shares will be registered during this period.

TERMS OF THE RIGHTS ISSUE

Subscription Price

The Subscription Price of HK$12.80 per Rights Share is payable in full by a Qualifying Shareholder upon acceptance of the provisional allotment of the Rights Shares under the Rights Issue or application for excess Rights Shares or when a renouncee of any provisional allotment of the Rights Shares or a transferee of nil-paid Rights Shares applies for the Rights Shares. The Subscription Price represents:

(i) a discount of approximately 21% to the closing price of HK$16.30 per Share as quoted on the Stock Exchange on 4 February 2008, being the last trading day of the Shares on the Stock Exchange prior to this announcement;

(ii) a discount of approximately 21% to the average closing price of approximately HK$16.20 per Share as quoted on the Stock Exchange for the 5 consecutive trading days up to and including 4 February 2008, being the last trading day of the Shares on the Stock Exchange prior to this announcement;

(iii) a discount of approximately 20% to the average closing price of approximately HK$15.93 per Share as quoted on the Stock Exchange for the 10 consecutive trading days up to and including 4 February 2008, being the last trading day of the Shares on the Stock Exchange prior to this announcement;

(iv) a discount of approximately 26% to the average closing price of approximately HK$17.28 per Share as quoted on the Stock Exchange for the 30 consecutive trading days up to and including 4 February 2008, being the last trading day of the Shares on the Stock Exchange prior to this announcement; and

(v) a discount of approximately 15% to the theoretical ex-right price of approximately HK$15.13 based on the closing price of HK$16.30 per Share as quoted on the Stock Exchange on 4 February 2008, being the last trading day of the Shares on the Stock Exchange prior to this announcement.

The Subscription Price was arrived at after arm’s length negotiation between the Company and Wharf with reference to the market price of the Shares under the prevailing market conditions. The Directors consider the terms of the Rights Issue to be in the best interests of the Group and the Shareholders as a whole.

Basis of Provisional Allotments

One Rights Share (in nil-paid form) for every two existing Shares held by Qualifying Shareholders as at the close of business on the Record Date.

Status of the Rights Shares

The Rights Shares (when allotted, issued and fully paid) will rank pari passu with the then existing Shares in issue in all respects. Holders of fully paid Rights Shares will be entitled to receive all future dividends and distributions which may be declared, made or paid after the date of allotment and issue of the Rights Shares.

Certificates for the Rights Shares

Subject to the fulfillment by the Company of the conditions precedent to the Rights Issue as contained in the Underwriting Agreement, certificates for all fully-paid Rights Shares are expected to be posted by 25 March 2008 to those Qualifying Shareholders who have paid for and have accepted the Rights Shares by ordinary mail, at their own risk.

Fractions of the Rights Shares and Rights Shares would have been allotted to Excluded Shareholders had they been Qualifying Shareholders

The Company will not provisionally allot and issue and will not accept application for any fraction of the Rights Shares. The Company may sell any nil-paid Rights Shares created by adding fractions of the Rights Shares in the market, if any, and if it does so, it will keep the net proceeds for its own benefit.

In the case of Rights Shares (excluding fractional entitlements) which would have been allotted to Excluded Shareholders had they been Qualifying Shareholders, the Company shall use its reasonable endeavours to procure that all or as many as possible of such Rights Shares are sold on the Stock Exchange nil paid at such a premium in excess of the expenses of sale as may reasonably be obtained as soon as reasonably practicable after the commencement of dealings in the Rights Shares (nil paid) but before the latest time for dealings in nil paid Rights Shares. The Company will distribute to the Excluded Shareholders the net proceeds of such sale of the Rights Shares (pro rata to their entitlement to Rights Shares had they been Qualifying Shareholders) except that a sum due to any Excluded Shareholder of less than HK$100 will not be distributed but will be retained, along with the proceeds of the sale of fractional entitlements, by the Company for its own use and benefit. In the event that such Rights Shares are not sold on the Stock Exchange, they will become part of the excess Rights Shares available for application by the Qualifying Shareholders.

The Company is in the process of seeking overseas legal advice on the exclusion of the Overseas Shareholders pursuant to Rule 13.36(2)(a) of the Listing Rules regarding the legal restrictions (if any) under the laws of the relevant places and the requirements of the relevant regulatory bodies or stock exchanges for the Company’s offering the Rights Issue to such Shareholders to determine who will be Excluded Shareholders. Further disclosure will be made by the Company in the Prospectus to be despatched to Shareholders on the Posting Date after it has formed the view as to whether or not the Rights Issue will be extended to the Overseas Shareholders.

Application for excess Rights Shares

Qualifying Shareholders shall be entitled to apply for (a) any unsold Rights Shares which would have been allotted to Excluded Shareholders had they been Qualifying Shareholders; (b) any Rights Shares provisionally allotted but not accepted by the Qualifying Shareholders. Application may be made by completing the form of application for excess Rights Shares and lodging the same with a separate remittance for the excess Rights Shares being applied for.

The Board will allocate the excess Rights Shares based on a sliding scale with reference to the number of the excess Rights Shares applied by them in pre-determined categories (i.e. Qualifying Shareholders belonging to pre-determined categories consisting of applications for smaller number of Rights Shares are allocated with a higher percentage of successful application but will receive less number of Rights Shares; whereas Qualifying Shareholders belonging to pre-determined categories consisting of applications for larger number of Rights Shares are allocated with a smaller percentage of successful application but will receive higher number of Rights Shares) and with the possibility of involving balloting which means some Qualifying Shareholders belonging to certain pre-determined categories may be allotted with some excess Rights Shares than others and those Qualifying Shareholders who are unsuccessful in the ballot may not receive any excess Rights Shares. Based on these, the Board considers such allocation basis to be fair and reasonable.

Shareholders with the Shares held by a nominee company should note that the Board will regard the nominee company as a single Shareholder according to the register of members of the Company. Accordingly, the Shareholders should note that the aforesaid arrangement in relation to the allocation of the excess Rights Shares will not be extended to beneficial owners individually. Shareholders with their Shares held by a nominee company are advised to consider whether they would like to arrange registration of the relevant Shares in the name of the beneficial owner(s) prior to the Record Date.

Application for listing

The Company will apply to the Listing Committee of the Stock Exchange for the listing of, and permission to deal in, the Rights Shares in both nil-paid and fully-paid forms. Nil-paid Rights Shares are expected to be traded in board lots of 1,000 (as the Shares are currently traded on the Stock Exchange in board lots of 1,000). Dealing in the Rights Shares (in both nil-paid and fully-paid forms) will be subject to the payment of stamp duty in Hong Kong.

Undertaking of Wharf

As at the date of this announcement, Wharf is, through its wholly-owned subsidiary, interested in 210,379,500 Shares, representing approximately 67% of the issued share capital of the Company. Pursuant to the Underwriting Agreement, Wharf has undertaken to the Company that, subject to the Rights Issue not being terminated, it will not, without the prior written consent of the Company, transfer or otherwise dispose of (including without limitation the creation of any option, charge or other encumbrances or rights over or in respect of) or acquire (except by taking up the Rights Shares) any Share or any interest therein at any time between the date of the Underwriting Agreement up to and including 4:00 p.m. on the first Business Day after the Acceptance Date. In addition, Wharf has also undertaken that it would place such number of Underwritten Shares to independent third parties to comply with the public float requirements under the Listing Rules in the event that the percentage of public float resulting from completion of the Rights Issue falls below the required minimum percentage under the Listing Rules in respect of the Company. Wharf will take appropriate steps/measures to ensure sufficient public float of the Shares upon completion of the Rights Issue.

Conditions of the Rights Issue

The obligations of the Underwriter under the Underwriting Agreement are conditional on the following, none of which can be waived, whether in whole or in part:

(i) completion of the Capital Increase (see the section headed “Proposed Capital Increase” below);

(ii) all necessary approvals, permits, waivers, consents and authorisations (including, without limitation, approval from the Shareholders in relation to the proposed Capital Increase for the Rights Issue) having been obtained for the provisional allotment and allotment of the Rights Shares as well as for the Rights Issue generally;

(iii) the Listing Committee of the Stock Exchange having granted (subject only to provisional allotment and/or allotment of the Rights Shares, the posting of the Rights Issue Documents and despatch of certificates in respect of the Rights Shares and any other matters which are agreed between the Company and Wharf as underwriter) the listing of and permission to deal in the Rights Shares (both in nil paid and fully paid form), and such listing and permission to deal not being subsequently revoked;

(iv) the registration of the Rights Issue Documents (with all the documents required to be attached thereto by Section 38D of the Companies Ordinance) (all having been duly authorised for registration by the Stock Exchange and signed by or on behalf of all Directors) by the Registrar of Companies in Hong Kong in compliance with the Companies Ordinance by no later than the Posting Date; and

(v) the posting of the Rights Issue Documents to the Qualifying Shareholders on or before the Posting Date.

In the event that the above conditions have not been satisfied on or before the time and dates specified in the Underwriting Agreement (or in each case such later date as Wharf and the Company may agree), all liabilities of the parties to the Underwriting Agreement shall cease and determine and none of the parties shall have any claim against the other save that the Company shall reimburse on demand Wharf such costs, charges and expenses of or incidental to the Rights Issue and the offer and issue of the Rights Shares and the matters contemplated by the Underwriting Agreement as agreed between the Company and Wharf in the Underwriting Agreement.

UNDERWRITING ARRANGEMENT

Underwriting Agreement

Date :5 February 2008

Underwriter : Wharf

Number of the Rights Shares : 157,500,000 Rights Shares

Number of Underwritten Shares : 52,310,250 Underwritten Shares

Commission : 1.25% of the Subscription Price of the Underwritten Shares

Termination of the Underwriting Agreement

If at any time between the date of the Underwriting Agreement and 5:00 p.m. on the second Business Day following the Acceptance Date one or more of the following events or matters (whether or not forming part of a series of events) shall occur, arise, or exist:-

(i) Wharf shall become aware of the fact that, or shall have reasonable cause to believe that, any of the Warranties was, when originally given or when repeated as provided in the Underwriting Agreement, untrue, inaccurate misleading or breached, and in each case the same is (in the reasonable opinion of Wharf) material in the context of the Rights Issue; or

(ii) (a) any new law or regulation is enacted, or there is any change in existing laws or regulations or any change in the interpretation or application thereof by any court or other competent authority, whether in Hong Kong or elsewhere;

(b) any change in local, national or international financial, political, industrial or economic conditions;

(c) any change of an exceptional nature in local, national or international equity securities or currency markets;

(d) any local, national or international outbreak or escalation of hostilities, insurrection or armed conflict;

(e) any moratorium, suspension or material restriction on trading in securities generally on the Stock Exchange;

(f) any suspension in the trading of the Shares on the Stock Exchange for a continuous period of five (5) Business Days;

(g) any change or development involving a prospective change in taxation or exchange controls in Hong Kong or elsewhere which will or may materially and adversely affect the Group or a material proportion of the Shareholders in their capacity as such,

which event or events is or are in the reasonable opinion of Wharf: - (1) likely to have a material adverse effect on the business or financial or trading position or prospects of the Company or the Group; or (2) likely to have a material adverse effect on the success of the Rights Issue or the level of Rights Shares taken up; or (3) so material as to make it inappropriate, inadvisable or inexpedient to proceed further with the Rights Issue,

then Wharf may, in addition to and without prejudice to any other remedies to which Wharf may be entitled, by notice in writing to the Company terminate the Underwriting Agreement forthwith.

CHANGES IN THE SHAREHOLDING STRUCTURE OF THE COMPANY ARISING FROM THE RIGHTS ISSUE

The changes in the shareholding structure of the Company arising from the Rights Issue are as follows:

	As at the date of this announcement		Shareholding upon completion of the Rights Issue
			0% acceptance by the Shareholders other than Wharf		100% acceptance by all Shareholders
	No. of Shares	%	No. of Shares	%	No. of Shares	%
Wharf (Note 1)	210,379,500	66.79	367,879,500	77.86	315,569,250	66.79
Public shareholders:
Harson Investment Limited (Note 3)	25,357,500	8.05	25,357,500	5.37	38,036,250	8.05
Other public Shareholders	79,263,000	25.16	79,263,000	16.77	118,894,500	25.16
Sub-total	104,620,500	33.21	104,620,500	22.14 (Note 2)	156,930,750	33.21
Total	315,000,000	100.00	472,500,000	100.00	472,500,000	100.00

Note:

1. Wharf is, through its wholly-owned subsidiary, namely Upfront International Limited, interested in 66.79% shareholding interest in the Company. Wharf is a non wholly-owned subsidiary of Wheelock and Company Limited holding (whether directly or indirectly) approximately 50.02% shareholding interest in Wharf after completion of the rights issue exercise in January 2008.
2. Wharf has undertaken to comply with the public float requirement under the Listing Rules. For detail, please refer to the section headed “Restoration of Public Float” below.
3. Harson Investment Limited, who is not associated and has no connection with Wharf or its Associates, is an independent third party.

RESTORATION OF PUBLIC FLOAT

As shown under the section headed “Changes in the shareholding structure of the Company arising from the Rights Issue” above, immediately upon the completion of the Rights Issue, assuming no Rights Issue Shares is taken up by the Shareholders other than Wharf, the public float of the Company will decrease to approximately 22.14%. In this regard, Wharf has undertaken that it would place such number of Underwritten Shares to independent third parties to comply with the public float requirements under the Listing Rules in the event that the percentage of public float resulting from completion of the Rights Issue falls below the required minimum percentage under the Listing Rules in respect of the Company. Wharf will take appropriate steps/measures to ensure sufficient public float of the Shares upon completion of the Rights Issue.

EXPECTED TIMETABLE

Last day of dealings in the Shares on a cum-rights basis ………………….19 February 2008

Commencement of dealings in the Shares on an ex-rights basis……….... 20 February 2008

Latest time for lodging transfer of the Shares in order

to be qualified for the Rights Issue..………………………...4:30 p.m. on 21 February 2008

Register of members closes ………........................ 22 February 2008 to 26 February 2008

(both dates inclusive)

Record Date ……………………………………………………………………..26 February 2008

Register of members re-opens………………………………………………...27 February 2008

Despatch of the Rights Issue Documents………………………………………..3 March 2008

First day of dealings in nil-paid Rights Shares……………………………………5 March 2008

Latest time for splitting nil-paid Rights Shares…………………….4:30 p.m. on 7 March 2008

Last day of dealings in nil-paid Rights Shares……………..…………………....12 March 2008

Latest time for acceptance of, and payment for,

the Rights Shares and application for

excess Rights Shares…………………………………………4:00 p.m. on 17 March 2008

Underwriting Agreement becomes unconditional…………….....5:00 p.m. on 19 March 2008

Announcement of results of the Rights Issue to be published

in the respective websites of the Stock Exchange and the Company

on or before …………………………………………………… …... ………. 25 March 2008

Refund cheques in respect of wholly or partially unsuccessful

applications for excess Rights Shares expected to be posted

on or before………………………….........................................................25 March 2008

Certificates for the Rights Shares expected

to be despatched on or before………………………………………….………25 March 2008

Dealings in fully-paid Rights Shares commence.………………………………27 March 2008

Dates or deadlines specified in this announcement are indicative only and may be varied by agreement between the Company and Wharf. Any consequential changes to the expected timetable will be published or notified to Shareholders appropriately.

WARNING OF THE RISKS OF DEALING IN THE SHARES AND THE NIL-PAID RIGHTS SHARES

Existing shares will be dealt with on an ex-rights basis from 20 February 2008. The Rights Shares will be dealt with in their nil-paid form from 5 March 2008 to 12 March 2008 (both dates inclusive). If prior to 5:00 p.m. on the second Business Day following the Acceptance Date, Wharf terminates the Underwriting Agreement (see sub-section headed “Termination of the Underwriting Agreement” above) or the conditions of the Rights Issue (see sub-section headed “Conditions of the Rights Issue” above) cannot be fulfilled, the Rights Issue will not proceed. Any dealings in the Shares from the date of this announcement up to the date on which all the conditions of the Rights Issue are fulfilled, and any dealings in the Rights Shares in their nil-paid form between 5 March 2008 and 12 March 2008, both dates inclusive, are accordingly subject to the risk that the Rights Issue may not become unconditional or may not proceed. Shareholders and potential investors should therefore exercise caution when dealing in the Shares or Rights Shares in their nil-paid form, and if they are in any doubt about their position, they are recommended to consult their professional adviser.

REASONS FOR THE RIGHTS ISSUE AND USE OF PROCEEDS

The Group has since 2007 embarked on a substantial business initiative in expanding its property investment in China and has, solely or through joint ventures, succeeded in acquiring several sites in four different cities in China mainland since September 2007. The Group’s land bank in China is currently over 23 million square feet and the Group continues to seek investment opportunities in China in the near future. The Group’s initiative to expand into properties in the mainland is a strategic undertaking and a long-term commitment. These new investments will open a new and exciting frontier to the Group and its shareholders in future. It is prudent business practice that expansion is suitably anchored by financial solidarity. Hence a rights issue is proposed.

The estimated net proceeds of the Rights Issue of approximately HK$2,000 million will be applied by the Group to meet its capital requirements arising from this initiative.

EQUITY FUND RAISING ACTIVITIES OF THE COMPANY DURING THE PAST 12 MONTHS

The Company has not engaged in or initiated any equity fund raising exercises during the past 12 months immediately before the date of this announcement or any rights issue exercise prior to such 12-month period but the dealing in respect of the shares issued pursuant to such rights issue exercise commenced within the 12-month period.

PROPOSED CAPITAL INCREASE

In order to facilitate the Rights Issue and provide for the future expansion in the share capital of the Company, the Board proposes that, subject to the conditions set out below, the authorised share capital of the Company be increased from HK$190,000,000 to HK$600,000,000 by the creation of an additional 820,000,000 Shares.

The Capital Increase will be conditional upon passing by the Shareholders of an ordinary resolution approving the Capital Increase at the Extraordinary General Meeting.

GENERAL

The principal business activities of the Group are ownership of hotels and properties and investment.

The Prospectus containing, among other things, further details of the Rights Issue is expected to be despatched by the Company to the Qualifying Shareholders and for information only, to the Excluded Shareholders on the Posting Date. The provisional allotment letters and the forms of application for excess Rights Shares will also be sent to the Qualifying Shareholders on the same date.

A circular containing details of the Capital Increase and a notice convening the Extraordinary General Meeting will be despatched to the Shareholders in due course.

As at the date of this announcement, the board of directors of the Company comprises Mr. Gonzaga W. J. Li, Mr. T. Y. Ng and Mr. Clement K. H. Wong, together with three independent non-executive directors, namely, Mr. H. M. V. de Lacy Staunton, Mr. Michael T. P. Sze and Mr. M. K. Tan.

Definitions

Unless the context otherwise requires, capitalised terms used in this announcement shall have the following meanings :-

“Acceptance Date”	17 March 2008, being the last day for acceptance and payment of the Rights Shares, or such other date as the Company and Wharf may agree in writing
“Associates”	shall have the meaning as ascribed to it under the Listing Rules
“Board”	the board of Directors
“Business Day”	a day (excluding Saturdays) on which banks are generally open for business in Hong Kong
“Capital Increase”	the proposed increase in the authorised share capital of the Company as referred to in the section headed “Proposed Capital Increase”
“Company”	Harbour Centre Development Limited (stock code: 51), a company incorporated under the laws of Hong Kong and the shares of which are listed on the Main Board. It is a 67%-owned subsidiary of Wharf
“Companies Ordinance”	Companies Ordinance (Chapter 32 of the Laws of Hong Kong)
“Directors”	directors of the Company
“Excluded Shareholder(s)”	Overseas Shareholder(s) to whom the Directors, based on legal opinions provided by legal advisers, consider it necessary or expedient not to offer the Rights Shares on account either of legal restrictions under the laws of the relevant place or the requirements of the relevant regulatory body or stock exchange in that place
“Extraordinary General Meeting”	the extraordinary general meeting of the Company to be convened on 3 March 2008 for approval by the Shareholders of the proposed Capital Increase
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s Republic of China
“Listing Committee”	has the meaning ascribed thereto in the Listing Rules
“Listing Rules”	the Rules Governing the Listing of Securities on the Stock Exchange
“Main Board”	the stock exchange (excluding the option market) operated by the Stock Exchange which is independent from and operated in parallel with the Growth Market of the Stock Exchange
“Overseas Shareholders”	Shareholder(s) whose names appear on the register of members of the Company as at the close of business on the Record Date and whose address(es) as shown on such register is/are outside Hong Kong
“Posting Date”	3 March 2008 or such other date as Wharf may agree in writing with the Company for the despatch of the Rights Issue Documents
“Prospectus”	the prospectus to be issued by the Company in relation to the Rights Issue
“Qualifying Shareholder(s)”	Shareholder(s) whose name(s) appear on the register of members of the Company as at the close of business on the Record Date, other than the Excluded Shareholders
“Record Date”	26 February 2008, the record date to determine entitlements to the Rights Issue
“Rights Issue”	the issue of 157,500,000 Rights Shares at the Subscription Price on the basis of one Rights Share for every two existing Shares held on the Record Date payable in full on acceptance
“Rights Issue Documents”	the Prospectus, the provisional allotment letters and the forms of application for excess Rights Shares to be issued by the Company
“Rights Share(s)”	new Share(s) to be allotted and issued in respect of the Rights Issue
“PRC”	the People’s Republic of China
“Share(s)”	ordinary share(s) of HK$0.5 each in the share capital of the Company
“Shareholder(s)”	holder(s) of the Shares
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Subscription Price”	the subscription price of HK$12.80 per Rights Share
“Underwriting Agreement”	the underwriting agreement entered into between the Company and Wharf dated 5 February 2008 in relation to the Rights Issue
“Underwritten Shares”	52,310,250 Rights Shares fully underwritten by Wharf on and subject to terms and conditions as set out in the Underwriting Agreement
“Warranties”	the representations, warranties and undertakings contained in the Underwriting Agreement
“Wharf”	The Wharf (Holdings) Limited (stock code: 4), a company incorporated in Hong Kong with limited liability and whose shares are listed on the Main Board
“HK$”	Hong Kong dollar, the lawful currency of Hong Kong
“%”	per cent.

By order of the Directors of HARBOUR CENTRE DEVELOPMENT LIMITED Wilson W. S. Chan Company Secretary

Hong Kong, 5 February 2008

All Directors jointly and severally accept full responsibility for the accuracy of information contained in this announcement and confirm, having made all reasonable inquires, that to the best of their knowledge, opinions expressed in this announcement have been arrived at after due and careful consideration and there are no other facts not contained in this announcement, the omission of which would make any statement in this announcement misleading.