Securities code: 002586 securities abbreviation: * ST sea reclamation Announcement No.: 2022-037 Zhejiang Reclaim Construction Group Co.Ltd(002586)
Announcement on receiving the decision on administrative punishment and market prohibition
The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete without false records, misleading statements or major omissions.
Zhejiang Reclaim Construction Group Co.Ltd(002586) (hereinafter referred to as “the company”) received the notice of investigation (yzzz No. 2019051) from China Securities Regulatory Commission (hereinafter referred to as “CSRC”) on July 12, 2019. Because the company is suspected of illegal information disclosure, the CSRC decided to file a case for investigation according to the relevant provisions of the securities law of the people’s Republic of China.
On December 17, 2021, the company and relevant parties received the notice in advance of administrative punishment (yzjg Zi [2021] No. 4) and the notice in advance of market Prohibition (yzjg Zi [2021] No. 5) issued by Ningbo regulatory bureau of China Securities Regulatory Commission.
On February 10, 2022, the company and relevant parties received the decision on administrative punishment ([2022] No. 1) and the decision on market Prohibition ([2022] No. 1) issued by Ningbo regulatory bureau of China Securities Regulatory Commission. The relevant contents are hereby announced as follows:
1、 Main contents of the decision on administrative punishment:
“Party: Zhejiang Reclaim Construction Group Co.Ltd(002586) (hereinafter referred to as * ST Waihai), domicile: Yinzhou District, Ningbo City, Zhejiang Province.
Feng Quanhong, male, born in November 1952, was the legal representative and chairman of * ST Weihai, the actual controller of Zhejiang Reclaim Construction Group Co.Ltd(002586) , and his address is Yinzhou District, Ningbo City, Zhejiang Province.
Yang Xianshui, male, born in April 1965, was the general manager of * ST Weihai, and his address is Yinzhou District, Ningbo City, Zhejiang Province.
Ge Mingliang, male, born in February 1979, was the executive deputy general manager of * ST Waihai, and his address is Zhenhai District, Ningbo City, Zhejiang Province.
Hu Shousheng, male, born in January 1972, was the financial director of * ST Weihai, and his address is Zhenhai District, Ningbo City, Zhejiang Province.
Chen Wei, male, born in January 1986, was the Secretary of the board of directors and assistant to the general manager of * ST Waihai. His address is Yinzhou District, Ningbo City, Zhejiang Province.
Wang Weijun, male, born in July 1980, was the assistant to the general manager of * ST Weihai. His address is Yinzhou District, Ningbo City, Zhejiang Province.
Gong Xiaohu, male, born in August 1986, was the chairman of * ST Waihai supervisory board, and his address is Yinzhou District, Ningbo City, Zhejiang Province.
Wu Liangyong, male, born in April 1969, was the chief engineer of * ST Weihai, and his address is Yinzhou District, Ningbo City, Zhejiang Province.
Yu Jianhong, male, born in October 1975, was the assistant to the general manager of * ST Weihai, and his address is Yinzhou District, Ningbo City, Zhejiang Province.
According to the relevant provisions of the securities law of the people’s Republic of China revised in 2005 (hereinafter referred to as the securities law of 2005), our bureau has filed a case for investigation and trial of * ST sea reclamation and other violations of securities laws and regulations, and informed the parties of the facts, reasons and basis of administrative punishment and the rights enjoyed by the parties according to law. The parties Yang Xianshui, Ge Mingliang, Hu Shousheng, Chen Wei, Wang Weijun, Gong Xiaohu and Yu Jianhong submitted written statements and defense opinions. At the request of the parties Yang Xianshui, Ge Mingliang, Hu Shousheng, Chen Wei, Wang Weijun and Gong Xiaohu, our bureau held a hearing and listened to the statements and arguments of the parties and their agents. The investigation and trial of this case have been concluded.
It is found that the parties have the following illegal facts:
1、 Failure to disclose the guarantee provided for related parties as required
From July 2018 to July 2019, * ST Waihai provided guarantees for the related party Zhejiang WAIHAI Holding Group Co., Ltd. (hereinafter referred to as Waihai holding) and its controlled companies at the instigation and arrangement of Feng Quanhong, involving a total amount of 1.354 billion yuan, but * ST Waihai did not disclose it as required. Specifically:
1. In July 2018, Weihai holdings signed the loan contract of RMB 100 million from Gu Wenju, and * ST Weihai issued the letter of unlimited joint and several liability to guarantee the debt of relevant loans. On September 20, 2019, * ST Waihai announced the guarantee for the first time.
2. In September 2018, Zhejiang Reclaim Construction Group Co.Ltd(002586) signed two pledge contracts with China Everbright Bank Company Limited Co.Ltd(601818) Shanghai East sub branch of China, taking * ST Weihai’s RMB bank deposit certificate in the bank as the guarantee liability for debt repayment of Weihai holding’s RMB 142.5 million loan in the bank. On April 27, 2019, * ST Waihai announced the guarantee for the first time.
3. From September to November 2018, Weihai holdings signed the repayment agreement of RMB 34502917 owed to Wang Chongliang, and * ST Weihai stamped the official seal on the repayment agreement to assume the liability of debt guarantee. On August 23, 2019, * ST Waihai announced the guarantee for the first time.
4. From November 2018 to March 2019, * ST Weihai signed seven pledge contracts with Baoji Huitong sub branch of Chang’an bank, taking * ST Weihai’s RMB bank deposit certificate in the bank as Weihai holding subsidiary Zhejiang Weihai Trade Co., Ltd Ningbo lanzo Trading Co., Ltd. (hereinafter referred to as lanzo trading) controlled by Weihai holding undertakes the pledge guarantee liability for the bank’s 460 million yuan bank acceptance bill. On April 27, 2019, * ST Waihai announced the guarantee for the first time.
5. On July 3, 2019, the “2019 Huitong Chengzi No. 002 bank acceptance agreement” signed by lanzo trade and Baoji Huitong sub branch of Chang’an Bank expired, and lanzo trade needs to return the capital of RMB 100 million to Baoji Huitong sub branch of Chang’an bank. Due to the shortage of funds, lanzo trade borrowed 100 million yuan from Hangzhou Changping Industry Co., Ltd. (hereinafter referred to as Changping industry) to repay the deduction of bank acceptance bill of Baoji Huitong sub branch of Chang’an bank. The pledge contract related to the bank acceptance agreement was fulfilled, and the pledge of the relevant pledge * ST Waihai certificate of deposit was released. On the same day, * ST Weihai pledged the certificate of deposit again to guarantee the “2019 Huitong Yincheng Zi No. 168 bank acceptance agreement” signed by Changping industry and Baoji Huitong branch of Chang’an bank, with a guarantee amount of 100 million yuan. Baoji Huitong sub branch of Chang’an bank issued a bank acceptance bill of 100 million yuan according to the bank acceptance agreement. Changping industry borrowed 100 million yuan of funds from lanzo trade, and recovered the funds through the bank acceptance bill of 100 million yuan obtained through the re pledge of * ST sea reclamation certificate of deposit, which is only used for channel function. Lanzo trade pledged Zhejiang Reclaim Construction Group Co.Ltd(002586) certificate of deposit through Changping industry, and the final user of funds is still lanzo trade.
On March 24, 2021, Zhejiang Reclaim Construction Group Co.Ltd(002586) announced the guarantee for the first time.
6. In February 2019, WAIHAI holdings, Ningbo kehuai Trade Co., Ltd. (hereinafter referred to as kehuai trade) and Zhonghong chuangrong commercial factoring (Shenzhen) Co., Ltd. (hereinafter referred to as Zhonghong factoring) signed the comprehensive service agreement and China commercial factoring contract, etc., and Zhonghong factoring provided the maximum financing amount of 370 million yuan to kehuai trade* St Waihai issued the unconditional repurchase commitment letter and assumed the unconditional repurchase commitment responsibility for the Chinese commercial factoring contract. On September 27, 2019, * ST Waihai announced the guarantee for the first time.
7. In March 2019, * ST sea reclamation subsidiary Zhejiang Sea Reclamation Construction Group Engineering Development Co., Ltd. (hereinafter referred to as the sea reclamation project) signed three pledge contracts with Baoji Huitong sub branch of Chang’an bank, taking the RMB bank deposit certificate of the sea reclamation project in the bank as the pledge guarantee liability for the 140 million yuan bank acceptance bill of langzo trade in the bank. On April 27, 2019, * ST Waihai announced the guarantee for the first time.
8. In April 2019, Weihai holdings signed the loan agreement of RMB 7 million from Shao Zhiyun, and * ST Weihai stamped the official seal on the loan guarantor column of the loan agreement. On August 23, 2019, * ST Waihai announced the guarantee for the first time.
2、 Failure to disclose the related party transactions of non operating funds occupied by related parties as required
From October 2017 to March 2019, * ST Weihai provided a total of 346.35 million yuan to related parties such as longzo trading, Zhejiang JunGuan new materials Co., Ltd. (hereinafter referred to as JunGuan new materials) controlled by Weihai holding and its controlled by means of indirect transfer of contract advance payment to suppliers and direct transfer of loan under the guidance of Feng Quanhong, Related party transactions involving the occupation of non operating funds by related parties, but * ST sea reclamation was not disclosed as required. Specifically:
1. In October 2017, * ST Weihai signed a procurement contract with two suppliers (Ningbo Huijin Labor Development Co., Ltd. and Ningbo Hechang Municipal Garden Construction Co., Ltd.), paid the contract advance payment to the other party, and then the other party borrowed money from Weihai holdings, involving a total of 60 million yuan. In December 2018, Weihai Holdings has returned the occupied funds. On April 27, 2019, * ST sea reclamation announced the occupation of the fund for the first time. 2. From January to March 2018, * ST Weihai signed a procurement contract with lanzo trade, paid the contract advance payment to lanzo trade, and then lanzo trade borrowed from Weihai holdings, involving a total of 60 million yuan. Of the above funds, 15 million yuan was returned in April 2018 and 45 million yuan was returned in December 2018. On April 27, 2019, * ST sea reclamation announced the occupation of the fund for the first time.
3. In June 2018, * ST Weihai subsidiary Zhejiang Weihai Construction Group Zhoushan Co., Ltd. provided a loan of 5 million yuan to lanzo trade. Of the above funds, 1 million yuan was returned in June 2018 and the remaining 4 million yuan was returned in October 2018. On April 27, 2019, * ST sea reclamation announced the occupation of the fund for the first time. 4. In September 2018, * ST Weihai subsidiary Beijing orange music new entertainment culture media Co., Ltd. (hereinafter referred to as orange music new entertainment) provided a loan of 500000 yuan to lanzo trade. The above funds were returned in December 2018. On April 27, 2019, * ST sea reclamation announced the occupation of the fund for the first time.
5. From June 2018 to March 2019, lanzo trade and JunGuan new materials occupied a total of 220.85 million yuan of * ST sea reclamation funds through intermediaries such as employees of * ST sea reclamation project department or labor companies. On September 24, 2020, * ST sea reclamation announced the occupation of the fund for the first time. As of November 30, 2021, lanzo trade and JunGuan new materials have returned 37 million yuan of funds occupied, and the balance of funds occupied is 183.85 million yuan.
To sum up, * ST sea reclamation failed to disclose the guarantee provided for related parties as required, involving a total guarantee amount of 1.354 billion yuan; The related party transactions that did not disclose the non operating funds occupied by related parties as required, with a total amount of 346.35 million yuan. As of November 30, 2021, the balance of * ST sea reclamation fund occupied by sea reclamation holding and its controlled companies was 851277900 yuan, of which 183850000 yuan was occupied by the employees of * ST sea reclamation project department or labor service companies and other intermediaries, and 667427900 yuan was transferred to fund occupation due to the above guarantee matters.
The above illegal facts are proved by evidence such as loan contract, loan contract, pledge contract, bank transfer receipt, relevant announcement documents and inquiry records.
*The above-mentioned act of St encircling the sea violates the provisions of articles 63, 65, 66 and 67 of the securities law of 2005, and constitutes an illegal act mentioned in paragraph 1 of Article 193 of the securities law of 2005. For the illegal acts related to * ST sea reclamation guarantee, the person in charge directly responsible is Feng Quanhong, and the other persons directly responsible are Yang Xianshui, Hu Shousheng, Ge Mingliang, Chen Wei, Wang Weijun and Gong Xiaohu. Feng Quanhong is directly responsible for the illegal acts related to connected transactions occupied by Zhejiang Reclaim Construction Group Co.Ltd(002586) non operating funds, and Yang Xianshui, Ge Mingliang, Hu Shousheng, Chen Wei, Wang Weijun, Wu Liangyong and Yu Jianhong are directly responsible. As the actual controller of * ST Waihai, Feng Quanhong’s behavior has constituted the behavior of “the controlling shareholder and actual controller of the issuer, listed company or other information disclosure obligors instigating to engage in the illegal acts in the first two paragraphs” mentioned in paragraph 3 of Article 193 of the securities law of 2005.
During the defense materials and hearing, the party Yang Xianshui proposed that Yang Xianshui strictly implement the relevant provisions on the management of * ST sea seal, and will not seal anything that violates the rules, and all seals shall be subject to his signature. Feng Quanhong once said that he used * ST Weihai financial products to provide guarantee for Weihai holding’s loan and also provided a scheme. Yang Xianshui said it was not feasible, but later Weihai holding adopted other methods without his knowledge. As the general manager of * ST sea reclamation, Yang Xianshui has established three business divisions (equivalent to subsidiaries) according to the adjusted organizational structure and management system of * ST sea reclamation. The financial signature and related matters are not one pen of the general manager, but three pens. Request our bureau to consider the equivalence of responsibility and power and give them a lighter punishment.
In the defense materials and hearing process, the party Ge Mingliang and his agent proposed that GE Mingliang had never known, made decisions, participated in the illegal guarantee and fund occupation, nor obtained any benefits from it, and had been diligent and conscientious. Even if our bureau believes that GE Mingliang is not diligent and responsible, it is different from Feng Quanhong and others, and does not have the bad circumstances of making decisions and organizing the implementation of violations. Ge Mingliang actively cooperated with the investigation, never set any obstacles, and tried his best to eliminate or reduce the harmful consequences of the illegal act afterwards, which met the conditions for legal relief of responsibility. Since * ST sea reclamation
