*ST Kerry (002072): Alleged Infringement Of Reputation Right

Stock Code: 002072 securities short: *ST Kerry announcement number: 2019-L104

Kerid Cmi Holdings Ltd's notice on alleged infringement of reputation right

All members of the company and the board of directors guarantee that the contents of the information disclosure are true, accurate and complete, without false records, misleading statements or major omissions.

I. The basic situation of litigation matters

Kerid Cmi Holdings Ltd (hereinafter referred to as the "company") received the "Notice of complaint" delivered by the people's Court of Decheng District in Dezhou in October 30, 2019. The Shandong cotton Group Co., Ltd. (hereinafter referred to as the "German cotton group") filed a lawsuit with the people's court of Dezhou city in the grounds of the infringement of reputation rights.

Two. The basic situation of the case.

1. Case Party

Plaintiff: the legal representative of Shandong decotton Group Co., Ltd.: Li Huijiang's address: No. 18, Shun he West Road, Decheng District, Dezhou. Kai: Reed, the legal representative of the Cmi Holdings Ltd: Li Yanmei's residence: No. 18, Shun he road, Decheng District, Dezhou.

2. Case facts and reasons

Since June 24, 2017, the company has disclosed the progress announcement, semi annual report and annual report of the major asset sale publicly disclosed, and disclosed that the German cotton group failed to pay the transaction price in full in accordance with the arrangement of payment arrangements, and fabricate the fact of arrears of the German cotton group. In particular, the company's reply to the annual inquiry letter of the Shenzhen Cmi Holdings Ltd on the 2019 stock exchange of 2019 by the Kai Reed Cmi Holdings Ltd (Announcement No.:

2019-L088) clearly states: "after examination, the total amount of the specific amount payable by the counterparty (that is, the German cotton group) should be paid at the moment and not paid for the transaction amounts to 277228699 yuan".

The above disclosure is seriously untrue, the company deliberately fabricated, and the German cotton group did not pay any amount to the company, which seriously damaged the reputation right of the German cotton group and infringed the lawful rights and interests of the German cotton group. The specific facts and reasons are as follows:

(1) the sale of major assets of Kai Reed Cmi Holdings Ltd signed by the German cotton group and the two companies.

The framework agreement and Kai Reed Cmi Holdings Ltd supplemental agreement for the sale of major assets are truly effective and have been fully implemented. The German cotton group does not owe any transaction price to the company. In February 4, 2015, the German cotton group signed the "Reed Dezhou Cmi Holdings Ltd's major asset sale framework agreement" with the company. The agreement agreed that the company will sell 100% of its own shareholding of Jinmian Textile Co., Ltd. (hereinafter referred to as "Jinmian textile") and the textile equipment and some debt and debt owned by the company. In July 22, 2015, the German cotton group signed a supplementary agreement with the company on the sale of major assets of Kai Reed Cmi Holdings Ltd. The agreement expressly agreed that the transfer price would be 488 million 529 thousand and 500 yuan. In December 2015, the German cotton group paid 158 million 700 thousand yuan of cash to the company; in April 2016, the German cotton group paid 125 million 625 thousand and 100 yuan to the company; in July 20, 2016, the cotton group, the company and the Zhejiang fifth quarter Industrial Co., Ltd. signed the "agreement on payment by agreement", which agreed that the fifth quarter Industrial Co., Ltd. of Zhejiang in August 2016 and December was entrusted by the German cotton group to pay 100 million yuan and 104 million 204 thousand and 400 yuan to the company respectively. At the same time, the company announced the announcement on the progress of major asset sale in January 26, 2017 (2017-L006). It clearly disclosed that as of this announcement, the fifth quarter Industrial Co., Ltd. of Zhejiang has fulfilled all commitments on the price through the sale of the remaining textile assets on behalf of the fifth quarter (Shenzhen) Asset Management Co., Ltd., and the company has received all the assets sold and transferred for 488 million 529 thousand and 500 yuan.

It can be seen from the above that all assets paid out by the German cotton group to the company have been fully paid for the price of 488 million 529 thousand and 500 yuan, and have been confirmed by the company's announcement.

(2) the company blatantly violates the fact that the debt has been publicly repaid before, and fabricates facts in the open media channels. It defames the fact that the company has paid 277228669 yuan to the company, and there is an illegal fact that infringes the reputation right of the German cotton group.

Since June 24, 2017, the company announced the announcement of the progress of the major asset sale (2017-L055). The company has disclosed in the public announcement of the major asset sale fact progress announcement, semi annual report and annual report that the German cotton group failed to pay the transaction price in full within the agreed time limit for the payment arrangement of textile assets. In particular, in September 6, 2019, the company disclosed in the reply of Kay Reed Cmi Holdings Ltd about the Shenzhen stock exchange 2019 semi annual report inquiry letter (Bulletin number: 2019-L088), clearly stated: "after checking, the counterparty (that is, the German cotton group) should pay at present and the total amount of the specific amount of the transaction paid for the transaction is 277228699 yuan". This is not only related to the company's announcement of the progress of major asset sales in January 26, 2017.

(2017-L006) the contents contradict each other, and it is a factual fact that the illegal facts of the decotton group's reputation are infringed upon, and the evidence is conclusive.

(3) the illegal fact of the company has seriously damaged the legitimate rights and interests of the German cotton group and refused to correct it after the serious warnings and letters sent by the German cotton group. It has caused losses to the reputation of the German cotton group. According to the relevant provisions of the general principles of the civil law and other relevant laws and regulations, it should immediately stop the infringement and eliminate the impact, and make an apology to the German cotton group to clarify the facts to the public.

3. Litigation request

(1) to order the defendant to immediately stop issuing any false information of the plaintiff's payment of the assets transaction to any price in the open media, including, but not limited to, the annual report and the announcement of any information disclosure of the listed company; (2) the defendant is ordered to make an apology and clarification of the facts to the plaintiff through the media with a nationwide influence, so as to eliminate the adverse effects caused by his false information disclosure to the plaintiff's reputation.

(3) to order the defendant to bear the costs of litigation and other related expenses.

Three. Judgement and Adjudication

As of this announcement, the case has not yet been heard.

Four. Other undisclosed litigation and arbitration matters

In addition to the litigation items disclosed in the daily disclosure and periodic reports, as of the date of announcement, the company will hire a lawyer to check and comb all the litigation items of the company, and the company will promptly supplement and disclose other litigation items that should be disclosed and not disclosed according to the information disclosure standards according to the verification results.

Five. The possible impact of this lawsuit on the company's current profits or future profits.

In July 23, 2015, the company disclosed the sale of major assets (Draft). The company sold the 100% stake of Dezhou Jinmian Textile Co., Ltd., the textile equipment and part of the debt and debt portfolio to the decotton group agreement, and the price was 488 million 529 thousand and 500 yuan based on the assessment. After the company's creditor refused to transfer the creditor's rights to the 100% stake of the German cotton group and Dezhou Jinmian Textile Co., Ltd., it was frozen to be unable to transfer the transfer and many other factors. The company and Jinmian textile finally transferred the assets to the decotton group for a total of 819 million 617 thousand and 100 yuan. Up to now, the assets transaction received by the company amounts to 538 million 546 thousand and 900 yuan, and 281 million 70 thousand and 200 yuan has not been recovered. In accordance with the relevant provisions of information disclosure, the company has issued a progress announcement, a semi annual report and an annual report on the sale of major assets from the preparatory stage of the sale of major assets, disclosing the progress of the implementation of the sale of major assets, and does not have the right to empower the right of reputation.

In response to the litigation, the company will take necessary action measures, including but not limited to prosecution, counterclaim and appeal.

And so on, actively advocate the company's rights and protect the legitimate rights and interests of the company and shareholders. Due to the fact that the case has not yet been heard and judged, it is not yet possible to judge the profit impact of the company in the current and subsequent periods. The company will fulfill its obligation of information disclosure in accordance with the progress.

Six. Reference documents

Notice of the people's Court of Dezhou Decheng

It is hereby announced.

Kerid Cmi Holdings Ltd board of directors

October 30, 2019