Securities code: 600237 Securities abbreviation: Tongfeng Electronic Number: Lin 2022-020
Anhui Copper Feng Electronic Co., Ltd. on the holding Sun Company involved in litigation matters progress announcement

The board of directors and all the directors of the Company warrant that there is no false record, misleading statement or material omission in the content of this announcement, and bear individual and joint liability for the authenticity, accuracy and completeness of the content.

Important content Tips:
● The stage at which the case is litigious: resue.
● The plaintiff is the company holding Sun Company Tongling Tongfeng Precision Technology Co., LTD
● Amount involved in the lawsuit: RMB 19.258,800
● Whether it will have a negative impact on the company's profit and loss: After the lawsuit was filed, the lawsuit was dismissed due to the need to supplement and review other relevant matters. At present, the completion of the supplementary review matters, Tongling Tongfeng Precision Technology Co., Ltd. has filed a lawsuit again. The company has made an impairment reserve for the relevant funds in the early stage, and the case will not have a negative impact on the company's current or post-period profit and loss.
In August 2020, Anhui Tongfeng Electronics Co., LTD. (hereinafter referred to as the "Company") held the Sun Company, Tongling Tongfeng Precision Technology Co., LTD. (hereinafter referred to as "Tongfeng Precision"), on the ground that the shareholder Kunshan Longmeng Electronic Technology Co., LTD. (hereinafter referred to as "Longmeng Electronics") had harmed the interests of the company. To file a civil lawsuit with Tongguan District People's Court of Tongling City (hereinafter referred to as "Tongguan District Court"). The progress of the case is announced as follows:
I. Introduction to the background of this lawsuit
On July 3, 2019, in order to further expand the business scale, Tongfeng Precision introduced its shareholder Longmeng Electronics in the way of capital increase and share increase. Longmeng Electronics invested 15 million yuan with fixed assets and acquired 27.72% of the equity after the capital increase. Upon completion of the above capital increase, the Company indirectly holds 61.74% of the equity of Copper Feng Precision (see the Company's announcements published in designated information disclosure media on March 11, 2017 and July 4, 2019 for details). According to the Cooperation Agreement signed between Tongfeng Precision and Longmeng Electronics, upon completion of the above capital increase, the customer relationship of Longmeng Electronics will be gradually transferred to Tongfeng Precision. In the process of customer relationship transfer, in order to ensure the continuous stability of customer orders, in September 2019, after deliberation and approval by the sixth meeting of the eighth Board of Directors of the company, Tongfeng Precision decided to continue to entrust Longmeng Electronics to supply goods to the original customers (for details, please see the company's announcement published in the designated information disclosure media on September 18, 2019). Later, due to the fact that the proceeds of Longmeng Electronic sales were not fully refunded to Tongfeng Precision, the accumulated debt reached 19 million yuan by July 31, 2020, and the amount due was 17.030,800 yuan. In August 2020, Tongfeng Precision filed a lawsuit with Tongguanshan District Court of Tongling City (hereinafter referred to as "Tongguanshan District Court") on the grounds that Longmeng Electronics harmed the interests of the company, requiring it to pay back the arrears and apply for legal preservation. Request to seal up and freeze the capital property of Longmeng Electronics' investment of 15 million shares in Tongfeng Precision (see the company's announcement published in designated information disclosure media on December 9, 2020 for details).
Ii. Progress of the litigation matters
During the trial, Longmeng Electronics filed a defense with the Tongguan District Court, alleging that Tongfeng had committed tax violations in selling its products. On July 16, 2021, Tongguan District Court concluded after examination that the plaintiff Tongfeng Precision was suspected of falsely writing VAT invoices in the process of selling products to the defendant Longmeng Electronics, which should be investigated and dealt with by the public security organs before claiming rights. The plaintiff's lawsuit response should be rejected, and issued a civil decision No. 4271 (2020) Wan 0705 in the Early Republic of China. Ruled to reject the plaintiff Tongfeng Precision's suit, the case clues transferred to the Tongling City Tax Bureau Inspection Bureau. Recently, Tongfeng Precision received Tongling City tax Bureau inspection Bureau issued the copper tax audit (2022) No. 3 administrative penalty decision, identified Tongfeng precision in January 2018, in the absence of actual sales of goods, for Longmeng electronic issued a special VAT invoice, involving the amount of 69200 yuan, 117,600 yuan tax, decided to fine 50,000 yuan on the above behavior.
In view of the completion of relevant matters, on April 1, 2022, Tongfeng Precision submitted materials to Tongguan District Court and filed a civil lawsuit again, requiring Longmeng Electronics and relevant parties to return the arrears of RMB 19,258,800.
Iii. Description of relevant matters and the impact of litigation matters on the Company's current and subsequent profits
The tax-related matters discovered during the examination of this case occurred in January 2018. At that time, the original controlling shareholder and actual controller of the company were deeply in debt crisis, which had an indirect impact on the listed company and resulted in the failure to realize effective supervision and control over the operation and management of the overseas offices. Since the change of the company's control in October 2020, the new management team has comprehensively strengthened the internal governance and taken effective measures to continuously improve the internal control system. In the future, the Company will continue to strengthen the effective management of the operation of the company and its subsidiaries, enhance risk awareness, develop preventive measures, and effectively safeguard the interests of the company and shareholders.
The company has made provision for impairment of relevant funds in the early stage, and this litigation matter will not have a material adverse impact on the company's operation, nor will it have a negative impact on the company's current and future profit and loss. The board of directors of the company will pay close attention to and attach great importance to this matter, and timely disclose the progress of the case in accordance with relevant regulations in accordance with the law. Meanwhile, investors should pay attention to the investment risk.
This is to announce.