Nanfang (600250): Progress Of Performance Compensation Related Matters

Nanfang (600250) announced on the evening of May 30, which was approved by China Securities Regulatory Commission on the approval of Nanjing Textile Import and Export Co., Ltd. issuing shares to Nanjing Confucius Temple Cultural Tourism Group Co., Ltd. to purchase assets and raise matching funds (zjxk [2019] No. 2487), Nanjing Textile Import and Export Co., Ltd. (hereinafter referred to as Nanfang Co., Ltd., the company and the listed company) issued 37816912 shares to Nanjing Confucius Temple Cultural Tourism Group Co., Ltd. (hereinafter referred to as Confucius Temple Cultural Tourism) to purchase 51% equity of Nanjing Qinhuai Scenery Tourism Co., Ltd. (hereinafter referred to as Qinhuai scenery), and made performance gambling arrangements. In 2021, qinhuaifeng failed to fulfill its performance commitment. According to the relevant provisions of the profit forecast compensation agreement and the supplementary agreement on issues related to the purchase of assets by issuing shares (II), the company signed with Confucius Temple Cultural Tourism, The commitment party, Confucius Temple Cultural Tourism, shall remit the cash compensation of RMB 7.9552 million to the bank account designated by Nanfang Co., Ltd. within 30 days (before May 29, 2022) of the "special audit report on the actual profit and the completion of the committed profit of Nanjing Qinhuai Scenery Tourism Co., Ltd. (daxstsz [2022] No. 23-00086), For details, please refer to the announcement on the completion of 2021 performance commitment and related matters of Nanjing Qinhuai Scenery Tourism Co., Ltd. disclosed by the company on April 30, 2022.

On March 7, 2022 and April 26, 2022, the company has sent to Confucius Temple Culture and Tourism Group Co., Ltd. "letter on prompting performance compensation clauses triggered by Qinhuai scenery may not be able to achieve its commitment" and "letter on urging Nanjing Confucius Temple Cultural Tourism Group Co., Ltd. to fulfill performance compensation obligations" to remind and urge Confucius Temple Cultural Tourism to fulfill its industry performance compensation obligations. On April 27, 2022, the company received a reply from Confucius Temple Culture and tourism, believing that the failure of Qinhuai scenery to achieve the promised performance was caused by the epidemic situation, and the epidemic situation factor was force majeure, which was a statutory provision in the contract law that the relevant parties could not perform the relevant contractual obligations; Confucius Temple Culture and tourism does not violate the "profit forecast compensation agreement" and "supplementary agreement on matters related to the issue of shares to purchase assets (II)", and there is no need for performance compensation.

As of May 29, 2022, the company has not received the performance compensation due from Confucius Temple Cultural Tourism. In order to safeguard the interests of the listed company and all shareholders, the company has entrusted Shanghai jintiancheng (Nanjing) law firm to send a lawyer's letter to Confucius Temple Culture and tourism on May 30, 2022, urging the Confucius Temple Culture and tourism to fulfill the industry performance compensation obligations.

The company will closely track the progress of performance compensation. If the Confucius Temple Cultural Tourism still refuses to make compensation, the company will take effective legal measures including but not limited to bringing a lawsuit to the court in accordance with the law to safeguard its legitimate rights and interests, and timely fulfill the obligation of information disclosure according to the progress of the matter.