Everbright Securities Company Limited(601788)
about
Chengda Pharmaceutical Co., Ltd. initial public offering and listing on the gem
Issuance recommendation work report
Sponsor
December, 2001
Statement of recommendation institution and recommendation representative
According to the company law of the people’s Republic of China and the securities law of the people’s Republic of China Measures for the administration of the registration of initial public offerings on the gem (for Trial Implementation) and measures for the administration of securities issuance and listing recommendation business And other relevant laws, administrative regulations and the provisions of the China Securities Regulatory Commission, be honest, trustworthy, diligent and responsible, issue this issuance recommendation work report in strict accordance with the business rules, industry practice norms and ethical standards formulated according to law, and ensure the authenticity, accuracy and integrity of this issuance recommendation work report.
Unless otherwise specified, the relevant terms in this offering recommendation work report have the same meanings as those in the prospectus of Chengda Pharmaceutical Co., Ltd. for initial public offering and listing on the gem.
catalogue
The sponsor and its representative declare that 1 catalog Section 1 project operation process three
1、 Internal audit process of the sponsor three
2、 The sponsor’s review on the project initiation of this securities issuance project five
3、 The main process of the sponsor’s implementation of the securities issuance project five
4、 The main process of the quality control headquarters of the recommendation institution reviewing the securities issuance project eight
5、 The sponsor’s implementation of the verification procedures for this securities issuance project eight
6、 The review process of the sponsor’s core team on the securities issuance project Section II existing problems and solutions of the project ten
1、 Opinions and deliberations of members of the project evaluation decision-making body ten
2、 Main issues concerned during due diligence and their solutions ten
3、 Main issues concerned by the internal verification department and their specific implementation thirteen
4、 Review opinions and specific implementation of the nuclear team meeting seventy-five
5、 Verification of relevant matters of the issuer by the recommendation institution in accordance with the requirements of the regulatory authorities eighty-four
6、 Previous declaration ninety-five
7、 Verification of professional opinions of securities service institutions by recommendation institutions ninety-seven
8、 Other situations that need to be explained ninety-eight
Section I project operation process
1、 Internal audit process of the recommendation institution (I) description of project initiation audit process
1. Project initiation within the business team: after completing the preliminary due diligence, the project team may apply to its business team for projects that are of value and meet the company’s project initiation standards. After the business team meeting is approved and the business headquarters performs the approval procedures, it can submit an application for project initiation to the quality control headquarters of investment bank (hereinafter referred to as “quality control headquarters”).
2. Review by the quality control headquarters: the quality control headquarters arranges the quality control specialist to review the project initiation application documents and issue written review opinions. The business team shall make a written reply to the audit opinions, and modify, supplement and improve the project initiation application documents according to the audit opinions.
3. Deliberation and voting of the investment bank project initiation team: the quality control headquarters will convene and preside over the project initiation team meeting according to the project progress. Before the project initiation meeting, the quality control headquarters shall send the modified project initiation application documents, project initiation review opinions and their replies to the members of the project initiation team. At the project initiation meeting, the quality control specialist shall report the main problems found during the project audit to all participants, and require the sponsor representative and the project team to explain and explain the relevant problems and solutions. On the basis of full discussion on the main issues of the project, all project initiation team members shall vote whether the project passes the review of the project initiation meeting. The project initiation meeting can be held only when more than half of the project initiation team members are present and the number of voting participants is not less than 5; The project is approved after more than two-thirds of the voting group members express their “consent” opinions.
4. The quality control headquarters is responsible for sorting out and forming the summary of project initiation opinions and project initiation resolutions. The project team implements the project initiation opinions and submits them to the quality control headquarters for review. After the quality control headquarters has no objection, it issues the project initiation resolutions signed and confirmed by the project initiation team members. （2） Description of kernel audit process
1. Business team core application: the project team completes the project due diligence in accordance with the regulatory laws and regulations and other normative documents and Everbright Securities Company Limited(601788) internal requirements, and on this basis, prepares and completes the core application documents, including the core application report, a full set of application documents and working papers that meet the regulatory requirements. The items that meet the requirements and have controllable risks are reviewed by the quality control specialist of the business team and reviewed by the internal meeting of the business team
2. Audit of quality control headquarters: the quality control headquarters shall appoint a special quality control specialist to audit the kernel application documents in writing, and conduct on-site audit on the sponsor projects according to the company’s system requirements. The auditors of the quality control headquarters conduct on-site audit by visiting and inspecting the issuer’s office, production and business premises, reviewing key problems in the process of due diligence, communicating with relevant personnel of the project team and intermediary institutions, checking the working papers of the project team, and interviewing the actual controllers and senior managers of the company.
The quality control headquarters shall issue the project quality control report after completing the audit and on-site audit of the core application materials and the acceptance of the project working paper, listing the possible risks and problems needing attention of the project; The project team shall fully implement the opinions of the quality control headquarters, modify and supplement the core documents and submit them to the core institutions for deliberation. 3. Business head office verification: according to the application of the business team, the compliance team of the business head office shall convene the signing and recommendation representatives of the project to perform the verification procedures and inquire about the due diligence of the recommendation project. The sponsor representative shall make a statement on the due diligence of relevant matters in the project audit, fill in the questionnaire on due diligence of important matters of the sponsor project, transcribe the commitments attached to the questionnaire and sign for confirmation. As an annex to the issuance recommendation work report, the Due Diligence Checklist on important matters of recommendation projects shall be submitted together with the issuer’s listing application documents.
4、 Audit by investment bank core office: investment bank core office (hereinafter referred to as “core office”) ）After the auditor or the audit team has no objection to the audit of the kernel application materials, the project can be submitted to the kernel team meeting for deliberation with the consent of the leader of the kernel team. The kernel office is responsible for organizing and holding the kernel group meeting. In principle, the notice of the meeting shall be issued at least 3 days before the meeting and the kernel materials shall be sent to the kernel members participating in the meeting. 5. Deliberation at the investment banking core group meeting: the investment banking core group will conduct on-site Communication (including teleconference, video conference, etc.) and other meetings shall be held to make a resolution on the collective voting of the review items; the meeting can be held only when the number of members of the core group present and participating in the voting is not less than 7; the core of the project shall be passed when more than two-thirds (including) of the members of the core group with voting rights vote “agree”.
6. Matters after the meeting: the kernel office shall sort out and form the summary of kernel opinions according to the opinions of the kernel team members, and feed back to the project team. The project team shall discuss and implement the issues involved in the summary of kernel opinions, and submit the reply of kernel opinions to the kernel office for review. After passing the review, the kernel office shall issue the kernel resolution signed and confirmed by the participating kernel members.
The project team shall go through the procedures of signing and approving the issuance application documents such as the issuance recommendation letter and the issuance recommendation work report, and submit them to the regulatory authority after being approved by the recommendation institution. 2、 Review of the sponsor’s approval of the securities issuance project
The application for approval of this securities issuance project is December 12, 2019.
On January 6, 2020, the sponsor held an investment bank project initiation team meeting to review the securities issuance project. The project initiation team members attending the meeting included Xue Jiang, Tan Yiming, Zhang Jingjing, Fu Liqiang, Liu Yingfang and Zhang Fei.
All participants listened to the introduction of the project team members on the specific situation of the project, inquired about the main problems existing in the project, and voted collectively on the basis of full discussion. The voting result was 6 affirmative votes, 0 dissenting votes and 0 deferred votes. After voting, the IPO project of Chengda Pharmaceutical Co., Ltd. was approved. 3、 The main process of the recommendation institution on the implementation of the securities issuance project (I) the composition of the executive members of the securities issuance project
Sponsor representatives: Yang Ke, fan Guozu
Project Co organizer: Han Jianlong
Other members of the project team: Li Shuang, Liu Kan, Fang Yuting and Geng Zhongliang (II) mobilization time
In November 2019, members of the sponsor’s project team began to officially enter the site of Chengda pharmaceutical’s IPO project to carry out due diligence, counseling and other related work. （3） Main process of due diligence
In this recommendation work, the project team, in accordance with the measures for the administration of securities issuance and listing recommendation business, the guidelines for the due diligence of sponsors, the guidelines for the working papers of securities issuance and listing recommendation business, and the opinions on further improving the quality of financial information disclosure of initial public offering companies In accordance with the requirements of normative documents such as the guidelines on information disclosure related to profitability in the prospectus of initial public offering and listed companies, the guidelines on the disclosure of major financial information and operating status information after the audit deadline of the financial report of the prospectus of initial public offering and listed companies, and abide by the principles of independence, objectivity and impartiality, A comprehensive investigation has been conducted on the issuer, and the due diligence work runs through the whole process of securities issuance and listing.
1. Scope of due diligence
The scope of due diligence of the project team includes: basic information of the issuer, business and technology, corporate governance and independence, finance and accounting, application of raised funds and future development planning, risk factors and other important matters. 2. Due diligence process
In this recommendation work, the project team followed the principles of diligence, honesty and trustworthiness, and made careful verification on the issuer in accordance with the requirements of normative documents such as the measures for the administration of securities issuance and listing recommendation business, the guidelines for the due diligence of sponsors, and the guidelines for the working paper of securities issuance and listing recommendation business. The details are as follows:
1. The project team reviews the relevant establishment and change approval documents of the issuer, the business license, articles of association, resolution documents of the general meeting of shareholders, the board of directors and the board of supervisors since its establishment, financial reports and audit reports over the years, relevant important contracts, ownership certificates and change certificates of the company’s main properties, and relevant information of major shareholders and their controlled enterprises, The basic information of the issuer was investigated by visiting relevant government departments and interviewing relevant personnel of the company and major shareholders.
2. Through on-site investigation, obtaining the company’s business process data, consulting financial data, consulting the ownership certificate of main assets, collecting the company’s industry laws, regulations and normative documents, collecting industry research reports and talking with relevant personnel of the company, the project team has made a comprehensive analysis of the issuer’s main business, product characteristics and uses, policies and plans of the industry The industry status and competition, market prospect, the issuer’s industry status and competitive advantages and disadvantages, the issuer’s process flow and technology, R & D system and innovation mechanism, environmental protection and other business and technology related situations were investigated.
3. The project team investigated the issuer’s horizontal competition and related transactions by consulting the articles of association, the business license of major shareholders, the articles of association or partnership agreement, the financial reports and relevant financial materials of relevant years, the contracts signed between the company and related parties, the materials of the three meetings, relevant commitment letters, etc.
4. The project team investigated the directors, supervisors, senior managers and other core personnel of the issuer by communicating with the personnel and Administration Department of the issuer, consulting the documents of the third meeting, the articles of association and talking with relevant personnel of the company.
5. The project team investigated the issuer’s organizational structure and internal control system by consulting the issuer’s articles of association, corporate governance system, three meeting documents, basic management system, interviewing senior managers and employees of relevant departments, consulting the issuer’s accountants and lawyers.
6. The project team investigated the financial and accounting status of the issuer by consulting the company’s financial reports and audit reports, accounting records and business documents, spot checking the corresponding documents, vouchers and contracts, communicating with the company’s financial personnel, consulting the issuer’s accountants, interviewing important customers and suppliers, etc.
7. The project team investigated the relevant situation of the raised capital investment project by obtaining the issuer’s feasibility study report and filing documents, the decisions of the third board of directors, the resolutions of the board of directors and the general meeting of shareholders, and interviews with senior managers.
8. The project team investigated the company’s business development and planning by consulting the issuer’s strategic planning documents, minutes of the third meeting and other relevant documents, interviewing senior executives, etc.
9. The project team understands the industrial policies, laws and regulations and future development direction of the issuer’s industry through consulting industry websites, government documents, reports of professional institutions and other channels, communicates with the company’s senior managers and main business leaders, analyzes the main risk factors faced by the company, and analyzes the issuer’s major contracts, lawsuits, guarantees The information disclosure system and its implementation, and the practice of intermediaries involved in this issuance were investigated. （4） Specific work arrangement of project team members
1. Working hours and main processes of sponsor representatives participating in due diligence
Yang Ke and fan Guozu, the sponsor representatives of the project, began to conduct due diligence on the issuer in November 2019. Through participating in the preliminary due diligence before counseling, the sponsor representative put forward the key problems and solutions that need to be paid attention to in the project, and made reasonable arrangements for the due diligence according to the project application progress; Presided over the listing guidance of the issuer, special verification of key issues and coordination meetings with the issuer and securities service institutions; Participated in important
