periods of three years thereafter unless either party to Agreement. N.A.H. Fenwick and M.B. Swire are so it gives to the other notice of termination of not less interested as shareholders, directors and/or employees than three months expiring on any 31st December. of Swire. Particulars of the fees paid and the expenses The Independent Non-Executive Directors of the Company, reimbursed for the year ended 31st December 2022 who are not interested in any connected transactions with are given in note 42 to the financial statements. the Group, have reviewed and confirmed that the continuing connected transactions as set out above have (b) Tenancy Framework Agreement been entered into by the Group in the ordinary and usual The Company, JS&SHK and Swire Pacific Limited course of business of the Group, on normal commercial (“Swire Pacific”) entered into a tenancy framework terms or better, and according to the agreements governing agreement (“Tenancy Framework Agreement”) on them on terms that are fair and reasonable and in the 14th August 2014 to govern existing and future interests of the shareholders of the Company as a whole. tenancy agreements between members of the Group, The auditors of the Company have also reviewed these members of the JS&SHK group and members of the transactions and confirmed to the Board that nothing has Swire Pacific group. The Tenancy Framework come to their attention that causes them to believe that Agreement, which took effect from 1st January 2014 they have not been approved by the Board of the and was renewed on 1st October 2015 and 1st October Company; that they were not, in all material respects, in 2018, was renewed again on 1st October 2021 for a accordance with the pricing policies of the Group if the term of three years from 1st January 2022 to 31st transactions involve the provision of goods or services by December 2024. It is renewable for successive periods the Group; that they were not entered into, in all material of three years thereafter unless any party to it gives to respects, in accordance with the relevant agreements the other parties notice of termination of not less than governing the transactions; and that the relevant annual three months expiring on any 31st December. Pursuant caps have been exceeded. to the Tenancy Framework Agreement, members of the Group, members of the JS&SHK group and Discloseable Transactions members of the Swire Pacific group enter into tenancy agreements from time to time on normal commercial (a) Formation of a Joint Venture for the terms based on prevailing market rentals. Acquisition and Development of Land For the year ended 31st December 2022, the in Xi’an aggregate rentals payable to the Group under On 4th March 2022, Chance Ascent Limited (“Chance tenancies subject to the Tenancy Framework Ascent”), an indirect wholly-owned subsidiary of the Agreement totalled HK$147 million. Company, formed a project company (the “Project At 31st December 2022, the Swire group was interested in Company”) with Xi’an Cheng Huan Cultural Investment 59.78% of the equity of Swire Pacific and controlled 67.64% and Development Co., Ltd. to acquire the land use of the voting rights attached to shares in Swire Pacific and rights in respect of land (the “Target Land”) located in Swire Pacific owned 82.00% of the Company’s total number the Beilin district of Xi’an for a consideration of of issued shares. JS&SHK, as a wholly-owned subsidiary of RMB2,575 million. The Project Company will acquire Swire, and Swire Pacific are therefore connected persons of and hold such land use rights and will be principally the Company under the Listing Rules. The transactions engaged in the development of the Target Land. under the Services Agreement and the Tenancy Framework Chance Ascent has a 70% interest in the Project Agreement are continuing connected transactions in Company and is obliged to contribute approximately respect of which announcements dated 11th August 2022 RMB2,558 million to its registered capital. Chance and 13th May 2021 respectively were published. Ascent’s total capital commitment to the acquisition and development of the Target Land is estimated to be As directors and/or employees of (or in one case as an RMB7,000 million. The formation of the Project adviser to) the Swire group, T.J. Blackburn, G.M.C. Bradley, Company constituted a discloseable transaction for R.S.K. Lim, F.N.Y. Lung and M.J. Murray are interested in the the Company under the Listing Rules, in respect of Services Agreement and the Tenancy Framework which an announcement dated 4th March 2022 was published. 119 SWIRE PROPERTIES ANNUAL REPORT 2022