Jinlong Electromechanical: Subsidiary Xingke Electronics paid a settlement of US$2 million

July 19, 2022

Core Tip: Jinlong Electromechanical announced on July 18 that, according to the agreement that "within three months after the settlement agreement takes effect, Xingke Electronics will pay a settlement amount of 2 million US dollars", the wholly-owned subsidiary Xingke Electronics (Dongguan) Co., Ltd. "Xingke Electronics") has recently paid the other party a settlement amount of US$2 million.
On July 18, Jinlong Electromechanical announced that according to the agreement that "within three months after the settlement agreement takes effect, Xingke Electronics will pay a settlement amount of 2 million US dollars", the wholly-owned subsidiary Xingke Electronics (Dongguan) Co., Ltd. (hereinafter referred to as "Xingke Electronics") Electronic") has recently paid the other party a settlement payment of US$2 million.
The company previously disclosed that the judge in the U.S. Federal District Court for the Northern District of California in charge of reconciliation made the case against Sinco Electronics by SinCo Technologies Pte Ltd (referred to as "sinco") in the U.S. California Federal Court and the U.S. Santa Clara County Superior Court in California. To preside over and coordinate reconciliation matters between the plaintiff and the defendant in the litigation cases filed. On April 19, 2022, the management of the company signed a settlement agreement with sinco according to the deliberation results of the general meeting of shareholders. As of April 19, 2022, both the plaintiff and the defendant have signed the settlement agreement, which has come into effect. The settlement agreement signed by the two parties stipulates that Xingke Electronics shall pay the settlement amount of US$28 million to sinco for the settlement payment and payment arrangement.

At the same time, the payment arrangements for the settlement payment are as follows: (1) Within two working days after the settlement agreement takes effect, Xingke Electronics will issue an instruction to release the deposit to the third-party guarantee institution that issued a letter of guarantee of US$14.5 million for it. At the same time, sinco is obliged to request to revoke the jury verdict of the Federal Court of California in the United States within two working days after Xingke Electronics issues instructions to the third-party guarantee agency, and to request that the appeal case of the California Court of Appeals be dismissed without further action. The resuit dismissed the U.S. Trademark Trial and Appeal Board opposition proceedings. According to the above instructions, after receiving the joint confirmation letter from the plaintiff and the defendant, the third-party guarantee agency immediately released the security deposit of USD 14.5 million of Xinke Electronics and paid it to the designated payee of Sinco; (2) After the settlement agreement came into effect, the three Within the month, Xingke Electronics paid a settlement payment of US$2 million; (3) Within twelve months after the settlement agreement took effect, Xingke Electronics paid the remaining settlement payment of US$11.5 million.

On May 24, 2022, the attorney representing the corporate case received a decision from the U.S. Court of Appeals for the Sixth Circuit to dismiss the appeal of the federal court case. As confirmed by the attorney representing the case, as of May 24, 2022, sinco, as agreed in the settlement agreement, "requests to revoke the jury verdict of the Federal Court of California in the United States, to dismiss the appeal case of the California Court of Appeals without retrial, and to request the irrefutable rejection of the appeal. The U.S. Trademark Trial and Appeal Board Opposition Proceedings have been approved by the appropriate agencies. On June 2, 2022, local time in the United States (June 3, 2022, Beijing time), Xingke Electronics has completed the release of the security deposit of US$14.5 million as agreed in the settlement agreement, and has paid it to the other party.