Stock Code: Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) stock abbreviation: ST Chengxing stock No.: pro 2022061 Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078)
About the court’s ruling to accept the company’s settlement
Announcement on the continued implementation of delisting risk warning for shares
The board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and completeness of its contents.
Important content tips:
● on March 15, 2022, Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) (hereinafter referred to as “Chengxing shares”, “company” or “listed company”) received the civil ruling and decision [(2021) su02 Boshen No. 11] from Wuxi intermediate people’s Court (hereinafter referred to as “Wuxi intermediate people’s court”), It ruled to accept the company’s settlement application and agreed that Jiangyin architectural decoration products factory withdrew its application for reorganization of the company, and appointed Jiangsu Mou Sheng law firm and Jiangsu juhexin law firm to jointly act as the company’s manager.
● on May 6, 2021, because the company’s internal control audit report with negative opinions was issued by Suya Jincheng Certified Public Accountants (special general partnership) (hereinafter referred to as “Suya Jincheng”) in 2020, and the company’s shares were subject to other risk warnings due to the failure to solve the occupation of funds by controlling shareholders and their related parties; Secondly, the audited ending net assets of the company in 2020 were negative, and the financial and accounting report of 2020 was issued, which could not express opinions, and the delisting risk warning of the company’s shares was implemented. In view of the fact that the company also triggered relevant provisions such as the Listing Rules of Shanghai Stock Exchange, the company’s shares have been warned of delisting risk. Due to the court’s ruling to accept the settlement, the company’s shares will continue to be subject to delisting risk warning in accordance with item (VII) of article 9.4.1 of the Listing Rules of Shanghai Stock Exchange (revised in January 2021) (hereinafter referred to as the “Listing Rules”).
● according to the listing rules, the company shall disclose the relevant information in time due to the delisting risk warning situation specified in Item (VII) of article 9.4.1 of the listing rules, and the trading shall be suspended from the next trading day. However, the delisting risk warning of the company’s shares has been implemented on May 6, 2021. Due to the court’s ruling to accept the settlement, the company’s shares will continue to implement the delisting risk warning according to item (VII) of article 9.4.1 of the listing rules. Therefore, the delisting risk warning of the company’s shares will continue to be implemented after the disclosure of this announcement without suspension, and the stock abbreviation is still ” Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) “, The stock code is still ” Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) “, and the daily limit of the company’s stock price is still 5%.
● the court has ruled that the company has entered into the settlement procedure, but the company is still at risk of being declared bankrupt due to the failure of the settlement. If the company is declared bankrupt, the company will be subject to bankruptcy liquidation. According to article 9.4.13 of the stock listing rules of Shanghai Stock Exchange (revised in January 2022), the company’s shares will face the risk of delisting.
● type of court ruling: settlement
On November 9, 2021, Jiangyin construction and decoration products factory, the creditor of the company, applied to Wuxi intermediate people’s court for bankruptcy reorganization on the grounds that the company could not pay off its due debts and its assets were insufficient to pay off all debts. On January 7, 2022, the company applied for settlement on the grounds that it could not pay off its due debts and its assets were insufficient to pay off all debts or it was obviously lack of solvency. Later, the company conducted commercial negotiations with major creditors and other stakeholders, and prepared a draft settlement agreement. On March 11, 2022, the company submitted the draft settlement agreement to the court. On the same day, Jiangyin construction and decoration products factory said that it had no objection to the company’s settlement application, and the court accepted the company’s settlement as its agreement to withdraw the company’s reorganization application. On March 15, 2022, the company received the civil ruling and decision of Wuxi intermediate people’s Court [(2021) Su 02 Po Shen No. 11], ruled to accept the company’s settlement application, agreed Jiangyin architectural decoration products factory to withdraw the company’s reorganization application, and appointed Jiangsu Mou Sheng law firm and Jiangsu juhexin law firm to jointly act as the company’s manager. In accordance with the relevant provisions of the listing rules, the matters related to the company’s settlement are hereby announced as follows:
1、 Summary of court ruling accepting settlement
(I) basic information of the parties and reasons for application
Applicant: Jiangyin building decoration products factory
Address: Group 8, Tongyun village, Chengjiang Town, Jiangyin City
Applicant: Chengxing Co., Ltd
Address: No. 618, Meiyuan street, Jiangyin City
Legal representative: Jiang Daqing
Subject matter of application: on November 9, 2021, the creditor of the company, Jiangyin construction and decoration products factory, filed an application for bankruptcy reorganization of the company with Wuxi intermediate people’s Court on the grounds that the company could not pay off its due debts and its assets were insufficient to pay off all debts. On January 7, 2022, the company applied for settlement on the grounds that it could not pay off its due debts and its assets were insufficient to pay off all debts or it was obviously lack of solvency. On March 11, 2022, Chengxing shares submitted a draft settlement agreement. On March 11, 2022, Jiangyin architectural decoration products factory said that it had no objection to the company’s settlement application, and the court accepted the company’s settlement as its agreement to withdraw the company’s reorganization application.
(II) time of court ruling
Ruling time: March 14, 2022
(III) main contents of civil ruling
On November 9, 2021, Jiangyin construction and decoration products factory, the creditor of the company, filed an application for bankruptcy reorganization of the company with Wuxi intermediate people’s Court on the grounds that the company could not pay off its due debts and its assets were insufficient to pay off all debts. On January 7, 2022, the company applied for settlement on the grounds that it could not pay off its due debts and its assets were insufficient to pay off all debts or it was obviously lack of solvency. On March 11, 2022, Chengxing shares submitted a draft settlement agreement. On March 11, 2022, Jiangyin architectural decoration products factory said that it had no objection to the company’s settlement application, and the court accepted the company’s settlement as its agreement to withdraw the company’s reorganization application.
2、 Situation of court appointed administrator
(I) main contents of the decision
On March 14, 2022, the company received the decision of Wuxi intermediate people’s Court (2021) su02 Boshen No. 11. In accordance with Article 13, paragraph 1 of Article 22 and paragraph 1 of Article 24 of the enterprise bankruptcy law of the people’s Republic of China, Article 20 of the provisions of the Supreme People’s Court on appointing an administrator in the trial of enterprise bankruptcy cases In accordance with Article 12 of the provisions on the hierarchical management and selection of bankruptcy administrators of Wuxi court, Jiangsu Mou Sheng law firm and Jiangsu juhexin law firm were appointed as the company’s managers.
According to the decision, the administrator shall be diligent and conscientious, faithfully perform his duties, perform various duties of the administrator as stipulated in the enterprise bankruptcy law of the people’s Republic of China, report his work to the people’s court, and accept the supervision of the creditor meeting and the creditor Committee. The responsibilities of the manager are as follows:
1. Take over the debtor’s property, seals, account books, documents and other materials;
2. Investigate the debtor’s property status and prepare a property status report;
3. Decide on the debtor’s internal management affairs;
4. Determine the daily expenses and other necessary expenses of the debtor;
5. Decide to continue or stop the debtor’s business before the first creditors’ meeting;
6. Manage and dispose of the debtor’s property;
7. Participate in litigation, arbitration or other legal proceedings on behalf of the debtor;
8. Propose to convene a creditors’ meeting;
9. Other duties that Wuxi intermediate people’s court believes the manager should perform.
(II) management mode: during the period of bankruptcy settlement, the company will adopt the mode of manager managing property and business affairs. (III) the contact information of the manager is as follows:
Contact: Jiang Xue, Wu Chenghan;
Tel.: 15651585263, 1586156611;
Contact address: No. 618, Meiyuan street, Jiangyin City, Jiangsu Province.
3、 Court announcement
On March 15, 2022, Wuxi intermediate people’s Court issued (2022) Su 02 Po No. 2 announcement, in which the specific contents on the declaration of creditor’s rights and the convening of the first creditor’s meeting are as follows:
Time limit and method of declaration of creditor’s rights: the creditors of the company shall declare their creditor’s rights to the manager (contact address: 618 Meiyuan street, Jiangyin City, Jiangsu Province, contact person: Wang Chongjing, mobile phone number: 182 Avic Aviation High-Technology Co.Ltd(600862) 35) before April 13, 2022. Those who fail to declare their creditor’s rights in accordance with the provisions of the enterprise bankruptcy law of the people’s Republic of China shall not exercise their rights during the execution of the settlement agreement, and may exercise their rights in accordance with the repayment conditions specified in the settlement agreement after the execution of the settlement agreement. The debtor or property holder of the company shall pay off the debts or deliver the property to the manager as soon as possible.
The first creditors’ meeting will be held at 9:30 a.m. on April 14, 2022.
Convening method of the first creditors’ meeting: the specific guidelines for attending the meeting will be notified by the manager separately.
4、 The impact of the court’s acceptance of the settlement on the company
(I) stock trading
Due to the negative internal control audit report issued by Su yajincheng in 2020 and the failure to solve the problem of the occupation of funds by the controlling shareholder and its related parties, the company’s shares were subject to other risk warnings; Secondly, the audited ending net assets of the company in 2020 were negative, and the financial and accounting report of 2020 was issued, which could not express opinions, and the delisting risk warning of the company’s shares was implemented. In view of the fact that the company triggered relevant provisions such as the Listing Rules of Shanghai Stock Exchange at the same time, the delisting risk warning of the company’s shares has been implemented on May 6, 2021, and the stock abbreviation has been changed from “Chengxing shares” to ” ST Chengxing”. Due to the court’s ruling to accept the settlement, according to item (VII) of article 9.4.1 of the listing rules, the company’s shares will continue to implement the delisting risk warning, the stock abbreviation is still ” ST Chengxing”, the stock code remains unchanged, and the daily rise and fall limit of the stock price is still 5%.
(II) arrangement of suspension and resumption of trading
According to the relevant provisions of the business guidelines for suspension and resumption of trading of listed companies planning major events in Shanghai Stock Exchange, the trading of shares of listed companies will not be suspended in principle during the settlement period. The company will disclose the progress of the settlement in stages. If it is really necessary to apply for suspension, the company will handle it in accordance with the regulations and fulfill the corresponding disclosure obligations.
(III) person in charge of information disclosure
After the company enters the settlement procedure, the information disclosure responsible person is the manager during the settlement period.
(IV) application for continued operation
The company plans to submit an application to the manager to continue business during the settlement period. During the settlement period, the company will actively cooperate with relevant parties to do a good job in employee stability, continue to maintain business affairs on the existing basis and other work related to the settlement. (V) other matters
According to the relevant provisions of the listing rules, the company shall disclose the progress of the settlement procedure once a month to remind the risk that its shares may be delisted until the corresponding circumstances are eliminated or its shares are delisted.
5、 Risk tips
1. If the company enters the settlement procedure, there will be a risk that it will be declared bankrupt due to the failure of settlement. If the company is declared bankrupt, the listing of the company’s shares will be terminated according to article 9.4.13 of the stock listing rules of Shanghai Stock Exchange (revised in January 2022).
2. On May 6, 2021, due to the negative internal control audit report issued by Su yajincheng in 2020 and the failure to resolve the occupation of funds by controlling shareholders and their related parties, the company’s shares were subject to other risk warnings; Secondly, the audited ending net assets of the company in 2020 were negative, and the financial and accounting report of 2020 was issued, which could not express opinions, and the delisting risk warning of the company’s shares was implemented. In view of the fact that the company also triggered relevant provisions such as the Listing Rules of Shanghai Stock Exchange, the company’s shares have been warned of delisting risk. According to article 9.3.11 of the Listing Rules of Shanghai Stock Exchange (revised in January 2022), if the company’s 2021 annual report touches any of the delisting related indicators, the listing of the company’s shares will be terminated.
3. The company disclosed the performance forecast on January 29, 2022, and the estimated net assets are 1310.4 million yuan to 194922 million yuan. However, the accountant of the company issued a special statement saying that according to the provisions of the accounting standards for business enterprises, The company reversed 72.50% of the bad debt reserves of the accounts receivable from Chengxing group and its related parties accrued in 2021 based on the creditor’s note, resulting in the confirmation of net assets, which is not based on sufficient basis. The company received the inquiry letter from the Shanghai Stock Exchange on January 28, 2022 and February 7, 2022, requesting an explanation on the matters leading to the confirmation of net assets in accordance with the creditor’s statement. The company is actively responding and will timely perform the information disclosure in accordance with relevant regulations.
4. On December 7, 2021, the company and Chengxing group received the notice of filing a case from the CSRC on the same day. Due to suspected illegal information disclosure, the CSRC decided to file a case against the company and Chengxing group in accordance with the securities law of the people’s Republic of China, the administrative punishment law of the people’s Republic of China and other laws and regulations. Up to now, the company and Chengxing group are actively cooperating with the CSRC in filing the case.
5. As of December 31, 2021, Chengxing group, the controlling shareholder of the company, and its related parties still occupied the company’s capital, with a total principal and interest of 223876430938 yuan (Unaudited), which has not yet been returned.
6. On February 8, 2022, the headquarters economic Park applied to Jiangyin court for reorganization of Chengxing group, the controlling shareholder of the company. On February 9, 2022, the company received a notification letter from Chengxing group, saying that the above reorganization application has been accepted by the court and Jiangsu mousheng law firm has been appointed as the manager of Chengxing group. Chengxing group entered the reorganization procedure, which may have an impact on the equity structure of the company. The company and Chengxing group remain independent in terms of business, personnel, assets, institutions and finance. Chengxing group’s entry into the reorganization process will not have an impact on the company’s daily production and operation. Can Chengxing group follow up
