Securities code: Jinzhou Cihang Group Co.Ltd(000587) securities abbreviation: ST Jinzhou Announcement No.: 2022025 Jinzhou Cihang Group Co.Ltd(000587)
Reply announcement on the letter of concern
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.
Risk tips:
As the net assets of the company are expected to be negative in 2021, the company’s annual financial statements in 2021 touch the provisions of article 9.3.1 of the stock listing rules (revised in 2022), and the company’s shares will be subject to delisting risk warning by Shenzhen Stock Exchange.
Jinzhou Cihang Group Co.Ltd(000587) (hereinafter referred to as the company) received the letter of concern on Jinzhou Cihang Group Co.Ltd(000587) issued by Shenzhen Stock Exchange on March 8 (company department concern letter [2022] No. 170), and now the reply is as follows:
1. According to the reply announcement of the letter of concern disclosed by your company, the exempted parties zhongrunboguan and Fenghui leasing have legally authorized and agreed with the authority before issuing the notice of debt exemption, have obtained effective and sufficient authorization, and have provided you with supporting documents such as the decision of the shareholders of Xiamen zhongrunboguan asset management Co., Ltd. and the decision of the shareholders of Fenghui Leasing Co., Ltd. Please specify:
(1) Whether Datong securities, Beijing Chengfang Huida, Huida assets, Zhong’an finance and Guoyuan Securities Company Limited(000728) the transferor of creditor’s rights have performed sufficient examination and approval procedures for the contract of creditor’s rights transfer. If so, it shall specify the specific examination and approval procedures performed, whether the contract of creditor’s rights transfer has come into force and whether there are still litigation risks in the follow-up. The lawyer hired by your company shall check and give clear opinions.
Company reply:
Datong securities and Zhongan finance transferred the creditor’s rights through the creditor’s rights transfer contract; Beijing Chengfang Huida and Huida assets (hereinafter collectively referred to as Huida company) and Guoyuan Securities Company Limited(000728) transferred the creditor’s rights to shoutuorongsheng and Fenghui leasing through judicial auction and judicial enforcement procedures.
1. Approval procedures to be performed
1) Datong securities
According to the reply document of Datong securities, its internal OA approval procedures are complete and the process has been completed: the legal affairs, internal control, review, contract review, leaders in charge and main principals promoted by the asset management risk disposal team have completed the signing, and the company has fulfilled the reasonable approval procedures for the creditor’s right transfer contract.
2) Zhongan Finance
According to “article 9.1.1 signing and performance qualification guarantee: Zhong’an financial guarantee has the subject qualification to sign this contract and has obtained the corresponding authorization or approval to sign and perform this contract” in the debt transfer contract, combined with its reply, its internal OA approval procedure is complete and the process has been implemented: it is signed by the legal affairs, internal control, finance, leaders in charge and main principals, Reasonable examination and approval procedures have been performed for the contract for assignment of creditor’s rights. 3) Guoyuan Securities Company Limited(000728) according to the civil ruling of Futian District People’s Court of Shenzhen, Guangdong Province (2019) Yue 0304 Caibao No. 2754, RMB 79 million was directly deducted from the respondent’s Fenghui leasing account. According to Article 700 of the civil code and Article 18 of the interpretation of the guarantee system of the civil code, Fenghui leasing, as the guarantor, assumed the guarantee responsibility and paid off the loan on behalf of Jinzhou Cihang, thus obtaining the right of recourse against Jinzhou Cihang. The creditor’s right has been transferred from Guoyuan Securities Company Limited(000728) to Fenghui leasing, Guoyuan Securities Company Limited(000728) there is no situation of signing the creditor’s right transfer contract, which has no material impact on the effectiveness of the debt exemption.
4) According to the bidding network platform provided by Shoutuo Rongsheng（ http://zc-paimai.taobao.com. ）Judging from the bidding confirmation, the transfer list of proof documents of the target creditor’s rights, the creditor’s rights transfer contract and the transfer voucher of the creditor’s rights of the listed auction company, shoutuorongsheng has fulfilled the bidding requirements in accordance with the requirements of the above documents and paid off all the money within the agreed period. The bidding results show that “the online auction has been completed” and has been confirmed to be legally effective by the judicial organ. Whether Huida company performs the approval procedures on the creditor’s right transfer contract does not have a material impact on the transfer of creditor’s rights to Shoutuo Rongsheng.
2. Whether the creditor’s right transfer contract has come into force and whether there is still litigation risk in the follow-up.
According to the internal approval procedures, execution progress and transfer vouchers performed by Datong securities and Zhong’an finance, the transferee has met the conditions of the creditor’s rights transfer agreement according to the relevant provisions in the creditor’s rights transfer contract, paid the consideration specified in the relevant provisions, and the creditor’s rights transfer involved has come into force legally.
Huida company and Guoyuan Securities Company Limited(000728) passed judicial procedures, and the transfer of creditor’s rights took effect legally.
As of the reply date, the third party has the right to exercise the cancellation right, except that the disclosed “the law requires that the relevant acts shall not maliciously damage the legitimate rights and interests of the third party.” (see the notice of reply to the letter of concern of Shenzhen Stock Exchange on February 24, 2022, No.: 2022015) and the “creditor’s rights transfer contract” signed by China Resources boguan and China security finance stipulates that “if China Resources boguan fails to deliver the shares as required and the overdue days reach more than 10 days, China security finance has the right to unilaterally terminate the contract.” (hereinafter collectively referred to as the exercise of cancellation right) and other circumstances, the company has not found any other factors with litigation risk.
Lawyer’s reply:
[as of the date of reply, it is still in the verification stage and has not made clear comments.]
(2) Whether your company has fulfilled relevant review procedures for debt exemption. If not, please explain whether it complies with relevant provisions such as the stock listing rules, and whether there is a risk that the debt exemption will not take effect, resulting in uncertainty in the income of debt restructuring. The annual audit accountant shall check and give clear opinions.
Company reply:
According to Article 575 of the civil code, “if the creditor forgives the debtor in part or in whole, the creditor’s right and debt shall be terminated in part or in whole, except that the debtor refuses within a reasonable period of time”. As of the date of reply, the company has not refused, so the debt relief has taken effect, and the two waivers have lost relevant creditor’s rights.
According to Article 9.3 of the stock listing rules (revised in 2020), “if the transactions of a listed company (except the donated cash assets of a listed company) meet one of the following standards, the listed company shall not only disclose them in time, but also submit them to the general meeting of shareholders for deliberation…” Transactions that meet certain standards shall be deliberated by the general meeting of shareholders of the company, but the company’s donated cash assets and non transactions need not be submitted to the general meeting of shareholders of the company for deliberation.
To sum up, debt exemption is a unilateral act of the creditor. According to the relevant provisions of the civil code and the stock listing rules (revised in 2020), debt exemption belongs to the unilateral beneficial act of the company. Whether the debtor considers the effective conditions of non debt exemption is established by the creditor unilaterally.
The company has fulfilled the obligation of information disclosure on January 6, 2022 in accordance with the stock listing rules (2020 Revision) (see the announcement on receipt of debt exemption notice (No.: 2022001) and there is no need to convene the board of directors and the general meeting of shareholders for deliberation.
As of the reply date, except that the relevant parties can “exercise the cancellation right” under the above “reply to question (1)”, the company has not found any other risks that can make the debt exemption ineffective, and has not found any other factors that lead to the uncertainty of the income of debt restructuring.
Accountant’s reply:
[as of the date of reply, it is still in the verification stage and has not made clear comments.]
2. If the number of days of overdue delivery of the shares with boguan financial is more than 10.2 days in the contract, the party shall have the right to terminate the creditor’s rights in accordance with article 10.2 of the contract. Please explain whether the transfer of creditor’s rights of RMB 406 million between Zhong’an finance and Zhong run boguan will be invalid if Zhong run boguan fails to pay the shares on time, resulting in the risk that Zhong run boguan’s exemption from the debt will be revoked. If so, please further explain whether there is significant uncertainty in the confirmation of debt restructuring income, and fully prompt the relevant risks. The annual audit accountant and lawyer shall check and give clear opinions.
Company reply:
If Zhongrun boguan fails to pay all (or part) of the shares on schedule, according to the corresponding provisions in the creditor’s rights transfer contract, Zhongan finance can take one or more measures to safeguard its own interests, such as confiscating the deposit, collecting liquidated damages, terminating the contract, signing a supplementary agreement and so on; The transfer of the creditor’s rights may be invalid due to the “termination of the contract” of Zhong’an finance, resulting in the risk of cancellation of the exemption of Zhongrun boguan from the debt.
If Zhongrun boguan subsequently pays the shares according to the creditor’s rights transfer contract, the debt restructuring income will not be recognized in 2021. Therefore, the net assets of the company’s 2021 annual financial statements will be negative after being audited by an accounting firm. It is expected to touch the provisions of article 9.3.1 of the stock Listing Rules (revised in 2022), and the company’s shares will be warned of delisting risk by Shenzhen Stock Exchange.
As of the reply date, except that the relevant parties can “exercise the cancellation right” under the above “reply to question (1)”, the company has not found any other circumstances that lead to the invalidation of the transfer of creditor’s rights of RMB 406 million between Zhong’an finance and Zhong run boguan, resulting in the risk of cancellation of the exemption of Zhong run boguan from the debt.
According to the memorandum signed with Shoutuo Rongsheng, a subsidiary of Zhongzhi enterprise group, and the relevant commitment letter issued by Shoutuo Rongsheng, the company is coordinating the transfer of shares from Shoutuo Rongsheng to Zhong’an finance, and does not rule out taking legal measures to urge it to fulfill its commitment to resolving the company’s debts.
Accountant’s reply:
[as of the date of reply, it is still in the verification stage and has not made clear comments.]
Lawyer’s reply:
[as of the date of reply, it is still in the verification stage and has not made clear comments.]
3. In combination with the answers to questions 1 and 2, please explain whether the debt exemption of Zhongrun boguan is unilateral, unconditional, irrevocable and irrevocable, and whether your company’s previous information disclosure is true, accurate and complete.
Company reply:
According to the shareholder’s decision of Xiamen zhongrunboguan Asset Management Co., Ltd. provided by zhongrunboguan, combined with the description of “our company voluntarily releases your company’s relevant debts to our company with the consent of the authority legally authorized” in the debt exemption notice issued by zhongrunboguan and the reply to “questions 1 and 2”, the company believes that the above acts have been effectively and fully authorized before they are issued, It complies with the laws, regulations and regulatory requirements applicable to debt exemption, and is a unilateral, unconditional, irrevocable and irrevocable exemption of the exempted person.
As of the reply date, no factors affecting the authenticity, accuracy and completeness of the company’s early information disclosure have been found, except that the relevant parties can “exercise the cancellation right” under the above “reply to question 2”.
4. Please explain the payment of 533333 million shares by Zhongrun boguan as of the date of reply, including but not limited to the source of shares, payment method, number of paid and unpaid shares and time schedule, and whether the payment of relevant shares may be bound by the new rules on reduction of holdings, resulting in failure to pay on schedule. If so, Please fully explain whether the transfer of creditor’s rights of RMB 406 million between Zhong’an finance and Zhong run boguan has become invalid due to actual non performance, and please prompt relevant risks.
Company reply:
As of the reply date, the company could not clarify the payment of 533333 million shares by China Resources boguan.
“Whether the payment of relevant shares may be bound by the new rules on reduction of holdings and other rules, resulting in failure to pay on schedule. If so, please fully explain whether the transfer of creditor’s rights of RMB 406 million between Zhong’an finance and Zhong run boguan has actually become invalid due to non performance”. Please refer to the reply to “questions 2 and 3”, and the specific details will be subject to the selection made by Zhong’an finance and the performance of Shoutuo Rongsheng’s commitment.
If Zhong’an finance exercises the right to unilaterally terminate the contract or raises an objection to the exemption in accordance with article 10.2.2 of the creditor’s rights transfer contract, and the objection is determined to be partially (or fully) valid by the competent authority or deemed to be revocable in other circumstances, there will be a risk that part (or all) of the exemption will be revoked, which may affect the company’s audit data. If the above matters occur or are deemed to be valid by the competent authority, Relevant financial data of the company may be adjusted.
The company will revise the performance forecast of 2021 before April 18 according to the above situation and in combination with the actual situation.
For details, see Announcement No. 2022026 on the possible delisting risk warning of the company’s shares. The information disclosure media designated by the company are China Securities News, securities times, Shanghai Securities News and http://www.cn.info.com.cn, All information of the company shall be subject to the official announcement published in the above designated media,
Please make careful decisions and pay attention to investment risks. We hereby reply.
Jinzhou Cihang Group Co.Ltd(000587) April 12, 2022
