Jiangsu Shagang Co.Ltd(002075)
External guarantee management system
Chapter I General Provisions
Article 1 in order to standardize the external guarantee management of Jiangsu Shagang Co.Ltd(002075) (hereinafter referred to as “the company”), effectively control the external guarantee risk of the company, and protect the financial security of the company and 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”), the civil code of the people’s Republic of China (hereinafter referred to as the “Civil Code”), the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board, the Jiangsu Shagang Co.Ltd(002075) articles of Association (hereinafter referred to as the “articles of association”) and other relevant laws This system is formulated in accordance with the provisions of laws and regulations and in combination with the actual situation of the company.
Article 2 the term “external guarantee” as mentioned in this system refers to the guarantee provided by the company for others, including the guarantee of the company to its holding subsidiaries.
Article 3 the external guarantee of the company is subject to unified management. Without the approval of the board of directors or the general meeting of shareholders, no one has the right to sign contracts, agreements or other similar legal documents for external guarantee in the name of the company.
Article 4 the controlling shareholders and actual controllers shall maintain the company’s independent decision-making in providing guarantees, support and cooperate with the company to perform the internal decision-making procedures and information disclosure obligations of external guarantees in accordance with laws and regulations, and shall not force, instigate or require the company and relevant personnel to provide guarantees in violation of regulations.
If the controlling shareholder or actual controller forces, instructs or requires the company to engage in illegal guarantee acts, the company and its directors, supervisors and senior managers shall refuse, and shall not assist, cooperate or acquiesce.
Article 5 the external guarantee of the subsidiary controlled or actually controlled by the company shall be regarded as the behavior of the company, and its external guarantee shall be subject to this system. The holding subsidiary of the company shall timely notify the company to perform relevant information disclosure obligations after the resolution is made by its board of directors or shareholders’ meeting.
Article 6 the company’s external guarantee shall follow the principles of legality, prudence, mutual benefit and safety, and strictly control the guarantee risk.
Article 7 where the company provides guarantee for the controlling shareholder, actual controller and their related parties, the controlling shareholder, actual controller and their related parties shall provide counter guarantee.
Article 8 Where a company provides guarantee for a holding subsidiary or joint-stock company, other shareholders of the holding subsidiary or joint-stock company shall provide the same guarantee or counter guarantee and other risk control measures according to the proportion of capital contribution. If the relevant shareholders fail to provide the same proportion of guarantee or counter guarantee and other risk control measures to the company’s holding subsidiaries or joint-stock companies according to the proportion of capital contribution, the board of directors of the company shall disclose the main reasons, and fully explain whether the guarantee risk is controllable and whether it damages the interests of the company on the basis of analyzing the operation and solvency of the guarantee object. Article 9 the capital and Finance Department of the company is the Department in charge of external guarantee matters.
Article 10 the independent directors of the company shall express independent opinions when the board of Directors considers the external guarantee matters (excluding the guarantee provided to the subsidiaries within the scope of the consolidated statements), and may employ an accounting firm to check the accumulated and current external guarantee of the company when necessary. If any abnormality is found, it shall be reported to the board of directors and regulatory authorities in time and announced.
In the annual report, the independent directors of the company shall make special explanations on the company’s accumulated and current external guarantees and the implementation of the above provisions, and express independent opinions.
Chapter II Conditions for the company to provide external guarantee
Article 11 the company may provide guarantee for units with independent legal personality and one of the following conditions:
(I) mutual insurance units required by the company’s business;
(II) units with important business relations with the company;
(III) units with potentially important business relations with the company;
(IV) holding subsidiaries of the company and other units with control relationship.
The above units must have strong solvency and comply with the relevant provisions of this system.
Article 12 when providing external guarantee, the company shall take necessary measures to check the credit status of the guaranteed party, and decide whether to provide guarantee on the basis of prudent judgment of the guaranteed party’s ability to repay its debts.
Article 13 the information on credit status provided by an applicant for a guarantor shall at least include the following contents:
(I) basic information of the enterprise, including business license, copy of articles of association, identity certificate of legal representative, relevant information reflecting the relationship with the company and other relationships, etc;
(II) guarantee application, including but not limited to guarantee method, term, amount, etc;
(III) audited financial reports and analysis of repayment ability in recent three years;
(IV) copies of the main contract related to the loan;
(V) conditions and relevant materials for applying for the guarantor to provide counter guarantee;
(VI) there is no potential and ongoing major litigation, arbitration or administrative punishment; (VII) other important information.
Article 14 the board of directors shall carefully consider and analyze the financial status, operation status, industry prospect and credit situation of the applicant for guarantee, prudently make a decision according to law, fully analyze the interests and risks of the guarantee, and focus on the following conditions of the applicant for guarantee:
(I) it is an enterprise legal person established and effectively existing according to law, and there is no need to terminate;
(II) good operating and financial conditions, with stable cash flow or good development prospects;
(III) where a guarantee has been provided, there shall be no case where the creditor requires the company to bear joint and several guarantee liability;
(IV) have assets that can be mortgaged (pledged) and have corresponding counter guarantee ability;
(V) the financial information provided is true, complete and effective;
(VI) the company can take risk prevention measures against it;
(VII) there are no other legal risks.
The company may, when necessary, hire an external professional organization to assess the risk of implementing external guarantee, which can be used as the basis for the decision-making of the board of directors or the general meeting of shareholders.
Article 15 the capital and finance department shall investigate and verify the operation and financial status, project status, credit status and industry prospect of the applicant guarantor according to the basic data provided by the applicant guarantor, report to the relevant departments for review according to the contract approval procedures, and submit the relevant data to the board of directors or the general meeting of shareholders for approval after being approved by the leader in charge and the general manager.
Article 16 the board of directors or the general meeting of shareholders of the company shall review and vote on the submitted materials, and record the voting results. No guarantee shall be provided for any of the following circumstances or insufficient information: (I) the investment of funds does not comply with national laws and regulations or national industrial policies;
(II) there are false records or false information provided in the financial and accounting documents in the last three years;
(III) the company has provided guarantee for it, and there have been overdue bank loans and interest arrears, which have not been repaid or effective treatment measures cannot be implemented by the time of this guarantee application;
(IV) the business condition has deteriorated, the reputation is bad, and there is no sign of improvement;
(V) failing to implement the effective property used for counter guarantee;
(VI) other circumstances in which the board of Directors considers that the guarantee cannot be provided.
Article 17 the counter guarantee or other effective risk prevention measures provided by the applicant for guarantee must correspond to the amount of guarantee. If the property of the guarantor applying for the creation of a counter guarantee is prohibited from circulation or non transferable by laws and regulations, the guarantor shall refuse the guarantee.
Chapter III Procedures for examination and approval of external guarantees
Article 18 the guarantee provided by the company shall not only be deliberated and approved by more than half of all directors, but also be deliberated and approved by more than two-thirds of the directors attending the meeting of the board of directors and made a resolution, and shall be disclosed to the public in a timely manner. The company shall not provide guarantee without the deliberation and approval of the board of directors or the general meeting of shareholders.
Article 19 external guarantees that should be approved by the general meeting of shareholders can only be submitted to the general meeting of shareholders for approval after being deliberated and approved by the board of directors.
Article 20 the following external guarantees of the company shall be deliberated and approved by the general meeting of shareholders:
(I) the amount of a single guarantee exceeds 10% of the company’s latest audited net assets;
(II) any guarantee provided after the total amount of guarantee provided by the company and its holding subsidiaries exceeds 50% of the company’s latest audited net assets;
(III) any guarantee provided after the total amount of guarantee provided by the company and its holding subsidiaries exceeds 30% of the total audited assets of the company in the latest period;
(IV) the latest financial statement data of the guaranteed object shows that the asset liability ratio exceeds 70%; (V) the accumulative amount of guarantee in the last 12 months exceeds 30% of the company’s total assets audited in the latest period;
(VI) guarantees provided to shareholders, actual controllers and their affiliates;
(VII) other guarantees stipulated by the CSRC, Shenzhen Stock Exchange or the articles of association. When the general meeting of shareholders of the company deliberates the guarantee matters in Item (V) of the preceding paragraph, it shall be approved by more than two-thirds of the voting rights held by the shareholders attending the meeting.
Article 21 except for the external guarantees that shall be deliberated and approved by the general meeting of shareholders as stipulated in Article 20 of the system, other external guarantees shall be deliberated and approved by the board of directors.
Article 22 the company provides guarantees to its holding subsidiaries. If there are a large number of guarantee agreements every year and it is difficult to submit each agreement to the board of directors or the general meeting of shareholders for deliberation, The company can estimate the total amount of new guarantee for two types of subsidiaries with asset liability ratio of more than 70% and less than 70% in the latest financial statements in the next 12 months, and submit it to the general meeting of shareholders for deliberation.
When the aforesaid guarantee matters actually occur, the company shall disclose them in time, and the guarantee balance at any time point shall not exceed the guarantee amount deliberated and approved by the general meeting of shareholders.
Article 23 Where the company provides guarantee for related parties, in addition to being deliberated and approved by more than half of all non related directors, it shall also be deliberated and approved by more than two-thirds of the non related directors attending the meeting of the board of directors and make a resolution, which shall be submitted to the general meeting of shareholders for deliberation.
If the guaranteed party becomes an affiliate of the company due to the transaction, the company shall perform corresponding review procedures and information disclosure obligations on the existing affiliated guarantee while implementing the transaction or affiliated transaction. If the board of directors or the general meeting of shareholders fails to consider and approve the related guarantee matters specified in the preceding paragraph, all parties to the transaction shall take effective measures such as early termination of the guarantee.
Article 24 for external guarantee, the company must conclude a written guarantee contract and counter guarantee contract. The guarantee contract and counter guarantee contract shall meet the requirements of the civil code and other laws and regulations.
Article 25 a guarantee contract shall at least include the following contents:
(I) type and amount of principal creditor’s rights guaranteed;
(II) the time limit for the debtor to perform its obligations;
(III) guarantee method;
(IV) scope of guarantee;
(V) term of guarantee;
(VI) contents of guarantee contracts in different ways stipulated by laws and regulations
(VII) other matters that the parties consider necessary to be agreed.
Article 26 when a guarantee contract is concluded, the relevant departments shall comprehensively and carefully examine the signing subject and relevant contents of the main contract, guarantee contract and counter guarantee contract. For clauses that violate laws, administrative regulations, the articles of association, relevant resolutions of the board of directors or the general meeting of shareholders, and impose unreasonable obligations on the company or cannot predict risks, the other party shall be required to modify them. If the other party refuses to modify, the relevant departments shall refuse to provide guarantee for it and report to the board of directors or the general meeting of shareholders of the company.
Article 27 the chairman of the board of directors or other persons legally authorized shall sign the guarantee contract on behalf of the company in accordance with the resolutions of the board of directors or the general meeting of shareholders of the company. No one shall sign a guarantee contract on behalf of the company without the approval and authorization of the general meeting of shareholders or the board of directors. The handling department and the handling person shall not sign the guarantee contract beyond their authority or sign or seal as the guarantor in the main contract.
Article 28 If an external guarantee that has been approved in accordance with the authority specified in this chapter fails to sign the relevant guarantee contract within 90 days after the approval, and the guarantee formalities are handled after the time limit is exceeded, it shall be regarded as a new guarantee and the approval formalities shall be handled again in accordance with the provisions of this chapter.
Article 29 the company may sign a mutual insurance agreement with an enterprise legal person that meets the conditions specified in this system. The responsible person shall timely require the other party to truthfully provide relevant financial and accounting statements and other materials that can reflect its solvency.
Article 30 when accepting counter guarantee mortgage and counter guarantee pledge, the capital and Finance Department of the company, together with the perennial legal adviser, shall improve the relevant legal procedures, especially the registration of mortgage or pledge in time.
Article 31 the counter guarantee provided by the company and its holding subsidiaries shall be implemented in accordance with the relevant provisions of the guarantee, and the corresponding deliberation procedures and information disclosure obligations shall be performed based on the amount of the counter guarantee provided by the company and its holding subsidiaries, except for the counter guarantee provided by the company and its holding subsidiaries for the guarantee based on its own debts.
Article 32 If the debt guaranteed by the company needs to be extended after maturity and needs to continue to be guaranteed by it, it shall be used as a new external guarantee and re perform the guarantee approval procedures and information disclosure obligations.
Chapter IV administration of external guarantee
Article 33 the external guarantee of the company shall be initiated by the capital and finance department, which shall review the matters related to the external guarantee together with the securities affairs department.
Article 34 the main responsibilities of the capital and finance department are as follows:
(I) review and evaluate the basic information, credit status, financial status, operation status and credit status of the guaranteed unit;
(II) evaluate the financing necessity, purpose and repayment ability of the guaranteed unit;
(III) participate in the conclusion of guarantee contract and provide relevant professional opinions;
(IV) execute and implement the terms agreed in the guarantee contract and the matters required by the general meeting of shareholders and the board of directors of the company; (V) properly handle the unexpected situations in the execution of guarantee business and effectively control the risks;
(VI) track, inspect and supervise the guaranteed unit, terminate the guarantee relationship in time and handle the cancellation of the guarantee in accordance with the contract;
(VII) earnestly do a good job in the filing and management of documents related to the guaranteed enterprise;
(VIII) handle other matters related to guarantee.
Article 35 the company shall properly manage the guarantee contract and relevant original materials, timely clean up and inspect them, and communicate with them regularly
