Securities code: China Security Co.Ltd(600654) securities abbreviation: St Zhong’an Announcement No.: 2022028 bond Code: 136821 bond abbreviation: 16 Zhong’an consumer
Suggestive announcement on the application of controlling shareholders for bankruptcy reorganization
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.
Zhongheng Huizhi applied for bankruptcy reorganization to Shenzhen intermediate people’s Court of Guangdong Province on its own on the grounds of “obvious lack of solvency” and “high reorganization value”.
It is uncertain whether the bankruptcy will be accepted by the court and whether the reorganization will be carried out smoothly.
The reorganization may lead to changes in the actual control of the listed company, and it will also lead to uncertainty in the performance of Zhongheng Huizhi on matters related to the performance compensation of the listed company.
The bankruptcy reorganization will not affect the daily production and operation of the listed company. As of the disclosure date of this announcement, the production and operation of the listed company is normal.
1、 Application for bankruptcy reorganization by controlling shareholders
Recently, China Security Co.Ltd(600654) (hereinafter referred to as “listed company” and “zhonganke”) received the notification letter from the controlling shareholder Shenzhen Zhongheng Huizhi Investment Co., Ltd. (hereinafter referred to as “Zhongheng Huizhi”), It said that “due to the comprehensive influence of financial risks and investment decisions, Zhongheng Huizhi company has insufficient working capital and is unable to pay off its due debts. Its existing assets have been frozen and waiting to be frozen by many courts, and it is unable to release assets for debt repayment or refinancing, which has obviously lacked solvency”. At the same time, “Zhongheng Huizhi company has rich industry experience and talent advantages, strong technical strength and product manufacturing capacity, comprehensive industry qualification and high reorganization value. It hopes to save the company itself through reorganization and maximize the interests of the company, shareholders, employees and creditors.”
On April 12, 2022, Zhongheng Huizhi applied for bankruptcy reorganization to Shenzhen intermediate people’s Court of Guangdong Province (hereinafter referred to as “Shenzhen intermediate people’s court”) on its own on the grounds of “obvious lack of solvency” and “high reorganization value”.
At present, the application and other materials have been received by Shenzhen intermediate people’s court and have not been officially accepted. The bankruptcy reorganization application of Zhongheng Huizhi still needs to be reviewed by Shenzhen intermediate people’s court, and there is significant uncertainty whether the court will accept it or not.
2、 Impact of bankruptcy reorganization of controlling shareholders on the company and relevant explanations
1. Whether the bankruptcy reorganization of Zhongheng Huizhi is accepted by the court and whether it can be implemented smoothly is uncertain. If the reorganization can be implemented smoothly, it will help to improve the asset liability structure of Zhongheng Huizhi; If the reorganization cannot be implemented smoothly, Zhongheng Huizhi is at risk of being declared bankrupt.
2. The bankruptcy and reorganization of Zhongheng Huizhi may lead to the adjustment of its shareholders’ equity, and then lead to the change of the actual control of the listed company.
3. Zhongheng Huizhi has performance compensation for listed companies. Bankruptcy and reorganization may lead to uncertainty in the performance of matters related to performance compensation.
As of the disclosure date of this announcement, due to its own debts and litigation reasons, all the shares of listed companies held by Zhongheng Huizhi have been frozen by the judiciary, including 48691587 shares held in the special account set up for the shares that should be compensated for the profit forecast. Zhongheng Huizhi has not fulfilled the obligation of share compensation according to its performance compensation commitment. In order to effectively safeguard the legitimate rights and interests of listed companies and minority shareholders and actively promote the implementation of compensable shares, the listed company has submitted a civil complaint to the Shenzhen intermediate people’s court, requesting the court to make a judgment and confirm that the shares held in the special account set up by Zhongheng Huizhi for profit forecast compensable shares do not belong to the property of Zhongheng Huizhi, and its rights are the registered shareholders of the listed company (see announcement: 2019010 for details). On July 24, 2020, the Shenzhen intermediate people’s Court issued a civil judgment (2019) Yue 03 min Chu No. 600, confirming that 48691587 shares in the special account are owned by the registered shareholders (except the shares held by Zhongheng Huizhi for the purchase of assets due to the reorganization and issuance of shares) on the equity registration date of the general meeting of shareholders of China Anke or the equity registration date determined by the board of directors of China Anke (see announcement: 2020048 for details). On August 10, 2020, one of the defendants in the original trial Sinolink Securities Co.Ltd(600109) filed an appeal. As of the disclosure date of this announcement, the higher people’s Court of Guangdong Province has accepted the appeal case, but has not made a judgment of second instance.
Meanwhile, the profit commitment period of Shenzhen Kesong Technology Co., Ltd. has expired and the performance commitment has not been realized. According to the profit forecast compensation agreement signed by both parties, Zhongheng Huizhi, the former shareholder of Shenzhen Kesong Technology Co., Ltd., still needs to compensate the listed company with 331778 million yuan in cash (see announcement: 2018031 for details). As of the disclosure date of this announcement, Shenzhen zhonghengzhi Investment Co., Ltd. has not compensated the listed company for the remaining cash of 331778 million yuan.
The listed company will pay close attention to the impact of the reorganization of Zhongheng Huizhi on the performance compensation, and actively and effectively safeguard the rights and interests of the listed company and minority shareholders.
4. On February 28, 2022, the Shenzhen intermediate people’s court filed a dispute over the repurchase contract between China Merchants Securities Co.Ltd(600999) Asset Management Co., Ltd. and Zhongheng Huizhi securities at the judicial auction platform of the Shenzhen intermediate people’s Court of Guangdong Province on jd.com（ http://sifa.jd.com./2577 ）In the online judicial auction, 38355787 restricted tradable shares of listed companies held by henghuizhi, accounting for 2.99% of the total share capital of listed companies (see announcement: 2022022 for details). As of the disclosure date of this announcement, the listed company has not received the auction transaction ruling issued by Shenzhen intermediate people’s court, and the subsequent procedures such as paying the balance of the auction and handling the equity transfer are still involved, and the final result is still uncertain.
5. As of the disclosure date of this announcement, Zhongheng Huizhi holds 527977838 shares of listed companies, accounting for 41.15% of the total share capital of listed companies, including 479098000 Pledged Shares, accounting for 90.74% of the total shares of listed companies and 37.34% of the total share capital of listed companies; A total of 527977838 shares were frozen, accounting for 100.00% of the total shares of the listed company and 41.15% of the total share capital of the listed company. If the equity transfer of the above auction matters is completed, the actual controller, Mr. Tu Guoshen, will hold 489622051 shares of the listed company through Zhongheng Huizhi, accounting for 38.16% of the total share capital of the listed company. The number of shares held by Zhongheng Huizhi will be passively reduced accordingly, resulting in changes in equity.
6. The listed company has independent and complete business and independent operation ability, and is independent of the controlling shareholders and their related parties in terms of business, personnel, assets, institutions and finance. The bankruptcy reorganization of the controlling shareholder will not have an impact on the daily production and operation of the listed company. As of the disclosure date of this announcement, the production and operation of the listed company is normal.
7. The listed company will continue to pay attention to the follow-up progress of relevant matters and fulfill the obligation of information disclosure in time. The designated information disclosure media of listed companies are China Securities News, Shanghai Securities News and the website of Shanghai Stock Exchange (www.sse. Com. CN), All information of the company is subject to the information disclosed in the above designated media and websites. Please pay attention to the investment risks.
It is hereby announced.
China Security Co.Ltd(600654) board of directors
April 24, 2002
