good news pints:CONCEPT SPORTS LIMITED (CCS)ASX RELEASE3 October...

good news pints:
CONCEPT SPORTS LIMITED (CCS)
ASX RELEASE
3 October 2006
The Company Announcements Office
Australian Stock Exchange Limited
20 Bridge Street
SYDNEY NSW 2000
Prospectus Litigation Settlement
The board of Concept Sports Limited (“Company”) is pleased to announce the settlement of
litigation brought by a number of plaintiffs against the Company and certain of its directors,
subject to the condition and generally upon the terms set out below. The board believes that the
outcome vindicates the Company’s vigorous denial of the plaintiffs’ claims against the Company.
In December 2004 a class action was brought against the Company and its then directors by a
number of persons who subscribed for shares under the Company’s prospectus issued in May
2004. The proceedings were also brought against Pitcher Partners, the investigating accountants
named in the prospectus. The plaintiffs alleged that the prospectus did not contain information
required by section 710 of the Corporations Act and that the forecasts of sales revenue and
statements about the Company’s outlook were misleading and deceptive in breach of section
1041H of the Corporations Act. The plaintiffs claims totalled more than $5 million.
In turn the Company filed defences denying the plaintiffs’ claims and brought proceedings against
the Company’s legal advisors in relation to the prospectus, Baker & McKenzie and Munro Legal.
The detailed terms of the settlement are confidential to the parties to the litigation but, insofar as
they apply to Concepts Sports Limited, the more major provisions can be summarised in general
terms as follows:
1. The settlement provides for the making of payments by certain parties to the proceedings
(“Contributors”) to the plaintiffs on 18 December 2006 in full and final settlement of the
plaintiffs’ claims, including legal costs. The settlement is made solely to avoid the
significant ongoing costs of the proceedings and with no admission of liability.
2. The amount to be paid by the Company under the settlement terms is $500,000. As
previously announced on the 4 September 2006, the directors are indemnifying the
company for the full amount.
3. The settlement is conditional upon the payments due by Contributors being made. If any
Contributor does not meet its payment obligations to the plaintiffs then the settlement
arrangements are terminated and the legal proceedings are continued. In that case any
moneys paid under the settlement arrangements by a particular Contributor must be
repaid by the plaintiffs to that Contributor.
However, if any Contributor does not meet its payment obligations on 18 December 2006
the plaintiffs may instead elect to proceed with the settlement and pursue any defaulting
Contributor for their respective payments.
4. Upon the settlement becoming unconditional (either because all payments have been
made or because not all payments have been made but the plaintiffs have made the
election referred to in paragraph 3 above) the various claims in the proceedings,
including cross claims, other than the cross claims brought by the Company and its
executive directors against CGU Insurance Limited, are to be struck out and each party
releases each other party from any further claims.
5. The Company and the executive directors of the Company who are party to these legal
proceedings remain entitled to continue their claims for indemnity against CGU Insurance
Ltd under a directors’ and officers’ insurance policy issued in favour of the Company and
its directors.
Concepts Sports Limited will make a further announcement to the Australian Stock Exchange on
the outcome of the settlement arrangements on 18 December 2006.
For further information please contact Gary March on (03) 9646 6611.