Luoyang Jalon Micro-Nano New Materials Co.Ltd(688357)
Management system of raised funds
Chapter I General Provisions
Article 1 in order to standardize the mechanism for the storage, use, management, supervision and accountability of the raised funds of Luoyang Jalon Micro-Nano New Materials Co.Ltd(688357) (hereinafter referred to as the “company”), improve the efficiency of the use of the raised funds and protect the legitimate rights and interests of investors, in accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”) Securities Law of the people’s Republic of China (hereinafter referred to as “Securities Law”) Guidelines for the governance of listed companies (revised in 2018), guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies (revised in 2022), guidelines for the self regulatory rules of listed companies on the science and Innovation Board of Shanghai Stock Exchange No. 1 – standardized operation, and provisions on the report on the use of previously raised funds This system is formulated in combination with the actual situation of the company, in accordance with the relevant laws, regulations, normative documents such as the Listing Rules of shares on the science and Innovation Board of Shanghai Stock Exchange and the relevant provisions of the Luoyang Jalon Micro-Nano New Materials Co.Ltd(688357) articles of Association (hereinafter referred to as the “articles of Association”).
Article 2 the term “raised funds” as mentioned in this system refers to the funds raised by the company through the issuance of securities to unspecified objects (including initial public offering of shares, allotment of shares, additional issuance, issuance of convertible corporate bonds, issuance of convertible corporate bonds with separate transactions, etc.) and the issuance of securities to specific objects, but does not include the funds raised by the company through the implementation of equity incentive plan. Article 3 the use of the raised funds of the company shall comply with the national industrial policies and relevant laws and regulations, and shall invest in the field of scientific and technological innovation, so as to improve the return of shareholders and increase the return on assets of the company.
Article 4 the company implements the special account storage system for raised funds, and adheres to the principle of centralized storage and convenient supervision and management.
Article 5 the funds raised by the company shall be used for the purposes listed in the prospectus or other public offering documents. Where a company changes the use of funds listed in the prospectus or other documents for public offering and raising, a resolution must be made by the general meeting of shareholders.
Article 6 in case of any change of the company’s raised investment project, it must be deliberated and approved by the board of directors and the general meeting of shareholders, and the change can only be made after the express consent of independent directors, recommendation institutions, independent financial advisers and the board of supervisors.
Article 7 the board of directors of the company shall be responsible for the use and management of the raised funds, and the board of supervisors and independent directors of the company shall supervise the management and use of the raised funds. During the period of continuous supervision, the recommendation institution or independent financial consultant shall perform the responsibility of recommendation for the management and use of the company’s raised funds, and carry out continuous supervision in accordance with relevant regulations.
Article 8 if the investment project with raised funds (hereinafter referred to as “raised investment project”) is implemented through the company’s subsidiaries or other enterprises controlled by the company, the company shall ensure that the subsidiaries or other enterprises controlled by the company comply with the raised funds management system.
Chapter II deposit of raised funds in special account
Article 9 the raised funds shall be deposited in a special account approved by the board of directors (hereinafter referred to as the “special account”) for centralized management and use, and a tripartite supervision agreement shall be signed with the recommendation institution or independent financial consultant and the commercial bank storing the raised funds within one month after the raised funds are in place.
The special account for raised funds shall not deposit non raised funds or be used for other purposes.
Article 10 where the company has raised funds for more than two times, it shall set up a special account for raised funds independently.
Article 11 the company shall select a commercial bank with good reputation, considerate service and convenient access to set up a special account to store the raised funds.
Article 12 the company shall sign a three-party supervision agreement (hereinafter referred to as the “agreement”) with the recommendation institution or independent financial consultant and the commercial bank storing the raised funds (hereinafter referred to as the “commercial bank”) within one month after the receipt of the raised funds. The agreement shall at least include the following contents:
(I) the company shall deposit the raised funds in a special account;
(II) the commercial bank shall provide the company with a special account bank statement every month and send a copy to the recommendation institution or independent financial adviser;
(III) if the company withdraws more than 50 million yuan from the special account in one time or within 12 months and reaches 20% of the net amount of the total amount of funds raised after deducting the issuance expenses (hereinafter referred to as the “net amount of funds raised”), the company shall timely notify the recommendation institution or independent financial adviser;
(IV) a recommendation institution or an independent financial consultant may inquire about the special account information at a commercial bank at any time;
(V) liability for breach of contract of the company, commercial bank and sponsor.
The company shall report to the Shanghai stock exchange for filing and make an announcement within 2 trading days after the signing of the above agreement.
Where a company implements a raised investment project through a holding subsidiary or other entity, a tripartite supervision agreement shall be signed by the company, the company implementing the raised investment project, commercial banks, recommendation institutions or independent financial advisers. The company and the company implementing the raised investment project shall be regarded as the same party.
If the above-mentioned agreement is terminated in advance due to the change of recommendation institution, independent financial consultant or commercial bank before the expiration of the validity period, the company shall sign a new agreement with relevant parties within one month from the date of termination of the agreement, and report to Shanghai stock exchange for filing and announcement within two trading days after the signing of the new agreement.
Article 13 the establishment of a special account for the storage of raised funds and the storage of raised funds shall be handled by the financial department of the company, supervised by the chief financial officer and supervised by the board of supervisors. The Finance Department of the company shall regularly check the deposit balance of the raised funds to ensure the consistency between accounts and facts.
Chapter III use of raised funds
Section 1 General Provisions on the use of raised funds
Article 14 the company shall comply with the following requirements when using the raised funds:
(I) the company shall make clear provisions on the application, hierarchical approval authority, decision-making procedures, risk control measures and information disclosure procedures for the use of raised funds;
(II) the company shall use the raised funds in accordance with the use plan of the raised funds promised in the issuance application documents; (III) in case of any situation that seriously affects the normal use of the raised funds, the company shall timely report to the Shanghai Stock Exchange and make an announcement.
(Ⅳ)
Article 15 in principle, the funds raised by the company shall be used for its main business. The investment projects of raised funds shall not be financial investments such as holding trading financial assets and financial assets available for sale, lending to others and entrusted financial management, and shall not be invested directly or indirectly in companies whose main business is the trading of securities.
The company shall not commit any of the following acts when using the raised funds:
(I) the raised funds are used to carry out entrusted financial management (except cash management), entrusted loans and other financial investments, securities investment, derivatives investment and other high-risk investments, as well as direct or indirect investment in companies whose main business is the purchase and sale of securities;
(II) changing the purpose of the raised funds in a disguised form through pledge, entrusted loan or other means;
(III) provide the raised funds directly or indirectly to the controlling shareholder, actual controller and other related persons for use, so as to facilitate the related persons to obtain illegitimate interests by using the raised investment project;
(IV) other acts in violation of the provisions on the management of raised funds.
Article 16 the company shall ensure the authenticity and fairness of the use of the raised funds, prevent the raised funds from being occupied or misappropriated by the controlling shareholders, actual controllers and other related persons, and take effective measures to prevent the related persons from using the raised investment projects to obtain improper interests or damage the interests of the company and other investors.
Article 17 the company shall use the raised funds in accordance with the use plan of the raised funds promised in the issuance application documents. The use of the company’s raised funds shall be carried out in accordance with the company’s internal management documents.
Article 18 the company shall comprehensively check the progress of raised investment projects after the end of each fiscal year.
Article 19 in case of any of the following circumstances in a raised investment project, the company shall re demonstrate the feasibility and expected income of the project, decide whether to continue to implement the project, and disclose the progress of the project, the reasons for abnormalities and the adjusted raised capital investment plan (if any) in the latest periodic report:
(I) significant changes have taken place in the market environment involved in the raised investment project;
(II) the raised investment project has been shelved for more than one year;
(III) exceeding the completion period of the investment plan of the raised funds and the investment amount of the raised funds does not reach 50% of the relevant plan amount;
(IV) other abnormal circumstances occur in the raised investment project.
Article 20 if the company decides to terminate the original raised investment project, it shall scientifically select a new investment project as soon as possible. Article 21 if the company invests self raised funds into projects invested with raised funds in advance, it can replace the self raised funds with the raised funds within 6 months after the arrival of the raised funds.
The replacement matters shall be deliberated and approved by the board of directors of the company, the accounting firm shall issue an assurance report, and the independent directors, the board of supervisors, the recommendation institution or the independent financial consultant shall express their explicit consent. The company shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the board of directors.
Section II use of idle funds
Article 22 the temporarily idle raised funds can be managed in cash, and the invested products must meet the following conditions:
(I) principal guaranteed products with high security such as structured deposits and certificates of deposit;
(II) good liquidity shall not affect the normal progress of the investment plan of the raised funds.
Investment products shall not be pledged, and the special product settlement account (if applicable) shall not deposit non raised funds or be used for other purposes. If the special product settlement account is opened or cancelled, the company shall report to Shanghai stock exchange for filing and announcement within 2 trading days.
Article 23 the use of idle raised funds to invest in products shall be examined and approved by the board of directors of the company, and the independent directors, the board of supervisors, the recommendation institution or the independent financial adviser shall express their explicit consent. The company shall announce the following contents within 2 trading days after the meeting of the board of directors:
(I) basic information of the funds raised this time, including the time of raising, the amount of funds raised, the net amount of funds raised and the investment plan;
(II) use of raised funds;
(III) the amount and term of idle raised funds investment products, whether there is any behavior of changing the purpose of raised funds in a disguised form and measures to ensure that the normal progress of raised funds projects will not be affected;
(IV) income distribution mode, investment scope and safety of investment products;
(V) opinions issued by independent directors, board of supervisors, recommendation institutions or independent financial advisers.
Article 24 the raised funds temporarily idle may be temporarily used to supplement working capital.
However, the following conditions shall be met:
(I) the purpose of the raised funds shall not be changed in a disguised form, and the normal progress of the investment plan of the raised funds shall not be affected; (II) it is limited to the production and operation related to the main business, and shall not be used for the placement and purchase of new shares, or for the trading of stocks and their derivatives, convertible corporate bonds, etc. through direct or indirect arrangements;
(III) the time for a single replenishment of working capital shall not exceed 12 months;
(IV) the funds previously raised for temporary replenishment of working capital that have been returned and have expired (if applicable).
If the company uses idle raised funds to supplement working capital temporarily, it shall be deliberated and approved by the board of directors of the company, and the independent directors, the board of supervisors, the recommendation institution or the independent financial adviser shall give clear consent, and report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the board of directors.
Before the due date of replenishing working capital, the company shall return this part of funds to the special account for raised funds, and report to Shanghai Stock Exchange and make an announcement within 2 trading days after the return of all funds.
Section III use of surplus raised funds
Article 25 after the completion of a single or all raised investment project, the company’s use of the surplus raised funds (including interest income) of the project for other purposes shall be subject to the deliberation and approval of the board of directors and the express consent of the independent director, recommendation institution or independent financial consultant and the board of supervisors. The company shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the board of directors.
If the surplus raised funds (including interest income) are less than 10 million yuan, they may be exempted from the procedures specified in the preceding paragraph, and the use of the relevant raised funds shall be disclosed in the annual report.
Article 26 after all the projects invested by raising funds are completed, if the remaining raised funds (including interest income) exceed 10% of the net raised funds, they shall be examined and approved by the board of directors and the general meeting of shareholders of the company, and the raised funds can be used only after the opinions of independent directors, recommendation institutions, independent financial consultants and the board of supervisors are given.
The company shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the board of directors.
If the surplus raised funds (including interest income) are less than 10% of the net raised funds, they can only be used after being deliberated and approved by the board of directors and the opinions of independent directors, recommendation institutions, independent financial consultants and the board of supervisors. The company shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the board of directors.
If the surplus raised funds (including interest income) are less than 5 million yuan or less than 5% of the net raised funds, they may be exempted from the procedures in the preceding paragraph, and their use shall be disclosed in the latest periodic report.
Section IV use of over raised funds
Article 27 Where the net amount of funds actually raised by the company exceeds the amount of funds planned to be raised (hereinafter referred to as “over raised funds”), the provisions of this section shall apply at the same time.
Article 28 If the company uses the over raised funds for projects under construction and new projects (including the acquisition of assets, etc.), it shall be used for the main business of the company, which shall be submitted to the board of directors for deliberation and approval. The independent directors, the board of supervisors, the recommendation institution or the independent financial consultant or the independent financial consultant shall issue explicit consent opinions, and conduct the feasibility analysis of the investment project scientifically and prudently, Timely fulfill the obligation of information disclosure.
If the company plans to use the over raised funds for a single time to reach 50 million yuan and more than 10% of the total over raised funds, it shall also be submitted to the general meeting of shareholders for deliberation and approval.
Article 29 the over raised funds can be used for permanent replenishment of working capital and repayment of bank loans. The cumulative amount used within each 12 months shall not exceed 30% of the total amount of over raised funds, and it shall promise not to make high-risk investment or provide financial assistance to others within 12 months after replenishing working capital.
The provisions of the preceding paragraph shall not apply to the joint investment of the company and professional investment institutions in investment funds related to its main business, or market-oriented investment funds such as industrial investment funds in poor areas and poverty alleviation public welfare funds.
Article 30 the company shall, at the latest
