*St Gaosheng (000971): Civil Judgment Received And Litigation Progress

Stock Code: 000971 stock abbreviation: * ST Gaosheng Announcement No.: 2020-78

Gaosheng Holding Co., Ltd. received the civil judgment of Ningbo intermediate people's Court of Zhejiang Province

Notice of proceedings

The company and all members of the board of directors guarantee that the contents of the announcement are true, accurate and complete, and there are no false records, misleading statements or major omissions.

Gaosheng Holding Co., Ltd. (hereinafter referred to as "Gaosheng holding" or "the company") received the civil judgment (2020) zh02 Minzhong No. 2645 issued by Ningbo intermediate people's Court of Zhejiang Province (hereinafter referred to as "Ningbo intermediate court") on September 14, 2020. The relevant matters are hereby announced as follows:

1、 Basic information of the case

On June 27, 2017, the company provided joint liability guarantee for the loan agreement signed by Beijing Shenzhou Baixi Cultural Industry Co., Ltd. (hereinafter referred to as "Shenzhou Baixi") and Ningbo Huahu Yinxie Investment Center (limited partnership) (hereinafter referred to as "Ningbo Huahu") due to the illegal use of the seal by the then chairman of the board. The loan amount was RMB 16683333.33 and the loan period was from December 2, 2017 8 to January 27, 2018.

The plaintiff Ningbo Huahu filed a lawsuit against the company and Shenzhou Baixi in the people's Court of Beilun District, Ningbo. The trial of Shenzhou Baixi was suspended on November 5, 2019 due to the bankruptcy reorganization procedure of Shenzhou Baixi. After the administrator took over the case, the case was resumed on May 12, 2020.

The people's Court of Beilun District of Ningbo City issued (2019) zh0206 early Republic of China No. 1990 civil judgment, and the results of the first instance judgment are as follows:

1. The defendant Shenzhou Baixi shall, within seven days from the effective date of this judgment, return to Ningbo Huahu a loan of RMB 16683333.33, and pay the interest based on the amount (calculated at the annual interest rate of 15% from December 28, 2017 to December 27, 2018, and 24% from December 28, 2018 to July 18, 2019);

2. The guarantee contract between Ningbo Huahu and the company is invalid. Due to the fault liability of improper seal management, the company shall be liable for the invalidity of the guarantee contract, and the scope of the liability shall be one-half of the part of the main debtor Shenzhou Baixi that cannot be paid off. Gaosheng holding has the right to claim compensation from the defendant Shenzhou Baixi after assuming the liability for compensation;

3. To reject other claims of the plaintiff Ningbo Huahu.

The company appealed the case on June 11, 2020.

The main contents of the second instance judgment

The company received the second instance judgment issued by Ningbo intermediate people's court, and the result is: reject the company's appeal and maintain the original judgment. The second instance case acceptance fee is 137431 yuan, which shall be borne by the company.

This judgment is final.

III. impact on the company and measures taken by the company

The court ruled that Shenzhou Baixi should repay the plaintiff Ningbo Huahu loan of 16683333.33 yuan and the interest. If Shenzhou Baixi fails to pay off, the company shall bear half of the compensation liability for the part that cannot be paid off. As Shenzhou Baixi is still in the bankruptcy liquidation stage, the company will face the risk of being enforced.

The company has hired external lawyers to apply for retrial or appeal of the case. If the company is forced to enforce the relevant compensation liability, the company will apply to the Shenzhou Baixi manager for creditor's rights and recover, so as to minimize the loss and the negative impact of the matter on the company, and safeguard the interests of the company and small and medium-sized investors. The company will continue to follow up the progress of relevant matters and fulfill the obligation of information disclosure in a timely manner.

The company has successively published the case on the designated information disclosure media. For details, please refer to the notice on the progress of freezing the shares of major shareholders, illegal guarantee and fund occupation of the company (Announcement No.: 2019-07), notice on receiving the summons and relevant legal documents and litigation progress of Beilun District People's Court of Ningbo City (Announcement No.: 2019-17), and Notice on reply to attention letter of Shenzhen Stock Exchange (Announcement No.: 2019-20, No.26), notice on receiving legal documents and litigation progress of Hangzhou intermediate people's Court of Zhejiang Province (Announcement No.: 2019-94), notice on reply to attention letter of Shenzhen Stock Exchange (Announcement No.: 2020-07), and notice on receiving Hangzhou intermediate people's Court of Zhejiang Province And other legal documents and litigation progress announcement (Announcement No.: 2020-51).

The company has no other litigation and arbitration matters that should be disclosed but not disclosed. The information disclosure media designated by the company are China Securities Journal, Shanghai Securities Journal, securities times, securities daily and www.cninfo.com.cn. All information of the company is subject to the announcement published by the company in the above media. Please pay attention to the company's announcement and investment risk.

It is hereby announced

Board of directors of Gaosheng Holding Co., Ltd

September 15, 2002