Item 1. Legal Proceedings
Item 1. Legal Proceedings
On or about August 3, 2018, written decisions
of administration penalty captioned Shou Guo Tu Zi Fa Gao Zi [2018] No. 291, Shou Guo Tu Zi Fa Gao Zi [2018] No. 292, Shou Guo Tu Zi Fa
Gao Zi [2018] No. 293, Shou Guo Tu Zi Fa Gao Zi [2018] No. 294, Shou Guo Tu Zi Fa Gao Zi [2018] No. 295 and Shou Guo Tu Zi Fa Gao Zi [2018]
No. 296 (together, the “Written Decisions”) were served on Shouguang City Haoyuan Chemical Company Limited (“SCHC”)
by the Shouguang City Natural Resources and Planning Bureau (the “Bureau”), naming SCHC as respondent.
For more details and information related to the
Written Decisions, please see “Note 20 – Loss Contingencies, Notes to Condensed Consolidated Financial Statement” contained
in this quarterly report.
According to a Civil Mediation Statement (No.
(2025) Lu 0783 Min Chu 2607) issued by the Shouguang People's Court of Shandong Province on March 17, 2025, Shouguang City Haoyuan Chemical
Company Limited ("SCHC"), a wholly owned subsidiary of the Company, owes the plaintiff, Shouguang Chengyu Trading Co., Ltd.,
a total of RMB 226,825.44 for goods. SCHC is also obligated to make monthly payments of RMB 50,000 to the plaintiff by the 15th of each
month, starting in April 2025, until the debt is fully paid off.
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