Securities code: 002602 securities abbreviation: Zhejiang Century Huatong Group Co.Ltd(002602) Announcement No.: 2022-002 Zhejiang Century Huatong Group Co.Ltd(002602)
Proposal on repurchasing shares of the company
The company and all members of the board of directors guarantee that the information disclosed is true, accurate and complete without false records, misleading statements or major omissions.
Important content tips:
1. Zhejiang Century Huatong Group Co.Ltd(002602) (hereinafter referred to as “the company”) plans to use its own funds or self raised funds to buy back the company’s shares in the form of centralized bidding transaction for the later implementation of equity incentive plan, employee stock ownership plan or reduction of registered capital. The total amount of repurchase funds shall not be less than 500 million yuan, not more than 1 billion yuan, the repurchase price shall not exceed 10 yuan / share, and the period of share repurchase shall be 12 months from the date when the general meeting of shareholders deliberates and approves the share repurchase plan. Under the above conditions, according to the calculation of the upper limit of repurchase amount and repurchase price, the number of shares repurchased is expected to be about 100000000, accounting for about 1.34% of the total share capital of the company; According to the calculation of the lower limit of the repurchase amount and the upper limit of the repurchase price, the number of shares repurchased is expected to be about 50000000, accounting for about 0.67% of the total share capital of the company. The specific number of shares repurchased is subject to the actual number of shares repurchased at the expiration of the repurchase period.
2. Relevant risk tips: there is a risk that the company’s general meeting of shareholders did not consider and approve the proposal of share repurchase in this repurchase; There is a risk that the stock price continues to exceed the upper limit of the repurchase price during the repurchase period, resulting in the failure of the smooth implementation of the repurchase plan; There may be a risk that the repurchased shares cannot be fully granted due to the failure of the equity incentive plan or employee stock ownership plan to be deliberated and approved by the decision-making bodies such as the company’s board of directors and the general meeting of shareholders, and the incentive objects give up the subscription of shares.
1、 Main contents of repurchase plan
(I) purpose of share repurchase
Based on the confidence in the company’s future development prospects and the high recognition of the company’s value, in order to safeguard the interests of the majority of investors, enhance investor confidence, effectively improve the investment return of the company’s shareholders, improve the company’s long-term incentive mechanism, fully mobilize the enthusiasm of the company’s managers and core backbone, and improve the team cohesion and competitiveness, Effectively promote the long-term development of the company. The company plans to use its own funds or self raised funds to repurchase the company’s shares in the form of centralized bidding. The company’s shares repurchased are intended to be used for equity incentive plan, employee stock ownership plan or reduce the registered capital.
(II) the repurchased shares meet the relevant conditions
This repurchase meets the conditions specified in Article 10 of the guidelines for self discipline supervision of listed companies of Shenzhen Stock Exchange No. 9 – share repurchase (SZS [2022] No. 21):
1. The company’s shares have been listed for one year;
2. The company has no major illegal acts in the last year;
3. After the share repurchase, the listed company has the ability of debt performance and sustainable operation;
4. After repurchasing shares, the equity distribution of the listed company shall, in principle, meet the listing conditions; If the company intends to terminate the listing and trading of its shares by repurchasing shares, it shall comply with the relevant provisions and consent of the stock exchange;
5. Other conditions stipulated by the CSRC and the stock exchange.
(III) method and price range of shares to be repurchased
1. The company plans to repurchase through the centralized bidding transaction of Shenzhen Securities Exchange.
2. Combined with the current financial and operating conditions of the company, it is determined that the repurchase price of the company does not exceed 10 yuan / share, and does not exceed 150% of the average stock transaction price in the 30 trading days before the board of directors adopts the share repurchase resolution. The specific repurchase price shall be authorized by the board of directors to integrate the stock price of the company’s secondary market during the implementation of the repurchase The company’s financial and operating conditions are determined.
During the period of share repurchase, dividend distribution and other matters, such as the stock price limit of the company’s share repurchase and dividend distribution shall be adjusted according to the provisions of the CSRC, and the stock price of the company’s capital stock shall be adjusted from the date of the implementation of dividend distribution and dividend distribution according to the provisions of the CSRC.
(IV) the type, purpose and quantity of shares to be repurchased, the proportion in the total share capital of the company and the total amount of funds to be repurchased
1. Types of shares to be repurchased
RMB ordinary shares (A shares) issued by the company.
2. Purpose of shares to be repurchased
The shares to be repurchased this time will be used to implement the equity incentive plan, employee stock ownership plan or reduce the registered capital. 3. The number of shares to be repurchased, the proportion in the total share capital of the company and the total amount of funds to be used for repurchases
The total amount of this repurchase shall be no less than RMB 500 million and no more than RMB 1 billion. If calculated according to the upper limit of repurchase amount and repurchase price, the number of repurchased shares is expected to be about 100000000 shares, accounting for about 1.34% of the total share capital of the company; According to the calculation of the lower limit of repurchase amount and the upper limit of repurchase price, the number of shares repurchased is expected to be about 50000000, accounting for about 0.67% of the total share capital of the company. The specific number of shares repurchased shall be subject to the actual number of shares repurchased at the completion of repurchase.
During the repurchase period, if the company implements dividend distribution, share distribution, conversion of capital reserve into share capital, stock subdivision, stock reduction, share allotment and other ex rights and ex interests, the number of repurchased shares shall be adjusted accordingly in accordance with the relevant provisions of the CSRC and Shenzhen Stock Exchange from the date of ex rights and ex interests of the share price.
(V) source of funds for share repurchase
The capital source of this share repurchase is the company’s own funds or self raised funds.
(VI) implementation period of share repurchase
The implementation period of this share repurchase is within 12 months from the date of deliberation and approval by the general meeting of shareholders. During the implementation of the repurchase plan, if the trading of the company’s shares has been suspended for more than 10 consecutive trading days due to the planning of major events, the repurchase period may be postponed, and the postponed period shall not exceed the maximum period specified by the CSRC and the Shenzhen Stock Exchange.
1. If the following conditions are met, the repurchase period will expire in advance:
(1) If the use amount of repurchase funds reaches the maximum within the repurchase period, the repurchase plan will be implemented immediately, and the repurchase period will expire in advance from that date.
(2) If the board of directors of the company decides to terminate the repurchase plan, the repurchase period shall expire in advance from the date when the board of directors decides to terminate the repurchase plan.
According to the authorization of the general meeting of shareholders, the board of directors of the company will choose the opportunity to make the repurchase decision according to the market conditions within the repurchase period and implement it according to law.
2. The company shall not repurchase its shares within the following periods:
(1) Within ten trading days before the announcement of the listed company’s annual report, semi annual report, quarterly report, performance forecast or performance express;
(2) From the date of occurrence of major events that may have a significant impact on the trading price of the company’s shares or during the decision-making process to the date of disclosure according to law;
(3) Other circumstances stipulated by the CSRC.
(VII) expected changes in the company’s share capital structure after repurchase
1. According to the upper limit of the repurchase amount and the repurchase price, the number of repurchases is expected to be about 100000000 shares, accounting for about 1.34% of the company’s total share capital. Assuming that all the repurchased shares are used in the equity incentive plan and employee stock ownership plan, the changes in the company’s share capital structure after the repurchase are expected to be as follows:
Before and after share repurchase
Proportion of quantity (shares) to total share capital proportion of quantity (shares) to total share capital
Shares with limited sales conditions 2193216724 29.43% 2293216724 30.77%
Shares without sale conditions 5259340244 70.57% 5159340244 69.23%
Total share capital 7452556968 100.00%
2. According to the lower limit of the repurchase amount and the upper limit of the repurchase price, the number of repurchases is expected to be about 50000000 shares, accounting for about 0.67% of the total share capital of the company. Assuming that all the repurchased shares are used in the equity incentive plan and employee stock ownership plan, the changes in the capital structure of the company after the repurchase are expected to be as follows:
Before and after share repurchase
Proportion of quantity (shares) to total share capital proportion of quantity (shares) to total share capital
Shares with limited sales conditions 2193216724 29.43% 2243216724 30.10%
Shares without sale conditions 5259340244 70.57% 5209340244 69.90%
Total share capital 7452556968 100.00%
(VIII) the management’s analysis on the impact of this share repurchase on the company’s operation, finance, R & D, debt performance ability, future development and maintaining the listing status, and all directors’ commitment that this share repurchase will not damage the debt performance ability and sustainable operation ability of the listed company
1. The impact of this share repurchase on the company’s operation, finance, R & D and debt performance
As of September 30, 2021, the total assets of the company are 40254661440.21 yuan, the owner’s equity attributable to the shareholders of the listed company is 315669597998.27 yuan, the current assets are 9899766108.33 yuan, the liabilities are 8023702728.16 yuan, and the monetary capital is 3049007738.55 yuan (the above data are Unaudited).
The upper limit of the total repurchase funds is RMB 1 billion, accounting for 2.48%, 3.17% and 10.10% of the total assets of the company, the owner’s equity attributable to the shareholders of the listed company and the current assets respectively. According to the company’s operation, finance and future development, the company believes that even if the repurchase is carried out with the upper limit of RMB 1 billion, it will not have a significant impact on the company’s operation, finance, R & D and future development.
All directors promise that this share repurchase will not damage the debt performance ability and sustainable operation ability of the listed company.
2. Impact of this share repurchase on the future development of the company
The implementation of this share repurchase is conducive to protecting the interests of investors, enhancing investors’ confidence in the company, consolidating the company’s image in the capital market, stabilizing the company’s talent team and having a positive impact on the company’s long-term development.
3. Analysis on whether the repurchase of shares affects the status of listed companies
After the completion of this repurchase, the company’s equity structure will not change significantly, which will not lead to the company’s equity distribution not meeting the company’s listing conditions, nor will it change the company’s status as a listed company.
(IX) the situation of the company’s directors, supervisors, senior managers, controlling shareholders, actual controllers and persons acting in concert buying and selling the company’s shares within six months before the board of directors makes the share repurchase resolution, whether there is an explanation of insider trading and market manipulation alone or jointly with others, and the plan for increase or decrease of shares during the repurchase period
Ms. Yang Bo, an independent director of the company, personally bought 91000 shares of the company’s shares from November 17, 2021 to January 13, 2022, and sold 83100 shares on January 21, 2022. The above behavior constituted a short-term transaction and generated a total income of RMB 21529.
This illegal transaction is an independent investment behavior made by Ms. Yang Bo’s relatives according to the judgment of the secondary market. Ms. Yang Bo is not aware of the transaction. Before and after the transaction, Ms. Yang Bo did not inform her relatives about the operation of the company and other relevant information. Her relatives did not consult Ms. Yang Bo on the purchase and sale of shares. Her purchase and sale of shares of the company are all personal operations, There is no purpose of using short-term trading or insider trading to seek benefits, and there is no subjective violation. Ms. Yang Bo and her relatives have deeply realized the seriousness of this matter, sincerely apologized for the adverse impact caused by short-term transactions, and turned over all the proceeds to the company. The above matters were reported on cninfo.com on January 29, 2022（ http://www.cn.info.com.cn. ）Disclose the announcement on short-term trading and apology of relatives of independent directors (Announcement No.: 2022-001). In addition to the above matters, the company’s directors, supervisors, senior managers, controlling shareholders, actual controllers and persons acting in concert did not buy or sell the company’s shares six months before the board of directors made the share repurchase resolution, nor did they conduct insider trading and manipulate the market alone or jointly with others.
At present, the company’s directors, supervisors, senior managers, controlling shareholders, actual controllers and persons acting in concert have no clear plan to increase or decrease their holdings. If the share increase or decrease plan is to be implemented in the future, the company will timely perform the obligation of information disclosure in accordance with relevant regulations.
(x) relevant arrangements for cancellation or transfer according to law after share repurchase, as well as relevant arrangements for preventing infringement on the interests of creditors
The shares repurchased this time will be used for equity incentive plan, employee stock ownership plan or reduction of registered capital. If the company fails to implement the above purpose within the period specified by relevant laws and regulations after the completion of share repurchase, or the repurchased shares are not fully used for the above purpose, the unused part will be cancelled according to law, and the company will start the procedure of separate disposal. If the company cancels the repurchased shares, the company will timely perform relevant decision-making procedures and notify all creditors in accordance with the company law and other relevant provisions, so as to fully protect the legitimate rights and interests of creditors. 2、 Deliberation of the board of directors and relevant authorization
In accordance with the company law, the securities law, the share repurchase rules of listed companies and the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 9 – share repurchase and other relevant provisions, the company held the fifth meeting of the Fifth Board of directors and the fifth meeting of the Fifth Board of supervisors on February 11, 2022, and deliberated and adopted the proposal on share repurchase plan of the company, The independent directors expressed their independent opinions on the repurchase. The share repurchase plan needs to be submitted to the general meeting of shareholders of the company for deliberation.
In order to ensure the smooth implementation of this share repurchase, the board of directors of the company will request the general meeting of shareholders to authorize the board of directors of the company and the authorized persons of the board of directors to review and approve it within the scope of laws and regulations
