Securities code: Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) securities abbreviation: Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) Announcement No.: pro 2022060 Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078)
Announcement on litigation
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 contents and risk tips:
● on May 6, 2021, Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) (hereinafter referred to as “Chengxing shares”, “the company” or “listed company”) was affected by the fact that 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 failure to solve the problem of the occupation of funds by the controlling shareholder and its related parties, The company’s shares are 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.
● 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 Jiangyin Chengxing Industrial Group Co., Ltd. (hereinafter referred to as “Chengxing group”) and its related parties in 2021 based on the creditor’s statement, which led to the confirmation of net assets. The company received the inquiry letter from the Shanghai Stock exchange on January 28, 2022 and February 7, 2022, requesting that the creditor’s statement be followed The company is making a positive reply and will timely perform the information disclosure in accordance with relevant regulations.
● on November 9, 2021, Jiangyin construction decoration products factory, the creditor of the company, filed an application for bankruptcy reorganization of the company with Wuxi intermediate people’s Court (hereinafter referred to as “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. 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. 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 company will be subject to bankruptcy liquidation. According to article 9.4.13 of the Listing Rules of Shanghai Stock Exchange (revised in January 2022), the company’s shares will face the risk of delisting.
● on December 7, 2021, the company and Chengxing group received the filing notice from the China Securities Regulatory Commission (hereinafter referred to as 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.
● 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.
● Jiangyin Economic Development Park Co., Ltd. (hereinafter referred to as “Jiangyin Economic Development Park”) applied to the headquarters of Jiangyin Economic Development Park Co., Ltd. on February 2022. 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. There is still uncertainty about the success of Chengxing group’s subsequent reorganization.
● the litigation stage of the case: the judgment of the first instance has been issued
● party status of listed company: the third party
● amount involved in the case: 223876430938 yuan
● whether it will have a negative impact on the profits and losses of listed companies: at present, the first instance judgment of the case has been issued, and it is temporarily impossible to judge the amount of impact on the profits of the company in the current period or later. The final accounting treatment will be subject to the results confirmed by the annual audit of the audit institution.
On March 15, 2022, the company received the civil judgment of Jiangsu Jiangyin people’s Court (hereinafter referred to as “Jiangyin court” or “the court”) (2022) su0281 minchu No. 1630.
1、 Basic information of this lawsuit
(I) litigation
Plaintiff: Jiangsu Asset Management Co., Ltd. (hereinafter referred to as “Jiangsu asset”)
Defendant: Chengxing group
Third party: Chengxing Co., Ltd
Time of receiving civil judgment: March 15, 2022
Name and location of litigation institution: Jiangyin court
Claim: it is requested to confirm that Chengxing shares will no longer enjoy the receivable creditor’s right of 223876430938 yuan (hereinafter referred to as “receivable creditor’s right I”) formed by the funds occupied by Chengxing group since December 31, 2021, and the receivable creditor’s right I has been transferred to Jiangsu assets on December 31, 2021.
Chengxing Co., Ltd., the third party, filed an independent lawsuit to the court: requesting to confirm that Chengxing Co., Ltd. has a receivable creditor’s right of 223876430938 yuan against Jiangsu assets since December 31, 2021 (hereinafter referred to as “receivable creditor’s right II”).
Judgment of first instance: in accordance with articles 471, 472, 479, 480, 483, 484, paragraph 1 of article 522, 523, paragraph 1 of article 545, 546 and paragraph 1 of article 557 of the civil code of the people’s Republic of China Paragraph 1 of article 568, paragraph 3 of Article 58 of the enterprise bankruptcy law of the people’s Republic of China, paragraph 1 of Article 9 of the provisions of the Supreme People’s Court on Several Issues concerning the application of the enterprise bankruptcy law of the people’s Republic of China (III), and Article 145 of the Civil Procedure Law of the people’s Republic of China, the judgment is as follows:
1、 It is confirmed that Jiangsu Asset Management Co., Ltd. has the creditor’s rights of 223876430938 yuan against Jiangyin Chengxing Industrial Group Co., Ltd. since December 31, 2021, and Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) no longer has the creditor’s rights of the receivable.
2、 It is confirmed that Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) will enjoy the receivable creditor’s rights of RMB 223876430938 against Jiangsu Asset Management Co., Ltd. from December 31, 2021.
The case acceptance fee of 11235622 yuan shall be borne by Chengxing group. Chengxing group shall pay to the court within ten days from the date of legal effect of this judgment (payee: special account for non tax income of Jiangyin Municipal Finance Bureau; Bank of deposit: Business Department of Jiangyin rural commercial bank; Account No.: 01660320100143708).
If you are not satisfied with this judgment, you can submit an appeal petition to this court within 15 days from the date of service of the judgment, and submit copies according to the number of opposite parties, and appeal to the intermediate people’s Court of Wuxi City, Jiangsu Province.
(II) background
The company received the creditor’s statement issued by Jiangsu Asset Management Co., Ltd. on December 31, 2021, The explanation is as follows: “our company is Jiangsu Asset Management Co., Ltd. and now holds Chengxing shares with a debt amount of more than 1745867622 yuan. Our company agrees to link all creditors of Chengxing shares with the receivables of 222334788240 yuan from Chengxing group and its related parties before April 30, 2022 (Unaudited, the final audit shall prevail) Fully realize or accept Chengxing shares and pay off the creditor’s rights held by our creditors with its receivables of 222334788240 yuan (Unaudited, subject to audit) to Chengxing group and its related parties instead of cash. No matter whether it can eventually link all creditors of Chengxing shares, our company unconditionally accepts the above arrangement and solves the problem of occupation of remaining funds in other ways “.
(III) impact of this lawsuit on the company
At present, the first instance judgment of the case has been issued, and it is temporarily impossible to judge the amount of impact on the company’s current or future profits. The final accounting treatment will be subject to the results confirmed by the annual audit of the audit institution.
2、 Other instructions
The company will timely perform the obligation of information disclosure on the above litigation matters in accordance with relevant regulations. Please pay attention to the investment risks.
It is hereby announced.
Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) board of directors
March 16, 2022
