Securities code: 600694 securities abbreviation: Dashang Co.Ltd(600694) Announcement No.: 2022-004 Dashang Co.Ltd(600694) announcement on Retrial of civil litigation application
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 content tips:
The litigation stage of the case: after receiving the judgment of second instance, it is proposed to file an application for retrial
The party status of the listed company: plaintiff of the first instance and appellant of the second instance
Amount involved: the original litigation amount is 924404818.60 yuan, and the current litigation amount is 1188959291.54 yuan
Whether it will have a negative impact on the profits and losses of the listed company: the company plans to file a retrial application for this judgment. At present, it is impossible to judge the impact on the current or future profits of the company
1、 Basic information of this prosecution
(I) background of this lawsuit
Dashang Co.Ltd(600694) (hereinafter referred to as “the company”) and its subsidiary Dashang Co.Ltd(600694) Zhengzhou Commercial Investment Co., Ltd. (hereinafter referred to as “Dashang Zhengzhou company”) based on the special agreement on Jinbo Dacheng project cooperation signed with Xinda Investment Co., Ltd. (hereinafter referred to as “Xinda investment”), the company filed a lawsuit against Xinda investment because Xinda investment failed to fully perform the agreement. The company believes that the determination of land transfer and rent standards between the company and Xinda investment and Henan jinboda Investment Co., Ltd. (hereinafter referred to as “jinboda company”, which is a wholly-owned subsidiary of Xinda investment) are based on the overall agreement on jinboda City Project in the special agreement on jinboda city project cooperation, and the land transfer and rent marking are based on this premise, The root cause of relevant disputes and lawsuits between the two parties is that Cinda investment failed to fully perform the special agreement on Jinbo city project cooperation. Therefore, in order to safeguard the interests of the company, the company filed a lawsuit against Xinda investment on the special agreement on Jinbo city project cooperation. (II) basic information of this lawsuit
In September 2021, the company and its subsidiary Dashang Zhengzhou company filed a lawsuit with Beijing Higher People’s Court (hereinafter referred to as “Beijing High Court”) on the civil judgment of Beijing Second Intermediate People’s Court ([2020] jing02)
Appeal against the judgment (No. 126) and the claims are as follows: 1. Revoke (2020) Jing 02 min Chu No. 126 civil judgment; 2. Ruling to send the case back to the court of first instance for retrial, or rescind the special agreement on Jinbo grand city project cooperation involved in the case according to law due to the breach of the appellee’s Xinda investment, and supporting the appellant Dashang Co.Ltd(600694) and Dashang Co.Ltd(600694) Zhengzhou Commercial Investment Co., Ltd. for other litigation claims except for the loss of 218 million yuan of expected benefits; 3. The appellee Xinda investment was ordered to bear the litigation costs of the first and second instance of the case. For details, see Dashang Co.Ltd(600694) appeal announcement on Civil Litigation (Announcement No. 2021-060).
(III) facts of the case
In 2006, the company rented Jinbo Mall for three years. Jinboda company is the owner of jinboda city and a wholly-owned subsidiary of Xinda investment. On September 9, 2009, the company and Cinda investment reached an agreement on the renewal of the lease: the lease term of the company is 3 + 10 years, the rent is 100 million yuan per year in the first three years, and the rent base is 106.5 million yuan from the fourth year, increasing by 4.2% every three years during the 10-year period.
On December 22, 2009, Xinda investment signed the cooperation agreement on Jinbo grand city expansion project with the people’s Government of Erqi District, Zhengzhou City, stipulating that Xinda investment company has the right to obtain the land use right of 1# plot, together with the unused part of the plot where Jinbo grand city is located (i.e. plot 2, and the developed plot where Jinbo grand city is located is plot 3) as the common project land, Reconstruct and expand the existing Jinbo city. On January 15, 2010, the company signed the special agreement on Jinbo city project cooperation with Xinda investment, which agreed that the company would take over the development of “Jinbo city expansion project”, and the transferee of the project expansion right includes three conditions: 1. The company shall bear the cost and interest invested (i.e. RMB 3.8948 million) and pay the transferee of RMB 75 million; 2. Xinda investment transfers the 2# plot to the company; 3. The company will submit the external decoration of Jinbo Grand City Phase I and the addition of one floor of the shopping mall for approval. At the same time, as an important part of the agreement, both parties adjusted the rent of Jinbo grand city, increased the annual rent of the last three years of the four-year lease period of the first stage from RMB 100 million to RMB 130 million, and increased the annual rent of the 10-year lease period of the second stage to RMB 132.184 million. Each year’s rent increased by 1.68% on the basis of the rent of the previous year. The two parties signed a lease contract according to the increased rent standard, and the company paid 75 million yuan for the project transfer and 3.8948 million yuan for expenses and interest.
On December 17, 2010, the company funded the establishment of Dashang Zhengzhou company as the project company for the development and construction of “Jinbo city expansion project”, specifically implementing the special agreement on Jinbo city project cooperation. Dashang Zhengzhou company obtained the land use right of 14.92 mu of 1# plot through bidding, auction and listing in March 2014, and paid 186.9 million yuan of land transfer fee and taxes. However, since the transfer of the land use right of 2# plot must be divided with the land use right of 3# plot, jinboda did not fully disclose the ownership information of the co owner of 2# plot, and continued to sell the aboveground real estate after signing the land transfer agreement, resulting in the failure to handle the Division and transfer procedures of 2# plot. According to the special agreement on Jinbo city project cooperation, Xinda investment company will transfer the land use right of the 2# plot to the company or the project company before the company can develop and construct the “Jinbo city expansion project”. The failure to complete the transfer of 2# pieces of land use right not only constitutes the breach of jinboda company under the land transfer agreement, but also constitutes the breach of Xinda investment company under the special agreement on jinboda city project cooperation. The above breach of contract of Cinda investment led to the company’s failure to obtain the construction planning license of the expansion project, the “Jinbo city expansion project” could not be started at all, and the contract purpose of the company’s transfer of the expansion right of the expansion project for the overall development of the project could not be realized.
2、 Progress of this lawsuit
Recently, the company received the civil judgment ([2021] JMZ No. 903) delivered by the Beijing high court. The judgment is as follows:
The appeal was dismissed and the original judgment upheld.
The case acceptance fee of the second instance is 4896596.46 yuan, which is jointly borne by Dashang Co.Ltd(600694) and Dashang Co.Ltd(600694) Zhengzhou Commercial Investment Co., Ltd.
The company intends to file a retrial application for the result of this judgment. The main reasons and basis are as follows:
1. The transfer of land use right of 2# plot is an important contractual obligation of Cinda company as agreed in the special agreement on Jinbo grand city project cooperation. Cinda company’s failure to transfer 2# plot to the company constitutes a breach of contract and shall bear the liability for breach of contract;
2. Xinda company’s failure to complete 2# land use right transfer has directly led to the failure to achieve the purpose of the special agreement on Jinbo grand city project cooperation, and the company has the right to terminate the contract according to law.
3、 Impact on the company’s profits in the current period or after the period
The company plans to file a retrial for this judgment, and it is impossible to judge the impact on the company’s profits in the current period or after the current period. The company will timely perform the obligation of information disclosure according to the progress of litigation. Please pay attention to the investment risk.
It is hereby announced.
Dashang Co.Ltd(600694) board of directors January 14, 2022
