Form 20-F - Annual and transition report of foreign private issuers [Sections 13 or 15(d)]

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 20-F

 

(Mark one)

 

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

 

OR

 

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2023

 

OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

OR

 

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of event requiring this shell company report:

 

For the transition period from __________ to ____________

 

Commission file number: 001-42016

 

Neo-Concept International Group Holdings Limited

(Exact name of the Registrant as specified in its charter)

 

N/A

(Translation of registrant’s name into English)

 

Cayman Islands

(Jurisdiction of incorporation or organization)

 

10/F, Seaview Centre
No.139-141 Hoi Bun Road
Kwun Tong
Kowloon, Hong Kong
(Address of principal executive offices)

 

Patrick Kwok Fai Lau

Tel: [phone]

Email: [e-mail]

10/F, Seaview Centre
No.139-141 Hoi Bun Road
Kwun Tong Kowloon, Hong Kong

(Name, Telephone, E-mail and Address of Company Contact Person)

 

Securities registered or to be registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Ordinary shares, par value $0.0000625 per share		NCI		The Nasdaq Capital Market, LLC

 

Securities registered or to be registered pursuant to Section 12(g) of the Act:

 

Warrants, each to purchase one ordinary share

Title of Class

 

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

 

None

 

 

 

The registrant had 18,000,000 ordinary shares issued and outstanding as of December 31, 2023.

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

 

☐ Yes ☒ No

 

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

 

 ☐ Yes ☒ No

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

☒ Yes ☐ No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

 

☒ Yes ☐ No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

☐ Large Accelerated filer		☐ Accelerated filer		☒ Non-accelerated filer
				☒ Emerging growth company

 

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

 

†

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

 

☒ U.S. GAAP

☐ International Financial Reporting Standards as issued by the International Accounting Standards Board

☐ Other

 

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

 

☐ Item 17 ☐ Item 18

 

If this is an Annual Report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

☐ Yes ☒ No

 

 

 

 

 

TABLE OF CONTENTS

 

FORWARD-LOOKING STATEMENTS		iii
DEFINITIONS		iv
PART I		1
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS		1
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE		1
ITEM 3. KEY INFORMATION		1
B. Capitalization and Indebtedness.		1
C. Reason for the Offer and Use of Proceeds.		1
D. Risk Factors.		1
ITEM 4. INFORMATION ON THE COMPANY		21
A. History and Development of the Company.		21
B. Business overview.		22
C. Organizational structure.		35
D. Property, plant and equipment.		36
ITEM 4A. UNRESOLVED STAFF COMMENTS		37
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS		37
A. Results of operations.		37
B. Liquidity and capital resources.		43
C. Research and development, patents and licenses, etc.		46
D. Trend information.		46
E. Critical accounting estimates		46
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES		47
A. Directors and senior management.		47
B. Compensation.		49
C. Board Practices.		50
D. Employees.		52
E. Share Ownership.		52
F. Disclosure of a registrant’s action to recover erroneously awarded compensation.		53
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS		54
A. Major Shareholders.		54
B. Related Party Transactions.		54
C. Interests of Experts and Counsel		57
ITEM 8. FINANCIAL INFORMATION		57
A. Consolidated Statements and Other Financial Information.		57
B. Significant Changes.		58
ITEM 9. THE OFFER AND LISTING		58
A. Offer and Listing Details.		58
B. Plan of Distribution.		58
C. Markets.		58
D. Selling Shareholders.		58
E. Dilution.		58
F. Expenses of the Issue.		58

 

i

 

 

ITEM 10. ADDITIONAL INFORMATION	58
A. Share Capital.	58
B. Memorandum and Articles of Association.	58
C. Material Contracts.	64
D. Exchange controls.	64
E. Taxation.	64
F. Dividends and paying agents.	66
G. Statement by experts.	66
H. Documents on display.	66
I. Subsidiary Information	66
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK	66
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES	67
PART II	68
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES	68
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS	68
ITEM 15. CONTROLS AND PROCEDURES	68
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT	69
ITEM 16B. CODE OF ETHICS	69
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES	69
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES	70
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS	70
ITEM 16F. CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT	70
ITEM 16G. CORPORATE GOVERNANCE	70
ITEM 16H. MINE SAFETY DISCLOSURE	70
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTION THAT PREVENT INSPECTIONS	70
PART III	71
ITEM 17. FINANCIAL STATEMENTS	71
ITEM 18. FINANCIAL STATEMENTS	71
ITEM 19. EXHIBITS	71
REPORTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS	F-2
CONSOLIDATED BALANCE SHEETS	F-3
CONSOLIDATED STATEMENTS OF OPERATIONS	F-4
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY	F-5
CONSOLIDATED STATEMENTS OF CASH FLOWS	F-6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	F-7

 

ii

 

 

FORWARD-LOOKING STATEMENTS

 

This Annual Report contains forward-looking statements that involve substantial risks and uncertainties. These forward-looking statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “goal,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. The forward-looking statements and opinions contained in this Annual Report are based upon information available to us as of the date of this Annual Report and, while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information.

 

Forward-looking statements include statements about:

 

	●	timing of the development of future business;
	●	capabilities of our business operations;
	●	expected future economic performance;
	●	competition in our market;
	●	continued market acceptance of our services and products;
	●	protection of our intellectual property rights;
	●	changes in the laws that affect our operations;
	●	inflation and fluctuations in foreign currency exchange rates;
	●	our ability to obtain and maintain all necessary government certifications, approvals, and/or licenses to conduct our business;
	●	continued development of a public trading market for our securities;
	●	the cost of complying with current and future governmental regulations and the impact of any changes in the regulations on our operations;
	●	managing our growth effectively;
	●	projections of revenue, earnings, capital structure and other financial items;
	●	fluctuations in operating results;
	●	dependence on our senior management and key employees; and
	●	the impact of widespread health developments, including the COVID-19 pandemic, and the responses thereto (such as voluntary and in some cases, mandatory quarantines as well as shut downs and other restrictions on travel and commercial, social and other activities, and the availability of effective vaccines or treatments) and the impact of economies reopening further to the COVID-19 pandemic.

 

These statements are subjective. Therefore, they involve known and unknown risks.

 

iii

 

 

They are based largely on our current expectations and projections about future events and financial trends, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results to differ materially from any future results, performance or achievements described in or implied by such statements. Actual results may differ materially from expected results described in our forward-looking statements, for reasons connected with measuring future developments, including:

 

	1.	the correct measurement and identification of factors affecting our business;
	2.	the extent of their likely impact; and/or
	3.	the accuracy and completeness of the publicly available information regarding the factors upon which our business strategy is based.

 

Forward-looking statements should not be read as a guarantee of future performance or results. They will not necessarily be accurate indications of whether, or the times by which, our performance or results may be achieved. Forward-looking statements are based on information available at the time those statements are made and management’s belief as of that time regarding future events. Consequently, they are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements.

 

Important factors that could cause actual performance or results to differ materially from those contained in forward-looking statements include, but are not limited to, those factors discussed under Item 3.D. “Risk Factors,” that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

 

DEFINITIONS

 

Unless otherwise indicated and except where the context otherwise requires, the following definitions are used in this Annual Report:

 

“Articles’’ or “Articles of Association’’ are to the amended and restated articles of association of our Company (as amended from time to time) effective upon the listing of our Ordinary Shares on the Nasdaq Capital Market, and as amended, supplemented and/or otherwise modified from time to time.

 

●

“BVI” are to the British Virgin Islands.

 

●

“China” or “PRC” are to the People’s Republic of China including Hong Kong, Macau and, excluding, for the purpose of this report, Taiwan.

 

●

“Companies Act” are to the Companies Act (as revised) of the Cayman Islands, as amended, supplemented or otherwise modified from time to time.

 

●

“Company”, “we”, “us”, “our” and “NCI” are to Neo-Concept International Group Holdings Limited, an exempted company incorporated in the Cayman Islands with limited liability under the Companies Act on July 29, 2021, that will issue the Ordinary Shares being offered.

 

●

“Controlling Shareholder” are to Ms. Eva Yuk Yin Siu, who beneficially owns an aggregate of 14,526,355 Ordinary Shares, which represents 71.5% of the total issued and outstanding Shares.

 

●

“COVID-19” are to the Coronavirus Disease 2019.

 

●

“Europe” are to the European Union, excluding the UK.

 

●

“Exchange Act” are to the U.S. Securities Exchange Act of 1934, as amended.

 

iv

 

 

●

“IPO” are to an initial public offering of securities by the Company of 2,320,000 ordinary shares, par value $0.0000625 per share.

 

●

“HKD” or “HK$” are to Hong Kong dollar(s), the lawful currency of Hong Kong.

 

●

“Hong Kong” are to the Hong Kong Special Administrative Region of the People’s Republic of China.

 

●

“GBP” or “£” are to pound sterling, the lawful currency of the UK.

 

●

“Independent Third Party” are to a person or company who or which is independent of and is not a 5% owner of, does not control and is not controlled by or under common control with any 5% owner and is not the spouse or descendant (by birth or adoption) of any 5% owner of the Company.

 

●

“Macau” are to the Macau Special Administrative Region of the People’s Republic of China.

 

●

“Mainland China” are to the PRC or China excluding, for the purpose of this report only, Hong Kong, Macau and Taiwan.

 

●

“Memorandum’’ or “Memorandum of Association’’ are to the amended and restated memorandum of association of our Company (as amended from time to time) effective upon listing of our Ordinary Shares on the Nasdaq Capital Market, and as amended, supplemented and/or otherwise modified from time to time.

 

●

“NCA” are to Neo-Concept Apparel Group Limited, a BVI business company limited by shares incorporated in the BVI, a direct wholly-owned subsidiary of NCI.

 

●

“NCH” are to Neo-Concept (Holdings) Company Limited, a company incorporated in Hong Kong with limited liability in 1990 as a comprehensive garment service solution provider and which in 2021, pursuant to a plan of reorganization, spun off its subsidiaries Neo-Concept HK and Neo-Concept UK to NCI.

 

●

“NCI Group” are to the Company and its subsidiaries, NCA, Neo-Concept HK and Neo-Concept UK.

 

●

“Neo Concept Group” are to the Parent Group and its subsidiaries including NCH but excluding the NCI Group.

 

●

“Neo-Concept (BVI) Limited” are to “Neo-Concept (BVI) Limited, a BVI business company limited by shares incorporated in the BVI, and the holding company of 82.01% of the Ordinary Shares as at the date of this report.

 

●

“Neo-Concept HK” are to Neo-Concept International Company Limited, a company incorporated in Hong Kong with limited liability, an indirect wholly owned subsidiary of NCI and our key operating subsidiary in Hong Kong.

 

●

“Neo-Concept UK” are to Neo-Concept (UK) Limited, a company incorporated in the UK with limited liability, an indirect wholly owned subsidiary of NCI and our operating subsidiary in the UK.

 

●

“Operating Subsidiaries” are to Neo-Concept HK and Neo-Concept UK.

 

●

“Ordinary Shares” or “Shares” are to our shares, par value $0.0000625 per share.

 

●

“PRC” or “China” are to the People’s Republic of China including Hong Kong, Macau and, excluding, for the purpose of this report, Taiwan.

 

●

“Parent Group” are to Neo-Concept (BVI) Limited, Ample Excellence Limited, and Splendid Vibe Limited.

 

●

“SEC” or “Securities and Exchange Commission” are to the United States Securities and Exchange Commission.

 

●

“Securities Act” are to the U.S. Securities Act of 1933, as amended.

 

●

“U.S. dollars” or “US$” or “USD” or “dollars” are to United States dollar(s), the lawful currency of the United States.

 

●

“UK” are to the United Kingdom.

 

v

 

 

PART I

 

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

 

Not applicable.

 

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

 

Not applicable.

 

ITEM 3. KEY INFORMATION

 

B. Capitalization and Indebtedness.

 

Not applicable.

 

C. Reason for the Offer and Use of Proceeds.

 

Not applicable.

 

D. Risk Factors.

 

You should carefully consider all the information in this Annual Report, including various changing regulatory, competitive, economic, political and social risks and conditions described below, before making an investment in our ordinary shares. One or more of a combination of these risks could materially impact our business, results of operations and financial condition. In any such case, the market price of our ordinary shares could decline, and you may lose all or part of your investments.

 

1

 

 

Risks Relating to Our Corporate Structure

 

Our transactions with NCH may be less favorable to us than similar agreements negotiated with unaffiliated third parties.  

 

During the three years ended December 31, 2023, 2022 and 2021, we entered into a series of transactions with an affiliated company under the control of our Controlling Shareholder, NCH. These transactions include engaging NCH as a contract manufacturer to produce certain apparel products for our customers. The terms of such transactions may be less favorable to us than would be the case if they were negotiated with unaffiliated third parties. Because we will be a “controlled company” the terms of such future transactions will be reviewed by the Audit Committee to ensure that they will not be less favorable to us than would be the case if they were negotiated with unaffiliated third parties. Moreover, so long as we are under the control of the Controlling Shareholder, their influence may make it difficult for us to bring a legal claim against NCH in the event of contractual breach, notwithstanding our contractual rights under the transactions and other agreements we may enter into with NCH or other affiliated companies under the control of our Controlling Shareholder from time to time.

 

Our business is in direct competition with NCH, an affiliated company.

 

NCH also operates as a comprehensive apparel solutions services provider in North America and Europe principally. As such, NCH is in direct competition with our business in such regions. To address this, we entered into an Exclusive Territory and Non-Competition Agreement (“Agreement”) with Neo-Concept (BVI) Limited, Ample Excellence Limited and Splendid Vibe Limited (collectively the “Parent Group”), the holding companies of NCH and other subsidiaries under the common control of our Controlling Shareholder. Under the Agreement we entered into with the Parent Group, we have agreed that during the non-competition period (which will end on the later of (1) two years after the first date when our Controlling Shareholder ceases to own in aggregate at least 20% of the voting power of our then outstanding securities and (2) the fifth anniversary of the completion of the Company’s IPO) that the Parent Group and its subsidiaries, including NCH but excluding NCI Group) (the “Neo Concept Group”), will not compete with our Company in the businesses currently conducted by us through our Operating Subsidiaries in North America and Europe namely, in the businesses of apparel solution services in the UK, Europe and North America (the “Protected Territories”) and retail sale of apparel products. However, since we are in the process of and have not yet obtained all of the certifications required by certain clients to guarantee that their raw material sourcing meets international standards we have agreed that the Neo Concept Group shall continue to service its existing portfolio of customers in the Protected Territories that require the additional certifications provided that once NCI Group obtains and provides documentation that the necessary certifications required by a Portfolio Customer have been secured, Neo Concept Group will use its best endeavors to transfer within 45 days the Portfolio Customers to NCI Group. In the event that Neo Concept Group is unable, unsuccessful or a Portfolio Customer is unwilling to transfer its account to NCI Group, then NCI Group shall be entitled to receive the economic benefit inuring to Neo Concept Group from that Portfolio Customer as measured by a royalty of 10% of all sales and services by Neo Concept Group to that Portfolio Customer.

 

2

 

 

As of the date of this report, we have a total of twenty customers which we provide apparel solution services to, each of which are not current clients of NCH and are therefore protected under the terms of the Agreement. Under the terms of the Agreement, we retain the right to sell to any of NCH’s existing portfolio of customers.

 

However, so long as our Controlling Shareholder continue to control us, we may not be able to bring a legal claim against NCH in the event of contractual breach, notwithstanding our contractual rights under the Agreement described above and other inter-company transactions entered into from time to time.

 

Our Controlling Shareholder has significant voting power and may take actions that may not be in the best interests of other shareholders.

 

Our Controlling Shareholder, owns 71.5% of the total issued and outstanding Ordinary Shares, representing 71.5% of the total voting power. Because the Controlling Shareholder will control a majority of our outstanding voting power, we will be a “controlled company” under corporate governance rules for NASDAQ-listed companies. Therefore, the Controlling Shareholder will be able to exert significant control over our management and affairs requiring shareholder approval, including approval of significant corporate transactions. Since the Controlling Shareholder is also a Controlling Shareholder of NCH, which is in direct competition with our business in certain regions and creates potential conflicts of interest, this concentration of ownership may not be in the best interests of all of our shareholders.

 

Our Controlling Shareholder’s relationship with Neo-Concepts (BVI) Limited may result in strategic business decisions that favor our Controlling Shareholder rather than the interests of our other shareholders.

 

Although our company is a stand-alone company, we expect to operate, for as long as our Controlling Shareholder is our controlling shareholder, as an affiliate of Neo-Concept (BVI) Limited. Our Controlling Shareholder may from time to time make strategic decisions that it believes are in the best interests of Neo-Concept (BVI) Limited as a whole, including our Company. These decisions may be different from the decision that we would have made on our own. Our Controlling Shareholder’s decisions with respect to us or our business may be resolved in ways that favor our Controlling Shareholder, which may not coincide with the interests of our other shareholders. We may not be able to resolve any potential conflicts, and even if we do so, the resolution may be less favorable to us than if we were dealing with a non-controlling shareholder. Even if both parties seek to transact business on terms intended to approximate those that could have been achieved among unaffiliated parties, this may not succeed in practice.

 

We may have conflicts of interest with our Controlling Shareholder, because of our Controlling Shareholder’s controlling ownership interest in our Company, we may not be able to resolve such conflicts on terms favorable to us.

 

Our Controlling Shareholder beneficially owns 71.5% of our outstanding ordinary shares and total voting power. Accordingly, our Controlling Shareholder may have significant influence in determining the outcome of any corporate actions or other matters that require shareholder approval, such as mergers, consolidations, change of our name, and amendments of our memorandum and articles of association.

 

The concentration of ownership and voting power may cause transactions to occur in a way that may not be beneficial to you as a holder of our Ordinary Shares and may prevent us from doing transactions that would be beneficial to you. Conflicts of interest may arise between our Controlling Shareholder and us in a number of areas relating to our past and ongoing relationships. Potential conflicts of interest that we have identified include the following:

 

●

New customer acquisition. Because both we and NCH, an affiliated company under the common control of our Controlling Shareholder, are engaged in providing apparel solutions services, this potential conflict of interest may limit our ability to attract new clients who are existing customers of NCH therefore impairing our ability to expand our market share which may not be in the best interest of our shareholders.

 

3

 

 

●

Employee recruiting and retention. Because both we and NCH, which is an affiliated company under the common control of our Controlling Shareholder, are engaged in providing apparel solutions services out of Hong Kong, we may compete with our Controlling Shareholder in the hiring of new employees. We entered into an Agreement and have a non-solicitation arrangement that restricts NCH from hiring any of our employees.

 

●

Our board members or executive officers may have conflicts of interest. Our chairlady of the board and chief executive officer, Ms. Eva Yuk Yin Siu and our director, Ms. Man Chi Wai, are also directors in other companies, which include but are not limited to NCH, and engage in businesses such as (i) apparel solution services for customers based in China, North America and Europe, (ii) textile and garment manufacturing, (iii) retail sales of apparel products in China and (iv) other non-apparel related businesses such as retail and wholesale of food and beverages. As a result, they may not have sufficient capacity to perform their duties in NCI. These overlapping relationships could create or appear to create conflicts of interest when these persons are faced with decisions with potentially different implications for our Controlling Shareholder and us.

 

●

Non-competition arrangements with our Controlling Shareholder. We entered into an Exclusive Territory and Non-Competition Agreement with Neo-Concept (BVI) Limited, the holding company of NCH and other subsidiaries engaged in a competing business with our Company, under which Neo-Concept (BVI) Limited agrees not to compete with us in any territories that we operate in, except for owning non-controlling equity interest in any company competing with us and that they can continue to service existing clients during a transitional period.

 

●

Developing business relationships with our NCH’s competitors. So long as our Controlling Shareholder remains as our controlling shareholder, we may be limited in our ability to do business with NCH’s competitors, such as other contract manufacturers. This may limit our ability to conduct our services for the best interests of NCI and our other shareholders.

 

Our directors and officers may allocate their time to other businesses, thereby causing conflicts of interest in their determination as to how much time to devote to our affairs.

 

Our directors and officers are not required to commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and their other businesses. Our directors and officers are engaged in several other business endeavors and may commit themselves to other entities. Our directors and officers are not obligated to contribute any specific number of hours per week to the Company’s affairs. If the other business affairs of our directors and officers require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to the affairs of the Company, which could have a negative impact on our ability to operate efficiently.

 

In particular, Ms. Siu and Ms. Wai are affiliated with other entities, namely NCH, engaged in business activities similar to those conducted by us. Due to their existing affiliations, Ms. Siu and Ms. Wai may have fiduciary obligations to present potential business opportunities to those entities before presenting them to us, which could cause additional conflicts of interest. We cannot assure you that these conflicts will be resolved in our favor.

 

You should refer to the section of this report entitled “Management — Conflicts of Interest/Duties of Directors.” for a detailed discussion of our directors’ other business affairs.

 

We rely on dividends and other distributions on equity paid by our subsidiaries to fund our cash and financing requirements, and any limitation on the ability of our subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business.

 

NCI is a holding company, and we rely on dividends and other distributions on equity paid by our subsidiaries for our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and to service any debt we may incur. If any one of our subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us.

 

4

 

 

There are no statutory prohibitions in the Cayman Islands on the granting of financial assistance by a company to another person for the purchase of, or subscription for, its own, its holding company’s or a subsidiary’s shares. Therefore, a company may provide financial assistance provided the directors of the company, when proposing to grant such financial assistance, discharge their duties of care and act in good faith, for a proper purpose and in the interests of the company. Such assistance should be on an arm’s-length basis. Subject to a solvency test, as prescribed in the Companies Act, and the provisions, if any, of the company’s memorandum and articles of association, a company may pay dividends and distributions out of its share premium account. In addition, based upon English case law which is likely to be persuasive in the Cayman Islands, dividends may be paid out of profits. The Cayman Islands does not impose a withholding tax on payments of dividends to shareholders in the Cayman Islands.

 

Under Hong Kong law, dividends could only be paid out of distributable profits (that is, accumulated realized profits less accumulated realized losses) or other distributable reserves, as permitted under Hong Kong law. Dividends cannot be paid out of share capital. There are no restrictions or limitation under the laws of Hong Kong imposed on the conversion of HK dollar into foreign currencies and the remittance of currencies out of Hong Kong, nor there is any restriction on foreign exchange to transfer cash between NCI and its subsidiaries, across borders and to U.S investors, nor there is any restrictions and limitations to distribute earnings from our business and subsidiaries to NCI and U.S. investors and amounts owed. Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us.

 

According to the BVI Business Companies Act 2004 (as amended), a British Virgin Islands company may make dividends distribution to the extent that immediately after the distribution, the value of the company’s assets exceeds its liabilities and that such company is able to pay its debts as they fall due.

 

Under UK law, no dividend can be paid by a UK company unless (i) the company has sufficient profits available for distribution under the provisions of the UK Companies Act 2006 (as amended) and accounting principles generally accepted in the United Kingdom, and (ii) any applicable restriction(s) or requirement(s) set out in the company’s constitution have been complied with.

 

Any limitation on the ability of our subsidiaries to pay dividends or make other distributions to us could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends, or otherwise fund and conduct our business.

 

Our lack of effective internal controls over financial reporting may affect our ability to accurately report our financial results or prevent fraud which may affect the market for and price of our Ordinary Shares.  

 

Our independent registered public accounting firm is currently not required to conduct an audit of our internal control over financial reporting. In the course of auditing our consolidated financial statements as of December 31, 2023, our management has not received from our independent registered public accounting firm any report regarding deficiencies in our internal controls over financial reporting. As a small-scale company, we are in the process of establishing and improving our internal controls. Upon our independent registered public accounting firm’s suggestions, with the development of our business and the increase of our financial personnel, we will improve our internal control management. 

 

We have implemented measures designed to improve our internal control over financial reporting to address the underlying causes of these material weaknesses, including appointment of independent Directors and establishment of an audit committee aiming to strengthen corporate governance.

 

We will be subject to the requirement that we maintain internal controls and that management perform periodic evaluation of the effectiveness of our internal controls. Effective internal control over financial reporting is important to prevent fraud. As a result, our business, financial condition, results of operations and prospects, as well as the market for and trading price of our Ordinary Shares, may be materially and adversely affected if we do not have effective internal controls. We may not discover any problems in a timely manner and in such an event our shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our Ordinary Shares. The absence of internal controls over financial reporting may inhibit investors from purchasing our Ordinary Shares and may make it more difficult for us to raise funds in debt or equity financing. Additional material weaknesses or significant deficiencies may be identified in the future. If we identify such issues or if we are unable to produce accurate and timely financial statements, our stock price may decline, and we may be unable to maintain compliance with the Nasdaq Listing Rules.

 

5

 

 

Risks Relating to Doing Business in Jurisdictions in which the Operating Subsidiaries Operate

 

Our key operations are in Hong Kong. However, due to long arm provisions under the current PRC laws and regulations, the Chinese government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of our Ordinary Shares. Changes in the policies, regulations, rules, and the enforcement of laws of the Chinese government may also be quick with little advance notice and our assertions and beliefs of the risk imposed by the PRC legal and regulatory system cannot be certain.

 

NCI is a holding company, and we conduct our operations in Hong Kong through our operating subsidiary, Neo-Concept HK. As at the date of this report, we are not materially affected by recent statements by the Chinese Government indicating an intention to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers. However, due to long arm provisions in the current PRC laws and regulations, there remains regulatory uncertainty with respect to the implementation and interpretation of laws in China as they may affect Hong Kong. The PRC government may choose to exercise additional oversight and discretion over Hong Kong, and the policies, regulations, rules, and the enforcement of laws of the Chinese government to which we are subject may change rapidly with little advance notice to us or our shareholders. As a result, the application, interpretation, and enforcement of new and existing laws and regulations in the PRC and our assertions and beliefs of the risk imposed by the PRC legal and regulatory system are by their very nature uncertain. In addition, these PRC laws and regulations may be interpreted and applied inconsistently by different agencies or authorities, which may result in inconsistency with our current policies and practices. New laws, regulations, and other government directives in the PRC may also be costly to comply with, and such compliance or any associated inquiries or investigations or any other government actions may:

 

●

delay or impede our development;

 

●

result in negative publicity or increase our operating costs;

 

●

require significant management time and attention; and

 

●

subject us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our current or historical operations, or demands or orders that we modify or even cease our business practices.

 

We are aware that recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using a VIE structure, adopting new measures to extend the scope of cybersecurity reviews and expanding the efforts in anti-monopoly enforcement. Since these statements and regulatory actions are new, it is highly uncertain how soon the PRC legislative or administrative regulation making bodies will respond or what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, or what the potential impact that any such modified or new laws and regulations would have on our daily business operation, the ability to accept foreign investments and list on an U.S. or other foreign exchange.

 

The Chinese government may intervene or influence our operations at any time and may exert more control over offerings conducted overseas and foreign investment in China-based issuers, which may result in a material change in our operations and/or the value of our Ordinary Shares. The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, in each case, that restrict or otherwise unfavorably impact our ability to conduct our business could require us to change certain aspects of our business to ensure compliance, decrease demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits, approvals or certificates, or subject us to additional liabilities. To the extent any new or more stringent measures are implemented, our business, financial condition and results of operations could be adversely affected, and the value of our Ordinary Shares could decrease or become worthless.

 

6

 

 

If the Chinese government chooses to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.

 

Recent statements by the Chinese government have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in China-based issuers. On July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued a document to crack down on illegal activities in the securities market and promote the high-quality development of the capital market, which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation, to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application of the PRC securities laws. Furthermore, on December 28, 2021, the CAC jointly with the relevant authorities published the Measures for Cybersecurity Review (2021), or the “Review Measures 2021”, which took effect on February 15, 2022, and replaced the Measures for Cybersecurity Review (2020) issued on April 13, 2020. Review Measures 2021 stipulates that operators of critical information infrastructure purchasing network products and services, and online platform operators carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, and any online platform operator who controls more than one million users’ personal information must apply for a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country. Based on a set of Q&As published on the official website of the State Cipher Code Administration in connection with the issuance of the Review Measures 2021, an official of the said administration indicated that an online platform operator should apply for a cybersecurity review prior to the submission of its listing application with non-PRC securities regulators. Moreover, the CAC released the draft of the Regulations on Network Data Security Management in November 2021 for public consultation, which among other things, stipulates that a data processor listed overseas must conduct an annual data security review by itself or by engaging a data security service provider and submit the annual data security review report for the previous year to the municipal cybersecurity department before January 31 of the following year. Given the recency of the issuance of the Review Measures 2021 and the pending effectiveness of the Regulations on Network Data Security Management, there is a general lack of guidance and substantial uncertainties exist with respect to their interpretation and implementation.

 

It remains unclear whether a Hong Kong company shall be subject to the Review Measures 2021. But we believe our HK subsidiary is neither a “critical information infrastructure” operator nor an online platform operator as defined in the Review Measures 2021, that are required to file for cybersecurity review before listing in the U.S., because (i) Neo-Concept HK is incorporated and operating in Hong Kong and the Review Measures 2021 remains unclear whether it shall be applied to a Hong Kong company; (ii) Neo-Concept HK operates without any subsidiary or VIE structure in mainland China; (iii) as of date of this report, Neo-Concept HK has not collected and stored any personal information of PRC individual client; and (vi) as of the date of this report, Neo-Concept HK has not been informed by any PRC governmental authority of any requirement that it files for a cybersecurity review. However, there remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations. If Neo-Concept HK is deemed an “operator of critical information infrastructure” or an “online platform operator” as defined in the Review Measures 2021, Neo-Concept HK’s operation and the listing of our Ordinary Shares in the U.S. could be subject to CAC’s cybersecurity review in the future.

 

On February 17, 2023, the CSRC released the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, or the Trial Measures, which came into effect on March 31, 2023. On the same date of the issuance of the Trial Measures, the CSRC circulated No. 1 to No. 5 Supporting Guidance Rules, the Notes on the Trial Measures, the Notice on Administration Arrangements for the Filing of Overseas Listings by Domestic Enterprises and the relevant CSRC Answers to Reporter Questions on the official website of the CSRC, or collectively, the Guidance Rules and Notice. The Trial Measures, together with the Guidance Rules and Notice, reiterate the basic supervision principles as reflected in the Draft Overseas Listing Regulations by providing substantially the same requirements for filings of overseas offering and listing by domestic companies, yet made the following updates compared to the Draft Overseas Listing Regulations: (a) further clarification of the circumstances prohibiting overseas issuance and listing; (b) further clarification of the standard of indirect overseas listing under the principle of substance over form, and (c) adding more details of filing procedures and requirements by setting different filing requirements for different types of overseas offering and listing. Pursuant to the Trial Measures, the Guidance Rules and Notice, domestic companies that seek to offer or list securities overseas, both directly and indirectly, should fulfill the filing procedure and report relevant information to the CSRC within three working days following its submission of initial public offerings or listing application. On December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took effect on February 15, 2022 and replaced the former Measures for Cybersecurity Review (2020) issued on April 13, 2020. Measures for Cybersecurity Review (2021) stipulates that operators of critical information infrastructure purchasing network products and services, and online platform operators carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, and any online platform operator who controls more than one million users’ personal information must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country.

 

7

 

 

The Company understands that as of the date of this report, the Group has no operations in Mainland China and is not required to complete filing procedures with the CSRC pursuant to the requirements of the Trial Measures. While the Group has no current operations in Mainland China, should we have any future operations in Mainland China and should we (i) fail to receive or maintain such permissions or approvals, (ii) inadvertently conclude that such permissions or approvals are not required, or (iii) applicable laws, regulations, or interpretations change and require us to obtain such permissions or approvals in the future, we may face sanctions by the CSRC, the Cyberspace Administration of China (the “CAC”) or other PRC regulatory agencies. These regulatory agencies may also impose fines and penalties on our operations in China, as well as limit our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from our IPO or other offerings into China or take other actions that could have a material adverse effect on our business as well as the trading price of our Ordinary Shares. We may be required to restructure our operations to comply with such regulations or potentially cease operations in the PRC entirely. The CSRC, the CAC or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt our future offerings before settlement and delivery of our Ordinary Shares. In addition, if the CSRC, the CAC or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for our offerings, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any action taken by the PRC government could significantly limit or completely hinder our operations in the PRC and our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.

 

As of the date of this report, neither NCI nor any of our subsidiaries are required to obtain any permission or approval from Hong Kong authorities to operate our business. Based on management’s internal assessment that the Company and its subsidiaries currently have no material operations in the PRC, the Management understands that as of the date of this report, the Company is not required to obtain any permissions or approvals from PRC authorities before listing in the U.S. and to issue our Ordinary Shares to foreign investors, including the CAC or the CSRC because (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like our IPO are subject to this regulation; and (ii) the Company operates in Hong Kong and is not included in the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC. We also understand that NCA, Neo-Concept HK and Neo-Concept UK are not required to obtain any permissions or approvals from any Chinese authorities to operate their businesses as of the date of this report. No permissions or approvals have been applied for by the Company or denied by any relevant authorities. However, uncertainties still exist, due to the possibility that laws, regulations, or policies in the PRC could change rapidly in the future.

 

In the event that (i) the PRC government expanded the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC that we are required to obtain such permissions or approvals; or (ii) we inadvertently concluded that relevant permissions or approvals were not required or that we did not receive or maintain relevant permissions or approvals required, any action taken by the PRC government could significantly limit or completely hinder our operations in Hong Kong and our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or become worthless.

 

The Hong Kong legal system embodies uncertainties which could limit the legal protections available to Our Operating Subsidiaries.

 

Hong Kong is a Special Administrative Region (“SAR”) of the PRC. Following British colonial rule from 1842 to 1997, China assumed sovereignty under the “one country, two systems” principle. The Hong Kong SAR’s constitutional document, the Basic Law, ensures that the current political situation will remain in effect for 50 years. Hong Kong has enjoyed the freedom to function with a high degree of autonomy for its affairs, including currencies, immigration and customs operations, and its independent judiciary system and parliamentary system. On July 14, 2020, the United States signed an executive order to end the special status enjoyed by Hong Kong post-1997. As the autonomy currently enjoyed may be compromised, it could potentially impact Hong Kong’s common law legal system and may, in turn, bring about uncertainty in, for example, the enforcement of our contractual rights. This could, in turn, materially and adversely affect our business and operations. Additionally, intellectual property rights and confidentiality protections in Hong Kong may not be as effective as in the United States or other countries. Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system, including the promulgation of new laws, changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local regulations by national laws. These uncertainties could limit the legal protections available to us, including our ability to enforce our agreements with our clients.

 

8

 

 

Although the audit report included in this report is prepared by U.S. auditors who are currently inspected by the PCAOB, there is no guarantee that future audit reports will be prepared by auditors inspected by the PCAOB and, as such, in the future, investors may be deprived of the benefits of such inspection. Furthermore, trading in our securities may be prohibited under the HFCAA if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely, and as a result, U.S. national securities exchanges, such as the Nasdaq, may determine to delist our securities. Furthermore, on December 23, 2022, the Accelerating Holding Foreign Companies Accountable Act was enacted, which amended the HFCAA by requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time before the securities may be prohibited from trading or delisted.

 

As an auditor of companies that are registered with the SEC and publicly traded in the United States and a firm registered with the PCAOB, our auditor is required under the laws of the United States to undergo regular inspections by the PCAOB to assess their compliance with the laws of the United States and professional standards. The PCAOB is currently unable to conduct inspections without the approval of the Chinese government authorities. Currently, our U.S. auditor is inspected by the PCAOB, and we have no operations in mainland China. However, if there is significant change to current political arrangements between mainland China and Hong Kong, companies operating in Hong Kong like us may face similar regulatory risks as those operated in PRC and we cannot assure you that our auditor’s work will continue to be able to be inspected by the PCAOB.

 

Inspections of other auditors conducted by the PCAOB outside mainland China have at times identified deficiencies in those auditors’ audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality. The lack of PCAOB inspections of audit work undertaken in mainland China prevents the PCAOB from regularly evaluating auditors’ audits and their quality control procedures. As a result, if there is any component of our auditor’s work papers become located in mainland China in the future, such work papers will not be subject to inspection by the PCAOB. As a result, investors would be deprived of such PCAOB inspections, which could result in limitations or restrictions to our access of the U.S. capital markets.

 

As part of a continued regulatory focus in the United States on access to audit and other information currently protected by national law, in particular mainland China’s, in June 2019, a bipartisan group of lawmakers introduced bills in both houses of the U.S. Congress which, if passed, would require the SEC to maintain a list of issuers for which PCAOB is not able to inspect or investigate the audit work performed by a foreign public accounting firm completely. The proposed Ensuring Quality Information and Transparency for Abroad-Based Listings on our Exchanges (“EQUITABLE”) Act prescribes increased disclosure requirements for these issuers and, beginning in 2025, the delisting from U.S. national securities exchanges, such as the Nasdaq, of issuers included on the SEC’s list for three consecutive years. It is unclear if this proposed legislation will be enacted. Furthermore, there have been recent deliberations within the U.S. government regarding potentially limiting or restricting China-based companies from accessing U.S. capital markets.

 

On May 20, 2020, the U.S. Senate passed the HFCAA, which includes requirements for the SEC to identify issuers whose audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely because of a restriction imposed by a non-U.S. authority in the auditor’s local jurisdiction. The U.S. House of Representatives passed the HFCAA on December 2, 2020, and the HFCAA was signed into law on December 18, 2020. Additionally, in July 2020, the U.S. President’s Working Group on Financial Markets issued recommendations for actions that can be taken by the executive branch, the SEC, the PCAOB or other federal agencies and department with respect to Chinese companies listed on U.S. stock exchanges and their audit firms, in an effort to protect investors in the United States. In response, on November 23, 2020, the SEC issued guidance highlighting certain risks (and their implications to U.S. investors) associated with investments in China-based issuers and summarizing enhanced disclosures the SEC recommends China-based issuers make regarding such risks.

 

9

 

 

On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements in the HFCAA. On December 2, 2021, the SEC adopted amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate. We will be required to comply with these rules if the SEC identifies us as having a “non-inspection” year under a process to be subsequently established by the SEC. The final amendments require any identified registrant to submit documentation to the SEC establishing that the registrant is not owned or controlled by a government entity in the public accounting firm’s foreign jurisdiction, and also require, among other things, disclosure in the registrant’s annual report regarding the audit arrangements of, and government influence on, such registrants. Under the HFCAA, our securities may be prohibited from trading on the Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being delisted.

 

On June 22, 2021, the U.S. Senate passed the AHFCAA, which was enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus, reducing the time before our Ordinary Shares may be prohibited from trading or delisted. On December 29, 2022, legislation titled “Consolidated Appropriations Act, 2023” (the “Consolidated Appropriations Act”), was signed into law by President Biden. The Consolidated Appropriations Act contained, among other things, an identical provision to AHFCAA, which reduces the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA from three years to two.

 

On September 22, 2021, the PCAOB adopted a final rule implementing the HFCAA, which provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether the Board is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.

 

On November 5, 2021, the SEC approved the PCAOB’s Rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act. Rule 6100 provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether it is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.

 

On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions (“Commission-Identified Issuers”). The final amendments require Commission-Identified Issuers to submit documentation to the SEC establishing that, if true, it is not owned or controlled by a governmental entity in the public accounting firm’s foreign jurisdiction. The amendments also require that a Commission-Identified Issuer that is a “foreign issuer,” as defined in Exchange Act Rule 3b-4, provide certain additional disclosures in its annual report for itself and any of its consolidated foreign operating entities. Further, the release provides notice regarding the procedures the SEC has established to identify issuers and to impose trading prohibitions on the securities of certain Commission-Identified Issuers, as required by the HFCAA. The SEC will identify Commission-Identified Issuers for fiscal years beginning after December 18, 2020. A Commission-Identified Issuer will be required to comply with the submission and disclosure requirements in the annual report for each year in which it was identified. If a registrant is identified as a Commission-Identified Issuer based on its annual report for the fiscal year ended December 31, 2021, the registrant will be required to comply with the submission or disclosure requirements in its annual report filing covering the fiscal year ended December 31, 2022. The final amendments became effective on January 10, 2022.

 

On December 16, 2021, the PCAOB issued a report on its determinations that it was unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in Mainland China and in Hong Kong, because of positions taken by PRC authorities in those jurisdictions. The PCAOB made its determinations pursuant to PCAOB Rule 6100, which provides a framework for how the PCAOB fulfills its responsibilities under the HFCAA. The report further listed in its Appendix A and Appendix B, Registered Public Accounting Firms Subject to the Mainland China Determination and Registered Public Accounting Firms Subject to the Hong Kong Determination, respectively. Our auditor, WWC, P.C. is headquartered in San Mateo, California, and did not appear as part of the report under the lists in its appendix A or appendix B.

 

10

 

 

On August 26, 2022, the CSRC, the MOF, and the PCAOB signed a Statement of Protocol (the “Protocol”) to allow the PCAOB to inspect and investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, consistent with the HFCAA, and the PCAOB will be required to reassess its determinations by the end of 2022. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC.

 

On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong completely in 2022. The PCAOB Board vacated its previous 2021 determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong. However, whether the PCAOB will continue to be able to satisfactorily conduct inspections of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainties and depends on a number of factors out of our and our auditor’s control. The PCAOB continues to demand complete access in mainland China and Hong Kong moving forward and is making plans to resume regular inspections in early 2023 and beyond, as well as to continue pursuing ongoing investigations and initiate new investigations as needed. The PCAOB has also indicated that it will act immediately to consider the need to issue new determinations with the HFCAA if needed.

 

If the PCAOB is unable to inspect and investigate completely registered public accounting firms located in China in 2023 and beyond, or if we fail to, among others, meet the PCAOB’s requirements, including retaining a registered public accounting firm that the PCAOB determines it is able to inspect and investigate completely, we will be identified as a “Commission-identified Issuer,” and upon the expiration of the applicable years of non-inspection under the HFCAA and relevant regulations, the Ordinary Shares will be delisted and will not be permitted for trading over the counter. Such a delisting or prohibition would substantially impair your ability to sell or purchase the Ordinary Shares, and the risk and uncertainty associated with delisting would have a negative impact on the price of the Ordinary Shares. Moreover, the HFCAA or other efforts to increase U.S. regulatory access to audit information could cause investor uncertainty for affected issuers, including us, and the market price of the Ordinary Shares could be adversely affected. Such a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition, and prospects.

 

The SEC is assessing how to implement other requirements of the HFCAA, including the listing and trading prohibition requirements described above. Future developments in respect of increasing U.S. regulatory access to audit information are uncertain, as the legislative developments are subject to the legislative process and the regulatory developments are subject to the rule-making process and other administrative procedures.

 

While the CSRC, the MOF and the PCAOB have entered into the SOP Agreements regarding the inspection of PCAOB-registered accounting firms in mainland China, there can be no assurance that we will be able to comply with requirements imposed by U.S. regulators if there is significant change to current political arrangements between mainland China and Hong Kong, or if any component of our auditor’s work papers become located in mainland China in the future. Delisting of our Ordinary Shares would force holders of our Ordinary Shares to sell their Ordinary Shares. The market price of our Ordinary Shares could be adversely affected as a result of anticipated negative impacts of these executive or legislative actions upon, regardless of whether these executive or legislative actions are implemented and regardless of our actual operating performance.

 

The recent joint statement by the SEC, proposed rule changes submitted by Nasdaq, and an act passed by the U.S. Senate and the U.S. House of Representatives, all call for additional and more stringent criteria to be applied to emerging market companies. These developments could add uncertainties to our future offerings, business operations, share price and reputation.

 

U.S. public companies that have substantially all of their operations in China (including in Hong Kong) have been the subject of intense scrutiny, criticism and negative publicity by investors, financial commentators and regulatory agencies, such as the SEC. Much of the scrutiny, criticism and negative publicity has centered on financial and accounting irregularities and mistakes, a lack of effective internal controls over financial accounting, inadequate corporate governance policies or a lack of adherence thereto and, in many cases, allegations of fraud.

 

On December 7, 2018, the SEC and the PCAOB issued a joint statement highlighting continued challenges faced by the U.S. regulators in their oversight of financial statement audits of U.S.-listed companies with significant operations in China. On April 21, 2020, SEC Chairman Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks associated with investing in companies based in or have substantial operations in emerging markets including China, reiterating past SEC and PCAOB statements on matters including the difficulty associated with inspecting accounting firms and audit work papers in China and higher risks of fraud in emerging markets and the difficulty of bringing and enforcing SEC, Department of Justice and other U.S. regulatory actions, including in instances of fraud, in emerging markets generally.

 

11

 

 

On May 20, 2020, the U.S. Senate passed the HFCAA, which includes requirements for the SEC to identify issuers whose audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely because of a restriction imposed by a non-U.S. authority in the auditor’s local jurisdiction. The U.S. House of Representatives passed the HFCAA on December 2, 2020, and the HFCAA was signed into law on December 18, 2020. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, enacted on December 23, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time before our Ordinary Shares may be prohibited from trading or delisted.

 

On May 21, 2021, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in a “Restrictive Market”, (ii) prohibit Restrictive Market companies from directly listing on Nasdaq Capital Market, and only permit them to list on Nasdaq Global Select or Nasdaq Global Market in connection with a direct listing and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s auditors.

 

As a result of these scrutiny, criticism and negative publicity, the publicly traded stock of many U.S. listed Chinese companies sharply decreased in value and, in some cases, has become virtually worthless. Many of these companies are now subject to shareholder lawsuits and SEC enforcement actions and are conducting internal and external investigations into the allegations. It is not clear what effect this sector-wide scrutiny, criticism and negative publicity will have on us, our future offerings, business and our share price. If we become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we will have to expend significant resources to investigate such allegations and/or defend our company. This situation will be costly and time consuming and distract our management from developing our growth. If such allegations are not proven to be groundless, we and our business operations will be severely affected and you could sustain a significant decline in the value of our share.

 

The enactment of the Law of the PRC on Safeguarding National Security in the Hong Kong Special Administrative Region (the “Hong Kong National Security Law”) could impact our Hong Kong subsidiary, which represents substantially all of our business.

 

On June 30, 2020, the Standing Committee of the PRC National People’s Congress adopted the Hong Kong National Security Law. This law defines the duties and government bodies of the Hong Kong National Security Law for safeguarding national security and four categories of offenses — secession, subversion, terrorist activities, and collusion with a foreign country or external elements to endanger national security — and their corresponding penalties. On July 14, 2020, the former U.S. President Donald Trump signed the Hong Kong Autonomy Act, or HKAA, into law, authorizing the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong’s autonomy. On August 7, 2020, the U.S. government imposed HKAA-authorized sanctions on eleven individuals, including former HKSAR chief executive Carrie Lam. On October 14, 2020, the U.S. State Department submitted to relevant committees of Congress the report required under HKAA, identifying persons materially contributing to “the failure of the Government of China to meet its obligations under the Joint Declaration or the Basic Law.” The HKAA further authorizes secondary sanctions, including the imposition of blocking sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned under this authority. The imposition of sanctions may directly affect the foreign financial institutions as well as any third parties or customers dealing with any foreign financial institution that is targeted. It is difficult to predict the full impact of the Hong Kong National Security Law and HKAA on Hong Kong and companies located in Hong Kong, which represents substantially all of our business. If our subsidiaries are determined to be in violation of the Hong Kong National Security Law or the HKAA by competent authorities, our business operations, financial position, and results of operations could be materially and adversely affected.

 

If we become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed China-based companies, we may have to expend significant resources to investigate and/or defend the matter which could harm our business operations, any future offerings and our reputation and could result in a loss of your investment in our ordinary shares, in particular if such matter cannot be addressed and resolved favorably.

 

During the last several years, U.S. listed public companies that have substantially all of their operations in China have been the subject of intense scrutiny by investors, financial commentators and regulatory agencies. Much of the scrutiny has centered on financial and accounting irregularities and mistakes, lack of effective internal controls over financial reporting and, in many cases, allegations of fraud. As a result of the scrutiny, the publicly traded stock of many U.S.-listed Chinese companies that have been the subject of such scrutiny has sharply decreased in value. Many of these companies are now subject to shareholder lawsuits and/or SEC enforcement actions that are conducting internal and/or external investigations into the allegations.

 

If we become the subject of any such scrutiny, whether any allegations are true or not, we may have to expend significant resources to investigate such allegations and/or defend the Company. Such investigations or allegations would be costly and time-consuming and likely would distract our management from our normal business and could result in our reputation being harmed. Our stock price could decline because of such allegations, even if the allegations are false.

 

12

 

 

There are political risks associated with conducting business in Hong Kong.

 

Any adverse economic, social and/or political conditions, material social unrest, strike, riot, civil disturbance, or disobedience, as well as significant natural disasters, may affect the market may adversely affect the business operations of the Company. Hong Kong is a special administrative region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law, namely, Hong Kong’s constitutional document, which provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers, including that of final adjudication under the principle of “one country, two systems”. However, there is no assurance that there will not be any changes in the economic, political, and legal environment in Hong Kong in the future. Since our operation is based in Hong Kong, any change of such political arrangements may pose immediate threat to the stability of the economy in Hong Kong, thereby directly and adversely affecting our results of operations and financial positions.

 

Under the Basic Law of the Hong Kong Special Administrative Region of the People’s Republic of China, Hong Kong is exclusively in charge of its internal affairs and external relations while the government of the PRC is responsible for its foreign affairs and defense. As a separate customs territory, Hong Kong maintains and develops relations with foreign states and regions. Based on certain recent development including the Hong Kong National Security Law issued by the Standing Committee of the PRC National People’s Congress in June 2020, the U.S. State Department has indicated that the United States no longer considers Hong Kong to have significant autonomy from China and at the time President Trump signed an executive order and Hong Kong Autonomy Act, or HKAA, to remove Hong Kong’s preferential trade status and to authorize the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong’s autonomy. The United States may impose the same tariffs and other trade restrictions on exports from Hong Kong that it places on goods from mainland China. These and other recent actions may represent an escalation in political and trade tensions involving the U.S., China, and Hong Kong, which could potentially harm our business.

 

Given the relatively small geographical size of Hong Kong, any of such incidents may have a widespread effect on our business operations, which could in turn adversely and materially affect our business, results of operations and financial condition. It is difficult to predict the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative, or administrative actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price of our Ordinary Shares could be adversely affected.

 

Changes in international trade policies, trade disputes, barriers to trade, or the emergence of a trade war may dampen growth in markets where the majority of our customers reside.

 

Political events, international trade disputes, and other business interruptions could harm or disrupt international commerce and the global economy and could have a material adverse effect on us and our customers, our service providers, and our other partners. International trade disputes could result in tariffs and other protectionist measures which may materially and adversely affect our business.

 

Tariffs could increase the cost of the services and products which could affect customers’ investment decisions. In addition, political uncertainty surrounding international trade disputes and the potential of their escalation to trade war and global recession could have a negative effect on customer confidence, which could materially and adversely affect our business. We may have also access to fewer business opportunities, and our operations may be negatively impacted as a result. In addition, the current and future actions, or escalations by either the United States or China that affect trade relations may cause global economic turmoil and potentially have a negative impact on our markets, our business, or our results of operations, as well as the financial condition of our clients, and we cannot provide any assurances as to whether such actions will occur or the form that they may take.

 

Fluctuations in exchange rates could have a material and adverse effect on our results of operations and the value of your investment.

 

Our revenues and expenses will be denominated predominantly in Hong Kong dollars. Although the exchange rate between the Hong Kong dollar to the U.S. dollar has been pegged since 1983, we cannot assure you that the Hong Kong dollar will remain pegged to the U.S. dollar. Any significant fluctuations in the exchange rates between Hong Kong dollars to U.S. dollars may have a material adverse effect on our revenue and financial condition. We have not used any forward contracts, futures, swaps or currency borrowings to hedge our exposure to foreign currency risk.

 

13

 

 

Risks Relating to Our Business and Industry

 

We rely on one major customer, and if we fail to attract new customers, retain existing customers, or maintain or increase sales to customers, our business, financial condition, results of operations, and growth prospects will be harmed.

 

We rely on one major customer which contributed approximately 71.3%, 91.4% and 94.5% of our total revenues for the years ended December 31, 2023, 2022 and 2021, respectively. We do not have long-term agreements with any of our top five customers and their purchases are made on an order-by-order basis. Our business with our customers has been, and we expect it will continue to be, conducted based on the actual orders received from time to time. Our customers are not obligated in any way to continue placing orders with us at the same or increasing levels, or at all. Our customers level of demand for our apparel products may fluctuate significantly from period to period. Such fluctuation is attributable mainly to changes in customer demand, including their business strategies, operational needs, product portfolio and interpretation of fashion trends. The loss of our principal customer, or if we are unable to attract new customers or if our existing customers decrease their spending on the products we offer, fail to make repeat purchases of our products, will harm our business, financial condition, results of operations, and growth prospects.

 

We may be unable to timely and accurately respond to changes in fashion trends and consumer preferences.

 

We are a provider of one-stop apparel solution services, and we offer in-house product design services to our customers. We also engage in the retail sales of apparel products to consumers. We must stay abreast of emerging consumer preferences and anticipate product trends that will appeal to existing and potential consumers. We believe that our success is, to an important extent, attributable to the ability of our design and product development personnel to design apparel products that are responsive to changes in consumer preferences. Due to the highly subjective nature of the fashion trends and the rapid change in fashion trends for apparels as well as the preferences of our customers and consumers, we may be unable to capture or predict the future fashion trend and continue to develop appealing designs for our customers. If we fail to capture, predict, or respond timely to changes in market preferences and introduce appealing and commercially viable apparel designs in a timely manner, our customers may choose to work with our competitors with market-sensitive designs or purchase products from our competitors.

 

Our focus on using sustainable materials and environmentally friendly manufacturing processes and supply chain practices may increase our cost of doing business and hinder our growth.

 

We are dedicated to prioritizing sustainable materials, an environmentally friendly supply chain, and manufacturing processes that collectively limit our environmental footprint. As our business expands, it may be increasingly challenging to cost-effectively secure enough sustainably sourced materials to support our growth and achieve our sustainability goals while also achieving and maintaining profitability. In addition, our ability to expand into new product categories or expand our existing product mix with our core customers depends in part on our ability to identify new sustainable materials that are suitable for our products. Our inability to source materials that meet our sustainability requirements in sufficient volumes could result in slower growth, increased costs, and/or lower net profits. Additionally, as our business expands, we may not be able to identify suppliers and manufacturers with business practices that reflect our commitment to sustainability, which may harm our ability to expand our supply chain to meet the expected growth of our business. If any of these factors prevent us from meeting our sustainability goals or increase the carbon footprint of any our products, then it could have an adverse effect on our brand, reputation, results of operations, and financial condition.

 

The enactment in the U.S. of the Uyghur Forced Labor Prevention Act (the “UFLPA”) and similar pending legislation in the territories in which our subsidiaries operate could have material adverse effect on our ability to conduct our business.

 

The UFLPA prohibits on the importation of goods into the United States manufactured wholly or in part with forced labor in the PRC, especially from the Xinjiang Uyghur Autonomous Region (“Xinjiang”). It establishes a rebuttable presumption that the importation of any goods, wares, articles, and merchandise mined, produced, or manufactured wholly or in part in Xinjiang are not entitled to entry to the U.S. and requires the importer of record to comply with specified conditions and, by clear and convincing evidence, that the goods, wares, articles, or merchandise were not produced using forced labor. Our contract manufacturers are located in the PRC, and whereas 84% of Chinese cotton comes from Xinjiang.

 

14

 

 

Governments in the other territories where the company operates (the UK, the EU and Canada) are advancing similar measures to address the risk of goods produced from forced labor from any country from entering the global supply chains in order to ensure that their businesses are not complicit in forced labor in Xinjiang, there is an extraordinarily high risk that the yarn, textiles, and garments made with Chinese cotton are tainted with forced and prison labor. Violations of the UFLPA can empower U.S. Customs and Border Protection to detain, exclude or seize goods and assess monetary penalties.

 

The failure of the Company’s supply chain management system to rebut the presumption that its products are tainted with forced or prison labor could materially and adversely affect our business operations, financial position, and results of operations.

 

We rely on two principal suppliers for supplies of raw materials, manufacturing services and logistics services.

 

The apparel products sold or sourced by us during the years ended December 31, 2022, 2022 and 2021, were mainly produced by two contract manufacturers, one of which is our affiliated company. During the years ended December 31, 2023, 2022 and 2021 our two contract manufacturers together accounted for 93.9%, 80.1% and 100% of our total purchases, respectively. We engage contract manufacturer on an individual project basis and rely on third party service providers for services including sourcing of materials and provision of logistics services for the finished goods. We do not enter into any long-term contracts with our suppliers, and the terms of services provided by them may be susceptible to fluctuations with regard to pricing, timing and quality. Business relationships with our key suppliers could deteriorate, and existing procurement arrangements could change without advance notice. Increases in raw material prices resulting in higher procurement costs being incurred by our contract manufacturer, may be passed onto us as part of the overall production service costs. Recent inflationary pressures have affected the procurement cost of certain raw materials used in our apparel products. While we have not faced any shortages or significant increases in prices that would have a material adverse effect on our operations, we have had to enact measures to mitigate fluctuations in the price of our key raw materials. These measures include, but are not limited to, placing bulk orders for a portion of our raw material requirements based on projections and sales estimates ahead of the production season and incorporating alternative materials into our products or modifying specifications of product designs. However, our ability to implement such measures are limited and we cannot guarantee that we will be able to successfully mitigate fluctuations or increases in the price of raw materials. We might have to accept substantial increment in price, or a substantial reduction of quantities supplied in some cases, especially when we are unable to locate alternative suppliers in a timely manner and/or on comparable commercial terms. In addition, we are not able to ensure our suppliers’ compliance with applicable laws and regulations. Failure on the part of any of our suppliers to comply with applicable laws and regulations may damage our corporate image, and adversely affect our customer relationships.

 

Our reliance on suppliers to produce our products could cause problems in our supply chain.

 

We do not manufacture our products or the raw materials for them and rely instead on suppliers. We have no long-term contracts with any of our suppliers or manufacturing sources for the production of our fabrics and garments, and we compete with other companies for production.

 

If we experience significant increased demand, or if we need to replace an existing supplier, we may be unable to locate additional manufacturing capacity on terms that are acceptable to us, or at all, or we may be unable to locate any supplier or manufacturer with sufficient capacity to meet our customer’s requirements or to fill our orders in a timely manner. Even if we are able to expand existing or find new manufacturing, we may encounter delays in production and added costs as a result of the time it takes to train our suppliers and manufacturers in our methods, products, and quality control standards. Delays related to supplier changes could also arise due to an increase in shipping times if new suppliers are located farther away from our markets or from other participants in the supply chain. Any delays, interruption, or increased costs in manufacture of our products could have an adverse effect on our ability to meet customer demand for our products and result in lower net revenue and income from operations both in the short and long term.

 

Customers may choose to do business with suppliers directly through online platforms.

 

Our customers pay for our services to leverage our industry knowledge, market connections and logistics management capability. However, it has been increasingly common for brand owners and retailers to place their orders directly to manufacturers through online platforms. If we are unable to provide other value-added services such as product design and development, production management and logistics management to our customers, we face the risk of losing our existing customers, especially those with the confidence and savviness to order apparel products online. With the internet becoming more common in the current economic environment, market demand for our services may decrease.

 

15

 

 

Any negative publicity about our products or services could harm our business and reputation and could materially adversely affect our financial condition and results of operations.

 

An integral part of our value is our reputation as a sustainable and ethical brand and our customers expect a high standard from our products and services. Our ability to maintain this value and the reputation of our business is key to our continued success. Despite our commitment to product innovation, quality, and sustainability and our continuing investment in design (including materials), and quality control, we cannot assure you that our suppliers and manufacturers will adhere to the same commitment. Negative publicity regarding our suppliers or manufacturers could also adversely affect our reputation and sales and could force us to identify and engage alternative suppliers or manufacturers. Any actions or any negative publicity about us may adversely affect consumer perception of our brand, our products and our services. Any incidents involving our company, our suppliers or manufacturers, or the products we sell, could erode the trust and confidence of our customers, and damage the strength of our brand, especially if such incidents result in adverse publicity, governmental investigations, product recalls or litigation.

 

We recorded net current liabilities and a total deficit for three years ended December 31, 2023, 2022 and 2021, and may continue to record net current liabilities and a total deficit in the foreseeable future, which can expose us to liquidity risks.

 

We had net current liabilities of HKD6,088,795 (US$779,524), HKD61,288,133 (US$7,855,942) and HKD75,547,697 as of December 31, 2023,2022 and 2021, respectively. We also had total deficits of HKD2,386,810 (US$305,572), HKD60,675,596 (US$7,777,427) and HKD75,590,274 as of December 31, 2023, 2022 and 2021, respectively. Although we recorded net income of HKD4,414,733 (US$565,202), HKD12,400,516 (US$1,589,505) and HKD5,450,515 for the years ended December 31, 2023, 2022 and 2021, we cannot assure you that we will be able to continue to generate net income in the future. We anticipate that our operating cost and expenses will increase in the foreseeable future as we continue to grow our business. Our efforts to grow our business may prove more costly than we currently anticipate, and we may not succeed in increasing our revenue sufficiently to offset these higher expenses.   

 

We cannot assure you that we will not incur net current liabilities in the future. A net current liabilities position can expose us to the risk of shortfalls in liquidity, in which case our ability to raise funds, obtain bank loans and declare and pay dividends will be materially and adversely affected.

 

Our profitability and liquidity position is dependent on, among other factors, our ability to grow our business and extend our product offering to existing customers and expand our customer base. Any material decrease in our service fees would have a substantial impact on our margin. As a result of the foregoing and other factors, our net income may decline, or we may incur net losses in the future and be unable to achieve or maintain profitability and improve our liquidity position.

 

We cannot guarantee that our right to use the brand “les 100 ciels” trademark will not be revoked and the loss of or our failure to protect or enforce our intellectual property rights would have a material adverse effect on our business and operations.

 

We are currently licensed to use the brand name “les 100 ciels” trademark from affiliate companies of our Controlling Shareholder under a fixed term license agreement valid until December 31, 2026, with an option to renew for a further period of five years. However, we cannot guarantee that such license would not be revoked in the future and the loss of such licenses or inability to use these brands would have a material adverse effect on our business and operations.

 

In addition, intellectual property protection may be unavailable or limited in the countries in which we operate where laws or law enforcement practices may not protect our intellectual property rights as fully as in the United States, and it may be more difficult for us to successfully challenge the use of our intellectual property rights by other parties in these countries. For instance, some of our trademark or trade dress applications may not be approved by the applicable governmental authorities because they are determined to lack sufficient distinctiveness, and, even if approved, may be challenged by third parties for this same reason. If we fail to protect and maintain our intellectual property rights, the value of our brand could be diminished, and our competitive position may suffer.

 

16

 

 

We are exposed to credit risks of our customers.

 

We are exposed to credit risks of our customers. We do not have access to all the information necessary to form a comprehensive view on the creditworthiness. The complete financial and operational conditions of customers are not always available to us, and we may not be in any position to obtain such information. As a result, if any of our major customers experience any financial difficulty and fail to settle the outstanding amounts due to us in accordance with the agreed credit terms, our working capital position may be adversely affected.

 

We face risks associated with seasonal fluctuations in demand.

 

Our sales of finished garment products are generally highest from August to December, and we expect to continue to experience seasonal fluctuations. Therefore, our operating results for a certain period within a calendar year, or between any interim periods, may not correctly indicate our performance for the entire calendar year. Prospective investors should be aware of this seasonal fluctuation when making any comparison of our operating results.

 

Labor or other disruptions at ports or our suppliers or manufacturers may adversely affect our business.

 

Our business depends on our ability to source and distribute products in a timely and cost-effective manner. As a result, we rely on the free flow of goods through open and operational ports worldwide and on a consistent basis from our suppliers and manufacturer. Labor disputes and disruptions at various ports or at our suppliers or manufacturer could create significant risks for our business, particularly if these disputes result in work slowdowns, decreased operations, lockouts, strikes or other disruptions during our peak importing or manufacturing seasons. For example, COVID-19 has resulted in delays and disruptions at ports due to workforce decreases, shipping backlogs and capacity constraints, container shortages and other disruptions. This has resulted, and may continue to result, in slower than planned deliveries of inventory and delayed sales to customers. If we experience significant delays or disruption in receiving and distributing our products, this could have an adverse effect on our business, potentially resulting in cancelled orders by customers, unanticipated inventory accumulation or shortages, increased expense (including air freight) to deliver our products and reduced net revenues and net income or higher net loss.

 

Inconsistent quality control may adversely affect our reputation and customer relationships.

 

Our customers have specific requirements for their apparel products, and these requirements could change from one carton to another, even for the same types of products with the same design. We rely on our internal quality control personnel to inspect the finished goods and rectify any defectiveness so that the goods can be delivered to our customers in a form that would meet their quality expectations. If we fail to meet the specifications of our customers, we may not be able to monitor the quality of our suppliers at all times. For apparel products that do not satisfy the quality standards or our customers’ specifications, we may be forced to provide products to our customers on a delayed basis or cancel their order, our reputation in the industry and customer relationships would be adversely affected, and we may suffer from loss of sales and be exposed to commercial claims.

 

Our profit margin may be adversely affected by the increasing costs of raw materials and labor.

 

Changes in the costs of raw materials or labor indirectly affect our cost structure. We utilize third-party contract manufacturers to produce all of our apparel products. Any increase in production costs, including procurement costs for raw materials and increases in labor costs, may be passed on to us, while we may not be able to pass on all or any part of the subsequent increase in costs to our customers, which may have a material adverse effect on our financial performance.

 

We do not enter into long-term contracts with our suppliers. We usually enter into fixed-price contracts with our suppliers, including those for raw materials concurrently with our acceptance of each customer order, but in some cases a short time gap may be inevitable. In cases where we outsource procurement of raw materials to our contract manufacturers, rising raw material costs may be passed onto us by our contract manufacturers and put pressure on our profit margin. Any increase in the wage of workers in the apparel manufacturing industry and capital expenditures to enhance working conditions could increase the operating costs of our suppliers causing them to increase our contract prices. If we are not able to control our costs and/or pass on such additional costs to our customers or allocate such production work to other suppliers of similar quality at comparable terms, our profit margin could decrease, and we could record losses in some of our projects.

 

17

 

 

We face keen competition from other players in the market.

 

The apparel supply chain services industry in Hong Kong and the apparel retail industry in the UK has a large number of participants, which makes the industry highly fragmented and competitive. We compete with other companies on the basis of service quality and pricing. Some of our competitors may have more variety of services, greater pricing flexibility, better in house technology, stronger brand recognition, longer operating history and a more established customer base. As a result, these competitors may have greater credibility with our potential customers in our target market segments. They may have greater resources to support their service and product offerings, such as better in-house technology infrastructure, stronger brand and pricing flexibility. Unless we remain competitive, we may face increasing pricing pressure and gradual loss of our orders and customers.

 

We are dependent on our key executives, management team and professional staff.

 

We have a team of experienced and competent management who is responsible for overseeing financial condition and performance, allocating and budgeting human resources and formulating business strategies. For example, each of Ms. Eva Yuk Yin Siu and Ms. Man Chi Wai, the founders of Operating Subsidiaries, has over 30 years of experience in the fashion garment industry. Leveraging on their experience and network in the industry, we have been successfully expanding our client base and source of deals and transactions. However, we cannot assure you that we can retain the services of our key executives, personnel and members of our management team and find suitable replacements if any of them terminates his or her engagement with us, given the intense competition for experienced and competent personnel in the industry.

 

Apart from our senior management, we also rely on our professional staff in different business operations to implement our business strategies, provide quality services to clients, manage our compliance and risks, identify and capture business opportunities, maintain relationship with clients and procure new clients. Loss of our professional staff and failure to recruit replacement will materially and adversely affect our business operations.

 

We may be unable to obtain sufficient funding on terms acceptable to us, or at all.

 

The future expansion of our business may require us to incur additional borrowings and diversify sources of funding. Whether we are able to raise additional capital at costs acceptable to us depends on the financial success of our current business and the successful implementation of our key strategic initiatives. This may be affected by various financial, economic and market conditions and other factors, some of which are beyond our control. If we are unable to obtain sufficient banking facilities on acceptable terms to meet our operational and expansion demands, this may put strains on our cash flow and our ability to successfully implement our expansion plans.

 

Our insurance coverage may be inadequate to protect us from potential losses.

 

We may not be fully insured for our losses under our current insurance policies in place. We do not maintain any business interruption or key person life insurance. Our trade credit insurance may not be sufficient to cover all of our losses in the event of non-payment. There are certain types of losses, such as from war, acts of terrorism and certain natural disasters, for which we cannot obtain insurance at a reasonable cost, or at all. If any of these occurs, it may result in us incurring substantial losses and the diversion of our resources, which are not covered by our insurance. It may in turn materially and adversely affect our business and financial condition.

 

We or our Operating Subsidiaries may be subject to litigation, arbitration, or other legal proceeding risk.

 

We or our Operating Subsidiaries may be subject to arbitration claims and lawsuits in the ordinary course of our business. As of the date of this report, neither we nor our Operating Subsidiaries are a party to, or are aware of any threat of, any legal proceeding that, in the opinion of our management, is likely to have a material adverse effect on our business, financial condition or operations. Actions brought against us may result in settlements, awards, injunctions, fines, penalties, and other results adverse to us. A substantial judgment, settlement, fine or penalty could be material to our operating results or cash flows for a particular period, depending on our results for that period, or could cause us significant reputational harm, which could harm our business prospects.

 

Our services depend on the reliability of computer systems maintained by us and our outsourcing vendors and the ability to implement, maintain and upgrade our information technology and security measures.

 

Our services depend on the reliability of computer systems maintained by us and our outsourcing vendors to operate efficiently and reliably at all times. Certain emergencies or contingencies could occur, such as a natural disaster or a significant power outage, which could temporarily shut down our facilities and computer systems. Further, our Operating Subsidiaries’ servers may be subject to computer viruses, hacking, vandalism, physical or electronic break-ins and other disruptions, which could lead to a loss of data. In addition, if the technological and operational platforms and capabilities become outdated, we will be at a disadvantage when competing with our competitors. In addition, our failure to back up our data and information in a timely manner may cause material disruption of our business operation and may therefore adversely affect our business and results of operations.

 

18

 

 

We may be unable to successfully implement our future business plans and objectives.

 

Our success is dependent on, among other things, our proper and timely execution of our future business plans. Our future business plans may be hindered by factors beyond our control, such as competition within the industry we operate, our ability to cope with high exposure to financial risk, operational risk, market risk and credit risk as our business and customer base expands and our ability to provide, maintain and improve the level of human and other resources in servicing our customers. As such, we cannot assure that our future business plans will materialize, or that our objectives will be accomplished fully or partially, or our business strategies will generate the intended benefits to us as initially contemplated. If we fail to implement our business development strategies successfully, our business performance, financial condition and future prospects and growth could be materially and adversely affected.

 

We may in the future pursue acquisitions and joint ventures as part of our growth strategy. Any future acquisition or joint venture may result in exposure to potential liabilities of the acquired companies and significant transaction costs, and also may present new risks associated with entering additional markets or offering new products or services and integrating the acquired companies or newly established joint ventures. Moreover, we may not have sufficient management, financial and other resources to integrate companies we acquire or to successfully operate joint ventures, and we may be unable to profitably operate our expanded company structure. Additionally, any new business that we may acquire or joint ventures we may form, once integrated with our existing operations, may not produce expected or intended results.

 

Our internal control system may become ineffective or inadequate.

 

We rely on our internal control system to ensure effective business operations. We have established, maintained and relied on an internal control system comprising a series of policies and procedures. There is no assurance that the internal control system in place will prove at all times adequate and effective to deal with all the possible risks given the fast changing financial and regulatory environment in which we operate. We cannot assure that our internal control system has no deficiencies or inherent limitations, or that it can fully prevent us from our employee misconduct. Such deficiencies or inherent limitations may adversely affect our financial condition and results of operations.

 

A sustained outbreak of the COVID-19 pandemic could have a material adverse impact on our business, operating results, and financial condition.

 

Since late December 2019, the outbreak of a novel strain of coronavirus, later named COVID-19, spread rapidly throughout China and later to the rest of the world. On January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization declared the outbreak a PHEIC, and later on March 11, 2020, a global pandemic. The COVID-19 outbreak has led governments across the globe to impose a series of measures intended to contain its spread, including border closures, travel bans, quarantine measures, social distancing, and restrictions on business operations and large gatherings. While the spread of COVID-19 was substantially controlled in 2021, several variants of COVID-19 have emerged in different parts of the world and restrictions were re-imposed from time to time in certain cities to combat sporadic outbreaks. For instance, in early 2022, there was an uptick in cases in Shanghai, China, caused by the highly contagious Omicron variant. The outbreak in Shanghai spread to many other provinces and cities in China, where the contract manufacturers we use to produce all of our products are located. Travel restrictions and other limitations were imposed in various places across China in response to these new cases. Given the rapidly expanding nature of the COVID-19 pandemic, we believe that COVID-19 has impacted and will likely continue to impact our business, results of operations, and financial condition.

 

This outbreak of COVID-19 has caused companies like us and our business partners to implement temporary adjustments to work schedules and travel plans, mandating employees to work from home and collaborate remotely. As a result, we may have experienced lower efficiency and productivity, internally and externally, which may adversely affect our service quality. Moreover, our business depends on our employees. If any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business.

 

19

 

 

Furthermore, our results of operations have been severely affected by the COVID-19 outbreak. Due to the instability of global financial markets and other economic and financial challenges brought about by COVID-19, our businesses and clients have been adversely affected by travel restrictions preventing travel from and to Hong Kong. More broadly, the COVID-19 outbreak threatens global economies and has caused significant market volatility and declines in general economic activities. This may have severely dampened the confidence in global markets and potential clients.

 

Any future impact on our results of operations will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 pandemic and the actions taken by government authorities and other entities to contain the spread or treat its impact, almost all of which are beyond our control. Given the general slowdown in economic conditions globally, volatility in the capital markets as well as the general negative impact of the COVID-19 outbreak on the apparel solutions services market, we cannot assure you that we will be able to maintain the growth rate we have experienced or projected. We will continue to closely monitor the situation throughout 2023 and beyond.

 

Global climate change and related legal and regulatory developments could negatively affect our business, results of operations, liquidity, and financial condition

 

The effects of climate change resulting from increased concentrations of carbon dioxide and other greenhouse gases in the atmosphere, such as droughts, heat waves, flooding, wildfires, increased storm severity, sea level rise, and power outages or shortages, particularly in certain regions in which we operate, may materially adversely impact our business. China, where a significant portion of our manufacturing operations are conducted through contract manufacturers, is presently undergoing the worst heat wave in 60 years while also contending with a prolonged drought drying up reservoirs and crippling hydropower stations. This has resulted in power shortages and factories having to cease or limit their production operations. While the Company has not experienced any disruptions in the operations of its contract manufactures, any such disruptions could have a material adverse effect on its business, operations, liquidity, and financial condition.

 

A severe or prolonged downturn in the global economy, whether caused by economic or political instability, could materially and adversely affect our business and results of operations.

 

The recent global market and economic crisis stemming from COVID-19 resulted in recessions occurring in most major economies. Continued concerns about the systemic impact of potential long-term and wide-spread recession, energy costs, geopolitical issues, sovereign debt issues, COVID-19 and new variants thereof and the availability and cost of credit have contributed to increased market volatility and diminished expectations for economic growth around the world. The difficult economic outlook has negatively affected businesses and consumer confidence and contributed to significant volatility.

 

There is continuing uncertainty over the long-term effects of the expansionary monetary and fiscal policies that have been adopted by the central banks and financial authorities of some of the world’s leading economies, including Hong Kong’s. There have also been concerns over unrest in several geographic areas, which may result in significant market volatility. Any prolonged slowdown in the global and/or Hong Kong economy may have a negative impact on our business, results of operations and financial condition, and continued turbulence in the international markets may adversely affect our ability to access the capital markets to meet liquidity needs.

 

The business of our Operating Subsidiaries is substantially concentrated in North America where one customer in Canada accounted for approximately 71.3%, 91.4% and 94.5% of our revenues for the years ended December 31,2023, 2022 and 2021 and is therefore heavily dependent on the North American economy.   Economic conditions in North America are sensitive to global economic conditions. If there is any significant decline in the North American economy and we are unable to generate business in other geographic locations, our revenue, profitability, and business prospects will be materially affected. Also, major market disruptions and adverse changes in market conditions and uncertainty in the regulatory climate worldwide may adversely affect our business and industry or impair our ability to borrow or make any future financial arrangements.

 

The war in Ukraine has affected global economic markets, and the uncertain resolution of this conflict could result in protracted and/or severe damage to the global economy. Russia’s military interventions in Ukraine have led to, and may lead to, additional sanctions being levied by the United States, European Union and other countries against Russia. Russia’s military incursion and the resulting sanctions could adversely affect global energy and financial markets and thus could affect our client’s business and our business, even though we do not have any direct exposure to Russia or the adjoining geographic regions. The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described in this section. We cannot predict the progress or outcome of the situation in Ukraine, as the conflict and governmental reactions are rapidly developing and beyond their control. Prolonged unrest, intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity, and business outlook of our business.

 

20

 

 

ITEM 4. INFORMATION ON THE COMPANY

 

A. History and Development of the Company.

 

Historical Structure

 

NCI, incorporated in July 2021 under the laws of the Cayman Islands, is the holding company of our Operating Subsidiaries, Neo-Concept HK, and Neo-Concept UK. Through our Operating Subsidiaries, NCI is a one-stop apparel solution services provider, offering a full suite of services in the apparel supply chain, including market trend analysis, product design and development, raw material sourcing, production and quality control, and logistics management serving the European and North American markets.

 

Prior to a restructuring in 2021, our Operating Subsidiaries were part of NCH, a consortium of vertically integrated companies that provide a full range of garment supply chain services including but not limited to garment trading and manufacturing, retail, and apparel solution services. With operations across Hong Kong, China, East Asia, UK, Europe, and North America, NCH was and still is under the common control of our Controlling Shareholder, who both restructured the business of NCH and founded NCI. To avoid any potential conflicts of interest due to the common control, NCI, Splendid Vibe Limited, Ample Excellence Limited and Neo-Concept (BVI) Limited, the holding companies of NCH, have entered into an Exclusive Territory and Non-Competition Agreement (“Agreement”) which identifies their respective exclusive geographic areas of operations and addresses NCH’s existing customers. See “Corporate History and Structure — Exclusive Territory and Non-Competition Agreement.”

 

As part of the reorganization prior to the listing, on October 29, 2021, NCI acquired all the shares of NCA from the Controlling Shareholder and Ms. Man Chi Wai and became the holding company of NCA, Neo-Concept HK, Neo-Concept (NY) Corporation and Neo-Concept UK. Neo-Concept (NY) Corporation, a wholly owned subsidiary of Neo-Concept HK, had no significant operations during the two years ended December 31, 2020, and 2021 and on November 12, 2021, Neo-Concept HK disposed of all the shares of Neo-Concept (NY) Corporation to Neo-Concept (BVI) Limited, an affiliated company controlled by the Controlling Shareholder.

 

21

 

 

Neo-Concept International Group Holdings Limited’s Offices

 

Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong. Our telephone number is ([phone]. Our registered office in the Cayman Islands is located at the office of Osiris International Cayman Limited, Suite #4-210, Governors Square, 23 Lime Tree Bay Avenue, PO Box 32311, Grand Cayman KY1-1209, Cayman Islands.

 

Our agent for service of process in the United States is Cogency Global Inc., located at 122 East 42^nd Street, 18^th Floor New York, NY 10168. Our website is located at http://www.neo-ig.com. Information contained on, or that can be accessed through, our website is not a part of, and shall not be incorporated by reference into, this report.

 

B. Business overview

 

Overview

 

NCI is a one-stop apparel solution services provider. We offer a full suite of services in the apparel supply chain, including market trend analysis, product design and development, raw material sourcing, production and quality control, and logistics management serving customers located in the European, and North American markets through Neo-Concept HK. As we are involved from the initial stages of the development process, we strive to use sustainable solutions to fulfill our customers’ needs. Our process begins by conducting market trend analysis to identify changes in fashion trends. We discuss with customers their requirements for the upcoming season and pitch various designs having considered emerging trends and our customer’s needs. We utilize technology to iterate samples which both reduces waste and allows us to speed up the overall development process. We engage a contract manufacturer to produce prototypes and once a design is finalized, we proceed to bulk production. During production, we closely monitor the production schedule and conduct quality control on the finished product before it is finally delivered to our customer.

 

We are committed to reducing our environmental impact through recycling, clean processes, traceable sourcing and other eco-friendly practices.

 

In 2000, Neo-Concept UK began to sell apparel products in the UK under the licensed brand “les 100 ciel” through its retail stores.

 

Our Competitive Strengths

 

We believe that the following strengths distinguish us from our competitors and have contributed to our success:

 

A focus on sustainability

 

Our founders, Ms. Siu and Ms. Wai, have decades of experience creating sustainable apparel which we believe sets us apart and grants us unique expertise in the apparel services industry. We have a strong commitment to sustainable practices. For example, we require raw material suppliers to implement clean and ethical processes for sourcing and producing natural fibers such as merino wool and cashmere.

 

We have also focused on creating a cleaner and more ethical process for the production of our cashmere products. We require our cashmere fibers to be sourced from ethical farms in Inner Mongolia and for each step in the production to be documented for maximum transparency amidst growing concerns of worker abuse. To reduce chemical dyeing and clean water consumption in our processes, we also advocate for the use of recycled cashmere and undyed cashmere. We are a member of the Textile Exchange, a non-profit organization based in the U.S., with the mission to promote the sustainable development of the entire textile value chain, and strictly observe the technical and social compliance global standards in all the factories and partner facilities we utilize. We have been certified by the Textile Exchange under the Responsible Wool Standard (RWS) for our supply chain. This standard is used to track the wool used in our products through the chain of custody in order to preserve the identity of the material and its movements through our supply chain up to the final product.

 

22

 

 

Given the recent emphasis on climate change and sustainability, green brands are thriving, and more retailers are incorporating sustainable practices into their production. This is a trend that we believe will continue across the North American, UK and European markets. As a result, demand for our services has grown and we have developed various lines of products with our customers utilizing eco-friendly materials and processes. To showcase our commitment to sustainable practices, we have also applied for and received certifications/registrations under the:

 

●

Global Recycled Standard 4.0 (a global product standard primarily related to tracking and verifying the content of recycled raw materials through the supply chain);

 

●

Organic Content Standard 3.0 (an international standard that provides chain of custody verification for materials originating on a farm certified to recognized national organic standards);

 

●

Global Organic Textile Standard 6.0 (a global standard with requirements to ensure organic status of textiles from harvest of raw materials, to manufacturing and labelling, up to the product reaching the end customer); and

 

●

Better Cotton Initiative Platform (an online system owned by the Better Cotton Initiative used to electronically document volumes of cotton sourced as “Better Cotton” as they pass through the supply chain).

 

We believe our certifications will increase our favorability with and ability to attract a wider spectrum of customers in the future. See “Business — Our Business Operations — Raw Material Sourcing” for further details. These certifications will also facilitate the transition by NCH to us of existing NCH clients that are within our exclusive territory and that require such certifications for us to provide products and services to them. See “Corporate History and Structure — Exclusive Territory and Non-Competition Agreement”.

 

Close relationships with our major customers and strategic partners

 

Our relationship with our top customer, a prominent retailer based in Canada, has been crucial to our current success. We have worked with this customer on a recurring basis since 2012. As they have grown, we have been able to increase both the scale and volume of the services and products provided to them.

 

As a strategic partner to our core customers, we provide brands with a variety of affordable luxury apparel products and the full spectrum of apparel supply chain solution services.

 

In addition, by working closely with our core customers, we are able to push forward otherwise unfeasible initiatives. For example, one of our top customers is cooperating with us on a new recycling project to recover boiled wool waste during production and recycle this into material that can be used in new production runs. By creating a circular production process, we have reduced waste and helped the customer meet their sustainable growth goals. We have also worked with various brands as an original design manufacturer to help them meet their sustainability goals.

 

We provide one-stop apparel solution services

 

Our strength as a one stop apparel solution services provider is our ability to offer our customers a simplified and comprehensive supply chain experience. Our services cover every step from initial design concepts, sourcing, manufacturing, to quality assurance, packaging, and logistics. With the design, planning, execution, control, and monitoring of supply chain activities we offer a competitive infrastructure for customers. Customers are provided with solutions along the supply chain in an efficient and cost-effective manner, so they are able to prioritize their own core competencies and business objectives.

 

23

 

 

Our management members have deep industry knowledge and proven track records

 

Our management members bring with them an average of over 30 years of experience in the apparel industry having co-founded NCH in 1990. Ms. Siu, the co-founder of our Operating Subsidiaries, chairlady of our board of directors, and our chief executive officer, focuses on our development plan and business strategy. She has over 30 years of management, business and marketing and operating experience in apparel manufacturing and trading. Ms. Wai, the co-founder of our Operating Subsidiaries, is mainly responsible for operational efficiency and achievement. She has over 30 years of experience in the garment industry and is actively involved in the garment sourcing and trading business. We believe that our cohesive corporate culture inspires innovation, motivates quality service and encourages collaboration. The collective industry knowledge and skills of our management give us the capability to manage risks, respond timely to market trends, and capture lucrative market opportunities. We believe the in-depth industry experience, knowledge of supply chain management and established connections with customers of our management differentiate us from our competitors.

 

Our Strategies

 

Our aim is to further strengthen our market position and continue to be a competitive apparel solution services business by pursuing the following key strategies:

 

Strengthen our design and development capabilities

 

We consider our ability to develop designs according to the latest fashion trends and styles crucial to our success in the industry. Our design and development team conducts market trend analysis on the latest fashion trends and works with our customers to produce custom designs. To further enhance our design and development capabilities, we intend to expand our design and development team. By strengthening our design and development capabilities, we aim to incorporate more sustainable materials into product components in our design and development stage in the future.

 

Integrate sustainability into product sourcing and environmental marketing

 

One of our goals is to integrate sustainability into every aspect of our business model. We have had success adopting innovative sustainability concepts, for instance, requiring manufacturers to use recycled materials in the production line, such as wastage from spinning and production processes. We will seek to identify opportunities to further reduce our environmental footprint, especially in areas that are in sync with the priorities of our customers. In addition, we integrate environmental marketing into consultations with customers, providing guidance and recommendations on how to meet sustainability goals. We have had success in offering eco-friendly yarn compositions and using recycled, regenerated, and traceable yarn products that fall within customers’ budgets and specification.

 

To showcase our commitment to sustainable practices, we have also applied for certifications under the Global Recycled Standard 4.0, the Organic Content Standard 3.0, the Global Organic Textile Standard 6.0, and have been registered as a user of the Better Cotton Platform. We believe this will increase our appeal and ability to attract a wider spectrum of customers in the future.

 

Broaden our customer base and work together with our customers to expand our product mix and maintain customer relationships

 

We expect demand for our apparel services to continue to grow as retailers and consumers are increasingly conscious of ethical consumerism and environmental, social and governance (“ESG”). Our goal is to position ourselves as a leading provider of sustainable apparel solution services and be the first choice for brands seeking to “go-green” in North America and Europe. As our customers continue to grow, we will bring our expertise and creative vision to enhance and expand our existing product mix. We will also increase the frequency of our liaison with existing customers to better understand their needs and enhance our tailor-made apparel solution services. We will continue to broaden the range of apparel products handled by us and strengthen our design and development capabilities in different categories, so that we can tap into new markets and attract new customers.

 

24

 

 

Acquisition of companies and/or formation of joint ventures

 

We intend to acquire stakes in companies and/or forming joint ventures with potential business partners, with a view to support the business growth of our Group and diversify our revenue sources. We have not identified any targets for the potential acquisition or joint ventures as of the as of the date of this report.

 

While we have not identified any specific targets, we plan to selectively pursue acquisitions and formation of joint ventures that complement our existing operations, facilitate our business strategies as well as strengthening our products, enhancing our production capabilities and/or expanding our market presence in our core markets, in order to maximize the potential value and capability of our Company. Our potential targets for acquisition and formation of joint venture will focus on companies with business and products that will enhance our market share and bring synergic effect to our business. We will select potential targets based on various factors including each candidate’s market share, reputation and customer base.

 

OUR BUSINESS OPERATIONS

 

We are a one-stop apparel solution services provider. We offer a full suite of services in the apparel supply chain, including market trend analysis, product design and development, raw material sourcing, production and quality control, and logistics management. Through Neo-Concept HK, our Operating Subsidiary established in Hong Kong, we provide our apparel solution services to our customers located in North America and Europe. Our 360 degree supply chain services deliver value at each stage of the process.

 

The following diagram illustrates the operation flow of our 360 degree supply chain services:

 

 

We handle a wide range of apparel products which can be categorized as finished garments. Each series of apparel products handled by us is arguably unique, as they are manufactured according to our customers’ specifications.

 

Market Trend Analysis

 

Our goal is to keep abreast of the changes in global fashion trends and the local market response to different styles. We meet with online fashion retailers, textile manufacturers and apparel sourcing agents regularly to deepen our understanding of the market, budgets, and seasonal designs.

 

We capitalize on our market intelligence to formulate our business plan for seasons ahead. Our seasonal business plan usually involves strategic procurement of raw materials, especially natural fibers, and creation of design sketches responsive to consumer preferences for the season.

 

25

 

 

Product Design and Development

 

We have an in-house design team with in-depth technical apparel know-how and experience in the fashion industry. They produce seasonal collections to inspire customers with ideas on design, trends, materials, and techniques that fit a customer’s brand ethos. Alternatively, we work to meet the specifications of a customer’s own designs to deliver products based on the customer’s budget and timeframe.

 

We typically go through a process of using software to render virtual samples to our customers and through a number of iterations identify a product design that fits their needs and specifications. Alternatively, customers can submit their own design, in which case we will make modifications so that the apparel product can be produced within their budget and other specifications, such as incorporating the use of sustainable materials. Some customers present their concept to us, and we collaboratively generate the design based on their concept and make modifications to the design together.

 

Raw Material Sourcing

 

We require our contract manufacturers to source raw materials from select third party vendors that possess certain certifications to guarantee they meet international standards and individual customer needs. Neo-Concept HK has obtained the following industry certifications:

 

Certification		Validity		Description
Responsible Wool Standard (“RWS”)		May 12, 2024		RWS is a tool to ensure that wool comes from sheep that have been raised with respect to the ‘Five Freedoms’, that the land has been managed responsibly, and to provide a robust chain of custody system to validate the source of the material for all product claims.   The Five freedoms:   1. The freedom from hunger and thirst; 2. The freedom from discomfort; 3. The freedom from pain, injury or distress; 4. The freedom to express normal behavior; and 5. The freedom from fear and distress.
Global Recycled Standard (“GRS”) 4.0		August 8, 2024		The GRS is a full product standard to verify and track recycled raw materials through the supply chain. It also includes processing criteria to prevent the use of potentially hazardous chemicals and verifies positive social or environmental production at the facilities. The GRS uses the chain of custody requirements of the Content Claim Standard (“CCS”). The goal of the GRS is to increase the use of recycled materials in products and reduce/eliminate the harm caused by its production.
Organic Content Standard (“OCS”) 3.0		August 8, 2024		OCS is an international, voluntary standard that sets requirements for third-party certification of certified organic input and chain of custody. The goal of the OCS is to increase organic agriculture production.
Global Organic Textile Standard (“GOTS”) 6.0		October 4, 2023		GOTS was developed by leading standard setters to define world-wide recognized requirements for organic textiles. From the harvesting of the raw materials, environmentally and socially responsible manufacturing, to labelling, textiles certified to GOTS provide a credible assurance to the consumer.
Better Cotton Platform (“BCP”)		May 31, 2024		BCP is an online system owned by the Better Cotton Initiative (a cotton sustainability program aiming to transform cotton production by developing Better Cotton as a sustainable mainstream commodity) used by more than 9,000 ginners, raders, spinners, fabric mills, garment and end product manufacturers, sourcing agents and retailers to electronically document volumes of cotton sourced as “Better Cotton” as they pass through the supply chain. Access to the BCP allows organizations to participate electronically in the Better Cotton Chain of Custody by recording information about cotton-containing orders sourced as Better Cotton, managing the required documentation, and recording information about cotton-containing sales to customers.

 

26

 

 

We have quality control procedures in place to evaluate the performance of raw materials used by our contract manufacturers throughout the production process. Our evaluation is based on a number of factors, including sustainability efforts, technical capabilities, quality, manufacturing capacity, industry reputation, years of experience, timely delivery records, costs and payment terms. We perform laboratory tests on random samples and perform on-site inspections on the raw materials used in the manufacturing process to ensure they comply with international standards as well as our customer specifications.

 

The raw materials used in our products consist of merino wool, cashmere, cotton, leather, and other synthetic materials, including a variety of sustainable, innovative, and ethically sourced materials such as recycled nylon. Recycled nylon is made from the wasted fishing nets from deep-sea fishing activities and reused as raw material for textiles. The ghost fishing nets are regenerated and produced by zero-carbon factories, which can be applied to all types of yarns and fabric. It can be recycled physically and chemically, also being proven its biodegradability.

 

 

Production Management and Quality Control

 

We do not own or operate any manufacturing operations and all of our apparel products (including sample products and finished goods) are produced by contract manufacturers. As part of our apparel solution services, we are responsible for the overall production management, monitoring of production schedule, evaluation of manufacturing services and conducting quality control on finished goods. During the production process, we regularly communicate with manufacturers and check their production schedule to ensure that they are able to deliver the finished goods on time. We also perform on-site quality inspections regularly on raw materials, semi-finished products, and finished products for quality control purposes.

 

We have stringent quality control procedures throughout the supply chain. Our staff are trained to implement our Total Quality Management System (TQM). This system is integrated with InspectLink software to ensure that garments are inspected throughout the entire manufacturing process, from material development and sampling to production and the final garments. If any defect is found, we will require suppliers to rectify the defects.

 

As part of our sustainability efforts, we monitor the market to identify new innovative materials and processes that can help to reduce the environmental footprint of our production, whether it be carbon emissions, water consumption or waste pollution.

 

27

 

 

For example, by adopting processes such as the Dry Dye™ (also known as ZERO-D® dyeing solution) we can achieve a water-based printing solution for a number of our textiles with zero polluted water discharge and reduction of water usage by over 99%.

 

Logistics Management

 

Our logistics management services cover every movement of inventory in our customers’ supply chain. We rely on third party service providers or our contract manufacturer for transportation services to the port of destination or our customers warehouse and keep track of the process to monitor the whereabouts of the inventory to ensure it is delivered within the timeline specified by the customer.

 

RETAIL SALES OF BRANDED APPAREL PRODUCTS

 

Our own brand of apparel products mainly consists of knitwear sold under the licensed brand “les 100 ciels.” We drive sales through a mix of digital and physical retail locations. Our retail operations in the UK are conducted through Neo-Concept UK, our Operating Subsidiary established in the UK.

 

 

In addition to our three physical stores in the UK and our website, we also sell our apparel products through third party online platforms to leverage our digital exposure. We utilize Wolf & Badger, which is based in the UK, to help drive growth in the UK. Our apparel products sold under the “les 100 ciels” brand consists mainly of knitwear made from cashmere.

 

 

les 100 ciels womenswear

 

28

 

 

By selling direct to consumer we can also avoid the costs associated with traditional wholesalers, creating a more efficient cost structure and higher gross margin, which we believe allows us to deliver more affordable products and a better experience to customers. We believe our model enables us to provide high-quality products priced lower compared to a traditional wholesale model.

 

CUSTOMERS

 

Our customers mainly include brand owners, apparel sourcing agents and online fashion retailers, primarily located in North America and Europe. We have a particularly strong customer base in Canada and the U.S. which accounts for over 94% of total revenues, and we maintain stable and ongoing business relationships with all our major customers.

 

Our top customer is a Canadian based retailer listed on the Toronto Stock Exchange which contributed approximately 71.3%, 91.4% and 94.5% of our revenue for the years ended December 31, 2023, 2022 and 2021, respectively. Neo-Concept HK has been providing our apparel solution services to our top customer since 2012. During this time, it has expanded the service scope to cover a wider range of products. We currently work with seven brands/sub-brands of our top customer, each with its distinct brand identity and which spans across different product categories, including knitwear, woven, cut, and sewn fine knits and a variety of accessories. Although our customer concentration is extremely high, we believe this is a natural result of our business strategy to grow and expand our product offerings organically along with our customers.

 

Our goal is to work collaboratively with our customers on a long-term basis to create and expand our product offering and position ourselves as a vital partner in the development process. We will continue to strengthen our design and development capabilities and expand our product and service offerings to our customers for every new season. We will also aim to diversify our customer base and revenue source, by expanding both online and offline retail sales of the “les 100 ciels” products.

 

We do not enter into long-term agreements with our customers, which we believe is in line with market practice.

 

SUPPLIERS

 

We have two principal suppliers, (i) NCH, an affiliated company controlled by our Controlling Shareholder, and (ii) an independent third party based in Hong Kong with manufacturing facilities in Mainland China, which we have engaged to produce the majority of apparel products for and arrange delivery to our customers during the years ended December 31, 2023, 2022 and 2021. We selected these suppliers due to their performance based on a pre-defined set of criteria, including size, quality, reputation, price, and on-time delivery records.

 

For the years ended December 31, 2023, 2022 and 2021 our two principal suppliers together accounted for 93.9%, 80.1% and 100% of our total purchases, respectively. We believe it is common for market participants in the apparel supply chain industry to establish reliance on a few suppliers. Establishing and maintaining long-term strategic partnership with strong suppliers with proven capability and the capability to handle a breadth of product categories allow us to enhance our own product offerings and be more competitive in the market.

 

We do not enter into any long-term supply agreements with our suppliers, which we believe is in line with market practice.

 

PRICING

 

Our revenue is mainly generated from North America and Europe, and our products are quoted in US$. We usually adopt a cost-plus pricing strategy and generally price our apparel services based on the following factors: (i) nature of raw material; (ii) complexity of design; (iii) quotations from third party suppliers, such as costs of raw materials, contract manufacturing services and transportation; (iv) volume of order; (v) timing requirements; (vi) retail price of similar apparel products in the market; and (vii) profit margin within the industry.

 

Our retail sales of branded products are also priced based a cost-plus pricing model.

 

29

 

 

PRODUCT RETURN

 

Sales of private-labelled apparel products

 

We do not have a product return or warranty policy for our finished garments. Customers have the right to inspect the finished goods before delivery for defects and deviation from specifications. We do not assume the risk of damages or losses after the finished goods are delivered to the place designated by our customers. To maintain long-term business relationship with our customers, we follow up after completion of a given project to solicit feedback.

 

Retail sales of own-branded apparel products

 

For sales of our “les 100 ciels” products through our physical and digital channels, we provide a 28 day return window to our customer for unworn apparel, and a credit note to the value of the items for up to 35 days.

 

For the years ended December 31, 2023, 2022 and 2021, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers.

 

MARKETING

 

We implement a number of marketing and promotion measures to source new customers. Our new customers are primarily referrals from our existing customers which, in our view, is a reflection of their satisfaction with our services. We also utilize our business network for introductions to new partners and customers. Our strategy is to fully understand our customers product and services requirements and work together to achieve their needs in a cost-effective way. Our marketing activities also involve creating seasonal sales tools to demonstrate our capabilities, as well as inspire our customers with trend infographics and an in-house collection demonstrating our technical ability and designs. We use these during face-to-face meetings, to allow our customer to understand our latest design collections and significantly enhance customer experience with us.

 

SEASONALITY

 

The apparel market exhibits seasonality with dynamic changes in trends and consumers’ preferences depending on the time of year. Apparel sales are generally highest from August to December, mainly attributable to climate and frequent online sales events during these months. The aggregate sales generated in these months accounted for approximately 33.5% and 65.4% of our total revenue for the years ended December 31, 2022 and 2021, respectively. However, for the year ended December 31, 2022, we observed particularly strong sales from April to July, which constituted approximately 43.7% of our total revenue. This surge in sales can be mainly attributed to increased demand for spring and summer products from our top customer.

 

COMPETITION

 

The industry in which we operate is large, fragmented and highly competitive. We face fierce competition among service providers in terms of the product design, price, quality control and delivery of products. Our competitors include other apparel service providers and one-stop garment manufacturers including our affiliate, NCH who also provides apparel solutions services to customers in North America and Europe. To avoid any potential conflicts of interest due to the common control, we have entered into an Agreement with Neo-Concept (BVI) Limited, Ample Excellence Limited, and Splendid Vibe Limited, the holding companies of NCH. Please see “Corporate History and Structure — Exclusive Territory and Non-Competition Agreement” for further details.

 

While the market is fragmented, many of our direct competitors operate at a larger scale and have substantially greater resources than us. Access to offshore manufacturing and the growth of ecommerce have made it easier for new companies to enter the markets in which we compete, further increasing competition in the already competitive apparel industry.

 

Despite the intense competition, we believe our provision of integrated supply chain solutions and value-added services places us in a strong position. Our focus on sustainable practices, innovative materials and products, and collaborative partnerships with core customers allows us to successfully compete in the industry.

 

30

 

 

COVID-19 Update

 

Since late December 2019, the outbreak of a novel strain of coronavirus, later named COVID-19, spread rapidly throughout China and later to the rest of the world. On January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization declared the outbreak a “Public Health Emergency of International Concern (PHEIC),” and later on March 11, 2020, a global pandemic. The COVID-19 outbreak has led governments across the globe to impose a series of measures intended to contain its spread, including border closures, travel bans, quarantine measures, social distancing, and restrictions on business operations and large gatherings. While the spread of COVID-19 was substantially controlled in 2021, several variants of COVID-19 have emerged in different parts of the world and restrictions were re-imposed from time to time in certain cities to combat sporadic outbreaks. For instance, in early 2022, there was an uptick in cases in Shanghai, China, caused by the highly contagious Omicron variant. The outbreak in Shanghai spread to many other provinces and cities in China, where the contract manufacturers we use to produce all of our products are located. Travel restrictions and other limitations were imposed in various places across China in response to these new cases.

 

The COVID-19 pandemic has also had and will continue to have a major impact on the retail industry and our customers. For example, in March 2020, upon declaration of the COVID-19 as a pandemic by the World Health Organization, our largest customer temporarily closed all of its retail locations in Canada and the United States according to guidelines from the local government authorities. It has since re-opened its retail locations in phases, with all locations re-opened as of July 2021.

 

Given the rapidly expanding nature of COVID-19 pandemic, we believe that COVID-19 has impacted and will likely continue to impact our business, results of operations, and financial condition.

 

The COVID-19 pandemic has caused companies like us and our business partners to implement temporary adjustments to work schedules and travel plans, mandating employees to work from home and collaborate remotely. As a result, we may have experienced lower efficiency and productivity, internally and externally, which may adversely affect our service quality. Moreover, our business depends on our employees. If any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business.

 

Furthermore, our results of operations have been severely affected by the COVID-19 pandemic. Due to the instability of global financial markets and other economic and financial challenges brought about by COVID-19. The COVID-19 pandemic threatens global economies and has caused significant market volatility and declines in general economic activities. This may have severely dampened the confidence in global markets and potential clients.

 

Any future impact on our results of operations will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 pandemic and the actions taken by government authorities and other entities to contain the spread or treat its impact, almost all of which are beyond our control. We will continue to closely monitor the situation throughout 2023 and beyond.

 

Regulations

 

Regulations Related to our Business Operations in Hong Kong

 

Hong Kong Regulations Related to Services Providers

 

Business registration requirement

 

The Business Registration Ordinance (Chapter 310 of the Laws of Hong Kong) requires every person carrying on any business to make an application to the Commissioner of Inland Revenue in the prescribed manner for the registration of that business. The Commissioner of Inland Revenue must register each business for which a business registration application is made and as soon as practicable after the prescribed business registration fee and levy are paid and issue a business registration certificate or branch registration certificate for the relevant business or the relevant branch, as the case may be.

 

As of the date of this report, Neo-Concept HK holds a valid business registration certificate.

 

31

 

 

Regulations related to employment and labor protection

 

Employment Ordinance (Chapter 57 of the Laws of Hong Kong)

 

The Employment Ordinance (Chapter 57 of the Laws of Hong Kong), or the EO, is an ordinance enacted for, amongst other things, the protection of the wages of employees and the regulation of the general conditions of employment and employment agencies. Under the EO, an employee is generally entitled to, amongst other things, notice of termination of his or her employment contract; payment in lieu of notice; maternity protection in the case of a pregnant employee; not less than one rest day in every period of seven days; severance payments or long service payments; sickness allowance; statutory holidays or alternative holidays; and paid annual leave of up to 14 days depending on the period of employment.

 

As of the date of this report, Neo-Concept HK has complied with the provisions under the EO.

 

Employees’ Compensation Ordinance (Chapter 282 of the Laws of Hong Kong)

 

The Employees’ Compensation Ordinance (Chapter 282 of the Laws of Hong Kong), or the ECO, is an ordinance enacted for the purpose of providing for the payment of compensation to employees injured in the course of employment. As stipulated by the ECO, no employer shall employ any employee in any employment unless there is in force in relation to such employee a policy of insurance issued by an insurer for an amount not less than the applicable amount specified in the Fourth Schedule of the ECO in respect of the liability of the employer. According to the Fourth Schedule of the ECO, the insured amount shall be not less than HKD 100,000,000 per event if a company has no more than 200 employees. Any employer who contravenes this requirement commits a criminal offence and is liable on conviction to a fine and imprisonment. An employer who has taken out an insurance policy under the ECO is required to display a prescribed notice of insurance in a conspicuous place on each of its premises where any employee is employed.

 

As of the date of this report, employee compensation insurance has been obtained for all employees of Neo-Concept HK.

 

Mandatory Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong)

 

The Mandatory Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong), or the MPFSO, is an ordinance enacted for the purposes of providing for the establishment of non-governmental mandatory provident fund schemes, or the MPF Schemes. The MPFSO requires every employer of an employee of 18 years of age or above but under 65 years of age to take all practical steps to ensure the employee becomes a member of a registered MPF Scheme. Subject to the minimum and maximum relevant income levels, it is mandatory for both employers and their employees to contribute 5% of the employee’s relevant income to the MPF Scheme. Any employer who contravenes this requirement commits a criminal offence and is liable on conviction to a fine and imprisonment.

 

As of the date of this report, the Company believes it has made all contributions required under the MPFSO.

 

Regulations related to Personal Data

 

Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong)

 

The Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong), or the PDPO, imposes a statutory duty on data users to comply with the requirements of the six data protection principles (the “Data Protection Principles”) contained in Schedule 1 to the PDPO. The PDPO provides that a data user shall not do an act, or engage in a practice, that contravenes a Data Protection Principle unless the act or practice, as the case may be, is required or permitted under the PDPO. The six Data Protection Principles are:

 

●

Principle 1 — purpose and manner of collection of personal data;

 

●

Principle 2 — accuracy and duration of retention of personal data;

 

●

Principle 3 — use of personal data;

 

●

Principle 4 — security of personal data;

 

●

Principle 5 — information to be generally available; and

 

●

Principle 6 — access to personal data.

 

32

 

 

Non-compliance with a Data Protection Principle may lead to a complaint to the Privacy Commissioner for Personal Data (the “Privacy Commissioner”). The Privacy Commissioner may serve an enforcement notice to direct the data user to remedy the contravention and/or instigate prosecution actions. A data user who contravenes an enforcement notice commits an offense which may lead to a fine and imprisonment.

 

The PDPO also gives data subjects certain rights, inter alia:

 

●

the right to be informed by a data user whether the data user holds personal data of which the individual is the data subject;

 

●

if the data user holds such data, to be supplied with a copy of such data; and

 

●

the right to request correction of any data they consider to be inaccurate.

 

The PDPO criminalizes, including but not limited to, the misuse or inappropriate use of personal data in direct marketing activities, non-compliance with a data access request and the unauthorized disclosure of personal data obtained without the relevant data user’s consent. An individual who suffers damage, including injured feelings, by reason of a contravention of the PDPO in relation to his or her personal data may seek compensation from the data user concerned.

 

As of the date of this report, Neo-Concept HK is in compliance with the provisions of the PDPO.

 

Regulations Related to our Business Operations in UK

 

United Kingdom Regulations Related to Retail Sales of Products

 

Sale of Goods

 

Sale of Goods Act 1979 (“SoGA”) implies a number of important terms into business to business sale of goods contracts, particularly in relation to the title to the goods and the quality of the goods. It also lays down a large number of presumptions, which, in the absence of express drafting to the contrary, apply to a business to business sale of goods contract. The key terms implied by SoGA are: (a) That the seller has the right to sell the goods (i.e. good title); (b) That the goods are free from undisclosed charges or encumbrances and that the buyer will enjoy quiet possession of the goods; (c) Where goods are sold by description, that the goods will correspond with that description; (d) Where goods are sold in the course of a business, that the goods are of satisfactory quality; and (e) Where goods are sold in the course of a business and the buyer, expressly or by implication, makes known to the seller the purpose for which they want the goods, that the goods will be reasonably fit for that purpose. SoGA entitles buyers to reject non-conforming goods and reclaim the purchase price (where already paid). Certain other provisions of SoGA will apply to business to consumer sale of goods contracts (for example regarding the point at which a contract is made under English law), but the implied terms discussed above are now included as mandatory standards in specific consumer rights legislation as set out below.

 

Consumer Rights

 

There are an extensive range of UK laws and regulations concerning consumer rights in the UK that are applicable to retail sales, including the Consumer Rights Act 2015 (“CRA”), the Electronic Commerce (EC Directive) Regulations 2002 (“E-Commerce Regs”), Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (“CCRs”) and Consumer Protection from Unfair Trading Regulations 2008 (“CPUT”). These regulations govern the sale of goods and services to UK consumers, both online and in-stores. They grant consumers a minimum standard of rights (including with regard to title, fitness for purpose, cooling-off periods, product delivery & returns and defective or misleadingly described goods) as well as imposing requirements on businesses with regard to the information that must be provided to a consumer, both prior to and after entering into a contract. The regulations also govern the way businesses market and promote consumer products, as well as their communications with consumers across all formats (whether online or in-store).

 

Data Protection

 

The key relevant regulations applicable to the processing of the data of UK citizens are the UK Data Protection Act 2018 (the “DPA”) and the retained UK version of the EU General Data Protection Regulation (the “UK GDPR”) (collectively referred to as the “DP Legislation”). The purpose of the DP Legislation is to ensure the protection of personal data of living individuals in the UK (e.g., employees, customers), to ensure such data is processed securely, fairly and transparently and to restrict the way such data is shared with third parties, including internationally. The DP Legislation also enshrines certain rights for individuals, which may be enforced against companies, including rights to access their data or have it deleted.

 

The DP Legislation includes robust penalties for non-compliance, including fines of up to 4% of an organization’s global annual turnover. The legislation requires those entities subject to it to give specific types of information and notices to data subjects (which will include customers, suppliers and its own staff) and in some cases seek consent from such data subjects before collecting or using their data for certain purposes, including but not limited to some marketing activities.

 

33

 

 

Electronic Communications

 

The Privacy and Electronic Communications Regulations 2003 (“PECR”) impose obligations on businesses with regard to any electronic communications with UK consumers. PECR sits alongside the DPA and grants individuals in the UK specific privacy rights in relation to electronic communications, including imposing specific rules on marketing calls, emails, texts, and faxes; the placing of cookies (pixels, tags and similar technologies); keeping communications services secure; and customer privacy as regards traffic and location data, itemized billing, line identification, and directory listings. The aim of the regulation is to protect consumers from unsolicited marketing and to give them greater control over the receipt of electronic marketing communications.

 

Other Key United Kingdom Regulations Applicable to UK Companies

 

Anti-Bribery & Corruption

 

The Bribery Act 2010 of the United Kingdom (the “BA”) imposes obligations on UK businesses with the aim of preventing bribery and corruption. The BA has “extra-territorial” effect with the aim of preventing the giving or receiving of bribes (including low level facilitation or “grease” payments) regardless of where such acts take place — i.e. whether in the UK or any other country in the world.

 

The BA includes a corporate offence of “failure to prevent bribery” which puts an onus on companies to have in place a set of “adequate procedures” to prevent bribery within their organization and supply chain globally — such procedures may include staff and supplier training; policies; senior level commitment; and due diligence on suppliers and associated parties. The BA creates both civil and criminal offences, while penalties for breaching the legislation include fines and imprisonment (including for directors, where a company is liable for failure to prevent bribery).

 

Modern Slavery

 

The Modern Slavery Act 2015 (the “MSA”) imposes obligations on UK businesses with the aim of preventing modern slavery both within UK businesses and their global supply chains. The MSA requires certain large organizations (with a turnover of £36 million or more) to publish an annual Modern Slavery Act Transparency Statement, the purpose of which is for such organizations to, in summary, set out the measures they have in place and provide a detailed picture of all the steps they are taking, to ensure that their business and supply chains are free of modern slavery.

 

United Kingdom Regulations Relating to Employment

 

The Employment Rights Act 1996 (“ERA”) is the primary piece of legislation which governs the relationship between Neo-Concept UK and those of its employees who work in England and Wales. The ERA regulates matters such as particulars of employment, protection of wages, whistleblowing, protection from detriment in employment, time off work, leave for maternity, paternity, and adoption, shared parental leave and parental leave, flexible working, termination of employment, unfair dismissal, redundancy and redundancy payments.

 

Neo-Concept UK is also subject to various other statutes which apply with respect to its employment arrangements in England and Wales, including (a) Working Time Regulations 1998 which covers matters such as holiday and holiday pay, working hours and rest breaks; (b) Fixed Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of fixed term employees; (c) Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2002 which covers treatment of part-time workers; (d) Equality Act 2010 which provides protection against unlawful discrimination in employment; (e) Health and Safety at Work Act 1974 which covers occupational health and safety; (f) Transfer of Undertakings (Protection of Employment) Regulations 2006 which, amongst other things, provides restrictions on varying terms and conditions of employment in connection with a transfer; (g) Trade Union and Labour Relations (Consolidation) Act 1992 which, amongst other things, provides for consultation requirements in respect of collective dismissals; (h) National Minimum Wage Act 1998 which implements a minimum hourly rate of pay set by the government that applies to all workers over compulsory school leaving age; and (i) Copyright, Designs and Patents Act 1988 and Patents Act 1977, which together create a statutory framework for employers to own the inventions and literary work made or created by their employees in the course of their employment.

 

34

 

 

C. Organizational structure.

  

The chart below illustrates our corporate structure and identifies our subsidiaries as of the date of this report:

 

 

 

Name		Background		Ownership
Neo-Concept Apparel Group Limited (“NCA”)		- A BVI company - Incorporated in August 2008 - Issued Share Capital of US$100 - Intermediate holding company		100% owned by NCI
Neo-Concept International Company Limited (“Neo-Concept HK”)		- A Hong Kong company - Incorporated in October 1992 - Issued Share Capital of HKD 100,000 - Provision of one-stop apparel solution services		100% owned by NCA
Neo-Concept (UK) Limited (“Neo-Concept UK”)		- A UK company - Incorporated in August 2000 - Issued Share Capital of GBP100 - Provision of online and offline retail sales of apparel products		100% owned by Neo-Concept HK

 

We are a “controlled company” as defined under the Nasdaq Stock Market Rules because our Controlling Shareholder owns 71.5% of our total issued and outstanding Ordinary Shares, representing 71.5% of the total voting power.

 

At each general meeting, each shareholder who is present in person or by proxy (or, in the case of a shareholder being a corporation, by its duly authorized representative) will have one vote for each Ordinary Share which such shareholder holds. There are no prohibitions to cumulative voting under the laws of the Cayman Islands, but our Memorandum and Articles of Association do not provide for cumulative voting.

 

35

 

 

Exclusive Territory and Non-Competition Agreement

 

NCH also operates as a comprehensive apparel solutions services provider in North America and Europe principally. As such, NCH is in direct competition with our business in such regions. To address this, we entered into an Exclusive Territory and Non-Competition Agreement (“Agreement”) with Neo-Concept (BVI) Limited, Ample Excellence Limited and Splendid Vibe Limited (collectively the “Parent Group”), the holding companies of NCH and other subsidiaries under the common control of our Controlling Shareholder.

 

Under the Agreement we entered into with the Parent Group, we have agreed that during the non-competition period (which will end on the later of (1) two years after the first date when our Controlling Shareholder ceases to own in aggregate at least 20% of the voting power of our then outstanding securities and (2) the fifth anniversary of the completion of our IPO) that the Parent Group and its subsidiaries, including NCH but excluding NCI Group) (the “Neo Concept Group”), will not compete with our Company in the businesses currently conducted by us through our Operating Subsidiaries in North America and Europe namely, the businesses of apparel solution services in the UK, Europe and North America (the “Protected Territories”) and retail sale of apparel products. However, since we are in the process of and have not yet obtained all of the certifications required by certain clients to guarantee that their raw material sourcing meets international standards we have agreed that Neo Concept Group shall continue to service its existing portfolio of customers in the Protected Territories that require the additional certifications provided that once NCI Group obtains and provides documentation that the necessary certifications required by a Portfolio Customer have been secured, Neo Concept Group will use its best endeavors to transfer within 45 days the Portfolio Customers to NCI Group. In the event that Neo Concept Group is unable, unsuccessful or a Portfolio Customer is unwilling to the transfer of its account to NCI Group, then NCI Group shall be entitled to receive the economic benefit inuring to Neo Concept Group from that Portfolio Customer as measured by a royalty of 10% of all sales and services by Neo Concept Group to that Portfolio Customer.

 

As of the date of this report, we have a total of 11 customers which we provide apparel solution services, each of which are not current clients of NCH and are therefore protected under the terms of the Agreement. Under the terms of the Agreement, we retain the right to sell to any of NCH’s existing portfolio of customers.

 

The Agreement also provides for a non-solicitation obligation so that NCH may not, during the non-competition period, hire, or solicit for hire, any active employees of, or individuals providing consulting services to NCI or its subsidiaries, or any former employees of, or individuals providing consulting services to NCI or its subsidiaries within six months of the termination of their employment or consulting services, without NCI’s consent, except for solicitation activities through generalized non-targeted advertisement not directed to such employees or individuals that do not result in a hiring within the non-competition period.

 

D. Property, plant and equipment.

 

We do not own any real property.

 

Our principal executive office is located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong. The office has a size of approximately 10,700 square feet. We lease our office in Hong Kong from our affiliated company, NCH. The rental was included in management fee charged to us for the years ended December 31, 2021 while for the year ended December 31, 2022, we entered into official rental agreement for the premises and accounted for the relevant cost as rental expense. See “Related Party Transactions” for details.

 

We currently lease three retail shops in London, UK, totaling approximately 3,000 square feet and an office with a size of approximately 700 square feet.

 

The following table sets out the details of the leases:

 

Property location		Approximate floor area		Lease term		Rent
10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong		10,700 square feet		January 1, 2022 to December 31, 2023		HKD 60,000 per month
Ground floor and basement of 62 South Molton Street, London, UK		950 square feet (men’s store) 650 square feet (basement)		February 23, 2023 to February 22, 2033		Rent free from February 23, 2023 to August 22, 2024 and £60,000 during August 23, 2023 to February 22, 2024   £130,000 per year during February 23, 2024 to February 22, 2025   £140,000 per year during February 23, 2025 to February 22, 2026   £150,000 per year during February 23, 2026 to February 22, 2027   £170,000 per year during February 23, 2027 to February 22, 2033

 

36

 

 

Property location		Approximate floor area		Lease term		Rent
Ground floor and basement of 52 South Molton Street, London, UK		669 square feet (women’s store) 703 square feet (office & storage)		April 23, 2023 to April 23, 2033		Rent free from April 24, 2023 to October 23, 2023 and £40,000 during October 24, 2023 to April 23, 2024.   £85,000 per year during April 24, 2024 to April 23, 2025   £90,000 per year during April 24, 2025 to April 23, 2026   £95,000 per year during April 24, 2026 to April 23, 2027   £100,000 per year during April 24, 2027 to April 23, 2033
27 St John’s Wood, London, UK		700 square feet (mixed men’s and women’s store)		August 8, 2023 to February 7, 2024		£6,000 per month

 

We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available on commercially reasonable terms to accommodate any expansion of our operations.

 

ITEM 4A. UNRESOLVED STAFF COMMENTS

 

None.

 

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

 

The following discussion should be read in conjunction with the audited consolidated financial statements and related notes which appear elsewhere in this Annual Report. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those discussed elsewhere in this Annual Report, including those set forth under “Item 3. Key Information — D. Risk Factors.”

 

Exchange rate information

 

NCI is a holding company with operations conducted in Hong Kong through its key operating subsidiary in Hong Kong, Neo-Concept HK, using Hong Kong dollars. Neo-Concept HK’s reporting currency is Hong Kong dollars. Translations of amounts from HKD into US$ are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.8015, US$1 = HKD 7.8363 and US$1 = HKD 7.8109 on December 30, 2022, June 30, 2023 and December 29, 2023, respectively, as published in H.10 statistical release of the Board of Governors of the Federal Reserve System. We make no representation that the HKD or U.S. dollar amounts referred to in this report could have been or could be converted into U.S. dollars or HKD, as the case may be, at any particular rate.

 

A. Results of operations

 

		For the Years Ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
REVENUES, NET			240,536,527				347,451,568				174,202,627				22,302,504
COST OF REVENUES
-Related parties			(29,522,341	)			(103,159,420	)			(34,213,521	)			(4,380,228	)
-External			(188,421,081	)			(202,457,187	)			(104,940,795	)			(13,435,173	)
			(217,943,422	)			(305,616,607	)			(139,154,316	)			(17,815,401	)
Gross profit			22,593,105				41,834,961				35,048,311				4,487,103
EXPENSES
Selling and marketing			(3,133,094	)			(2,631,231	)			(3,132,277	)			(401,014	)
General and administrative			(14,986,860	)			(20,268,417	)			(22,869,509	)			(2,927,897	)
Total expenses			(18,119,954	)			(22,899,648	)			(26,001,786	)			(3,328,911	)
INCOME FROM OPERATION			4,473,151				18,935,313				9,046,525				1,158,192
OTHER INCOME (EXPENSES)
Interest income			1				1				92,951				11,900
Interest expense			(2,492,179	)			(6,133,455	)			(5,759,182	)			(737,326	)
Other income			5,217,777				2,586,019				2,662,360				340,852
Other expense			(5,953	)			(7,444	)			(302,784	)			(38,764	)
Total other income (expenses), net			2,719,646				(3,554,879				(3,306,655	)			(423,338	)
INCOME BEFORE TAX EXPENSES			7,192,797				15,380,434				5,739,870				734,854
INCOME TAX EXPENSES			(1,742,282	)			(2,979,918	)			(1,325,137	)			(169,652	)
NET INCOME			5,450,515				12,400,516				4,414,733				565,202

 

37

 

 

Year ended December 31, 2023 compared with year ended December 31, 2022

 

Revenue

 

For the years ended December 31, 2022 and 2021, we generated our revenue through two revenue streams: sales of private(labelled apparel products and retail sales of own(branded apparel products.

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Sales of private-labelled apparel products			336,306,554				156,316,352				20,012,592
Retail sales of own-branded apparel products			11,145,014				17,886,275				2,289,912
Total			347,451,568				174,202,627				22,302,504

 

Our revenue decreased by 49.9% to HKD174,202,627 (US$22,302,504) for the year ended December 31, 2023, from HKD347,451,568 for the year ended December 31, 2022. The decrease was mainly caused by the decrease in sales of private(labelled apparel products by 53.5% to HKD156,316,352 (US$20,012,592) for the year ended December 31, 2023, from HK336,306,554 for the year ended December 31, 2022, which was mainly due to decrease of orders from our largest customer.

 

Cost of revenue

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Private-labelled apparel products			301,429,220				134,239,759				17,186,208
Own-branded apparel products			4,187,387				4,914,557				629,193
Total			305,616,607				139,154,316				17,815,401

 

Our cost of revenue decreased by 54.5% to HKD139,085,780 (US$17,806,627) for the year ended December 31, 2023, from HKD305,616,607 for the year ended December 31, 2022. The decrease was in correspondence to our decrease of sales in revenue.

 

Gross profit and gross profit margin

 

		For the year ended December 31,
		2022																2023
Product category		Revenue				Cost of revenue				Gross profit				Gross profit margin				Revenue				Cost of revenue				Gross profit				Gross profit margin
		HKD				HKD				HKD				%				HKD				HKD				HKD				%
Private-labelled apparel products			336,306,554				301,429,220				34,877,334				10.4	%			156,316,352				134,239,759				22,076,593				14.1	%
Own-branded apparel products			11,145,014				4,187,387				6,957,627				62.4	%			17,886,275				4,914,557				12,971,718				72.5	%
Total			347,451,568				305,616,607				41,834,961				12.0	%			174,202,627				139,154,316				35,048,311				20.1	%

 

Our overall gross profit decreased by 16.2% to HKD35,048,311 (US$4,487,103) for the year ended December 31, 2023, from HKD41,834,961 for the year ended December 31, 2022, primarily due to the decrease in our revenue. Our overall gross profit margin however increased by 8.1 percentage points to 20.2% for the year ended December 31, 2023, from 12.0% for the year ended December 31, 2022, mainly due to our increase in sales of products with higher margin.

 

Our gross profit for private-labelled apparel products decreased by 36.5% to HKD22,145,129 (US$2,835,157) for the year ended December 31, 2023, from HKD34,877,334 for the year ended December 31, 2022. The decrease was principally in correspondence to the decrease of revenue upon the decrease of orders from our largest customer. Our gross profit margin for private-labelled apparel products however increased by 3.8 percentage points to 14.2% for the year ended December 31, 2023, from 10.4% for the year ended December 31, 2022 as we increased our sales in products with higher margin in 2023.

 

Our gross profit for own-branded apparel products increased by 85.5% to HKD12,903,182 (US$1,651,946) for the year ended December 31, 2023, from HKD6,957,627 for the year ended December 31, 2022. The increase was mainly due to business expansion including open-up of new retail shops in the UK. Our gross profit margin for own-branded apparel products increased by 9.7 percentage points to 72.1% for the year ended December 31, 2023, from 62.4% for the year ended December 31, 2022. The increase was mainly due to the increase in sales of products with higher margin.

 

38

 

 

Selling and marketing expenses

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Transportation costs			1,057,957				333,257				113,406
Marketing and displaying expenses			1,573,274				2,799,020				287,608
Total selling and marketing expenses			2,631,231				3,132,277				401,014

 

Our selling and marketing expenses increased by 19.0% to HKD3,132,277 (US$401,014) for the year ended December 31, 2023, from HKD2,631,231 for the year ended December 31, 2022, primarily due to increase in marketing and displaying expenses due to business expansion including open up of new retail shops in the UK, which were partially offset by the decrease in transportation costs as a result of decrease in sales.

 

General and administrative expenses

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Staff costs			12,436,317				13,260,898				1,697,743
Rental and office expenses			3,205,017				3,260,273				417,401
Insurance			59,595				66,393				8,500
Amortization of intangible assets			137,358				112,049				14,345
Depreciation			11,114				33,091				4,237
Expected credit loss			—				1,383,316				177,101
Legal and professional fee			3,654,819				2,204,622				282,249
Others			764,197				2,548,867				326,321
			20,268,417				22,869,509				2,927,897

 

Our general and administrative expenses increased by 11.4% to HKD22,869,509 (US$2,927,897) for the year ended December 31, 2023, from HKD20,268,417 for the year ended December 31, 2022, the increase was principally due to the increase in rental and office expenses due to business expansion including open-up of new retail shops in the UK, expected credit loss and impairment losses on receivables, which were partially offset by the decrease in legal and professional fee as the engagements for professionals to assist us in the preparation for our IPO project reduced.

 

Interest expense

 

Our interest expense represented factoring charges and interest expense for our bank borrowings, which stayed relatively stable at HKD6,133,455 and HKD5,759,182 (US$737,326) for the year ended December 31, 2022, and 2023, respectively.

 

Other income

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Agency income			2,586,019				2,662,034				340,810
Other			—				326				42
			2,586,019				2,662,360				340,852

 

Our agency income representing service fee charged to a related party, NCH, for promoting NCH’s products in UK stayed relatively stable at HKD2,586,019 and 2,662,034 (US$340,810) for the year ended December 31, 2022, and 2023, respectively.

 

Other expenses

 

		For the years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Exchange loss, net			(7,444	)			(168,356	)			(21,554	)
Penalty			—				(134,428	)			(17,210	)
			(7,444	)			(302,784	)			(38,764	)

 

Our other expenses increased by 3,967.5% to HKD302,784 (US$38,764) for the year ended December 31, 2023, from HKD7,444 for the year ended December 31, 2022, the increase was principally due to the increase in exchange loss, net due to currency fluctuation and increase in penalty arising in the normal course of business.

 

39

 

 

Provision for income tax expense

 

		For the Years ended December 31,
		2022				2023				2023
		HKD				HKD				US$
Current:
Hong Kong			2,979,918				928,973				118,941
UK			—				388,228				49,703
			2,979,918				1,317,201				168,644
Deferred:
UK			—				7,867				1,008
Total provision for income taxes			2,979,918				1,325,137				169,652

 

Provision for income tax expense represents current profit tax. Current profit tax represented tax recorded in Hong Kong.

 

Hong Kong current profit tax arose from the operation of Neo-Concept HK in Hong Kong and its applicable tax rate is 16.5%. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD2,000,000, and 16.5% on any part of assessable profits over HKD2,000,000.

 

Our income tax expense decreased by 55.5% to HKD1,35,137 (US$169,652) for the year ended December 31, 2023 from HKD2,979,918 for the year ended December 31, 2022, mainly due to the decrease in assessable profit.

 

Our effective tax rate increased by 3.7 percentage points to 23.1% for the year ended December 31, 2023 from 19.4% for the year ended December 31, 2022. The increase in effective tax rate was mainly due to Neo-Concept UK changed from loss-making to profitable.

 

Net income

 

Our net income decreased by 64.4% to HKD4,414,733 (US$565,202) for the year ended December 31, 2023, from HKD12,400,516 for the year ended December 31, 2022. The decrease in net income was predominantly due to the decrease in our revenue in 2022.

 

Year ended December 31, 2022 compared with year ended December 31, 2021

 

Revenue

 

For the years ended December 31, 2022 and 2021, we generated our revenue through two revenue streams: sales of private-labelled apparel products and retail sales of own-branded apparel products.

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Sales of private-labelled apparel products			237,282,262				336,306,554				43,107,935
Retail sales of own-branded apparel products			3,254,265				11,145,014				1,428,573
Total			240,536,527				347,451,568				44,536,508

 

Our revenue increased by 44.4% to HKD347,451,568 (US$44,536,508) for the year ended December 31, 2022, from HKD240,536,527 for the year ended December 31, 2021. The increase was mainly contributed by the increase in sales of private-labelled apparel products by 41.7% to HKD336,306,554 (US$43,107,935) for the year ended December 31, 2022, from HK237,282,262 for the year ended December 31, 2021, which was mainly due to the post-COVID-19 recovery of economy and restoration of business of our customers in 2022.

 

Cost of revenue

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Private(labelled apparel products			216,523,165				301,429,220				38,637,342
Own(branded apparel products			1,420,257				4,187,387				536,741
Total			217,943,422				305,616,607				39,174,083

 

Our cost of revenue increased by 40.2% to HKD305,616,607 (US$39,174,083) for the year ended December 31, 2022, from HKD217,943,422 for the year ended December 31, 2021. The increase was in correspondence to our increase of sales in revenue.

 

40

 

 

Gross profit and gross profit margin

 

		For the year ended December 31,
		2021																2022
Product category		Revenue				Cost of revenue				Gross profit				Gross profit margin				Revenue				Cost of revenue				Gross profit				Gross profit margin
		HKD				HKD				HKD				%				HKD				HKD				HKD				%
Private(labelled apparel products			237,282,262				216,523,165				20,759,097				8.7	%			336,306,554				301,429,220				34,877,334				10.4	%
Own(branded apparel products			3,254,265				1,420,257				1,834,008				56.4	%			11,145,014				4,187,387				6,957,627				62.4	%
Total			240,536,527				217,943,422				22,593,105				9.4	%			347,451,568				305,616,607				41,834,961				12.0	%

 

Our overall gross profit increased by 85.2% to HKD41,834,961 (US$5,362,425) for the year ended December 31, 2022, from HKD22,593,105 for the year ended December 31, 2021, primarily due to the increase in our revenue. Our overall gross profit margin increased by 2.6 percentage points to 12.0% for the year ended December 31, 2022, from 9.4% for the year ended December 31, 2021, mainly due to our increase in sales of products with higher margin and the advantage from bulk purchase.

 

Our gross profit for private-labelled apparel products increased by 68.0% to HKD34,877,334 (US$4,470,593) for the year ended December 31, 2022, from HKD20,759,097 for the year ended December 31, 2021. The increase was principally in correspondence to the increase of revenue upon the post COVID-19 economic recovery. Our gross profit margin for private-labelled apparel products increased by 1.7 percentage points to 10.4% for the year ended December 31, 2022, from 8.7% for the year ended December 31, 2021 as we increased our sales in products with higher margin in 2022 and continue to increase our purchases from a major supplier to take advantage of bulk purchase.

 

Our gross profit for own-branded apparel products increased by 279.4% to HKD6,957,627 (US$891,832) for the year ended December 31, 2022, from HKD1,834,008 for the year ended December 31, 2021. The increase was mainly due to the recovery of economy and the increase in retail sales in the UK. Our gross profit margin for own-branded apparel products increased by 6.0 percentage points to 62.4% for the year ended December 31, 2022, from 56.4% for the year ended December 31, 2021. The increase was mainly due to the increase in sales of products with higher margin and the increase in sales of premium products with better pricing.

 

Selling and marketing expenses

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Transportation costs			1,960,336				1,057,957				135,609
Marketing and displaying expenses			1,172,758				1,573,274				201,663
Total selling and marketing expenses			3,133,094				2,631,231				337,272

 

Our selling and marketing expenses decreased by 16.0% to HKD2,631,231 (US$337,272) for the year ended December 31, 2022, from HKD3,133,094 for the year ended December 31, 2021, primarily due to decrease in transportation costs as the ocean freight rates decreased in 2022 after the surge in 2021, which were partially offset by the increase in marketing and displaying expenses due to the increase in marketing activities in 2022 to increase our brand awareness and the opening of an additional retail shop in London in 2022.

 

General and administrative expenses

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Staff costs			6,324,017				12,436,317				1,592,175
Rental and office expenses			2,486,443				3,205,017				410,326
Insurance			743,218				59,595				7,630
Amortization of intangible assets			151,634				137,358				17,585
Depreciation			136,236				11,114				1,423
Legal and professional fee			623,530				3,654,819				467,913
Management fee			4,223,236				—
Others			298,546				764,197				97,837
			14,986,860				20,268,417				2,594,889

 

41

 

 

Our general and administrative expenses increased by 35.2% to HKD20,268,417 (US$2,598,015) for the year ended December 31, 2022, from HKD14,986,860 for the year ended December 31, 2021, the increase was principally due to the increase in staff costs due to increase in headcount to cope with the business recovery and expected business expansion, rental and office expenses due to (i) the increase in contingent rent following the increase in revenue from retail shops in London; and (ii) the increase in office expenses to cope with our business activities and expansion upon post-COVID recovery of economy and restoration of business, and legal and professional fee as we engaged professionals to assist us in the preparation for our IPO project.

 

Interest expense

 

Our interest expense represented factoring charges and interest expense for our bank borrowings, which increased by 146.1% to HKD6,133,455 (US$786,189) for the year ended December 31, 2022, from HKD2,492,179 for the year ended December 31, 2021. The increase was principally attributable to the increase in financing activities and the increase in interest rate during the year ended December 31, 2022.

 

Other income

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Government subsidies			2,313,438				—				—
Agency income			2,904,339				2,586,019				331,477
			5,217,777				2,586,019				331,477

 

Our other income decreased by 50.4% to HKD2,586,019 (US$331,477) for the year ended December 31, 2022, from HKD5,217,777 for the year ended December 31, 2021, principally due to decrease in government subsidies because no government subsidies were received during the year ended December 31, 2022. There were no unfulfilled conditions or other contingencies relating to the government subsidies.

 

Our agency income represented service fee charged to a related party, NCH, for promoting NCH’s products in UK. Agency income remained relatively stable at HKD2,904,339 and HKD2,586,019 (US$331,477) for the year ended December 31, 2021, and 2022, respectively.

 

Other expenses

 

		For the years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Exchange loss, net			(5,953	)			(7,444	)			(954	)
			(5,953	)			(7,444	)			(954	)

 

Our other expenses remained relatively stable at HKD5,953 and HKD7,444 (US$954) for the year ended December 31, 2021, and 2022, respectively.

 

Provision for income tax expense

 

The following table sets forth a breakdown of provision for income tax expense for the years ended December 31, 2022 and 2021:

 

		For the Years ended December 31,
		2021				2022				2022
		HKD				HKD				US$
Current:
Hong Kong			1,742,282				2,979,918				381,967
			1,742,282				2,979,918				381,967
Total provision for income taxes			1,742,282				2,979,918				381,967

 

Provision for income tax expense represents current profit tax. Current profit tax represented tax recorded in Hong Kong.

 

Hong Kong current profit tax arose from the operation of Neo(Concept HK in Hong Kong and its applicable tax rate is 16.5%. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD2,000,000, and 16.5% on any part of assessable profits over HKD2,000,000.

 

Our income tax expense increased by 71.0% to HKD2,979,918 (US$381,967) for the year ended December 31, 2022 from HKD1,742,282 for the year ended December 31, 2021, mainly due to the increase in assessable profit.

 

Our effective tax rate decreased by 4.8 percentage points to 19.4% for the year ended December 31, 2022 from 24.2% for the year ended December 31, 2021. The decrease in effective tax rate was mainly due to temporary difference arising from Neo-Concept NY not recognized in 2021.

 

Net income

 

Our net income increased by 173.6% to HKD14,914,678 (US$1,911,771) for the year ended December 31, 2022, from HKD5,450,515 for the year ended December 31, 2021. The increase in net income was predominantly due to the increase in our revenue in 2022.

 

42

 

 

B. Liquidity and capital resources

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
CURRENT ASSETS
Cash and cash equivalents			8,593,063				5,849,306				748,865
Accounts receivable, net			10,339,186				32,343,592				4,140,828
Other current assets, net			4,380,864				20,225,722				2,589,425
Due from related parties			16,272,733				—				—
Inventories, net			1,299,895				5,320,199				681,125
Total current assets			40,885,741				63,738,819				8,160,243
CURRENT LIABILITIES
Bank borrowings			83,962,426				30,753,400				3,937,242
Accounts payable			10,429,941				—				—
Accruals and other payables			2,242,615				3,205,705				410,413
Due to related parties			—				34,243,244				4,384,033
Operating lease liabilities			653,344				708,829				90,750
Tax payable			4,885,548				916,436				117,329
Total current liabilities			102,173,874				69,827,614				8,939,767
Net current liabilities			(61,288,133	)			(6,088,795	)			(779,524	)

 

Accounts receivable, net

 

Accounts receivable represented receivables from our customers arising from our sales. We generally grant our customers a credit period ranging from 30 to 60 days, depending on their reputation, transaction history and the products purchased. Our accounts receivable increased by 212.8% to HKD32,343,592 (US$4,140,828) as of December 31, 2023, from HKD10,339,186 as of December 31, 2022, because we utilized less factoring of accounts receivable to save from high arrangement fee.

 

Other current assets, net

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Deferred IPO costs			4,229,639				8,148,021				1,043,160
Prepayments			129,229				12,021,838				1,539,110
Others			21,996				55,863				7,155
Total			4,380,864				20,225,722				2,589,425

 

Our other current assets, net increased by 361.7% to HKD20,225,722 (US$2,589,425) as of December 31, 2023, from HKD4,380,864 as of December 31, 2022. The increase was primarily attributable to the increase in prepayments to suppliers to secure our supplies for production and business.

 

Inventories

 

Our inventories represented owen-branded apparel products at our retail shops in London. Our inventories increased by 309.3% to HKD5,320,199 (US$681,125) as of December 31, 2022. We increased our inventory level as of December 31, 2023 to cope with the increase in retail sales as we opened an additional retail shop in London in 2023.

 

We review our inventory levels on a regular basis. We believe that maintaining appropriate levels of inventories can help us better plan raw material procurement and deliver our products to meet customer demand in a timely manner without straining our liquidity.

 

During the years ended December 31, 2021 and 2022, our obsolete and slow-moving inventories amounted to nil and nil, respectively.

 

Accounts payable

 

Our accounts payable mainly related to the purchase of apparel products from our suppliers. Our suppliers usually granted us a credit period between 30 and 60 days.

 

Our accounts payable decreased by 100.0% to nil as of December 31, 2023, from HKD10,429,941 as of December 31, 2022, which was because we increase our prepayment to secure our production and to take advantage of early payment.

 

43

 

 

Accruals and other payables

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Payroll payable			734,454				2,185,617				279,816
Interest payable			412,442				46,397				5,940
Value added tax			905,214				834,902				106,889
Others			190,505				138,789				17,768
Total			2,242,615				3,205,705				410,413

 

Our accruals and other payables increased by 42.9% to HKD3,205,704 (US$410,414) as of December 31, 2023, from HKD2,242,615 as of December 31, 2021, principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.

 

Operating lease liabilities

 

Our operating lease liabilities mainly related to our office in Hong Kong and retail shops in the UK.

 

Cash Flows

 

Our use of cash primarily related to operating activities and payment of dividends. We have historically financed our operations primarily through our cash flow generated from our operations and advances from related parties.

 

The following table sets forth a summary of our cash flows information for the years indicated:

 

		For the Years Ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Cash and cash equivalents at the beginning of the year			421,495				1,428,243				8,593,063				1,100,137
Net cash used in operating activities			10,270,422				(42,759,538	)			(49,225,351	)			(6,302,136	)
Net cash used in investing activities			(78,190	)			(73,526	)			(1,275,847	)			(163,342	)
Net cash from financing activities			(9,185,484	)			49,997,884				47,546,606				6,087,213
			1,428,243				8,593,063				5,638,471				721,872

 

Cash generated from (used in) operating activities

 

Our cash inflow from operating activities was principally from receipt of sales. Our cash outflow used in operating activities was principally for payment of purchases of raw materials, staff costs and other operating expenses.

 

For the year ended December 31, 2021, we had net cash generated from operating activities of HKD10,270,422 (US$1,316,788) mainly arising from net income from our operation of HK$5,450,515, as adjusted for non-cash items and changes in operating assets and liabilities. Adjustments for non-cash items consisted of (i) depreciation of property and equipment of HKD136,236 (US$17,467); and (ii) amortization of intangible assets of HKD151,634 (US$19,441). Changes in operating assets and liabilities mainly include (i) the increase in accounts payable of HKD32,554,096 (US$4,173,816) which was in line with the increase in our cost of revenue; and (ii) the increase in tax payable of HKD1,742,282 (US$223,381) due to more assessable profit generated by Neo-Concept HK as a result of the increase in revenue during the year, and partially offset by (i) increase in accounts receivables of HKD29,744,236 (US$3,813,559); and (ii) the increase in other current assets, net of HKD589,596 (US$75,593) which was primarily attributable to the deferred IPO costs as we engaged professionals to assist us in preparation for our IPO project.

 

For the year ended December 31, 2022, we had net cash used in operating activities of HKD42,759,538 (US$5,480,936) mainly arising from net income from our operation of HK$12,400,516 (US$1,589,505), as adjusted for non-cash items and changes in operating assets and liabilities. Adjustments for non-cash items consisted of (i) depreciation of property and equipment of HKD11,114 (US$1,425); and (ii) amortization of intangible assets of HKD137,358 (US$17,607). Changes in operating assets and liabilities mainly include (i) the increase in other current assets, net of HKD3,796,835 (US$486,680) due to the increase in our deferred IPO costs; (ii) the increase in inventories of HKD619,878 (US$79,456) to cope with the increase in retail sales as we opened an additional retail shop in London in 2022; and (iii) the decrease in accounts payable of HKD74,184,359 (US$9,508,987) as we sped up our settlement of accounts payable to take advantage of bulk purchase; and partially offset by (i) decrease in accounts receivable of HKD19,369,617 (US$2,482,807) because we sped up the collection of accounts receivable by way of factoring so as to strengthen our liquidity for the year ended December 31, 2022; (ii) increase in accruals and other payables of HKD921,015 (US$118,056) mainly due to the increase in value added tax payable; and (ii) the increase in tax payable of HKD3,001,914 (US$384,787).

 

44

 

 

For the year ended December 31, 2023, we had net cash used in operating activities of HKD 49,225,351 (US$6,302,136) mainly arising from net income from our operation of HK$4,414,733 (US$ 565,202), as adjusted for non-cash items and changes in operating assets and liabilities. Adjustments for non-cash items consisted of (i) depreciation of property and equipment of HKD33,091 (US$4,237); (ii) amortization of intangible assets of HKD112,049 (US$14,345); inventory provision of HKD68,536 (US$8,774); and allowance for expected credit loss of HKD1,383,316 (US$177,101). Changes in operating assets and liabilities mainly include (i) increase in trade receivable of HKD23,387,722 (US$2,994,242) because we utilized less factoring of accounts receivable; (ii) increase of other current assets, net of HKD14,332,426 (US$1,834,926) due to increase in prepayments to suppliers to secure our supplies for production and business; (iii) the increase in inventories of HKD4,088,840 (US$523,479) to cope with the increase in retail sales as we opened an additional retail shop in London in 2023; and (iv) the decrease in accounts payable of HKD10,429,941 (US$1,335,306) as we increased our prepayment to secure our production; and (v) decrease if tax payable of HKD3,969,112 (US$508,150) as our assessable profit reduced in 2023, and partially offset by (i) increase in accruals and other payables of HKD963,089 (US$ 123,301) principally due to the increase of payroll payable as a result of headcount increase and value added tax payable principally resulting from business expansion in the UK.

 

Cash used in investing activities

 

For the year ended December 31, 2021, net cash used in investing activities was HKD78,190 (US$10,025) which related to the acquisition of computer and office equipment.

 

For the year ended December 31, 2022, net cash used in investing activities was HKD73,526 (US$9,425) which related to the acquisition of computer and office equipment.

 

For the year ended December 31, 2023, net cash used in investing activities was HKD1,275,847 (US$163,342) which related to the acquisition of computer and office equipment and leasehold improvement.

 

Net cash (used in)/from financing activities

 

For the year ended December 31, 2021, net cash used in financing activities of HKD9,185,484 (US$1,177,686) consisted of (i) repayment for bank borrowings of HKD220,367,256 (US$28,253,661); and (ii) advance to related parties of HKD31,642,544 (US$4,056,944), the effects of which were partially offset by proceeds from bank borrowings of HKD243,090,875 (US$31,167,095).

 

For the year ended December 31, 2022, net cash from financing activities of HKD49,997,884 (US$6,408,752) consisted of (i) proceeds from bank borrowings of HKD508,716,999 (US$65,207,588), the effects of which were partially offset by (i) repayment for bank borrowings of HKD452,377,168 (US$57,985,922); and (ii) advance to related parties of HKD6,341,947 (US$812,914).

 

For the year ended December 31, 2023, net cash from financing activities of HKD47,546,606 (US$6,087,213) consisted of (i) proceeds from bank borrowings of HKD115,018,274 (US$14,725,356); and (ii) advance from related parties of HKD101,130,691 (US$12,947,380), the effects of which were partially offset by (i) repayment for bank borrowings of HKD168,602,359 (US$21,585,523).

 

Cash Flow Sufficiency

 

In order to meet the debt obligations and operating needs of our business, our management expects to satisfy the cash flow needs through (i) maintaining stable relationships with banks in order to renew the bank loans upon maturity or to arrange for additional banking facilities for use when necessary; (ii) closely monitoring the collection status of account receivables and actively following up with our customers for settlements; (iii) continuing to speed up the collection of account receivables by way of factoring to strengthen our cash position; (iv) diversifying and broadening our customer base to avoid reliance on particular customers and to expand our sources of revenue and cash flow; and (v) effectively managing accounts payable and negotiating for longer credit periods from suppliers, when necessary.

 

We believe that, taking into consideration the financial resources presently available, including the current levels of cash and cash flows from operations, and the measures mentioned above, will be sufficient to meet its anticipated cash needs for at least the next twelve months from the date of this report.

 

Capital Expenditures

 

We incurred capital expenditures of HKD1,275,847 (US$163,342) and HKD78,190 for the years ended December 31, 2023 and 2022, respectively, which related to the acquisition of computer and office equipment and leasehold improvement.

 

As of December 31, 2023, we did not have any capital expenditure commitment.

 

Contractual Obligations

 

The following table summarized our undiscounted contractual obligations as of December 31, 2022:

 

Payment due by period

Less than 1 year

2 to 3 years

4 to 5 years

More than 5 years

Total

HK$

HK$

HK$

HK$

HK$

Contractual Obligations:

Operating lease obligation

2,014,564

5,513,198

6,069,718

13,447,761

27,045,241

 

45

 

 

Off-Balance Sheet Arrangements

 

We have no off-balance sheet arrangements, including arrangements that would affect its liquidity, capital resources, market risk support, and credit risk support or other benefits.

 

C. Research and development, patents and licenses

 

To date, we do not own any patents, copyrights, or trademarks. We, through our Operating Subsidiaries, own and maintain the registered domains www.les100ciels.com and www.neo-ig.com, and the following trademark registered in the United Kingdom:

 

No.

Trademark

Place of registration

Trademark number

Owner

Class

Expiry Date

1.

United Kingdom

UK00003803682

NCI

23, 24, 25, 35

June 27, 2032

 

We are licensed to use the trademarks “les 100 ciels” under a royalty free license agreement granted by our affiliated company controlled by our Controlling Shareholders, NCH. The license is an exclusive and irrevocable royalty-free license, valid for an initial term of five years until December 31, 2026, with an option to renew for a further term of five-years.

 

D. Trend information

 

See ITEM 5.A “operating results” above for our trend information.

 

E. Critical Accounting Estimates

 

We prepare our consolidated financial statements in accordance with U.S. GAAP, which requires us to make judgments, estimates and assumptions that affect (i) the reported amounts of our assets and liabilities; (ii) the disclosure of our contingent assets and liabilities at the end of each reporting period; and (iii) the reported amounts of revenues and expenses during each reporting period. We continually evaluate these judgments, estimates and assumptions based on our own historical experience, knowledge and assessment of current business and other conditions and our expectations regarding the future based on available information, which together form our basis for making judgments about matters that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates. Some of our accounting policies require a higher degree of judgment than others in their application.

 

When reading our consolidated financial statements, you should consider our selection of critical accounting policies, the judgment and other uncertainties affecting the application of such policies and the sensitivity of reported results to changes in conditions and assumptions. Our critical accounting policies and practices include the following: (i) revenue recognition; (ii) operating leases; and (iii) long-term investment. See Note 2 — Summary of Significant Accounting Policies to our consolidated financial statements for the disclosure of these accounting policies. We believe the following accounting estimates involve the most significant judgments used in the preparation of our consolidated financial statements.

 

Accounts receivable

 

Accounts receivable mainly represent amounts due from clients for corporate finance services which are recorded net of allowance for the Group’s doubtful accounts. The group does not grant credit terms to the clients. In evaluating the collectability of receivable balances, the Group considers specific evidence including aging of the receivable, the client’s payment history, its current creditworthiness and current economic trends. The Group regularly reviews the adequacy and appropriateness of the allowance for doubtful accounts. Accounts receivable are written off after all collection efforts have ceased. As of December 31, 2023 and 2022, the allowance for doubtful accounts was nil.

 

Property and equipment, net

 

Property and equipment are stated at cost less accumulated depreciation and impairment if applicable. The Group computes depreciation using the straight-line method over the estimated useful lives of the assets as follows:

 

	Office equipment		1 – 3 years
	Furniture and fixtures		3 years
	Motor vehicles		5 years
	Leasehold improvements		Over the shorter of the lease term or estimated useful life

 

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of operations. Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Group also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

 

Lease

 

The Group is a lessee of non-cancellable operating leases for corporate office premise. The Group determines if an arrangement is a lease at inception. Lease assets and liabilities are recognized at the present value of the future lease payments at the leases commencement date. The interest rate used to determine the present value of the future lease payments is the Group’s incremental borrowing rate based on the information available at the lease commencement date. The Group generally uses the base, non-cancellable lease term in calculating the right-of-use assets and liabilities.

46

 

 

The Group may recognize the lease payments in the consolidated statements of operations on a straight-line basis over the lease terms and variable lease payments in the periods in which the obligations for those payments are incurred, if any. The lease payments under the lease arrangements are fixed.

 

The lease standard provides practical expedients for an entity ongoing accounting. The Group elected to apply the short-term lease exception for lease arrangements with a lease term of 12 months or less at commencement. Lease terms used to compute the present value of lease payments do not include any option to extend, renew or terminate the lease that the Group is not able to reasonably certain to exercise upon the lease inception. Accordingly, operating lease right-of-use assets and liabilities do not include leases with a lease term of 12 months or less.

 

The Group did not adopt the practical expedient that allows lessees to treat the lease and non-lease components of a lease as a single lease component. Non-lease components include payments for building management, utilities and property tax. It separates the non-lease components from the lease components to which they relate.

 

The Group evaluates the impairment of its right-of-use assets consistent with the approach applied for its other long-lived assets. The Group reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Group has elected to include the carrying amount of finance and operating lease liabilities in any tested asset group and include the associated lease payments in the undiscounted future pre-tax cash flows. For the years ended December 31, 2023, 2022 and 2021, the Group did not have any impairment loss against its operating lease right-of-use assets.

 

Impairment of long-lived assets

 

The Group evaluates the recoverability of its long-lived assets (asset groups), including property and equipment and operating lease right-of-use assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of its asset (asset group) may not be fully recoverable. When these events occur, the Group measures impairment by comparing the carrying amount of the assets to the estimated undiscounted future cash flows expected to result from the use of the asset (asset group) and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amount of the asset (asset group), the Group recognizes an impairment loss based on the excess of the carrying amount of the asset (asset group) over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the asset (asset group), when the market prices are not readily available. The adjusted carrying amount of the asset is the new cost basis and is depreciated over the asset’s remaining useful life. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For the years ended December 31, 2023, 2022 and 2021, no impairment of long-lived assets was recognized.

 

Recent accounting pronouncements

 

See the discussion of the recent accounting pronouncements contained in Note 2 to the consolidated financial statements, “Summary of Significant Accounting Policies”.

 

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

 

A. Directors and senior management.

 

The following table provides information regarding the executive officers and directors of the Company as of the date of this report:

 

Directors and Executive officers		Age		Position
Ms. Eva Yuk Yin Siu		62		Director, Chairlady of the Board, Chief Executive Officer
Ms. Man Chi Wai		66		Director
Mr. Patrick Kwok Fai Lau		51		Chief Financial Officer
Mr. To Wai Suen		49		Independent Director Nominee*
Mr. Mark Gary Singer		66		Independent Director Nominee*
Ms. Josephine Yan Yeung		42		Independent Director Nominee*

 

 

*	The proposed nominees will become Independent Directors of our Company upon the effectiveness of the registration statement of which this report forms a part.

 

Ms. Eva Yuk Yin Siu has served as our Chairlady of the Board, and a Director since July 2021. Ms. Siu was also appointed our Chief Executive Officer in May 2022. Ms. Siu is primarily responsible for NCI and its subsidiaries’ overall management, formulating operation direction, devising annual plans, strategic planning and business development. In October 1992 she co-founded Neo-Concept HK and has served as its director since October 1992. In August 2000 she also co-founded Neo-Concept UK. Neo-Concept HK and Neo-Concept UK, our operating subsidiaries, were established to intertwine the elements of fashion, where function, creativity, innovation, and craftsmanship are equally important and complementary with one another. Ms. Siu is also a director of NCH, a company incorporated in Hong Kong in October 1990, as well as certain subsidiaries under the NCH group. NCH and its subsidiaries are a comprehensive garment service solutions provider that provides an array of services in the apparel supply chain, including textile and clothing manufacturing through its factories based in the PRC. Ms. Siu has more than 30 years of experience in the fashion garment industry and her fashion sense and insight into fashion trends have laid a strong foundation for our business. Ms. Siu attended the True Light Middle School, Hong Kong.

 

47

 

 

Ms. Man Chi Wai has served as a Director since July 2021. Ms. Wai is primarily responsible for assisting the Chairlady of our Board with the overall management and operations of NCI and its subsidiaries. In October 1992 she co-founded Neo-Concept HK and has served as its director since October 1992. In August 2000 she also co-founded Neo-Concept UK. In 1983, Ms. Wai joined the Bonds Group of Companies as an administration secretary in the international trades division. From 1986 to 1990 she served as the administration manager in commercial projects section for Bonds Group of Companies. Ms. Wai is also a director of NCH since September, 1992, a company incorporated in Hong Kong in October 1990, as well as certain subsidiaries under the NCH group. NCH and its subsidiaries are a comprehensive garment service solutions provider that provides an array of services in the apparel supply chain, including textile and clothing manufacturing through its factories based in the PRC. Ms. Wai has more than 30 years of experience in the fashion garment industry and holds extensive operational and insights that have considerably contributed to our fast growth and unique corporate culture. Ms. Wai obtained a Higher Diploma of Business Studies in the Polytechnic College in 1979.

 

Mr. Patrick Kwok Fai Lau has served as our Chief Financial Officer since May 2022. Mr. Lau has been serving as the chief financial officer of Neo-Concept HK since December 2021. From September 2020 to November 2021, Mr. Lau was the chief financial officer of our affiliated company, NCH. Mr. Lau has more than 20 years of experience in the fields of accounting, auditing, financial advisory and corporate governance. From September 1996 to November 1997, Mr. Lau worked as an auditor at Glass Radcliffe Chan & Wee, an accounting firm. From December 1997 to April 1999, Mr. Lau was an associate at PricewaterhouseCoopers. From October 1999 to June 2011, Mr. Lau worked at served in various positions in KPMG, Hong Kong office, KPMG Huazhen (Guangzhou office) and KPMG Advisory (China) Limited, with his last position as a manager of KPMG Advisory (China) Limited, a consulting services company. From July 2011 to June 2016, Mr. Lau held various positions, including deputy general manager, financial controller, and company secretary, in BII Railway Transportation Technology Holdings Company Limited (HKSE: 1522). From July 2016 to October 2019, Mr. Lau served as the chief financial officer and company secretary of International Alliance Financial Leasing Co., Ltd. (HKSE: 1563).

 

Mr. Lau obtained a degree of Master of Science in Corporate Governance and Directorship (Distinction) from Hong Kong Baptist University in November 2014. He also obtained the HKICPA Diploma in Insolvency awarded by The Hong Kong Institute of Certified Public Accountants in June 2004. Mr. Lau has been a member of The Hong Kong

 

Institute of Certified Public Accountants and a fellow member of the Association of Chartered Certified Accountants since July 2003 and December 2007, respectively. He has also been a member of Beta Gamma Sigma Hong Kong, an international honor society for collegiate schools of business since April 2014.

 

Mr. Lau has been an independent non-executive director of Steering Holdings Limited (now known as FDB Holdings Limited) (HKSE: 1826) since January 2018, Ximei Resources Holding Limited (HKSE: 9936) since February 2020 and Zhongtian Construction (Hunan) Group Limited (HKSE: 2433) since March 2023. Mr. Lau was also an independent non-executive director of Jinhai International Group Holdings Limited (HKSE: 2225) from September 2017 to June 2020 and Sundy Service Group Co. Ltd (HKSE: 9608) from December 2020 to January 2024.

 

Mr. Mark Gary Singer became an independent Director upon the effectiveness of the registration statement of which this report forms a part and will be the Chairman of the Nominating and Corporate Governance Committees and a member of the Audit Committee and Compensation Committee. Mr. Singer has over 30 years of management experience spanning sales, supply chain, operations and logistical support for a wide range of companies from startups to medium cap. From May 1988 to June 1996, Mr. Singer worked at August Silk (formerly Diane Gilman) with his last position as Group Vice President of Sales, Production and Sourcing. From July 1996 to August 1998, Mr. Singer was Vice President of the Production and Product Development department at 17 North (Cable and Gauge label). From March 1998 to April 2002, Mr. Singer was the Director of Sales, Marketing and Product Development at Jones Apparel Group. From May 2002 to May 2013, Mr. Singer was the Chief Executive Officer of Neo-Concept (NY) Corporation. In September 2014, Mr. Singer founded MGS Consulting Services, a consulting services firm based in New York that works with early to mid-cap direct to consumer and wholesaler companies within the fashion industry. Mr. Singer currently serves as the President of MGS Consulting Services. From October 2019 to February 2021, Mr. Singer served as the President and part-time Chief Operations Officer at KBL Group International. Since October 2021, Mr. Singer serves as part-time Chief Operations Officers at Sophie Loo Jacobsen, a company engaged in sale of glass homeware both direct to consumer and to key wholesale accounts in US, Europe, UK and Australia. Since March 2022, Mr. Singer serves as part-time Chief Operations Office at Love, SVW, a start-up that will be based in New York and engage in sale of accessories. Mr. Singer has extensive experience in providing long term growth strategies. Mr. Singer obtained a Bachelor of Arts’ degree in History and Economics from Colgate University, Hamilton, New York in June 1979.

 

Mr. To Wai Suen became an independent Director upon the effectiveness of the registration statement of which this report forms a part and will serve as the Chairman of the Audit Committee, a member of the Compensation Committee and Nominating and Corporate Governance Committees of the Company. Mr. Suen has over 18 years of experience in finance and accounting. He is currently an independent director of MingZhu Logistics Holdings Limited, a company listed on NASDAQ (stock code: YGMZ) since September 2020. Also, he is an independent non-executive director of Huajin International Holdings Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 2738), since March 2023 and Huisen Household International Group Limited, a company whose shares are listed on the Main Board of the Stock Exchange (stock code: 2127), since December 2020. In addition, he served an independent non-executive director of CT Environmental Group Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 1363), from February 2018 to April 2019. From April 2018 to January 2022, Mr. Suen was also an independent director of China Zenix Auto International Limited (a company whose American depositary shares were previously listed on the New York Stock Exchange under the stock code “ZX” but was subsequently delisted in December 2018, and then was quoted on the over-the-counter markets under the stock code “ZXAIY” but was subsequently delisted in January 2022). Since February 2020, he has also served as an independent non-executive director of Ping An Securities Group (Holdings) Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 231) which was subsequently delisted in November 2022 and from January 2024 to March 2024, he was an independent director of J-Long Group Ltd, a company listed on NASDAQ (stock code: JL). Other than serving as an independent director, he served as the chief financial officer and company secretary of China Saite Group Company Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 153), from May 2015 to August 2016. In addition, he served as the company secretary to certain companies including IDT International Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 167), from January 2017 to April 2017, China Smarter Energy Group Holdings Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 1004), from February 2017 to April 2019, and Asia Energy Logistics Group Limited, a company listed on the Stock Exchange of Hong Kong (stock code: 351), from July 2020 to April 2021, respectively. He also worked at an international audit firm from January 2001 to July 2013. Mr. Suen is a practising member of the Hong Kong Institute of Certified Public Accountants. He obtained a bachelor’s degree in commerce from The University of Western Australia in March 2001. We believe Mr. Suen is well qualified to serve on our board of directors based on his extensive work experience in accounting and finance.

 

48

 

 

Ms. Josephine Yan Yeung became our independent Director upon the effectiveness of the registration statement of which this report forms a part, and will serve as the Chairlady of Compensation Committee, a member of the Audit Committee and Nominating and Corporate Governance Committees of the Company. Ms. Yeung has approximately 19 years of experience in auditing, financial management, internal control, and corporate governance. From September 2003 to July 2009, Ms. Yeung held various positions in Ernst & Young Hong Kong, where she last served as manager in the assurance and advisory business services department, specializing in auditing listed companies in Hong Kong. From August 2009 to May 2017, Ms. Yeung worked at Verdant Group Ltd, a China focused private investment firm based in Hong Kong with her last position as a group finance director. She is a practicing member of The Hong Kong Institute of Certified Public Accountants and has been practicing in Noble Partners CPA Company, a Hong Kong-based audit firm since May 2017.

 

Ms. Yeung graduated from The Hong Kong University of Science and Technology in November 2003 with a Bachelor of Business Administration in Accounting degree. She was admitted as a member and fellow of the Association of Chartered Certified Accountants in the UK in February 2007 and February 2012, respectively. She was admitted as a member and fellow of The Hong Kong Institute of Certified Public Accountants in February 2008 and October 2017, respectively. She is currently a practicing certified public accountant in Hong Kong. Ms. Yeung served as a joint company secretary member of Sunlight (1977) Holdings Limited (HKSE: 8451) from April 2018 to May 2019. She also served as a company secretary of Tu Yi Holding Company Limited (HKSE: 1701) from June 2019 to June 2020.

 

Key Employees

 

Ms. Harriet Lewis is the managing director of Neo-Concept UK. Ms. Lewis joined our affiliated company, Neo-Concept (NY) Corporation and has served as its director and president since June 1999. Ms. Lewis has served as the director of Neo-Concept UK since August 2000.

 

From May 1973 to August 1974, Ms. Lewis worked as a creative designer at Allied Advertising Agency. From September 1975 to August 1979, Ms. Lewis worked at the Department of Printing at the Kwun Tong Technical institute, with her last position as an assistant lecturer. From September 1979 to December 1981, Ms. Lewis was a design coordinator and photographer at Myer Jewelry Mfr. Ltd. From January 1981 to May 1983, Ms. Lewis formed a partnership, Studio 3S, engaged in advertising and photography. From June 1983 to June 2000, Ms. Lewis co-founded Brabo (Caribbean) Limited, as a manufacturer of plastic and fabric souvenirs.

 

In November 1973, Ms. Lewis obtained a Higher Diploma in Industrial Design from the Hong Kong Polytechnic (currently, The Hong Kong Polytechnic University). In July 1975, she also obtained a technical teachers certificate from Education Department of The Hong Kong Technical Teachers’ College. In January 1998, Ms. Lewis was awarded a certified diploma in small business administration from the Associate of Certified Book-keepers. Ms. Lewis has been admitted as a member of the Institute of Printing, United Kingdom since December 1981.

 

Ms. Lewis is the sister of Ms. Siu.

 

Family Relationships

 

Save as disclosed above, none of our directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K.

 

B. Compensation.

 

For the year ended December 31, 2023, we paid an aggregate of HKD 3,556,750 in cash (including salaries and mandatory provident fund) to our directors. Our Hong Kong subsidiaries are required by law to make contributions equal to certain percentages of each employee’s salary for his or her mandatory provident fund. We have not made any agreements with our directors or executive officers to provide benefits upon termination of employment.

 

Equity Compensation Plan Information

 

We have not adopted any equity compensation plans.

 

Outstanding Equity Awards at Fiscal Year-End

 

As of December 31, 2023, December 31, 2022 and December 31, 2021, we had no outstanding equity awards.

 

49

 

 

C. Board Practices.

 

Our board of directors will consist of five directors, comprising two executive directors and three independent directors, upon the SEC’s declaration of effectiveness of the registration statement of which this report is a part. A director is not required to hold any shares in our Company to qualify to serve as a director. Subject to making appropriate disclosures to the board of directors in accordance with our post-offering Amended and Restated Memorandum and Articles of Association, a director may vote with respect to any contract, proposed contract, or arrangement in which he or she is interested, in voting in respect of any such matter, such director should take into account his or her director’s duties. A director may exercise all the powers of the company to borrow money, mortgage its business, property and uncalled capital, and issue debentures or other securities whenever money is borrowed or as security for any obligation of the company or of any third party.

 

Board diversity

 

We seek to achieve board diversity through the consideration of a number of factors when selecting the candidates to our Board, including but not limited to gender, skills, age, professional experience, knowledge, cultural, education background, ethnicity and length of service. The ultimate decision of the appointment will be based on merit and the contribution which the selected candidates will bring to our Board.

 

Our directors have a balanced mix of knowledge and skills. We will have three independent directors with different industry backgrounds, representing a majority of the members of our board. We will also achieve gender diversity by having one female independent director out of the total of three independent directors, as well as Ms. Lau. Our board is well balanced and diversified in alignment with the business development and strategy of NCI and our subsidiaries.

 

Committees of the Board of Directors

 

Prior to the declaration of effectiveness of the registration statement of which this report forms a part, we intend to establish an audit committee, a compensation committee, and a nominating and corporate governance committee under the board of directors. We intend to adopt a charter for each of the three committees upon the establishment of the committees. Each committee’s members and functions are described below.

 

Audit Committee

 

Our audit committee will consist of Mr. To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. To Wai Suen. We have determined that each of these three director nominees satisfies the “independence” requirements of the Nasdaq Listing Rules and meet the independence standards under Rule 10A-3 under the Securities Exchange Act of 1934, as amended. We have determined that Mr. To Wai Suen qualifies as an “audit committee financial expert.” The audit committee oversees our accounting and financial reporting processes and the audits of our financial statements. The audit committee is responsible for, among other things:

 

●

selecting the independent registered public accounting firm and pre-approving all auditing and non-auditing services permitted to be performed by the independent registered public accounting firm;

 

●

reviewing with the independent registered public accounting firm any audit problems or difficulties and management’s responses;

 

●

reviewing and approving all proposed related party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;

 

●

discussing the annual audited financial statements with management and the independent registered public accounting firm;

 

●

reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures and any special steps taken to monitor and control major financial risk exposures;

 

●

annually reviewing and reassessing the adequacy of our audit committee charter;

 

●

meeting separately and periodically with management and the independent registered public accounting firm;

 

●

monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and

 

●

reporting regularly to the board.

 

50

 

 

Compensation Committee

 

Our compensation committee will consist of Mr. To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Ms. Josephine Yan Yeung. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules. The compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. Our chief executive officer may not be present at any committee meeting during which their compensation is deliberated upon. The compensation committee is responsible for, among other things:

 

●

reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers;

 

●

reviewing and recommending to the board for determination with respect to the compensation of our non-employee directors;

 

●

reviewing periodically and approving any incentive compensation or equity plans, programs or other similar arrangements, annual bonuses, and employee pension and welfare benefit plans; and

 

●

selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person’s independence from management.

 

Nominating and Corporate Governance Committee

 

Our nominating and corporate governance committee will consist of Mr. To Wai Suen, Mr. Mark Gary Singer and Ms. Josephine Yan Yeung and is chaired by Mr. Mark Gary Singer. We have determined that each of these directors satisfies the “independence” requirements of the Nasdaq Listing Rules. The nominating and corporate governance committee assists the board in selecting individuals qualified to become our directors and in determining the composition of the board and its committees. The nominating and corporate governance committee is responsible for, among other things:

 

●

recommending nominees to the board for election or re-election to the board, or for appointment to fill any vacancy on the board;

 

●

reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience, expertise, diversity and availability of service to us;

 

●

selecting and recommending to the board the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself;

 

●

developing, reviewing the corporate governance principles adopted by the board and advising the board with respect to significant developments in the law and practice of corporate governance and our compliance with such laws and practices;

 

●

monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance; and

 

●

evaluating the performance and effectiveness of the board as a whole.

 

Board Diversity Matrix (As of May 14, 2024)

 

Country of Principal Executive Offices		Hong Kong
Foreign Private Issuer		Yes
Disclosure Prohibited Under Home Country Law		No
Total Number of Directors			5

 

Part I: Gender Identity		Female				Male				Non-Binary				Did Not Disclose Gender
Directors			1				4				0				0
Part II: Demographic Background
Underrepresented Individual in Home Country Jurisdiction			0				0				0				0
LGBTQ+			0				0				0				0

 

51

 

 

Foreign Private Issuer Exemption

 

We are a “foreign private issuer,” as defined by the SEC. As a result, in accordance with the rules and regulations of Nasdaq, we may choose to comply with home country governance requirements and certain exemptions thereunder rather than complying with Nasdaq corporate governance standards. We may choose to take advantage of the following exemptions afforded to foreign private issuers:

 

●

Exemption from filing quarterly reports on Form 10-Q, from filing proxy solicitation materials on Schedule 14A or 14C in connection with annual or special meetings of shareholders, or from providing current reports on Form 8-K disclosing significant events within four (4) days of their occurrence, and from the disclosure requirements of Regulation FD.

 

●

Exemption from Section 16 rules regarding sales of Ordinary Shares by insiders, which will provide less data in this regard than shareholders of U.S. companies that are subject to the Exchange Act.

 

●

Exemption from the Nasdaq rules applicable to domestic issuers requiring disclosure within four (4) business days of any determination to grant a waiver of the code of business conduct and ethics to directors and officers. Although we will require board approval of any such waiver, we may choose not to disclose the waiver in the manner set forth in the Nasdaq rules, as permitted by the foreign private issuer exemption.

 

Furthermore, Nasdaq Rule 5615(a)(3) provides that a foreign private issuer, such as us, may rely on our home country corporate governance practices in lieu of certain of the rules in the Nasdaq Rule 5600 Series and Rule 5250(d), provided that we nevertheless comply with Nasdaq’s Notification of Noncompliance requirement (Rule 5625), the Voting Rights requirement (Rule 5640) and that we have an audit committee that satisfies Rule 5605(c)(3), consisting of committee members that meet the independence requirements of Rule 5605(c)(2)(A)(ii). If we rely on our home country corporate governance practices in lieu of certain of the rules of Nasdaq, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of Nasdaq. If we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer.

 

Equity Compensation Plan Information

 

We have not adopted any equity compensation plans.

 

Outstanding Equity Awards at Fiscal Year-End

 

As of December 31, 2023, December 31, 2022 and December 31, 2021, we had no outstanding equity awards.

 

Clawback Policy

 

On December 1, 2023, our board of directors adopted a clawback policy (the “Clawback Policy”) permitting the Company to seek the recoupment of incentive compensation received by any of the Company’s current and former executive officers (as determined by the board in accordance with Section 10D of the Exchange Act and the Nasdaq rules) and such other senior executives/employees who may from time to time be deemed subject to the Clawback Policy by the board (collectively, the “Covered Executives”). The amount to be recovered will be the excess of the incentive compensation paid to the Covered Executive based on the erroneous data over the incentive compensation that would have been paid to the Covered Executive had it been based on the restated results, as determined by the board. If the board cannot determine the amount of excess incentive compensation received by the Covered Executive directly from the information in the accounting restatement, then it will make its determination based on a reasonable estimate of the effect of the accounting restatement. Refer to Exhibit 97.1 of this Annual Report for the Company’s Clawback Policy.

 

D. Employees.

 

As of December 31, 2023, we employed a total number of 24 full-time employees, 13 of whom are based in Hong Kong and 11 of whom are based in the UK. Our employees are employed in the areas of human resources and administration, management, product design and development, sourcing and logistics, and quality control. The remuneration package offered to our employees generally includes basic salary, bonuses and cash allowances or subsidies. We provide our employees with social security benefits in accordance with all applicable regulations and internal policies.

 

E. Share Ownership.

 

The following table sets forth information regarding the beneficial ownership of our Ordinary Shares as of the date of this report by our officers, directors, and 5% or greater beneficial owners of Ordinary Shares. There is no other person or group of affiliated persons known by us to beneficially own more than 5% of our Ordinary Shares. Holders of our Ordinary Shares are entitled to one (1) vote per share and vote on all matters submitted to a vote of our shareholders, except as may otherwise be required by law.

 

52

 

 

We have determined beneficial ownership in accordance with the rules of the SEC. These rules generally attribute beneficial ownership of securities to persons who possess sole or shared voting power or investment power with respect to those securities. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Unless otherwise indicated, the person identified in this table has sole voting and investment power with respect to all shares shown as beneficially owned by him, subject to applicable community property laws.

 

		Ordinary Shares beneficially held
Directors		Number of Ordinary Shares				Approximate percentage of outstanding Ordinary Shares
Directors and executive officers(1)
Ms. Eva Yuk Yin Siu(3)			14,526,355				71.5	%
Ms. Man Chi Wai(4)			392,515				1.9	%
Mr. Patrick Kwok Fai Lau			—				—
Mr. Mark Gary Singer(2)			—				—
Mr. To Wai Suen(2)			—				—
Ms. Josephine Yeung Yan(2)			—				—
All directors and executive officers as a group (6 individuals)			14,918,870				73.4	%
5% principal shareholders:
Ms. Eva Yuk Yin Siu(3)			14,526,355				71.5	%
Asset Empire International Limited(3)(7)			14,526,355				71.5	%
Splendid Vibe Limited(3)(4)(7)			16,561,800				81.5	%
Neo-concept (BVI) Limited(5)(7)			14,761,800				72.6	%
Ample Excellence Limited(6)(7)			1,800,000				8.9	%
VIAPC 1 Limited(8)			1,642,930				8.1	%

 

 

As of the date of this report, none of our outstanding Ordinary Shares are held by record holders in the United States.

 

(1)

Except as otherwise indicated below, the business address for our directors and executive officers is 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Kowloon, Hong Kong.

(2)	Each of Mr. Mark Singer, Mr. To-Wai Suen and Ms. Josephine Yan Yeung accepted their appointment as our independent non-executive director, from the effective date of our registration statement on Form F-1 for our IPO.

(3)

Ms. Eva Yuk Yin Siu, the chairlady of the Board, Chief Executive Officer, and a Director of the Company, owns the entire issued share capital of Asset Empire International Limited. Asset Empire International Limited, a company incorporated in the BVI with limited liability, holds 87.71% of the issued shares of Splendid Vibe Limited. Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited.

(4)

Ms. Man Chi Wai, a Director of the Company, owns the entire issued share capital of Ultra Sky Group Holdings Limited. Ultra Sky Group Holdings Limited, a company incorporated in the BVI with limited liability, holds 2.37% of the issued shares of Splendid Vibe Limited. Splendid Vibe Limited, a company incorporated in the BVI with limited liability, owns the entire issued share capital of Ample Excellence Limited and Neo-Concept (BVI) Limited.

(5)	Neo-Concept (BVI) Limited, a company incorporated in the BVI with limited liability, owns 72.6% of the issued Shares of the Company.

(6)	Ample Excellence Limited, a company incorporated in the BVI with limited liability, owns 8.9% of the issued Shares of the Company.

(7)

The registered office address of each of these entities listed is Coastal Building, Wickham’s Cay II, P. O. Box 2221, Road Town, Tortola, VG1110, British Virgin Islands.

(8)	VIAPC 1 Limited, a company incorporated in the Cayman Islands with limited liability, whose registered office address is at 190 Elgin Avenue, George Town, Grand Cayman, KY1-9008, Cayman Islands, owns 8.1% of the issued Shares of the Company.

 

F. Disclosure of a registrant’s action to recover erroneously awarded compensation.

 

Not applicable.

 

53

 

 

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

 

A. Major Shareholders.

 

Please refer to “Item 6. Directors, Senior Management and Employees — E. Share Ownership.”

 

B. Related Party Transactions.

 

We have adopted an audit committee charter, which requires the committee to review all related-party transactions on an ongoing basis and all such transactions be approved by the committee.

 

List of Related Parties

 

Name of related parties		Relationship with the Company
Ms. Eva Yuk Yin Siu (“Ms. Siu”)		Chairman of the Board, Director, the Controlling Shareholder
Neo-Concept (Holdings) Company Limited (“NCH”)		A company under common control of the Controlling Shareholder

 

Amounts Due From (To) Related Parties

 

The following table set forth the breakdown of our balances due from related parties as of the dates indicated:

 

		As of December 31,																As of June 30,
		2021				2022				2023				2023				2023				2023
		HKD				HKD				HKD				US$				HKD				US$
Due from Ms. Siu			100,000				70,001				55,002				7,042				55,002				7,019
Due to NCH(1)			—				—				29,724,263				3,805,485				28,620,040				3,652,239
Due from NCH			7,242,784				16,202,732				—				—				—				—

 

The amounts due from (to) the related parties are unsecured, interest free with no specific repayment terms. Neo-Concept (Holdings) Company Limited (“NCH”) is a company incorporated in Hong Kong and controlled by Ms. Siu, the controlling shareholder of the Company. As of December 31, 2021 and 2022, the amount due from NCH was non-trade nature, being fund advance to NCH for its general operation. As of June 30, 2023 and December 31, 2023, the amount due to NCH was non-trade nature, being fund advance from NCH for general operation of the Company. As at the date of this report, the balance due from Ms. Siu was HK$55,002. The amount due from Ms. Siu was fully repaid upon the Company’s IPO.

 

On June 30, 2023, NCH agreed to forgive HKD 55 million (US$7.02 million) due to NCH by the Company. The amount was credited to additional paid-in capital. The amount forgiven represented funds transferred from NCH to the Company to support the general operation of the Company during the six months period ended June 30, 2023.

 

Accounts payable — related party

 

The following table set forth the breakdown of our accounts payable — related party as of the dates indicated:

 

		As of December 31,																As of June 30,
		2021				2022				2023				2023				2023				2023
		HKD				HKD				HKD				US$				HKD				US$
Due to NCH(1)			—				—				3,361,755				430,393				6,805,337				868,438

 

 

(1)

NCH waived HKD 55 million from the amount owed to it during the six months ended June 30, 2023.

 

The accounts payable to NCH as of December 31, 2023 and June 30, 2023 were unsecured, interest free with repayment on demand.

 

During the year ended December 31, 2021, the largest amount outstanding with the related parties was HK$100,000 due from Ms. Siu and HK$35,676,751 due from NCH. During the year ended December 31, 2022, the largest amount outstanding with the related parties was HK$100,000 due from Ms. Siu and HK$39,333,707 due from NCH. During the six months ended June 30, 2023, the largest amount outstanding with the related parties was HK$55,002 from Ms. Siu and HK$35,425,377 due to NCH. During the year ended December 31, 2023, the largest amount outstanding with the related parties was HK$55,002 from Ms. Siu and HK$33,086,018 due to NCH.

 

54

 

 

Transactions with Related Parties

 

Related party transactions during the three years ended December 31, 2021, 2022 and 2023

 

				For the Years Ended December 31,
		Nature		2021				2022				2022				2023				2023
				HKD				HKD				USD				HKD				USD
Neo-Concept (Holdings) Company Limited(1)		Management fee(2)			4,223,236				—				—				—				—
Neo-Concept (Holdings) Company Limited(1)		Rental expense(3)			—				720,000				92,290				720,000				92,179
Neo-Concept (Holdings) Company Limited(1)		Purchase of apparel products(4)			29,522,341				103,159,420				13,223,024				38,351,844				4,910,042
Neo-Concept (Holdings) Company Limited(1)		Agency income received(5)			2,904,339				2,586,019				331,477				2,705,234				346,341

 

 

(1)

An affiliate company incorporated in Hong Kong indirectly wholly-owned by the Controlling Shareholders.

(2)

Management fees, which included office overhead including rental and shared human resources expenses, were paid by Neo-Concept HK for use of the Hong Kong office located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong for the years ended December 31, 2021. In December 2021, a group of employees of NCH were transferred to Neo-Concept HK and the arrangement for sharing human resource expenses was discontinued. On January 1, 2022, Neo-Concept HK and NCH entered into an official rental agreement for use of the Hong Kong office and the rental fees were accounted for as rental expenses for the year ended December 31, 2022 and 2023.

(3)

Rental expenses were paid by Neo-Concept HK for the lease of office premises located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong.

(4)

During the normal course of business, Neo-Concept HK engaged NCH as supplier to produce and arrange delivery of products for its customers. The rates charged by NCH is consistent with the standard rates charged by Neo-Concept HK’s independent third-party supplier. We are of the opinion that the service fees paid to NCH, and the terms of service were negotiated at arm’s length.

(5)

Agency income refers to other income received from NCH, which was a discretionary payment made to Neo-Concept UK for promoting NCH’s products in the UK upon a pre-determined yearly sale target being achieved.

 

Related party transactions during the six months ended June 30, 2022 and 2023

 

					For the Six Months Ended June 30,
		Nature			2022				2023				2023
					HKD				HKD				USD
Neo-Concept (Holdings) Company Limited(1)		Rental expense(2)				360,000				360,000				45,876
Neo-Concept (Holdings) Company Limited(1)		Purchase of apparel products(3)				28,963,113				22,713,298				2,898,472

 

 

(1)

An affiliate company incorporated in Hong Kong indirectly wholly-owned by the Controlling Shareholders.

(2)

Rental expenses were paid by Neo-Concept HK for the lease of office premises located at 10/F, Seaview Centre, No.139-141 Hoi Bun Road, Kwun Tong, Hong Kong.

(3)

During the normal course of business, Neo-Concept HK engaged NCH as supplier to produce and arrange delivery of products for its customers. The rates charged by NCH are consistent with the standard rates charged by Neo-Concept HK’s independent third-party supplier. We are of the opinion that the service fees paid to NCH, and the terms of service were negotiated at arm’s length.

 

55

 

 

Bank Facilities and Other Borrowing

 

Bank borrowings as at December 31, 2021, 2022 and 2023 and June 30, 2023 are as follows:

 

											Balance as at December 31,																				Balance as at June 30,
Lender		Type		Maturity date		Currency			Interest rate		2021				2022				2022				2023				2023				2023				2023
											HKD				HKD				US$				HKD				US$				HKD				US$
The Hongkong and Shanghai Banking Corporation Limited(1)		Trading finance		Within 1 year			HKD		Bank prevailing rates			27,472,039				44,500,679				5,704,118				—				—				33,448,796				4,268,443
HSBC UK Bank plc(2)		Term loan		June 15, 2026			GBP		2.5%			525,615				375,059				48,075				—				—				—				—
DBS Bank (Hong Kong) Limited(1)		Trading finance		Within 1 year			HKD		Bank prevailing rates			—				17,232,296				2,208,844				—				—				—				—
Dah Sing Bank, Limited(1)		Overdraft		Within 1 year			HKD		Bank prevailing rates			—				22,229,451				2,849,382				—				—				10,570,842				1,348,958
Citibank, N.A., Hong Kong Branch(3)		Trading finance		Within 1 year			US$		Bank prevailing rates			—				—				—				5,809,927				743,823				—				—
Total												27,997,654				84,337,485				10,810,419				5,809,927				743,823				44,019,638				5,617,401

 

 

(1)

Neo-Concept HK, together with NCH entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH. The banking facilities were secured, details of which are set out as follows:

(a)

Unlimited personal guarantee by Ms. Siu;

(b)

Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH;

(c)

Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces;

(d)

Legal charge over certain deposits accounts held by NCH at the relevant banks;

(e)

Legal charge over certain investment funds held by NCH at the relevant banks;

(f)

Assignment of benefit from life insurances premium assets held by NCH at the relevant banks;

(g)

Assignment of benefit from life insurances premium assets held by Pure Diamond Limited, a related company in which Ms. Siu has interests, at a relevant bank;

(h)

Indemnity granted by NCH to relevant banks;

(i)

Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and

(j)

Cross-corporate guaranteed by Neo-Concept HK and NCH.

(2)

The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.

(3)

Neo-Concept HK, together with NCH entered into banking facilities with Citibank, N.A., Hong Kong Branch for combined banking facilities which were shared by Neo-Concept HK and NCH. The banking facilities were secured, details of which are set out as follows:

(a)

Unlimited personal guarantee by Ms. Siu;

(b)

Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH;

(c)

Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces;

(d)

Legal charge over certain deposits accounts held by NCH at the relevant banks;

(e)

Indemnity granted by NCH to relevant banks; and

(f)

Cross-corporate guaranteed by Neo-Concept HK and NCH.

 

Policies and Procedures for Related Party Transactions

 

Our board of directors has created an audit committee and adopted an audit committee charter, which requires the committee to review and approve of all related party transactions.

 

56

 

 

C. Interests of Experts and Counsel

 

Not applicable.

 

ITEM 8. FINANCIAL INFORMATION

 

A. Consolidated Statements and Other Financial Information.

 

See “Item 18. Financial Statements” for our audited consolidated financial statements.

 

Legal Proceedings

 

As of the date of this report, we and our subsidiaries are not a party to, and we are not aware of any threat of, any legal proceeding that, in the opinion of our management, is likely to have a material adverse effect on our or our subsidiaries business, financial condition or operations.

 

From time to time, we may become involved in legal proceedings arising in the ordinary course of business. Other than the civil proceeding mentioned above, we are not involved in any litigation, arbitration or claim of material importance, nor any material impact non-compliance incidents or systemic non-compliance incidents in respect of applicable laws and regulations.

 

Dividend Policy

 

We currently intend to retain all available funds and future earnings, if any, for the operation and expansion of our business, and we do not anticipate declaring or paying any dividends in the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition, results of operations, capital requirements, contractual requirements, business prospects and other factors the board of directors deems relevant, and subject to the restrictions contained in any future financing instruments.

 

In December 2021, Neo-Concept HK disposed of Neo-Concept (NY) Corporation to Neo-Concept (BVI) Limited via distribution, which involved a distribution of cash of HK$266,559 (US$34,176) and distribution of non-cash assets and liabilities having a net carrying value of HK$2,248,550 (US$288,290). During the years ended December 31, 2023, 2022 and 2021, save for the distribution in cash and in specie in December 2021, NCI did not declare or pay any other dividends and there were no transfer of assets among NCI and its subsidiaries. During the years ended December 31, 2023, 2022 and 2021, NCI and its subsidiaries did not declare or pay any dividends or distributions to U.S. investors.

 

The declaration, amount and payment of any future dividends will be at the sole discretion of our board of directors, subject to compliance with applicable Cayman Islands laws regarding solvency. Our board of directors will take into account general economic and business conditions, our financial condition and results of operations, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions and other implications on the payment of dividends by us to our shareholders or by our subsidiaries to us, and such other factors as our board of directors may deem relevant.

 

Subject to the Companies Act and our Memorandum and Articles of Association, our Company in general meeting may declare dividends in any currency to be paid to the members but no dividend shall be declared in excess of the amount recommended by our board of directors. Subject to a solvency test, as prescribed in the Companies Act, and the provisions of our Memorandum and Articles of Association, a company may pay dividends and distributions out of its share premium account. In addition, based upon English case law which is likely to be persuasive in the Cayman Islands, dividends may be paid out of profits.

 

As we are a holding company, we rely on dividends paid to us by our subsidiaries for our cash requirements, including funds to pay any dividends and other cash distributions to our shareholders, service any debt we may incur and pay our operating expenses. Our ability to pay dividends to our shareholders will depend on, among other things, the availability of dividends from our subsidiaries.

 

57

 

 

Cash dividends, if any, on our Ordinary Shares will be paid in U.S. dollars.

 

Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us.

 

B. Significant Changes.

 

Except as disclosed elsewhere in this Annual Report, we have not experienced any significant changes since the date of our audited consolidated financial statements included in this Annual Report.

 

ITEM 9. THE OFFER AND LISTING

 

A. Offer and Listing Details.

 

Not applicable.

 

B. Plan of Distribution.

 

Not applicable.

 

C. Markets.

 

Not applicable.

 

D. Selling Shareholders.

 

Not applicable.

 

E. Dilution.

 

Not applicable.

 

F. Expenses of the Issue.

 

Not applicable.

 

ITEM 10. ADDITIONAL INFORMATION

 

A. Share Capital.

 

As of the date of this Annual Report, we are authorized to issue a maximum of 300,000,000 Ordinary Shares, $0.0001 par value per share and 300,000,000 Non-voting Ordinary Shares with a par value of US$0.0001 each.

 

B. Memorandum and Articles of Association.

 

We incorporate by reference into this Annual Report the description of our amended and restated memorandum and articles of association contained in our registration statement on Form F-1 (File No. 333-275242) originally filed with the Securities and Exchange Commission on November 1, 2023, as amended.

 

The following are summaries of material provisions of our Amended and Restated Memorandum and Articles of Association as they relate to the material terms of our ordinary shares.

 

Ordinary Shares

 

General

 

All of our outstanding Ordinary Shares are fully paid and non-assessable. Certificates representing the Ordinary Shares are issued in registered form. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Ordinary Shares. We may not issue shares to bearer.

 

58

 

 

Dividends

 

Subject to the Companies Act and our Memorandum and Articles of Association, our Company in general meeting may declare dividends in any currency to be paid to the members but no dividend shall be declared in excess of the amount recommended by our board of directors.

 

Except in so far as the rights attaching to, or the terms of issue of, any share may otherwise provide:

 

(i)

all dividends shall be declared and paid according to the amounts paid up on the shares in respect of which the dividend is paid, although no amount paid up on a share in advance of calls shall for this purpose be treated as paid up on the share;

 

(ii)

all dividends shall be apportioned and paid pro rata in accordance with the amount paid up on the shares during any portion(s) of the period in respect of which the dividend is paid; and

 

(iii)

our board of directors may deduct from any dividend or other monies payable to any member all sums of money (if any) presently payable by him to our Company on account of calls, instalments or otherwise.

 

Where our board of directors or our Company in general meeting has resolved that a dividend should be paid or declared, our board of directors may resolve:

 

(aa)

that such dividend be satisfied wholly or in part in the form of an allotment of shares credited as fully paid up, provided that the members entitled to such dividend will be entitled to elect to receive such dividend (or part thereof) in cash in lieu of such allotment; or

 

(bb)

that the members entitled to such dividend will be entitled to elect to receive an allotment of shares credited as fully paid up in lieu of the whole or such part of the dividend as our board of directors may think fit.

 

Upon the recommendation of our board of directors, our Company may by ordinary resolution in respect of any one particular dividend of our Company determine that it may be satisfied wholly in the form of an allotment of shares credited as fully paid up without offering any right to members to elect to receive such dividend in cash in lieu of such allotment.

 

Any dividend, bonus, or other sum payable in cash to the holder of shares may be paid by cheque or warrant sent through the post. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and shall be sent at the holder’s or joint holders’ risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to our Company. Any one of two or more joint holders may give effectual receipts for any dividends or other monies payable or property distributable in respect of the shares held by such joint holders.

 

Whenever our board of directors or our Company in general meeting has resolved that a dividend be paid or declared, our board of directors may further resolve that such dividend be satisfied wholly or in part by the distribution of specific assets of any kind.

 

Our board of directors may, if it thinks fit, receive from any member willing to advance the same, and either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced may pay interest at such rate (if any) not exceeding 20% per annum, as our board of directors may decide, but a payment in advance of a call shall not entitle the member to receive any dividend or to exercise any other rights or privileges as a member in respect of the share or the due portion of the shares upon which payment has been advanced by such member before it is called up.

 

All dividends, bonuses, or other distributions unclaimed for one year after having been declared may be invested or otherwise used by our board of directors for the benefit of our Company until claimed and our Company shall not be constituted a trustee in respect thereof. All dividends, bonuses, or other distributions unclaimed for six years after having been declared may be forfeited by our board of directors and, upon such forfeiture, shall revert to our Company.

 

59

 

 

No dividend or other monies payable by our Company on or in respect of any share shall bear interest against our Company.

 

Our Company may exercise the power to cease sending cheques for dividend entitlements or dividend warrants by post if such cheques or warrants remain uncashed on two consecutive occasions or after the first occasion on which such a cheque or warrant is returned undelivered.

 

Voting Rights

 

Subject to any special rights, restrictions or privileges as to voting for the time being attached to any class or classes of shares at any general meeting: (a) on a poll every member present in person or by proxy or, in the case of a member being a corporation, by our duly authorized representative shall have one vote for every share which is fully paid or credited as fully paid registered in his name in the register of members of our Company but so that no amount paid up or credited as paid up on a share in advance of calls or instalments is treated for this purpose as paid up on the share; and (b) on a show of hands every member who is present in person (or, in the case of a member being a corporation, by our duly authorized representative) or by proxy shall have one vote. Where more than one proxy is appointed by a member which is a Clearing House (as defined in the Articles) (or its nominee(s)) or a central depository house (or its nominee(s)), each such proxy shall have one vote on a show of hands. On a poll, a member entitled to more than one vote need not use all his votes or cast all the votes he does use in the same way.

 

Transfer of Ordinary Shares

 

Subject to the Companies Act and our Articles of Association, all transfers of shares shall be effected by an instrument of transfer in the usual or common form or in such other form as our board of directors may approve and may be under hand or, if the transferor or transferee is a Clearing House (as defined in the Articles) (or its nominee(s)) or a central depository house (or its nominee(s)), under hand or by machine imprinted signature, or by such other manner of execution as our board of directors may approve from time to time.

 

Execution of the instrument of transfer shall be by or on behalf of the transferor and the transferee, provided that our board of directors may dispense with the execution of the instrument of transfer by the transferor or transferee or accept mechanically executed transfers. The transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the register of members of our Company in respect of that share.

 

Our board of directors may, in our absolute discretion, at any time and from time to time remove any share on the principal register to any branch register or any share on any branch register to the principal register or any other branch register. Unless our board of directors otherwise agrees, no shares on the principal register shall be removed to any branch register nor shall shares on any branch register be removed to the principal register or any other branch register. All removals and other documents of title shall be lodged for registration and registered, in the case of shares on any branch register, at the registered office and, in the case of shares on the principal register, at the place at which the principal register is located.

 

Our board of directors may, in our absolute discretion, decline to register a transfer of any share (not being a fully paid up share) to a person of whom it does not approve or on which our Company has a lien. It may also decline to register a transfer of any share issued under any share option scheme upon which a restriction on transfer subsists or a transfer of any share to more than four joint holders.

 

Our board of directors may decline to recognize any instrument of transfer unless a certain fee, up to such maximum sum as Nasdaq may determine to be payable, is paid to our Company, the instrument of transfer is properly stamped (if applicable), is in respect of only one class of share and is lodged at our registered office or the place at which the principal register is located accompanied by the relevant share certificate(s) and such other evidence as our board of directors may reasonably require is provided to show the right of the transferor to make the transfer (and if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do).

 

60

 

 

The registration of transfers of shares or of any class of shares may, after compliance with any notice requirement of Nasdaq, be suspended at such times and for such periods (not exceeding in the whole thirty days in any year) as our board of directors may determine.

 

Fully paid shares shall be free from any restriction on transfer (except when permitted by Nasdaq) and shall also be free from all liens.

 

Procedures on liquidation

 

A resolution that our Company be wound up by the court or be wound up voluntarily shall be a special resolution of our shareholders.

 

Subject to any special rights, privileges, or restrictions as to the distribution of available surplus assets on liquidation for the time being attached to any class or classes of shares:

 

(i)

if our Company is wound up, the surplus assets remaining after payment to all creditors shall be divided among the members in proportion to the capital paid up on the shares held by them respectively; and

 

(ii)

if our Company is wound up and the surplus assets available for distribution among the members are insufficient to repay the whole of the paid-up capital, such assets shall be distributed, subject to the rights of any shares which may be issued on special terms and conditions, so that, as nearly as may be, the losses shall be borne by the members in proportion to the capital paid up on the shares held by them, respectively.

 

If our Company is wound up (whether the liquidation is voluntary or compelled by the court), the liquidator may, with the sanction of a special resolution and any other sanction required by the Companies Act, divide among the members in specie or kind the whole or any part of the assets of our Company, whether the assets consist of property of one kind or different kinds, and the liquidator may, for such purpose, set such value as he deems fair upon any one or more class or classes of property to be so divided and may determine how such division shall be carried out as between the members or different classes of members and the members within each class. The liquidator may, with the like sanction, vest any part of the assets in trustees upon such trusts for the benefit of members as the liquidator thinks fit, but so that no member shall be compelled to accept any shares or other property upon which there is a liability.

 

Calls on Ordinary Shares and Forfeiture of Ordinary Shares

 

Subject to these Articles and to the terms of allotment, our board of directors may, from time to time, make such calls as it thinks fit upon the members in respect of any monies unpaid on the shares held by them respectively (whether on account of the nominal value of the shares or by way of premium) and not by the conditions of allotment of such shares made payable at fixed times. A call may be made payable either in one sum or by instalments. If the sum payable in respect of any call or instalment is not paid on or before the day appointed for payment thereof, the person or persons from whom the sum is due shall pay interest on the same at such rate not exceeding 20% per annum as our board of directors shall fix from the day appointed for payment to the time of actual payment, but our board of directors may waive payment of such interest wholly or in part. Our board of directors may, if it thinks fit, receive from any member willing to advance the same, either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced our Company may pay interest at such rate (if any) not exceeding 20% per annum as our board of directors may decide.

 

61

 

 

If a member fails to pay any call or instalment of a call on the day appointed for payment, our board of directors may, for so long as any part of the call or instalment remains unpaid, serve not less than 14 days’ notice on the member requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued and which may still accrue up to the date of actual payment. The notice shall name a further day (not earlier than the expiration of 14 days from the date of the notice) on or before which the payment required by the notice is to be made and shall also name the place where payment is to be made. The notice shall also state that, in the event of non-payment at or before the appointed time, the shares in respect of which the call was made will be liable to be forfeited.

 

If the requirements of any such notice are not complied with, any share in respect of which the notice has been given may at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of our board of directors to that effect. Such forfeiture will include all dividends and bonuses declared in respect of the forfeited share and not actually paid before the forfeiture.

 

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, nevertheless, remain liable to pay to our Company all monies which, at the date of forfeiture, were payable by him to our Company in respect of the shares together with (if our board of directors shall in our discretion so require) interest thereon from the date of forfeiture until payment at such rate not exceeding 20% per annum as our board of directors may prescribe.

 

Redemption of Ordinary Shares

 

Subject to the Companies Act, our Articles of Association, and, where applicable, the Nasdaq listing rules or any other law or so far as not prohibited by any law and subject to any rights conferred on the holders of any class of Shares, any power of our Company to purchase or otherwise acquire all or any of its own Shares (which expression as used in this Article includes redeemable Shares) be exercisable by our board of directors in such manner, upon such terms and subject to such conditions as it thinks fit.

 

Subject to the Companies Act, our Articles of Association, and to any special rights conferred on the holders of any Shares or attaching to any class of Shares, Shares may be issued on the terms that they may, at the option of our Company or the holders thereof, be liable to be redeemed on such terms and in such manner, including out of capital, as our board of directors may deem fit.

 

Variations of Rights of Shares

 

Subject to the Companies Act and without prejudice to our Articles of Association, if at any time the share capital of our Company is divided into different classes of shares, all or any of the special rights attached to any class of shares may (unless otherwise provided for by the terms of issue of the shares of that class) be varied, modified or abrogated with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of that class. The provisions of the Articles relating to general meetings shall mutatis mutandis apply to every such separate general meeting, but so that the necessary quorum (whether at a separate general meeting or at its adjourned meeting) shall be not less than a person or persons together holding (or, in the case of a member being a corporation, by our duly authorized representative) or representing by proxy not less than one-third in nominal value of the issued shares of that class. Every holder of shares of the class shall be entitled on a poll to one vote for every such share held by him, and any holder of shares of the class present in person or by proxy may demand a poll.

 

Any special rights conferred upon the holders of any shares or class of shares shall not, unless otherwise expressly provided in the rights attaching to the terms of issue of such shares, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

 

General Meetings of Shareholders

 

Our Company must hold an annual general meeting each fiscal year other than the fiscal year of our Company’s adoption of our Articles of Association.

 

62

 

 

Extraordinary general meetings may be convened on the requisition of one or more members holding, at the date of deposit of the requisition, not less than one tenth of the paid-up capital of our Company having the right of voting at general meetings. Such requisition shall be made in writing to our board of directors or the secretary of our Company for the purpose of requiring an extraordinary general meeting to be called by our board of directors for the transaction of any business specified in such requisition. Such meeting shall be held within two months after the deposit of such requisition. If within 21 days of such deposit, our board of directors fails to proceed to convene such meeting, the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of our board of directors shall be reimbursed to the requisitionist(s) by our Company.

 

Every general meeting of our Company shall be called by at least 10 clear days’ notice in writing. The notice shall be exclusive of the day on which it is served or deemed to be served and of the day for which it is given, and must specify the time, place and agenda of the meeting and particulars of the resolution(s) to be considered at that meeting and the general nature of that business.

 

Although a meeting of our Company may be called by shorter notice than as specified above, such meeting may be deemed to have been duly called if it is so agreed:

 

(i)

in the case of an annual general meeting, by all members of our Company entitled to attend and vote thereat; and

 

(ii)

in the case of any other meeting, by a majority in number of the members having a right to attend and vote at the meeting holding not less than 95% of the total voting rights at the meetings of all our shareholders.

 

All business transacted at an extraordinary general meeting shall be deemed special business. All business shall also be deemed special business where it is transacted at an annual general meeting, with the exception of the election of Directors which shall be deemed ordinary business.

 

No business other than the appointment of a chairman of a meeting shall be transacted at any general meeting unless a quorum is present when the meeting proceeds to business and continues to be present until the conclusion of the meeting.

 

The quorum for a general meeting shall be two members entitled to vote and present in person (or in the case of a member being a corporation, by our duly authorized representative) or by proxy representing not less than one-third (1/3) in nominal value of the total issued voting shares in our Company throughout the meeting.

 

Inspection of Books and Records

 

Our shareholders have no general right to inspect or obtain copies of the register of members or corporate records of our company. They will, however, have such rights as may be set out in our Articles of Association.

 

Changes in Capital

 

Subject to the Companies Act, our shareholders may, by ordinary resolution:

 

(a)

increase our share capital by new shares of the amount fixed by that ordinary resolution and with the attached rights, priorities and privileges set out in that ordinary resolution;

 

(b)

consolidate and divide all or any of our share capital into shares of larger amount than our existing shares;

 

(c)

sub-divide our shares or any of them into our shares of smaller amount than is fixed by our Company’s Memorandum of Association, so, however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced our shares shall be the same as it was in case of the share from which the reduced our shares is derived;

 

(d)

cancel any shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so cancelled; and

 

(e)

convert all or any of our paid-up shares into stock and reconvert that stock into paid up shares of any denomination.

 

Subject to the Companies Act and to any rights for the time being conferred on the shareholders holding a particular class of shares, our shareholders may, by special resolution, reduce our share capital or any capital redemption reserve in any way.

 

63

 

 

C. Material Contracts.

 

We have not entered into any material contracts other than in the ordinary course of business and other than those described in this Annual Report.

 

D. Exchange controls.

 

There is no exchange control regulations or currency restrictions in effect in the Cayman Islands.

 

E. Taxation.

 

The following is a discussion on certain Cayman Islands and Hong Kong income tax consequences of an investment in the Ordinary Shares. The discussion is a general summary of present law, which is subject to prospective and retroactive change. It is not intended as tax advice, does not consider any investor’s particular circumstances, and does not consider tax consequences other than those arising under Cayman Islands and Hong Kong laws.

 

Hong Kong Taxation

 

The following summary of certain relevant taxation provisions under the laws of Hong Kong is based on current law and practice and is subject to changes therein. This summary does not purport to address all possible tax consequences relating to purchasing, holding, or selling our Ordinary Shares, and does not take into account the specific circumstances of any particular investors, some of whom may be subject to special rules. Accordingly, holders or prospective purchasers (particularly those subject to special tax rules, such as banks, dealers, insurance companies and tax-exempt entities) should consult their own tax advisers regarding the tax consequences of purchasing, holding or selling our Ordinary Shares. Under the current laws of Hong Kong:

 

●

No profit tax is imposed in Hong Kong in respect of capital gains from the sale of the Ordinary Shares.

 

●

Revenues gains from the sale of our Ordinary Shares by persons carrying on a trade, profession or business in Hong Kong where the gains are derived from or arise in Hong Kong from the trade, profession or business will be chargeable to Hong Kong profits tax, which is currently imposed at the rate of 16.5% on corporations and at a maximum rate of 15% on individuals and unincorporated businesses.

 

●

Gains arising from the sale of Ordinary Shares, where the purchases and sales of the Ordinary Shares are effected outside of Hong Kong such as, for example, in the Cayman Islands, should not be subject to Hong Kong profits tax.

 

According to the current tax practice of the Hong Kong Inland Revenue Department, dividends paid on the Ordinary Shares would not be subject to any Hong Kong tax.

 

No Hong Kong stamp duty is payable on the purchase and sale of the Ordinary Shares.

 

BVI Taxation

 

All distributions, interest and other amounts paid by NCA to persons who are not resident in the BVI are exempt from the Income Tax Ordinance in the BVI. No estate, inheritance, succession or gift tax, rate, duty, levy or other charge is payable by persons who are not resident in the BVI with respect to any shares, debt obligation or other securities of NCA. All instruments relating to transfers of property to or by NCA and all instruments relating to transactions in respect of the shares, debt obligations or other securities of NCA and all instruments relating to other transactions relating to the business of NCA are exempt from payment of stamp duty in the BVI provided that they do not relate to real estate in the BVI. There are currently no withholding taxes or exchange control regulations in the BVI applicable to NCA or its shareholders.

 

UK Taxation

 

The following statements are of a general nature and do not purport to be a complete analysis of all potential UK tax consequences of acquiring, holding, and disposing of our Ordinary Shares. They are based on current UK tax law and on the current published practice of His Majesty’s Revenue and Customs (“HMRC”), as of the date of this report, all of which are subject to change, possibly with retrospective effect. They are intended to address only certain United Kingdom tax consequences for holders of our Ordinary Shares who are tax resident in (and only in) the United Kingdom, and in the case of individuals, domiciled in (and only in) the United Kingdom who are the absolute beneficial owners of our Ordinary Shares and any dividends paid on them and who hold our Ordinary Shares as investments (other than in an individual savings account or a self-invested personal pension). They do not address the UK tax consequences which may be relevant to certain classes of holders of our Ordinary Shares such as traders, brokers, dealers, banks, financial institutions, insurance companies, investment companies, collective investment schemes, tax-exempt organizations, trustees, persons connected with us or a member of our group, persons holding our Ordinary Shares as part of hedging or conversion transactions, holders of our Ordinary Shares who have (or are deemed to have) acquired our Ordinary Shares by virtue of an office or employment. The statements do not apply to any holder of our Ordinary Shares who either directly or indirectly holds or controls 10% or more of our share capital (or class thereof), voting power or profits.

 

64

 

 

This summary is written on the basis that the Company is and remains resident for tax purposes outside the UK and will therefore not be subject to the UK tax regime (save as in respect of any UK source income). Any dividends paid by the Company will, on this basis, not be regarded as UK dividends.

 

The following is intended only as a general guide and is not intended to be, nor should it be considered to be, legal or tax advice to any particular prospective subscriber for, or purchaser of, our Ordinary Shares. Accordingly, prospective subscribers for, or purchasers of, our Ordinary Shares who are in any doubt as to their tax position regarding the acquisition, ownership, and disposition of our Ordinary Shares or who are subject to tax in a jurisdiction other than the United Kingdom should consult their own tax advisers.

 

Taxation of dividends

 

Withholding tax

 

We will not be required to withhold UK tax at source when paying dividends on our Ordinary Shares.

 

Income tax

 

An individual holder of our Ordinary Shares who is resident for tax purposes in the UK may, depending on his or her particular circumstances, be subject to UK tax on dividends received from us.

 

All dividends received by a UK resident individual holder of our Ordinary Shares from us or from other sources will form part of that holder’s total income for income tax purposes and will constitute the top slice of that income. A nil rate of income tax will apply to the first £1,000 of taxable dividend income received by the holder of our Ordinary Shares in the tax year ending 5 April 2024. The amount of dividend income subject to this nil rate (the “dividend allowance”) will reduce to £500 from 6 April 2024. Income within the nil rate dividend allowance will be taken into account in determining whether income in excess of the dividend allowance falls within the basic rate, higher rate or additional rate tax bands. Where the dividend income is above the dividend allowance, an amount of dividend income equal to the dividend allowance will be charged at the nil rate and any excess amount will be taxed at 8.75 per cent. to the extent that the excess amount falls within the basic rate tax band, 33.75 per cent. to the extent that the excess amount falls within the higher rate tax band and 39.35 per cent. to the extent that the excess amount falls within the additional rate tax band.

 

Corporation tax

 

Corporate holders of our Ordinary Shares that are resident for tax purposes in the UK should not be subject to UK corporation tax on any dividend received from us so long as the dividends qualify for exemption and certain conditions are met (including anti-avoidance conditions).

 

Taxation of disposals

 

A disposal or deemed disposal of our Ordinary Shares by an individual or corporate holder of such shares who is tax resident in the United Kingdom may, depending on that holder’s circumstances and subject to any available exemptions or reliefs (including, for example, the annual exempt amount for individuals which is currently £6,000, but will reduce to £3,000 from 6 April 2024), give rise to a taxable chargeable gain or allowable loss for the purposes of UK taxation of chargeable gains.

 

Any chargeable gain (or allowable loss) will generally be calculated by reference to the consideration received for the disposal of our Ordinary Shares less the allowable cost to the holder of acquiring such shares.

 

The applicable tax rates for individual holders of our Ordinary Shares realizing a gain on the disposal of such shares is, broadly, 10% for basic rate taxpayers and 20% for higher and additional rate taxpayers. The applicable tax rate for corporate holders of our Ordinary Shares realizing a gain on the disposal of such shares is currently 25 per cent. where the corporate holder has profits over £250,000 in the relevant period.

 

UK stamp duty (“Stamp Duty”) and UK stamp duty reserve tax (“SDRT”)

 

No UK Stamp Duty or SDRT should arise on the issue of our Ordinary Shares.

 

Subject to any available exemptions, UK Stamp Duty at a rate of 0.5% will in principle be payable on any instrument of transfer of Ordinary Shares that is executed in the United Kingdom or that relates to any property situated, or to any matter or thing done or to be done, in the United Kingdom.

 

Provided that Ordinary Shares are not registered in any register maintained in the United Kingdom by or on behalf of us and are not paired with any shares issued by a UK incorporated company, any agreement to transfer Ordinary Shares will not be subject to SDRT.

 

65

 

 

F. Dividends and paying agents.

 

Not applicable.

 

G. Statement by experts.

 

Not applicable.

 

H. Documents on display.

 

We are subject to the periodic reporting and other informational requirements of the Exchange Act. Under the Exchange Act, we are required to file reports and other information with the SEC. Specifically, we are required to file annually a Form 20-F no later than four months after the close of each fiscal year and submit other information under cover of Form 6-K. Annual Reports and other information we file with the SEC may be inspected at the public reference facilities maintained by the SEC at Room 1024, 100 F. Street, N.E., Washington, D.C. 20549, and copies of all or any part thereof may be obtained from such offices upon payment of the prescribed fees. You may call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms and you can request copies of the documents upon payment of a duplicating fee, by writing to the SEC. In addition, the SEC maintains a web site that contains reports and other information regarding registrants (including us) that file electronically with the SEC which can be accessed at www.sec.gov.

 

Our Internet website is wwneo-ig.com. We make our Annual Reports on Form 20-F and any amendments to such reports available free of charge on our website as soon as reasonably practicable following the electronic filing of each report with the SEC. In addition, we provide copies of our filings free of charge upon request. The information contained on our website is not part of this or any other report filed with or furnished to the SEC.

 

As a foreign private issuer, we are exempt from the proxy requirements of Section 14 of the Exchange Act and our officers, directors and principal shareholders will be exempt from the insider short-swing disclosure and profit recovery rules of Section 16 of the Exchange Act.

 

I. Subsidiary Information

 

See ITEM 4.C and Exhibit 8.1 for our list of subsidiaries.

 

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

 

Credit risk

 

Our assets that potentially subject to a significant concentration of credit risk primarily consist of cash and accounts receivable.

 

We believe that there is no significant credit risk associated with cash in Hong Kong, which were held by reputable financial institutions in the jurisdiction where Neo-Concept HK is located. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately US$63,806) if the bank with which an individual/a company hold its eligible deposit fails. As of December 31, 2023, cash balance of HKD 913,267 (US$116,922) was maintained at financial institutions in Hong Kong and approximately HKD 500,000 was insured by the Hong Kong Deposit Protection Board.

 

As of December 31, 2023, HKD 4,723,157 (approximately US$604,689) was deposited with financial institutions located in UK, which was substantially insured under the Financial Services Compensation Scheme. Accordingly, it is not exposed to significant credit risk.

 

We have designed credit policies with an objective to minimize their exposure to credit risk. Our accounts receivable is short term in nature and the associated risk is minimal. We conduct credit evaluations on our clients and generally do not require collateral or other security from such clients. We periodically evaluate the creditworthiness of the existing clients in determining an allowance for doubtful accounts primarily based upon the age of the receivables and factors surrounding the credit risk of specific clients.

 

We are also exposed to risk from account receivables. These assets are subjected to credit evaluations. An allowance, where applicable, would make for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

 

66

 

 

Customer concentration risk

 

For the year ended December 31, 2021, one customer accounted for 94.5% of our total revenue. For the year ended December 31, 2022, one customer accounted for 91.4% of our total revenue. For the year ended December 31, 2023, one customer accounted for 71.3% of our total revenue. No other customer accounts for more than 10% of our revenue for the years ended December 31, 2021, 2022 and 2023.

 

As of December 31, 2022, one customer accounted for 83.2% of the total balance of accounts receivable. As of December 31, 2023, four customers accounted for 44.7%, 21.6%, 11.0% and 10.1% of the total balance of accounts receivable. No other customer accounts for more than 10% of our accounts receivable as of December 31, 2022 and 2023.

 

For details of the customer concentration risk, please refer to the section headed “Risk Factors — Risks Relating to Our Business and Industry — We rely on one major customer, and if we fail to attract new customers, retain existing customers, or maintain or increase sales to customers, our business, financial condition, results of operations, and growth prospects will be harmed.” for additional information.

 

Vendor concentration risk

 

For the year ended December 31, 2021, two vendors accounted for 86.5% and 13.5% of our total purchases. For the year ended December 31, 2022, two vendors accounted for 44.2% and 35.9% of our total purchases. For the year ended December 31, 2023, two vendors accounted for 69.3% and 24.6% of our total purchases. No other vendor accounts for more than 10% of our purchases for the years ended December 31, 2021, 2022 and 2023.

 

As of December 31, 2022, three vendors accounted for 44.8%, 41.6% and 13.6% of the total balance of accounts payable. No accounts payables as of December 31, 2023. No other vendor accounts for more than 10% of our accounts payable as of December 31, 2022 and 2023

 

For details of the vendor concentration risk, please refer to the section headed “Risk Factors — Risks Relating to Our Business and Industry — We rely on two principal suppliers for supplies of raw materials, manufacturing services and logistics services.” for additional information.

 

Interest rate risk

 

Our exposure on fair value interest rate risk mainly arises from our fixed deposits with bank. We also have exposure on cash flow interest rate risk which is mainly arising from our deposits with banks and bank borrowings.

 

In respect of the exposure to cash flow interest rate risk arising from floating rate non-derivative financial instruments held by us, such as cash deposits and bank borrowings, at the end of the reporting period, we are not exposed to significant interest rate risk as the interest rates are not expected to change significantly.

 

Foreign currency risk

 

We are exposed to foreign currency risk primarily through sales that are denominated in a currency other than the functional currency of the operations to which they relate. The currencies giving rise to this risk are primarily US$. As HKD is currently pegged to US$, our exposure to foreign exchange fluctuations is minimal.

 

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

 

Not applicable.

 

67

 

 

PART II

 

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

 

We have not had a default of any indebtedness, and there has not been any arrearage in the payment of dividends.

 

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

 

See “Item 10. Additional Information” for a description of the rights of shareholders, which remain unchanged.

 

Use of Proceeds

 

On April 22, 2024, the Company entered into an underwriting agreement with Revere as underwriters named thereof, in connection with its initial public offering (“IPO”) of 2,320,000 Ordinary Shares at a price of $4.00 per share. The Company’s Registration Statement on Form F-1 (File No. 333-275242) for the IPO, originally filed with the U.S. Securities and Exchange Commission (the “Commission”) on November 1, 2024 (as amended, the “Registration Statement”) was declared effective by the Commission on April 1, 2024. The total expenses incurred for our company’s account in connection with our IPO was approximately HK$20.3 million (US$2.6 million), which included US$0.7 million in underwriting discounts and commissions for the IPO and approximately US$1.9 million in other costs and expenses for our IPO. We received net proceeds of approximately HK52.3 million (US$6.7) million from our IPO. None of the transaction expenses included payments to directors or officers of our company or their associates, persons owning more than 10% or more of our equity securities or our affiliates. None of the net proceeds from the IPO were paid, directly or indirectly, to any of our directors or officers or their associates, persons owning 10% or more of our equity securities or our affiliates.

 

The unutilized net proceeds received from our IPO were mainly kept as bank deposits. As of December 31, 2023, we had not utilized any proceeds for strengthening of our corporate finance advisory business and other general corporate purposes, respectively.

 

As disclosed in the registration statement on Form F-1, we plan to use the net proceeds of the IPO as follows:

 

●

Approximately 20% for developing new products with sustainable materials and process;

 

●

Approximately 10% for broadening customer base;

 

●

Approximately 30% for potential acquisition of companies and/or formation of joint ventures; and

 

●

The balance 40% to fund the working capital of our existing operation and for other general corporate purposes.

 

Due to a change in market condition, we intend to reallocate the 10% net proceeds originally allocated for enhancing our brand and expanding our office operation to fund our working capital and for other general corporate purposes. We intend to use the remainder of the proceeds from our IPO as disclosed in our registration statement on Form F-1

 

ITEM 15. CONTROLS AND PROCEDURES

 

a. Disclosure Controls and Procedures

 

Our management, with the participation of our chief executive officer and chief financial officer, has performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report, as required by Rule 13a-15(b) under the Exchange Act.

 

Based upon that evaluation, our management has concluded that, as of December 31, 2023, our disclosure controls and procedures were effective.

 

68

 

 

b. Management’s Annual Report on Internal Control Over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15 (f) under the Exchange Act. Our management, with the participation of our chief executive officer and our chief financial officer, evaluated the effectiveness of our internal control over financial reporting based on criteria established in the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management has concluded that our internal control over financial reporting was effective as of December 31, 2023.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

 

c. Attestation report of the registered public accounting firm

 

This Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC.

 

d. Changes in internal control over financial reporting

 

Except for the matters described above, there have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the year ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

 

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

 

Our Board of Directors has determined that Mr. To Wai Suen qualifies as an “audit committee financial expert”, and is independent for the purposes of the Nasdaq Listing Rules and Rule 10A-3 under the Exchange Act.

 

ITEM 16B. CODE OF BUSINESS CONDUCT AND ETHICS

 

We have adopted a Code of Business Conduct and Ethics that applies to our directors, officers and employees. The Code of Business Conduct and Ethics is designed to deter wrongdoing and to promote ethical conduct and full, fair, accurate, timely and understandable reports that the Company files or submits to the SEC and others. We have filed our Code of Business Conduct and Ethics as an exhibit to this Annual Report.

 

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

 

The following table sets forth the aggregate fees by categories specified below in connection with certain professional services rendered by our principal external independent registered public accountant firms in 2022 and 2023.

 

		2022				2023				2023
		HK$				HK$				US$
Audit Fees			1,100,000				1,334,000				170,000
Audit-Related Fees			—				—
Tax Fees			—				—				—
All Other Fees			—				—				—
Total			1,100,000				1,334,000				170,000

 

Audit Fees

 

Audit fees represent the aggregate fees billed for the audit of our annual financial statements, review of our interim financial statements, review of registration statements or services that are normally provided in connection with statutory and regulatory filings or engagements for those fiscal years.

 

69

 

 

Audit-Related Fees

 

There were no other audit-related fees billed by the principal accountant during the last two fiscal years for assurance and related services that were reasonably related to the performance of the audit not reported under “Audit Fees” above.

 

Audit Committee Pre-Approval Policies and Procedures

 

The Audit Committee of the Board of Directors on an annual basis reviews audit and non-audit services performed by the independent auditors. All audit and non-audit services are pre-approved by the Audit Committee, which considers, among other things, the possible effect of the performance of such services on the auditors’ independence.

 

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

 

None.

 

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

 

Not applicable.

 

ITEM 16F. CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT

 

None.

 

ITEM 16G. CORPORATE GOVERNANCE

 

There are no material differences in our corporate governance practices from those of U.S. domestic companies under the listing standards of NASDAQ.

 

ITEM 16H. MINE SAFETY DISCLOSURE

 

Not applicable.

 

ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTION THAT PREVENT INSPECTIONS

 

Not applicable.

 

70

 

 

PART III

 

ITEM 17. FINANCIAL STATEMENTS

 

We have elected to provide financial statements pursuant to Item 18.

 

ITEM 18. FINANCIAL STATEMENTS

 

Our consolidated financial statements are included at the end of this Annual Report.

 

ITEM 19. EXHIBITS

 

Exhibit Number		Description of Exhibit
1.1*		Form of Amended and Restated Memorandum and Articles of Association of the Company
2.1**		Specimen certificate evidencing Ordinary Shares
2.3*		Description of Securities
4.1**		Form of Executive Officer Agreement, by and between the registrant and Eva Yuk Yin Siu
4.2**		Form of Executive Officer Agreement, by and between the registrant and Patrick Kok Fai Lau
4.3**		Form of Director Agreement, by and between the registrant and Eva Yuk Yin Siu
4.4**		Form of Director Agreement, by and between the registrant and Man Chi Wai
4.5**		Form of Independent Director Agreement by and between the registrant and its independent Directors
4.6**		Form of Indemnification Agreement
4.7**		Office Lease Contract, by and between Neo-Concept (Holdings) Company Limited and Neo-Concept International Company Limited, dated as of January 1, 2022
4.8**		Trademark licensing agreement, by and between Neo-Concept (Holdings) Company Limited and the registrant, dated as of January 1, 2022
4.9**		Exclusive Territory and Non-Competition Agreement, by and between Neo-Concept (BVI) Limited, Splendid Vibe Limited, Ample Excellence Limited and the registrant, dated as of July 14, 2022
4.10**		Bank facility letter dated February 15, 2022 between Neo-Concept (Holdings) Company Limited, Neo-Concept HK and DBS Bank (Hong Kong) Limited
4.11**		Bank facility letter dated September 24, 2021 between Neo-Concept (Holdings) Company Limited, Neo-Concept HK and The Hongkong and Shanghai Banking Corporation Limited
8.1**		List of Subsidiaries
11.1**		Code of Business Conduct and Ethics
12.1*		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12.2*		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
13.1*		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1**		Clawback Policy
101 *		The following financial information from the Annual Report on Form 20-F for the fiscal year ended December 31, 2023, formatted in XBRL (Extensible Business Reporting Language) and filed electronically herewith: (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Operations; (iii) the Consolidated Statements of Changes in Shareholders’ Equity; (iv) the Consolidated Statements of Cash Flows; and (v) the Notes to the Consolidated Financial Statements.
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

*

Filed herewith

**

Previously filed

 

71

 

 

SIGNATURE

 

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.

 

	NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED
Date: May 14, 2024	By:	/s/ Eva Yuk Yin Siu
	Name:	Eva Yuk Yin Siu
	Title:	Chief Executive Officer and Director (Principal Executive Officer)

 

72

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

		Page
Report of Independent Registered Public Accounting Firm (PCAOB ID: 1171)		F-2
Consolidated Balance Sheets as of December 31, 2021 and 2022		F-3
Consolidated Statements of Income and Comprehensive Income for the Years Ended December 31, 2021, 2022 and 2023		F-4
Consolidated Statements of Changes of Shareholders’ Deficit for the Years Ended December 31, 2021, 2022 and 2023		F-5
Consolidated Statements of Cash Flows for the Years Ended December 31, 2021, 2022 and 2023		F-6
Notes to the Consolidated Financial Statements		F-7

 

F-1

 

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To:	The Board of Directors and Shareholders of Neo-Concept International Group Holdings Limited

 

Opinion on the Financial Statements

 

We have audited the accompanying consolidated balance sheets of Neo-Concept International Group Holdings Limited and its subsidiaries (collectively the “Company”) as of December 31, 2022 and 2023, and the related consolidated statements of income and comprehensive income, changes of shareholders’ deficit, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on our financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of our internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

WWC, P.C.
Certified Public Accountants
PCAOB ID: 1171

 

We have served as our auditor since 2022.
San Mateo, California
May 14, 2024

 

 

 

F-2

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2022 AND 2023

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
ASSETS
CURRENT ASSETS
Cash and cash equivalents			8,593,063				5,849,306				748,865
Accounts receivable, net			10,339,186				32,343,592				4,140,828
Other current assets, net			4,380,864				20,225,722				2,589,425
Due from related parties			16,272,733				—				—
Inventories, net			1,299,895				5,320,199				681,125
Total current assets			40,885,741				63,738,819				8,160,243
NON-CURRENT ASSETS
Property and equipment, net			54,926				1,297,682				166,137
Right-of-use assets, net			653,344				23,884,854				3,057,888
Intangible assets, net			112,049				—				—
Other non-current assets, net			159,401				1,695,474				217,065
Deferred tax assets			7,876				—				—
Total non-current assets			987,596				26,878,010				3,441,090
Total assets			41,873,337				90,616,829				11,601,333
LIABILITIES AND SHAREHOLDERS’ DEFICIT
CURRENT LIABILITIES
Bank borrowings			83,962,426				30,753,400				3,937,242
Accounts payable			10,429,941				—				—
Accruals and other payables			2,242,615				3,205,705				410,413
Due to related parties			—				34,243,244				4,384,033
Operating lease liabilities			653,344				708,829				90,750
Tax payable			4,885,548				916,436				117,329
Total current liabilities			102,173,874				69,827,614				8,939,767
NON-CURRENT LIABILITIES
Bank borrowings			375,059				—				—
Operating lease liabilities			—				23,176,025				2,967,138
Total non-current liabilities			375,059				23,176,025				2,967,138
Total liabilities			102,548,933				93,003,639				11,906,905
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ DEFICIT
Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023, 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023*			8,775				8,775				1,125
Additional paid-in capital			91,225				55,091,225				7,053,121
Accumulated other comprehensive income			1,970,738				844,791				108,156
Accumulated losses			(62,746,334	)			(58,331,601	)			(7,467,974	)
Total shareholders’ deficit			(60,675,596	)			(2,386,810	)			(305,572	)
Total liabilities and shareholders’ deficit			41,873,337				90,616,829				11,601,333

 

*	Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

 

The accompanying notes are an integral part of these consolidated financial statements.

 

F-3

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 AND 2023

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
REVENUES, NET			240,536,527				347,451,568				174,202,627				22,302,504
COST OF REVENUES
- Related parties			(29,522,341	)			(103,159,420	)			(34,213,521	)			(4,380,228	)
- External			(188,421,081	)			(202,457,187	)			(104,940,795	)			(13,435,173	)
			(217,943,422	)			(305,616,607	)			(139,154,316	)			(17,815,401	)
Gross profit			22,593,105				41,834,961				35,048,311				4,487,103
EXPENSES
Selling and marketing			(3,133,094	)			(2,631,231	)			(3,132,277	)			(401,014	)
General and administrative:
Depreciation – related party			—				(720,000	)			(720,000	)			(92,179	)
Depreciation			(2,486,443	)			(2,485,017	)			(2,540,273	)			(325,222	)
Management fee – related party			(4,223,236	)			—				—				—
Staff cost			(6,324,017	)			(12,436,317	)			(13,260,898	)			(1,697,743	)
Professional fee			(623,530	)			(3,654,819	)			(2,204,622	)			(282,249	)
Allowance for expected credit losses			—				—				(1,383,316	)			(177,101	)
Others			(1,329,634	)			(972,264	)			(2,760,400	)			(353,403	)
Total expenses			(18,119,954	)			(22,899,648	)			(26,001,786	)			(3,328,911	)
INCOME FROM OPERATION			4,473,151				18,935,313				9,046,525				1,158,192
OTHER INCOME (EXPENSES)
Interest income			1				1				92,951				11,900
Interest expense			(2,492,179	)			(6,133,455	)			(5,759,182	)			(737,326	)
Agency income – related party			2,904,339				2,586,019				2,662,034				340,810
Other income			2,313,438				—				326				42
Other expense			(5,953	)			(7,444	)			(302,784	)			(38,764	)
Total other income (expenses), net			2,719,646				(3,554,879	)			(3,306,655	)			(423,338	)
INCOME BEFORE TAX EXPENSES			7,192,797				15,380,434				5,739,870				734,854
INCOME TAX EXPENSES			(1,742,282	)			(2,979,918	)			(1,325,137	)			(169,652	)
NET INCOME			5,450,515				12,400,516				4,414,733				565,202
FOREIGN CURRENCY TRANSLATION ADJUSTMENT			138,058				2,514,162				(1,125,947	)			(143,118	)
TOTAL COMPREHENSIVE INCOME			5,588,573				14,914,678				3,288,786				422,084
Weighted average number of ordinary shares:
Basic and diluted			18,000,000				18,000,000				18,000,000				18,000,000
EARNINGS PER SHARE – BASIC AND DILUTED			0.30				0.69				0.25				0.03

 

F-4

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES OF SHAREHOLDERS’ DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 AND 2023

 

		Ordinary shares								Addition				Accumulated other comprehensive								Total
		No. of shares				Par value				paid-in capital				(losses) income				Accumulated losses				shareholders’ deficit
						HKD				HKD				HKD				HKD				HKD
BALANCE, January 1, 2021			18,000,000				8,775				91,225				(681,482	)			(78,082,256	)			(78,663,738	)
Net income			—				—				—				—				5,450,515				5,450,515
Distribution in specie and cash			—				—				—				—				(2,515,109	)			(2,515,109	)
Foreign currency translation			—				—				—				138,058				—				138,058
BALANCE, January 1, 2022			18,000,000				8,775				91,225				(543,424	)			(75,146,850	)			(75,590,274	)
Net income			—				—				—				—				12,400,516				12,400,516
Foreign currency translation			—				—				—				2,514,162				—				2,514,162
BALANCE, December 31, 2022			18,000,000				8,775				91,225				1,970,738				(62,746,334	)			(60,675,596	)
Net income			—				—				—				—				4,414,733				4,414,733
Forgiveness of related party balance			—				—				55,000,000				—				—				55,000,000
Foreign currency translation			—				—				—				(1,125,947	)			—				(1,125,947	)
BALANCE, December 31, 2023			18,000,000				8,775				55,091,225				844,791				(58,331,601	)			(2,386,810	)
BALANCE, December 31, 2023 (US$)							1,125				7,053,121				108,156				(7,467,974	)			(305,572	)

 

*	Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

 

The accompanying notes are an integral part of these consolidated financial statements.

 

F-5

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2021, 2022 AND 2023

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Cash flows from operating activities
Net income			5,450,515				12,400,516				4,414,733				565,202
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation of property and equipment			136,236				11,114				33,091				4,237
Depreciation of right-of-use assets			—				—				3,260,273				417,400
Amortization of intangible assets			151,634				137,358				112,049				14,345
Inventory provision			—				—				68,536				8,774
Allowance for expected credit loss			—				—				1,383,316				177,101
Changes in operating assets and liabilities															-
Accounts receivable			(29,744,236	)			19,369,617				(23,387,722	)			(2,994,242	)
Other current assets			(589,596	)			(3,796,835	)			(14,332,426	)			(1,834,926	)
Deferred tax assets			—				—				7,876				1,008
Inventories			646,291				(619,878	)			(4,088,840	)			(523,479	)
Accounts payable			32,554,096				(74,184,359	)			(10,429,941	)			(1,335,306	)
Accruals and other payables			(76,800	)			921,015				963,089				123,301
Lease liabilities			—				—				(3,260,273	)			(417,400	)
Tax payable			1,742,282				3,001,914				(3,969,112	)			(508,150	)
Net cash from (used in) operating activities			10,270,422				(42,759,538	)			(49,225,351	)			(6,302,136	)
Cash flows from investing activities
Purchase of property and equipment			(78,190	)			(73,526	)			(1,275,847	)			(163,342	)
Cash used in investing activities			(78,190	)			(73,526	)			(1,275,847	)			(163,342	)
Cash flows from financing activities
Proceeds from bank borrowings			243,090,875				508,716,999				115,018,274				14,725,356
Repayment for bank borrowings			(220,367,256	)			(452,377,168	)			(168,602,359	)			(21,585,523	)
Distribution in cash			(266,559	)			—				—				—
Advance to related parties			(31,642,544	)			(6,341,947	)			—				—
Repayment from related parties			—				—				16,272,733				2,083,336
Advance from related parties			—				—				84,857,958				10,864,044
Net cash (used in) from financing activities			(9,185,484	)			49,997,884				47,546,606				6,087,213
Net increase (decrease) in cash and cash equivalents			1,006,748				7,164,820				(2,954,592	)			(378,265	)
Cash and cash equivalents at the beginning of the year			421,495				1,428,243				8,593,063				1,100,137
Cash and cash equivalents at the end of the year			1,428,243				8,593,063				5,638,471				721,872
Supplementary cash flow information
Interest received			1				1				92,951				11,900
Interest paid			(2,889,864	)			(6,102,137	)			(6,134,748	)			(785,409	)
Tax paid			—				(21,996	)			(3,314,625	)			(424,359	)
Non-cash investing and financing activities: Supplemental schedule of non-cash investing and financing activities:
Operating lease right-of-use assets obtained in exchange for operating lease liabilities			—				1,406,891				23,153,141				2,964,209
Distribution in specie			(2,248,550	)			—				—				—

 

The accompanying notes are an integral part of these consolidated financial statements.

 

F-6

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

1. organization and principal activities

 

Business

 

Neo-Concept International Group Holdings Limited (“We”, “us”, “Our”, “our Company”, the “Company” or “NCI”), through its wholly-owned subsidiaries is engaged in one-stop apparel solution services, offering a full suite of services in the apparel supply chain, including market trend analysis, product design and development, raw material sourcing, production and quality control, and logistics management serving the European, and North American markets. In addition, we sell apparel products in the United Kingdom (“UK”) under the licensed brand “les 100 ciels” through our retail stores since 2000. NCI and its subsidiaries are thereafter referred as the “Group” hereafter.

 

Organization and reorganization

 

NCI, incorporated in July 2021 under the laws of the Cayman Islands, is the holding company of our Group.

 

Neo-Concept Apparel Group Limited (“NCA”), a British Virgin Islands (“BVI”) business company limited by shares incorporated in August 2008, is the immediate holding company of Neo-Concept International Company Limited (“Neo-Concept HK”). The equity interest of NCA was ultimately held as to 94% by Ms. Eva Yuk Yin Siu (our “Controlling Shareholder”, or “Ms. Siu”) and 6% by Ms. Man Chi Wai (“Ms. Wai”) through certain intermediate holding companies prior to the Group Reorganization (see below).

 

Neo-Concept HK, a company incorporated in Hong Kong with limited liability in October 1992, is the immediate holding company of Neo-Concept (UK) Limited, and is our operating subsidiary in Hong Kong.

 

Neo-Concept (UK) Limited (“Neo-Concept UK”), a company incorporated in the UK with limited liability in August 2000, is a direct wholly owned subsidiary of Neo-Concept HK, and is our operating subsidiary in the UK.

 

Neo-Concept (NY) Corporation (“Neo-Concept NY”), a company incorporated in the United States of America (“USA”) with limited liability in June 2, 1999, was a direct wholly owned subsidiary of Neo-Concept HK, and was disposed of via distribution in December 2021.

 

Pursuant to a group reorganization (the “Group Reorganization”) to rationalize the structure of the Company and its subsidiary companies in preparation for the listing of our shares, the Company became the holding company of the Group on October 29, 2021, which involved the transfer of 100 shares of NCA (representing 100% of the issued shares of NCA) by Ms. Siu and Ms. Wai to the Company in exchange for 100 shares of Neo-Concept (BVI) Limited (“NC (BVI)”) (representing 100% of the issued shares of NC (BVI)), a then 100% held subsidiary of the Company, to be transferred to Splendid Vibe Limited, a company incorporated in BVI and was held as to 94% by Ms. Siu and 6% by Ms. Wai ultimately. The Company, together with its wholly owned subsidiaries, are effectively controlled by the same shareholders, i.e., ultimately held as to 94% by Ms. Siu and 6% by Ms. Wai, before and after the Group Reorganization and therefore the Group Reorganization is considered as a recapitalization of entities under common control. The consolidation of the Company and its subsidiaries has been accounted for at historical cost. No amount is recognized in respect of goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination. The consolidated statements of income and comprehensive income, consolidated statements of changes of shareholders’ deficit and consolidated statements of cash flows are prepared as if the current Group structure had been in existence throughout the year ended December 31, 2020 and the period before the Group Reorganization had taken place, or since the respective dates of incorporation/establishment of the relevant entity, where this is a shorter period.

 

Upon the Group Reorganization and as at the date of this report, details of the subsidiary companies are as follows:

 

Name		Background		Ownership
Neo-Concept Apparel Group Limited		●   A BVI company   ●   Incorporated in August 2008   ●   Issued Share Capital of US$100   ●   Intermediate holding company		100% owned by NCI

 

F-7

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

1. organization and principal activities (cont.)

 

Name		Background		Ownership
Neo-Concept International Company Limited		●   A Hong Kong company   ●   Incorporated in October 1992   ●   Issued Share Capital of HKD 100,000   ●   Provision of one-stop apparel solution services		100% owned by NCA
Neo-Concept (UK) Limited		●   A UK company   ●   Incorporated in August 2000   ●   Issued Share Capital of GBP100   ●   Provision of online and offline retail sales of apparel products		100% owned by Neo-Concept HK

 

2. Summary of Significant Accounting Policies

 

Basis of presentation

 

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for information pursuant to the rules and regulations of the Securities and Exchange Commission.

 

Principles of consolidation

 

The consolidated financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

 

Merger accounting for business combinations involving entities under common control

 

The consolidated financial statements incorporate the financial statements items of the combining entities or businesses in which the common control combination occurs as if they had been combined from the date when the combining entities or businesses first came under the control of the controlling parties.

 

The net assets of the combining entities or businesses are combined using the existing book values from the controlling parties’ perspective. No amount is recognized in respect of goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination, to the extent of the continuation of the controlling parties’ interest.

 

The combined statement of comprehensive income includes the results of each of the combining entities or businesses from the earliest date of presented or since the date when the combining entities or businesses first came under the common control, where this is a shorter period, regardless of the date of the common control combination.

 

F-8

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

Use of estimates and assumptions

 

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property and equipment, valuation allowance for deferred tax assets, fair value of financial instruments and contingencies. Actual results could vary from the estimates and assumptions that were used.

 

Functional currency and foreign currency translation

 

We use Hong Kong dollars (“HKD”) as our reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands and BVI is the United States dollar (“US$”) and the functional currency of the functional currency of its Hong Kong subsidiary is the Hong Kong dollar (“HKD”), and its UK subsidiary is the Pound Sterling (“GBP”). The determination of the respective functional currency is based on the criteria of Accounting Standards Codification (“ASC”) 830, Foreign Currency Matters.

 

Transactions denominated in currencies other than functional currency are translated into functional currency at the exchange rates quoted by authoritative banks prevailing at the dates of the transactions. Exchange gains and losses resulting from those foreign currency transactions denominated in a currency other than the functional currency are recorded as other income (expense), net in the consolidated statements of comprehensive income.

 

The financial statements of the Group are translated from the functional currency into HKD. Assets and liabilities are translated at the exchange rates at the balance sheet date. Equity accounts other than earnings generated in the current period are translated into HKD using the appropriate historical rates. Revenues and expenses, gains and losses are translated into HKD using the periodic average exchange rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income (expense) in the consolidated statements of comprehensive income.

 

Convenience translation

 

Translations of amounts in the consolidated balance sheet, consolidated statements of income and consolidated statements of cash flows from HKD into US$ as of and for the year ended December 31, 2023, are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.8109, as published in H.10 statistical release of the United States Federal Reserve Board. No representation is made that the HKD amounts could have been, or could be, converted, realized, or settled into US$ at such rate or at any other rate.

 

F-9

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

Cash and cash equivalents

 

We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

 

Accounts receivable and allowance for expected credit losses

 

Accounts receivable, net are stated at the original amount less an allowance for expected credit loss on such receivables. The allowance for expected credit losses is estimated based upon our assessment of various factors including historical experience, the age of the accounts receivable balances, current general economic conditions, future expectations and customer specific quantitative and qualitative factors that may affect our customers’ ability to pay. An allowance is also made when there is objective evidence for us to reasonably estimate the amount of probable loss. The Company regularly reviews the adequacy and appropriateness of the allowance for doubtful accounts. The receivables are written off after all collection efforts have ceased.

 

Other non-current assets, net

 

Other current assets are rental deposits.

 

Other current assets, net

 

Other current assets, net primarily include deferred IPO costs, prepayments and others.

 

Inventories, net

 

Inventories, representing finished goods for sale, are stated at the lower of cost or net realizable value, using the weighted average method. We evaluate the need for impairment associated with obsolete, slow-moving, and non-saleable inventory by reviewing net realizable value on a periodic basis but at least annually. Only defective products are eligible for returning to our materials suppliers.

 

Property and equipment, net

 

Property and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation are relieved of the applicable amounts. Gains or losses from retirements or sale are credited or charged to operations.

 

We depreciate property and equipment using the straight-line method as follows:

 

Leasehold improvement		Over the shorter of the terms of leases or 5 years when the renewal of leases is unconditional
Furniture, fixtures, and office equipment		6 years to 7 years

 

Intangible assets, net

 

Intangible assets are primarily purchased from third parties. Purchased intangible assets are initially recognized and measured at cost upon acquisition. Intangible assets that have determinable lives are amortized over their estimated useful lives based upon the usage of the asset, which is approximated using a straight-line method as follows:

 

Computer software – Point-of-sale system

10 years

 

F-10

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

Impairment for long-lived assets

 

Long-lived assets, representing property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assess the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2022 and 2023, no impairment of long-lived assets was recognized.

 

Fair value measurement

 

The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by us.

 

The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow:

 

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

 

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

 

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

 

Accounts payable

 

Accounts payable represents trade payables to vendors.

 

Accruals and other payables

 

Accruals and other payables primarily include payroll payable, interest payable, VAT and other accrual and payables.

 

Leases

 

Before January 1, 2020, we applied ASC Topic 840 (“ASC 840”), “Leases”, and each lease is classified at the inception date as either a capital lease or an operating lease.

 

We adopted ASC 842, “Leases” (“ASC 842”) on January 1, 2020, using the modified retrospective transition method through a cumulative-effect adjustment in the period of adoption rather than retrospectively adjusting prior periods and the package of practical expedient. We categorized leases with contractual terms longer than twelve months as either operating or finance lease. The adoption of ASC 842 resulted in recognition of Operating Right-of-use (“ROU”) assets of HKD 541,625 and operating lease liabilities of and HKD 541,625 as of January 1, 2020. There is no impact to accumulated deficit at adoption.

 

ROU assets represent our rights to use underlying assets for the lease terms and lease liabilities represent our obligation to make lease payments arising from the leases. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term, reduced by lease incentives received, plus any initial direct costs, using the discount rate for the lease at the commencement date. If the implicit rate in lease is not readily determinable for our operating leases, we generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We elected not to separate non-lease components from lease components; therefore, it will account for lease component and the non-lease components as a single lease component when there is only one vendor in the lease contract for the office leases. Lease payments are fixed.

 

F-11

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

For operating leases, lease expense is recognized on a straight-line basis in operations over the lease term.

 

Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities on the consolidated balance sheets.

 

Lease payments that depend on the future use of the leased property, such as sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety in accordance with ASC 840-10-25-5. Accordingly, these contingent rentals are excluded from the ROU assets and lease liabilities on the consolidated balance sheets. Lease payments of the Group’s retail stores located in the UK are charged based on the sales volume during the lease terms and therefore they are excluded from the recognition of ROU assets and lease liabilities on the consolidated balance sheets.

 

Bank borrowings

 

Borrowings are initially recognized at fair value, net of upfront fees incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method.

 

Employee benefit plan

 

Payments to the Mandatory Provident Fund Scheme under the Hong Kong Mandatory Provident Fund Schemes Ordinance and state-managed retirement benefit schemes in other jurisdictions are recognized as an expense when employees have rendered service entitling them to the contributions.

 

Related parties

 

We adopted ASC 850, “Related Party Disclosures”, for the identification of related parties and disclosure of related party transactions.

 

The details of related party transaction during the year ended December 31, 2021, 2022 and 2023, and balances as at December 31, 2022 and 2023 are set out in note 12.

 

Revenue recognition

 

We adopted ASC Topic 606, “Revenue from Contracts with Customers”, and all subsequent ASUs that modified ASC 606 on April 1, 2017, using the full retrospective method which requires us to present the financial statements for all periods as if Topic 606 had been applied to all prior periods. We derive revenue principally from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores. Revenue from contracts with customers is recognized using the following five steps:

 

1.

Identify the contract(s) with a customer;

 

2.

Identify the performance obligations in the contract;

 

3.

Determine the transaction price;

 

4.

Allocate the transaction price to the performance obligations in the contract; and

 

5.

Recognize revenue when (or as) the entity satisfies a performance obligation.

 

F-12

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services.

 

The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until we identify a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. We have addressed whether various goods and services promised to the customer represent distinct performance obligations. We applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations.

 

Our revenues from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores and digital channels are recognized at a point in time.

 

The transaction price is allocated to each performance obligation in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual standalone selling price of a good or service that has not previously been sold on a stand-alone basis, is determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with observable stand-alone selling price.

 

Transaction price is the amount of consideration in the contract to which we expect to be entitled in exchange for transferring the promised goods or services. The transaction price is fixed and is adjusted for time value of money if the contract includes a significant financing component. Consideration payable to a customer is deducted from the transaction price if we do not receive a separate identifiable benefit from the customer. Revenue is recognized at a point in time. Typically, performance obligation for products where the process is described as below, the performance obligation is satisfied at point in time.

 

The Company currently generates its revenue from the following main sources:

 

Sale of private-labelled apparel products-customized original design manufacturer

 

We currently generate our revenue from the sale of private-labelled apparel products. We are an original design manufacturer. We offer customized design and manufacturing services to customers. We typically receive purchase orders from our customers who operate retail stores, which will set forth the terms and conditions including the transaction price, products to be delivered, terms of delivery, and terms of payment. The terms serve as the basis of the performance obligations that we must fulfil in order to recognize revenue. There is only one performance obligation as a series of services of this revenue stream are interrelated and are not separable or distinct as our customers cannot benefit from the standalone task (i.e. customers do not obtain any benefits other than the finished products). The key performance obligation is the delivery of the finished product to the customer at their specified location at which point title to that asset passes to the customer. The completion of this earning process is evidenced by a written customer acceptance indicating receipt of the product. Typical payment terms set forth in the purchase order ranges from 30 to 90 days from invoice date.

 

The transaction price does not include variable consideration provision for right of return as we do not have sales return policy and no sales return is offered. No right of return is included in the revenue of the Company.

 

F-13

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

Retail sale of own-branded apparel products - “les 100 ciels”

 

We currently generate our revenue from the sale of own-branded apparel products through our physical and digital channels. Retail revenue at a point of sale is measured at the fair value of the consideration received at the time the sale is made to the customer, net of discounts. Customers settle the consideration by cash or credit cards. For online sales, we have elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. Accordingly, we recognize revenue for our single performance obligation related to online sales at the time control of the merchandise passes to the customer, which is generally at the time of shipment.

 

The transaction price includes variable consideration provision for right of return as we have sales return policy. We record an allowance for estimated merchandise returns based on our historical return patterns and various other assumptions that management believes to be reasonable. For the years ended December 31, 2021, 2022 and 2023, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers.

 

Following the adoption of ASC 606, we considered the guidance set forth in ASC 340-40, and determined that an asset would be recognized from costs incurred to fulfill a contract under ASC 340-40-25-5 only if those costs meet all of the following criteria:

 

●

The costs relate directly to a contract or an anticipated contract that the entity can specifically identify (for example, costs relating to services to be provided under the renewal of an existing contract or costs of designing an asset to be transferred under a specific contract that has not yet been approved).

 

●

The costs generate or enhance resources of the entity that will be used in satisfying (or continuing to satisfy) performance obligations in the future.

 

●

The costs are expected to be recovered.

 

The Company elected to apply the practical expedient to recognize the incremental costs of obtaining a contract as an expense if the amortization period of the asset would have been one year or less.

 

Costs that relate directly to a contract include cost of purchasing of private-labelled and own-branded apparel products from suppliers.

 

We elected to treat shipping and handling costs undertaken by the Company after the customer has obtained control of the related goods as a fulfillment activity and present as transportation costs in selling and marketing expenses.

 

Costs associated with the production of advertising, such as writing, printing, and other costs, are expensed as incurred. Costs associated with communicating advertising that has been produced, such as magazine costs, are expensed when the advertising event takes place.

 

Cost of revenues

 

Cost of revenues of private-labelled apparel products and cost of revenues of own-branded apparel products in our retail stores, which are directly related to revenue-generating transactions, primarily consist of cost of purchasing of private-labelled and own-branded apparel products from suppliers, and inbound shipping and handling cost.

 

Selling and marketing expenses

 

Selling and marketing expenses consist primarily of transportation and distribution expenses and marketing and displaying expenses.

 

F-14

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies and Practices (cont.)

 

General and administrative expenses

 

General and administrative expenses primarily consist of personnel-related compensation expenses, including salaries and related social insurance costs for our operations and supporting personnel, office rental and office expenses, insurance, amortization of intangible assets, write-down of inventories, allowance for doubtful debts, depreciation, professional services fees, and other expenses related to general operations.

 

Shipping and handling costs

 

Shipping and handling costs are expensed as incurred. Inbound shipping and handling costs associated with bringing the products from suppliers to the Company’s retail stores are included in cost of revenues. Outbound shipping and handling costs associated with shipping and delivery the products to customers are included in selling and marketing expenses.

 

Government grants

 

Government grants are recognized as income in other income or as a reduction of specific costs and expenses for which the grants are intended to compensate. Such amounts are recognized in the consolidated statements of comprehensive income upon receipt and when all conditions attached to the grants, such as companies are required to stay in the same level of employment, are fulfilled.

 

Income taxes

 

We account for income taxes pursuant to ASC Topic 740, “Income Taxes”. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain.

 

We adopted ASC Topic 740-10-05, “Income Tax”, which provides guidance for recognizing and measuring uncertain tax positions, it prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the consolidated financial statements. It also provides accounting guidance on derecognizing, classification, and disclosure of these uncertain tax positions.

 

Our policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expenses.

 

F-15

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

Value added tax (“VAT”)

 

Our subsidiary in UK is subject to VAT and related surcharges on revenue generated from sale of products. The Group records revenue net of VAT. Entities that are VAT general taxpayers are allowed to offset qualified input VAT, paid to suppliers against their output VAT liabilities. The primary applicable rate of the United Kingdom VAT is 20% for the years ended December 31, 2021, 2022 and 2023.

 

Comprehensive income 

 

We present comprehensive income in accordance with ASC Topic 220, “Comprehensive Income”. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments.

 

Commitments and contingencies

 

In the normal course of business, we are subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. We recognize a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. We may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

 

Earnings per share

 

We compute earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options, and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. For the years ended December 31, 2021, 2022 and 2023, there were no dilutive shares.

 

Recently issued accounting pronouncements

 

In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures. The purpose of the update was to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all periods presented in the consolidated financial statements. Management is evaluating the impact on the Company’s consolidated financial statements.

 

F-16

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

2. Summary of Significant Accounting Policies (cont.)

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its consolidated financial statements and disclosures.

 

Except as mentioned above, we do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

 

3. Segment information

 

ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in consolidated financial statements for details on the Company’s business segments. The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. Management, including the chief operating decision maker, reviews operation results by the revenue of different products or services. Based on management’s assessment, the Company has determined that it has only one operating segment.

 

4. INVENTORIES, NET

 

Inventories, net are comprised of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Own-branded apparel products			1,299,895				5,388,735				689,899
Less: inventory provision			—				(68,536	)			(8,774	)
Total			1,299,895				5,320,199				681,125

 

Inventory write-down expense was nil, nil and HKD 68,536 (US$8,774) for the years ended December 31, 2021, 2022, and 2023, respectively.

 

F-17

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

5. ACCOUNTS RECEIVABLE, NET

 

Accounts receivable, net is comprised of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Accounts receivable – excluding due from factor			6,114,794				33,758,410				4,321,962
Accounts receivable – due from factor			4,255,894				—				—
Allowance for expected credit losses			(31,502	)			(1,414,818	)			(181,134	)
Total			10,339,186				32,343,592				4,140,828

 

Allowance for expected credit losses, net consists of the following:

 

		2022				2023				2023
		HKD				HKD				US$
Beginning balance, January 1			31,502				31,502				4,033
Addition			—				1,383,316				177,101
Ending balance, December 31			31,502				1,414,818				181,134

 

6. OTHER CURRENT ASSETS, NET

 

Other current assets, net consist of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Deferred IPO costs			4,229,639				8,148,021				1,043,160
Prepayments			129,229				12,021,838				1,539,110
Others			21,996				55,863				7,155
Total			4,380,864				20,225,722				2,589,425

 

F-18

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

7. PROPERTY AND EQUIPMENT, NET

 

Property and equipment, net consist of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Furniture, fixtures, and office equipment			556,991				603,082				77,210
Leasehold improvement			—				2,169,258				277,722
Total			556,991				2,772,340				354,932
Less: accumulated depreciation			(502,065	)			(1,474,658	)			(188,795	)
Property and equipment, net			54,926				1,297,682				166,137

 

Depreciation expenses recognized for the years ended December 31, 2021, 2022 and 2023 were HKD 136,236, HKD 11,114 and HKD 33,091 (approximately US$4,237), respectively.

 

8. INTANGIBLE ASSETS, NET

 

Intangible assets, net consist of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Software			1,277,753				1,277,753				163,586
Less: accumulated amortization			(1,165,704	)			(1,277,753	)			(163,586	)
Intangible assets, net			112,049				—				—

 

Amortization recognized for the years ended December 31, 2021, 2022, and 2023 were HKD 151,634, HKD 137,358 and HKD 112,049 (approximately US$14,345), respectively.

 

9. ACCRUALS AND OTHER PAYABLES

 

Accruals and other payables consist of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Payroll payable			734,454				2,185,617				279,816
Interest payable			412,442				46,397				5,940
VAT			905,214				834,902				106,889
Others			190,505				138,789				17,768
Total			2,242,615				3,205,705				410,413

 

10. BANK BORROWINGS

 

Outstanding balances of bank borrowings as of December 31, 2022, and 2023 consisted of the following:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Bank borrowings:
Guaranteed			375,059				—				—
Collateralized and guaranteed			83,962,426				30,753,400				3,937,242
			84,337,485				30,753,400				3,937,242
Less: current maturities			(83,962,426	)			(30,753,400	)			(3,937,242	)
Non-current maturities			375,059				—				—

 

F-19

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

10. BANK BORROWINGS (cont.)

 

Bank borrowings as of December 31, 2022 and 2023 are as follows:

 

				Maturity				Interest		Interest		As of December 31,
Lender		Type		date		Currency		rate as of December 31, 2022		rate as December 31, 2023		2022				2023				2023
												HKD				HKD				US$
DBS Bank (Hong Kong) Limited (i)		Trading finance		Within 1 year		HKD		Bank prevailing rates		Bank prevailing rates			17,232,296				5,884,863				753,417
The Hongkong and Shanghai Banking Corporation Limited (i)		Trading finance		Within 1 year		HKD		Bank prevailing rates		Bank prevailing rates			44,500,679				21,568,885				2,761,383
Dah Sing Bank, Limited (i)		Overdraft		Within 1 year		HKD		Bank prevailing rates		Bank prevailing rates			22,229,451				—				—
Citibank, N.A., Hong Kong Branch (ii)		Trading finance		Within 1 year		HKD		Bank prevailing rates		Bank prevailing rates			—				3,299,652				422,442
HSBC UK Bank plc (iii)		Term loan		June 15, 2026		GBP		2.5%		—			375,059				—				—
Total													84,337,485				30,753,400				3,937,242
Less: current maturities													(83,962,426	)			(30,753,400	)			(3,937,242	)
Non-current maturities													375,059				—				—

 

 

(i)

In connection with our operations in Hong Kong, Neo-Concept HK, together with a related company, Neo-Concept (Holdings) Company Limited (“NCH”), a company incorporated in Hong Kong and controlled by Ms. Siu, entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH combinedly. The banking facilities were secured, details of which are set out as follows:

 

(a)

Unlimited personal guarantee by Ms. Siu;

 

(b)

Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH;

 

(c)

Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces;

 

(d)

Legal charge over certain deposits accounts held by NCH at the relevant banks;

 

F-20

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

10. BANK BORROWINGS (cont.)

 

(e)

Legal charge over certain investment funds held by NCH at the relevant banks;

 

(f)

Assignment of benefit from life insurances premium assets held by NCH at the relevant banks;

 

(g)

Assignment of benefit from life insurances premium assets held by Pure Diamond Limited, a related company in which Ms. Siu has interests, at a relevant bank;

 

(h)

Indemnity granted by NCH to relevant banks;

 

(i)

Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and

 

(j)

Cross-corporate guaranteed by Neo-Concept HK and NCH;

 

(ii)	The banking facilities were secured, details of which are set out as follows:

 

(a)

Personal guarantee by Ms. Siu and an immediate family member of Ms. Siu;

 

	(b)	Cross-corporate guaranteed by Neo-Concept HK, Neo-Concept (BVI) Limited, a company controlled by Ms. Siu, and NCH; and
	(c)	Legal charge over certain deposits accounts held by NCH at the relevant banks;

 

(iii)

The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.

 

Loan type in terms of currency		Carrying value				Carrying value				Within 1 year				2024				2025				2026				2027
		HKD				US$				HKD				HKD				HKD				HKD				HKD
in HKD			83,962,426				10,749,392				83,962,426				—				—				—				—
in GBP			375,059				48,017				—				—				—				375,059				—
December 31, 2022			84,337,485				10,797,409				83,962,426				—				—				375,059				—

 

Loan type in terms of currency		Carrying value				Carrying value				Within 1 year				2025				2026				2027				2028
		HKD				US$				HKD				HKD				HKD				HKD				HKD
in HKD			30,753,400				3,937,242				30,753,400				—				—				—				—
in GBP			—				—				—				—				—				—				—
December 31, 2023			30,753,400				3,937,242				30,753,400				—				—				—				—

 

 

F-21

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

11. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES

 

Our operating leases primarily consist of leases of office premises and showrooms. The recognition of whether a contract arrangement contains a lease is made by evaluating whether the arrangement conveys the right to use an identified asset and whether we obtain substantially all the economic benefits from and has the ability to direct the use of the asset.

 

Operating lease assets and liabilities are included in the items of operating lease right-of-use assets, net, operating lease liabilities, current portion, and operating lease liabilities, non-current portion on the consolidated balance sheets.

 

We adopted ASU No. 2016-02 and related standards (collectively ASC 842, Leases), which replaced previous lease accounting guidance, on January 1, 2020, using the modified retrospective method of adoption. We elected the transition method expedient which allows entities to initially apply the requirements by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. As a result of electing this transition method, prior periods have not been restated. In addition, adoption of the new standard resulted in the recording of right-of-use assets and associated lease liabilities of approximately HKD 541,625 and HKD 541,625, respectively, as of January 1, 2020.

 

Supplemental balance sheet information related to operating leases was as follows:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Operating lease:
Operating lease right-of-use assets			653,344				23,884,854				3,057,888
Current operating lease obligation			653,344				708,829				90,750
Non-current operating lease obligation			—				23,176,025				2,967,138
Total operating lease obligation			653,344				23,884,854				3,057,888

 

Operating lease expense for the year ended December 31, 2021, 2022 and 2023 was HKD 164,482, HKD 2,580,711 and HKD 3,271,053, respectively.

 

The undiscounted future minimum lease payment schedule as follows:

 

For the years ending December 31,		HK$				US$
2024			2,014,564				257,917
2025			2,678,490				342,917
2026			2,834,708				362,917
2027			3,023,467				387,083
2028 or after			15,006,137				1,921,179
Total lease payments			25,557,366				3,272,013
Less: imputed interest			(1,672,512	)			(214,125	)
Total operating lease liabilities			23,884,854				3,057,888

 

Other supplemental information about the Company’s operating lease as of:

 

		December 31, 2023
Weighted average discount rate			7.91	%
Weighted average remaining lease term (years)			9.0

 

Our right-of-use assets and relevant lease liabilities originated from our rented premises for office premises in Hong Kong and retail shops in the UK.

 

F-22

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

12. Related party balances and transactions

 

Due from related parties consist of the following:

 

				As of December 31,
		Relationship		2022				2023				2023
				HKD				HKD				US$
Due from Ms. Siu		Controlling Shareholder			70,001				—				—
Due from NCH		Common controlled by Ms. Siu			16,202,732				—				—

 

Due to related parties consist of the following:

 

				As of December 31,
		Relationship		2022				2023				2023
				HKD				HKD				US$
Due to Ms. Siu		Controlling Shareholder			—				(59,106	)			(7,567	)
Due to NCH		Common controlled by Ms. Siu			—				(34,184,138	)			(4,376,466	)

 

The amounts due from (to) the related parties are unsecured, interest free with no specific repayment terms. The amounts due from (to) NCH were non-trade nature, representing fund advances to NCH for its operation.

 

In addition to the transactions and balances detailed elsewhere in these consolidated financial statements, we also had the following transactions with related parties:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Agency income received by Neo-Concept UK from NCH			2,904,339				2,586,019				2,662,034				340,810
Purchase of apparel products from NCH			29,522,341				103,159,420				34,213,521				4,380,228
Rental expense paid to NCH			—				720,000				720,000				92,179
Management fee paid to NCH			4,223,236				—				—				—

 

13. DISSAGREGGATED REVENUE

 

The following table shows disaggregated revenue by major product categories for the years ended December 31, 2021, 2022, and 2023, respectively:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Sale of private-labelled apparel products			237,282,262				336,306,554				156,316,352				20,012,592
Retail sale of own-branded apparel products			3,254,265				11,145,014				17,886,275				2,289,912
Total			240,536,527				347,451,568				174,202,627				22,302,504

 

F-23

 

  

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

13. DISSAGREGGATED REVENUE (cont.)

 

The following table shows disaggregated cost of revenues by major product categories for the years ended December 31, 2021, 2022, and 2023, respectively:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Sale of private-labelled apparel products			216,523,165				301,429,220				134,239,759				17,186,208
Retail sale of own-branded apparel products			1,420,257				4,187,387				4,914,557				629,193
Total			217,943,422				305,616,607				139,154,316				17,815,401

 

The following table sets forth a breakdown of our gross profit and gross profit margin for years ended December 31, 2021, 2022, and 2023:

 

		For the year ended December 31, 2023
Product category		Revenue				Cost of revenue				Gross profit				Gross profit margin
		HKD				HKD				HKD				%
Private-labelled apparel products			156,316,352				134,239,759				22,076,593				14.1	%
Own-branded apparel products			17,886,275				4,914,557				12,971,718				72.5	%
Total			174,202,627				139,154,316				35,048,311				20.1	%

 

		For the year ended December 31, 2022
Product category		Revenue				Cost of revenue				Gross profit				Gross profit margin
		HKD				HKD				HKD				%
Private-labelled apparel products			336,306,554				301,429,220				34,877,334				10.4	%
Own-branded apparel products			11,145,014				4,187,387				6,957,627				62.4	%
Total			347,451,568				305,616,607				41,834,961				12.0	%

 

		For the year ended December 31, 2021
Product category		Revenue				Cost of revenue				Gross profit				Gross profit margin
		HKD				HKD				HKD				%
Private-labelled apparel products			237,282,262				216,523,165				20,759,097				8.7	%
Own-branded apparel products			3,254,265				1,420,257				1,834,008				56.4	%
Total			240,536,527				217,943,422				22,593,105				9.4	%

 

In the following table, revenue is disaggregated by the geographical locations of customers:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Geographical locations:
The United States and Canada			235,568,451				328,293,299				132,124,783				16,915,437
The UK			3,080,163				11,145,014				17,898,073				2,291,423
Others			1,887,913				8,013,255				24,179,771				3,095,644
Total			240,536,527				347,451,568				174,202,627				22,302,504

 

F-24

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

14. OTHER INCOME

 

Other income consists of the followings:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Government subsidies		2,313,438				—				—				—
Agency income			2,904,339				2,586,019				2,662,034				340,810
Others			—				—				326				42
Total			5,217,777				2,586,019				2,662,360				340,852

 

Agency income refers to other income from NCH, which was a discretionary payment made to Neo-Concept UK for promoting NCH’s products in UK upon a pre-determined yearly sale target was achieved. There are no enforceable rights and obligations, and the amount is recorded at a point in time.

 

15. TAXES

 

Income tax

 

Cayman Islands

 

The Cayman Islands currently levy no taxes on individuals or corporations based upon profits, income, gains or appreciations and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to our Company levied by the Government of the Cayman Islands save for certain stamp duties which may be applicable, from time to time, on certain instruments.

 

BVI

 

NCA is incorporated in the BVI and is not subject to tax on income or capital gains under current BVI law. In addition, upon payments of dividends by these entities to their shareholders, no BVI withholding tax will be imposed.

 

Hong Kong

 

Neo-Concept HK is incorporated in Hong Kong and is subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD 2,000,000, and 16.5% on any part of assessable profits over HKD 2,000,000. Under Hong Kong tax law, Neo-Concept HK is exempted from income tax on its foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends.

 

Other jurisdictions

 

Taxation arising in other jurisdictions such as the UK and the USA is calculated at the rates prevailing in the relevant jurisdictions.

 

With effect from 1 April 2023, the current main rate of corporation tax in the UK is 25%.

 

Significant components of the provision for income taxes are as follows:

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Current:
Hong Kong			1,742,282				2,979,918				928,973				118,941
The UK			—				—				388,288				49,703
Deferred:
Hong Kong			—				—				7,876				1,008
Total provision for income taxes			1,742,282				2,979,918				1,325,137				169,652

 

F-25

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

15. TAXES (cont.)

 

The following table reconciles Cayman Islands statutory rates to our effective tax rate:

 

		For the years ended December 31,
		2021				2022				2023
Income tax rate in the Cayman Islands, permanent tax holiday			0				0				0
Hong Kong statutory income tax rate			16.5	%			16.5	%			16.5	%
Effect of different tax rates			(0.8	)%			(0.6	)%			2.1	%
Income not taxable			(5.3	)%			—				—
Expense not deductible			—				4.3	%			7.0	%
Temporary not recognized			14.1	%			0.3	%			0.4	%
Tax concession			(0.3	)%			(1.1	)%			(2.9	)%
Effective tax rate			24.2	%			19.4	%			23.1	%

 

Deferred tax

 

Significant components of deferred tax were as follows:

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Deferred tax assets			7,876				7,876				1,008
Transferred to consolidated statements of income			—				(7,876	)			(1,008	)
Valuation allowance			—				—				—
Net deferred tax assets			7,876				—				—

 

The Group did not recognize any valuation allowance against its deferred tax asset as management believes the Group will be able to full utilize the assets in the foreseeable future.

 

16. riskS AND UNCERTAINTIES

 

Credit risk

 

Our assets that potentially subject to a significant concentration of credit risk primarily consist of cash and accounts receivable.

 

We believe that there is no significant credit risk associated with cash in Hong Kong, which were held by reputable financial institutions in the jurisdiction where Neo-Concept HK is located. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately US$64,090) if the bank with which an individual/a company hold its eligible deposit fails. As of December 31, 2023, cash balance of HKD 913,267 (approximately US$116,922) was maintained at financial institutions in Hong Kong and approximately HKD 500,000 was insured by the Hong Kong Deposit Protection Board.

 

F-26

 

  

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

16. riskS AND UNCERTAINTIES (cont.)

 

As of December 31, 2023, HKD4,936,039 (approximately US$631,942) was deposited with financial institutions located in UK, which was substantially insured under the Financial Services Compensation Scheme. Accordingly, it is not exposed to significant credit risk.

 

We have designed credit policies with an objective to minimize their exposure to credit risk. Our accounts receivable is short term by nature and the associated risk is minimal. We conduct credit evaluations on our clients and generally do not require collateral or other security from such clients. We periodically evaluate the creditworthiness of the existing clients in determining an allowance for doubtful accounts primarily based upon the age of the receivables and factors surrounding the credit risk of specific clients.

 

We are also exposed to risk from account receivables. These assets are subjected to credit evaluations. An allowance, where applicable, would make for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

 

Customer concentration risk

 

For the year ended December 31, 2021, one customer accounted for 94.5% of our total revenue. For the year ended December 31, 2022, one customer accounted for 91.4% of our total revenue. For the year ended December 31, 2023, one customer accounted for 71.3% of our total revenue. No other customer accounts for more than 10% of our revenue for the years ended December 31, 2021, 2022 and 2023.

 

As of December 31, 2022, one customer accounted for 83.2% of the total balance of accounts receivable. As of December 31, 2023, four customers accounted for 44.7%, 21.6%, 11.0% and 10.1% of the total balance of accounts receivable. No other customer accounts for more than 10% of our accounts receivable as of December 31, 2022 and 2023.

 

Vendor concentration risk

 

For the year ended December 31, 2021, two vendors accounted for 86.5% and 13.5% of our total purchases. For the year ended December 31, 2022, two vendors accounted for 44.2% and 35.9% of our total purchases. For the year ended December 31, 2023, two vendors accounted for 69.3% and 24.6% of our total purchases. No other vendor accounts for more than 10% of our purchases for the years ended December 31, 2021, 2022 and 2023.

 

As of December 31, 2022, three vendors accounted for 44.8%, 41.6% and 13.6% of the total balance of accounts payable. No accounts payables as of December 31, 2023. No other vendor accounts for more than 10% of our accounts payable as of December 31, 2022 and 2023.

 

We focus on diversification of suppliers so as to minimize the vendor concentration risk.

 

Interest rate risk

 

Our exposure on fair value interest rate risk mainly arises from our fixed deposits with bank. We also have exposure on cash flow interest rate risk which is mainly arising from our deposits with banks and bank borrowings.

 

In respect of the exposure to cash flow interest rate risk arising from floating rate non-derivative financial instruments held by us, such as cash deposits and bank borrowings, at the end of the reporting period, we are not exposed to significant interest rate risk as the interest rates are not expected to change significantly.

 

Foreign currency risk

 

We are exposed to foreign currency risk primarily through sales that are denominated in a currency other than the functional currency of the operations to which they relate. The currencies giving rise to this risk are primarily US$. As HKD is currently pegged to US$, our exposure to foreign exchange fluctuations is minimal.

 

Market and geographic risk

 

The Company’s operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong, as well as the general state of Hong Kong’s economy may influence the Company’s business, financial condition, and results of operations.

 

F-27

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

17. Shareholders’ equity

 

Ordinary shares

 

For the sake of undertaking a public offering of the Company’s ordinary shares, the Company has performed a series of re-organizing transactions resulting in 11,250,000 shares of ordinary shares issued and outstanding that have been retroactively restated to the beginning of the first period presented. The Company only has one single class of ordinary shares that are accounted for as permanent equity.

 

On July 14, 2023, we effected a share split at a ratio of 1-to-1.6. As a result of the share split, we now have 800,000,000 authorized ordinary shares with a par value of US$0.0000625 per ordinary share and 18,000,000 ordinary shares issued and outstanding as of the date hereof.

 

18. COMMITMENTS AND CONTINGENCIES

 

Litigation

 

From time to time, we are involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, we do not believe that the ultimate outcome of any unresolved matters, individually and in the aggregate, are reasonably possible to have a material adverse effect on our financial position, results of operations or cash flows. However, litigation is subject to inherent uncertainties and our view of these matters may change in the future. We record a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review the need for any such liabilities on a regular basis.

 

19. SUBSEQUENT EVENTS

 

The Company has assessed all events from December 31, 2023, up through May 14, 2024, which is the date of these unaudited interim condensed consolidated financial statements are available to be issued, except as disclosed below, there are no other material subsequent events that require disclosure in these unaudited interim condensed consolidated financial statements.

 

On April 23, 2024, the Company announced the closing of its IPO of 2,320,000 ordinary shares, US$0.0000625 par value per share at an offering price of US$4.00 per share.

 

F-28

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 

20. PARENT ONLY FINANCIAL INFORMATION

 

The following presents condensed parent company only financial information of Neo-Concept International Group Holdings Limited.

 

Condensed balance sheets

 

		As of December 31,
		2022				2023				2023
		HKD				HKD				US$
Current assets
Amount due from the shareholder			8,775				8,775				1,125
Non-current assets
Interests in a subsidiary			780				780				100
Total assets			9,555				9,555				1,225
Liabilities and shareholders’ deficit
Current liabilities
Amounts due to a subsidiary			780				149,867				19,187
Amounts due to a related party			71,999				—				—
Total liabilities			72,779				149,867				19,187
Shareholders’ deficit
Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023; 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023			8,775				8,775				1,125
Accumulated losses			(71,999	)			(149,087	)			(19,087	)
Total shareholders’ deficit			(63,224	)			(140,312	)			(17,962	)
Total liabilities and shareholders’ deficit			9,555				9,555				1,225

  

Condensed statements of loss

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Operating expenses
General and administrative expenses			(29,999	)			(42,000	)			(77,088	)			(9,869	)
Total operating expenses			(29,999	)			(42,000	)			(77,088	)			(9,869	)
Loss before income taxes			(29,999	)			(42,000	)			(77,088	)			(9,869	)
Income taxes			—				—				—				—
Net loss			(29,999	)			(42,000	)			(77,088	)			(9,869	)

 

F-29

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 

20. PARENT ONLY FINANCIAL INFORMATION (cont.)

 

Condensed statements of cash flows

 

		For the years ended December 31,
		2021				2022				2023				2023
		HKD				HKD				HKD				US$
Cash flows from operating activities
Net loss			(29,999	)			(42,000	)			(77,088	)			(9,869	)
Changes in operating assets and liabilities			—				—				—				—
Net cash used in operating activities			(29,999	)			(42,000	)			(77,088	)			(9,869	)
Cash flows from investing activities
Cash from (used in) investing activities			—				—				—				—
Cash flows from financing activities
Amount due to a related party			29,999				42,000				77,088				9,869
Cash flows from financing activities			29,999				42,000				77,088				9,869
Net increase (decrease) in cash and cash equivalents			—				—				—				—
Cash and cash equivalents at the beginning of the year			—				—				—				—
Cash and cash equivalents at the end of the year			—				—				—				—

 

(i)

Basis of presentation

 

The Company was incorporated under the laws of the Cayman Islands as an exempted company with limited liability on July 29, 2021 and as a holding company.

 

Neo-Concept Apparel Group Limited (“NCA”), a British Virgin Island business company limited by shares, is the immediate holding company of Neo-Concept International Company Limited, which, in turn, holds the entire equity interests in Neo-Concept International Company Limited, a company incorporated in Hong Kong with limited liability, and Neo-Concept (NY) Corporation, a company incorporated in the United States of America with limited liability.

 

The equity interest of NCA was ultimately held as to 94% by Ms. Eva Yuk Yin Siu (“Ms. Siu”) and 6% by Ms. Man Chi Wai (“Ms. Wai”) through certain intermediate holding companies.

 

On October 29, 2021, the entire equity interest of NCA (representing 100 shares) was transferred to the Company by Ms. Siu and Ms. Wai in exchange for 100 shares of Neo-Concept (BVI) Limited, a then 100% held subsidiary of the Company, to Splendid Vibe Limited, a company incorporated in BVI and was held as to 94% by Ms. Siu and 6% by Ms. Wai ultimately. Accordingly, NCA became a wholly owned subsidiary of the Company.

 

F-30

 

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
 

20. PARENT ONLY FINANCIAL INFORMATION (cont.)

 

In the condensed parent-company-only financial statements, the Company’s investment in NCA is stated at cost plus equity in undistributed earnings of NCA since the date of acquisition. The Company’s share of net loss of NCA is included in condensed statements of loss and comprehensive loss using the equity method. These condensed parent-company-only financial statements should be read in connection with the consolidated financial statements and notes thereto.

 

The condensed parent-company-only financial statements are presented as if the incorporation of the Company and its acquisition of NCA had taken place at January 1, 2020 and throughout the period as at the date before the Group Reorganization.

 

(ii)

Restricted Net Assets

 

Schedule I of Rule 5-04 of Regulation S-X requires the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant’s proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party (i.e., lender, regulatory agency, foreign government, etc.).

 

The condensed parent company financial statements have to be prepared in accordance with Rule 12-04, Schedule I of Regulation S-X if the restricted net assets of the subsidiaries of Neo-Concept International Group Holdings Limited exceed 25% of the consolidated net assets of Neo-Concept International Group Holdings Limited. The abilities of the Company’s subsidiaries in Hong Kong, the United Kingdom and the United States to pay dividends are not restricted. In this connection, the restricted net assets of the subsidiaries of the Company does not exceed 25% of the consolidated net assets of the Company and accordingly the above condensed parent company only financial information of Neo-Concept International Group Holdings Limited is presented for the supplementary reference.

 

As of December 31, 2022 and 2023, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stocks or guarantees of the Company, except for those which have been separately disclosed in the consolidated financial statements, if any.

 

 

F-31

 

 

Exhibit 1.1

 

 

AMENDED AND RESTATED   MEMORANDUM   AND   ARTICLES   OF   ASSOCIATION

Neo-Concept International Group Holdings Limited   思 宏 國 際 集 團 控 股 有 限 公 司

(as adopted by a Special Resolution passed on April 19, 2024 and effective on April 23, 2024)

 

	Hong Kong Office
	Suites 4201-03 & 12
	42/F, One Island East
	Taikoo Place
	18 Westlands Road
	Quarry Bay Hong Kong
	www.verify.gov.ky File#: 379468	Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934

 

 

 

 

TABLE OF CONTENTS

 

Shares, Warrants and Modification of Rights		8
Register of Shareholders and Share Certificates		12
Lien		13
Calls on Shares		14
Transfer of Shares		16
Transmission of Shares		18
Forfeiture of Shares		18
General Meetings		20
Proceedings at General Meetings		21
Votes of Shareholders		23
Appointment of Proxy and Corporate Representative		24
Registered Office		27
Board of Directors		27
Appointment of Directors		31
Borrowing Powers		31
General Powers of the Directors		32
Chairman and other Officers		33
Proceedings of the Directors		33
Minutes and Corporate Records		36
Secretary		36
General Management and Use of the Seal		36
Authentication of Documents		39
Capitalisation of Reserves		39
Dividends and Reserves		40
Record Date		47
Annual Returns		47
Accounts		47
Auditors		49
Notices		50
Information		52
Winding Up		53
Indemnity		53
Untraceable Shareholders		54
Destruction of Documents		55

 

	www.verify.gov.ky File#: 379468	Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934

 

i

 

 

THE COMPANIES ACT (AS REVISED)

 

EXEMPTED COMPANY LIMITED BY SHARES

 

AMENDED AND RESTATED

 

MEMORANDUM OF ASSOCIATION

 

OF

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED

 

思 宏 國 際 集 團 控 股 有 限 公 司

 

(COMPANY)

 

(adopted by a Special Resolution passed on April 19, 2024 and effective on April 23, 2024)

 

1.	The name of the Company is Neo-Concept International Group Holdings Limited 思宏國際集團控股有限公司.

 

2.	The registered office will be situated at the offices of Osiris International Cayman Limited, Suite #4-210, Governors Square, 23 Lime Tree Bay Avenue, PO Box 32311, Grand Cayman KY1-1209, Cayman Islands or at such other place in the Cayman Islands as the Directors may from time to time decide.

 

3.

The objects for which the Company is established are unrestricted and except as prohibited or limited by the laws of the Cayman Islands, the Company shall have full power and authority to carry out any object and shall have and be capable of from time to time and at all times exercising any and all of the powers at any time or from time to time exercisable by a natural person or body corporate in any part of the world whether as principal, agent, contractor or otherwise.

 

4.	Without prejudice to the generality of the foregoing, the objects of the Company shall include, but without limitation, the following:

 

4.1

To carry on the business of an investment company and for that purpose to acquire and hold, either in the name of the Company or in that of any nominee, land and real estate, gold and silver bullion, shares (including shares in the Company), stocks, debentures, debenture stock, bonds, notes, obligations and securities issued or guaranteed by any company wherever incorporated or carrying on business and debentures, debenture stock, bonds, notes, obligations and securities issued or guaranteed by any government, sovereign, ruler, commissioners, public body or authority, supreme, dependent, municipal, local or otherwise in any part of the world.

 

4.2	To lend money with or without security either at interest or without and to invest money of the Company in such manner as the Directors think fit.

 

4.3	To acquire by purchase, lease, exchange, or otherwise lands, houses, buildings and other property or any interest in the same in any part of the world.

 

4.4

To carry on the business of a commodity, commodity futures and forward contracts trader and for that purpose to enter into spot, future or forward contracts for the purchase and sale of any commodity including, but without prejudice to the generality of the foregoing, any raw materials, processed materials, agricultural products, produce or livestock, gold and silver bullion, specie and precious or semi-precious stones, goods, articles, services, currencies, rights and interests which may now or in the future be bought and sold in commerce and whether such trading is effected on an organised commodity exchange or otherwise and either to take delivery of, or to sell or exchange any such commodities pursuant to any contract capable of being entered into on any such commodities exchange.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	1 of 55

 

 

 

4.5

To carry on whether as principals, agents or otherwise the business of providing and supplying goods, equipment, materials and services of whatsoever nature, and of financiers, company promoters, realtors, financial agents, land owners and dealers in or managers of companies, estates, lands, buildings, goods, materials, services, stocks, leases, annuities and securities of whatsoever type or kind.

 

4.6	To purchase or otherwise acquire and hold any rights, privileges, concessions, patents, patent rights, licences, secret processes and any real or personal property of any kind whatsoever.

 

4.7

To build, equip, furnish, outfit, repair, purchase, own, charter and lease steam, motor, sail or other vessels, ships, boats, tugs, barges, lighters or other property to be used in the business of shipping, transportation, chartering and other communication and transport operations for the use of the Company or for others, and to sell, charter, lease, mortgage, pledge or transfer the same or any interest therein to others.

 

4.8

To carry on the business of importers, exporters and merchants of goods, produce, stores and articles of all kinds both wholesale and retail, packers, customs brokers, ship agents, warehousemen, bonded or otherwise and carriers and to transact every kind of agency, factor and brokerage business or transaction which may seem to the Company directly or indirectly conducive to its interests.

 

4.9

To carry on the business of consultants in connection with all manner of services and advisers on all matters relating to companies, firms, partnerships, charities, political and non-political persons and organisations, governments, principalities, sovereign and republican states and countries and to carry on all or any of the businesses of financial, industrial, development, architectural, engineering, manufacturing, contracting, management, advertising, professional business and personal consultants and to advise upon the means and methods for extending, developing, marketing and improving all types of projects, developments, businesses or industries and all systems or processes relating to such businesses and the financing, planning, distribution, marketing and sale thereof.

 

4.10

To act as a management company in all branches of that activity and without limiting the generality of the foregoing, to act as managers of investments and hotels, estates, real property, buildings and businesses of every kind and generally to carry on business as managers, consultants or agents for or representatives of owners of property of every kind, manufacturers, funds, syndicates, persons, firms and companies for any purpose whatsoever.

 

4.11	To carry on any other trade or business which may seem to the Company capable of being carried on conveniently in connection with any business of the Company.

 

4.12	To borrow or raise money by the issue of ordinary debenture stock or on mortgage or in such other manner as the Company shall think fit.

 

4.13	To draw, make, accept, endorse, discount, execute and issue all instruments both negotiable and non- negotiable and transferable including promissory notes, bills of exchange, bills of lading, warrants, debentures and bonds.

 

4.14	To establish branches or agencies in the Cayman Islands and elsewhere and to regulate and to discontinue the same.

 

4.15	To distribute any of the property of the Company among the members of the Company in specie.

 

4.16

To acquire and take over the whole or any part of the business, property and liabilities of any person or persons, firm or company or to take or otherwise acquire and hold shares, stock, debentures or other securities of or interest in any other company carrying on any business or possessed of any property or rights.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	2 of 55

 

 

 

4.17	To grant pensions, allowances, gratuities and bonuses to employees or ex-employees of the Company or the dependents of such persons and to support, establish or subscribe to any charitable or other institutions, clubs, societies or funds or to any national or patriotic fund.

 

4.18

To lend and advance moneys or give credit to such persons and on such terms as may be thought fit and to guarantee or stand surety for the obligations of any third party whether such third party is related to the Company or otherwise and whether or not such guarantee or surety is to provide any benefits to the Company and for that purpose to mortgage or charge the Company’s undertaking, property and uncalled capital or any part thereof, on such terms and conditions as may be thought expedient in support of any such obligations binding on the Company whether contingent or otherwise.

 

4.19

To enter into partnership or into any arrangements for sharing profits, union of interests, co-operation, joint venture, reciprocal concession, amalgamation or otherwise with any person or persons or company engaged or interested or about to become engaged or interested in the carrying on or conduct of any business or enterprise from which this Company would or might derive any benefit whether direct or indirect and to lend money, guarantee the contracts of or otherwise assist any such person or company and to take subscribe for or otherwise acquire shares and securities of any such company and to sell, hold, re issue with or without guarantee or otherwise deal with the same.

 

4.20

To enter into any arrangements with any authorities, municipal or local or otherwise and to obtain from any such authority any rights, privileges or concessions which the Company may think it desirable to obtain and to carry out, exercise and comply with any such arrangements, rights, privileges or concessions.

 

4.21	To do all such things as are incidental to or which the Company may think conducive to the attainment of the above objects or any of them.

 

5.

If the Company is registered as an exempted company as defined in the Cayman Islands Companies Act (as revised), it shall have the power, subject to the provisions of the Cayman Islands Companies Act (as revised) and with the approval of a special resolution, to continue as a body incorporated under the laws of any jurisdiction outside of the Cayman Islands and to be de-registered in the Cayman Islands.

 

6.	The liability of the members of the Company is limited.

 

7.

The authorised share capital of the Company is US$50,000 consisting of 800,000,000 shares of a par value US$0.0000625 each with the power for the Company to increase or reduce the said capital and to issue any part of its capital, original or increased, with or without any preference, priority or special privilege or subject to any postponement of rights or to any conditions or restrictions; and so that, unless the condition of issue shall otherwise expressly declare, every issue of shares, whether declared to be preference or otherwise, shall be subject to the power hereinbefore contained.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	3 of 55

 

 

 

THE COMPANIES ACT (AS REVISED)

 

EXEMPTED COMPANY LIMITED BY SHARES

 

AMENDED AND RESTATED

 

ARTICLES OF ASSOCIATION

 

OF

 

NEO-CONCEPT INTERNATIONAL GROUP HOLDINGS LIMITED

 

思 宏 國 際 集 團 控 股 有 限 公 司

 

(COMPANY)

 

(adopted by a Special Resolution passed on April 19, 2024 and effective on April 23, 2024)

 

1	(a)	Table “A” of the Companies Act (as revised) shall not apply to the Company.
	(b)	Any marginal notes, titles or lead in references to Articles and the index of the Memorandum and Articles of Association shall not form part of the Memorandum or Articles of Association and shall not affect their interpretation. In interpreting these Articles of Association, unless there be something in the subject or context inconsistent therewith:		Marginal Notes
		address: shall have the ordinary meaning given to it and shall include any facsimile number, electronic number or address or website used for the purposes of any communication pursuant to these Articles;		Definitions
		appointor: means in relation to an alternate Director, the Director who appointed the alternate to act as his alternate;
		Articles: means these Articles of Association in their present form and all supplementary, amended or substituted articles for the time being in force;
		Auditors: means the independent auditor of the Company which shall be an internationally recognized firm of independent accountants;
		Audit Committee: the audit committee of the Company formed by the Board pursuant to Article 136 hereof, or any successor audit committee;
		Board: means the board of Directors of the Company as constituted from time to time or as the context may require the majority of Directors present and voting at a meeting of the Directors at which a quorum is present;
		Call: shall include any instalment of a call;
		clear days: means in relation to the period of a notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect;
		Clearing House: means a clearing house recognised by the laws of the jurisdiction in which the Shares are listed or quoted with the permission of the Company on a stock exchange in such jurisdiction;

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	4 of 55

 

 

 

		Companies Act: means the Companies Act (as revised) of the Cayman Islands as amended from time to time and every other act, order regulation or other instrument having statutory effect (as amended from time to time) for the time being in force in the Cayman Islands applying to or affecting the Company, the Memorandum of Association and/or the Articles;
		Company: means the above named company;
		Competent Regulatory Authority: means a competent regulatory authority in the territory where the shares of the Company (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such territory;
		Debenture and Debenture Holder: means and includes respectively debenture stock and debenture stockholder;
		Designated Stock Exchange: means the Nasdaq Stock Market in the United States of America and/or any other stock exchange or interdealer quotation system on which the Shares are listed or quoted;
		Designated Stock Exchange Rules: means the relevant code, rules and regulations, as amended, from time to time, applicable as a result of the original and continued listing of any Shares on the Designated Stock Exchange;
		Director: means the directors for the time being of the Company and the expression Director shall be construed accordingly;
		Dividend: means dividends, distributions in specie or in kind, capital distributions and capitalisation issues;
		dollars and $: means the lawful currency for the time being of the United States of America;
		Exchange Act: means the Securities Exchange Act of 1934, as amended;
		Head Office: means such office of the Company as the Board may from time to time determine to be the principal office of the Company;
		Month: means a calendar month;
		Ordinary Resolution: means a resolution as described in Article 1(e) of these Articles;
		Paid: means, as it relates to a Share, paid or credited as paid;
		Register: means the principal register and any branch register of Shareholders of the Company to be maintained at such place within or outside the Cayman Islands as the Board shall determine from time to time;
		Registered Office: means the registered office of the Company for the time being as required by the Companies Act;
		SEC: means the Securities and Exchange Commission of the United States of America or any other federal agency for the time being administering the Securities Act;

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	5 of 55

 

 

 

		Seal: means the common seal of the Company and any one or more facsimile seals from time to time of the Company for use in the Cayman Islands or in any place outside the Cayman Islands;
		Secretary: means the person for the time being performing the duties of that office of the Company and includes any assistant, deputy, acting or temporary secretary;
		Securities Act: means the Securities Act of 1933 of the United States of America, as amended, or any similar federal statute and the rules and regulations of the SEC thereunder, all as the same shall be in effect at the time;
		Securities Seal: shall mean a seal for use for sealing certificates for shares or other securities issued by the Company which is a facsimile of the Seal of the Company with the addition on its face of the words Securities Seal;
		Share: means a share in the share capital of the Company and includes stock except where a distinction between stock and Shares is expressed or implied;
		Shareholder: means the person who is duly registered in the Register as holder for the time being of any Share and includes persons who are jointly so registered;
		Special Resolution: means a resolution as described in Article 1(d) of these Articles;
		Statutes: means the Companies Act and every other law of the Legislature of the Cayman Islands for the time being in force applying to or affecting the Company, the memorandum of association of the Company as from time to time amended, and/or these Articles;
		Transfer Office: means the place where the principal register of Shareholders is located for the time being.

 

(c)

In these Articles, unless there be something in the subject or context inconsistent herewith:

General

 

(i)

words denoting the singular number shall include the plural number and vice versa;

 

(ii)

words importing any gender shall include every gender and words importing persons shall include partnerships, firms, companies and corporations;

 

(iii)

subject to the foregoing provisions of this Article, any words or expressions defined in the Companies Act (except any statutory modification thereof not in force when these Articles become binding on the Company) shall bear the same meaning in these Articles, save that “company” shall where the context permits include any company incorporated in the Cayman Islands or elsewhere;

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	6 of 55

 

 

 

(iv)

references to any law, ordinance, statute or statutory provision shall be construed as relating to any statutory modification or re- enactment thereof for the time being in force; and

 

(v)

save as aforesaid words and expressions defined in the Statutes shall bear the same meanings in these Articles if not inconsistent with the subject in the context.

 

	(d)	A resolution shall be a Special Resolution when it has been passed by a majority of not less than two-thirds of the votes cast by such Shareholders as, being entitled to do, vote in person or by proxy or, in the cases of Shareholders which are corporations, by their respective duly authorised representatives at a general meeting held in accordance with these Articles and of which notice specifying the intention to propose the resolution as a special resolution has been duly given.		Special Resolution
	(e)	A resolution shall be an Ordinary Resolution when it has been passed by a simple majority of the votes cast by such Shareholders as, being entitled so to do, vote in person or, by proxy or, in the cases of Shareholders which are corporations, by their respective duly authorised representatives at a general meeting held in accordance with these Articles and of which not less than ten (10) clear days’ notice has been duly given.		Ordinary Resolution
	(f)	A resolution in writing signed (in such manner as to indicate, expressly or impliedly, unconditional approval) by or on behalf of all Shareholders for the time being entitled to receive notice of and to attend and vote at general meetings of the Company shall, for the purpose of these Articles, be treated as an Ordinary Resolution duly passed at a general meeting of the Company duly convened and held and, where relevant as a Special Resolution so passed. Any such resolution shall be deemed to have been passed at a meeting held on the date on which it was signed by the last Shareholder to sign, and where the resolution states a date as being the date of his signature thereof by any Shareholder the statement shall be prima facie evidence that it was signed by him on that date. Such a resolution may consist of several documents in the like form, and signed by one or more relevant Shareholders.		Resolutions in writing
	(g)	A Special Resolution shall be effective for any purpose for which an Ordinary Resolution is expressed to be required under any provision of these Articles.		Special Resolution effective as Ordinary Resolution

 

2

To the extent that the same is permissible under Cayman Islands law and subject to Article 13, a Special Resolution shall be required to alter the Memorandum of Association of the Company, to approve any amendment of the Articles or to change the name of the Company.

When Special Resolution is required

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	7 of 55

 

 

 

SHARES, WARRANTS AND MODIFICATION OF RIGHTS

 

3

Subject to the Statutes and without prejudice to any special rights or restrictions for the time being attaching to any Shares or any class of Shares including preference Shares, any Share may be issued upon such terms and conditions and with such preferred, deferred or other qualified or special rights, or such restrictions, whether in regard to Dividend, voting, return of capital or otherwise, as the Company may from time to time by Ordinary Resolution determine (or, in the absence of any such determination or so far as the same may not make specific provision, as the Board may determine) and any Share may be issued on the terms that it is liable to be redeemed upon the happening of a specified event or upon a given date and either at the option of the Company, or at the option of the holder. Subject to the Companies Act, any preferred shares may be issued or converted into shares that, at a determinable date or at the option of the Company or the holder thereof, are to be redeemed or are liable to be redeemed on such terms and in such manner as the Board may in their absolute discretion determine. No Shares shall be issued to bearer.

Issue of Shares

 

4

The Board may issue options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities of the Company, which options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof may be issued on such terms as the Board may from time to time determine.

Options, warrants or convertible securities

 

5

(a)

Subject to the Companies Act and without prejudice to Article 11, if at any time the share capital of the Company is divided into different classes of Shares, all or any of the special rights attached to any class (unless otherwise provided for by the terms of issue of the Shares of that class) may, subject to the provisions of the Companies Act, be varied, modified or abrogated with the sanction of a Special Resolution passed at a separate general meeting of the holders of the Shares of that class. To every such separate general meeting the provisions of these Articles relating to general meetings shall mutatis mutandis apply, but so that the necessary quorum (whether at a separate general meeting or at its adjourned meeting) shall be not less than a person or persons together holding (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or representing by proxy not less than one-third (1/3) in nominal value of the issued Shares of that class, that the quorum for any meeting adjourned for want of quorum shall be two (2) Shareholders present in person (or in the case of the Shareholder being a corporation, by its duly authorised representative) or by proxy (whatever the number of Shares held by them) , that every holder of shares of the class shall be entitled on a poll to one (1) vote for every such share held by him and that any holder of Shares of the class present in person (or in the case of the Shareholder being a corporation, by its duly authorised representative) or by proxy may demand a poll.

How rights of shares may be modified

 

(b)

The provisions of this Article shall apply to the variation or abrogation of the rights attached to the Shares of any class as if each group of Shares of the class differently treated formed a separate class the rights whereof are to be varied or abrogated.

 

(c)

The special rights conferred upon the holders of any Shares or class of Shares shall not, unless otherwise expressly provided in the rights attaching to the terms of issue of such Shares be deemed to be altered by the creation or issue of further Shares ranking pari passu therewith.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	8 of 55

 

 

 

6

The authorised share capital of the Company on the date of the adoption of these Articles is US$50,000 divided into 800,000,000 shares of a par value US$0.0000625 each.

Authorised Share Capital

 

7

The Company in general meeting may from time to time, whether or not all the Shares for the time being authorised shall have been issued and whether or not all the Shares for the time being issued shall have been fully paid up, by Ordinary Resolution increase its share capital by the creation of new Shares, such new capital to be of such amount and to be divided into Shares of such class or classes and of such amounts in any currency as the Shareholders may think fit and as the resolution may prescribe.

Power to increase capital

 

8	Any new Shares shall be issued upon such terms and conditions and with such rights, privileges or restrictions attached thereto as the general meeting resolving upon the creation thereof shall direct, and if no direction be given, subject to the provisions of the Companies Act and of these Articles, as the Board shall determine; and in particular such Shares may be issued with a preferential or qualified right to participate in Dividends and in the distribution of assets of the Company and with a special right or without any right of voting.		On what conditions new shares may be issued
9	The Board may, before the issue of any new Shares, determine that the same, or any of them, shall be offered in the first instance, and either at par or at a premium, to all the existing holders of any class of Shares in proportion as nearly as may be to the number of Shares of such class held by them respectively, or make any other provisions as to the allotment and issue such Shares, but in default of any such determination or so far as the same shall not extend, such Shares may be dealt with as if they formed part of the capital of the Company existing prior to the issue of the same.		When to be offered to existing shareholders
10	Except so far as otherwise provided by the conditions of issue or by these Articles, any capital raised by the creation of new Shares shall be treated as if it formed part of the original capital of the Company and such Shares shall be subject to the provisions contained in these Articles with reference to the payment of calls and instalments, transfer and transmission, forfeiture, lien, cancellation, surrender, voting and otherwise.		New shares to form part of original capital

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	9 of 55

 

 

 

11

(a)

Subject to the Statutes and where applicable, the Designated Stock Exchange Rules and without prejudice to any special rights of restrictions for the time being attached to any shares or any class of shares, all unissued Shares and other securities of the Company (whether forming part of the original or any increased capital) shall be at the disposal of the Board and it may offer, allot (with or without conferring a right of renunciation), grant options over or otherwise dispose of them to such persons, at such times, for such consideration and generally on such terms (subject to Article 9) as it in its absolute discretion thinks fit, but so that no Shares shall be issued at a discount. The Board shall, as regards any offer or allotment of Shares, comply with the provisions of the Companies Act, if and so far as such provisions may be applicable thereto. In particular and without prejudice to the generality of the foregoing, the Board is hereby empowered to authorize by resolution or resolutions from time to time the issuance of one or more classes or series of preferred shares and to fix the designations, powers, preferences and relative, participating, optional and other rights, if any, and the qualifications, limitations and restrictions thereof, if any, including, without limitation, the number of shares constituting each such class or series, dividend rights, conversion rights, redemption privileges, voting powers, full or limited or no voting powers, and liquidation preferences, and to increase or decrease the size of any such class or series (but not below the number of shares of any class or series of preferred shares then outstanding) to the extent permitted by Companies Act. Without limiting the generality of the foregoing, the resolution or resolutions providing for the establishment of any class or series of preferred shares may, to the extent permitted by law, provide that such class or series shall be superior to, rank equally with or be junior to the preferred shares of any other class or series.

Unissued Shares at the disposal of the Directors

 

(b)

Neither the Company nor the Board shall be obliged, when making or granting any allotment of, offer of, option over or disposal of Shares or other securities of the Company, to make, or make available, and may resolve not to make, or make available, any such allotment, offer, option or Shares or other securities to Shareholders or others with registered addresses, or in any particular territory or territories being a territory or territories where, in the absence of a registration statement or other special formalities, this would or might, in the opinion of the Board, be unlawful or impracticable, or the existence or extent of the requirement for such registration statement or special formalities might be expensive (whether in absolute terms or in relation to the rights of the Shareholder(s) who may be affected) or time consuming to determine. The Board shall be entitled to make such arrangements to deal with fractional entitlements arising on an offer of any unissued Shares or other securities as it thinks fit, including the aggregation and the sale thereof for the benefit of the Company. Shareholders who may be affected as a result of any of the matters referred to in this paragraph (b) shall not be, and shall be deemed not to be, a separate class of Shareholders for any purposes whatsoever. Except as otherwise expressly provided in the resolution or resolutions providing for the establishment of any class or series of preferred shares, no vote of the holders of preferred shares of or ordinary shares shall be a prerequisite to the issuance of any shares of any class or series of the preferred shares authorized by and complying with the conditions of the Statutes.

 

12

The Company may in connection with the issue of any shares exercise all powers of paying commission and brokerage conferred or permitted by the Companies Act. Subject to the Companies Act, the commission may be satisfied by the payment of cash or by the allotment of fully or partly paid shares or partly in one and partly in the other.

Company may pay commission

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	10 of 55

 

 

 

13

The Company may from time to time by Ordinary Resolution:

Increase in capital,

 

	(a)	increase its share capital as provided by Article 7;		consolidation and division of capital and
	(b)	consolidate or divide all or any of its share capital into Shares of larger amount than its existing Shares; and on any consolidation of fully paid Shares into Shares of larger amount, the Board may settle any difficulty which may arise as it thinks expedient and in particular (but without prejudice to the generality of the foregoing) may as between the holders of Shares to be consolidated determine which particular Shares are to be consolidated into a consolidated Share, and if it shall happen that any person shall become entitled to fractions of a consolidated Share or Shares, such fractions may be sold by some person appointed by the Board for that purpose and the person so appointed may transfer the Shares so sold to the purchaser thereof and the validity of such transfer shall not be questioned, and so that the net proceeds of such sale (after deduction of the expenses of such sale) may either be distributed among the persons who would otherwise be entitled to a fraction or fractions of a consolidated Share or Shares rateably in accordance with their rights and interest or may be paid to the Company for the Company’s benefit;		subdivision, cancellation of shares and redenomination etc.

 

(c)

without prejudice to the powers of the Board under Article 11, divide its unissued Shares into several classes and attach thereto respectively any preferential, deferred, qualified or special rights, privileges, conditions or such restrictions which in the absence of any such determination by the Company in general meeting, as the Board may determine provided always that, for the avoidance of doubt, where a class of shares has been authorized by the Company no resolution of the Company in general meeting is required for the issuance of shares of that class and the Board may issue shares of that class and determine such rights, privileges, conditions or restrictions attaching thereto as aforesaid;

 

	(d)	sub-divide its Shares or any of them into Shares of smaller amount than is fixed by the Company’s Memorandum of Association, so, however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced Share shall be the same as it was in case of the share from which the reduced Share is derived;
	(e)	cancel any Shares which at the date of the passing of the resolution have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the Shares so cancelled;
	(f)	convert all or any of its paid-up shares into stock, and reconvert that stock into paid-up shares of any denomination.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	11 of 55

 

 

 

14

The Company may by Special Resolution reduce its share capital or any capital redemption reserve in any manner authorised, and subject to any conditions prescribed, by law.

Reduction of capital

 

15

(a)

Subject to the Statutes, and, where applicable, the Designated Stock Exchange Rules and/or any Competent Regulatory Authority, or any other law or so far as not prohibited by any law and subject to any rights conferred on the holders of any class of Shares, any power of the Company to purchase or otherwise acquire all or any of its own Shares (which expression as used in this Article includes redeemable Shares) be exercisable by the Board in such manner, upon such terms and subject to such conditions as it thinks fit.

Company to purchase its own shares

 

(b)

Subject to the Statutes, and to any special rights conferred on the holders of any Shares or attaching to any class of Shares, Shares may be issued on the terms that they may, at the option of the Company or the holders thereof, be liable to be redeemed on such terms and in such manner, including out of capital, as the Board may deem fit.

 

16

Except as otherwise expressly provided by these Articles or as required by law or as ordered by a court of competent jurisdiction, no person shall be recognised by the Company as holding any Share upon any trust and, except as aforesaid, the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or partial interest in any Share or any interest in any fractional part of a Share or any other right or claim to or in respect of any Shares except an absolute right to the entirety thereof of the registered holder.

 

REGISTER OF SHAREHOLDERS AND SHARE CERTIFICATES

 

17	(a)	The Board shall keep or cause to be kept the Register and there shall be entered therein the particulars required under the Companies Act.		Share Register
	(b)	Subject to the provisions of the Companies Act, if the Board considers it necessary or appropriate, the Company may establish and maintain a principal or branch register of Shareholders at such location as the Board thinks fit and in the absence of any such determination, the Register shall be kept at the Registered Office.		Local or branch register
18	(a)	Every share certificate shall be issued under the Seal or a facsimile thereof and shall specify the number and class and distinguishing numbers (if any) of the shares to which it relates, and the amount paid up thereon and may otherwise be in such form as the Directors may from time to time determine. No certificate shall be issued representing shares of more than one class. The Board may by resolution determine, either generally or in any particular case or cases, that any signatures on any such certificates (or certificates in respect of other securities) need not be autographic but may be affixed to such certificates by some mechanical means or may be printed thereon.6		Share certificates
	(b)	Every person whose name is entered, upon an allotment of shares, as a Member in the Register shall be entitled, without payment, to receive one (1) certificate for all such shares of any one (1) class or several certificates each for one (1) or more of such shares of such class upon payment for every certificate after the first of such reasonable out-of-pocket expenses as the Board from time to time determines.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	12 of 55

 

 

 

	(c)	Share certificates shall be issued within the relevant time limit as prescribed by the Companies Act or as the Designated Stock Exchange may from time to time determine, whichever is the shorter, after allotment or, except in the case of a transfer which the Company is for the time being entitled to refuse to register and does not register, after lodgment of a transfer with the Company.
	(d)	Upon every transfer of shares the certificate held by the transferor shall be given up to be cancelled, and shall forthwith be cancelled accordingly, and a new certificate shall be issued to the transferee in respect of the shares transferred to him at such fee as is provided in paragraph (e) of this Article. If any of the shares included in the certificate so given up shall be retained by the transferor a new certificate for the balance shall be issued to him at the aforesaid fee payable by the transferor to the Company in respect thereof.
	(e)	The fee referred to in paragraph (d) above shall be an amount not exceeding the relevant maximum amount as the Designated Stock Exchange may from time to time determine provided that the Board may at any time determine a lower amount for such fee.
	(f)	Every Share certificate of the Company shall bear legends required under the applicable laws, including the Securities Act.

 

19

(a)

In the case of a share held jointly by several persons, the Company shall not be bound to issue more than one (1) certificate therefor and delivery of a certificate to one of several joint holders shall be sufficient delivery to all such holders.

Joint holders

 

(b)

If any Shares shall stand in the names of two (2) or more persons, the person first named in the Register shall be deemed to be sole holder thereof as regards service of notice and, subject to the provisions of these Articles, all or any other matter connected with the Company, except the transfer of the Share.

 

20

If a share certificate is defaced, lost or destroyed, it may be replaced on payment of such fee (if any) and on such terms (if any) as to evidence and indemnity, and on the payment of expenses of the Company in investigating such evidence and preparing such indemnity as the Board shall think fit and, in case of defacement, on delivery of the old certificate to the Company for cancellation.

Replacement of share certificates

 

LIEN

 

21

The Company shall have a first and paramount lien on every Share (not being a fully paid Share) for all moneys, whether presently payable or not, called or payable at a fixed time in respect of that Share; and the Company shall also have a first and paramount lien and charge on all Shares (other than fully paid-up Shares) standing registered in the name of a Shareholder, whether singly or jointly with any other person or persons, for all the debts and liabilities of such Shareholder or his estate to the Company and whether the same shall have been incurred before or after notice to the Company of any equitable or other interest of any person other than such Shareholder, and whether the period for the payment or discharge of the same shall have actually arrived or not, and notwithstanding that the same are joint debts or liabilities of such Shareholder or his estate and any other person, whether a Shareholder of the Company or not. The Company’s lien (if any) on a Share shall extend to all Dividends and bonuses declared in respect thereof. The Board may at any time either generally or in any particular case waive any lien that has arisen, or declare any Share to be exempt wholly or partially from the provisions of this Article.

Company’s lien

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	13 of 55

 

 

 

22

The Company may sell, in such manner as the Board thinks fit, any Shares on which the Company has a lien, but no sale shall be made unless some sum in respect of which the lien exists is presently payable or the liability or engagement in respect of which such lien exists is liable to be presently fulfilled or discharged, nor until the expiration of fourteen (14) days after a notice in writing, stating and demanding payment of the sum presently payable or specifying the liability or engagement and demanding fulfilment or discharge thereof and giving notice of intention to sell in default, shall have been given, in the manner in which notices may be sent to Shareholders of the Company as provided in these Articles, to the registered holder for the time being of the Shares, or the person entitled by reason of such holder’s death, bankruptcy or winding-up to the Shares.

Sale of shares subject to lien

 

23

The net proceeds of such sale after the payment of the costs of such sale shall be applied in or towards payment or satisfaction of the debt or liability or engagement in respect whereof the lien exists, so far as the same is presently payable, and any residue shall (subject to a like lien for debts or liabilities not presently payable as existed upon the Shares prior to the sale) be paid to the person entitled to the Shares at the time of the sale. For the purpose of giving effect to any such sale, the Board may authorise some person to transfer the Shares sold to the purchaser thereof and may enter the purchaser’s name in the Register as holder of the Shares, and the purchaser shall not be bound to see the application of the purchase money, nor shall his title to the Shares be affected by any irregularity or invalidity in the proceedings relating to the sale.

Application of proceeds of sale

 

CALLS ON SHARES

 

24

Subject to these Articles and to the terms of allotment, the Board may from time to time make such calls as it thinks fit upon the Shareholders in respect of any moneys unpaid on the Shares held by them respectively (whether on account of the nominal value of the Shares or by way of premiums) and not by the conditions of allotment thereof made payable at a fixed time. A call may be made payable either in one sum or by instalments.

Calls/ instalments

 

25

At least fourteen (14) clear days’ notice of any call shall be given to the relevant Shareholders specifying the time and place of payment and to whom such call shall be paid.

Notice of call

 

26	A copy of the notice referred to in Article 25 shall be sent to relevant Shareholders in the manner in which notices may be sent to Shareholders by the Company as herein provided.		Copy of notice to be sent to shareholders
27	Every Shareholder upon whom a call is made shall pay the amount of every call so made on him to the person and at the time or times and place or places as the Board shall appoint.		Time and place for payment of call

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	14 of 55

 

 

 

28	A call shall be deemed to have been made at the time when the resolution of the Board authorising such call was passed.		When call deemed to have been made
29	The joint holders of a Share shall be severally as well as jointly liable for the payment of all calls and instalments due in respect of such Share or other moneys due in respect thereof.		Liability of joint holders
30	A call may be extended, postponed or revoked in whole or in part as the Board determines but no Shareholder shall be entitled to any such extension except as a matter of grace and favour.		Board may extend time fixed for call
31	If the sum payable in respect of any call or instalment is not paid before or on the day appointed for payment thereof, the person or persons from whom the sum is due shall pay interest on the same at such rate not exceeding 20% per annum as the Board shall fix from the day appointed for the payment thereof to the time of the actual payment, but the Board may waive payment of such interest wholly or in part.		Interest on unpaid calls
32	No Shareholder shall be entitled to receive any Dividend or bonus or to be present or vote (save as proxy or authorised representative for another Shareholder) at any general meeting, either personally, or (save as proxy or authorised representative for another Shareholder) by proxy, or be reckoned in a quorum, or to exercise any other privilege as a Shareholder until all calls or instalments due from him to the Company, whether alone or jointly or jointly and severally with any other person, together with interest and expenses (if any) shall have been paid.		Suspension of privileges while call unpaid
33	On the trial or hearing of any action or other proceedings for the recovery of any money due for any call, it shall be sufficient to prove that the name of the Shareholder sued is entered in the Register as the holder, or one of the holders, of the Shares in respect of which such debt accrues; that the resolution of the Board making the call has been duly recorded in the minute book of the Board; and that notice of such call was given to the Shareholder sued, in pursuance of these Articles, and it shall not be necessary to prove the appointment of the Directors who made such call, nor any other matters whatsoever, but the proof of the matters aforesaid shall be conclusive evidence of the debt.		Evidence in action for call

 

34	(a)	Any sum which by the terms of allotment of a Share is made payable upon allotment or at any fixed date, whether on account of the nominal value of the Share and/or by way of premium, shall for all purposes of these Articles be deemed to be a call duly made and notified and payable on the date fixed for payment, and in case of non-payment all the relevant provisions of these Articles as to payment of interest and expenses, forfeiture and the like, shall apply as if such sums had become payable by virtue of a call duly made and notified.		Sums payable on allotment deemed a call
	(b)	Subject to the terms of allotment, the Board may on the issue of Shares differentiate between the allottees or holders as to the amount of calls to be paid and the time of payment.		Shares may be issued subject to different conditions as to calls, etc.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	15 of 55

 

 

 

35

The Board may, if it thinks fit, receive from any Shareholder willing to advance the same, and either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any Shares held by him, and in respect of all or any of the moneys so advanced may pay interest at such rate (if any) not exceeding 20% per annum, as the Board may decide but a payment in advance of a call shall not entitle the Shareholder to receive any Dividend subsequently declared or to exercise any other rights or privileges as a Shareholder in respect of the Share or the due portion of the Shares upon which payment has been advanced by such Shareholder before it is called up. The Board may at any time repay the amount so advanced upon giving to such Shareholder not less than one (1) Month’s notice in writing of its intention on that behalf, unless before the expiration of such notice the amount so advanced shall have been called up on the Shares in respect of which it was advanced.

 

TRANSFER OF SHARES

 

36	Subject to the Statutes, all transfers of Shares shall be effected by transfer in writing in the usual or common form or in such other form as the Board may accept provided always that it shall be in such a form prescribed by the Designated Stock Exchange and may be under hand only or, if the transferor or transferee is a Clearing House (or its nominee(s)) or a central depository house (or its nominee(s)), under hand or by machine imprinted signature or by such other means of execution as the Board may approve from time to time.		Form of transfer
37	The instrument of transfer of any Share shall be executed by or on behalf of the transferor and by or on behalf of the transferee provided that the Board may dispense with the execution of the instrument of transfer by the transferor or the transferee or accept mechanically executed transfers in any case in which it in its absolute discretion thinks fit to do so. The transferor shall be deemed to remain the holder of the Share until the name of the transferee is entered in the Register in respect thereof. Nothing in these Articles shall preclude the Board from recognising a renunciation of the allotment or provisional allotment of any Share by the allottee in favour of some other person.		Execution of transfer

 

38

(a)

The Board may, in its absolute discretion at any time and from time to time, remove any Share on the principal Register to any branch Register or any Share on any branch Register to the principal Register or any other branch Register.

Shares registered on principal register, branch register, etc.

 

(b)

Unless the Board otherwise agrees (which agreement may be on such terms and subject to such conditions as the Board in its absolute discretion may from time to time stipulate, and which agreement it shall, without giving any reason therefore, be entitled in its absolute discretion to give or withhold) no Shares on the principal Register shall be removed to any branch Register nor shall Shares on any branch Register be removed to the principal Register or any other branch Register and all removals and other documents of title relating to or affecting the title to any share or other securities of the Company shall be lodged for registration, and be registered, in the case of any Shares on a branch Register, at the Registered Office, and, in the case of any Shares on the principal Register, at the Transfer Office.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	16 of 55

 

 

 

(c)

Notwithstanding anything contained in these Articles, the Company shall as soon as practicable and on a regular basis record in the principal Register all removals of Shares effected on any branch Register and shall at all times maintain the principal Register and all branch Registers in all respects in accordance with the Companies Act.

 

39	Fully paid Shares shall be free from any restriction with respect to the right of the holder thereof to transfer such Shares (except when permitted by the Designated Stock Exchange) and shall also be free from all liens. The Board however, may, in its absolute discretion, refuse to register a transfer of any Share which is not fully paid to a person of whom it does not approve or any Share issued under any share option scheme upon which a restriction on transfer imposed thereby still subsists, and it may also refuse to register a transfer of any Share (whether fully paid up or not) to more than four (4) joint holders or a transfer of any Shares (not being a fully paid up Share) on which the Company has a lien.		Directors may refuse to register a transfer
40	The Board may also decline to recognise any instrument of transfer unless:

 

(a)

a fee of such maximum as the Designated Stock Exchange may from time to time determine to be payable (or such lesser sum as the Board may from time to time require) has been paid to the Company;

Requirement as to transfer

 

	(b)	the instrument of transfer is lodged at the Registered Office or, as the case may be, the Transfer Office accompanied by the certificate of the Shares to which it relates, and such other evidence as the Board may reasonably require to show the right of the transferor to make the transfer (and, if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do);
	(c)	the instrument of transfer is in respect of only one class of Share;
	(d)	the Shares concerned are free of any lien in favour of the Company; and
	(e)	if applicable, the instrument of transfer is properly stamped.

 

41	If the Board shall refuse to register a transfer of any Share, it shall, within two (2) months after the date on which the transfer was lodged with the Company, send to each of the transferor and the transferee notice of such refusal and, except where the subject Share is not a fully paid Share, the reason(s) for such refusal.		Notice of refusal
42	Upon every transfer of Shares, the certificate in respect thereof held by the transferor shall be given up to be cancelled, and shall forthwith be cancelled accordingly, and a new certificate shall be issued to the transferee in respect of the Shares transferred to him as provided in Article 18, and if any of the Shares included in the certificate so given up shall be retained by the transferor a new certificate in respect thereof shall be issued to him as provided in Article 18. The Company shall retain the instrument of transfer.		Certificate to be given up on transfer
43	The registration of transfers of shares or of any class of shares may, after compliance with any notice requirement of the Designated Stock Exchange, be suspended at such times and for such periods (not exceeding in the whole thirty (30) days in any year) as the Board may determine.		When transfer books or register is closed

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	17 of 55

 

 

 

TRANSMISSION OF SHARES

 

44	In the case of the death of a Shareholder, the survivor or survivors where the deceased was a joint holder, and the legal personal representatives of the deceased where he was a sole or only surviving holder, shall be the only persons recognised by the Company as having any title to his interest in the Shares; but nothing herein contained shall release the estate of a deceased holder (whether sole or joint) from any liability in respect of any Share solely or jointly held by him.		Deaths of registered holder or of joint holder of shares
45	Any person becoming entitled to a Share in consequence of the death or bankruptcy or winding-up of a Shareholder may, upon such evidence as to his title being produced as may from time to time be required by the Board, and subject as hereinafter provided, elect either to be registered himself as holder of the Share or to have some person nominated by him registered as the transferee thereof.		Registration of personal representatives and trustees in bankruptcy
46	If the person becoming entitled to a Share pursuant to Article 45 shall elect to be registered himself as the holder of such Share, he shall deliver or send to the Company a notice in writing signed by him, at (unless the Board otherwise agrees) the Registered Office, stating that he so elects. If he shall elect to have his nominee registered, he shall testify his election by executing a transfer of such Share to his nominee. All the limitations, restrictions and provisions of these Articles relating to the right to transfer and the registration of transfers of Shares shall be applicable to any such notice or transfer as aforesaid as if the death, bankruptcy or winding- up of the Shareholder had not occurred and the notice or transfer were a transfer executed by such Shareholder.		Notice of election to be registered of nominee

 

47

A person becoming entitled to a Share by reason of the death, bankruptcy or winding-up of the holder shall be entitled to the same Dividends and other advantages to which he would be entitled if he were the registered holder of the Share. However, the Board may, if it thinks fit, withhold the payment of any Dividend payable or other advantages in respect of such Share until such person shall become the registered holder of the Share or shall have effectually transferred such Share, but, subject to the requirements of Article 76 being met, such a person may vote at general meetings of the Company.

Retention of dividends, etc. until transmission of shares of a deceased or bankrupt shareholder

 

Forfeiture of Shares

 

48	If a Shareholder fails to pay any call or instalment of a call on the day appointed for payment thereof, the Board may, at any time thereafter during such time as any part of the call or instalment remains unpaid, without prejudice to the provisions of Article 31, serve notice on him requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued and which may still accrue up to the date of actual payment.		If call or instalment not paid notice may be given
49	The notice shall name a further day (not earlier than the expiration of fourteen (14) days from the date of the notice) on or before which the payment required by the notice is to be made, and it shall also name the place where payment is to be made. The notice shall also state that, in the event of non-payment at or before the time appointed, the Shares in respect of which the call was made will be liable to be forfeited.		Content of notice of call

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	18 of 55

 

 

 

50	If the requirements of any such notice as aforesaid are not complied with, any Share in respect of which the notice has been given may at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of the Board to that effect. Such forfeiture shall include all Dividends and bonuses declared in respect of the forfeited Share and not actually paid before the forfeiture. The Board may accept the surrender of any Share liable to be forfeited hereunder and in such cases references in these Articles to forfeiture shall include surrender.		If notice not complied with shares may be forfeited
51	Any Share so forfeited shall be deemed to be the property of the Company, and may be re-allotted, sold or otherwise disposed of on such terms and in such manner as the Board thinks fit and at any time before a sale or disposition, the forfeiture may be cancelled on such terms as the Board thinks fit.		Forfeited shares to become property of Company
52	A person whose Shares have been forfeited shall cease to be a Shareholder in respect of the forfeited Shares, but shall, nevertheless, remain liable to pay to the Company all moneys which, at the date of forfeiture, were payable by him to the Company in respect of the forfeited Shares, together with (if the Board shall in its discretion so require) interest thereon from the date of forfeiture until the date of actual payment (including the payment of such interest) at such rate not exceeding 20% per annum as the Board may prescribe, and the Board may enforce the payment thereof if it thinks fit, and without any deduction or allowance for the value of the Shares at the date of forfeiture, but his liability shall cease if and when the Company shall have received payment in full of all such moneys in respect of the Shares. For the purposes of this Article any sum which by the terms of issue of a Share, is payable thereon at a fixed time which is subsequent to the date of forfeiture, whether on account of the nominal value of the Share or by way of premium, shall notwithstanding that such time has not yet arrived be deemed to be payable on the date of forfeiture, and the same shall become due and payable immediately upon the forfeiture, but interest thereon shall only be payable in respect of any period between the said fixed time and the date of actual payment.		Arrears to be paid not withstanding forfeiture
53	A certificate in writing that the declarant is a Director or the Secretary, and that a Share has been duly forfeited or surrendered on a date stated in the certificate, shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the Share. The Company may receive the consideration, if any, given for the Share on any re-allotment, sale or disposition thereof and may execute a transfer of the Share in favour of the person to whom the Share is re-allotted, sold or disposed of and such person shall thereupon be registered as the holder of the Share, and shall not be bound to see to the application of the subscription or purchase money, (if any), nor shall his title to the Share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, re-allotment, sale or disposal of such Share.		Evidence of forfeiture and transfer of forfeited share
54	When any Share shall have been forfeited, notice of the forfeiture shall be given to the Shareholder in whose name it stood immediately prior to the forfeiture, and an entry of the forfeiture, with the date thereof, shall forthwith be made in the Register, but no forfeiture shall be in any manner invalidated by any omission or neglect to give such notice or make any such entry.		Notice after forfeiture

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	19 of 55

 

 

 

55	Notwithstanding any such forfeiture as aforesaid the Board may at any time, before any Shares so forfeited shall have been re-allotted, sold or otherwise disposed of, cancel the forfeiture on such terms as it thinks fit or permit the Shares so forfeited to be bought back or redeemed upon the terms of payment of all calls and interest due upon and expenses incurred in respect of the Shares, and upon such further terms (if any) as it thinks fit.			Power to redeem forfeited shares
56	The forfeiture of a Share shall not prejudice the right of the Company to any call already made or any instalment payment thereon.			Forfeiture not to prejudice Company’s right to call or instalment
57	(a)	The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any sum which, by terms of issue of a Share, becomes payable at a fixed time, whether on account of the nominal value of the Share or by way of premium, as if the same had been payable by virtue of a call duly made and notified.		Forfeiture for non-payment of any sum due on shares
	(b)	In the event of a forfeiture of Shares the Shareholder shall be bound to deliver and shall forthwith deliver to the Company the certificate or certificates held by him for the Shares so forfeited and in any event the certificates representing Shares so forfeited shall be void and of no further effect.

 

General Meetings

58	Other than the fiscal year of the Company’s adoption of these Articles, the Company shall in each fiscal year hold a general meeting as its annual general meeting in addition to any other meeting in that year at such time and place as may be determined by the Board and shall specify the meeting as such in the notice calling it. A meeting of the Shareholders or any class thereof may be held by means of such telephone, electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and participation in such a meeting shall constitute presence at such meetings.			When annual general meeting to be held
59	All general meetings other than annual general meetings shall be called extraordinary general meetings.			Extraordinary general meeting
60	The Board may, whenever it thinks fit, convene an extraordinary general meeting. Extraordinary general meetings shall also be convened on the requisition of one (1) or more Shareholders holding, at the date of deposit of the requisition, not less than one tenth of the paid up capital of the Company having the right of voting at general meetings. Such requisition shall be made in writing to the Board or the Secretary for the purpose of requiring an extraordinary general meeting to be called by the Board for the transaction of any business specified in such requisition. Such meeting shall be held within two (2) Months after the deposit of such requisition. If within twenty-one (21) days of such deposit, the Board fails to proceed to convene such meeting, the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of the Board shall be reimbursed to the requisitionist(s) by the Company.			Convening of extraordinary general meeting

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	20 of 55

 

 

 

61	Every general meeting of the Company shall be called by at least ten (10) clear days’ notice in writing. The notice shall be exclusive of the day on which it is served or deemed to be served and of the day for which it is given, and shall specify the place, the day, the hour and the agenda of the meeting and particulars of the resolutions to be considered at that meeting and the general nature of that business, and shall be given, in manner hereinafter mentioned or in such other manner, if any, as may be prescribed by the Company in general meeting, to such persons as are, under these Articles, entitled to receive such notices from the Company, provided that a meeting of the Company shall notwithstanding that it is called by shorter notice than that specified in this Article be deemed to have been duly called if it is so agreed:			Notice of meetings
	(a)	in the case of a meeting called as the annual general meeting, by all the Shareholders entitled to attend and vote thereat; and
	(b)	in the case of any other meeting, by a majority in number of the Shareholders having a right to attend and vote at the meeting, being a majority together holding not less than ninety-five per cent. (95%) of the total voting rights at the meeting of all Shareholders.
62	(a)	The accidental omission to give any notice to, or the non-receipt of any notice by, any person entitled to receive notice shall not invalidate any resolution passed or any proceedings at any such meeting.		Omission to give notice
	(b)	In the case where forms of proxy or notice of appointment of corporate representative are to be sent out with any notice, the accidental omission to send such forms of proxy or notice of appointment of corporate representative to, or the non-receipt of such forms by, any person entitled to receive notice of the relevant meeting shall not invalidate any resolution passed or any proceeding at any such meeting.

 

Proceedings at General Meetings

63	All business shall be deemed special that is transacted at an extraordinary general meeting and also all business shall be deemed special that is transacted at an annual general meeting with the exception of the election of Directors.			Special business, business of annual general meeting
64	For all purposes the quorum for a general meeting shall be two (2) Shareholders entitled to vote and present in person (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy representing not less than one-third (1/3) in nominal value of the total issued voting shares in the Company throughout the meeting. No business other than the appointment of a chairman of a meeting shall be transacted at any general meeting unless the requisite quorum shall be present at the time when the meeting proceeds to business and continues to be present until the conclusion of the meeting.			Quorum
65	If within fifteen (15) minutes from the time appointed for the meeting a quorum is not present, the meeting, if convened upon the requisition of Shareholders, shall be dissolved, but in any other case it shall stand adjourned to the same day in the next week and at such time and place as shall be decided by the Board, and if at such adjourned meeting a quorum is not present within fifteen (15) minutes from the time appointed for holding the meeting, the Shareholder or the Shareholders present in person (or, in the case of a Shareholder being a corporation by its duly authorised representative) or by proxy and entitled to vote shall be a quorum and may transact the business for which the meeting was called.			When quorum is not present meeting to be dissolved and when to be adjourned

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	21 of 55

 

 

 

66	The chairman (if any) of the Company or if he is absent or declines to take the chair at such meeting, the vice chairman (if any) of the Company shall take the chair at every general meeting, or, if there be no such chairman or vice chairman, or, if at any general meeting neither of such chairman or vice chairman is present within fifteen (15) minutes after the time appointed for holding such meeting, or both such persons decline to take the chair at such meeting, the Directors present shall choose one of their number as chairman of the meeting, and if no Director be present or if all the Directors present decline to take the chair or if the chairman chosen shall retire from the chair, then the Shareholders present shall choose one of their number to be chairman of the meeting.			chairman of general meeting
67	The chairman of the meeting may, with the consent of any general meeting at which a quorum is present, and shall, if so directed by the meeting, adjourn any meeting from time to time and from place to place as the meeting shall determine. Whenever a meeting is adjourned for fourteen (14) days or more, at least seven (7) clear days’ notice, specifying the place, the day and the hour of the adjourned meeting shall be given in the same manner as in the case of an original meeting but it shall not be necessary to specify in such notice the nature of the business to be transacted at the adjourned meeting. Save as aforesaid, no notice of an adjournment or of the business to be transacted at any adjourned meeting needs to be given nor shall any Shareholder be entitled to any such notice. No business shall be transacted at an adjourned meeting other than the business which might have been transacted at the meeting from which the adjournment took place.			Power to adjourn general meeting, business of adjourned meeting
68	At any general meeting a resolution put to the vote of the meeting shall be decided by poll save that the chairman of the meeting may, pursuant to the Designated Stock Exchange Rules, allow a resolution to be voted on by a show of hands. Where a show of hands is allowed, before or on the declaration of the result of the show of hands, a poll may be demanded by:			Poll, show of hands and demand for poll
	(a)	the chairman of such meeting or
	(b)	any one Shareholder present in person (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy for the time being entitled to vote at the meeting.
69	Where a resolution is voted on by a show of hands, a declaration by the chairman of the meeting that a resolution has on a show of hands been carried or carried unanimously, or by a particular majority, or not carried by a particular majority, or lost, and an entry to that effect made in the minute book of the Company shall be conclusive evidence of the facts without proof of the number or proportion of the votes recorded in favour of or against such resolution.			What is to be evidence of the passing of a resolution
70	A poll demanded on the election of a chairman, or on a question of adjournment, shall be taken forthwith. A poll demanded on any other question shall be taken in such manner (including the use of ballot or voting papers or tickets) and either forthwith or at such time (being not later than thirty (30) days after the date of the demand) and place as the chairman directs. It shall not be necessary (unless the chairman otherwise directs) for notice to be given of a poll not taken immediately. The result of the poll shall be deemed to be the resolution of the meeting at which the poll was required or demanded. There shall be no requirement for the chairman to disclose the voting figures on a poll. In the event that a poll is demanded after the chairman of the meeting allows a show of hands pursuant to Article 68, the demand for a poll may be withdrawn, with the consent of the chairman of the meeting, at any time before the close of the meeting at which the poll was demanded or the taking of the poll, whichever is the earlier.			Poll

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	22 of 55

 

 

 

71	Any poll on the election of a chairman of a meeting or on any question of adjournment shall be taken at the meeting and without adjournment.
72	All questions submitted to a meeting shall be decided by a simple majority of votes except where a greater majority is required by these Articles or by the Companies Act. In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting shall be entitled to a second or casting vote. In case of any dispute as to the admission or rejection of any vote, the chairman of the meeting shall determine the same, and such determination shall be final and conclusive.		chairman to have casting vote
73	The demand for a poll shall not prevent the continuance of a meeting for the transaction of any business other than the question on which a poll has been demanded, and, with the consent of the chairman, it may be withdrawn at any time before the close of the meeting or the taking of the poll, whichever is the earlier.		Business may proceed notwithstanding demand for poll
74	If an amendment shall be proposed to any resolution under consideration but shall in good faith be ruled out of order by the chairman of the meeting, the proceedings shall not be invalidated by any error in such ruling. In the case of a resolution duly proposed as a Special Resolution no amendment thereto (other than a mere clerical amendment to correct a patent error) may in any event be considered or voted upon.		Amendment of resolutions

 

Votes of Shareholders

 

75

Subject to any special rights, privileges or restrictions as to voting for the time being attached to any class or classes of Shares, at any general meeting on a poll every Shareholder present in person (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy, shall have one (1) vote for every Share of which he is the holder which is fully paid or credited as fully paid (but so that no amount paid or credited as paid on a Share in advance of calls or instalments shall be treated for the purposes of this Article as paid on the Share), and on a show of hands every Shareholder who is present in person (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy shall (save as provided otherwise in this Article) have one (1) vote. On a poll a Shareholder entitled to more than one (1) vote need not use all his votes or cast all his votes in the same way. Notwithstanding anything contained in these Articles, where more than one (1) proxy is appointed by a Shareholder which is a Clearing House (or its nominee(s)) or a central depository house (or its nominee(s)), each such proxy shall have one (1) vote on a show of hands and on a poll, each such proxy is under no obligation to cast all his votes in the same way.

Votes of shareholders

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	23 of 55

 

 

 

76	Any person entitled under Article 47 to be registered as the holder of any Shares may vote at any general meeting in respect thereof in the same manner as if he were the registered holder of such Shares, provided that at least forty-eight (48) hours before the time of the holding of the meeting or adjourned meeting (as the case may be) at which he proposes to vote, he shall satisfy the Board of his right to be registered as the holder of such Shares or the Board shall have previously admitted his right to vote at such meeting in respect thereof.		Votes in respect of deceased and bankrupt shareholders
77	Where there are joint registered holders of any Share, any one of such persons may vote at any meeting, either personally or by proxy, in respect of such Share as if he were solely entitled thereto; but if more than one of such joint holders be present at any meeting personally (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy, that one of the said persons so present whose name stands first on the Register in respect of such Share shall alone be entitled to vote in respect thereof. Several executors or administrators of a deceased Shareholder, and several trustees in bankruptcy or liquidators of a Shareholder in whose name any Share stands shall for the purposes of this Article be deemed joint holders thereof.		Joint holders
78	A Shareholder of unsound mind or in respect of whom an order has been made by any court having jurisdiction in lunacy may vote, whether on a poll or on a show of hands, by his committee or receiver, or other person in the nature of a committee or receiver appointed by that court, and any such committee, receiver or other person may vote on a poll by proxy. Evidence to the satisfaction of the Board of the authority of the person claiming to exercise the right to vote shall be delivered to such place or one of such places (if any) as is specified in accordance with these Articles for the deposit of instruments of proxy or, if no place is specified, at the Registered Office, not later than the latest time at which an instrument of proxy must, if it is to be valid for the meeting, be delivered.		Votes of shareholders of unsound mind
79	Save as expressly provided in these Articles or otherwise determined by the Board, no person other than a Shareholder duly registered and who shall have paid everything for the time being due from him payable to the Company in respect of his Shares shall be entitled to be present or to vote (save as proxy or authorised representative for another Shareholder) whether personally, by proxy or by attorney or to be reckoned in the quorum, at any general meeting.		Qualification for voting
80	No objection shall be raised to the qualification of any person exercising or purporting to exercise a vote or the admissibility of any vote except at the meeting or adjourned meeting at which the vote objected to is given or tendered, and every vote not disallowed at such meeting shall be valid for all purposes. Any such objection made in due time shall be referred to the chairman of the meeting, whose decision shall be final and conclusive.		Objections to votes

 

Appointment of Proxy and Corporate Representative

 

81

Any Shareholder entitled to attend and vote at a meeting of the Company shall be entitled to appoint another person as his proxy to attend and vote instead of him. A Shareholder who is the holder of two (2) or more Shares may appoint more than one proxy to represent him and vote on his behalf at a general meeting of the Company or at a class meeting. A proxy need not be a Shareholder of the Company. On a poll or a show of hands votes may be given either personally (or, in the case of a Shareholder being a corporation, by its duly authorised representative) or by proxy. A proxy shall be entitled to exercise the same powers on behalf of a Shareholder who is an individual and for whom he acts as proxy as such Shareholder could exercise. In addition, a proxy shall be entitled to exercise the same powers on behalf of a Shareholder which is a corporation and for which he acts as proxy as such Shareholder could exercise if it were an individual Shareholder.

Proxies

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	24 of 55

 

 

 

82	No appointment of a proxy shall be valid unless it names the person appointed and his appointor. The Board may, unless it is satisfied that the person purporting to act as proxy is the person named in the relevant instrument for his appointment and the validity and authenticity of the signature of his appointor, decline such person’s admission to the relevant meeting, reject his vote or, in the event that a poll is demanded after the chairman of the meeting allows a show of hands pursuant to Article 68, his demand for a poll and no Shareholder who may be affected by any exercise by the Board of its power in this connection shall have any claim against the Directors or any of them nor may any such exercise by the Board of its powers invalidate the proceedings of the meeting in respect of which they were exercised or any resolution passed or defeated at such meeting.
83	The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under seal or under the hand of an officer or attorney duly authorised.		Instrument appointing proxy to be in writing
84	The instrument appointing a proxy and, if requested by the Board, the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power or authority shall be deposited at such place or one of such places (if any) as is specified in the notice of meeting or in the instrument of proxy issued by the Company (or, if no place is specified, at the Registered Office) not less than forty-right (48) hours before the time for holding the meeting or adjourned meeting (as the case may be) at which the person named in such instrument proposes to vote, and in default the instrument of proxy shall not be treated as valid. No instrument appointing a proxy shall be valid after the expiration of twelve (12) Months from the date of its execution, except at an adjourned meeting where the meeting was originally held within twelve (12) Months from such date. Delivery of an instrument appointing a proxy shall not preclude a Shareholder from attending and voting in person (or in the case of a Shareholder being a corporation, its duly authorised representative) at the meeting concerned and, in such event, the instrument appointing a proxy shall be deemed to be revoked.		Appointment of proxy must be deposited
85	Every instrument of proxy, whether for a specified meeting or otherwise, shall be in any common form or in such form as the Board may from time to time approve, provided that it shall not preclude the use of the two-way form. Any form issued to a Shareholder for use by him for appointing a proxy to attend and vote at an extraordinary general meeting or at an annual general meeting at which any business is to be transacted shall be such as to enable the Shareholder, according to his intentions, to instruct the proxy to vote in favour of or against (or, in default of instructions, to exercise his discretion in respect of) each resolution dealing with any such business.		Form of proxy

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	25 of 55

 

 

 

86	The instrument appointing a proxy to vote at a general meeting shall: (i) be deemed to confer authority upon the proxy to demand or join in demanding a poll and to vote on any resolution (or amendment thereto) put to the meeting for which it is given as the proxy thinks fit; and (ii) unless the contrary is stated therein, be valid as well for any adjournment of the meeting as for the meeting to which it relates.			Authority under instrument appointing proxy
87	A vote given in accordance with the terms of an instrument of proxy or by the duly authorised representative of a corporation shall be valid notwithstanding the previous death or insanity of the principal or revocation of the proxy or power of attorney or other authority under which the proxy was executed or the transfer of the Share in respect of which the proxy is given, provided that no intimation in writing of such death, insanity, revocation or transfer as aforesaid shall have been received by the Company at its Registered Office, or at such other place as is referred to in Article 84, at least two (2) hours before the commencement of the meeting, or the taking of the poll, or adjourned meeting at which the instrument of proxy is used.			When vote by proxy valid though authority revoked
88	(a)	Any corporation which is a Shareholder may, by resolution of its directors or other governing body or by power of attorney, authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of Shareholders of the Company, and the person so authorised shall be entitled to exercise the same rights and powers on behalf of the corporation which he represents as that corporation could exercise if it were an individual Shareholder of the Company. References in these Articles to a Shareholder present in person at a meeting shall, unless the context otherwise requires, include a corporation which is a Shareholder represented at the meeting by such duly authorised representative.		Appointment of multiple corporate representatives
	(b)	Where a Shareholder is a Clearing House (or its nominee(s)) or a central depository house (or its nominee(s)), it may authorise such person or persons as it thinks fit to act as its representative or representatives at any meeting of the Company or at any meeting of any class of Shareholders provided that if more than one person is so authorised, the authorisation shall specify the number and class of Shares in respect of which each such representative is so authorised. A person so authorised pursuant to the provisions of this Article shall be deemed to have been duly authorised without further evidence of the facts and be entitled to exercise the same rights and powers on behalf of the Clearing House (or its nominee(s)) or a central depository house (or its nominee(s)) which he represents as that Clearing House (or its nominee(s)) or a central depository house (or its nominee(s)) could exercise as if such person were an individual Shareholder, including the right to vote.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	26 of 55

 

 

 

89

No appointment of a corporate representative shall be valid unless it names the person authorised to act as the appointor’s representative and the appointor is also named. The Board may, unless it is satisfied that a person purporting to act as a corporate representative is the person named in the relevant instrument for his appointment, decline such person’s admission to the relevant meeting and/or reject his vote or demand for a poll and no Shareholder who may be affected by any exercise by the Board of its power in this connection shall have any claim against the Board or any of them nor may any such exercise by the Board of its powers invalidate the proceedings of the meeting in respect of which they were exercised or any resolution passed or defeated at such meeting.

 

Registered Office

 

90

The Registered Office of the Company shall be at such place in the Cayman Islands as the Board shall from time to time decide.

Registered Office

 

Board of Directors

 

91	Unless otherwise determined by the Company in general meeting, the number of Directors shall not be less than two (2). There shall be no maximum number of Directors unless otherwise determined from time to time by the Company in general meeting. The Directors shall be elected or appointed in accordance with Articles 103, 104 and 105 and shall hold office until their successors are elected or appointed. The Company shall keep at its Registered Office a register of its directors and officers in accordance with the Companies Act.		Number of Directors
92	A Director may at any time, by notice in writing signed by him delivered to the Registered Office or at the Head Office or at a meeting of the Board, appoint any person (including another Director) to act as alternate Director in his place during his absence and may in like manner at any time determine such appointment. If such person is not another Director such appointment unless previously approved by the Board shall have effect only upon and subject to being so approved. Any person so appointed shall have all the rights and powers of the Director or Directors for whom such person is appointed in the alternative provided that such person shall not be counted more than once in determining whether or not a quorum is present. An alternate Director may be removed at any time by the body which appointed him and, subject thereto, the office appointment of an alternate Director shall continue until the happening of any event which, were he a Director, would cause him to vacate such office or if his appointor ceases to be a Director. Any appointment or removal of an alternate Director shall be effected by notice signed by the appointor and delivered to the Office or head office or tendered at a meeting of the Board. An alternate Director may act as alternate to more than one Director. An alternate Director shall ipso facto cease to be an alternate Director if his appointor ceases for any reason to be a Director, however, such alternate Director or any other person may be re-appointed by the Directors to serve as an alternate Director PROVIDED always that, if at any meeting any Director retires but is re-elected at the same meeting, any appointment of such alternate Director pursuant to these Articles which was in force immediately before his retirement shall remain in force as though he had not retired.		Alternate Directors

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	27 of 55

 

 

 

93	(a)	An alternate Director shall (subject to his giving to the Company an address, telephone and facsimile number within the territory of the Head Office for the time being for the giving of notices on him and except when absent from the territory in which the Head Office is for the time being situate) be entitled (in addition to his appointor) to receive and (in lieu of his appointor) to waive notices of meetings of the Board and of any committee of the Board of which his appointor is a member and shall be entitled to attend and vote as a Director at any such meeting at which the Director appointing him is not personally present and generally at such meeting to perform all the functions of his appointor as a Director and for the purposes of the proceedings at such meeting the provisions of these Articles shall apply as if he (instead of his appointor) were a Director. If he shall be himself a Director or shall attend any such meeting as an alternate for more than one Director his voting rights shall be cumulative. If his appointor is for the time being absent from the territory in which the Head Office is for the time being situate or otherwise not available or unable to act, his signature to any resolution in writing of the Directors or any such committee shall be as effective as the signature of his appointor. His attestation of the affixing of the Seal shall be as effective as the signature and attestation of his appointor. An alternate Director shall not, save as aforesaid, have power to act as a Director nor shall he be deemed to be a Director for the purposes of these Articles.		Rights of Alternate Directors
	(b)	An alternate Director shall be entitled to contract and be interested in and benefit from contracts or arrangements or transactions and to be repaid expenses and to be indemnified to the same extent mutatis mutandis as if he were a Director, but he shall not be entitled to receive from the Company in respect of his appointment as alternate Director any remuneration except only such part (if any) of the ordinary remuneration otherwise payable to his appointor as such appointor may by notice in writing to the Company from time to time direct.
	(c)	A certificate by a Director (including for the purpose of this paragraph (c) an alternate Director) or the Secretary that a Director (who may be the one signing the certificate) was at the time of a resolution of the Directors or any committee thereof absent from the territory of the Head Office or otherwise not available or unable to act or has not supplied an address, telephone and facsimile number within the territory of the Head Office for the purposes of giving of notice to him shall in favour of all persons without express notice to the contrary, be conclusive of the matter so certified.

 

94	A Director or an alternate Director shall not be required to hold any qualification Shares but shall nevertheless be entitled to attend and speak at all general meetings of the Company and all meetings of any class of Shareholders of the Company.		Share qualification of Directors or alternate Directors
95	Subject to the Designated Stock Exchange Rules, the Directors shall receive such remuneration as the Board may from time to time determine.		Directors’ remuneration
96	The Directors shall also be entitled to be repaid all travelling, hotel and other expenses reasonably incurred by them respectively in or about the performance of their duties as Directors, including their expenses of travelling to and from Board meetings, committee meetings or general meetings or otherwise incurred whilst engaged on the business of the Company or in the discharge of their duties as Directors.		Directors’ expenses

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	28 of 55

 

 

 

97	The Board may grant special remuneration to any Director who shall perform or has performed any special or extra services at the request of the Company. Such special remuneration may be made payable to such Director in addition to or in substitution for his ordinary remuneration as a Director, and may be made payable by way of salary, commission or participation in profits or otherwise as may be arranged.
98	Notwithstanding Articles 95, 96 and 97, the remuneration of a Director appointed to any other office in the management of the Company may from time to time be fixed by the Board and may be by way of salary, commission, or participation in profits or otherwise or by all or any of those modes and with such other benefits (including pension and/or gratuity and/or other benefits on retirement) and allowances as the Board may from time to time decide. Such remuneration shall be in addition to his ordinary remuneration as a Director.		Remuneration of directors to any other office, etc.
99	Payments to any Director or past director of the Company of any sum by way of compensation for loss of office or as consideration for or in connection with his retirement from office (not being a payment to which the director of the Company or past director is contractually or statutorily entitled) must be approved by the Company in general meeting.		Payments for compensation for loss of office
100	A Director shall vacate his office:		When office of Director to be vacated

 

(a)

if he becomes bankrupt or has a receiving order made against him or suspends payment or compounds with his creditors generally; or

 

(b)

if he dies or becomes of unsound mind as determined pursuant to an order made by any competent court or official on the grounds that he is or may be suffering from mental disorder or is otherwise incapable of managing his affairs and the Board resolves that his office be vacated; or

 

(c)

if he absents himself from the meetings of the Board during a continuous period of six (6) months, without special leave of absence from the Board, and his alternate Director (if any) shall not during such period have attended in his stead, and the Board resolves that his office be vacated; or

 

(d)

if he becomes prohibited by any applicable law or Designated Stock Exchange Rules from acting as a Director, or he ceases to be a Director by virtue of any provision of any applicable law or Designated Stock Exchange Rules or is removed from office pursuant to these Articles; or

 

(e)

if by notice in writing delivered to the Company at its Registered Office or at the Head Office or tendered at a meeting of the Board he resigns his office; or

 

(f)

if he shall be removed from office by an Ordinary Resolution of the Company under Article 107; or

 

(g)

if he shall be removed from the office by notice in writing served on him signed by not less than ¾ in number (or if that is not a round number, the nearest lower round number) of the Directors (including himself) then in office.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	29 of 55

 

 

 

101

No Director shall be required to vacate office or be ineligible for re-election or re- appointment as a Director, and no person shall be ineligible for appointment as a Director by reason only of his having attained any particular age.

 

102

(a)

Subject to the Companies Act and to these Articles, no Director or intended Director shall be disqualified by his office from contracting with the Company either as vendor, purchaser or otherwise nor shall any such contract or any contract or arrangement entered into by or on behalf of the Company with any person, company or partnership of or in which any Director shall be a member or otherwise interested be capable on that account of being avoided, nor shall any Director so contracting or being any member or so interested be liable to account to the Company for any profit so realized by any such contract or arrangement by reason only of such Director holding that office or the fiduciary relationship thereby established, provided that such Director shall, if his interest in such contract or arrangement is material, declare the nature of his interest at the earliest meeting of the Board at which it is practicable for him to do so, either specifically or by way of a general notice stating that, by reason of the facts specified in the notice, he is to be regarded as interested in any contracts of a specified description which may subsequently be made by the Company. Any such transaction that would reasonably be likely to affect a Director’s status as an “Independent Director”, or that would constitute a “related party transaction” as defined by Item 7.N of Form 20F promulgated by the SEC, shall require the approval of the Audit Committee.

Directors’ interests

 

(b)

Any Director may continue to be or become a director or other officer or member of any other company in which the Company may be interested and (unless otherwise agreed between the Company and the Director) no such Director shall be liable to account to the Company or the Shareholders for any remuneration or other benefits received by him as a director or other officer or member of any such other company. The Directors may exercise the voting powers conferred by the shares in any other company held or owned by the Company, or exercisable by them as directors of such other company in such manner in all respects as they think fit (including the exercise thereof in favour of any resolution appointing themselves or any of them as directors or other officers of such company) and any Director may vote in favour of the exercise of such voting rights in the manner aforesaid notwithstanding that he may be, or is about to be, appointed a director or other officer of such a company, and that as such he is or may become interested in the exercise of such voting rights in the manner aforesaid.

 

(c)

A Director may hold any other office or place of profit with the Company (except that of Auditors) in conjunction with his office of Director for such period and upon such terms as the Board may determine, and may be paid such extra remuneration therefor (whether by way of salary, commission, participation in profit or otherwise) as the Board may determine, and such extra remuneration shall be in addition to any remuneration provided for by or pursuant to any other Articles.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	30 of 55

 

 

 

(d)

A Director may act by himself or his firm in a professional capacity for the Company (otherwise than as Auditor) and he or his firm may be remunerated for professional services as if he were not a Director.

 

Notwithstanding the foregoing, no “Independent Director” as defined in Designated Stock Exchange Rules or in Rule 10A-3 under the Exchange Act, and with respect of whom the Board has determined constitutes an “Independent Director” for purposes of compliance with applicable law or the Company’s listing requirements, shall without the consent of the Audit Committee take any of the foregoing actions or any other action that would reasonably be likely to affect such Director’s status as an “Independent Director” of the Company.

 

APPOINTMENT OF DIRECTORS  

 

103	The Company in general meeting may from time to time fix and may from time to time by Ordinary Resolution increase or reduce the maximum and minimum number of Directors but so that the number of Directors shall not be less than two (2).		Power of general meeting to increase or reduce number of Directors
104	Subject to the Articles and the Companies Act, the Company may from time to time in general meeting by Ordinary Resolution elect any person to be a Director either to fill a casual vacancy or as an additional Director.		Appointment of Directors
105	The Board shall have power from time to time and at any time to appoint any person as a Director either to fill a casual vacancy or as an additional Director but so that the number of Directors so appointed shall not exceed the maximum number determined from time to time by the Shareholders in general meeting.
106	Unless otherwise provided by the rules of the Designated Stock Exchange, no person, other than a retiring Director, shall, unless recommended by the Board for election, be eligible for election to the office of Director at any general meeting.
107	Subject to any provision to the contrary in these Articles, the Shareholders may by Ordinary Resolution remove any Director before the expiration of his term of office notwithstanding anything in these Articles or in any agreement between the Company and such Director (but without prejudice to any claim which such Director may have for damages for any breach of any contract between him and the Company) and may by Ordinary Resolution elect another person in his stead.		Power to remove Director by Ordinary Resolution

 

BORROWING POWERS

 

108	The Board may from time to time at its discretion exercise all the powers of the Company to raise or borrow or to secure the payment of any sum or sums of money for the purposes of the Company and to mortgage or charge its undertaking, property and uncalled capital or any part thereof.		Power to borrow
109	The Board may raise or secure the payment or repayment of such sum or sums in such manner and upon such terms and conditions in all respects as it thinks fit and in particular but subject to the provisions of the Companies Act, by the issue of debentures, debenture stock, bonds or other securities of the Company, whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.		Conditions on which money may be borrowed

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	31 of 55

 

 

 

110	Debentures, debenture stock, bonds and other securities (other than Shares which are not fully paid) may be made assignable free from any equities between the Company and the person to whom the same may be issued.		Assignment of debentures etc.
111	Any debentures, debenture stock, bonds or other securities (other than Shares) may be issued at a discount, premium or otherwise and with any special privileges as to redemption, surrender, drawings, allotment or subscription of or conversion into Shares, attending and voting at general meetings of the Company, appointment of Directors and otherwise.		Special privileges of debentures etc.
112	The Directors shall cause a proper register to be kept, in accordance with the provisions of the Companies Act, of all mortgages and charges specifically affecting the property of the Company and shall duly comply with such provisions of the Companies Act with regard to the registration of mortgages and charges as may be specified or required.		Register of charges to be kept
113	If the Company issues a series of debentures or debenture stock not transferable by delivery, the Board shall cause a proper register to be kept of the holders of such debentures.		Register of debentures or debenture stock
114	Where any uncalled capital of the Company is charged, all persons taking any subsequent charge thereon shall take the same subject to such prior charge, and shall not be entitled, by notice to the Shareholders or otherwise, to obtain priority over such prior charge.		Mortgage of uncalled capital

 

GENERAL POWERS OF THE DIRECTORS

 

115	The business of the Company shall be managed and conducted by the Board who, in addition to the powers and authorities by these Articles expressly conferred upon it, may exercise all powers of the Company (whether relating to the management of the business of the Company or otherwise) and do all such acts and things as may be exercised or done or approved by the Company and are not hereby or by the Statutes expressly directed or required to be exercised or done by the Company in general meeting, but subject nevertheless to the provisions of the Companies Act and of these Articles and to any regulations from time to time made by the Company in general meeting not being inconsistent with such provisions or these Articles, provided that no regulation so made shall invalidate any prior act of the Board which would have been valid if such regulation had not been made. The general powers given by this Article shall not be limited or restricted by any special authority or power given to the Board by any other Article.		General powers of Company vested in Directors
116	Without prejudice to the general powers conferred by these Articles, it is hereby expressly declared that the Board shall have the following powers:

 

(a)

to give to any person the right or option of requiring at a future date that an allotment shall be made to him of any Share at par or at such premium and on such other terms as may be agreed; and

 

(b)

to give to any Directors, officers or employees of the Company an interest in any particular business or transaction or participation in the profits thereof or in the general profits of the Company either in addition to or in substitution for a salary or other remuneration.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	32 of 55

 

 

 

117

The Board may, from time to time, and except as required by applicable law or the Designated Stock Exchange Rules, adopt, institute, amend, modify or revoke the corporate governance policies or initiatives, which shall be intended to set forth the policies of the Company and the Board on various corporate governance related matters as the Board shall determine by resolution from time to time.

 

CHAIRMAN AND OTHER OFFICERS

 

118

The Board may from time to time elect or otherwise appoint one of them to the office of chairman of the Company and another to be the vice chairman of the Company (or two or more vice chairmen) and determine the period for which each of them is to hold office. The chairman of the Company or, in his absence, the vice chairman of the Company shall preside as chairman at meetings of the Board, but if no such chairman or vice chairman be elected or appointed, or if at any meeting the chairman or vice chairman is not present within five (5) minutes after the time appointed for holding the same and willing to act, the Directors present shall choose one of their number to be chairman of such meeting. The provisions of Article 98 shall mutatis mutandis apply to any Directors elected or otherwise appointed to any office in accordance with the provisions of this Article.

chairman, vice chairman and officers

 

PROCEEDINGS OF THE DIRECTORS

 

119	The Board may meet together for the despatch of business, adjourn and otherwise regulate its meetings and proceedings as it thinks fit and may determine the quorum necessary for the transaction of business. Unless otherwise determined two (2) Directors shall be a quorum. For the purpose of this Article an alternate Director shall be counted in a quorum separately in respect of himself (if a Director) and in respect of each Director for whom he is an alternate and his voting rights shall be cumulative and he need not use all his votes or cast all his votes in the same way. A meeting of the Board or any committee of the Board may be held by means of such telephone, electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, and participation in such a meeting shall constitute presence in person at such meeting.		Meeting of Directors, quorum, etc.
120	A Director may, and on the request of a Director the Secretary shall, at any time summon a meeting of the Board which may be held in any part of the world, but no such meeting shall be summoned to be held outside the territory in which the Head Office is for the time being situate without the prior approval of the Board. Notice thereof shall be given to each Director and alternate Director in person orally or in writing or by telephone or by telex or telegram or facsimile transmission at the telephone or facsimile number or address from time to time notified to the Company by such Director or in such other manner as the Board may from time to time determine. A Director absent or intending to be absent from the territory in which the Head Office is for the time being situate may request the Board or the Secretary that notices of Board meetings shall during his absence be sent in writing to him at his last known address, facsimile or telex number or any other address, facsimile or telex number given by him to the Company for this purpose, but such notices need not be given any earlier than notices given to the other Directors not so absent and in the absence of any such request it shall not be necessary to give notice of a Board meeting to any Director who is for the time being absent from such territory.		Convening of Meetings of Directors

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	33 of 55

 

 

 

121	Subject to Article 102, questions arising at any meeting of the Board shall be decided by a majority of votes, and in case of an equality of votes the chairman of the meeting shall have a second or casting vote. A Director who is also an alternate Director shall be entitled in the absence of his appointor to a separate vote on behalf of his appointor in addition to his own vote.		How questions to be decided
122	A meeting of the Board for the time being at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions by or under these Articles for the time being vested in or exercisable by the Board generally.		Powers of meeting

 

123

(a)

Subject to applicable law and the Designated Stock Exchange Rules, the Board may delegate any of their powers to any committee (including, without limitation, an Audit Committee, Compensation Committee or Remuneration Committee and Nomination Committee), consisting of one or more Directors. They may also delegate to any managing Director or any Director holding any other office such of their powers as they consider desirable to be exercised by him. Any such delegation may be made subject to any conditions the Directors may impose, and either collaterally with or to the exclusion of its own powers and may be revoked or altered. Subject to any such conditions, the proceedings of a committee with two (2) or more Members shall be governed by the provisions of the Articles regulating the proceedings of Directors so far as they are capable of applying. Where a provision of the Articles refers to the exercise of a power, authority or discretion by the Directors and that power, authority or discretion has been delegated by the Directors to a committee, the provision shall be construed as permitting the exercise of the power, authority or discretion by the committee.

Power to appoint committee and to delegate

 

(b)

The Board may delegate any of its powers to any other committees consisting of such Director or Directors and other person(s) as it thinks fit, and they may from time to time revoke such delegation or revoke the appointment of and discharge any such committees either wholly or in part, and either as to persons or purposes, but every committee so formed shall in the exercise of the powers so delegated conform to any regulations that may from time to time be imposed upon it by the Board.

 

124

All acts done by any such committee in conformity with such regulations and in fulfilment of the purposes for which it is appointed, but not otherwise, shall have the like force and effect as if done by the Board, and the Board (or if the Board delegates such power, the committee) shall have power to remunerate the members of any special committee, and charge such remuneration to the current expenses of the Company.

Act of committee to be of same effect as acts of Directors

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	34 of 55

 

 

 

125

The meetings and proceedings of any such committee consisting of two (2) or more members shall be governed by the provisions herein contained for regulating the meetings and proceedings of the Board so far as the same are applicable thereto and are not replaced by any regulations imposed by the Board pursuant to Article 123, indicating, without limitation, any committee charter adopted by the Board for purposes or in respect of any such committee.

Proceedings of committee

 

126

All acts bona fide done by any meeting of the Board or by any such committee or by any person acting as a Director shall, notwithstanding that it shall be afterwards discovered that there was some defect in the appointment of such Director or persons acting as aforesaid or that they or any of them were disqualified, be as valid as if every such person had been duly appointed and was qualified to be a Director or member of such committee.

When acts of Directors or committee to be valid

 

127

The continuing Directors may act notwithstanding any vacancy in their body, but, if and so long as their number is reduced below the number fixed by or pursuant to these Articles as the necessary quorum of the Board meeting, the continuing Director or Directors may act for the purpose of increasing the number of Directors to that number of the necessary quorum or of summoning a general meeting of the Company but for no other purpose.

Directors’ powers when vacancies exist

 

128

(a)

A resolution in writing signed by all the Directors (or their respective alternate Directors) shall be as valid and effectual as if it had been passed at a meeting of the Board duly convened and held. Any such resolutions in writing may consist of several documents in like form each signed by one or more of the Directors or alternate Directors.

Directors’ written resolutions

 

(b)

Where a Director is, on the date on which a resolution in writing is last signed by a Director, absent from the territory in which the Head Office is for the time being situated, or cannot be contacted at his last known address or contact telephone or facsimile number, or is temporarily unable to act through ill-health or disability and, in each case, his alternate (if any) is affected by any of these events, the signature of such Director (or his alternate) to the resolution shall not be required, and the resolution in writing, so long as such a resolution shall have been signed by at least two (2) Directors or their respective alternates who are entitled to vote thereon or such number of Directors as shall form a quorum, shall be deemed to have been passed at a meeting of the Board duly convened and held, provided that a copy of such resolution has been given or the contents thereof communicated to all the Directors (or their respective alternates) for the time being entitled to receive notices of meetings of the Board at their respective last known address, telephone or facsimile number or, if none, at the Head Office and provided further that no Director is aware of or has received from any Director any objection to the resolution.

 

(c)

A certificate signed by a Director (who may be one of the signatories to the relevant resolution in writing) or the Secretary as to any of the matters referred to in paragraph (a) or (b) of this Article shall in the absence of express notice to the contrary of the person relying thereon, be conclusive of the matters stated on such certificate.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	35 of 55

 

 

 

MINUTES AND CORPORATE RECORDS

 

129	(a)	The Board shall cause minutes to be made of:			Minutes of
					proceedings of
		(i)	all appointments of officers made by it;		meetings and
					Directors
		(ii)	the names of the Directors present at each meeting of the Board and of committees appointed pursuant to Article 123; and

 

(iii)

all resolutions and proceedings at all meetings of the Company and of the Board and of such committees.

 

(b)

Any such minutes shall be conclusive evidence of any such proceedings if they purport to be signed by the chairman of the meeting at which the proceedings were held or by the chairman of the next succeeding meeting.

 

SECRETARY

 

130

The Secretary shall be appointed by the Board for such term, at such remuneration and upon such conditions as it may think fit, and any Secretary so appointed may, without prejudice to his right under any contract with the Company, be removed by the Board. Anything by the Companies Act or these Articles required or authorised to be done by or to the Secretary, if the office is vacant or there is for any other reason no Secretary capable of acting, may be done by or to any assistant or deputy Secretary, or if there is no assistant or deputy Secretary capable of acting, by or to any officer of the Company authorised generally or specifically on behalf of the Board.

Appointment of Secretary

 

131

The Secretary shall attend all meetings of the Shareholders and shall keep correct minutes of such meetings and enter the same in the proper books provided for the purpose. He shall perform such other duties as are prescribed by the Companies Act and these Articles, together with such other duties as may from time to time be prescribed by the Board.

Duties of the Secretary

 

132

A provision of the Companies Act or of these Articles requiring or authorising a thing to be done by or to a Director and the Secretary shall not be satisfied by its being done by or to the same person acting both as Director and as, or in place of the Secretary.

Same person not to act in two capacities at once

 

GENERAL MANAGEMENT AND USE OF THE SEAL

 

133

(a)

Subject to the Companies Act, the Company shall have one or more Seals as the Board may determine, and may have a Seal for use outside the Cayman Islands. The Board shall provide for the safe custody of each Seal, and no Seal shall be used without the authority of the Board or a committee authorised by the Board in that behalf.

Custody of Seal

 

(b)

Every instrument to which a Seal shall be affixed shall be signed autographically by one Director and the Secretary, or by two (2) Directors, or by any person or persons (including a Director and/or the Secretary) appointed by the Board for the purpose, provided that as regards any certificates for Shares or Debentures or other securities of the Company, the Board may by resolution determine that such signatures or either of them shall be dispensed with or affixed by some method or system of mechanical signature other than autographic or may be printed thereon as specified in such resolution or that such certificates need not be signed by any person.

Use of Seal

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	36 of 55

 

 

 

(c)

The Company may have a Securities Seal for use for sealing certificates for shares or other securities issued by the Company and no signature of any Director, officer or other person and no mechanical reproduction thereof shall be required on any such certificates or other document and any such certificates or other document to which such Securities Seal is affixed shall be valid and deemed to have been sealed and executed with the authority of the Board notwithstanding the absence of any such signature or mechanical reproduction as aforesaid. The Board may by resolution determine that the affixation of Securities Seal on certificates for shares or other securities issued by the Company be dispensed with or be affixed by printing the image of the Securities Seal on such certificates.

Securities Seal

 

134

All cheques, promissory notes, drafts, bills of exchange and other negotiable instruments, and all receipts for moneys paid to the Company shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, in such manner as the Board shall from time to time by resolution determine. The Company’s banking accounts shall be kept with such banker or bankers as the Board shall from time to time determine.

Cheques and banking arrangements

 

135	(a)	The Board may from time to time and at any time, by power of attorney under the Seal, appoint any company, firm or person or any fluctuating body of persons, whether nominated directly or indirectly by the Board, to be the attorney or attorneys of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Board under these Articles) and for such period and subject to such conditions as it may think fit, and any such power of attorney may contain such provisions for the protection and convenience of persons dealing with any such attorney as the Board may think fit, and may also authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions vested in him.		Power to appoint attorney
	(b)	The Company may, by writing under its Seal, empower any person, either generally or in respect of any specified matter, as its attorney to execute deeds and instruments on its behalf and to enter into contracts and sign the same on its behalf and every deed signed by such attorney on behalf of the Company and under his seal shall bind the Company and have the same effect as if it were under the Seal duly affixed by the Company.		Execution of deeds by attorney

 

136

The Board may establish an Audit Committee, a Compensation Committee or Remuneration Committee and a Nomination Committee and, if such committees are established, it shall adopt formal written charters for such committees and review and assess the adequacy of such formal written charters on an annual basis. Each of these committees shall be empowered to do all things necessary to exercise the rights of such committee set forth in these Articles and shall have such powers as the Board may delegate pursuant to Article 123(a). Each of the Audit Committee, the Compensation Committee or the Remuneration Committee and the Nomination Committee, if established, shall consist of such number of directors as the Board shall from time to time determine (or such minimum number as may be required from time to time by any Designated Stock Exchange). For so long as any class of Shares are listed on a Designated Stock Exchange, the Compensation Committee or the Remuneration Committee and the Nomination Committee shall be made up of such number of Independent Directors as required from time to time by any rules of the Designated Stock Exchange or otherwise required by applicable law.

Compensation Committee, Remuneration Committee, Nomination Committee

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	37 of 55

 

 

 

137

The Board may establish any committees, regional or local boards or agencies for managing any of the affairs of the Company in any place, and may appoint any persons to be members of such committees, regional or local boards or agencies and may fix their remuneration (either by way of salary or by commission or by conferring the right to participation in the profits of the Company or by a combination of two (2) or more of these modes) and pay the working expenses of any staff employed by them upon the business of the Company. The Board may delegate to any committee, regional or local board or agent any of the powers, authorities and discretions vested in the Board (other than its powers to make calls and forfeit Shares), with power to sub-delegate, and may authorise the members of any regional or local board or any of them to fill any vacancies therein and to act notwithstanding vacancies, and any such appointment or delegation may be upon such terms and subject to such conditions as the Board may think fit, and the Board may remove any person so appointed and may annul or vary any such delegation, but no person dealing in good faith and without notice of any such annulment or variation shall be affected thereby.

Regional or local boards

 

138

The Board may establish and maintain or procure the establishment and maintenance of any contributory or non-contributory pension or superannuation funds or personal pension plans for the benefit of, or give or procure the giving of donations, gratuities, pensions, allowances or emoluments to, any persons who are or were at any time in the employment or service of the Company, or of any company which is a subsidiary of the Company, or is allied or associated with the Company or with any such subsidiary company, or who are or were at any time directors or officers of the Company or of any such other company as aforesaid, and holding or who have held any salaried employment or office in the Company or such other company, and the spouses, widows, widowers, families and dependants of any such persons. The Board may also establish and subsidise or subscribe to any institutions, associations, clubs or funds calculated to be for the benefit of or to advance the interests and well-being of the Company or of any such other company as aforesaid or of any such persons as aforesaid, and may make payments for or towards the insurance of any such persons as aforesaid, and subscribe or guarantee money for charitable or benevolent objects or for any exhibition or for any public, general or useful object. The Board may do any of the matters aforesaid, either alone or in conjunction with any such other company as aforesaid. Any Director holding any such employment or office shall be entitled to participate in and retain for his own benefit any such donation, gratuity, pension, allowance or employment.

Power to establish pension funds

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	38 of 55

 

 

 

AUTHENTICATION OF DOCUMENTS

 

139	(a)	Any Director or the Secretary or other authorised officer of the Company shall have power to authenticate any documents affecting the constitution of the Company and any resolutions passed by the Company or the Board or any committee, and any books, records, documents and accounts relating to the business of the Company, and to certify copies thereof or extracts therefrom as true copies of extracts; and where any books, records, documents or accounts are elsewhere than at the Registered Office or the Head Office, the local manager or such other officer of the Company having the custody thereof shall be deemed to be the authorised officer of the Company as aforesaid.		Power to authenticate
	(b)	A document purporting to be a document so authenticated or a copy of a resolution, or an extract from the minutes of a meeting, of the Company or of the Board or any local board or committee, or of any books, records, documents or accounts or extracts therefrom as aforesaid, and which is certified as aforesaid, shall be conclusive evidence in favour of all persons dealing with the Company upon the faith thereof that the document authenticated (or, if this be authenticated as aforesaid, the matter so authenticated) is authentic or, as the case may be, that such resolution has been duly passed or, as the case may be, that any minute so extracted is a true and accurate record of proceedings at a duly constituted meeting or, as the case may be, that the copies of such books, records, documents or accounts were true copies of their originals or as the case may be, the extracts of such books, records, documents or accounts are true and accurate records of the books, records, documents or accounts from which they were extracted.		Execution of deeds by attorney

 

CAPITALISATION OF RESERVES

 

140	(a)	The Board may resolve to capitalise any sum standing to the credit of any of the Company’s reserve accounts which are available for distribution (including its share premium account and capital redemption reserve fund, subject to the Companies Act) and to appropriate such sums to the holders of Shares on the Register at the close of business on the date of the relevant resolution (or such other date as may be specified therein or determined as provided therein) in the proportions in which such sum would have been divisible amongst them had the same been a distribution of profits by way of Dividend and to apply such sum on their behalf in paying up in full unissued Shares for allotment and distribution credited as fully paid-up to and amongst them in the proportion aforesaid.		Power to capitalise
	(b)	Subject to the Companies Act, whenever such a resolution as aforesaid shall have been passed, the Board shall make all appropriations and applications of the reserves or profits and undivided profits resolved to be capitalised thereby, and attend to all allotments and issues of fully paid Shares, debentures, or other securities and generally shall do all acts and things required to give effect thereto. For the purpose of giving effect to any resolution under this Article, the Board may settle any difficulty which may arise in regard to a capitalisation issue as it thinks fit, and in particular may disregard fractional entitlements or round the same up or down and may determine that cash payments shall be made to any Shareholders in lieu of fractional entitlements or that fractions of such value as the Board may determine may be disregarded in order to adjust the rights of all parties or that fractional entitlements shall be aggregated and sold and the benefit shall accrue to the Company rather than to the Shareholders concerned, and no Shareholders who are affected thereby shall be deemed to be, and they shall be deemed not to be, a separate class of Shareholders by reason only of the exercise of this power. The Board may authorise any person to enter on behalf of all Shareholders interested in a capitalisation issue any agreement with the Company or other(s) providing for such capitalisation and matters in connection therewith and any agreement made under such authority shall be effective and binding upon all concerned. Without limiting the generality of the foregoing, any such agreement may provide for the acceptance by such persons of the Shares, debentures or other securities to be allotted and distributed to them respectively in satisfaction of their claims in respect of the sum so capitalised.		Effect of resolution to capitalise
	(c)	The provisions of paragraph (e) of Article 147 shall apply to the power of the Company to capitalise under this Article as it applies to the grant of election thereunder mutatis mutandis and no Shareholder who may be affected thereby shall be, and they shall be deemed not to be, a separate class of Shareholders by reason only of the exercise of this power.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	39 of 55

 

 

 

DIVIDENDS AND RESERVES

 

141

Subject to the Companies Act and these Articles, the Company in general meeting may declare Dividends in any currency but no Dividends shall exceed the amount recommended by the Board.

Power to declare dividends

 

142	(a)	The Board may subject to Article 143 from time to time pay to the Shareholders such interim Dividends as appear to the Board to be justified by the financial conditions and the profits of the Company and, in particular but without prejudice to the generality of the foregoing, if at any time the share capital of the Company is divided into different classes, the Board may pay such interim Dividends in respect of those Shares in the capital of the Company which confer to the holders thereof deferred or non-preferential rights as well as in respect of those Shares which confer on the holders thereof preferential rights with regard to Dividend and provided that the Board acts bona fide it shall not incur any responsibility to the holders of Shares conferring any preference for any damage that they may suffer by reason of the payment of an interim Dividend on any Shares having deferred or non-preferential rights.
	(b)	The Board may also pay half-yearly or at other suitable intervals to be settled by it any Dividend which may be payable at a fixed rate if the Board is of the opinion that the financial conditions and the profits of the Company justify the payment.
	(c)	The Board may in addition from time to time declare and pay special Dividends of such amounts and on such dates and out of such distributable funds of the Company as it thinks fit, and the provisions of paragraph (a) of this Article as regards the power and exemption from liability of the Board as relate to the declaration and payment of interim Dividends shall apply, mutatis mutandis, to the declaration and payment of any such special Dividends.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	40 of 55

 

 

 

 

143	(a)	No Dividend shall be declared or paid or shall be made otherwise than in accordance with the Companies Act.		Dividends not to be paid out of capital

(b)

Subject to the provisions of the Companies Act but without prejudice to paragraph (a) of this Article, where any asset, business or property is bought by the Company as from a past date (whether such date be before or after the incorporation of the Company) the profits and losses thereof as from such date may at the discretion of the Board in whole or in part be carried to revenue account and treated for all purposes as profits or losses of the Company, and be available for Dividend accordingly. Subject as aforesaid, if any Shares or securities are purchased cum Dividend or interest, such Dividend or interest may at the discretion of the Board be treated as revenue, and it shall not be obligatory to capitalise the same or any part thereof or to apply the same towards reduction of or writing down the book cost of the asset, business or property acquired.

 

(c)

Subject to paragraph (d) of this Article all Dividends and other distributions in respect of Shares shall be stated and discharged, in the case of Shares denominated in any currency, in such currency, provided that the Board may determine in the case of any distribution that Shareholders may elect to receive the same in any other currency selected by the Board, converted at such rate of exchange as the Board may determine.

 

(d)

If, in the opinion of the Board, any Dividend or other distribution in respect of Shares or any other payment to be made by the Company to any Shareholder is of such a small amount as to make payment to that Shareholder in the relevant currency impracticable or unduly expensive either for the Company or the Shareholder then such Dividend or other distribution or other payment may, at the absolute discretion of the Board, be, if this be practicable, converted at such rate of exchange as the Board may determine and paid or made in the currency of the country of the relevant Shareholder (as indicated by the address of such Shareholder on the Register).

 

144

Notice of the declaration of an interim Dividend shall be given in such manner as the Board shall determine.

Notice of interim dividend

 

145

No Dividend or other moneys payable on or in respect of a Share shall bear interest as against the Company.

No interest on dividend

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	41 of 55

 

 

 

146

Whenever the Board or the Company in general meeting has resolved that a Dividend be paid or declared, the Board may further resolve that such Dividend be satisfied wholly or in part by the distribution of specific assets of any kind and in particular of paid up shares, debentures or warrants to subscribe securities of any other company, or in any one or more of such ways, with or without offering any rights to Shareholders to elect to receive such Dividend in cash, and where any difficulty arises in regard to the distribution the Board may settle the same as it thinks expedient, and in particular may disregard fractional entitlements or round the same up or down, and may fix the value for distribution of such specific assets, or any part thereof, and may determine that cash payments shall be made to any Shareholders upon the footing of the value so fixed in order to adjust the rights of all parties and may determine that fractional entitlements shall be aggregated and sold and the benefit shall accrue to the Company rather than to the Shareholders concerned, and may vest any such specific assets in trustees as may seem expedient to the Board and may authorise any person to sign any requisite instruments of transfer and other documents on behalf of all Shareholders interested in the Dividend and such instrument and document shall be effective. The Board may further authorise any person to enter into on behalf of all Shareholders having an interest in any agreement with the Company or other(s) providing for such Dividend and matters in connection therewith and any such agreement made under such authority shall be effective. The Board may resolve that no such assets shall be made available or made to Shareholders with registered addresses in any particular territory or territories being a territory or territories where, in the absence of a registration statement or other special formalities, this would or might, in the opinion of the Board, be unlawful or impracticable or the legality or practicality of which may be time consuming or expensive to ascertain whether in absolute terms or in relation to the value of the holding of Shares of the Shareholder concerned and in any such event the only entitlement of the Shareholders aforesaid shall be to receive cash payments as aforesaid. Shareholders affected as a result of exercise by the Board of its discretion under this Article shall not be, and shall be deemed not to be, a separate class of Shareholders for any purposes whatsoever.

Dividend in specie

 

147	(a)	Whenever the Board or the Company in general meeting has resolved that a Dividend be paid or declared on any class of the share capital of the Company, the Board may further resolve, either:		Scrip dividend

(i)

that such Dividend be satisfied wholly or in part in the form of an allotment of Shares credited as fully paid on the basis that the Shares so allotted shall be of the same class or classes as the class or classes already held by the allottee, provided that the Shareholders entitled thereto will be entitled to elect to receive such Dividend (or part thereof) in cash in lieu of such allotment. In such case, the following provisions shall apply:

 

(A)

the basis of any such allotment shall be determined by the Board;

 

(B)

the Board, after determining the basis of allotment, shall give not less than ten (10) clear days’ notice in writing to the Shareholders of the right of election accorded to them and shall send with such notice forms of election and specify the procedure to be followed and the place at which and the latest date and time by which duly completed forms of election must be lodged in order to be effective;

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	42 of 55

 

 

 

	(C)	the right of election may be exercised in respect of the whole or part of that portion of the Dividend in respect of which the right of election has been accorded; and

(D)

Dividend (or that part of the Dividend to be satisfied by the allotment of Shares as aforesaid) shall not be payable in cash in respect whereof the cash election has not been duly exercised (the “non-elected Shares”) and in lieu and in satisfaction thereof Shares shall be allotted credited as fully paid to the holders of the non-elected Shares on the basis of allotment determined as aforesaid and for such purpose the Board shall capitalise and apply out of any part of the undivided profits of the Company or any part of any of the Company’s reserve accounts (including any special account, or share premium account (if there be any such reserve)) as the Board may determine, a sum equal to the aggregate nominal amount of the Shares to be allotted on such basis and apply the same in paying up in full the appropriate number of Shares for allotment and distribution to and amongst the holders of the non-elected Shares on such basis;

 

or

 

(ii)

that Shareholders entitled to such Dividend will be entitled to elect to receive an allotment of Shares credited as fully paid in lieu of the whole or such part of the Dividend as the Board may think fit on the basis that the Shares so allotted shall be of the same class or classes as the class or classes of Shares already held by the allottee. In such case, the following provisions shall apply:

 

	(A)	the basis of any such allotment shall be determined by the Board;

(B)

the Board, after determining the basis of allotment, shall give not less than ten (10) clear days’ notice in writing to the Shareholders of the right of election accorded to them and shall send with such notice forms of election and specify the procedure to be followed and the place at which and the latest date and time by which duly completed forms of election must be lodged in order to be effective;

 

(C)

the right of election may be exercised in respect of the whole or part of that portion of the Dividend in respect of which the right of election has been accorded; and

 

(D)

the Dividend (or that part of the Dividend in respect of which a right of election has been accorded) shall not be payable on Shares in respect whereof the Share election has been duly exercised (the “elected Shares”) and in lieu thereof Shares shall be allotted credited as fully paid to the holders of the elected Shares on the basis of allotment determined as aforesaid and for such purpose the Board shall capitalise and apply out of any part of the undivided profits of the Company or any part of any of the Company’s reserve accounts (including any special account, contributed surplus account, share premium account and capital redemption reserve fund (if there be any such reserve)) as the Board may determine, a sum equal to the aggregate nominal amount of the Shares to be allotted on such basis and apply the same in paying up in full the appropriate number of Shares for allotment and distribution to and amongst the holders of the elected Shares on such basis.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	43 of 55

 

 

 

	(b)	The Shares allotted pursuant to the provisions of paragraph (a) of this Article shall rank pari passu in all respects with the Shares then in issue and held by the allottee in respect of which they were allotted, save only as regards participation:

(i)

in the relevant Dividend (or the right to receive or to elect to receive an allotment of Shares in lieu thereof as aforesaid); or

 

(ii)

in any other distributions, bonuses or rights paid, made, declared or announced prior to or contemporaneously with the payment or declaration of the relevant Dividend unless, contemporaneously with the announcement by the Board of its proposal to apply the provisions of sub-paragraph (i) or (ii) of paragraph (a) of this Article in relation to the relevant Dividend or contemporaneously with its announcement of the distribution, bonus or rights in question, the Board shall have specified that the Shares to be allotted pursuant to the provisions of paragraph (a) of this Article shall rank for participation in such distribution, bonus or rights.

 

(c)

The Board may do all acts and things considered necessary or expedient to give effect to any capitalisation pursuant to the provisions of paragraph (a) of this Article with full power to the Board to make such provisions as it thinks fit in the case of Shares becoming distributable in fractions (including provisions whereby, in whole or in part, fractional entitlements are aggregated and sold and the net proceeds distributed to those entitled, or are disregarded or rounded up or down or whereby the benefit of fractional entitlements accrues to the Company rather than to the Shareholders concerned), and no Shareholders who will be affected thereby shall be, and they shall be deemed not to be, a separate class of Shareholders by reason only of the exercise of this power. The Board may authorise any person to enter into on behalf of all Shareholders interested, an agreement with the Company providing for such capitalisation and matters incidental thereto and any agreement made pursuant to such authority shall be effective and binding on all concerned.

 

(d)

The Company may upon the recommendation of the Board by Ordinary Resolution resolve in respect of any one particular Dividend that notwithstanding the provisions of paragraph (a) of this Article a Dividend may be satisfied wholly in the form of an allotment of Shares credited as fully paid without offering any right to Shareholders to elect to receive such Dividend in cash in lieu of such allotment.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	44 of 55

 

 

 

(e)

The Board may on any occasion determine that rights of election and the allotment of Shares under paragraph (a) of this Article shall not be made available or made to any Shareholders with registered addresses in any territory where in the absence of a registration statement or other special formalities the circulation of an offer of such rights of election or the allotment of Shares would or might be unlawful or impracticable or the legality or practicability of which may be time consuming or expensive to ascertain whether in absolute terms or in relation to the value of the holding of Shares of the Shareholder concerned, and in such event the provisions aforesaid shall be read and construed subject to such determination and no Shareholder who may be affected by any such determination shall be, and they shall be deemed not to be, a separate class of Shareholders for any purposes whatsoever.

 

(f)

Subject to the Designated Stock Exchange Rules, any resolution declaring a Dividend or other distribution on Shares of any class, whether a resolution of the Company in general meeting or a resolution of the Board, may specify that the same shall be payable or made to the persons registered as the holder of such Shares at the close of business on a particular date or at a particular time on a particular date, and thereupon the Dividend or other distribution shall be payable or made to them in accordance with their respective holdings so registered, but without prejudice to the rights inter se in respect of such Dividend or other distribution between the transferors and transferees of any such Shares. The provisions of this Article shall mutatis mutandis apply to determining the Shareholders entitled to receive notice and vote at any general meeting of the Company, bonuses, capitalisation issues, distributions of realised and unrealised capital profits or other distributable reserves or accounts of the Company and offers or grants made by the Company to the Shareholders.

 

148

The Board may, before recommending any Dividend, set aside out of the profits of the Company such sums as it thinks fit as a reserve or reserves which shall, at the absolute discretion of the Board, be applicable for meeting claims on or liabilities of the Company or contingencies or for equalising Dividends or for any other purpose to which the profits of the Company may be properly applied, and pending such application may, at the like absolute discretion, either be employed in the business of the Company or be invested in such investments (other than Shares) as the Board may from time to time think fit, and so that it shall not be necessary to keep any investments constituting the reserve or reserves separate or distinct from any other investments of the Company. The Board may also without placing the same to reserve, carry forward any profits which it may think prudent not to distribute by way of Dividend.

Reserves

 

149

Unless and to the extent that the rights attached to any Shares or the terms of issue thereof otherwise provide, all Dividends shall (as regards any Shares not fully paid throughout the period in respect of which the Dividend is paid) be apportioned and paid pro rata according to the amounts paid or credited as paid on the Shares during any portion or portions of the period in respect of which the Dividend is paid. For the purposes of this Article no amount paid on a Share in advance of calls pursuant to Article 35 shall be treated as paid on the Share.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	45 of 55

 

 

 

150	(a)	The Board may retain any Dividends or other moneys payable on or in respect of a Share upon which the Company has a lien, and may apply the same in or towards satisfaction of the debts, liabilities or engagements in respect of which the lien exists.		Retention of dividends, etc.

(b)

The Board may deduct from any Dividend or other money payable to any Shareholder all sums of money (if any) presently payable by him to the Company on account of calls, instalments or otherwise.

Deduction of debts

 

151

Any general meeting sanctioning a Dividend may make a call on the Shareholders of such amount as the meeting fixes, but so that the call on each Shareholder shall not exceed the Dividend payable to him, and so that the call shall be made payable at the same time as the Dividend, and the Dividend may, if so arranged between the Company and the Shareholder, be set off against the call.

Dividend and call together

 

152

A transfer of Shares shall not, as against the Company but without prejudice to the rights of the transferor and transferee inter se, pass the right to any Dividend or bonus declared thereon before the registration of the transfer.

Effect of transfer

 

153

If two (2) or more persons are registered as joint holders of any Share, any one of such persons may give effectual receipts for any Dividends and other moneys payable and bonuses, rights and other distributions in respect of such Shares.

Receipt for dividends by joint holders of share

 

154

Unless otherwise directed by the Board, any Dividend or other moneys payable or bonuses, rights or other distributions in respect of any Share may be paid or satisfied by cheque or warrant or certificate or other documents or evidence of title sent through the post to the registered address of the Shareholder entitled, or, in the case of joint holders, to the registered address of that one whose name stands first in the Register in respect of the joint holding or to such person and to such address as the holder or joint holders may in writing direct. Every cheque, warrant, certificate or other document or evidence of title so sent shall be made payable to the order of the person to whom it is sent or, in the case of certificates or other documents or evidence of title as aforesaid, in favour of the Shareholder(s) entitled thereto, and the payment on any such cheque or warrant by the banker upon whom it is drawn shall operate as a good discharge to the Company in respect of the Dividend and/or other moneys represented thereby, notwithstanding that it may subsequently appear that the same has been stolen or that any endorsement thereon has been forged. Every such cheque, warrant, certificate or other document or evidence of title as aforesaid shall be sent at the risk of the person entitled to the Dividend, money, bonus, rights and other distributions represented thereby.

Payment by post

 

155

All Dividends, bonuses or other distributions or the proceeds of the realisation of any of the foregoing unclaimed for one (1) year after having been declared by the Company until claimed and, notwithstanding any entry in any books of the Company may be invested or otherwise made use of by the Board for the benefit of the Company or otherwise howsoever, and the Company shall not be constituted a trustee in respect thereof. All Dividends, bonuses or other distributions or the proceeds of the realisation of any of the foregoing unclaimed for six (6) years after having been declared may be forfeited by the Board and, upon such forfeiture, shall revert to the Company and, in the case where any of the same are securities of the Company, may be re-allotted or re-issued for such consideration as the Board thinks fit and the proceeds thereof shall accrue to the benefit of the Company absolutely.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	46 of 55

 

 

 

RECORD DATE

 

156

(a)

For the purpose of determining Shareholders entitled to notice of, or to vote at any meeting of Shareholders or any adjournment thereof, or Shareholders entitled to receive payment of any dividend or other distribution, or in order to make a determination of Shareholders for any other purpose, the Directors may provide that the Register shall be closed for transfers for a stated period which shall not in any case exceed sixty (60) clear days. If the Register shall be so closed for the purpose of determining those Shareholders that are entitled to receive notice of, attend or vote at a meeting of Shareholders, the Register shall be so closed for at least ten (10) clear days immediately preceding such meeting and the record date for such determination shall be the date of the closure of the Register.

Record Date

 

(b)

In lieu of, or apart from, closing the Register, the Directors may fix in advance or arrears a date as the record date for any such determination of Shareholders entitled to notice of, or to vote at any meeting of the Shareholders or any adjournment thereof, or for the purpose of determining the Shareholders entitled to receive payment of any dividend or other distribution, or in order to make a determination of Shareholders for any other purpose.

 

(c)

If the Register is not so closed and no record date is fixed for the determination of Shareholders entitled to notice of, or to vote at, a meeting of Shareholders or Shareholders entitled to receive payment of a dividend or other distribution, the date on which notice of the meeting is sent or posted or the date on which the resolution of the Directors resolving to pay such dividend or other distribution is passed, as the case may be, shall be the record date for such determination of Shareholders. When a determination of Shareholders entitled to vote at any meeting of Shareholders has been made as provided in this Article, such determination shall apply to any adjournment thereof.

 

ANNUAL RETURNS

 

157

The Board shall make or cause to be made such annual or other returns or filings as may be required to be made in accordance with the Companies Act.

Annual Returns

 

ACCOUNTS

 

158

The Board shall cause proper books of account to be kept of the sums of money received and expended by the Company, and the matters in respect of which such receipts and expenditure take place; and of the assets and liabilities of the Company and of all other matters required by the Companies Act necessary to give a true and fair view of the state of the Company’s affairs and to show and explain its transactions. The financial year end of the Company shall be 31 December in each calendar year or as otherwise determined by the Board.

Accounts to be kept

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	47 of 55

 

 

 

159	The books of account shall be kept at the Head Office or at such other place or places as the Board thinks fit and shall always be open to the inspection of the Directors.		Where accounts to be kept
160	No Shareholder (not being a Director) or other person shall have any right of inspecting any account or book or document of the Company except as conferred by the Companies Act or ordered by a court of competent jurisdiction or authorised by the Board or the Company in general meeting.		Inspection by shareholders

 

161	(a)	The Board shall from time to time cause to be prepared and laid before the Company at its annual general meeting profit and loss accounts and balance sheets of the Company and such other reports and documents as may be required by law and the Designated Stock Exchange Rules. The accounts of the Company shall be prepared and audited based on the generally accepted accounting principles, the International Accounting Standards, or such other standards as may be permitted by the Designated Stock Exchange.		Annual profit and loss account and balance sheet
	(b)	Subject to paragraph (c) below, every balance sheet of the Company shall be signed on behalf of the Board by two (2) of the Directors and a copy of every balance sheet (including every document required by law to be comprised therein or annexed thereto) and profit and loss account which is to be laid before the Company at its annual general meeting held in accordance with these Article, together with a copy of the Directors’ report and a copy of the Auditors’ report thereon, shall, not less than ten (10) clear days before the date of the meeting be delivered or sent by post to every Shareholder and every Debenture Holder of the Company and every other person entitled to receive notices of general meetings of the Company under the provisions of these Articles, provided that this Article shall not require a copy of those documents to be sent to any person of whose address the Company is not aware or to more than one of the joint holders of any Shares or Debentures, but any Shareholder or Debenture Holder to whom a copy of those documents has not been sent shall be entitled to receive a copy free of charge on application at the Head Office or the Registered Office. If all or any of the Shares or Debentures or other securities of the Company shall for the time being be (with the consent of the Company) listed or dealt in on any stock exchange or market, there shall be forwarded to such stock exchange or market such number of copies of such documents as may for the time being be required under its regulations or practice.		Annual report of Directors and balance sheet to be sent to shareholders

 

(c)

Subject to the Designated Stock Exchange Rules, the Company may send summarised financial statements to Shareholders who has, in accordance with the Designated Stock Exchange Rules, consented and elected to receive summarised financial statements instead of the full financial statements. The summarised financial statements must be accompanied by any other documents as may be required under the Designated Stock Exchange Rules and must be sent to the Shareholders not less than ten (10) clear days before the general meeting to those Shareholders that have consented and elected to receive the summarised financial statements.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	48 of 55

 

 

 

Auditors

 

162	(a)	Subject to applicable law and rules of the Designated Stock Exchange, the Board shall appoint an Auditor to audit the accounts of the Company and such Auditor shall hold office until the Board appoints another Auditor. Such Auditor may be a Shareholder but no Director or officer or employee of the Company shall, during his continuance in office, be eligible to act as an Auditor. The remuneration of the Auditor shall be fixed by the Board. If the office of Auditor becomes vacant by the resignation or death of the Auditor, or by his becoming incapable of acting by reason of illness or other disability at a time when his services are required, the Directors shall fill the vacancy and determine the remuneration of such Auditor.		Appointment of Auditors
	(b)	The Shareholders may by Ordinary Resolution appoint one or more firms of Auditors to hold office until the conclusion of the next annual general meeting on such terms and with such duties as may be agreed with the Board, but if an appointment is not made, the Auditors in office shall continue in office until a successor is appointed. A Director, officer or employee of any such Director, officer or employee shall not be appointed Auditors of the Company. The Board may fill any casual vacancy in the office of Auditors, but while any such vacancy continues the surviving or continuing Auditors (if any) may act. The remuneration of the Auditors shall be fixed by the Shareholders in general meeting by Ordinary Resolution or in such manner as the Shareholders may determine.
	(c)	The Board may remove the Auditor at any time before the expiration of his term of office and may by resolution appoint another Auditor in his stead.
163	The Auditors of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the Directors and officers of the Company such information as may be necessary for the performance of his or their duties. Subject to the Companies Act, the Auditors shall audit every balance sheet and profit and loss account of the Company in each year and prepare an Auditors’ report thereon to be annexed thereto. Such report shall be laid before the Company in the annual general meeting.			Auditors to have right of access to books and accounts
164	No person other than the retiring Auditors shall be appointed as Auditors at an annual general meeting unless notice of an intention to nominate that person to the office of Auditors has been given to the Company not less than fourteen (14) clear days before the annual general meeting, and the Company shall send a copy of any such notice to the retiring Auditors and shall give notice thereof to the Shareholders not less than seven (7) days before the annual general meeting provided that the above requirement for sending a copy of such notice to the retiring Auditors may be waived by notice in writing by the retiring Auditors to the Secretary.			Appointment of Auditors other than retiring Auditors

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	49 of 55

 

 

 

165	All acts done by any person acting as Auditors shall, as regards all persons dealing in good faith with the Company, be valid, notwithstanding that there was some defect in their appointment or that they were at the time of their appointment not qualified for appointment or subsequently became disqualified.			Defect of appointment

Notices

 

166

(a)

Except where otherwise expressly stated, any notice or document to be given to or by any person pursuant to these Articles shall be in writing or, to the extent permitted by the Companies Act and the Designated Stock Exchange Rules from time to time and subject to this Article, contained in an electronic communication. A notice calling a meeting of the Board need not be in writing.

Service of notices

 

	(b)	Except where otherwise expressly stated, any notice or document to be given to or by any person pursuant to these Articles may be served on or delivered to any Shareholder either personally or by sending it through the post in a prepaid envelope or wrapper addressed to such Shareholder at his registered address as appearing in the register or by leaving it at that address addressed to the Shareholder or by any other means authorised in writing by the Shareholder concerned or (other than share certificate) by publishing it by way of advertisement in the appropriate newspapers in accordance with the requirements of the Designated Stock Exchange. In case of joint holders of a share, all notices shall be given to that one of the joint holders whose name stands first in the register and notice so given shall be sufficient notice to all the joint holders. Without limiting the generality of the foregoing but subject to the Companies Act and the Designated Stock Exchange Rules, a notice or document may be served or delivered by the Company to any Shareholder by electronic means to such address as may from time to time be authorised by the Shareholder concerned or by publishing it on a website and notifying the Shareholder concerned that it has been so published.
	(c)	Any such notice or document may be served or delivered by the Company by reference to the register as it stands at any time not more than fifteen (15) days before the date of service or delivery. No change in the register after that time shall invalidate that service or delivery. Where any notice or document is served or delivered to any person in respect of a share in accordance with these Articles, no person deriving any title or interest in that share shall be entitled to any further service or delivery of that notice or document.
	(d)	Any notice or document required to be sent to or served upon the Company, or upon any officer of the Company, may be sent or served by leaving the same or sending it through the post in a prepaid envelope or wrapper addressed to the Company or to such officer at the Head Office or Registered Office.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	50 of 55

 

 

 

	(e)	The Board may from time to time specify the form and manner in which a notice may be given to the Company by electronic means, including one or more addresses for the receipt of an electronic communication, and may prescribe such procedures as they think fit for verifying the authenticity or integrity of any such electronic communication. Any notice may be given to the Company by electronic means only if it is given in accordance with the requirements specified by the Board.
167	(a)	Any Shareholder who fails (and, where a Share is held by joint holders, where the first joint holder named on the register fails) to supply his registered address or a correct registered address to the Company for service of notices and documents on him shall not (and where a Share is held by joint holders, none of the other joint holders whether or not they have supplied a registered address shall) be entitled to service of any notice or documents by the Company and any notice or document which is otherwise required to be served on him may, if the Board in its absolute discretion so elects (and subject to them re-electing otherwise from time to time), be served, in the case of notices, by displaying a copy of such notice conspicuously at the Registered Office and the Head Office or, if the Board sees fit, by advertisement in the appropriate newspapers in accordance with the requirements of the Designated Stock Exchange, and, in the case of documents, by posting up a notice conspicuously at the Registered Office and the Head Office addressed to such Shareholder which notice shall state the address at which he served in the manner so described which shall be sufficient service as regards Shareholders with no registered or incorrect addresses, provided that nothing in this paragraph (a) shall be construed as requiring the Company to serve any notice or document on any Shareholder with no or an incorrect registered address for the service of notice or document on him or on any Shareholder other than the first named on the register of members of the Company.
	(b)	If on three (3) consecutive occasions notices or other documents have been sent through the post to any Shareholder (or, in the case of joint holders of a share, the first holder named on the register) at his registered address but have been returned undelivered, such Shareholder (and, in the case of joint holders of a Share, all other joint holders of the share) shall not thereafter be entitled to receive or be served (save as the Board may elect otherwise pursuant to paragraph (a) of this Article) and shall be deemed to have waived the service of notices and other documents from the Company until he shall have communicated with the Company and supplied in writing a new registered address for the service of notices on him.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	51 of 55

 

 

 

168

Any notice or other document, if sent by mail, postage prepaid, shall be deemed to have been served or delivered on the day following that on which the letter, envelope, or wrapper containing the same is put into the post. In proving such service it shall be sufficient to prove that the letter, envelope or wrapper containing the notice or document was properly addressed and put into the post as prepaid mail. Any notice or document not sent by post but left by the Company at a registered address shall be deemed to have been served or delivered on the day it was so left. Any notice or document, if sent by electronic means (including through any relevant system), shall be deemed to have been given on the day following that on which the electronic communication was sent by or on behalf of the Company. Any notice or document served or delivered by the Company by any other means authorised in writing by the Shareholder concerned shall be deemed to have been served when the Company has carried out the action it has been authorised to take for that purpose. Any notice or other document published by way of advertisement or on a website shall be deemed to have been served or delivered on the day it was so published.

When notice deemed to be served

 

169	A notice or document may be given by the Company to the person entitled to a Share in consequence of the death, mental disorder, bankruptcy or liquidation of a Shareholder by sending it through the post in a prepaid envelope or wrapper addressed to him by name, or by the title of representative of the deceased, the trustee of the bankrupt or the liquidator of the Shareholder, or by any like description, at the address, if any, supplied for the purpose by the person claiming to be so entitled, or (until such an address has been so supplied) by giving the notice or document in any manner in which the same might have been given if the death, metal disorder, bankruptcy or winding up had not occurred.		Service of notice to persons entitled on death, mental disorder or bankruptcy
170	Any person who by operation of law, transfer or other means whatsoever shall become entitled to any Share shall be bound by every notice in respect of such share which prior to his name and address being entered on the register shall have been duly served to the person from whom he derives his title to such share.		Transferee to be bound by prior notices
171	Any notice or document delivered or sent by post to, or left at the registered address of any Shareholder in pursuance of these Articles, shall notwithstanding that such Shareholder be then deceased, bankrupt or wound up and whether or not the Company has notice of his death, bankruptcy or winding up, be deemed to have duly served in respect of any registered Shares whether held solely or jointly with other persons by such Shareholder until some other person be registered in his stead as the holder or joint holder thereof, and such service shall for all purposes of these Articles be deemed a sufficient service of such notice or document on his personal representatives and all persons (if any) jointly interested with him in any such Shares.		Notice valid though shareholder deceased, bankrupt
172	The signature to any notice or document to be given by the Company may be written or printed.		How notice to be signed

 

Information

 

173

No Shareholder (not being a Director) shall be entitled to require discovery of or any information respecting any detail of the Company’s trading or any matter which is or may be in the nature of a trade secret, mystery of trade or secret process which may relate to the conduct of the business of the Company which in the opinion of the Board will be inexpedient in the interests of the Shareholders of the Company to communicate to the public.

Shareholders not entitled to information

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	52 of 55

 

 

 

Winding Up

 

174	Subject to the Companies Act, a resolution that the Company be wound up by the Court or be wound up voluntarily shall be passed by way of a Special Resolution. The Board shall have power in the name and on behalf of the Company to present a petition to the Court for the Company to be wound up.		Modes of winding up
175	If the Company shall be wound up, the surplus assets remaining after payment to all creditors shall be divided among the Shareholders in proportion to the capital paid up on the Shares held by them respectively, and if such surplus assets shall be insufficient to repay the whole of the paid up capital, they shall be distributed, subject to the rights of any Shares which may be issued on special terms and conditions, so that, as nearly as may be, the losses shall be borne by the Shareholders in proportion to the capital paid on the Shares held by them respectively. This Article is without prejudice to the rights of the holders of Shares issued upon special terms and conditions.		Distribution of assets in winding up
176	If the Company shall be wound up (in whatever manner) the liquidator may, with the sanction of a Special Resolution and any other sanction required by the Companies Act, divide among the Shareholders in specie or kind the whole or any part of the assets of the Company whether the assets shall consist of property of one kind or shall consist of properties of different kinds and the liquidator may, for such purpose, set such value as he deems fair upon any one or more class or classes of property to be divided as aforesaid and may determine how such division shall be carried out as between the Shareholders or different classes of Shareholders and the Shareholders within each class. The liquidator may, with the like sanction, vest any part of the assets in trustees upon such trusts for the benefit of Shareholders as the liquidator, with the like sanction, shall think fit, but so that no Shareholder shall be compelled to accept any Shares or other assets upon which there is a liability.		Assets may be distributed in specie

 

Indemnity

 

177

The Directors, alternate Directors, Secretary and other officers for the time being of the Company and the trustees (if any) for the time being acting in relation to any of the affairs of the Company, and their respective executors or administrators, shall be indemnified and secured harmless out of the assets of the Company from and against all actions, costs, charges, losses, damages and expenses which they or any of them, their or any of their executors or administrators, shall or may incur or sustain by reason of any act done, concurred in or omitted in or about the execution of their duty or supposed duty in their respective offices or trusts, except such (if any) as they shall incur or sustain through their own dishonesty, wilful default or fraud, and none of them shall be answerable for the acts, receipts, neglects or defaults of any other of them, or for joining in any receipt for the sake of conformity, or for any bankers or other persons with whom any moneys or effects of the Company shall be lodged or deposited for safe custody, or for the insufficiency or deficiency of any security upon which any moneys of the Company shall be placed out or invested, or for any other loss, misfortune or damage which may arise in the execution of their respective offices or trusts, or in relation thereto, except as the same shall happen by or through their own dishonesty, wilful default or fraud. The Company may take out and pay the premium and other moneys for the maintenance of insurance, bonds and other instruments for the benefit either of the Company or the Directors (and/or other officers) or any of them to indemnify the Company and/or Directors (and/or other officers) named therein for this purpose against any loss, damage, liability and claim which they may suffer or sustain in connection with any breach by the Directors (and/or other officers) or any of them of their duties to the Company.

Indemnity

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	53 of 55

 

 

 

Untraceable Shareholders

 

178

The Company may exercise the power to cease sending cheques for Dividend entitlements or Dividend warrants by post if such cheques or warrants remain uncashed on two (2) consecutive occasions or after the first occasion on which such a cheque or warrant is returned undelivered.

Company ceases sending dividend warrants etc.

 

179

(a)

The Company shall have the power to sell, in such manner as the Board thinks fit, any Shares of a Shareholder who is untraceable, but no such sale shall be made unless:

Company may sell shares of untraceable shareholders

 

		(i)	during the period of twelve (12) years prior to the date of the advertisements referred to in sub-paragraph (ii) below (or, if published more than once, the first thereof) at least three (3) Dividends or other distributions in respect of the Shares in question have become payable or been made and no Dividend or other distribution in respect of the Shares during that period has been claimed;
		(ii)	the Company has caused an advertisement to be inserted in newspapers of its intention to sell such Shares and a period of three (3) months has elapsed since the date of such advertisement (or, if published more than once, the first thereof); and
		(iii)	the Company has not at any time during the said periods of twelve (12) years and three (3) months received any indication of the existence of the holder of such Shares or of a person entitled to such Shares by death, bankruptcy or operation of law.

 

(b)

To give effect to any such sale the Board may authorise any person to transfer the said Shares and the instrument of transfer signed or otherwise executed by or on behalf of such person shall be as effective as if it had been executed by the registered holder or the person entitled by transmission to such Shares, and the purchaser shall not be bound to see to the application of the purchase money nor shall his title to the Shares be affected by any irregularity or invalidity in the proceedings relating to the sale. The net proceeds of the sale will belong to the Company and upon receipt by the Company of such proceeds it shall become indebted to the former Shareholder for an amount equal to such net proceeds. Notwithstanding any entries made by the Company in any of its books or otherwise howsoever, no trusts shall be created in respect of such debt and no interest shall be payable in respect of it and the Company shall not be required to account for any money earned from the net proceeds which may be employed in the business of the Company or as it thinks fit. Any sale under this Article shall be valid and effective notwithstanding that the Shareholder holding the Shares sold is dead, bankrupt, wound up or otherwise under any legal disability or incapacity.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	54 of 55

 

 

 

Destruction of Documents

 

180	The Company may destroy:			Destruction of documents
	(a)	any share certificate which has been cancelled at any time after the expiry of one year from the date of such cancellation;
	(b)	any dividend mandate or any variation or cancellation thereof or any notification of change of name or address at any time after the expiry of two (2) years from the date on which such mandate, variation, cancellation or notification was recorded by the Company;
	(c)	any instrument of transfer of Shares which has been registered at any time after the expiry of six (6) years from the date of registration;
	(d)	any other document, on the basis of which any entry in the Register is made, at any time after the expiry of six (6) years from the date on which an entry in the Register was first made in respect of it;
		and it shall conclusively be presumed in favour of the Company that every Share certificate so destroyed was a valid certificate duly and properly cancelled and that every instrument of transfer so destroyed was a valid and effective instrument duly and properly registered and that every other document destroyed hereunder was a valid and effective document in accordance with the recorded particulars thereof in the books or records of the Company provided always that:

 

		(i)	the foregoing provisions of this Article shall apply only to the destruction of a document in good faith and without express notice to the Company that the preservation of such document was relevant to a claim;
		(ii)	nothing contained in this Article shall be construed as imposing upon the Company any liability in respect of the destruction of any such document earlier than as aforesaid or in any case where the conditions of proviso (i) above are not fulfilled; and
		(iii)	references in this Article to the destruction of any document include reference to its disposal in any manner.

 

		Filed: 24-Apr-2024 13:25 EST Auth Code: K54240655934
	www.verify.gov.ky File#: 379468	55 of 55

 

 

Exhibit 2.3

 

Description of Securities

 

General

 

Our share capital comprises ordinary shares of par value $0.0000625 each (“Ordinary Shares”) are listed and traded on the Nasdaq Capital Market. All of our outstanding Ordinary Shares are fully paid and non-assessable. Certificates representing the Ordinary Shares are issued in registered form. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Ordinary Shares. We may not issue shares to bearer.

 

Dividends

 

Subject to the Companies Act and our Memorandum and Articles of Association, our Company in general meeting may declare dividends in any currency to be paid to the members but no dividend shall be declared in excess of the amount recommended by our board of directors.

 

Except in so far as the rights attaching to, or the terms of issue of, any share may otherwise provide:

 

(i) all dividends shall be declared and paid according to the amounts paid up on the shares in respect of which the dividend is paid, although no amount paid up on a share in advance of calls shall for this purpose be treated as paid up on the share;

 

(ii) all dividends shall be apportioned and paid pro rata in accordance with the amount paid up on the shares during any portion(s) of the period in respect of which the dividend is paid; and

 

(iii) our board of directors may deduct from any dividend or other monies payable to any member all sums of money (if any) presently payable by him to our Company on account of calls, instalments or otherwise.

 

Where our board of directors or our Company in general meeting has resolved that a dividend should be paid or declared, our board of directors may resolve:

 

(aa) that such dividend be satisfied wholly or in part in the form of an allotment of shares credited as fully paid up, provided that the members entitled to such dividend will be entitled to elect to receive such dividend (or part thereof) in cash in lieu of such allotment; or

 

(bb) that the members entitled to such dividend will be entitled to elect to receive an allotment of shares credited as fully paid up in lieu of the whole or such part of the dividend as our board of directors may think fit.

 

Upon the recommendation of our board of directors, our Company may by ordinary resolution in respect of any one particular dividend of our Company determine that it may be satisfied wholly in the form of an allotment of shares credited as fully paid up without offering any right to members to elect to receive such dividend in cash in lieu of such allotment.

 

Any dividend, bonus, or other sum payable in cash to the holder of shares may be paid by cheque or warrant sent through the post. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and shall be sent at the holder’s or joint holders’ risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to our Company. Any one of two or more joint holders may give effectual receipts for any dividends or other monies payable or property distributable in respect of the shares held by such joint holders.

 

Whenever our board of directors or our Company in general meeting has resolved that a dividend be paid or declared, our board of directors may further resolve that such dividend be satisfied wholly or in part by the distribution of specific assets of any kind.

 

Our board of directors may, if it thinks fit, receive from any member willing to advance the same, and either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced may pay interest at such rate (if any) not exceeding 20% per annum, as our board of directors may decide, but a payment in advance of a call shall not entitle the member to receive any dividend or to exercise any other rights or privileges as a member in respect of the share or the due portion of the shares upon which payment has been advanced by such member before it is called up.

 

 

 

 

All dividends, bonuses, or other distributions unclaimed for one year after having been declared may be invested or otherwise used by our board of directors for the benefit of our Company until claimed and our Company shall not be constituted a trustee in respect thereof. All dividends, bonuses, or other distributions unclaimed for six years after having been declared may be forfeited by our board of directors and, upon such forfeiture, shall revert to our Company.

 

No dividend or other monies payable by our Company on or in respect of any share shall bear interest against our Company.

 

Our Company may exercise the power to cease sending cheques for dividend entitlements or dividend warrants by post if such cheques or warrants remain uncashed on two consecutive occasions or after the first occasion on which such a cheque or warrant is returned undelivered.

 

Voting Rights

 

Subject to any special rights, restrictions or privileges as to voting for the time being attached to any class or classes of shares at any general meeting: (a) on a poll every member present in person or by proxy or, in the case of a member being a corporation, by our duly authorized representative shall have one vote for every share which is fully paid or credited as fully paid registered in his name in the register of members of our Company but so that no amount paid up or credited as paid up on a share in advance of calls or instalments is treated for this purpose as paid up on the share; and (b) on a show of hands every member who is present in person (or, in the case of a member being a corporation, by our duly authorized representative) or by proxy shall have one vote. Where more than one proxy is appointed by a member which is a Clearing House (as defined in the Articles) (or its nominee(s)) or a central depository house (or its nominee(s)), each such proxy shall have one vote on a show of hands. On a poll, a member entitled to more than one vote need not use all his votes or cast all the votes he does use in the same way.

 

Transfer of Ordinary Shares

 

Subject to the Companies Act and our Articles of Association, all transfers of shares shall be effected by an instrument of transfer in the usual or common form or in such other form as our board of directors may approve and may be under hand or, if the transferor or transferee is a Clearing House (as defined in the Articles) (or its nominee(s)) or a central depository house (or its nominee(s)), under hand or by machine imprinted signature, or by such other manner of execution as our board of directors may approve from time to time.

 

Execution of the instrument of transfer shall be by or on behalf of the transferor and the transferee, provided that our board of directors may dispense with the execution of the instrument of transfer by the transferor or transferee or accept mechanically executed transfers. The transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the register of members of our Company in respect of that share.

 

Our board of directors may, in our absolute discretion, at any time and from time to time remove any share on the principal register to any branch register or any share on any branch register to the principal register or any other branch register. Unless our board of directors otherwise agrees, no shares on the principal register shall be removed to any branch register nor shall shares on any branch register be removed to the principal register or any other branch register. All removals and other documents of title shall be lodged for registration and registered, in the case of shares on any branch register, at the registered office and, in the case of shares on the principal register, at the place at which the principal register is located.

 

Our board of directors may, in our absolute discretion, decline to register a transfer of any share (not being a fully paid up share) to a person of whom it does not approve or on which our Company has a lien. It may also decline to register a transfer of any share issued under any share option scheme upon which a restriction on transfer subsists or a transfer of any share to more than four joint holders.

 

Our board of directors may decline to recognize any instrument of transfer unless a certain fee, up to such maximum sum as Nasdaq may determine to be payable, is paid to our Company, the instrument of transfer is properly stamped (if applicable), is in respect of only one class of share and is lodged at our registered office or the place at which the principal register is located accompanied by the relevant share certificate(s) and such other evidence as our board of directors may reasonably require is provided to show the right of the transferor to make the transfer (and if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do).

 

2

 

 

The registration of transfers of shares or of any class of shares may, after compliance with any notice requirement of Nasdaq, be suspended at such times and for such periods (not exceeding in the whole thirty days in any year) as our board of directors may determine.

 

Fully paid shares shall be free from any restriction on transfer (except when permitted by Nasdaq) and shall also be free from all liens.

 

Procedures on liquidation

 

A resolution that our Company be wound up by the court or be wound up voluntarily shall be a special resolution of our shareholders.

 

Subject to any special rights, privileges, or restrictions as to the distribution of available surplus assets on liquidation for the time being attached to any class or classes of shares:

 

(i) if our Company is wound up, the surplus assets remaining after payment to all creditors shall be divided among the members in proportion to the capital paid up on the shares held by them respectively; and

 

(ii) if our Company is wound up and the surplus assets available for distribution among the members are insufficient to repay the whole of the paid-up capital, such assets shall be distributed, subject to the rights of any shares which may be issued on special terms and conditions, so that, as nearly as may be, the losses shall be borne by the members in proportion to the capital paid up on the shares held by them, respectively.

 

If our Company is wound up (whether the liquidation is voluntary or compelled by the court), the liquidator may, with the sanction of a special resolution and any other sanction required by the Companies Act, divide among the members in specie or kind the whole or any part of the assets of our Company, whether the assets consist of property of one kind or different kinds, and the liquidator may, for such purpose, set such value as he deems fair upon any one or more class or classes of property to be so divided and may determine how such division shall be carried out as between the members or different classes of members and the members within each class. The liquidator may, with the like sanction, vest any part of the assets in trustees upon such trusts for the benefit of members as the liquidator thinks fit, but so that no member shall be compelled to accept any shares or other property upon which there is a liability.

 

Calls on Ordinary Shares and Forfeiture of Ordinary Shares

 

Subject to these Articles and to the terms of allotment, our board of directors may, from time to time, make such calls as it thinks fit upon the members in respect of any monies unpaid on the shares held by them respectively (whether on account of the nominal value of the shares or by way of premium) and not by the conditions of allotment of such shares made payable at fixed times. A call may be made payable either in one sum or by instalments. If the sum payable in respect of any call or instalment is not paid on or before the day appointed for payment thereof, the person or persons from whom the sum is due shall pay interest on the same at such rate not exceeding 20% per annum as our board of directors shall fix from the day appointed for payment to the time of actual payment, but our board of directors may waive payment of such interest wholly or in part. Our board of directors may, if it thinks fit, receive from any member willing to advance the same, either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced our Company may pay interest at such rate (if any) not exceeding 20% per annum as our board of directors may decide.

 

If a member fails to pay any call or instalment of a call on the day appointed for payment, our board of directors may, for so long as any part of the call or instalment remains unpaid, serve not less than 14 days’ notice on the member requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued and which may still accrue up to the date of actual payment. The notice shall name a further day (not earlier than the expiration of 14 days from the date of the notice) on or before which the payment required by the notice is to be made and shall also name the place where payment is to be made. The notice shall also state that, in the event of non-payment at or before the appointed time, the shares in respect of which the call was made will be liable to be forfeited.

 

If the requirements of any such notice are not complied with, any share in respect of which the notice has been given may at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of our board of directors to that effect. Such forfeiture will include all dividends and bonuses declared in respect of the forfeited share and not actually paid before the forfeiture.

 

3

 

 

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, nevertheless, remain liable to pay to our Company all monies which, at the date of forfeiture, were payable by him to our Company in respect of the shares together with (if our board of directors shall in our discretion so require) interest thereon from the date of forfeiture until payment at such rate not exceeding 20% per annum as our board of directors may prescribe.

 

Redemption of Ordinary Shares

 

Subject to the Companies Act, our Articles of Association, and, where applicable, the Nasdaq listing rules or any other law or so far as not prohibited by any law and subject to any rights conferred on the holders of any class of Shares, any power of our Company to purchase or otherwise acquire all or any of its own Shares (which expression as used in this Article includes redeemable Shares) be exercisable by our board of directors in such manner, upon such terms and subject to such conditions as it thinks fit.

 

Subject to the Companies Act, our Articles of Association, and to any special rights conferred on the holders of any Shares or attaching to any class of Shares, Shares may be issued on the terms that they may, at the option of our Company or the holders thereof, be liable to be redeemed on such terms and in such manner, including out of capital, as our board of directors may deem fit.

 

Variations of Rights of Shares

 

Subject to the Companies Act and without prejudice to our Articles of Association, if at any time the share capital of our Company is divided into different classes of shares, all or any of the special rights attached to any class of shares may (unless otherwise provided for by the terms of issue of the shares of that class) be varied, modified or abrogated with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of that class. The provisions of the Articles relating to general meetings shall mutatis mutandis apply to every such separate general meeting, but so that the necessary quorum (whether at a separate general meeting or at its adjourned meeting) shall be not less than a person or persons together holding (or, in the case of a member being a corporation, by our duly authorized representative) or representing by proxy not less than one-third in nominal value of the issued shares of that class. Every holder of shares of the class shall be entitled on a poll to one vote for every such share held by him, and any holder of shares of the class present in person or by proxy may demand a poll.

 

Any special rights conferred upon the holders of any shares or class of shares shall not, unless otherwise expressly provided in the rights attaching to the terms of issue of such shares, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

 

General Meetings of Shareholders

 

Our Company must hold an annual general meeting each fiscal year other than the fiscal year of our Company’s adoption of our Articles of Association.

 

Extraordinary general meetings may be convened on the requisition of one or more members holding, at the date of deposit of the requisition, not less than one tenth of the paid-up capital of our Company having the right of voting at general meetings. Such requisition shall be made in writing to our board of directors or the secretary of our Company for the purpose of requiring an extraordinary general meeting to be called by our board of directors for the transaction of any business specified in such requisition. Such meeting shall be held within two months after the deposit of such requisition. If within 21 days of such deposit, our board of directors fails to proceed to convene such meeting, the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of our board of directors shall be reimbursed to the requisitionist(s) by our Company.

 

Every general meeting of our Company shall be called by at least 10 clear days’ notice in writing. The notice shall be exclusive of the day on which it is served or deemed to be served and of the day for which it is given, and must specify the time, place and agenda of the meeting and particulars of the resolution(s) to be considered at that meeting and the general nature of that business.

 

Although a meeting of our Company may be called by shorter notice than as specified above, such meeting may be deemed to have been duly called if it is so agreed:

 

(i) in the case of an annual general meeting, by all members of our Company entitled to attend and vote thereat; and

 

4

 

 

(ii) in the case of any other meeting, by a majority in number of the members having a right to attend and vote at the meeting holding not less than 95% of the total voting rights at the meetings of all our shareholders.

 

All business transacted at an extraordinary general meeting shall be deemed special business. All business shall also be deemed special business where it is transacted at an annual general meeting, with the exception of the election of Directors which shall be deemed ordinary business.

 

No business other than the appointment of a chairman of a meeting shall be transacted at any general meeting unless a quorum is present when the meeting proceeds to business and continues to be present until the conclusion of the meeting.

 

The quorum for a general meeting shall be two members entitled to vote and present in person (or in the case of a member being a corporation, by our duly authorized representative) or by proxy representing not less than one-third (1/3) in nominal value of the total issued voting shares in our Company throughout the meeting.

 

Inspection of Books and Records

 

Our shareholders have no general right to inspect or obtain copies of the register of members or corporate records of our company. They will, however, have such rights as may be set out in our Articles of Association.

 

Changes in Capital

 

Subject to the Companies Act, our shareholders may, by ordinary resolution:

 

(a) increase our share capital by new shares of the amount fixed by that ordinary resolution and with the attached rights, priorities and privileges set out in that ordinary resolution;

 

(b) consolidate and divide all or any of our share capital into shares of larger amount than our existing shares;

 

(c) sub-divide our shares or any of them into our shares of smaller amount than is fixed by our Company’s Memorandum of Association, so, however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced our shares shall be the same as it was in case of the share from which the reduced our shares is derived;

 

(d) cancel any shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so cancelled; and

 

(e) convert all or any of our paid-up shares into stock and reconvert that stock into paid up shares of any denomination.

 

Subject to the Companies Act and to any rights for the time being conferred on the shareholders holding a particular class of shares, our shareholders may, by special resolution, reduce our share capital or any capital redemption reserve in any way.

 

5

Exhibit 12.1

 

CERTIFICATION

 

I, Eva Yuk Yin Siu, Chief Executive Officer, certify that:

 

1.	I have reviewed this Annual Report on Form 20-F of Neo-Concept International Group Holdings Limited.;
2.	Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading regarding the period covered by this Annual Report;
3.	Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this Annual Report;
4.	The Company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Annual Report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this Annual Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Annual Report based on such evaluation; and
	(d)	Disclosed in this Annual Report any change in the Company’s internal control over financial reporting that occurred during the period covered by the Annual Report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and
5.	The Company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

 

Dated: May 14, 2024	By:	/s/ Eva Yuk Yin Siu
	Name:	Eva Yuk Yin Siu
	Title:	Chief Executive Officer

 

Signature Page to Form 20-F

 

Exhibit 12.2

 

CERTIFICATION

 

I, Patrick Kwok Fai Lau, Chief Financial Officer, certify that:

 

1.	I have reviewed this Annual Report on Form 20-F of Neo-Concept International Group Holdings Limited;
2.	Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading regarding the period covered by this Annual Report;
3.	Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this Annual Report;
4.	The Company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:
	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Annual Report is being prepared;
	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	(c)	Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this Annual Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Annual Report based on such evaluation; and
	(d)	Disclosed in this Annual Report any change in the Company’s internal control over financial reporting that occurred during the period covered by the Annual Report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and
5.	The Company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s Board of Directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

 

Dated: May 14, 2024	By:	/s/ Patrick Kwok Fai Lau
	Name:	Patrick Kwok Fai Lau
	Title:	Chief Financial Officer

 

Signature Page to Form 20-F

 

Exhibit 13.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Annual Report of Neo-Concept International Group Holdings Limited (the “Company”) on Form 20-F for the year ended December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), I, Eva Yuk Yin Siu, Johnson Chen, Chief Executive Officer, and I, Patrick Kwok Fai Lau, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)

The Annual Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)

The information contained in the Annual Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

 

Dated: May 14, 2024	By:	/s/ Eva Yuk Yin Siu
	Name:	Eva Yuk Yin Siu
	Title:	Chief Executive Officer

 

Dated: May 14, 2024	By:	/s/ Patrick Kwok Fai Lau
	Name:	Patrick Kwok Fai Lau
	Title:	Chief Financial Officer

 

Signature Page to Form 20-F

 

 

Document And Entity Information	12 Months Ended
	Dec. 31, 2023 shares
Document Information Line Items
Entity Registrant Name	Neo-Concept International Group Holdings Limited
Trading Symbol	NCI
Document Type	20-F
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding	18,000,000
Amendment Flag	false
Entity Central Index Key	0001916331
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Non-accelerated Filer
Entity Well-known Seasoned Issuer	No
Document Period End Date	Dec. 31, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	FY
Entity Emerging Growth Company	true
Entity Shell Company	false
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Document Registration Statement	false
Document Annual Report	true
Document Transition Report	false
Document Shell Company Report	false
Entity File Number	001-42016
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	10/F, Seaview Centre
Entity Address, Address Line Two	No.139-141 Hoi Bun Road
Entity Address, City or Town	Kwun Tong Kowloon
Entity Address, Country	HK
Title of 12(b) Security	Ordinary shares, par value $0.0000625 per share
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes
Document Financial Statement Error Correction [Flag]	false
Document Accounting Standard	U.S. GAAP
Auditor Name	WWC, P.C.
Auditor Firm ID	1171
Auditor Location	San Mateo, California
Entity Address, Postal Zip Code	00000
Business Contact
Document Information Line Items
Entity Address, Address Line One	10/F, Seaview Centre
Entity Address, Address Line Two	No.139-141 Hoi Bun Road
Entity Address, City or Town	Kwun Tong Kowloon
Entity Address, Country	HK
Contact Personnel Name	Patrick Kwok Fai Lau
City Area Code	(852)
Local Phone Number	2798-8639
Contact Personnel Email Address	Email: [e-mail]
Entity Address, Postal Zip Code	00000

Consolidated Balance Sheets		Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
CURRENT ASSETS
Cash and cash equivalents		$ 5,849,306	$ 748,865	$ 8,593,063
Accounts receivable, net		32,343,592	4,140,828	10,339,186
Other current assets, net		20,225,722	2,589,425	4,380,864
Inventories, net		5,320,199	681,125	1,299,895
Total current assets		63,738,819	8,160,243	40,885,741
NON-CURRENT ASSETS
Property and equipment, net		1,297,682	166,137	54,926
Right-of-use assets, net		23,884,854	3,057,888	653,344
Intangible assets, net				112,049
Other non-current assets, net		1,695,474	217,065	159,401
Deferred tax assets				7,876
Total non-current assets		26,878,010	3,441,090	987,596
Total assets		90,616,829	11,601,333	41,873,337
CURRENT LIABILITIES
Bank borrowings		30,753,400	3,937,242	83,962,426
Accounts payable				10,429,941
Accruals and other payables		3,205,705	410,413	2,242,615
Operating lease liabilities		708,829	90,750	653,344
Tax payable		916,436	117,329	4,885,548
Total current liabilities		69,827,614	8,939,767	102,173,874
NON-CURRENT LIABILITIES
Bank borrowings				375,059
Operating lease liabilities		23,176,025	2,967,138
Total non-current liabilities		23,176,025	2,967,138	375,059
Total liabilities		93,003,639	11,906,905	102,548,933
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ DEFICIT
Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023, 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023*	[1]	8,775	1,125	8,775
Additional paid-in capital		55,091,225	7,053,121	91,225
Accumulated other comprehensive income		844,791	108,156	1,970,738
Accumulated losses		(58,331,601)	(7,467,974)	(62,746,334)
Total shareholders’ deficit		(2,386,810)	(305,572)	(60,675,596)
Total liabilities and shareholders’ deficit		90,616,829	11,601,333	41,873,337
Related Party
CURRENT ASSETS
Due from related parties				16,272,733
CURRENT LIABILITIES
Due to related parties		$ 34,243,244	$ 4,384,033
[1] Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

Consolidated Balance Sheets (Parentheticals)		Dec. 31, 2023 $ / shares shares	Dec. 31, 2022 $ / shares shares
Statement of Financial Position [Abstract]
Ordinary shares: par value (in Dollars per share and Dollars per share) | (per share)	[1]	$ 0.0000625
Ordinary shares: shares authorized	[1]	800,000,000	800,000,000
Ordinary shares: shares issued	[1]	18,000,000	18,000,000
Ordinary shares: shares outstanding	[1]	18,000,000	18,000,000
[1] Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

Consolidated Statements of Income and Comprehensive Income	12 Months Ended
	Dec. 31, 2023 HKD ($) $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares	Dec. 31, 2022 HKD ($) $ / shares shares	Dec. 31, 2021 HKD ($) $ / shares shares
REVENUES, NET	$ 174,202,627	$ 22,302,504	$ 347,451,568	$ 240,536,527
COST OF REVENUES
COST OF REVENUES	(139,154,316)	(17,815,401)	(305,616,607)	(217,943,422)
Gross profit	35,048,311	4,487,103	41,834,961	22,593,105
EXPENSES
Selling and marketing	(3,132,277)	(401,014)	(2,631,231)	(3,133,094)
Depreciation – related party	(720,000)	(92,179)	(720,000)
Depreciation	(2,540,273)	(325,222)	(2,485,017)	(2,486,443)
Management fee – related party				(4,223,236)
Staff cost	(13,260,898)	(1,697,743)	(12,436,317)	(6,324,017)
Professional fee	(2,204,622)	(282,249)	(3,654,819)	(623,530)
Allowance for expected credit losses	(1,383,316)	(177,101)
Others	(2,760,400)	(353,403)	(972,264)	(1,329,634)
Total expenses	(26,001,786)	(3,328,911)	(22,899,648)	(18,119,954)
INCOME FROM OPERATION	9,046,525	1,158,192	18,935,313	4,473,151
OTHER INCOME (EXPENSES)
Interest income	92,951	11,900	1	1
Interest expense	(5,759,182)	(737,326)	(6,133,455)	(2,492,179)
Agency income – related party	2,662,034	340,810	2,586,019	2,904,339
Other income	326	42		2,313,438
Other expense	(302,784)	(38,764)	(7,444)	(5,953)
Total other income (expenses), net	(3,306,655)	(423,338)	(3,554,879)	2,719,646
INCOME BEFORE TAX EXPENSES	5,739,870	734,854	15,380,434	7,192,797
INCOME TAX EXPENSES	(1,325,137)	(169,652)	(2,979,918)	(1,742,282)
NET INCOME	4,414,733	565,202	12,400,516	5,450,515
FOREIGN CURRENCY TRANSLATION ADJUSTMENT	(1,125,947)	(143,118)	2,514,162	138,058
TOTAL COMPREHENSIVE INCOME	$ 3,288,786	$ 422,084	$ 14,914,678	$ 5,588,573
Basic and diluted (in Shares)	18,000,000	18,000,000	18,000,000	18,000,000
EARNINGS PER SHARE – BASIC AND DILUTED (in Dollars per share and Dollars per share) | (per share)	$ 0.25	$ 0.03	$ 0.69	$ 0.3
Related parties
COST OF REVENUES
COST OF REVENUES	$ (34,213,521)	$ (4,380,228)	$ (103,159,420)	$ (29,522,341)
External
COST OF REVENUES
COST OF REVENUES	$ (104,940,795)	$ (13,435,173)	$ (202,457,187)	$ (188,421,081)

Consolidated Statements of Income and Comprehensive Income (Parentheticals)	12 Months Ended
	Dec. 31, 2023 $ / shares shares	Dec. 31, 2023 $ / shares shares	Dec. 31, 2022 $ / shares shares	Dec. 31, 2021 $ / shares shares
Income Statement [Abstract]
Weighted average number of ordinary shares, Diluted	18,000,000	18,000,000	18,000,000	18,000,000
EARNINGS PER SHARE -DILUTED (in Dollars per share and Dollars per share) | (per share)	$ 0.25	$ 0.03	$ 0.69	$ 0.30

Consolidated Statements of Changes of Shareholders’ Deficit	Ordinary shares HKD ($) shares	Ordinary shares USD ($) shares	Addition paid-in capital HKD ($)	Addition paid-in capital USD ($)	Accumulated other comprehensive (losses) income HKD ($)	Accumulated other comprehensive (losses) income USD ($)	Accumulated losses HKD ($)	Accumulated losses USD ($)	HKD ($) shares		USD ($) shares
Balance (in Dollars)	$ 8,775		$ 91,225		$ (681,482)		$ (78,082,256)		$ (78,663,738)
Balance at Dec. 31, 2020	$ 8,775		91,225		(681,482)		(78,082,256)		(78,663,738)
Balance (in Shares) at Dec. 31, 2020 | shares	18,000,000	18,000,000
Net income							5,450,515		5,450,515
Distribution in specie and cash							(2,515,109)		(2,515,109)
Foreign currency translation					138,058				138,058
Balance at Dec. 31, 2021	$ 8,775		91,225		(543,424)		(75,146,850)		(75,590,274)
Balance (in Shares) at Dec. 31, 2021 | shares	18,000,000	18,000,000
Balance (in Dollars)	$ 8,775		91,225		(543,424)		(75,146,850)		(75,590,274)
Net income							12,400,516		12,400,516
Foreign currency translation					2,514,162				2,514,162
Balance at Dec. 31, 2022	$ 8,775		91,225		1,970,738		(62,746,334)		$ (60,675,596)
Balance (in Shares) at Dec. 31, 2022 | shares	18,000,000	18,000,000							18,000,000	[1]	18,000,000	[1]
Balance (in Dollars)	$ 8,775		91,225		1,970,738		(62,746,334)		$ (60,675,596)
Net income							4,414,733		4,414,733		$ 565,202
Forgiveness of related party balance			55,000,000						55,000,000
Foreign currency translation					(1,125,947)				(1,125,947)		(143,118)
Balance at Dec. 31, 2023	$ 8,775	$ 1,125	55,091,225	$ 7,053,121	844,791	$ 108,156	(58,331,601)	$ (7,467,974)	$ (2,386,810)		$ (305,572)
Balance (in Shares) at Dec. 31, 2023 | shares	18,000,000	18,000,000							18,000,000	[1]	18,000,000	[1]
Balance (in Dollars)	$ 8,775	$ 1,125	$ 55,091,225	$ 7,053,121	$ 844,791	$ 108,156	$ (58,331,601)	$ (7,467,974)	$ (2,386,810)		$ (305,572)
[1] Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

Consolidated Statements of Cash Flows	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Cash flows from operating activities
Net income	$ 4,414,733	$ 565,202	$ 12,400,516	$ 5,450,515
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation of property and equipment	33,091	4,237	11,114	136,236
Depreciation of right-of-use assets	3,260,273	417,400
Amortization of intangible assets	112,049	14,345	137,358	151,634
Inventory provision	68,536	8,774
Allowance for expected credit loss	1,383,316	177,101
Changes in operating assets and liabilities
Accounts receivable	(23,387,722)	(2,994,242)	19,369,617	(29,744,236)
Other current assets	(14,332,426)	(1,834,926)	(3,796,835)	(589,596)
Deferred tax assets	7,876	1,008
Inventories	(4,088,840)	(523,479)	(619,878)	646,291
Accounts payable	(10,429,941)	(1,335,306)	(74,184,359)	32,554,096
Accruals and other payables	963,089	123,301	921,015	(76,800)
Lease liabilities	(3,260,273)	(417,400)
Tax payable	(3,969,112)	(508,150)	3,001,914	1,742,282
Net cash from (used in) operating activities	(49,225,351)	(6,302,136)	(42,759,538)	10,270,422
Cash flows from investing activities
Purchase of property and equipment	(1,275,847)	(163,342)	(73,526)	(78,190)
Cash used in investing activities	(1,275,847)	(163,342)	(73,526)	(78,190)
Cash flows from financing activities
Proceeds from bank borrowings	115,018,274	14,725,356	508,716,999	243,090,875
Repayment for bank borrowings	(168,602,359)	(21,585,523)	(452,377,168)	(220,367,256)
Distribution in cash				(266,559)
Advance to related parties			(6,341,947)	(31,642,544)
Repayment from related parties	16,272,733	2,083,336
Advance from related parties	84,857,958	10,864,044
Net cash (used in) from financing activities	47,546,606	6,087,213	49,997,884	(9,185,484)
Net increase (decrease) in cash and cash equivalents	(2,954,592)	(378,265)	7,164,820	1,006,748
Cash and cash equivalents at the beginning of the year	8,593,063	1,100,137	1,428,243	421,495
Cash and cash equivalents at the end of the year	5,638,471	721,872	8,593,063	1,428,243
Supplementary cash flow information
Interest received	92,951	11,900	1	1
Interest paid	(6,134,748)	(785,409)	(6,102,137)	(2,889,864)
Tax paid	(3,314,625)	(424,359)	(21,996)
Non-cash investing and financing activities: Supplemental schedule of non-cash investing and financing activities:
Operating lease right-of-use assets obtained in exchange for operating lease liabilities	23,153,141	2,964,209	1,406,891
Distribution in specie				$ (2,248,550)

Organization and Principal Activities	12 Months Ended
	Dec. 31, 2023
Organization and Principal Activities [Abstract]
ORGANIZATION AND PRINCIPAL ACTIVITIES	1. organization and principal activities   Business   Neo-Concept International Group Holdings Limited (“We”, “us”, “Our”, “our Company”, the “Company” or “NCI”), through its wholly-owned subsidiaries is engaged in one-stop apparel solution services, offering a full suite of services in the apparel supply chain, including market trend analysis, product design and development, raw material sourcing, production and quality control, and logistics management serving the European, and North American markets. In addition, we sell apparel products in the United Kingdom (“UK”) under the licensed brand “les 100 ciels” through our retail stores since 2000. NCI and its subsidiaries are thereafter referred as the “Group” hereafter.   Organization and reorganization   NCI, incorporated in July 2021 under the laws of the Cayman Islands, is the holding company of our Group.   Neo-Concept Apparel Group Limited (“NCA”), a British Virgin Islands (“BVI”) business company limited by shares incorporated in August 2008, is the immediate holding company of Neo-Concept International Company Limited (“Neo-Concept HK”). The equity interest of NCA was ultimately held as to 94% by Ms. Eva Yuk Yin Siu (our “Controlling Shareholder”, or “Ms. Siu”) and 6% by Ms. Man Chi Wai (“Ms. Wai”) through certain intermediate holding companies prior to the Group Reorganization (see below).   Neo-Concept HK, a company incorporated in Hong Kong with limited liability in October 1992, is the immediate holding company of Neo-Concept (UK) Limited, and is our operating subsidiary in Hong Kong.   Neo-Concept (UK) Limited (“Neo-Concept UK”), a company incorporated in the UK with limited liability in August 2000, is a direct wholly owned subsidiary of Neo-Concept HK, and is our operating subsidiary in the UK.   Neo-Concept (NY) Corporation (“Neo-Concept NY”), a company incorporated in the United States of America (“USA”) with limited liability in June 2, 1999, was a direct wholly owned subsidiary of Neo-Concept HK, and was disposed of via distribution in December 2021.   Pursuant to a group reorganization (the “Group Reorganization”) to rationalize the structure of the Company and its subsidiary companies in preparation for the listing of our shares, the Company became the holding company of the Group on October 29, 2021, which involved the transfer of 100 shares of NCA (representing 100% of the issued shares of NCA) by Ms. Siu and Ms. Wai to the Company in exchange for 100 shares of Neo-Concept (BVI) Limited (“NC (BVI)”) (representing 100% of the issued shares of NC (BVI)), a then 100% held subsidiary of the Company, to be transferred to Splendid Vibe Limited, a company incorporated in BVI and was held as to 94% by Ms. Siu and 6% by Ms. Wai ultimately. The Company, together with its wholly owned subsidiaries, are effectively controlled by the same shareholders, i.e., ultimately held as to 94% by Ms. Siu and 6% by Ms. Wai, before and after the Group Reorganization and therefore the Group Reorganization is considered as a recapitalization of entities under common control. The consolidation of the Company and its subsidiaries has been accounted for at historical cost. No amount is recognized in respect of goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination. The consolidated statements of income and comprehensive income, consolidated statements of changes of shareholders’ deficit and consolidated statements of cash flows are prepared as if the current Group structure had been in existence throughout the year ended December 31, 2020 and the period before the Group Reorganization had taken place, or since the respective dates of incorporation/establishment of the relevant entity, where this is a shorter period.   Upon the Group Reorganization and as at the date of this report, details of the subsidiary companies are as follows:   Name   Background   Ownership Neo-Concept Apparel Group Limited   ●   A BVI company   ●   Incorporated in August 2008   ●   Issued Share Capital of US$100   ●   Intermediate holding company   100% owned by NCI   Name   Background   Ownership Neo-Concept International Company Limited   ●   A Hong Kong company   ●   Incorporated in October 1992   ●   Issued Share Capital of HKD 100,000   ●   Provision of one-stop apparel solution services   100% owned by NCA           Neo-Concept (UK) Limited   ●   A UK company   ●   Incorporated in August 2000   ●   Issued Share Capital of GBP100   ●   Provision of online and offline retail sales of apparel products   100% owned by Neo-Concept HK

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2023
Summary of Significant Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2. Summary of Significant Accounting Policies   Basis of presentation   The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for information pursuant to the rules and regulations of the Securities and Exchange Commission.   Principles of consolidation   The consolidated financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.   Merger accounting for business combinations involving entities under common control   The consolidated financial statements incorporate the financial statements items of the combining entities or businesses in which the common control combination occurs as if they had been combined from the date when the combining entities or businesses first came under the control of the controlling parties.   The net assets of the combining entities or businesses are combined using the existing book values from the controlling parties’ perspective. No amount is recognized in respect of goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination, to the extent of the continuation of the controlling parties’ interest.   The combined statement of comprehensive income includes the results of each of the combining entities or businesses from the earliest date of presented or since the date when the combining entities or businesses first came under the common control, where this is a shorter period, regardless of the date of the common control combination.   Use of estimates and assumptions   The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property and equipment, valuation allowance for deferred tax assets, fair value of financial instruments and contingencies. Actual results could vary from the estimates and assumptions that were used.   Functional currency and foreign currency translation   We use Hong Kong dollars (“HKD”) as our reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands and BVI is the United States dollar (“US$”) and the functional currency of the functional currency of its Hong Kong subsidiary is the Hong Kong dollar (“HKD”), and its UK subsidiary is the Pound Sterling (“GBP”). The determination of the respective functional currency is based on the criteria of Accounting Standards Codification (“ASC”) 830, Foreign Currency Matters.   Transactions denominated in currencies other than functional currency are translated into functional currency at the exchange rates quoted by authoritative banks prevailing at the dates of the transactions. Exchange gains and losses resulting from those foreign currency transactions denominated in a currency other than the functional currency are recorded as other income (expense), net in the consolidated statements of comprehensive income.   The financial statements of the Group are translated from the functional currency into HKD. Assets and liabilities are translated at the exchange rates at the balance sheet date. Equity accounts other than earnings generated in the current period are translated into HKD using the appropriate historical rates. Revenues and expenses, gains and losses are translated into HKD using the periodic average exchange rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income (expense) in the consolidated statements of comprehensive income.   Convenience translation   Translations of amounts in the consolidated balance sheet, consolidated statements of income and consolidated statements of cash flows from HKD into US$ as of and for the year ended December 31, 2023, are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.8109, as published in H.10 statistical release of the United States Federal Reserve Board. No representation is made that the HKD amounts could have been, or could be, converted, realized, or settled into US$ at such rate or at any other rate.   Cash and cash equivalents   We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.   Accounts receivable and allowance for expected credit losses   Accounts receivable, net are stated at the original amount less an allowance for expected credit loss on such receivables. The allowance for expected credit losses is estimated based upon our assessment of various factors including historical experience, the age of the accounts receivable balances, current general economic conditions, future expectations and customer specific quantitative and qualitative factors that may affect our customers’ ability to pay. An allowance is also made when there is objective evidence for us to reasonably estimate the amount of probable loss. The Company regularly reviews the adequacy and appropriateness of the allowance for doubtful accounts. The receivables are written off after all collection efforts have ceased.   Other non-current assets, net   Other current assets are rental deposits.   Other current assets, net   Other current assets, net primarily include deferred IPO costs, prepayments and others.   Inventories, net   Inventories, representing finished goods for sale, are stated at the lower of cost or net realizable value, using the weighted average method. We evaluate the need for impairment associated with obsolete, slow-moving, and non-saleable inventory by reviewing net realizable value on a periodic basis but at least annually. Only defective products are eligible for returning to our materials suppliers.   Property and equipment, net   Property and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation are relieved of the applicable amounts. Gains or losses from retirements or sale are credited or charged to operations.   We depreciate property and equipment using the straight-line method as follows:   Leasehold improvement   Over the shorter of the terms of leases or 5 years when the renewal of leases is unconditional       Furniture, fixtures, and office equipment   6 years to 7 years   Intangible assets, net   Intangible assets are primarily purchased from third parties. Purchased intangible assets are initially recognized and measured at cost upon acquisition. Intangible assets that have determinable lives are amortized over their estimated useful lives based upon the usage of the asset, which is approximated using a straight-line method as follows:   Computer software – Point-of-sale system   10 years   Impairment for long-lived assets   Long-lived assets, representing property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assess the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2022 and 2023, no impairment of long-lived assets was recognized.   Fair value measurement   The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by us.   The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow:   Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.   Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.   Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.   Accounts payable   Accounts payable represents trade payables to vendors.   Accruals and other payables   Accruals and other payables primarily include payroll payable, interest payable, VAT and other accrual and payables.   Leases   Before January 1, 2020, we applied ASC Topic 840 (“ASC 840”), “Leases”, and each lease is classified at the inception date as either a capital lease or an operating lease.   We adopted ASC 842, “Leases” (“ASC 842”) on January 1, 2020, using the modified retrospective transition method through a cumulative-effect adjustment in the period of adoption rather than retrospectively adjusting prior periods and the package of practical expedient. We categorized leases with contractual terms longer than twelve months as either operating or finance lease. The adoption of ASC 842 resulted in recognition of Operating Right-of-use (“ROU”) assets of HKD 541,625 and operating lease liabilities of and HKD 541,625 as of January 1, 2020. There is no impact to accumulated deficit at adoption.   ROU assets represent our rights to use underlying assets for the lease terms and lease liabilities represent our obligation to make lease payments arising from the leases. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term, reduced by lease incentives received, plus any initial direct costs, using the discount rate for the lease at the commencement date. If the implicit rate in lease is not readily determinable for our operating leases, we generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We elected not to separate non-lease components from lease components; therefore, it will account for lease component and the non-lease components as a single lease component when there is only one vendor in the lease contract for the office leases. Lease payments are fixed.   For operating leases, lease expense is recognized on a straight-line basis in operations over the lease term.   Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities on the consolidated balance sheets.   Lease payments that depend on the future use of the leased property, such as sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety in accordance with ASC 840-10-25-5. Accordingly, these contingent rentals are excluded from the ROU assets and lease liabilities on the consolidated balance sheets. Lease payments of the Group’s retail stores located in the UK are charged based on the sales volume during the lease terms and therefore they are excluded from the recognition of ROU assets and lease liabilities on the consolidated balance sheets.   Bank borrowings   Borrowings are initially recognized at fair value, net of upfront fees incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method.   Employee benefit plan   Payments to the Mandatory Provident Fund Scheme under the Hong Kong Mandatory Provident Fund Schemes Ordinance and state-managed retirement benefit schemes in other jurisdictions are recognized as an expense when employees have rendered service entitling them to the contributions.   Related parties   We adopted ASC 850, “Related Party Disclosures”, for the identification of related parties and disclosure of related party transactions.   The details of related party transaction during the year ended December 31, 2021, 2022 and 2023, and balances as at December 31, 2022 and 2023 are set out in note 12.   Revenue recognition   We adopted ASC Topic 606, “Revenue from Contracts with Customers”, and all subsequent ASUs that modified ASC 606 on April 1, 2017, using the full retrospective method which requires us to present the financial statements for all periods as if Topic 606 had been applied to all prior periods. We derive revenue principally from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores. Revenue from contracts with customers is recognized using the following five steps:   1. Identify the contract(s) with a customer;   2. Identify the performance obligations in the contract;   3. Determine the transaction price;   4. Allocate the transaction price to the performance obligations in the contract; and   5. Recognize revenue when (or as) the entity satisfies a performance obligation.   A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services.   The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until we identify a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. We have addressed whether various goods and services promised to the customer represent distinct performance obligations. We applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations.   Our revenues from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores and digital channels are recognized at a point in time.   The transaction price is allocated to each performance obligation in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual standalone selling price of a good or service that has not previously been sold on a stand-alone basis, is determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with observable stand-alone selling price.   Transaction price is the amount of consideration in the contract to which we expect to be entitled in exchange for transferring the promised goods or services. The transaction price is fixed and is adjusted for time value of money if the contract includes a significant financing component. Consideration payable to a customer is deducted from the transaction price if we do not receive a separate identifiable benefit from the customer. Revenue is recognized at a point in time. Typically, performance obligation for products where the process is described as below, the performance obligation is satisfied at point in time.   The Company currently generates its revenue from the following main sources:   Sale of private-labelled apparel products-customized original design manufacturer   We currently generate our revenue from the sale of private-labelled apparel products. We are an original design manufacturer. We offer customized design and manufacturing services to customers. We typically receive purchase orders from our customers who operate retail stores, which will set forth the terms and conditions including the transaction price, products to be delivered, terms of delivery, and terms of payment. The terms serve as the basis of the performance obligations that we must fulfil in order to recognize revenue. There is only one performance obligation as a series of services of this revenue stream are interrelated and are not separable or distinct as our customers cannot benefit from the standalone task (i.e. customers do not obtain any benefits other than the finished products). The key performance obligation is the delivery of the finished product to the customer at their specified location at which point title to that asset passes to the customer. The completion of this earning process is evidenced by a written customer acceptance indicating receipt of the product. Typical payment terms set forth in the purchase order ranges from 30 to 90 days from invoice date.   The transaction price does not include variable consideration provision for right of return as we do not have sales return policy and no sales return is offered. No right of return is included in the revenue of the Company.   Retail sale of own-branded apparel products - “les 100 ciels”   We currently generate our revenue from the sale of own-branded apparel products through our physical and digital channels. Retail revenue at a point of sale is measured at the fair value of the consideration received at the time the sale is made to the customer, net of discounts. Customers settle the consideration by cash or credit cards. For online sales, we have elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. Accordingly, we recognize revenue for our single performance obligation related to online sales at the time control of the merchandise passes to the customer, which is generally at the time of shipment.   The transaction price includes variable consideration provision for right of return as we have sales return policy. We record an allowance for estimated merchandise returns based on our historical return patterns and various other assumptions that management believes to be reasonable. For the years ended December 31, 2021, 2022 and 2023, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers.   Following the adoption of ASC 606, we considered the guidance set forth in ASC 340-40, and determined that an asset would be recognized from costs incurred to fulfill a contract under ASC 340-40-25-5 only if those costs meet all of the following criteria:   ● The costs relate directly to a contract or an anticipated contract that the entity can specifically identify (for example, costs relating to services to be provided under the renewal of an existing contract or costs of designing an asset to be transferred under a specific contract that has not yet been approved).   ● The costs generate or enhance resources of the entity that will be used in satisfying (or continuing to satisfy) performance obligations in the future.   ● The costs are expected to be recovered.   The Company elected to apply the practical expedient to recognize the incremental costs of obtaining a contract as an expense if the amortization period of the asset would have been one year or less.   Costs that relate directly to a contract include cost of purchasing of private-labelled and own-branded apparel products from suppliers.   We elected to treat shipping and handling costs undertaken by the Company after the customer has obtained control of the related goods as a fulfillment activity and present as transportation costs in selling and marketing expenses.   Costs associated with the production of advertising, such as writing, printing, and other costs, are expensed as incurred. Costs associated with communicating advertising that has been produced, such as magazine costs, are expensed when the advertising event takes place.   Cost of revenues   Cost of revenues of private-labelled apparel products and cost of revenues of own-branded apparel products in our retail stores, which are directly related to revenue-generating transactions, primarily consist of cost of purchasing of private-labelled and own-branded apparel products from suppliers, and inbound shipping and handling cost.   Selling and marketing expenses   Selling and marketing expenses consist primarily of transportation and distribution expenses and marketing and displaying expenses.   General and administrative expenses   General and administrative expenses primarily consist of personnel-related compensation expenses, including salaries and related social insurance costs for our operations and supporting personnel, office rental and office expenses, insurance, amortization of intangible assets, write-down of inventories, allowance for doubtful debts, depreciation, professional services fees, and other expenses related to general operations.   Shipping and handling costs   Shipping and handling costs are expensed as incurred. Inbound shipping and handling costs associated with bringing the products from suppliers to the Company’s retail stores are included in cost of revenues. Outbound shipping and handling costs associated with shipping and delivery the products to customers are included in selling and marketing expenses.   Government grants   Government grants are recognized as income in other income or as a reduction of specific costs and expenses for which the grants are intended to compensate. Such amounts are recognized in the consolidated statements of comprehensive income upon receipt and when all conditions attached to the grants, such as companies are required to stay in the same level of employment, are fulfilled.   Income taxes   We account for income taxes pursuant to ASC Topic 740, “Income Taxes”. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain.   We adopted ASC Topic 740-10-05, “Income Tax”, which provides guidance for recognizing and measuring uncertain tax positions, it prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the consolidated financial statements. It also provides accounting guidance on derecognizing, classification, and disclosure of these uncertain tax positions.   Our policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expenses.   Value added tax (“VAT”)   Our subsidiary in UK is subject to VAT and related surcharges on revenue generated from sale of products. The Group records revenue net of VAT. Entities that are VAT general taxpayers are allowed to offset qualified input VAT, paid to suppliers against their output VAT liabilities. The primary applicable rate of the United Kingdom VAT is 20% for the years ended December 31, 2021, 2022 and 2023.   Comprehensive income    We present comprehensive income in accordance with ASC Topic 220, “Comprehensive Income”. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments.   Commitments and contingencies   In the normal course of business, we are subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. We recognize a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. We may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.   Earnings per share   We compute earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options, and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. For the years ended December 31, 2021, 2022 and 2023, there were no dilutive shares.   Recently issued accounting pronouncements   In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures. The purpose of the update was to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all periods presented in the consolidated financial statements. Management is evaluating the impact on the Company’s consolidated financial statements.   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its consolidated financial statements and disclosures.   Except as mentioned above, we do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

Segment information	12 Months Ended
	Dec. 31, 2023
Segment Information [Abstract]
SEGMENT INFORMATION	3. Segment information   ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in consolidated financial statements for details on the Company’s business segments. The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. Management, including the chief operating decision maker, reviews operation results by the revenue of different products or services. Based on management’s assessment, the Company has determined that it has only one operating segment.

Inventories, Net	12 Months Ended
	Dec. 31, 2023
Inventory Disclosure [Abstract]
INVENTORIES, NET	4. INVENTORIES, NET   Inventories, net are comprised of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Own-branded apparel products     1,299,895       5,388,735       689,899   Less: inventory provision     —       (68,536 )     (8,774 ) Total     1,299,895       5,320,199       681,125     Inventory write-down expense was nil, nil and HKD 68,536 (US$8,774) for the years ended December 31, 2021, 2022, and 2023, respectively.

Accounts Receivable, Net	12 Months Ended
	Dec. 31, 2023
Accounts Receivable, Net [Abstract]
ACCOUNTS RECEIVABLE, NET	5. ACCOUNTS RECEIVABLE, NET   Accounts receivable, net is comprised of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Accounts receivable – excluding due from factor     6,114,794       33,758,410       4,321,962   Accounts receivable – due from factor     4,255,894       —       —   Allowance for expected credit losses     (31,502 )     (1,414,818 )     (181,134 ) Total     10,339,186       32,343,592       4,140,828     Allowance for expected credit losses, net consists of the following:       2022     2023     2023       HKD     HKD     US$   Beginning balance, January 1     31,502       31,502       4,033   Addition     —       1,383,316       177,101   Ending balance, December 31     31,502       1,414,818       181,134

Other Current Assets, Net	12 Months Ended
	Dec. 31, 2023
Other Current Assets, Net [Abstract]
OTHER CURRENT ASSETS, NET	6. OTHER CURRENT ASSETS, NET   Other current assets, net consist of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Deferred IPO costs     4,229,639       8,148,021       1,043,160   Prepayments     129,229       12,021,838       1,539,110   Others     21,996       55,863       7,155   Total     4,380,864       20,225,722       2,589,425

Property and Equipment, Net	12 Months Ended
	Dec. 31, 2023
Property and Equipment, Net [Abstract]
PROPERTY AND EQUIPMENT, NET	7. PROPERTY AND EQUIPMENT, NET   Property and equipment, net consist of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Furniture, fixtures, and office equipment     556,991       603,082       77,210   Leasehold improvement     —       2,169,258       277,722   Total     556,991       2,772,340       354,932   Less: accumulated depreciation     (502,065 )     (1,474,658 )     (188,795 ) Property and equipment, net     54,926       1,297,682       166,137     Depreciation expenses recognized for the years ended December 31, 2021, 2022 and 2023 were HKD 136,236, HKD 11,114 and HKD 33,091 (approximately US$4,237), respectively.

Intangible Assets, Net	12 Months Ended
	Dec. 31, 2023
Intangible Assets, Net [Abstract]
INTANGIBLE ASSETS, NET	8. INTANGIBLE ASSETS, NET   Intangible assets, net consist of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Software     1,277,753       1,277,753       163,586   Less: accumulated amortization     (1,165,704 )     (1,277,753 )     (163,586 ) Intangible assets, net     112,049       —       —     Amortization recognized for the years ended December 31, 2021, 2022, and 2023 were HKD 151,634, HKD 137,358 and HKD 112,049 (approximately US$14,345), respectively.

Accruals and Other Payables	12 Months Ended
	Dec. 31, 2023
Accruals and Other Payables [Abstract]
ACCRUALS AND OTHER PAYABLES	9. ACCRUALS AND OTHER PAYABLES   Accruals and other payables consist of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Payroll payable     734,454       2,185,617       279,816   Interest payable     412,442       46,397       5,940   VAT     905,214       834,902       106,889   Others     190,505       138,789       17,768   Total     2,242,615       3,205,705       410,413

Bank Borrowings	12 Months Ended
	Dec. 31, 2023
Bank Borrowings [Abstract]
BANK BORROWINGS	10. BANK BORROWINGS   Outstanding balances of bank borrowings as of December 31, 2022, and 2023 consisted of the following:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Bank borrowings:                   Guaranteed     375,059       —       —   Collateralized and guaranteed     83,962,426       30,753,400       3,937,242         84,337,485       30,753,400       3,937,242   Less: current maturities     (83,962,426 )     (30,753,400 )     (3,937,242 ) Non-current maturities     375,059       —       —     Bank borrowings as of December 31, 2022 and 2023 are as follows:           Maturity       Interest   Interest   As of December 31,   Lender   Type   date   Currency   rate as of December 31, 2022   rate as December 31, 2023   2022     2023     2023                           HKD     HKD     US$   DBS Bank (Hong Kong) Limited (i)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     17,232,296       5,884,863       753,417   The Hongkong and Shanghai Banking Corporation Limited (i)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     44,500,679       21,568,885       2,761,383   Dah Sing Bank, Limited (i)   Overdraft   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     22,229,451       —       —   Citibank, N.A., Hong Kong Branch (ii)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     —       3,299,652       422,442   HSBC UK Bank plc (iii)   Term loan   June 15, 2026   GBP   2.5%   —     375,059       —       —   Total                         84,337,485       30,753,400       3,937,242   Less: current maturities                         (83,962,426 )     (30,753,400 )     (3,937,242 ) Non-current maturities                         375,059       —       —     (i) In connection with our operations in Hong Kong, Neo-Concept HK, together with a related company, Neo-Concept (Holdings) Company Limited (“NCH”), a company incorporated in Hong Kong and controlled by Ms. Siu, entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH combinedly. The banking facilities were secured, details of which are set out as follows:   (a) Unlimited personal guarantee by Ms. Siu;   (b) Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH;   (c) Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces;   (d) Legal charge over certain deposits accounts held by NCH at the relevant banks;   (e) Legal charge over certain investment funds held by NCH at the relevant banks;   (f) Assignment of benefit from life insurances premium assets held by NCH at the relevant banks;   (g) Assignment of benefit from life insurances premium assets held by Pure Diamond Limited, a related company in which Ms. Siu has interests, at a relevant bank;   (h) Indemnity granted by NCH to relevant banks;   (i) Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and   (j) Cross-corporate guaranteed by Neo-Concept HK and NCH;   (ii) The banking facilities were secured, details of which are set out as follows:     (a) Personal guarantee by Ms. Siu and an immediate family member of Ms. Siu;     (b) Cross-corporate guaranteed by Neo-Concept HK, Neo-Concept (BVI) Limited, a company controlled by Ms. Siu, and NCH; and         (c) Legal charge over certain deposits accounts held by NCH at the relevant banks;   (iii) The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.   Loan type in terms of currency   Carrying value     Carrying value     Within 1 year     2024     2025     2026     2027       HKD     US$     HKD     HKD     HKD     HKD     HKD   in HKD     83,962,426       10,749,392       83,962,426       —       —       —       —   in GBP     375,059       48,017       —       —       —       375,059       —   December 31, 2022     84,337,485       10,797,409       83,962,426       —       —       375,059       —     Loan type in terms of currency   Carrying value     Carrying value     Within 1 year     2025     2026     2027     2028       HKD     US$     HKD     HKD     HKD     HKD     HKD   in HKD     30,753,400       3,937,242       30,753,400       —       —       —       —   in GBP     —       —       —       —       —       —       —   December 31, 2023     30,753,400       3,937,242       30,753,400       —       —       —       —

Right-of-use Assets and Lease Liabilities	12 Months Ended
	Dec. 31, 2023
Right-of-use Assets and Lease Liabilities [Abstract]
RIGHT-OF-USE ASSETS AND LEASE LIABILITIES	11. RIGHT-OF-USE ASSETS AND LEASE LIABILITIES   Our operating leases primarily consist of leases of office premises and showrooms. The recognition of whether a contract arrangement contains a lease is made by evaluating whether the arrangement conveys the right to use an identified asset and whether we obtain substantially all the economic benefits from and has the ability to direct the use of the asset.   Operating lease assets and liabilities are included in the items of operating lease right-of-use assets, net, operating lease liabilities, current portion, and operating lease liabilities, non-current portion on the consolidated balance sheets.   We adopted ASU No. 2016-02 and related standards (collectively ASC 842, Leases), which replaced previous lease accounting guidance, on January 1, 2020, using the modified retrospective method of adoption. We elected the transition method expedient which allows entities to initially apply the requirements by recognizing a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. As a result of electing this transition method, prior periods have not been restated. In addition, adoption of the new standard resulted in the recording of right-of-use assets and associated lease liabilities of approximately HKD 541,625 and HKD 541,625, respectively, as of January 1, 2020.   Supplemental balance sheet information related to operating leases was as follows:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Operating lease:                   Operating lease right-of-use assets     653,344       23,884,854       3,057,888   Current operating lease obligation     653,344       708,829       90,750   Non-current operating lease obligation     —       23,176,025       2,967,138   Total operating lease obligation     653,344       23,884,854       3,057,888     Operating lease expense for the year ended December 31, 2021, 2022 and 2023 was HKD 164,482, HKD 2,580,711 and HKD 3,271,053, respectively.   The undiscounted future minimum lease payment schedule as follows:   For the years ending December 31,   HK$     US$   2024     2,014,564       257,917   2025     2,678,490       342,917   2026     2,834,708       362,917   2027     3,023,467       387,083   2028 or after     15,006,137       1,921,179   Total lease payments     25,557,366       3,272,013   Less: imputed interest     (1,672,512 )     (214,125 ) Total operating lease liabilities     23,884,854       3,057,888     Other supplemental information about the Company’s operating lease as of:       December 31, 2023   Weighted average discount rate     7.91 % Weighted average remaining lease term (years)     9.0     Our right-of-use assets and relevant lease liabilities originated from our rented premises for office premises in Hong Kong and retail shops in the UK.

Related Party Balances and Transactions	12 Months Ended
	Dec. 31, 2023
Related Party Balances and Transactions [Abstract]
RELATED PARTY BALANCES AND TRANSACTIONS	12. Related party balances and transactions   Due from related parties consist of the following:           As of December 31,       Relationship   2022     2023     2023           HKD     HKD     US$   Due from Ms. Siu   Controlling Shareholder     70,001       —       —   Due from NCH   Common controlled by Ms. Siu     16,202,732       —       —     Due to related parties consist of the following:           As of December 31,       Relationship   2022     2023     2023           HKD     HKD     US$   Due to Ms. Siu   Controlling Shareholder     —       (59,106 )     (7,567 ) Due to NCH   Common controlled by Ms. Siu     —       (34,184,138 )     (4,376,466 )   The amounts due from (to) the related parties are unsecured, interest free with no specific repayment terms. The amounts due from (to) NCH were non-trade nature, representing fund advances to NCH for its operation.   In addition to the transactions and balances detailed elsewhere in these consolidated financial statements, we also had the following transactions with related parties:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Agency income received by Neo-Concept UK from NCH     2,904,339       2,586,019       2,662,034       340,810   Purchase of apparel products from NCH     29,522,341       103,159,420       34,213,521       4,380,228   Rental expense paid to NCH     —       720,000       720,000       92,179   Management fee paid to NCH     4,223,236       —       —       —

Dissagreggated Revenue	12 Months Ended
	Dec. 31, 2023
Dissagreggated Revenue [Abstract]
DISSAGREGGATED REVENUE	13. DISSAGREGGATED REVENUE   The following table shows disaggregated revenue by major product categories for the years ended December 31, 2021, 2022, and 2023, respectively:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Sale of private-labelled apparel products     237,282,262       336,306,554       156,316,352       20,012,592   Retail sale of own-branded apparel products     3,254,265       11,145,014       17,886,275       2,289,912   Total     240,536,527       347,451,568       174,202,627       22,302,504     The following table shows disaggregated cost of revenues by major product categories for the years ended December 31, 2021, 2022, and 2023, respectively:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Sale of private-labelled apparel products     216,523,165       301,429,220       134,239,759       17,186,208   Retail sale of own-branded apparel products     1,420,257       4,187,387       4,914,557       629,193   Total     217,943,422       305,616,607       139,154,316       17,815,401     The following table sets forth a breakdown of our gross profit and gross profit margin for years ended December 31, 2021, 2022, and 2023:       For the year ended December 31, 2023   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     156,316,352       134,239,759       22,076,593       14.1 % Own-branded apparel products     17,886,275       4,914,557       12,971,718       72.5 % Total     174,202,627       139,154,316       35,048,311       20.1 %       For the year ended December 31, 2022   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     336,306,554       301,429,220       34,877,334       10.4 % Own-branded apparel products     11,145,014       4,187,387       6,957,627       62.4 % Total     347,451,568       305,616,607       41,834,961       12.0 %       For the year ended December 31, 2021   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     237,282,262       216,523,165       20,759,097       8.7 % Own-branded apparel products     3,254,265       1,420,257       1,834,008       56.4 % Total     240,536,527       217,943,422       22,593,105       9.4 %   In the following table, revenue is disaggregated by the geographical locations of customers:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Geographical locations:                         The United States and Canada     235,568,451       328,293,299       132,124,783       16,915,437   The UK     3,080,163       11,145,014       17,898,073       2,291,423   Others     1,887,913       8,013,255       24,179,771       3,095,644   Total     240,536,527       347,451,568       174,202,627       22,302,504

Other Income	12 Months Ended
	Dec. 31, 2023
Other Income [Abstract]
OTHER INCOME	14. OTHER INCOME   Other income consists of the followings:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Government subsidies   2,313,438     —     —     —   Agency income     2,904,339       2,586,019       2,662,034       340,810   Others     —       —       326       42   Total     5,217,777       2,586,019       2,662,360       340,852     Agency income refers to other income from NCH, which was a discretionary payment made to Neo-Concept UK for promoting NCH’s products in UK upon a pre-determined yearly sale target was achieved. There are no enforceable rights and obligations, and the amount is recorded at a point in time.

Taxes	12 Months Ended
	Dec. 31, 2023
Taxes [Abstract]
TAXES	15. TAXES   Income tax   Cayman Islands   The Cayman Islands currently levy no taxes on individuals or corporations based upon profits, income, gains or appreciations and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to our Company levied by the Government of the Cayman Islands save for certain stamp duties which may be applicable, from time to time, on certain instruments.   BVI   NCA is incorporated in the BVI and is not subject to tax on income or capital gains under current BVI law. In addition, upon payments of dividends by these entities to their shareholders, no BVI withholding tax will be imposed.   Hong Kong   Neo-Concept HK is incorporated in Hong Kong and is subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. From year of assessment of 2019/2020 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HKD 2,000,000, and 16.5% on any part of assessable profits over HKD 2,000,000. Under Hong Kong tax law, Neo-Concept HK is exempted from income tax on its foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends.   Other jurisdictions   Taxation arising in other jurisdictions such as the UK and the USA is calculated at the rates prevailing in the relevant jurisdictions.   With effect from 1 April 2023, the current main rate of corporation tax in the UK is 25%.   Significant components of the provision for income taxes are as follows:       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Current:                         Hong Kong     1,742,282       2,979,918       928,973       118,941   The UK     —       —       388,288       49,703   Deferred:                                 Hong Kong     —       —       7,876       1,008   Total provision for income taxes     1,742,282       2,979,918       1,325,137       169,652     The following table reconciles Cayman Islands statutory rates to our effective tax rate:       For the years ended December 31,       2021     2022     2023   Income tax rate in the Cayman Islands, permanent tax holiday     0       0       0   Hong Kong statutory income tax rate     16.5 %     16.5 %     16.5 % Effect of different tax rates     (0.8 )%     (0.6 )%     2.1 % Income not taxable     (5.3 )%     —       —   Expense not deductible     —       4.3 %     7.0 % Temporary not recognized     14.1 %     0.3 %     0.4 % Tax concession     (0.3 )%     (1.1 )%     (2.9 )% Effective tax rate     24.2 %     19.4 %     23.1 %   Deferred tax   Significant components of deferred tax were as follows:       As of December 31,       2022     2023     2023       HKD     HKD     US$   Deferred tax assets     7,876       7,876       1,008   Transferred to consolidated statements of income     —       (7,876 )     (1,008 ) Valuation allowance     —       —       —   Net deferred tax assets     7,876       —       —     The Group did not recognize any valuation allowance against its deferred tax asset as management believes the Group will be able to full utilize the assets in the foreseeable future.

Risks and Uncertainties	12 Months Ended
	Dec. 31, 2023
Risks And Uncertainties [Abstract]
RISKS AND UNCERTAINTIES	16. riskS AND UNCERTAINTIES   Credit risk   Our assets that potentially subject to a significant concentration of credit risk primarily consist of cash and accounts receivable.   We believe that there is no significant credit risk associated with cash in Hong Kong, which were held by reputable financial institutions in the jurisdiction where Neo-Concept HK is located. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately US$64,090) if the bank with which an individual/a company hold its eligible deposit fails. As of December 31, 2023, cash balance of HKD 913,267 (approximately US$116,922) was maintained at financial institutions in Hong Kong and approximately HKD 500,000 was insured by the Hong Kong Deposit Protection Board.   As of December 31, 2023, HKD4,936,039 (approximately US$631,942) was deposited with financial institutions located in UK, which was substantially insured under the Financial Services Compensation Scheme. Accordingly, it is not exposed to significant credit risk.   We have designed credit policies with an objective to minimize their exposure to credit risk. Our accounts receivable is short term by nature and the associated risk is minimal. We conduct credit evaluations on our clients and generally do not require collateral or other security from such clients. We periodically evaluate the creditworthiness of the existing clients in determining an allowance for doubtful accounts primarily based upon the age of the receivables and factors surrounding the credit risk of specific clients.   We are also exposed to risk from account receivables. These assets are subjected to credit evaluations. An allowance, where applicable, would make for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.   Customer concentration risk   For the year ended December 31, 2021, one customer accounted for 94.5% of our total revenue. For the year ended December 31, 2022, one customer accounted for 91.4% of our total revenue. For the year ended December 31, 2023, one customer accounted for 71.3% of our total revenue. No other customer accounts for more than 10% of our revenue for the years ended December 31, 2021, 2022 and 2023.   As of December 31, 2022, one customer accounted for 83.2% of the total balance of accounts receivable. As of December 31, 2023, four customers accounted for 44.7%, 21.6%, 11.0% and 10.1% of the total balance of accounts receivable. No other customer accounts for more than 10% of our accounts receivable as of December 31, 2022 and 2023.   Vendor concentration risk   For the year ended December 31, 2021, two vendors accounted for 86.5% and 13.5% of our total purchases. For the year ended December 31, 2022, two vendors accounted for 44.2% and 35.9% of our total purchases. For the year ended December 31, 2023, two vendors accounted for 69.3% and 24.6% of our total purchases. No other vendor accounts for more than 10% of our purchases for the years ended December 31, 2021, 2022 and 2023.   As of December 31, 2022, three vendors accounted for 44.8%, 41.6% and 13.6% of the total balance of accounts payable. No accounts payables as of December 31, 2023. No other vendor accounts for more than 10% of our accounts payable as of December 31, 2022 and 2023.   We focus on diversification of suppliers so as to minimize the vendor concentration risk.   Interest rate risk   Our exposure on fair value interest rate risk mainly arises from our fixed deposits with bank. We also have exposure on cash flow interest rate risk which is mainly arising from our deposits with banks and bank borrowings.   In respect of the exposure to cash flow interest rate risk arising from floating rate non-derivative financial instruments held by us, such as cash deposits and bank borrowings, at the end of the reporting period, we are not exposed to significant interest rate risk as the interest rates are not expected to change significantly.   Foreign currency risk   We are exposed to foreign currency risk primarily through sales that are denominated in a currency other than the functional currency of the operations to which they relate. The currencies giving rise to this risk are primarily US$. As HKD is currently pegged to US$, our exposure to foreign exchange fluctuations is minimal.   Market and geographic risk   The Company’s operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong, as well as the general state of Hong Kong’s economy may influence the Company’s business, financial condition, and results of operations.

Shareholders' Equity	12 Months Ended
	Dec. 31, 2023
Shareholders' Equity [Abstract]
SHAREHOLDERS’ EQUITY	17. Shareholders’ equity   Ordinary shares   For the sake of undertaking a public offering of the Company’s ordinary shares, the Company has performed a series of re-organizing transactions resulting in 11,250,000 shares of ordinary shares issued and outstanding that have been retroactively restated to the beginning of the first period presented. The Company only has one single class of ordinary shares that are accounted for as permanent equity.   On July 14, 2023, we effected a share split at a ratio of 1-to-1.6. As a result of the share split, we now have 800,000,000 authorized ordinary shares with a par value of US$0.0000625 per ordinary share and 18,000,000 ordinary shares issued and outstanding as of the date hereof.

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies [Abstract]
COMMITMENTS AND CONTINGENCIES	18. COMMITMENTS AND CONTINGENCIES   Litigation   From time to time, we are involved in claims and legal proceedings that arise in the ordinary course of business. Based on currently available information, we do not believe that the ultimate outcome of any unresolved matters, individually and in the aggregate, are reasonably possible to have a material adverse effect on our financial position, results of operations or cash flows. However, litigation is subject to inherent uncertainties and our view of these matters may change in the future. We record a liability when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We review the need for any such liabilities on a regular basis.

Subsequent Events	12 Months Ended
	Dec. 31, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	19. SUBSEQUENT EVENTS   The Company has assessed all events from December 31, 2023, up through May 14, 2024, which is the date of these unaudited interim condensed consolidated financial statements are available to be issued, except as disclosed below, there are no other material subsequent events that require disclosure in these unaudited interim condensed consolidated financial statements.   On April 23, 2024, the Company announced the closing of its IPO of 2,320,000 ordinary shares, US$0.0000625 par value per share at an offering price of US$4.00 per share.

Parent Only Financial Information	12 Months Ended
	Dec. 31, 2023
Parent Only Financial Information [Abstract]
PARENT ONLY FINANCIAL INFORMATION	20. PARENT ONLY FINANCIAL INFORMATION   The following presents condensed parent company only financial information of Neo-Concept International Group Holdings Limited.   Condensed balance sheets       As of December 31,       2022     2023     2023       HKD     HKD     US$   Current assets                   Amount due from the shareholder     8,775       8,775       1,125   Non-current assets                         Interests in a subsidiary     780       780       100   Total assets     9,555       9,555       1,225                             Liabilities and shareholders’ deficit                         Current liabilities                         Amounts due to a subsidiary     780       149,867       19,187   Amounts due to a related party     71,999       —       —   Total liabilities     72,779       149,867       19,187                             Shareholders’ deficit                         Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023; 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023     8,775       8,775       1,125   Accumulated losses     (71,999 )     (149,087 )     (19,087 ) Total shareholders’ deficit     (63,224 )     (140,312 )     (17,962 ) Total liabilities and shareholders’ deficit     9,555       9,555       1,225      Condensed statements of loss       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Operating expenses                         General and administrative expenses     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Total operating expenses     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Loss before income taxes     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Income taxes     —       —       —       —   Net loss     (29,999 )     (42,000 )     (77,088 )     (9,869 )   Condensed statements of cash flows       For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Cash flows from operating activities                         Net loss     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Changes in operating assets and liabilities     —       —       —       —   Net cash used in operating activities     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Cash flows from investing activities                                 Cash from (used in) investing activities     —       —       —       —   Cash flows from financing activities                                 Amount due to a related party     29,999       42,000       77,088       9,869   Cash flows from financing activities     29,999       42,000       77,088       9,869   Net increase (decrease) in cash and cash equivalents     —       —       —       —   Cash and cash equivalents at the beginning of the year     —       —       —       —   Cash and cash equivalents at the end of the year     —       —       —       —     (i) Basis of presentation   The Company was incorporated under the laws of the Cayman Islands as an exempted company with limited liability on July 29, 2021 and as a holding company.   Neo-Concept Apparel Group Limited (“NCA”), a British Virgin Island business company limited by shares, is the immediate holding company of Neo-Concept International Company Limited, which, in turn, holds the entire equity interests in Neo-Concept International Company Limited, a company incorporated in Hong Kong with limited liability, and Neo-Concept (NY) Corporation, a company incorporated in the United States of America with limited liability.   The equity interest of NCA was ultimately held as to 94% by Ms. Eva Yuk Yin Siu (“Ms. Siu”) and 6% by Ms. Man Chi Wai (“Ms. Wai”) through certain intermediate holding companies.   On October 29, 2021, the entire equity interest of NCA (representing 100 shares) was transferred to the Company by Ms. Siu and Ms. Wai in exchange for 100 shares of Neo-Concept (BVI) Limited, a then 100% held subsidiary of the Company, to Splendid Vibe Limited, a company incorporated in BVI and was held as to 94% by Ms. Siu and 6% by Ms. Wai ultimately. Accordingly, NCA became a wholly owned subsidiary of the Company.   In the condensed parent-company-only financial statements, the Company’s investment in NCA is stated at cost plus equity in undistributed earnings of NCA since the date of acquisition. The Company’s share of net loss of NCA is included in condensed statements of loss and comprehensive loss using the equity method. These condensed parent-company-only financial statements should be read in connection with the consolidated financial statements and notes thereto.   The condensed parent-company-only financial statements are presented as if the incorporation of the Company and its acquisition of NCA had taken place at January 1, 2020 and throughout the period as at the date before the Group Reorganization.   (ii) Restricted Net Assets   Schedule I of Rule 5-04 of Regulation S-X requires the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant’s proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party (i.e., lender, regulatory agency, foreign government, etc.).   The condensed parent company financial statements have to be prepared in accordance with Rule 12-04, Schedule I of Regulation S-X if the restricted net assets of the subsidiaries of Neo-Concept International Group Holdings Limited exceed 25% of the consolidated net assets of Neo-Concept International Group Holdings Limited. The abilities of the Company’s subsidiaries in Hong Kong, the United Kingdom and the United States to pay dividends are not restricted. In this connection, the restricted net assets of the subsidiaries of the Company does not exceed 25% of the consolidated net assets of the Company and accordingly the above condensed parent company only financial information of Neo-Concept International Group Holdings Limited is presented for the supplementary reference.   As of December 31, 2022 and 2023, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stocks or guarantees of the Company, except for those which have been separately disclosed in the consolidated financial statements, if any.

Accounting Policies, by Policy (Policies)	12 Months Ended
	Dec. 31, 2023
Summary of Significant Accounting Policies [Abstract]
Basis of presentation	Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for information pursuant to the rules and regulations of the Securities and Exchange Commission.
Principles of consolidation	Principles of consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.
Merger accounting for business combinations involving entities under common control	Merger accounting for business combinations involving entities under common control The consolidated financial statements incorporate the financial statements items of the combining entities or businesses in which the common control combination occurs as if they had been combined from the date when the combining entities or businesses first came under the control of the controlling parties. The net assets of the combining entities or businesses are combined using the existing book values from the controlling parties’ perspective. No amount is recognized in respect of goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination, to the extent of the continuation of the controlling parties’ interest. The combined statement of comprehensive income includes the results of each of the combining entities or businesses from the earliest date of presented or since the date when the combining entities or businesses first came under the common control, where this is a shorter period, regardless of the date of the common control combination.
Use of estimates and assumptions	Use of estimates and assumptions The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates relate to allowance for uncollectible accounts receivable, inventory valuation, useful lives and impairment for property and equipment, valuation allowance for deferred tax assets, fair value of financial instruments and contingencies. Actual results could vary from the estimates and assumptions that were used.
Functional currency and foreign currency translation	Functional currency and foreign currency translation We use Hong Kong dollars (“HKD”) as our reporting currency. The functional currency of the Company and its subsidiaries incorporated in the Cayman Islands and BVI is the United States dollar (“US$”) and the functional currency of the functional currency of its Hong Kong subsidiary is the Hong Kong dollar (“HKD”), and its UK subsidiary is the Pound Sterling (“GBP”). The determination of the respective functional currency is based on the criteria of Accounting Standards Codification (“ASC”) 830, Foreign Currency Matters. Transactions denominated in currencies other than functional currency are translated into functional currency at the exchange rates quoted by authoritative banks prevailing at the dates of the transactions. Exchange gains and losses resulting from those foreign currency transactions denominated in a currency other than the functional currency are recorded as other income (expense), net in the consolidated statements of comprehensive income. The financial statements of the Group are translated from the functional currency into HKD. Assets and liabilities are translated at the exchange rates at the balance sheet date. Equity accounts other than earnings generated in the current period are translated into HKD using the appropriate historical rates. Revenues and expenses, gains and losses are translated into HKD using the periodic average exchange rate for the year. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive income (expense) in the consolidated statements of comprehensive income.
Convenience translation	Convenience translation Translations of amounts in the consolidated balance sheet, consolidated statements of income and consolidated statements of cash flows from HKD into US$ as of and for the year ended December 31, 2023, are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = HKD 7.8109, as published in H.10 statistical release of the United States Federal Reserve Board. No representation is made that the HKD amounts could have been, or could be, converted, realized, or settled into US$ at such rate or at any other rate.
Cash and cash equivalents	Cash and cash equivalents We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.
Accounts receivable and allowance for expected credit losses	Accounts receivable and allowance for expected credit losses Accounts receivable, net are stated at the original amount less an allowance for expected credit loss on such receivables. The allowance for expected credit losses is estimated based upon our assessment of various factors including historical experience, the age of the accounts receivable balances, current general economic conditions, future expectations and customer specific quantitative and qualitative factors that may affect our customers’ ability to pay. An allowance is also made when there is objective evidence for us to reasonably estimate the amount of probable loss. The Company regularly reviews the adequacy and appropriateness of the allowance for doubtful accounts. The receivables are written off after all collection efforts have ceased.
Other non-current assets, net	Other non-current assets, net Other current assets are rental deposits.
Other current assets, net	Other current assets, net Other current assets, net primarily include deferred IPO costs, prepayments and others.
Inventories, net	Inventories, net Inventories, representing finished goods for sale, are stated at the lower of cost or net realizable value, using the weighted average method. We evaluate the need for impairment associated with obsolete, slow-moving, and non-saleable inventory by reviewing net realizable value on a periodic basis but at least annually. Only defective products are eligible for returning to our materials suppliers.
Property and equipment, net	Property and equipment, net Property and equipment are stated at cost less accumulated depreciation and any impairment losses. Major renewals, betterments, and improvements are capitalized to the asset accounts while replacements, maintenance, and repairs, which do not improve or extend the lives of the respective assets, are expensed to operations. At the time property and equipment are retired or otherwise disposed of, the asset and related accumulated depreciation are relieved of the applicable amounts. Gains or losses from retirements or sale are credited or charged to operations. We depreciate property and equipment using the straight-line method as follows: Leasehold improvement   Over the shorter of the terms of leases or 5 years when the renewal of leases is unconditional       Furniture, fixtures, and office equipment   6 years to 7 years
Intangible assets, net	Intangible assets, net Intangible assets are primarily purchased from third parties. Purchased intangible assets are initially recognized and measured at cost upon acquisition. Intangible assets that have determinable lives are amortized over their estimated useful lives based upon the usage of the asset, which is approximated using a straight-line method as follows: Computer software – Point-of-sale system   10 years
Impairment for long-lived assets	Impairment for long-lived assets Long-lived assets, representing property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. We assess the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, we would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of December 31, 2022 and 2023, no impairment of long-lived assets was recognized.
Fair value measurement	Fair value measurement The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by us. The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow: Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.
Accounts payable	Accounts payable Accounts payable represents trade payables to vendors.
Accruals and other payables	Accruals and other payables Accruals and other payables primarily include payroll payable, interest payable, VAT and other accrual and payables.
Leases	Leases Before January 1, 2020, we applied ASC Topic 840 (“ASC 840”), “Leases”, and each lease is classified at the inception date as either a capital lease or an operating lease. We adopted ASC 842, “Leases” (“ASC 842”) on January 1, 2020, using the modified retrospective transition method through a cumulative-effect adjustment in the period of adoption rather than retrospectively adjusting prior periods and the package of practical expedient. We categorized leases with contractual terms longer than twelve months as either operating or finance lease. The adoption of ASC 842 resulted in recognition of Operating Right-of-use (“ROU”) assets of HKD 541,625 and operating lease liabilities of and HKD 541,625 as of January 1, 2020. There is no impact to accumulated deficit at adoption. ROU assets represent our rights to use underlying assets for the lease terms and lease liabilities represent our obligation to make lease payments arising from the leases. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term, reduced by lease incentives received, plus any initial direct costs, using the discount rate for the lease at the commencement date. If the implicit rate in lease is not readily determinable for our operating leases, we generally use the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. We elected not to separate non-lease components from lease components; therefore, it will account for lease component and the non-lease components as a single lease component when there is only one vendor in the lease contract for the office leases. Lease payments are fixed.   For operating leases, lease expense is recognized on a straight-line basis in operations over the lease term. Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities on the consolidated balance sheets. Lease payments that depend on the future use of the leased property, such as sales volume during the lease term, are contingent rentals and, accordingly, are excluded from minimum lease payments in their entirety in accordance with ASC 840-10-25-5. Accordingly, these contingent rentals are excluded from the ROU assets and lease liabilities on the consolidated balance sheets. Lease payments of the Group’s retail stores located in the UK are charged based on the sales volume during the lease terms and therefore they are excluded from the recognition of ROU assets and lease liabilities on the consolidated balance sheets.
Bank borrowings	Bank borrowings Borrowings are initially recognized at fair value, net of upfront fees incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method.
Employee Benefit Plan	Employee benefit plan Payments to the Mandatory Provident Fund Scheme under the Hong Kong Mandatory Provident Fund Schemes Ordinance and state-managed retirement benefit schemes in other jurisdictions are recognized as an expense when employees have rendered service entitling them to the contributions.
Related parties	Related parties We adopted ASC 850, “Related Party Disclosures”, for the identification of related parties and disclosure of related party transactions. The details of related party transaction during the year ended December 31, 2021, 2022 and 2023, and balances as at December 31, 2022 and 2023 are set out in note 12.
Revenue Recognition	Revenue recognition We adopted ASC Topic 606, “Revenue from Contracts with Customers”, and all subsequent ASUs that modified ASC 606 on April 1, 2017, using the full retrospective method which requires us to present the financial statements for all periods as if Topic 606 had been applied to all prior periods. We derive revenue principally from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores. Revenue from contracts with customers is recognized using the following five steps: 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue when (or as) the entity satisfies a performance obligation.   A contract contains a promise (or promises) to transfer goods or services to a customer. A performance obligation is a promise (or a group of promises) that is distinct. The transaction price is the amount of consideration a company expects to be entitled from a customer in exchange for providing the goods or services. The unit of account for revenue recognition is a performance obligation (a good or service). A contract may contain one or more performance obligations. Performance obligations are accounted for separately if they are distinct. A good or service is distinct if the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and the good or service is distinct in the context of the contract. Otherwise, performance obligations are combined with other promised goods or services until we identify a bundle of goods or services that is distinct. Promises in contracts which do not result in the transfer of a good or service are not performance obligations, as well as those promises that are administrative in nature, or are immaterial in the context of the contract. We have addressed whether various goods and services promised to the customer represent distinct performance obligations. We applied the guidance of ASC Topic 606-10-25-16 through 18 in order to verify which promises should be assessed for classification as distinct performance obligations. Our revenues from sales of private-labelled apparel products and sales of own-branded apparel products in our retail stores and digital channels are recognized at a point in time. The transaction price is allocated to each performance obligation in the contract on the basis of the relative stand-alone selling prices of the promised goods or services. The individual standalone selling price of a good or service that has not previously been sold on a stand-alone basis, is determined based on the residual portion of the transaction price after allocating the transaction price to goods and/or services with observable stand-alone selling price. Transaction price is the amount of consideration in the contract to which we expect to be entitled in exchange for transferring the promised goods or services. The transaction price is fixed and is adjusted for time value of money if the contract includes a significant financing component. Consideration payable to a customer is deducted from the transaction price if we do not receive a separate identifiable benefit from the customer. Revenue is recognized at a point in time. Typically, performance obligation for products where the process is described as below, the performance obligation is satisfied at point in time. The Company currently generates its revenue from the following main sources: Sale of private-labelled apparel products-customized original design manufacturer We currently generate our revenue from the sale of private-labelled apparel products. We are an original design manufacturer. We offer customized design and manufacturing services to customers. We typically receive purchase orders from our customers who operate retail stores, which will set forth the terms and conditions including the transaction price, products to be delivered, terms of delivery, and terms of payment. The terms serve as the basis of the performance obligations that we must fulfil in order to recognize revenue. There is only one performance obligation as a series of services of this revenue stream are interrelated and are not separable or distinct as our customers cannot benefit from the standalone task (i.e. customers do not obtain any benefits other than the finished products). The key performance obligation is the delivery of the finished product to the customer at their specified location at which point title to that asset passes to the customer. The completion of this earning process is evidenced by a written customer acceptance indicating receipt of the product. Typical payment terms set forth in the purchase order ranges from 30 to 90 days from invoice date. The transaction price does not include variable consideration provision for right of return as we do not have sales return policy and no sales return is offered. No right of return is included in the revenue of the Company.   Retail sale of own-branded apparel products - “les 100 ciels” We currently generate our revenue from the sale of own-branded apparel products through our physical and digital channels. Retail revenue at a point of sale is measured at the fair value of the consideration received at the time the sale is made to the customer, net of discounts. Customers settle the consideration by cash or credit cards. For online sales, we have elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. Accordingly, we recognize revenue for our single performance obligation related to online sales at the time control of the merchandise passes to the customer, which is generally at the time of shipment. The transaction price includes variable consideration provision for right of return as we have sales return policy. We record an allowance for estimated merchandise returns based on our historical return patterns and various other assumptions that management believes to be reasonable. For the years ended December 31, 2021, 2022 and 2023, we are not aware of any material claims against us in relation to defective products, nor any material product returns from our customers. Following the adoption of ASC 606, we considered the guidance set forth in ASC 340-40, and determined that an asset would be recognized from costs incurred to fulfill a contract under ASC 340-40-25-5 only if those costs meet all of the following criteria: ● The costs relate directly to a contract or an anticipated contract that the entity can specifically identify (for example, costs relating to services to be provided under the renewal of an existing contract or costs of designing an asset to be transferred under a specific contract that has not yet been approved). ● The costs generate or enhance resources of the entity that will be used in satisfying (or continuing to satisfy) performance obligations in the future. ● The costs are expected to be recovered. The Company elected to apply the practical expedient to recognize the incremental costs of obtaining a contract as an expense if the amortization period of the asset would have been one year or less. Costs that relate directly to a contract include cost of purchasing of private-labelled and own-branded apparel products from suppliers. We elected to treat shipping and handling costs undertaken by the Company after the customer has obtained control of the related goods as a fulfillment activity and present as transportation costs in selling and marketing expenses. Costs associated with the production of advertising, such as writing, printing, and other costs, are expensed as incurred. Costs associated with communicating advertising that has been produced, such as magazine costs, are expensed when the advertising event takes place.
Cost of revenues	Cost of revenues Cost of revenues of private-labelled apparel products and cost of revenues of own-branded apparel products in our retail stores, which are directly related to revenue-generating transactions, primarily consist of cost of purchasing of private-labelled and own-branded apparel products from suppliers, and inbound shipping and handling cost.
Selling and marketing expenses	Selling and marketing expenses Selling and marketing expenses consist primarily of transportation and distribution expenses and marketing and displaying expenses.
General and administrative expenses	General and administrative expenses General and administrative expenses primarily consist of personnel-related compensation expenses, including salaries and related social insurance costs for our operations and supporting personnel, office rental and office expenses, insurance, amortization of intangible assets, write-down of inventories, allowance for doubtful debts, depreciation, professional services fees, and other expenses related to general operations. Shipping and handling costs Shipping and handling costs are expensed as incurred. Inbound shipping and handling costs associated with bringing the products from suppliers to the Company’s retail stores are included in cost of revenues. Outbound shipping and handling costs associated with shipping and delivery the products to customers are included in selling and marketing expenses.
Government grants	Government grants Government grants are recognized as income in other income or as a reduction of specific costs and expenses for which the grants are intended to compensate. Such amounts are recognized in the consolidated statements of comprehensive income upon receipt and when all conditions attached to the grants, such as companies are required to stay in the same level of employment, are fulfilled.
Income taxes	Income taxes We account for income taxes pursuant to ASC Topic 740, “Income Taxes”. Income taxes are provided on an asset and liability approach for financial accounting and reporting of income taxes. Any tax paid by subsidiaries during the year is recorded. Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or disallowable for income tax purpose and is calculated using tax rates that have been enacted or substantively enacted at the balance sheet date. ASC Topic 740 also requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statements and the tax basis of assets and liabilities, and for the expected future tax benefit to be derived from tax losses and tax credit carry-forwards. ASC Topic 740 additionally requires the establishment of a valuation allowance to reflect the likelihood of realization of deferred tax assets. Realization of deferred tax assets, including those related to the U.S. net operating loss carry-forwards, are dependent upon future earnings, if any, of which the timing and amount are uncertain. We adopted ASC Topic 740-10-05, “Income Tax”, which provides guidance for recognizing and measuring uncertain tax positions, it prescribes a threshold condition that a tax position must meet for any of the benefits of the uncertain tax position to be recognized in the consolidated financial statements. It also provides accounting guidance on derecognizing, classification, and disclosure of these uncertain tax positions. Our policy on classification of all interest and penalties related to unrecognized income tax positions, if any, is to present them as a component of income tax expenses.
Value added tax (“VAT”)	Value added tax (“VAT”) Our subsidiary in UK is subject to VAT and related surcharges on revenue generated from sale of products. The Group records revenue net of VAT. Entities that are VAT general taxpayers are allowed to offset qualified input VAT, paid to suppliers against their output VAT liabilities. The primary applicable rate of the United Kingdom VAT is 20% for the years ended December 31, 2021, 2022 and 2023.
Comprehensive Income	Comprehensive income  We present comprehensive income in accordance with ASC Topic 220, “Comprehensive Income”. ASC Topic 220 states that all items that are required to be recognized under accounting standards as components of comprehensive income be reported in the consolidated financial statements. The components of comprehensive income were the net income for the years and the foreign currency translation adjustments.
Commitments and Contingencies	Commitments and contingencies In the normal course of business, we are subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. We recognize a liability for such contingency if it determines it is probable that a loss has occurred, and a reasonable estimate of the loss can be made. We may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.
Earnings per share	Earnings per share We compute earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options, and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. For the years ended December 31, 2021, 2022 and 2023, there were no dilutive shares.
Recently issued accounting pronouncements	Recently issued accounting pronouncements In November 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures. The purpose of the update was to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis for all public entities to enable investors to develop more decision-useful financial analyses. The amendments in this ASU are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all periods presented in the consolidated financial statements. Management is evaluating the impact on the Company’s consolidated financial statements.   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which requires disclosure of incremental income tax information within the rate reconciliation and expanded disclosures of income taxes paid, among other disclosure requirements. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company’s management does not believe the adoption of ASU 2023-09 will have a material impact on its consolidated financial statements and disclosures. Except as mentioned above, we do not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on our consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

Organization and Principal Activities (Tables)	12 Months Ended
	Dec. 31, 2023
Organization and Principal Activities [Abstract]
Schedule of Group Reorganization	Upon the Group Reorganization and as at the date of this report, details of the subsidiary companies are as follows: Name   Background   Ownership Neo-Concept Apparel Group Limited   ●   A BVI company   ●   Incorporated in August 2008   ●   Issued Share Capital of US$100   ●   Intermediate holding company   100% owned by NCI   Name   Background   Ownership Neo-Concept International Company Limited   ●   A Hong Kong company   ●   Incorporated in October 1992   ●   Issued Share Capital of HKD 100,000   ●   Provision of one-stop apparel solution services   100% owned by NCA           Neo-Concept (UK) Limited   ●   A UK company   ●   Incorporated in August 2000   ●   Issued Share Capital of GBP100   ●   Provision of online and offline retail sales of apparel products   100% owned by Neo-Concept HK

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2023
Summary of Significant Accounting Policies [Abstract]
Schedule of Depreciate Property and Equipment Using the Straight-Line Method	We depreciate property and equipment using the straight-line method as follows: Leasehold improvement   Over the shorter of the terms of leases or 5 years when the renewal of leases is unconditional       Furniture, fixtures, and office equipment   6 years to 7 years
Schedule of Intangible Assets Estimated Useful Lives	Intangible assets that have determinable lives are amortized over their estimated useful lives based upon the usage of the asset, which is approximated using a straight-line method as follows: Computer software – Point-of-sale system   10 years

Inventories, Net (Tables)	12 Months Ended
	Dec. 31, 2023
Inventory Disclosure [Abstract]
Schedule of Inventories, Net	Inventories, net are comprised of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Own-branded apparel products     1,299,895       5,388,735       689,899   Less: inventory provision     —       (68,536 )     (8,774 ) Total     1,299,895       5,320,199       681,125

Accounts Receivable, Net (Tables)	12 Months Ended
	Dec. 31, 2023
Accounts Receivable, Net [Abstract]
Schedule of Accounts Receivable, Net	Accounts receivable, net is comprised of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Accounts receivable – excluding due from factor     6,114,794       33,758,410       4,321,962   Accounts receivable – due from factor     4,255,894       —       —   Allowance for expected credit losses     (31,502 )     (1,414,818 )     (181,134 ) Total     10,339,186       32,343,592       4,140,828
Schedule of Allowance for Doubtful Accounts, Net Consists	Allowance for expected credit losses, net consists of the following:     2022     2023     2023       HKD     HKD     US$   Beginning balance, January 1     31,502       31,502       4,033   Addition     —       1,383,316       177,101   Ending balance, December 31     31,502       1,414,818       181,134

Other Current Assets, Net (Tables)	12 Months Ended
	Dec. 31, 2023
Other Current Assets, Net [Abstract]
Schedule of Other Current Assets	Other current assets, net consist of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Deferred IPO costs     4,229,639       8,148,021       1,043,160   Prepayments     129,229       12,021,838       1,539,110   Others     21,996       55,863       7,155   Total     4,380,864       20,225,722       2,589,425

Property and Equipment, Net (Tables)	12 Months Ended
	Dec. 31, 2023
Property and Equipment, Net [Abstract]
Schedule of Property and Equipment, Net	Property and equipment, net consist of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Furniture, fixtures, and office equipment     556,991       603,082       77,210   Leasehold improvement     —       2,169,258       277,722   Total     556,991       2,772,340       354,932   Less: accumulated depreciation     (502,065 )     (1,474,658 )     (188,795 ) Property and equipment, net     54,926       1,297,682       166,137

Intangible Assets, Net (Tables)	12 Months Ended
	Dec. 31, 2023
Intangible Assets, Net [Abstract]
Schedule of Intangible Assets, Net	Intangible assets, net consist of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Software     1,277,753       1,277,753       163,586   Less: accumulated amortization     (1,165,704 )     (1,277,753 )     (163,586 ) Intangible assets, net     112,049       —       —

Accruals and Other Payables (Tables)	12 Months Ended
	Dec. 31, 2023
Accruals and Other Payables [Abstract]
Schedule of Accruals and Other Payables	Accruals and other payables consist of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Payroll payable     734,454       2,185,617       279,816   Interest payable     412,442       46,397       5,940   VAT     905,214       834,902       106,889   Others     190,505       138,789       17,768   Total     2,242,615       3,205,705       410,413

Bank Borrowings (Tables)	12 Months Ended
	Dec. 31, 2023
Bank Borrowings [Abstract]
Schedule of Outstanding Balances of Bank Borrowings	Outstanding balances of bank borrowings as of December 31, 2022, and 2023 consisted of the following:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Bank borrowings:                   Guaranteed     375,059       —       —   Collateralized and guaranteed     83,962,426       30,753,400       3,937,242         84,337,485       30,753,400       3,937,242   Less: current maturities     (83,962,426 )     (30,753,400 )     (3,937,242 ) Non-current maturities     375,059       —       —
Schedule of Bank Borrowings	Bank borrowings as of December 31, 2022 and 2023 are as follows:         Maturity       Interest   Interest   As of December 31,   Lender   Type   date   Currency   rate as of December 31, 2022   rate as December 31, 2023   2022     2023     2023                           HKD     HKD     US$   DBS Bank (Hong Kong) Limited (i)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     17,232,296       5,884,863       753,417   The Hongkong and Shanghai Banking Corporation Limited (i)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     44,500,679       21,568,885       2,761,383   Dah Sing Bank, Limited (i)   Overdraft   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     22,229,451       —       —   Citibank, N.A., Hong Kong Branch (ii)   Trading finance   Within 1 year   HKD   Bank prevailing rates   Bank prevailing rates     —       3,299,652       422,442   HSBC UK Bank plc (iii)   Term loan   June 15, 2026   GBP   2.5%   —     375,059       —       —   Total                         84,337,485       30,753,400       3,937,242   Less: current maturities                         (83,962,426 )     (30,753,400 )     (3,937,242 ) Non-current maturities                         375,059       —       —     (i) In connection with our operations in Hong Kong, Neo-Concept HK, together with a related company, Neo-Concept (Holdings) Company Limited (“NCH”), a company incorporated in Hong Kong and controlled by Ms. Siu, entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH combinedly. The banking facilities were secured, details of which are set out as follows: (a) Unlimited personal guarantee by Ms. Siu; (b) Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH; (c) Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces; (d) Legal charge over certain deposits accounts held by NCH at the relevant banks;   (e) Legal charge over certain investment funds held by NCH at the relevant banks; (f) Assignment of benefit from life insurances premium assets held by NCH at the relevant banks; (g) Assignment of benefit from life insurances premium assets held by Pure Diamond Limited, a related company in which Ms. Siu has interests, at a relevant bank; (h) Indemnity granted by NCH to relevant banks; (i) Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and (j) Cross-corporate guaranteed by Neo-Concept HK and NCH; (ii) The banking facilities were secured, details of which are set out as follows:   (a) Personal guarantee by Ms. Siu and an immediate family member of Ms. Siu;   (b) Cross-corporate guaranteed by Neo-Concept HK, Neo-Concept (BVI) Limited, a company controlled by Ms. Siu, and NCH; and         (c) Legal charge over certain deposits accounts held by NCH at the relevant banks; (iii) The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.
Schedule of Bank Loan	Loan type in terms of currency   Carrying value     Carrying value     Within 1 year     2024     2025     2026     2027       HKD     US$     HKD     HKD     HKD     HKD     HKD   in HKD     83,962,426       10,749,392       83,962,426       —       —       —       —   in GBP     375,059       48,017       —       —       —       375,059       —   December 31, 2022     84,337,485       10,797,409       83,962,426       —       —       375,059       —   Loan type in terms of currency   Carrying value     Carrying value     Within 1 year     2025     2026     2027     2028       HKD     US$     HKD     HKD     HKD     HKD     HKD   in HKD     30,753,400       3,937,242       30,753,400       —       —       —       —   in GBP     —       —       —       —       —       —       —   December 31, 2023     30,753,400       3,937,242       30,753,400       —       —       —       —

Right-of-use Assets and Lease Liabilities (Tables)	12 Months Ended
	Dec. 31, 2023
Right-Of-Use Assets and Lease Liabilities [Abstract]
Schedule of Supplemental Balance Sheet Information Related to Operating Leases	Supplemental balance sheet information related to operating leases was as follows:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Operating lease:                   Operating lease right-of-use assets     653,344       23,884,854       3,057,888   Current operating lease obligation     653,344       708,829       90,750   Non-current operating lease obligation     —       23,176,025       2,967,138   Total operating lease obligation     653,344       23,884,854       3,057,888
Schedule of Undiscounted Future Minimum Lease Payment	The undiscounted future minimum lease payment schedule as follows: For the years ending December 31,   HK$     US$   2024     2,014,564       257,917   2025     2,678,490       342,917   2026     2,834,708       362,917   2027     3,023,467       387,083   2028 or after     15,006,137       1,921,179   Total lease payments     25,557,366       3,272,013   Less: imputed interest     (1,672,512 )     (214,125 ) Total operating lease liabilities     23,884,854       3,057,888
Schedule of Other Supplemental Information about the Company’s Operating Lease	Other supplemental information about the Company’s operating lease as of:     December 31, 2023   Weighted average discount rate     7.91 % Weighted average remaining lease term (years)     9.0

Related Party Balances and Transactions (Tables)	12 Months Ended
	Dec. 31, 2023
Related Party Balances and Transactions [Abstract]
Schedule of Due from Related Parties	Due from related parties consist of the following:         As of December 31,       Relationship   2022     2023     2023           HKD     HKD     US$   Due from Ms. Siu   Controlling Shareholder     70,001       —       —   Due from NCH   Common controlled by Ms. Siu     16,202,732       —       —   Due to related parties consist of the following:         As of December 31,       Relationship   2022     2023     2023           HKD     HKD     US$   Due to Ms. Siu   Controlling Shareholder     —       (59,106 )     (7,567 ) Due to NCH   Common controlled by Ms. Siu     —       (34,184,138 )     (4,376,466 )
Schedule of Related Party Transactions	In addition to the transactions and balances detailed elsewhere in these consolidated financial statements, we also had the following transactions with related parties:     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Agency income received by Neo-Concept UK from NCH     2,904,339       2,586,019       2,662,034       340,810   Purchase of apparel products from NCH     29,522,341       103,159,420       34,213,521       4,380,228   Rental expense paid to NCH     —       720,000       720,000       92,179   Management fee paid to NCH     4,223,236       —       —       —

Dissagreggated Revenue (Tables)	12 Months Ended
	Dec. 31, 2023
Dissagreggated Revenue [Abstract]
Schedule of Disaggregated Revenue by Major Product Categories	The following table shows disaggregated revenue by major product categories for the years ended December 31, 2021, 2022, and 2023, respectively:     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Sale of private-labelled apparel products     237,282,262       336,306,554       156,316,352       20,012,592   Retail sale of own-branded apparel products     3,254,265       11,145,014       17,886,275       2,289,912   Total     240,536,527       347,451,568       174,202,627       22,302,504         For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Sale of private-labelled apparel products     216,523,165       301,429,220       134,239,759       17,186,208   Retail sale of own-branded apparel products     1,420,257       4,187,387       4,914,557       629,193   Total     217,943,422       305,616,607       139,154,316       17,815,401
Schedule of Breakdown of Gross Profit and Gross Profit Margin	The following table sets forth a breakdown of our gross profit and gross profit margin for years ended December 31, 2021, 2022, and 2023:     For the year ended December 31, 2023   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     156,316,352       134,239,759       22,076,593       14.1 % Own-branded apparel products     17,886,275       4,914,557       12,971,718       72.5 % Total     174,202,627       139,154,316       35,048,311       20.1 %     For the year ended December 31, 2022   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     336,306,554       301,429,220       34,877,334       10.4 % Own-branded apparel products     11,145,014       4,187,387       6,957,627       62.4 % Total     347,451,568       305,616,607       41,834,961       12.0 %     For the year ended December 31, 2021   Product category   Revenue     Cost of revenue     Gross profit     Gross profit margin       HKD     HKD     HKD     %   Private-labelled apparel products     237,282,262       216,523,165       20,759,097       8.7 % Own-branded apparel products     3,254,265       1,420,257       1,834,008       56.4 % Total     240,536,527       217,943,422       22,593,105       9.4 %
Schedule of Revenue is Disaggregated by the Geographical Locations	In the following table, revenue is disaggregated by the geographical locations of customers:     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Geographical locations:                         The United States and Canada     235,568,451       328,293,299       132,124,783       16,915,437   The UK     3,080,163       11,145,014       17,898,073       2,291,423   Others     1,887,913       8,013,255       24,179,771       3,095,644   Total     240,536,527       347,451,568       174,202,627       22,302,504

Other Income (Tables)	12 Months Ended
	Dec. 31, 2023
Other Income [Abstract]
Schedule of Other Income	Other income consists of the followings:     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Government subsidies   2,313,438     —     —     —   Agency income     2,904,339       2,586,019       2,662,034       340,810   Others     —       —       326       42   Total     5,217,777       2,586,019       2,662,360       340,852

Taxes (Tables)	12 Months Ended
	Dec. 31, 2023
Taxes [Abstract]
Schedule of Provision for Income Taxes	Significant components of the provision for income taxes are as follows:     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Current:                         Hong Kong     1,742,282       2,979,918       928,973       118,941   The UK     —       —       388,288       49,703   Deferred:                                 Hong Kong     —       —       7,876       1,008   Total provision for income taxes     1,742,282       2,979,918       1,325,137       169,652
Schedule of Reconciles Cayman Islands Statutory Rates	The following table reconciles Cayman Islands statutory rates to our effective tax rate:     For the years ended December 31,       2021     2022     2023   Income tax rate in the Cayman Islands, permanent tax holiday     0       0       0   Hong Kong statutory income tax rate     16.5 %     16.5 %     16.5 % Effect of different tax rates     (0.8 )%     (0.6 )%     2.1 % Income not taxable     (5.3 )%     —       —   Expense not deductible     —       4.3 %     7.0 % Temporary not recognized     14.1 %     0.3 %     0.4 % Tax concession     (0.3 )%     (1.1 )%     (2.9 )% Effective tax rate     24.2 %     19.4 %     23.1 %
Schedule of Significant Components of Deferred Tax	Significant components of deferred tax were as follows:     As of December 31,       2022     2023     2023       HKD     HKD     US$   Deferred tax assets     7,876       7,876       1,008   Transferred to consolidated statements of income     —       (7,876 )     (1,008 ) Valuation allowance     —       —       —   Net deferred tax assets     7,876       —       —

Parent Only Financial Information (Tables)	12 Months Ended
	Dec. 31, 2023
Parent Only Financial Information [Abstract]
Schedule of Condensed Balance Sheets	Condensed balance sheets     As of December 31,       2022     2023     2023       HKD     HKD     US$   Current assets                   Amount due from the shareholder     8,775       8,775       1,125   Non-current assets                         Interests in a subsidiary     780       780       100   Total assets     9,555       9,555       1,225                             Liabilities and shareholders’ deficit                         Current liabilities                         Amounts due to a subsidiary     780       149,867       19,187   Amounts due to a related party     71,999       —       —   Total liabilities     72,779       149,867       19,187                             Shareholders’ deficit                         Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023; 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023     8,775       8,775       1,125   Accumulated losses     (71,999 )     (149,087 )     (19,087 ) Total shareholders’ deficit     (63,224 )     (140,312 )     (17,962 ) Total liabilities and shareholders’ deficit     9,555       9,555       1,225
Schedule of Condensed Statements of Loss and Comprehensive Loss	Condensed statements of loss     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Operating expenses                         General and administrative expenses     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Total operating expenses     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Loss before income taxes     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Income taxes     —       —       —       —   Net loss     (29,999 )     (42,000 )     (77,088 )     (9,869 )
Schedule of Condensed Statements of Cash Flows	Condensed statements of cash flows     For the years ended December 31,       2021     2022     2023     2023       HKD     HKD     HKD     US$   Cash flows from operating activities                         Net loss     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Changes in operating assets and liabilities     —       —       —       —   Net cash used in operating activities     (29,999 )     (42,000 )     (77,088 )     (9,869 ) Cash flows from investing activities                                 Cash from (used in) investing activities     —       —       —       —   Cash flows from financing activities                                 Amount due to a related party     29,999       42,000       77,088       9,869   Cash flows from financing activities     29,999       42,000       77,088       9,869   Net increase (decrease) in cash and cash equivalents     —       —       —       —   Cash and cash equivalents at the beginning of the year     —       —       —       —   Cash and cash equivalents at the end of the year     —       —       —       —

Organization and Principal Activities (Details) - shares	Oct. 29, 2021	Dec. 31, 2023
Splendid Vibe Limited [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of subsidiary	100.00%
Ms. Eva Yuk Yin Siu [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of subsidiary	94.00%
Ms. Man Chi Wai [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of subsidiary	6.00%
Ms. Eva Yuk Yin Siu [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of equity interest		94.00%
Ms. Man Chi Wai [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of equity interest		6.00%
Neo-Concept Apparel Group Limited [Member]
Organization and Principal Activities (Details) [Line Items]
Transfer share (in Shares)	100
Percentage of issued shares	100.00%
BVI [Member]
Organization and Principal Activities (Details) [Line Items]
Transfer share (in Shares)	100
Percentage of issued shares	100.00%
Ms. Eva Yuk Yin Siu [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of incorporated	94.00%
Ms. Man Chi Wai [Member]
Organization and Principal Activities (Details) [Line Items]
Percentage of incorporated	6.00%

Organization and Principal Activities (Details) - Schedule of Group Reorganization	12 Months Ended
	Dec. 31, 2023
Neo-Concept Apparel Group Limited [Member]
Schedule of Group Reorganization [Line Items]
Background	●   A BVI company   ●   Incorporated in August 2008   ●   Issued Share Capital of US$100   ●   Intermediate holding company
Ownership	100% owned by NCI
Neo-Concept International Company Limited [Member]
Schedule of Group Reorganization [Line Items]
Background	●   A Hong Kong company   ●   Incorporated in October 1992   ●   Issued Share Capital of HKD 100,000   ●   Provision of one-stop apparel solution services
Ownership	100% owned by NCA
Neo-Concept (UK) Limited [Member]
Schedule of Group Reorganization [Line Items]
Background	●   A UK company   ●   Incorporated in August 2000   ●   Issued Share Capital of GBP100   ●   Provision of online and offline retail sales of apparel products
Ownership	100% owned by Neo-Concept HK

Summary of Significant Accounting Policies (Details)	12 Months Ended
	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Jan. 01, 2020 HKD ($)
Summary of Significant Accounting Policies (Details) [Line Items]
Noon buying rate (in Dollars)	$ 1
Right-of-use assets (in Dollars)		$ 653,344		$ 23,884,854	$ 3,057,888	$ 541,625
Lease liabilities (in Dollars)						$ 541,625
Value Added Tax	20.00%	20.00%	20.00%
HONG KONG
Summary of Significant Accounting Policies (Details) [Line Items]
Foreign currency exchange rate, translation				7.8109	7.8109

Schedule of Depreciate Property and Equipment Using the Straight-Line Method (Details) - Schedule of Depreciate Property and Equipment Using the Straight-Line Method	Dec. 31, 2023
Schedule of Depreciate Property and Equipment Using the Straight-Line Method (Details) - Schedule of Depreciate Property and Equipment Using the Straight-Line Method [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Furniture, Fixtures, and Office Equipment [Member] | Minimum [Member]
Schedule of Depreciate Property and Equipment Using the Straight-Line Method (Details) - Schedule of Depreciate Property and Equipment Using the Straight-Line Method [Line Items]
Property, Plant and Equipment, Useful Life	6 years
Furniture, Fixtures, and Office Equipment [Member] | Maximum [Member]
Schedule of Depreciate Property and Equipment Using the Straight-Line Method (Details) - Schedule of Depreciate Property and Equipment Using the Straight-Line Method [Line Items]
Property, Plant and Equipment, Useful Life	7 years

Schedule of Intangible Assets Estimated Useful Lives (Details) - Schedule of Intangible Assets Estimated Useful Lives	Dec. 31, 2023
Computer Software, Intangible Asset [Member]
Schedule of Intangible Assets Estimated Useful Lives (Details) - Schedule of Intangible Assets Estimated Useful Lives [Line Items]
Finite-Lived Intangible Asset, Useful Life	10 years

Segment information (Details)	12 Months Ended
	Dec. 31, 2023 segment
Segment Information [Abstract]
Operating segment	1

Inventories, Net (Details)	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Inventory Disclosure [Abstract]
Inventory write-down expense	$ 68,536	$ 8,774

Inventories, Net (Details) - Schedule of Inventories, Net	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Inventories Net [Abstract]
Total	$ 5,320,199	$ 681,125	$ 1,299,895
Less: inventory provision	(68,536)	(8,774)
Own-branded apparel products [Member]
Schedule of Inventories Net [Abstract]
Total	$ 5,388,735	$ 689,899	$ 1,299,895

Accounts Receivable, Net (Details) - Schedule of Accounts Receivable, Net	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Accounts Receivable Net [Abstract]
Accounts receivable – excluding due from factor	$ 33,758,410	$ 4,321,962	$ 6,114,794
Accounts receivable – due from factor			4,255,894
Allowance for expected credit losses	(1,414,818)	(181,134)	(31,502)
Total	$ 32,343,592	$ 4,140,828	$ 10,339,186

Accounts Receivable, Net (Details) - Schedule of Allowance for Doubtful Accounts, Net Consists	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Allowance For Doubtful Accounts Net Consists [Abstract]
Beginning balance, January 1	$ 31,502	$ 4,033	$ 31,502
Addition	1,383,316	177,101
Ending balance, December 31	$ 1,414,818	$ 181,134	$ 31,502

Other Current Assets, Net (Details) - Schedule of Other Current Assets - Other Current Assets [Member]	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Other Current Assets, Net (Details) - Schedule of Other Current Assets [Line Items]
Deferred IPO costs	$ 8,148,021	$ 1,043,160	$ 4,229,639
Prepayments	12,021,838	1,539,110	129,229
Others	55,863	7,155	21,996
Total	$ 20,225,722	$ 2,589,425	$ 4,380,864

Property and Equipment, Net (Details)	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Property and Equipment, Net [Abstract]
Depreciation expenses	$ 33,091	$ 4,237	$ 11,114	$ 136,236

Property and Equipment, Net (Details) - Schedule of Property and Equipment, Net	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Property and Equipment, Net [Line Items]
Property plant and equipment gross	$ 2,772,340	$ 354,932	$ 556,991
Less: accumulated depreciation	(1,474,658)	(188,795)	(502,065)
Property and equipment, net	1,297,682	166,137	54,926
Furniture, fixtures, and office equipment [Member]
Schedule of Property and Equipment, Net [Line Items]
Property plant and equipment gross	603,082	77,210	556,991
Leasehold improvement [Member]
Schedule of Property and Equipment, Net [Line Items]
Property plant and equipment gross	$ 2,169,258	$ 277,722

Intangible Assets, Net (Details)	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Intangible Assets, Net [Abstract]
Amortization recognized	$ 112,049	$ 14,345	$ 137,358	$ 151,634

Intangible Assets, Net (Details) - Schedule of Intangible Assets, Net	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Intangible Assets, Net [Abstract]
Software	$ 1,277,753	$ 163,586	$ 1,277,753
Less: accumulated amortization	(1,277,753)	(163,586)	(1,165,704)
Intangible assets, net			$ 112,049

Accruals and Other Payables (Details) - Schedule of Accruals and Other Payables	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Accruals and Other Payables [Abstract]
Payroll payable	$ 2,185,617	$ 279,816	$ 734,454
Interest payable	46,397	5,940	412,442
VAT	834,902	106,889	905,214
Others	138,789	17,768	190,505
Total	$ 3,205,705	$ 410,413	$ 2,242,615

Bank Borrowings (Details) - HKD ($) $ in Millions	12 Months Ended
	Dec. 31, 2023	Jun. 30, 2020
Bank Borrowings [Line Items]
Guaranteed amounting	$ 131
Loan tenure		6 years
Fixed interest rate		2.50%

Bank Borrowings (Details) - Schedule of Outstanding Balances of Bank Borrowings - Borrowings [Member]	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Outstanding Balances of Bank Borrowings [Line Items]
Bank borrowings	$ 30,753,400	$ 3,937,242	$ 84,337,485
Less: current maturities	(30,753,400)	(3,937,242)	(83,962,426)
Non-current maturities			375,059
Guaranteed [Member]
Schedule of Outstanding Balances of Bank Borrowings [Line Items]
Bank borrowings			375,059
Collateralized and guaranteed [Member]
Schedule of Outstanding Balances of Bank Borrowings [Line Items]
Bank borrowings	$ 30,753,400	$ 3,937,242	$ 83,962,426

Bank Borrowings (Details) - Schedule of Bank Borrowings		12 Months Ended
		Dec. 31, 2023 HKD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2023 USD ($)
Debt Instrument [Line Items]
Bank borrowings, Total		$ 30,753,400	$ 84,337,485	$ 3,937,242
Less: current maturities		(30,753,400)	(83,962,426)	(3,937,242)
Non-current maturities			$ 375,059
DBS Bank (Hong Kong) Limited [Member]
Debt Instrument [Line Items]
Type	[1]	Trading finance
Maturity date	[1]	Within 1 year
Currency	[1]	HKD
Interest rate	[1]	Bank prevailing rates	Bank prevailing rates
Bank borrowings, Total	[1]	$ 5,884,863	$ 17,232,296	753,417
The Hongkong and Shanghai Banking Corporation Limited [Member]
Debt Instrument [Line Items]
Type	[1]	Trading finance
Maturity date	[1]	Within 1 year
Currency	[1]	HKD
Interest rate	[1]	Bank prevailing rates	Bank prevailing rates
Bank borrowings, Total	[1]	$ 21,568,885	$ 44,500,679	2,761,383
Dah Sing Bank, Limited [Member]
Debt Instrument [Line Items]
Type	[1]	Overdraft
Maturity date	[1]	Within 1 year
Currency	[1]	HKD
Interest rate	[1]	Bank prevailing rates	Bank prevailing rates
Bank borrowings, Total	[1]		$ 22,229,451
Citibank, N.A., Hong Kong Branch [Member]
Debt Instrument [Line Items]
Type	[2]
Maturity date	[2]
Currency	[2]
Interest rate	[2]
Bank borrowings, Total	[2]	$ 3,299,652		422,442
HSBC UK Bank plc [Member]
Debt Instrument [Line Items]
Type	[3]	Term loan
Maturity date	[3]	June 15, 2026
Currency	[3]	GBP
Interest rate	[3]		2.5%
Bank borrowings, Total	[3]		$ 375,059
[1] In connection with our operations in Hong Kong, Neo-Concept HK, together with a related company, Neo-Concept (Holdings) Company Limited (“NCH”), a company incorporated in Hong Kong and controlled by Ms. Siu, entered into (as renewed or supplemented yearly where required) several banking facilities with banks in Hong Kong for combined banking facilities which were shared by Neo-Concept HK and NCH combinedly. The banking facilities were secured, details of which are set out as follows: (a) Unlimited personal guarantee by Ms. Siu; (b) Ms. Siu being a subordinated lender towards all sums of money owed by Neo-Concept HK and NCH; (c) Legal charge over certain properties and car parking spaces owned by Ms. Siu and an immediate family member of Ms. Siu and also assignment of rental from the properties and the car parking spaces; (d) Legal charge over certain deposits accounts held by NCH at the relevant banks; (e) Legal charge over certain investment funds held by NCH at the relevant banks; (f) Assignment of benefit from life insurances premium assets held by NCH at the relevant banks; (g) Assignment of benefit from life insurances premium assets held by Pure Diamond Limited, a related company in which Ms. Siu has interests, at a relevant bank; (h) Indemnity granted by NCH to relevant banks; (i) Guaranteed by Neo-Concept Fashion (Zhongshan) Co., Ltd, a subsidiary company of NCH, amounting to HKD 131 million; and (j) Cross-corporate guaranteed by Neo-Concept HK and NCH; [2] The banking facilities were secured, details of which are set out as follows: (a) Personal guarantee by Ms. Siu and an immediate family member of Ms. Siu; (b) Cross-corporate guaranteed by Neo-Concept HK, Neo-Concept (BVI) Limited, a company controlled by Ms. Siu, and NCH; and (c) Legal charge over certain deposits accounts held by NCH at the relevant banks; [3] The loan was obtained in June 2020 having a tenure of 6 years with a fixed interest rate of 2.5% per annum. It was made under the Bounce Back Loan Scheme managed by the British Government (“BBLS Guarantee”). The BBLS Guarantee provides a full repayment guarantee to the lender on the loan.

Bank Borrowings (Details) - Schedule of Bank Loan	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule of Bank Loan [Line Items]
Carrying value	$ 30,753,400		$ 84,337,485
Within 1 year	3,937,242		10,797,409
2024			83,962,426
2025
2026	30,753,400
2027			375,059
2028
HKD [Member]
Schedule of Bank Loan [Line Items]
Carrying value	30,753,400		83,962,426
Within 1 year	3,937,242		10,749,392
2024			83,962,426
2025
2026	30,753,400
2027
2028
GBP [Member]
Schedule of Bank Loan [Line Items]
Carrying value			375,059
Within 1 year			48,017
2024
2025
2026
2027			$ 375,059
2028

Right-of-use Assets and Lease Liabilities (Details)	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)	Dec. 31, 2023 USD ($)	Jan. 01, 2020 HKD ($)
Right-of-use Assets and Lease Liabilities [Abstract]
Right-of-use assets	$ 23,884,854	$ 653,344		$ 3,057,888	$ 541,625
Associated lease liabilities					$ 541,625
Operating lease expense	$ 3,271,053	$ 2,580,711	$ 164,482

Right-of-use Assets and Lease Liabilities (Details) - Schedule of Supplemental Balance Sheet Information Related to Operating Leases	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Jan. 01, 2020 HKD ($)
Operating lease:
Operating lease right-of-use assets	$ 23,884,854	$ 3,057,888	$ 653,344	$ 541,625
Current operating lease obligation	708,829	90,750	653,344
Non-current operating lease obligation	23,176,025	2,967,138
Total operating lease obligation	$ 23,884,854	$ 3,057,888	$ 653,344

Right-of-use Assets and Lease Liabilities (Details) - Schedule of Undiscounted Future Minimum Lease Payment - Dec. 31, 2023	HKD ($)	USD ($)
Schedule of Undiscounted Future Minimum Lease Payment [Abstract]
2024	$ 2,014,564	$ 257,917
2025	2,678,490	342,917
2026	2,834,708	362,917
2027	3,023,467	387,083
2028 or after	15,006,137	1,921,179
Total lease payments	25,557,366	3,272,013
Less: imputed interest	(1,672,512)	(214,125)
Total operating lease liabilities	$ 23,884,854	$ 3,057,888

Right-of-use Assets and Lease Liabilities (Details) - Schedule of Other Supplemental Information about the Company’s Operating Lease	Dec. 31, 2023
Schedule of Other Supplemental Information about the Company’s Operating Lease [Abstract]
Weighted average discount rate	7.91%
Weighted average remaining lease term (years)	9 years

Related Party Balances and Transactions (Details) - Schedule of Due from Related Parties - Common controlled by Ms. Siu [Member]	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Ms. Siu [Member]
Schedue of Due from Related Parties [Line Items]
Due from related parties			$ 70,001
Due to related parties	(59,106)	(7,567)
NCH [Member]
Schedue of Due from Related Parties [Line Items]
Due from related parties			16,202,732
Due to related parties	$ (34,184,138)	$ (4,376,466)

Related Party Balances and Transactions (Details) - Schedule of Related Party Transactions	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Agency income received by Neo-Concept UK from NCH [Member]
Related Party Transaction [Line Items]
Management fee paid to NCH	$ 2,662,034	$ 340,810	$ 2,586,019	$ 2,904,339
Purchase of apparel products from NCH [Member]
Related Party Transaction [Line Items]
Management fee paid to NCH	34,213,521	4,380,228	103,159,420	29,522,341
Rental expense paid to NCH [Member]
Related Party Transaction [Line Items]
Management fee paid to NCH	720,000	92,179	720,000
Management fee paid to NCH [Member]
Related Party Transaction [Line Items]
Management fee paid to NCH				$ 4,223,236

Dissagreggated Revenue (Details) - Schedule of Disaggregated Revenue by Major Product Categories	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Schedule of Disaggregated Revenue by Major Product Categories [Line Items]
Disaggregated revenue	$ 174,202,627	$ 22,302,504	$ 347,451,568	$ 240,536,527
Disaggregated cost of revenue	139,154,316	17,815,401	305,616,607	217,943,422
Sale of private-labelled apparel products [Member]
Schedule of Disaggregated Revenue by Major Product Categories [Line Items]
Disaggregated revenue	156,316,352	20,012,592	336,306,554	237,282,262
Retail sale of own-branded apparel products [Member]
Schedule of Disaggregated Revenue by Major Product Categories [Line Items]
Disaggregated revenue	17,886,275	2,289,912	11,145,014	3,254,265
Sale of private-labelled apparel products [Member]
Schedule of Disaggregated Revenue by Major Product Categories [Line Items]
Disaggregated cost of revenue	134,239,759	17,186,208	301,429,220	216,523,165
Retail sale of own-branded apparel products [Member]
Schedule of Disaggregated Revenue by Major Product Categories [Line Items]
Disaggregated cost of revenue	$ 4,914,557	$ 629,193	$ 4,187,387	$ 1,420,257

Dissagreggated Revenue (Details) - Schedule of Breakdown of Gross Profit and Gross Profit Margin	9 Months Ended					12 Months Ended
	Dec. 31, 2023 HKD ($)	Mar. 31, 2023	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)	Mar. 31, 2021	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Schedule of Breakdown of Gross Profit and Gross Profit Margin [Line Items]
Revenue	$ 174,202,627		$ 347,451,568	$ 240,536,527		$ 174,202,627		$ 347,451,568	$ 240,536,527
Cost of revenue	139,154,316		305,616,607	217,943,422		139,154,316	$ 17,815,401	305,616,607	217,943,422
Gross profit	35,048,311		$ 41,834,961	22,593,105		35,048,311	$ 4,487,103	41,834,961	22,593,105
Gross profit margin %		20.10%	12.00%		9.40%
Private-labelled apparel products [Member]
Schedule of Breakdown of Gross Profit and Gross Profit Margin [Line Items]
Revenue	156,316,352		$ 336,306,554	237,282,262		156,316,352		336,306,554	237,282,262
Cost of revenue	134,239,759		301,429,220	216,523,165
Gross profit	22,076,593		$ 34,877,334	20,759,097
Gross profit margin %		14.10%	10.40%		8.70%
Own-branded apparel products [Member]
Schedule of Breakdown of Gross Profit and Gross Profit Margin [Line Items]
Revenue	17,886,275		$ 11,145,014	3,254,265		$ 17,886,275		$ 11,145,014	$ 3,254,265
Cost of revenue	4,914,557		4,187,387	1,420,257
Gross profit	$ 12,971,718		$ 6,957,627	$ 1,834,008
Gross profit margin %		72.50%	62.40%		56.40%

Dissagreggated Revenue (Details) - Schedule of Revenue is Disaggregated by the Geographical Locations	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Geographical locations:
Revenue by geographical locations	$ 174,202,627	$ 22,302,504	$ 347,451,568	$ 240,536,527
Geographical locations [Member]
Geographical locations:
Revenue by geographical locations	174,202,627		347,451,568	240,536,527
The United States and Canada [Member]
Geographical locations:
Revenue by geographical locations		16,915,437
The United States and Canada [Member] | Geographical locations [Member]
Geographical locations:
Revenue by geographical locations	132,124,783		328,293,299	235,568,451
The UK [Member]
Geographical locations:
Revenue by geographical locations		2,291,423
The UK [Member] | Geographical locations [Member]
Geographical locations:
Revenue by geographical locations	17,898,073		11,145,014	3,080,163
Others [Member]
Geographical locations:
Revenue by geographical locations		$ 3,095,644
Others [Member] | Geographical locations [Member]
Geographical locations:
Revenue by geographical locations	$ 24,179,771		$ 8,013,255	$ 1,887,913

Other Income (Details) - Schedule of Other Income	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Schedule of Other Income Consists [Abstract]
Exchange gain, net				$ 2,313,438
Agency income	2,662,034	340,810	2,586,019	2,904,339
Others	326	42
Total	$ 2,662,360	$ 340,852	$ 2,586,019	$ 5,217,777

Taxes (Details) - HKD ($)		12 Months Ended
	Apr. 01, 2023	Dec. 31, 2023	Dec. 31, 2020	Dec. 31, 2019
Hong Kong [Member]
Taxes [Line Items]
Applicable tax rate		16.50%
Profits tax rates			16.50%	8.25%
Assessable profits (in Dollars)			$ 2,000,000	$ 2,000,000
UK [Member]
Taxes [Line Items]
Applicable tax rate	25.00%

Taxes (Details) - Schedule of Provision for Income Taxes	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Deferred:
Total provision for income taxes	$ 1,325,137	$ 169,652	$ 2,979,918	$ 1,742,282
Hong Kong [Member]
Current:
Provision for income taxes - Current	928,973	118,941	$ 2,979,918	$ 1,742,282
Deferred:
Provision for income taxes - Deferred	7,876	1,008
The UK [Member]
Current:
Provision for income taxes - Current	$ 388,288	$ 49,703

Taxes (Details) - Schedule of Reconciles Cayman Islands Statutory Rates	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Schedule of Reconciles Cayman Islands Statutory Rates [Abstract]
Income tax rate in the Cayman Islands, permanent tax holiday	0.00%	0.00%	0.00%
Hong Kong statutory income tax rate	16.50%	16.50%	16.50%
Effect of different tax rates	2.10%	(0.60%)	(0.80%)
Income not taxable			(5.30%)
Expense not deductible	7.00%	4.30%
Temporary not recognized	0.40%	0.30%	14.10%
Tax concession	(2.90%)	(1.10%)	(0.30%)
Effective tax rate	23.10%	19.40%	24.20%

Taxes (Details) - Schedule of Significant Components of Deferred Tax	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Schedule Of Significant Components Of Deferred Tax Abstract
Deferred tax assets	$ 7,876	$ 1,008	$ 7,876
Transferred to consolidated statements of income	(7,876)	(1,008)
Valuation allowance
Net deferred tax assets			$ 7,876

Risks and Uncertainties (Details)	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2023 USD ($)
Hong Kong [Member]
Risks and Uncertainties [Line Items]
Cash was on deposit at financial institutions	$ 500,000			$ 64,090
Cash balance	913,267			116,922
UK [Member]
Risks and Uncertainties [Line Items]
Cash was on deposit at financial institutions	$ 936,039			$ 631,942
Customer One [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	71.30%	91.40%	94.50%
Customer One [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	44.70%	83.20%
Customer Two [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	21.60%
Customer Three [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	11.00%
Customer Four [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	10.10%
No Other Customer [Member] | Purchases [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage		10.00%
No Other Customer [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage		10.00%
One Vendor [Member] | Purchases [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	69.30%	44.20%	86.50%
One Vendor [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	44.80%
Two Vendor [Member] | Purchases [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	24.60%	35.90%	13.50%
Two Vendor [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	41.60%
No Other Vendor [Member] | Purchases [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	10.00%
No Other Vendor [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	10.00%
Three Vendor [Member] | Accounts Payable [Member] | Supplier Concentration Risk [Member]
Risks and Uncertainties [Line Items]
Concentration risk, percentage	13.60%
Hong Kong Deposit Protection Board [Member] | Hong Kong [Member]
Risks and Uncertainties [Line Items]
Cash was on deposit at financial institutions	$ 4,936,039

Shareholders' Equity (Details)		Dec. 31, 2023 $ / shares shares	Dec. 31, 2022 $ / shares shares
Shareholders' Equity [Line Items]
Ordinary shares issued	[1]	18,000,000	18,000,000
Ordinary shares outstanding	[1]	18,000,000	18,000,000
Permanent equity		1
Ordinary shares shares authorized	[1]	800,000,000	800,000,000
Ordinary shares par value (in Dollars per share) | (per share)	[1]	$ 0.0000625
IPO [Member]
Shareholders' Equity [Line Items]
Ordinary shares issued		11,250,000
Ordinary shares outstanding		11,250,000
[1] Giving retroactive effect to all the 11,250,000 shares issued and outstanding for a share split at a ratio of 1-to-1.6 on July 14, 2023

Subsequent Events (Details) - Forecast [Member]	1 Months Ended
	Apr. 23, 2024 $ / shares shares
Subsequent Events (Details) [Line Items]
Closing ordinary shares (in Shares) | shares	2,320,000
Ordinary shares par value	$ 0.0000625
Offering price per share	$ 4

Parent Only Financial Information (Details) - shares	Oct. 29, 2021	Dec. 31, 2023
Splendid Vibe Limited [Member]
Schedule I - Parent Only Financial Information [Line Items]
Percentage of subsidiary	100.00%
Ms. Eva Yuk Yin Siu [Member]
Schedule I - Parent Only Financial Information [Line Items]
Percentage of equity interest		94.00%
Ms. Man Chi Wai [Member]
Schedule I - Parent Only Financial Information [Line Items]
Percentage of equity interest		6.00%
NCA [Member]
Schedule I - Parent Only Financial Information [Line Items]
Transfer share (in Shares)	100
BVI [Member]
Schedule I - Parent Only Financial Information [Line Items]
Transfer share (in Shares)	100
Ms. Eva Yuk Yin Siu [Member]
Schedule I - Parent Only Financial Information [Line Items]
Percentage of incorporated	94.00%
Ms. Man Chi Wai [Member]
Schedule I - Parent Only Financial Information [Line Items]
Percentage of incorporated	6.00%

Parent Only Financial Information (Details) - Schedule of Condensed Balance Sheets - Parent Company [Member]	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)
Current assets
Amount due from the shareholder	$ 8,775	$ 1,125	$ 8,775
Non-current assets
Interests in a subsidiary	780	100	780
Total assets	9,555	1,225	9,555
Current liabilities
Amounts due to a subsidiary	149,867	19,187	780
Amounts due to a related party			71,999
Total liabilities	149,867	19,187	72,779
Shareholders’ deficit
Ordinary shares: US$0.0000625 par value, 800,000,000 shares authorized as of December 31, 2022 and 2023; 18,000,000 shares issued and outstanding as of December 31, 2022 and 2023	8,775	1,125	8,775
Accumulated losses	(149,087)	(19,087)	(71,999)
Total shareholders’ deficit	(140,312)	(17,962)	(63,224)
Total liabilities and shareholders’ deficit	$ 9,555	$ 1,225	$ 9,555

Parent Only Financial Information (Details) - Schedule of Condensed Balance Sheets (Parentheticals) - Parent Company [Member]	Dec. 31, 2023 $ / shares shares	Dec. 31, 2023 $ / shares shares	Dec. 31, 2022 $ / shares shares
Condensed Balance Sheet Statements, Captions [Line Items]
Ordinary shares: par value (in Dollars per share and Dollars per share) | (per share)	$ 0.0000625	$ 0.0000625	$ 0.0000625
Ordinary shares: shares authorized	800,000,000	800,000,000	800,000,000
Ordinary shares: shares issued	18,000,000	18,000,000	18,000,000
Ordinary shares: shares outstanding	18,000,000	18,000,000	18,000,000

Parent Only Financial Information (Details) - Schedule of Condensed Statements of Loss and Comprehensive Loss - Parent Company [Member]	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Operating expenses
General and administrative expenses	$ (77,088)	$ (9,869)	$ (42,000)	$ (29,999)
Total operating expenses	(77,088)	(9,869)	(42,000)	(29,999)
Loss before income taxes	(77,088)	(9,869)	(42,000)	(29,999)
Income taxes
Net loss	$ (77,088)	$ (9,869)	$ (42,000)	$ (29,999)

Parent Only Financial Information (Details) - Schedule of Condensed Statements of Cash Flows - Parent Company [Member]	12 Months Ended
	Dec. 31, 2023 HKD ($)	Dec. 31, 2023 USD ($)	Dec. 31, 2022 HKD ($)	Dec. 31, 2021 HKD ($)
Cash flows from operating activities
Net loss	$ (77,088)	$ (9,869)	$ (42,000)	$ (29,999)
Changes in operating assets and liabilities
Net cash used in operating activities	(77,088)	(9,869)	(42,000)	(29,999)
Cash from (used in) investing activities
Amount due to a related party	77,088	9,869	42,000	29,999
Cash flows from financing activities	77,088	9,869	42,000	29,999
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year

---