JSC "Semipalatinsk Machine-Building Plant" | Information letter on the situation at JSC "Semipalatinsk Machine-Building Plant" (as of May 03, 2023)

JSC "NC" Kazakhstan Engineering "(hereinafter - the Company) in its activities adheres to a policy of openness and transparency, in connection with which it constantly informs about the current situation at JSC" Semipalatinsk Engineering Plant "(hereinafter - JSC "SMZ" / Plant ).

This information note is an addition to previously posted materials on the activities of SMZ JSC (available via the links):

Recall that SMZ JSC is not an enterprise related to the country's military-industrial complex , is not included in the register of domestic manufacturers of military goods (products), dual-use goods (products) (applications) and domestic suppliers of military works and military services appointment of the state defense order .

According to subparagraph 6) of Article 12 of the Law of the Republic of Kazakhstan “On Rehabilitation and Bankruptcy” (hereinafter referred to as the Law), for the period of the rehabilitation procedure and the bankruptcy procedure, all bodies of the debtor are removed from management and the rehabilitation manager acts as the sole management body of the debtor.

From the beginning of the rehabilitation procedure of SMZ JSC, the Company was removed from the management of the Plant, as it was not included in the Meeting and the Committee of Creditors of SMZ JSC, in order to prevent its bankruptcy.

Sanation

On March 31, 2023, a meeting of the Committee of Creditors of SMZ JSC was held, at which the Committee of Creditors decided to determine Oljakol LLP as a participant in the rehabilitation. The rehabilitation manager of SMZ JSC was instructed to sign the Sanitation Agreement with the sanitation participant, followed by its approval by the Creditors' Committee.

In accordance with paragraph 2 of Article 78 of the Law, a participant in the rehabilitation may assume an obligation to ensure that the claims of all creditors are satisfied within the time limits agreed with them. LLP "Oljakol" expressed such readiness and presented clear plans for the improvement of the Plant.

For reference: At the moment, the Plant has a debt to employees for January-April 2023 of more than 80 million tenge (the monthly wage fund of the Plant is about 20 million tenge).

At the meetings of the Meeting and the Committee of Creditors of SMZ JSC held on May 2, 2023, the Committee of Creditors approved the Agreement on the rehabilitation of JSC Semipalatinsk Machine-Building Plant (hereinafter referred to as the Agreement) concluded between the Plant and Oljakol LLP.

According to the Agreement, Oljakol LLP assumes all obligations to improve the financial and economic situation of the Plant, pay off its accounts payable and fulfill the Rehabilitation Plan of SMZ JSC.

In turn, on May 2, 2023, the Meeting of creditors of SMZ JSC decided to change the rehabilitation manager and transfer the right to manage the Plant to the rehabilitation participant represented by the director of Oljakol LLP Alibaev M.A.

Speaking at the Meeting of creditors, Alibaev M.A., said that it was planned to pay off the debt of SMZ JSC under the Rehabilitation Plan within 3.5 years. In the first calendar year, 350 million tenge will be repaid, in the second - 450 million tenge, in the third calendar year - 557 million tenge. Full repayment of wages is expected within 2-3 months of this year.

By virtue of paragraph 1 of Article 81 of the Law, a participant in the rehabilitation who has assumed the obligation provided for in paragraph 2 of Article 78 of the Law, and who is not the owner of the debtor's property, acquires the rights of a shareholder of a joint-stock company in the amount of funds invested by him on the basis of a joint-stock company adopted by the general meeting of shareholders before the start of rehabilitation solutions .

In this regard, the Company, as a shareholder owning all the voting shares of SMZ JSC in accordance with paragraph 1 of Article 81 of the Law, will, in the prescribed manner, submit to the authorized body the issue of exercising the rights of a shareholder of SMZ JSC in favor of Oljakol LLP in the account of the funds invested by him, in the event that the goal of rehabilitation is achieved by the latter.

SMZ JSC, in accordance with the established procedure, will send a package of documents on the reorganization of the Plant to the Specialized Interdistrict Economic Court for the East Kazakhstan Region for further approval.

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