Securities code: Shanghai Prosolar Resources Development Co.Ltd(600193) securities abbreviation: Shanghai Prosolar Resources Development Co.Ltd(600193) No.: 2022012 Shanghai Prosolar Resources Development Co.Ltd(600193)
Announcement on the realization of performance commitments of major asset restructuring
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 Shanghai Prosolar Resources Development Co.Ltd(600193) (hereinafter referred to as “the company”) completed the major asset restructuring of acquiring 60% equity of Shanghai Dongjiang Architectural Decoration Engineering Co., Ltd. (hereinafter referred to as “Dongjiang decoration”) by paying cash on July 15, 2019. The implementation of 2021 performance commitments of the underlying assets is described as follows:
1、 Basic information of major asset restructuring
In July 2019, according to the proposal deliberated and passed at the first extraordinary general meeting of shareholders in 2019, the company transferred 60% equity of Dongjiang decoration held by Shanghai Shangyuan Construction Technology Co., Ltd. (hereinafter referred to as “Shangyuan construction”) in cash, with a transaction price of 66 million yuan. According to the change (filing) Notice (21902604837) issued by Shanghai market supervision and Administration Bureau on July 15, 2019 and its business license issued on the same day, 60% of the equity of Dongjiang decoration has been transferred to the name of the company, and the company now holds 60% of the equity of Dongjiang decoration. As of December 31, 2021, according to the equity transfer agreement signed by both parties, the company has paid a total of 36 million yuan for phase I and phase II equity transfer.
The specific contents and progress of this transaction are detailed in the prompt announcement of Shanghai Prosolar Resources Development Co.Ltd(600193) on signing (Announcement No.: 2018046) issued by the company on September 18, 2018 and the progress announcement of Shanghai Prosolar Resources Development Co.Ltd(600193) on signing and equity acquisition (Announcement No.: Lin 2019009) issued on March 20, 2019, The announcement on the progress of Shanghai Prosolar Resources Development Co.Ltd(600193) major asset restructuring (Announcement No.: Lin 2019019, Lin 2019019) issued on May 11, 2019 and June 1, 2019, the company’s major asset purchase report (Draft) and its summary (Revised Version) issued on June 12, 2019, July 3, 2019 and July 13, 2019, and the resolution of the 15th meeting of Shanghai Prosolar Resources Development Co.Ltd(600193) the seventh board of directors
Announcement of the resolution of the first extraordinary general meeting of shareholders (Announcement No.: Lin 2019031), announcement of Shanghai Prosolar Resources Development Co.Ltd(600193) on the completion of the transfer of the subject assets of major asset restructuring (Announcement No.: Lin 2019032) and report on the implementation of Shanghai Prosolar Resources Development Co.Ltd(600193) major asset purchase issued on July 19, 2019.
2、 Performance commitment
According to the equity transfer agreement signed between the company and Shangyuan construction (i.e. “original shareholder of Dongjiang decoration” or “performance compensation obligor”), the performance commitments related to this major asset restructuring are as follows (the following “net profit” shall be subject to the lower before and after deducting non recurring profits and losses):
1. The committed amount of net profit in 2019 shall not be less than RMB 25 million;
2. The total net profit commitment in 2019 and 2020 shall not be less than 52 million yuan; 3. The total net profit commitment in 2019, 2020 and 2021 shall not be less than RMB 80.5 million.
The net profit from related party transaction business income that should be excluded from the annual net profit realization of Dongjiang decoration during the profit commitment period is calculated as follows:
Income from related party transactions in the year × (the average net profit margin of projects belonging to non related parties in this year is – 3%).
If the average net profit margin of projects belonging to non related parties in this year is ≤ 3%, it will not be excluded.
Related party transactions refer to transactions between Party A and its related parties (as defined in accounting standards for Business Enterprises No. 36 – disclosure of related parties) and “Dongjiang decoration”.
If the total accumulated net profit of Dongjiang decoration by the end of the current period is lower than the total accumulated committed net profit by the end of the current period, Shangyuan construction will compensate Shanghai Prosolar Resources Development Co.Ltd(600193) in cash. The specific compensation calculation formula is: the amount to be compensated in the current period = (Dongjiang decoration’s cumulative net profit commitment as of the end of the current year – Dongjiang decoration’s cumulative net profit realization as of the end of the current year) ÷ the total amount of net profit commitment during the profit commitment period (i.e. 80.5 million yuan) × Current transaction price (i.e. 66 million yuan) – accumulated compensated amount.
Shangyuan construction agrees to give priority to the compensation with the equity transfer price it obtained in this transaction. If there is a current compensation amount, Shanghai Prosolar Resources Development Co.Ltd(600193) has the right to directly deduct it from the equity transfer price that should be paid to Shangyuan construction in accordance with the equity transfer agreement in this year. If it is insufficient to deduct, Shanghai Prosolar Resources Development Co.Ltd(600193) does not need to pay the current equity transfer price to Shangyuan construction.
Within six months after the expiration of the performance commitment period, Shanghai Prosolar Resources Development Co.Ltd(600193) apply for an accounting firm with securities and futures business qualification to issue the impairment test audit report for Dongjiang decoration. In case of impairment, Shangyuan construction shall compensate Shanghai Prosolar Resources Development Co.Ltd(600193) for impairment. If the amount of impairment compensation is less than the performance compensation paid by Shangyuan construction to Shanghai Prosolar Resources Development Co.Ltd(600193) accumulatively, Shangyuan construction does not need to pay additional impairment compensation; If the amount of impairment compensation is greater than the amount of performance compensation paid by Shangyuan construction to Shanghai Prosolar Resources Development Co.Ltd(600193) accumulatively, Shangyuan construction will pay the difference between the amount of impairment compensation and the amount of cumulative performance compensation to Shanghai Prosolar Resources Development Co.Ltd(600193) accumulatively.
Yang Zhiping and Li Jinhui agree to assume joint and several guarantee liabilities for Shangyuan construction’s performance of the compensation obligations and liquidated damages obligations under the performance commitment compensation agreement.
3、 Completion of performance commitments
According to the special audit report on the completion of performance commitments of Shanghai Dongjiang Architectural Decoration Engineering Co., Ltd. in 2021 (zhongxinghua zhuanzi (2022) No. 410001) issued by zhongxinghua Certified Public Accountants (special general partnership), the completion of Dongjiang decoration performance in 2021 is as follows:
Unit: 10000 yuan
Accumulated amount of the project in 2019, 2020 and 2021
Net profit 308450 703.09 845.82463341
Committed net profit 25 Shenzhen Energy Group Co.Ltd(000027) China National Accord Medicines Corporation Ltd(000028) 5000805000
Completion rate: 123.38%, 26.04%, 29.68%, 57.56%
To sum up, in 2021, Dongjiang decoration performance commitment was not realized.
4、 Reasons for not fulfilling performance commitments
Since the outbreak of covid-19 epidemic in 2020, the construction industry has the characteristics of labor-intensive, many open-air operations, and the transfer of production sites with the location of construction projects. Compared with the traditional manufacturing industry, standardized management is more difficult, and the epidemic prevention and control conditions are more complex. Many governments have issued a series of documents on the delayed resumption of construction enterprises, resulting in the inability of normal personnel flow and materials transportation, resulting in the stagnation of the supply chain, It has brought great challenges to the capital flow of many real estate and construction enterprises. The increase of project de industrialization pressure of real estate enterprises will lead to the weakening of the commencement of new projects and the slow or stagnation of the progress of new and old projects.
The curtain wall and door and window business of Dongjiang decoration is based on the fact that the product specifications of the whole door and window and curtain wall industry are relatively fixed, the quality difference of finished products is small, the regionality is obvious, and the competition is fierce. The business development of Dongjiang decoration is also greatly affected by covid-19 epidemic. Many projects have problems such as construction delay and delivery extension. In addition, the price of building aluminum alloy materials continues to rise and the gross profit level decreases significantly, resulting in the decline of Dongjiang decoration performance.
At present, the business of Dongjiang decoration is still in the stage of cumulative growth through the project. Affected by all aspects, the future performance is also uncertain.
5、 Performance compensation arrangements and measures to be taken by the company
In view of the accumulated performance of Dongjiang decoration in 2019, 2020 and 2021 of 463341 million yuan and the commitment completion ratio of 57.56%, according to the relevant provisions of the equity transfer agreement, if the accumulated net profit realized by Dongjiang decoration at the end of the current year is lower than the accumulated net profit promised by the transferor at the end of the current year in any accounting year during the profit commitment period, Shangyuan construction must compensate Shanghai Prosolar Resources Development Co.Ltd(600193) for the difference, Shanghai Prosolar Resources Development Co.Ltd(600193) has the right to directly deduct the payment of relevant equity transfer price.
The management of the Company Apologizes for Dongjiang construction’s cumulative failure to fulfill its performance commitments by 2021, hereby solemnly apologizes to the majority of investors, and reminds investors to make prudent decisions and pay attention to investment risks. At the same time, the company will follow up the performance commitments in accordance with the equity transfer agreement, and fulfill the obligation of information disclosure according to the progress of relevant matters.
6、 Opinions of independent directors and board of supervisors
(I) opinions of independent directors
We believe that the contents of the special audit report on the completion of performance commitments of Shanghai Dongjiang Architectural Decoration Engineering Co., Ltd. in 2021 issued by zhongxinghua Certified Public Accountants (special general partnership) comply with the relevant regulations of China Securities Regulatory Commission and Shanghai Stock Exchange, and the financial data are true, accurate and complete without any false records, misleading statements or major omissions. The convening, convening, deliberation and voting procedures of the board of directors comply with the provisions of relevant laws, regulations and the articles of association, and there is no situation affecting the interests of shareholders, especially the interests of minority shareholders.
(II) opinions of the board of supervisors
After verification, we believe that the contents and data of the special audit report on the completion of performance commitments of Shanghai Dongjiang Architectural Decoration Engineering Co., Ltd. in 2021 issued by zhongxinghua Certified Public Accountants (special general partnership) are true, accurate and complete, and there are no false records, misleading statements or major omissions. 7、 Other instructions
In 2021, Dongjiang decoration failed to fulfill its performance commitment. The company deeply regrets this and sincerely apologizes to the majority of investors. In 2022, the company will formulate more reasonable development plans and business objectives, promote the implementation and implementation of various work, further optimize and integrate the company’s resources, control risks and enhance its core competitiveness. Up to now, the performance commitment party has not fulfilled its performance compensation obligations in 2020. The board of directors will actively communicate, complete the impairment test of the underlying assets as soon as possible, determine the final compensation scheme in 2021, urge the performance commitment party to fulfill its performance compensation obligations in 2020 and 2021 as soon as possible, and timely fulfill its information disclosure obligations in accordance with the requirements of relevant laws, regulations and normative documents. In the follow-up, corresponding measures will be taken according to the progress, including taking necessary legal means to safeguard the rights and interests of the company.
It is hereby announced.
Shanghai Prosolar Resources Development Co.Ltd(600193) board of directors March 31, 2022
