Shenzhen Textile A (000045): Involving Arbitration Results

Shenzhen textile (Group) Co., Ltd

Announcement on the result of arbitration involving the company

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.

The dispute over the cooperation agreement between Shenzhen textile (Group) Co., Ltd. (hereinafter referred to as "the company" or "the respondent") and Hangzhou Jinjiang Group Co., Ltd. (hereinafter referred to as "Jinjiang Group" or "the applicant") has been heard by the seventh arbitration tribunal of Shenzhen International Arbitration Court on December 1, 2020. The company has recently received the (2020) Shenzhen Arbitration delivered by the arbitration tribunal The details are as follows:

I. Basic information of this arbitration case

(1) the parties to the arbitration

Applicant: Hangzhou Jinjiang Group Co., Ltd

Respondent: Shenzhen textile (Group) Co., Ltd

(2) arbitration institution: Shenzhen International Arbitration Court

(3) seat of arbitration institution: Shenzhen

(4) arbitration hearing time: December 1, 2020

(5) the reasons for the applicant's claim contained in the application for arbitration

The applicant holds that, subject to the management system of the wholly-owned state-owned enterprise still being implemented by the respondent and the Shenzhen Shengbo Optoelectronic Technology Co., Ltd. (hereinafter referred to as "Shengbo optoelectronics"), after the capital increase, the applicant can not actually dominate the operation and management of Shengbo optoelectronics, and can not give full play to the advantages and industries of the applicant in terms of system, mechanism, industry and management Due to the successful experience of integration, it is impossible to realize the production line linkage, industrial integration and resource integration of Shengbo optoelectronics as expected. As a result, the contract purpose of the cooperation agreement can not be realized at all, and the contract basis for the applicant to make performance commitment and make up for profits has disappeared. In this case, it is obviously unfair for the applicant to continue to fulfill the performance commitment and make up obligation under the cooperation agreement, and the purpose of the contract can not be achieved.

(6) the applicant's claim for arbitration

1. Ruling that the applicant shall be exempted from the performance compensation obligation in 2019 stipulated in Article 3.1 of the cooperation agreement, that is, the applicant will no longer pay RMB 244783800 to Shengbo optoelectronics;

2. If the arbitration tribunal does not support the first arbitration claim after hearing, then: request for an award to terminate Article 3.1 of the cooperation agreement; the respondent shall compensate the applicant for the compensation of 197268700 yuan paid by the applicant in 2018; and the respondent shall compensate the applicant for the loss of profits that could have been obtained by the applicant by 202340700 yuan;

3. Award the respondent to bear the arbitration fee and the actual expenses of the arbitration tribunal.

II. The award of this arbitration case

On March 25, 2021, the arbitral tribunal made the following ruling on the case:

(1) the applicant is exempted from the performance compensation obligation in 2019 as stipulated in Article 3.1 of the cooperation agreement, and is not required to pay 244783800 yuan for the performance difference compensation in 2019 to Shengbo optoelectronics;

(2) the arbitration fee of RMB 2682011 and the actual expenses of the arbitrators of RMB 8000 shall be borne by the applicant;

(3) it does not support the other arbitration claims of the applicant.

This award is final and has legal effect from the date of its making.

III. The impact of the arbitration matters announced this time on the company

The arbitration is final, and the award will not affect the company's profit and loss, and will not affect the production and operation of Shengbo optoelectronics. The company and Jinjiang Group will continue to actively perform the responsibilities of shareholders based on the principle of mutual benefit and win-win, and effectively improve the production technology, management level and profitability of Shengbo optoelectronics.

4、 Documents for reference

(2020) No. 452 award of Shenzhen International Arbitration Court

Board of directors of Shenzhen textile (Group) Co., Ltd

March 30, 2012