Securities code: Inner Mongolia Tianshou Technology&Development Co.Ltd(000611) securities abbreviation: Inner Mongolia Tianshou Technology&Development Co.Ltd(000611) Announcement No.: 202247
Inner Mongolia Tianshou Technology&Development Co.Ltd(000611)
Announcement on the reply of the company’s attention letter from the company management department of Shenzhen Stock Exchange
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.
Inner Mongolia Tianshou Technology&Development Co.Ltd(000611) (hereinafter referred to as “the company”) received the letter of concern on Inner Mongolia Tianshou Technology&Development Co.Ltd(000611) issued by Shenzhen Stock Exchange on April 17, 2022 (company Department attention letter [2022] No. 213, hereinafter referred to as “the letter of concern”). According to the requirements of the letter of concern, the company and the audit institution Lianda Certified Public Accountants (special general partnership) carefully verified and replied to the problems involved in the letter of concern, After the review of Shenzhen Stock Exchange, the reply to the attention letter is now disclosed as follows:
1、 On signing the settlement agreement on litigation cases
1. Please explain the main purpose of your company, Tianshou investment and Tiancheng mining to sign the settlement agreement of litigation cases, and timely and fully prompt whether the court can finally decide to agree to the settlement of relevant disputes. There are major uncertainties and related risks.
Company reply:
The main purpose of the litigation settlement agreement signed by the company, Tianshou investment and Tiancheng mining is to strive for a one-year grace period for repayment, alleviate the capital pressure of the company and relieve the risk of auction of Tianchi molybdenum shares held by Tianshou investment. After the settlement agreement is signed, it needs to be reported to the higher people’s Court of Jilin Province. It is still uncertain whether the higher people’s Court of Jilin Province will finally rule according to the content of the settlement agreement.
2. The transfer of relevant creditor’s rights by Tiancheng mining to Daheishan molybdenum industry has not been substantially solved, and your company still needs to continue
To fulfill the obligation of paying off the principal and interest of the equity transfer of RMB 284 million, please explain the substantive role of the above matters in resolving the debt risk, and whether the signing of the settlement agreement between your company and Tiancheng mining in April 2022 can eliminate the impact of the matters related to the qualified opinions of the 2020 audit report on your 2021 financial report and relevant audit opinions, Whether the annual audit accountant can determine that the qualified matters caused by the problems such as litigation and repayment of equity transfer funds have been eliminated. The annual audit accountant is requested to check and give clear opinions.
Company reply:
Jilin intermediate people’s Court ([2020] Ji 02 min Chu No. 463, [2021] Ji 02 min Chu No. 33) “civil judgment”, which ruled that Tianshou investment paid 284 million yuan and corresponding interest for the equity transfer of Tiancheng mining. After the Tianshou investment appeal of the company’s joint and several liability case, Jilin Provincial Higher People’s court has held a court session and has not yet made a judgment. According to the creditor’s right transfer notice of Tiancheng mining industry and the settlement agreement on litigation cases signed by the company, Tianshou investment and Tiancheng mining industry, the equity transfer payment of RMB 284 million and the corresponding interest payment are postponed until April 30, 2023. After the company, Tianshou investment and Tiancheng mining industry agree to a settlement, Tiancheng mining industry will not lift the judicial seizure and freezing measures on the equity of Tianchi molybdenum industry held by Tianshou investment, Keep the equity of Tianchi molybdenum industry held by Tianshou investment in the state of judicial seizure and freezing, and Tiancheng mining applies to the court to continue the judicial seizure and freezing of the equity of Tianchi molybdenum industry held by Tianshou investment until all funds are paid off before the expiration of the preservation period. Although the settlement agreement signed between the company and Tiancheng mining did not eliminate the company’s debt, it eased the company’s financial pressure, eliminated the risk of equity auction of Tianchi molybdenum industry, and bought time for the construction of Tianchi molybdenum mine. Whether the company’s 2021 financial report and the opinions of relevant audit institutions can eliminate the reservations on relevant matters in the 2020 audit report, the company will be subject to the final audit opinion of the audit institution.
Annual audit accountant’s opinion:
On April 15, 2022, the company signed the settlement agreement of litigation cases with relevant parties and received the notice of debt transfer from Jilin Tianchi Mining Co., Ltd. We have checked whether the above matters can be determined that the qualified matters caused by the litigation and repayment of the equity transfer in the 2020 audit report have been eliminated.
The settlement agreement on litigation cases signed by the company and relevant parties stipulates that Tiancheng company applied for property preservation of Tianshou development and Jilin Tianshou in the litigation. According to the application of Tiancheng company, Jilin Tianshou’s equity in Tianchi molybdenum industry was frozen by the court according to law, and the freezing period is from October 15, 2020 to October 14, 2022. Both parties agree that after this Agreement comes into effect, Tiancheng company will not lift the judicial seizure and freezing measures on the equity of Tianchi molybdenum industry held by Jilin Tianshou, keep the equity of Tianchi molybdenum industry held by Jilin Tianshou in the state of judicial seizure and freezing, and Tiancheng company applies to the court to continue the judicial seizure and freezing of the equity of Tianchi molybdenum industry held by Jilin Tianshou until all funds are paid off; Tianshou development shall be jointly and severally liable for all payment obligations of Jilin Tianshou determined in Items 1 and 2 of Article 2 of this agreement.
Through verification, we believe that although the company has reached the settlement agreement on litigation cases with relevant parties, it has not been substantially resolved, and the company still needs to continue to perform the obligation to pay off the principal and interest of the equity transfer of RMB 284 million, and the equity of Tianchi molybdenum industry held by Jilin Tianshou continues to be sealed up and frozen by the judiciary before the date when all the funds are paid off. There is still uncertainty about whether the higher people’s Court of Jilin Province will finally rule according to the content of the settlement agreement. Therefore, the bourse believes that the major litigation matters involved in the reserved matters of the company’s 2020 audit report have not been eliminated, and the company still has the pressure to pay off the principal and interest of RMB 284 million equity transfer.
3. Please explain the specific arrangements for the subsequent repayment of the principal and interest of the equity transfer of RMB 284 million, including but not limited to the source of repayment and whether the debt of your company can be substantially solved, and give timely and sufficient tips on the risk of the compulsory execution and sale of the equity of Tianchi molybdenum industry due to the failure to repay the debt on schedule.
Company reply:
The company has applied to China China Construction Bank Corporation(601939) Jilin Branch for a loan of 690 million yuan. China China Construction Bank Corporation(601939) Jilin Branch has issued the letter of intent loan commitment to Tianchi molybdenum industry. China China Construction Bank Corporation(601939) Jilin Branch will conduct detailed investigation and evaluation on the loan matters in accordance with the relevant provisions of the commercial bank law, the general principles of loans and the measures for the administration of bank credit business. Under the implementation of all the following conditions, It will provide a fixed asset loan of 69 million yuan (RMB) for the project of processing 25000 tons of molybdenum ore per day in Jide molybdenum mine in Xiaocheng: (1) the loan has been approved by our bank and other loan conditions required by our bank have been implemented; (2) Sign loan contract with our bank; (3) This letter of intent loan commitment is valid for one year; (4) The letter of intent loan commitment is used for the audit of the financial report of your group in 2021. The letter of intent to grant the loan is not legally binding, but only based on the letter of intent.
The loan fund failed to advance smoothly due to the closure of Jilin City, and the relevant procedures need to be handled after the closure of Jilin City. The fund will effectively solve the financial pressure of the construction of molybdenum mine, the holding subsidiary of the company. At present, the epidemic situation in Jilin has been eliminated, and the unsealing is just around the corner. The employees of Tianchi molybdenum industry sealed in the work area are preparing for the opening work. If the funds are in place, Tianchi molybdenum industry will carry out the construction according to the project schedule. It is feasible to put into operation in the current year and pay off the principal and interest of 284 million yuan of equity transfer; If Tianchi molybdenum fails to advance the construction according to the project progress and the equity transfer of RMB 284 million cannot be repaid on schedule, it will still lead to the risk of compulsory execution and sale of Tianchi molybdenum’s equity.
2、 About foreign borrowing
4. Please indicate whether the above 390 million yuan loan has been fully received as of the date of reply, and if so, provide relevant supporting materials; If not, please explain the reasons for not arriving in time and the main obstacles, the impact on the follow-up construction of your company’s molybdenum mine project, and give timely and sufficient tips on relevant risks.
Company reply:
According to the loan contract signed between Tianshou investment and Daheishan molybdenum industry on March 22, 2022, Tianshou investment borrows 390 million yuan from Daheishan molybdenum industry, all for the project funds, equipment funds and loans for the continuous operation and construction of Tianchi molybdenum industry. The loan period is 12 months from April 20, 2022 to April 19, 2023. As of April 20, 2022, Daheishan molybdenum has remitted 290 million yuan to the Tianshou investment account and promised to transfer the remaining funds before April 28, 2022. If the remaining payment is overdue or fails to reach the account, it will have an impact on solving the problem of arrears in the early construction payment returned by Tianchi molybdenum industry.
5. Please explain the mine construction and construction progress of Tianchi molybdenum industry as of the date of reply, the project construction plan after the loan funds are in place, the estimated production time, and the fund use plan of 390 million yuan of loan funds for various purposes.
Company reply:
According to the loan agreement between Tianshou investment and Daheishan molybdenum industry, all the funds provided by Daheishan molybdenum industry are used for the project funds, equipment funds and loan repayment for the continued operation and construction of Tianchi molybdenum industry, including: (1) the 100 million yuan loan applied by Tianchi molybdenum industry to Bank Of China Limited(601988) Weinan branch through Shaanxi Huaguang Industrial Co., Ltd; (2) The project progress payment of 140 million yuan and liquidated damages paid by Shaanxi nonferrous metals Construction Co., Ltd. for Tianchi molybdenum industry during the litigation period; (3) The project progress payment paid in advance for mining and rock mining, stripping and transportation of Xiaocheng Jide molybdenum mine open pit mining project of Yanzhou Sinoma Construction Co., Ltd. shall be paid.
The construction progress of Tianchi molybdenum mine is:
(1) External power supply system: the underground part of 66kV general step-down substation has been completed, and the remaining works can be completed within 6 months;
(2) External water supply system: water source pump station, backwater pump station and high-level pool have been built. The design length of external water supply pipeline is 4300m, and 1800m has been completed; The design length of return water pipeline is 4940m, and 600m has been completed; The remaining works can be completed within 6 months.
(3) At present, 10 working steps have been formed in the mining site, and the stock of by-product ore stockpile is 3096100 tons. According to the capital construction quantity plan, 522900 m of mining and stripping is required before putting into operation ³， The stope has a capacity of 800000 m per month ³ The stripping capacity is planned to be put into operation in October. The mining site can meet the requirements of the project production period.
(4) The tailings pond area can complete the remaining works within 5 months and meet the conditions of commissioning with materials.
(5) The remaining steel structures of unfinished works such as 1, 2, 3, 4 belt Gallery, ore storage pile, hard rock crushing room and other buildings have not been constructed; The motors of semi autogenous mill and ball mill are not installed; The transmission mixing device is not installed, other equipment not installed in the concentrator, non-standard structural parts of the concentrator, various pipelines, electrical equipment and cables can be completed under the condition of proper organization and careful planning.
The construction period of Tianchi molybdenum project has been reviewed by experts in the industry and assigned tasks according to the management mode of clear primary and secondary and control nodes. The goal of commissioning with materials can be achieved by the end of October 2022.
6. Please explain whether such external borrowings can become a stable source of funds for the construction of molybdenum mine project, whether they can effectively solve the problem of sustainable operation of molybdenum mine project, and give timely and sufficient tips on relevant risks under the condition that there are many constraints on the loan agreement of Daheishan molybdenum industry and there is great uncertainty about the loan term.
Company reply:
Daheishan molybdenum industry has agreed many constraints on providing loans to the company. The company believes that Daheishan molybdenum industry is the capital provider, and how to ensure the capital safety of its external loans is one of its first considerations. It is reasonable that all the funds provided by Daheishan molybdenum industry are used for the project funds, equipment funds and loan repayment for the continued operation and construction of Tianchi molybdenum industry, and will not be used as a stable source of funds for the later construction of molybdenum mine project, However, if the following events occur in the loan, Daheishan molybdenum industry has the right to recover all the loan in advance, (1) Tianshou investment transfers all or part of its equity of Tianchi molybdenum industry without the consent of Daheishan molybdenum industry; (2) Breach of this agreement occurs in Tianshou investment; (3) The listing of Tianshou development was terminated; (4) The date of expiration of the loan term is the repayment date; If Party A announces the early maturity of the loan, the 7th day from the date of announcing the early maturity shall be the repayment date.
The loan provided by China China Construction Bank Corporation(601939) Jilin branch includes the repayment of the loan of 390 million yuan, and the remaining part is the construction fund of Tianchi molybdenum industry. The loan fund cannot be smoothly promoted due to the closure of Jilin City, and the relevant procedures need to be handled after the closure of Jilin City. However, as the loan fund is still being handled and promoted, there is still uncertainty.
7. Please analyze and explain the source of subsequent debt repayment funds and whether there are major debt repayment risks of your company in combination with the construction of Tianchi molybdenum project, cash flow, asset liability ratio and other factors.
Company reply:
At present, the self owned capital of Tianchi molybdenum industry is 33 million yuan, the cash inflow of tax rebate in the next year is 64 million yuan, the financing amount approved is 390 million yuan, and the loan to be applied to China China Construction Bank Corporation(601939) Jilin branch is 690 million yuan (390 million yuan of the 690 million yuan loan is used to repay the loan). The future infrastructure expenditure is 764 million yuan. Tianchi molybdenum industry is expected to be put into trial operation at the end of October 2022, After the trial operation, if it is expected to be able to repay the subsequent debts, there is no significant debt repayment risk.
8. Please say that tomorrow’s first investment will be in March 2022, first borrowing from others, and then providing loans to Tianchi molybdenum industry. For your 2021 financial report and relevant audit opinions, can you eliminate the impact of the matters related to the qualified opinions in the 2020 audit report, and can the annual audit accountant confirm that the qualified opinions caused by the source of funds for the construction of Tianchi molybdenum mine have been eliminated. Ask the annual audit accountant to check and give clear opinions. Company reply:
Tianshou investment will lend the loan to the bank in March 2022
