TORONTO, June 5, 2013 /CNW/ - Boyuan Construction Group, Inc., TSX: BOY, BOY.DB.A), a growing construction company in China of commercial, residential and municipal infrastructure projects, announced today that the Ontario Securities Commission (the "OSC") issued an Order approving the Settlement Agreement reached by the Staff of the OSC ("Staff") with Boyuan. The settlement fully resolves all issues between Boyuan and the OSC in respect of the Staff allegations set out in the OSC Notice of Hearing and Statement of Allegations issued on May 31, 2013.
As approved by the OSC, the Settlement Agreement recognizes Boyuan's cooperation with Staff and efforts already taken by Boyuan to strengthen the company through the improvement of financial processes and controls. The Settlement Agreement also recognizes that the related party loan transaction in question was entered into further to a legitimate business interest, was fully repaid and no officer or director of Boyaun or parties related to them realized any personal benefit.
Pursuant to the terms of the OSC Order, Boyuan is required to engage an internal control consultant to review the internal control and financial reporting procedures and policies of Boyuan, to make recommendations for improvement and to report to Staff on its review and Boyuan's progress in implementing the consultant's recommendations. The consultant is required to report to Staff on its recommendations within three months of its engagement by Boyuan, and Boyuan is required to implement the consultant's recommendations within nine months, subject to certain time extensions that may be approved by Staff.
Under the OSC Order, Boyuan voluntarily paid a penalty of $200,000, and was required to make a $100,000 contribution towards the costs of the OSC investigation.
"Today's decision recognizes the extensive efforts made by Boyuan's senior management and Board of Directors to be forthcoming and transparent in addressing Staff's concerns on related party transactions and internal control issues," said Boyuan President and CEO, Mr. Cai Liang Shou. "Boyuan is committed to improving its internal control policies and procedures and will endeavour to reach a higher standard as a reporting issuer in Canada."
About Boyuan Construction Group, Inc.
Based in Jiaxing City, China, Boyuan Construction Group, Inc. is in the business of commercial building and residential construction, municipal infrastructure and engineering projects. In its last three fiscal years ending June 30, 2012, Boyuan completed more than 80 projects for a number of private and public sector clients. Boyuan's current project backlog includes residential, commercial, industrial and mixed-use developments. From its operating bases in Zhejiang Province and in Hainan Province, Boyuan focuses on construction projects in China's fast-growing regions of the Yangtze River Delta, Hainan Province and Shandong Province. For more information visit www.boyuangroup.com.
Caution Regarding Forward-Looking Information:
Certain information contained in this press release constitutes forward-looking information, which is information relating to future events or Boyuan's future performance and which is inherently uncertain. All information other than statements of historical fact may be forward-looking information. Forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "budget", "plan", "continue", "estimate", "expect", "forecast", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar words or phrases (including negative variations) suggesting future outcomes or statements regarding an outlook. Forward-looking information contained in this press release includes, but is not limited to, management's expectations on engaging an internal control consultant, implementation of the consultant's recommendations, timing of the consultant's report to Staff and timing of Boyuan's implementation of the recommendations, and management's expectation on improving its internal controls and reaching a higher standard as a reporting issuer. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. Boyuan believes the expectations reflected in the forward-looking information are reasonable but no assurance can be given that these expectations will prove to be correct and readers are cautioned not to place undue reliance on forward-looking information contained in this press release. Some of the risks and other factors which could cause results to differ materially from those expressed in the forward-looking information contained in this press release include, but are not limited to: risk of macro-economy cycle, risk from competition, risk from insufficient marketing to secure new projects, risk in obtaining additional financing, risk involving permits and licences, reliance on key management member, risk from supply of raw materials, risk of financial leverage, risk of bad debts in accounts receivables, risk involved in real estate development, foreign exchange fluctuations, political and economic conditions in China and other risks included in Boyuan's AIF for the fiscal year ended June 30, 2012 and in Boyuan's public disclosure documents filed with certain Canadian securities regulatory authorities and available at www.sedar.com. The forward-looking information contained in this press release are made as of the date hereof and Boyuan undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as otherwise required by law.
SOURCE: Boyuan Construction Group, Inc.
For further information:
Boyuan Construction Group, Inc.
Mr. Paul Law, CFO
+(852) 9329 5088
(416) 815 0700 ext. 253