PUBLIC CENSURE ANNOUNCEMENT
in respect of
Mr. Yu Kwok Leung, Mr. Lam To Ming and Mr. So Chee Keung
(collectively, the "Former Directors")
(formerly, directors of Q-Tech Holdings Limited)
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The Stock Exchange of Hong Kong hereby publicly censures each of Mr. Yu Kwok Leung Mr. Lam To Ming and Mr. So Chee Keung for breaches of each of their Declarations and Undertakings with regard to Directors given by them to the Exchange in the form set out in Appendix 5B of the Exchange Listing Rules (the "Undertaking") respectively.
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The Listing Committee of the Exchange has recently concluded a disciplinary hearing into the conduct of Q-Tech Holdings Limited and certain directors of the Company including Mr. Yu Kwok Leung, Mr. Lam To Ming and Mr. So Chee Keung in connection with, amongst other things, failure to publish details of a change of use in the proceeds of the issue of the Company (the "Issue") in a timely manner as required under the Listing Agreement and failure to publish the Company's annual report and accounts within the time frame stipulated by the Listing Agreement.
On September 26, 1998 the Company made an announcement, published on September 28, 1998, in which it stated that as a result of the financial turmoil being experienced in Asia, the Company had deferred plans to open showrooms in the People's Republic of China as advised in the prospectus dated December 30, 1997, and had instead utilised approximately HK$37 million of the money raised by the Issue as security for trade lines used by the Company. However, it subsequently transpired that a further change of use of the proceeds of the Issue had been made in October and November 1998, whereby HK$33 million had been applied to offset indebtedness and reduce interest payments due by the Company. Details of this further change in proceeds were not disclosed by the Company until the announcement of the Company dated January 21, 1999 was published on January 22, 1999, some four months later. The Company and the board of directors at the relevant time conceded in the announcement dated January 21, 1999 a breach of the Listing Rules.
The Listing Committee has found, after considering all the relevant submissions from both the Listing Division, the Company and the relevant directors of the Company including the Former Directors that the Company failed to comply with Paragraph 2 of the Listing Agreement by failing to disclose in October and November 1998 the further change of application of a substantial portion of the proceeds of the Issue.
The Listing Committee has also found that as a result of the said breach of Paragraph 2 of the Listing Agreement by the Company, each of the Former Directors acted in breach of their individual Undertaking to the Exchange to comply with the Listing Rules to the best of their abilities and to use their best endeavours to procure that the Company so complies.
In addition, the Listing Committee has found after considering submissions from both the Listing Division, the Company and the relevant directors of the Company including the Former Directors that the Company has also failed to comply with Paragraph 8 of the Listing Agreement, which required the Company to announce its annual results and to dispatch its annual report to shareholders by no later than November 30 of each year and make up its annual report to a date falling not more than six months before its annual general meeting, which in the case of the Company was required to be held no later than December 31 of each year. The Company was unable to comply with these requirements for the financial year ended June 1998. Two announcements to this effect were made by the Company dated November 28, 1998 and January 27, 1999 and published on November 30, 1998 and January 28, 1999 respectively. In the announcement published on January 28, 1999, the Company conceded a breach of the Listing Agreement had occurred. The annual results of the Company were ultimately dated February 12, 1999 and published on February 15, 1999, and the Company's annual general meeting held on March 31, 1999.
As a result of the further breach of Paragraph 8 of the Listing Agreement by the Company, the Listing Committee has also found that each of the Former Directors acted in breach of their individual Undertakings to the Exchange to comply with the Listing Rules to the best of their abilities and to use their best endeavours to procure that the Company so complies.
Accordingly, each of Mr. Yu Kwok Leung, Mr. Lam To Ming and Mr. So Chee Keung is hereby publicly censured by the Listing Committee for breaches of their respective Undertakings.
For the avoidance of doubt, the Exchange confirms that it is hereby only publicly censuring Mr. Yu Kwok Leung, Mr. Lam To Ming and Mr. So Chee Keung in relation to this matter.
Corporate Communications Department