Item 1. Legal Proceedings
ITEM 1. LEGAL PROCEEDINGS.
As of September 30, 2024, the Company involved
with various legal proceedings:
Action Case: HCA702/2018 On March 27, 2018,
the writ of summons was issued against the Company and seven related companies of the former shareholder by the Plaintiff. This action
alleged the infringement of certain registered trademarks currently registered under the Plaintiff. On February 23, 2023, the Court granted
leave for this action be set down for trial of 13 days, and the trial will commence on November 25, 2024. Legal counsel of the Company
will continue to handle in this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome of
the matter or the range of reasonably possible loss, if any.
Action Case: HCA765/2019 On April 30, 2019,
the writ of summons was issued against the Company’s subsidiary, three related companies and the former directors, shareholders
and financial consultant by the Plaintiff. This action alleged the deceit and misrepresentation from an inducement of the fund subscription
and claimed for compensatory damage of approximately $2 million (equal to HK$17.1 million). On April 18, 2024, the court made an order
that the plaintiff shall set the case down for trial on or before July 6, 2024 for a 7 days trial before a judge and there shall be a
pre-trial review before the trial judge on a date 12 weeks before the trial. The plaintiff and the defendants agreed on a time extension
until August 8, 2024 to set the case down for trial. On August 9, 2024, the Court made an order that the case be adjourned to January
14, 2025 for another case management conference. The case is on-going and parties have yet to attempt mediation. Legal counsel of the
Company will continue to handle this matter. At this stage in the proceedings, it is unable to determine the probability of the outcome
of the matter or the range of reasonably possible loss, if any.
Action Case : HCA2097 and 2098/2020 On
December 15, 2020, the writs of summons were issued against the Company and the former consultant by the Plaintiff. This action alleged
the misrepresentation and conspiracy causing the loss from the investment in corporate bond and claimed for compensatory damage of approximately
$1.67 million (equal to HK$13 million). The Company previously made $0.84 million as contingency loss for the year ended December 31,
2021. Parties participated in a mediation held on March 25, 2022 and negotiated for settlement through without prejudice correspondence,
no settlement was reached. The case is on-going and legal counsel of the Company will continue to handle this matter. At this stage in
the proceedings, it is unable to determine the probability of the outcome of the matter or the range of reasonably potential loss, if
any.
ITEM 1A. RISK FACTORS.
As smaller reporting company we are not required
to make disclosures under this Item.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES,
USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
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