China Merchants Securities Co.Ltd(600999)
About Ningbo Jialian Technology Co., Ltd
The verification opinions China Merchants Securities Co.Ltd(600999) (hereinafter referred to as the “sponsor”) on using some idle raised funds to temporarily supplement working capital as the sponsor of Ningbo Jialian Technology Co., Ltd. (hereinafter referred to as “Jialian technology” and “the company”) for initial public offering of shares and listing on the gem, in accordance with the administrative measures for securities issuance and listing sponsor business Relevant provisions such as the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies, the guidelines for the information disclosure of listed companies of Shenzhen Stock Exchange No. 6 – recommendation business, the Listing Rules of GEM stocks of Shenzhen Stock Exchange and the guidelines for the standardized operation of GEM listed companies of Shenzhen Stock Exchange, The matters that Jialian technology plans to use some idle raised funds to supplement working capital temporarily have been carefully verified, and the specific conditions are as follows:
1、 Basic information of raised funds
According to the reply on Approving the registration of initial public offering of Ningbo Jialian Technology Co., Ltd. (zjxk [2021] No. 3103) issued by China Securities Regulatory Commission and the notice on the listing of RMB common shares of Ningbo Jialian Technology Co., Ltd. on the gem (SZS [2021] No. 1241) issued by Shenzhen stock exchange, Jialian Technology issued 30000000 ordinary shares (A shares) to the public for the first time, with an issue price of 30.73 yuan per share. The total amount of funds raised was 921900000.00 yuan. After deducting the issuance expenses excluding tax of 93730018.80 yuan, the net amount of funds actually raised was 828169981.20 yuan. Tianzhi International Certified Public Accountants (special general partnership) verified the capital availability of the company’s initial public offering of shares, and issued the capital verification report (Tianzhi Zi [2021] No. 44951) on December 6, 2021. The company carried out special account storage and management of the raised funds in accordance with the regulations, deposited all the raised funds in the special account for raised funds after they were received, and signed the tripartite supervision agreement for raised funds with the sponsor and the commercial bank storing the raised funds.
2、 Investment projects with raised funds
According to the prospectus of Ningbo Jialian Technology Co., Ltd. on initial public offering and listing on GEM, the investment projects and use plans of the funds raised by the company’s public offering are as follows:
The total investment of the project is planned to use the raised funds. As of December 2021, No. project content amount (10000 yuan) fund investment amount (10000 yuan has been invested in the raised funds on December 31) Fund (10000 yuan)
Research and development of biodegradable materials and products
1 core construction project 10023.00 10023.00 0.00
Biodegradable materials and products in Shupu plant
2 and high-end plastic products production line construction 26604.00 26604.00 196.35 project
3 supplementary working capital 10000.00 10000.00 5576.12
Total 46627.00 5772.47
3、 Temporary replenishment of working capital with idle raised funds this time
(I) idle conditions and reasons
The company will invest step by step according to the construction progress and capital investment plan of the raised investment project. Since the project construction requires a certain period, in order to improve the use efficiency of the raised funds, meet the needs of the company’s production and operation for daily working capital, and maximize the interests of the company’s shareholders, on the premise of ensuring the use demand of the funds of the raised investment project, The company plans to use some idle raised funds to supplement working capital temporarily.
(II) amount and period of idle raised funds to temporarily supplement working capital
With the continuous expansion of the company’s business scale, the company needs to increase investment and the demand for working capital is also increasing. In order to fully guarantee the production and operation of the company, improve the use efficiency of idle raised funds and reduce financial costs, on the premise of ensuring the capital demand for the construction of raised funds investment projects and the normal progress of raised funds investment projects, According to the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies and the company’s raised funds management system, the company plans to use idle raised funds of no more than 200 million yuan to temporarily supplement working capital, and the service life shall not exceed 12 months from the date of deliberation and approval by the board of directors, When due, it will be returned to the special account for raised funds of the company.
(III) rationality and necessity of temporarily replenishing working capital with some idle raised funds this time
The use of idle raised funds to temporarily supplement working capital is conducive to meeting the company’s daily business needs, alleviating the demand pressure of working capital, improving the company’s development speed, improving the use efficiency of raised funds and reducing financial costs.
By temporarily replenishing working capital with some idle raised funds this time, it is estimated that the company can save up to 7.4 million yuan / year of financial expenses (calculated according to the benchmark interest rate of one-year loan published by the people’s Bank of China, which is only the calculation data), which can solve the temporary demand for working capital, give full play to the use efficiency of raised funds and reduce financial expenses, In line with the interests of the company and all shareholders.
If the use progress of the raised funds is accelerated due to the needs of the investment projects with raised funds, the company will return them in advance in time to ensure the normal operation of the investment projects with raised funds.
4、 Relevant instructions on temporarily replenishing working capital with idle raised funds
1. The company will timely return the funds to the special account for raised funds before the expiration of the current replenishment of working capital;
2. The use of some idle raised funds to temporarily supplement working capital will not change or change the purpose of raised funds in a disguised form;
3. The use of some idle raised funds to temporarily supplement working capital will not affect the normal operation of the investment projects with raised funds; If the investment project of raised funds needs to be used due to the implementation progress, the company will return the funds to the special account of raised funds in time to ensure the normal operation of the investment project of raised funds;
4. The use of some idle raised funds to temporarily supplement working capital is limited to the production and operation related to the main business, and will not directly or indirectly use the idle raised funds for high-risk investments such as securities investment and derivatives trading.
5、 Review procedure
On January 27, 2022, the company held the second interim meeting of the board of directors and the fifth meeting of the second board of supervisors in 2022, deliberated and approved the proposal on using some idle raised funds to temporarily supplement working capital, and agreed that the company should use idle raised funds of no more than 200 million yuan to temporarily supplement working capital, All independent directors of the company have expressed their independent opinions on this proposal.
6、 Verification opinions of the recommendation institution
After verification, the recommendation institution believes that:
Jialian technology has used some idle raised funds to temporarily supplement working capital, which has been deliberated and approved by the board of directors and the board of supervisors of the company. All independent directors of the company have expressed their independent opinions, and the decision-making procedures are legal and compliant, Comply with the provisions of relevant laws and regulations such as the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies, the Listing Rules of GEM stocks of Shenzhen Stock Exchange and so on. The company’s use of idle raised funds of no more than 200 million yuan to temporarily supplement working capital is limited to the production and operation related to its main business, and is not directly or indirectly used for the placement and purchase of new shares, or for the trading of stocks and their derivatives, convertible corporate bonds, etc. The use plan will not affect the normal progress of the investment projects of the raised funds, help to improve the use efficiency of funds, save financial expenses, alleviate the demand for working capital for business growth, and there is no situation of changing the purpose of the raised funds in a disguised manner and damaging the interests of shareholders.
In conclusion, the sponsor has no objection to Jialian technology’s use of some idle raised funds to temporarily supplement working capital.
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