China Securities Co.Ltd(601066)
about
Sec Electric Machinery Co.Ltd(603988)
Termination of major asset restructuring
of
Verification opinions of independent financial advisor
Independent financial advisor
February, 2002
Sec Electric Machinery Co.Ltd(603988) (hereinafter referred to as ” Sec Electric Machinery Co.Ltd(603988) ” or “listed company”) plans to purchase all the equity held by all shareholders of Tianjin Beiqing power smart energy Co., Ltd. by means of asset replacement and share issuance, and plans to raise supporting funds by non-public offering of shares to no more than 35 qualified specific investors (hereinafter referred to as “this transaction” or “this reorganization”). China Securities Co.Ltd(601066) (hereinafter referred to as “the independent financial adviser”) as the independent financial adviser of Sec Electric Machinery Co.Ltd(603988) this reorganization, carefully checked the process and termination reasons of this reorganization in accordance with relevant regulations, and issued the independent financial adviser’s verification opinions (hereinafter referred to as “the verification opinions”) according to the relevant conditions confirmed by verification as follows: I. Basic information of this major asset reorganization
The listed company plans to purchase all the equity held by all shareholders of Tianjin Beiqing power smart energy Co., Ltd. (hereinafter referred to as the “target company”) by means of asset replacement and share issuance, and plans to raise supporting funds by non-public offering of shares to no more than 35 qualified specific investors. This transaction is expected to constitute the reorganization and listing stipulated in the measures for the administration of major asset reorganization of listed companies of the CSRC, and lead to the change of the control right of the listed company. After the completion of this transaction, Beijing SASAC will become the actual controller of the listed company, and Tianjin Fuqing Investment Co., Ltd. will become the controlling shareholder of the listed company. For details, see relevant announcements such as the report on Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions (Draft) published by the listed company in Shanghai Securities News and the website of Shanghai Stock Exchange on September 25, 2021. 2、 Main work done by the company during the period of promoting major asset restructuring
During the period of planning and promoting this major asset reorganization, the listed company and relevant parties actively promote the relevant work of this major asset reorganization in strict accordance with the provisions of the administrative measures for major asset reorganization of listed companies and other relevant laws, administrative regulations and normative documents:
1. The listed company demonstrated the major asset restructuring plan, communicated with the counterparty to form a preliminary plan, and signed a confidentiality agreement with relevant parties.
2. The listed company prepared the plan for this reorganization in accordance with the requirements of laws, regulations and normative documents related to major asset reorganization, and hired independent financial advisers, legal advisers, audit, evaluation and other intermediaries for this transaction.
3. Due to the planning of this reorganization, the trading of the shares of the listed company has been suspended since the opening of the market on March 15, 2021 after applying to the Shanghai Stock Exchange. For details, see the announcement on suspension of Sec Electric Machinery Co.Ltd(603988) major asset reorganization disclosed by the listed company (Announcement No.: Pro 2021-004).
4. On March 26, 2021, the listed company held the 10th meeting of the 4th board of directors, deliberated and approved the proposal on the company’s major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions one by one, and other proposals related to this transaction, For details, see the relevant announcement disclosed by the listed company on March 27, 2021 and the plan for Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions. Upon application to the Shanghai Stock Exchange, the trading of the shares of the listed company will resume from the opening of the market on March 29, 2021.
5. On April 2, 2021, the listed company received the information disclosure inquiry letter on the plan for Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions issued by Shanghai Stock Exchange (SSE Gong Han [2021] No. 0297). On June 18, 2021, the listed company disclosed the reply announcement of Sec Electric Machinery Co.Ltd(603988) on the information disclosure inquiry letter of Shanghai Stock Exchange on Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions (Announcement No.: pro 2021-044).
6. On June 20, 2021, the listed company received the second inquiry letter on information disclosure of Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions plan issued by Shanghai Stock Exchange (szgh [2021] No. 0636). On August 6, 2021, the listed company disclosed the reply announcement of Sec Electric Machinery Co.Ltd(603988) on Shanghai Stock Exchange’s second inquiry letter on information disclosure of Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions plan (Announcement No.: pro 2021-057).
7. On September 23, 2021, the listed company held the 14th meeting of the Fourth Board of directors, deliberated and approved the proposal on the company’s major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions one by one, and other proposals related to this transaction, For details, see the report on Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets and raise supporting funds and related party transactions (Draft) and relevant announcements disclosed by the listed company in Shanghai Securities News and the website of Shanghai Stock Exchange on September 25, 2021. For the full text, see the website of Shanghai Stock Exchange.
8. On December 3, 2021, the listed company disclosed the announcement of Sec Electric Machinery Co.Ltd(603988) on the extension of the first extraordinary general meeting of shareholders in 2021 (Announcement No.: 2021-076), because this transaction involves the spin off of Beikong Clean Energy Group Co., Ltd. (01250. HK, hereinafter referred to as “Beikong clean energy group”), a listed company of the stock exchange of Hong Kong Limited, In accordance with the relevant laws and regulations of Hong Kong and the relevant provisions of the articles of association of Beikong clean energy group, the board of directors of the listed company decided to hold the 2021 meeting originally scheduled for December 10, 2021
The first extraordinary general meeting of shareholders in was postponed to March 8, 2022.
9. On January 26, 2022, the listed company disclosed the announcement on the progress of restructuring transactions involving spin off approval (Announcement No.: p.2022-001), which announced that Beikong clean energy group failed to obtain the approval of the Hong Kong Stock Exchange on the spin off, which would lead to the failure to reach the preconditions of this transaction and the risk of termination of this transaction; According to the approval of the spin off application, the listed company will actively negotiate with all parties to the transaction, perform relevant approval procedures and timely disclose information in accordance with the provisions of relevant laws and regulations.
10. On February 18, 2022, the listed company disclosed the Sec Electric Machinery Co.Ltd(603988) suggestive announcement on the planned termination of major asset restructuring (Announcement No.: pro 2022-007).
As of the date of issuance of this verification opinion, the listed company has performed relevant decision-making procedures, timely disclosed relevant information, and reminded the majority of investors of the uncertainty risk of this major asset restructuring in accordance with the relevant provisions of laws, regulations and normative documents such as the measures for the administration of major asset restructuring of listed companies. 3、 Reasons for terminating this major asset restructuring
Since the preparation of this major asset restructuring, the listed company has actively organized relevant parties to promote this transaction in strict accordance with the requirements of relevant laws and regulations. This transaction involves the spin off of Beikong clean energy group, a company listed on the Hong Kong stock exchange. In accordance with the application guidelines of item 15 of the rules governing the listing of securities on the stock exchange of Hong Kong Limited (hereinafter referred to as “pn15”) and the relevant laws and regulations of Hong Kong, Beikong clean energy group needs to obtain the approval of the stock exchange of Hong Kong for the spin off under pn15 (hereinafter referred to as “this spin off”), And obtain its consent to exempt Beikong clean energy group from the applicable provisions of guaranteed quota under pn15.
On January 21, 2022, Beikong clean energy group received an email from the stock exchange of Hong Kong, believing that Beikong clean energy group did not comply with the relevant provisions on asset spin off and listing in the Securities Listing Rules of the stock exchange of Hong Kong Limited. This email does not constitute a formal decision under the Listing Rules of the stock exchange of Hong Kong.
On January 25, 2022, the listed company received the notification letter from the target company, It informs: “After discussing with the relevant intermediaries of the pn15 spin off, it is believed that according to the written reply of the Hong Kong Stock Exchange and the general audit habits of the Hong Kong stock exchange, in case of non-compliance with the relevant rules, the written reply of the Hong Kong Stock Exchange will be deemed that the spin off has not been approved, and the Hong Kong Stock Exchange will not make further reply / reply to the approval opinions.”
In view of the fact that the examination and approval results of pn15 spin off directly affect the progress of major asset restructuring of listed companies, on February 10, 2022, the listed company sent an inquiry letter to the target company, asking the target company to introduce in detail the specific process of examination and communication between Beikong clean energy group and the Hong Kong Stock Exchange on the examination and approval of pn15 spin off and the plan and arrangement of follow-up communication, Specify the specific reasons for Beikong clean energy group’s non-compliance with the asset spin off rules of the Hong Kong stock exchange, and explain the plan for the follow-up work of this major asset restructuring.
On February 16, 2022, the listed company received the communication letter from the target company. The communication letter explained the communication process between Beikong clean energy group and the Hong Kong Stock Exchange on the pn15 spin off, and said that due to changes in the market environment, the financial data of the retained assets in 2021 failed to meet the relevant provisions on the profit indicators of the retained assets in Chapter 8 of the rules for the listing of securities on the stock exchange of Hong Kong Limited. According to the prudent judgment of intermediaries, “The proposed spin off will not be approved if it does not comply with the relevant rules,” he said. Accordingly, Beikong clean energy group has no plans or arrangements for further communication with the Hong Kong stock exchange. According to the agreement on Sec Electric Machinery Co.Ltd(603988) major asset replacement and issuance of shares to purchase assets signed by all parties to the transaction, one of the preconditions for the implementation of this transaction is to obtain the approval of the Hong Kong stock exchange. The failure to obtain the approval of the Hong Kong stock exchange for this spin off will lead to the failure to reach the preconditions of this transaction and the inability to continue the implementation of this transaction. Based on the review of the Hong Kong stock exchange, it is suggested to further negotiate on the matters related to the proposed termination of this transaction, communicate with other transaction participants for confirmation as soon as possible, and jointly reach a termination agreement on this transaction.
On February 17, 2022, the listed company signed the memorandum on the termination of Sec Electric Machinery Co.Ltd(603988) major asset restructuring with Tianjin Fuqing Investment Co., Ltd., Wang Jianyu and Wang Jiankai. After negotiation, all parties agreed to terminate this major asset restructuring.
On February 25, 2022, the listed company and the target company, all shareholders of the target company, Wang Jianyu and Wang Jiankai signed the termination agreement on the agreement related to Sec Electric Machinery Co.Ltd(603988) major asset restructuring. All parties agreed to terminate the major asset restructuring and reached an agreement on the professional service fees to be borne by the target company and the intermediary institutions related to the assets to be placed in the major asset restructuring. 4、 Terminate the decision-making procedures for this major asset restructuring
(I) deliberations of the board of directors
On February 25, 2022, the listed company held the 17th meeting of the 4th board of directors, deliberated and adopted the proposal on terminating major asset restructuring, the proposal on terminating the agreement on signing restructuring related agreements between the company and the counterparty, and the proposal on canceling the first extraordinary general meeting of shareholders in 2021, It is agreed that the listed company shall terminate this major asset reorganization.
(II) prior approval opinions of independent directors
The independent directors of the listed company recognized the termination of this major asset reorganization in advance and believed that the termination of this major asset reorganization by the listed company complies with the provisions of the company law of the people’s Republic of China, the securities law of the people’s Republic of China, the measures for the administration of major asset reorganization of listed companies and other relevant laws, administrative regulations and normative documents, It is a decision made based on prudent judgment and full communication and negotiation. There is no damage to the interests of the listed company and all shareholders, and it will not have an adverse impact on the current and future financial status of the listed company. Therefore, the independent directors agree that the listed company shall terminate this major asset restructuring and other related matters, and agree to submit relevant proposals to the 17th meeting of the Fourth Board of directors for deliberation. The related directors shall avoid voting on relevant proposals in accordance with relevant laws, regulations and the articles of association.
(III) opinions of independent directors
The independent directors believe that: 1. The relevant proposals considered at the 17th meeting of the 4th board of directors of the listed company have been approved by the independent directors in advance before being submitted to the 17th meeting of the 4th board of directors of the listed company for deliberation, and the relevant proposals have been deliberated and adopted at the 17th meeting of the 4th board of directors of the listed company. The convening and convening procedures, voting procedures and methods of the board meeting comply with the provisions of relevant national laws, regulations, normative documents and the articles of association, and the related directors have avoided voting. 2. The termination of this major asset reorganization by the listed company complies with the provisions of the company law of the people’s Republic of China, the securities law of the people’s Republic of China, the measures for the administration of major asset reorganization of listed companies and other relevant laws, administrative regulations and normative documents. It is a decision made based on prudent judgment and full communication and consultation, There is no damage to the interests of the listed company and all shareholders, which will not have an adverse impact on the current and future financial situation of the listed company.
(IV) deliberation of the board of supervisors
On February 25, 2022, the listed company held the 16th meeting of the 4th board of supervisors, deliberated and approved the proposal on terminating the major asset restructuring and the proposal on signing the termination agreement of the restructuring related agreement between the company and the counterparty, and agreed to terminate the major asset restructuring. 5、 Insider trading of company shares during self inspection
In accordance with the requirements of the notice on regulating the information disclosure of listed companies and the behavior of relevant parties, the questions and answers on strengthening the prevention and control of insider trading in mergers and acquisitions of listed companies, and the self regulatory guidelines for listed companies of Shanghai Stock Exchange No. 6 – major asset restructuring, The listed company is carrying out insider registration and self inspection on this reorganization. The self inspection period is 6 months before the listed company applies for stock suspension (March 15, 2021) to the announcement date of the resolution of the board of directors of the listed company to consider and terminate this reorganization.
The listed company plans to conduct self inspection
