Guangdong No.2 Hydropower Engineering Company Ltd(002060)
Announcement on resolutions of the 23rd Meeting of the 7th board of directors
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.
On March 11, 2022, the notice of the 23rd Meeting of the seventh board of directors of Guangdong No.2 Hydropower Engineering Company Ltd(002060) (hereinafter referred to as “the company”) was sent to all directors in the form of e-mail. The meeting was held by means of communication voting on March 18, 2022. There are 9 directors who should attend the meeting and 9 directors who actually attend the meeting. Members of the board of supervisors of the company attended the meeting as nonvoting delegates.
Since Mr. Chen Pengfei, the director of the company, sent directors to the controlling shareholder, Mr. Chen Pengfei avoided voting on proposals 1 to 12.
The meeting was held in accordance with the relevant provisions of the company law and the articles of association, considered all the proposals listed in the notice and made the following resolutions:
1、 8 affirmative votes, 0 negative votes, 0 abstention votes, 1 abstention vote, passed the proposal on the compliance of the company’s issuance of shares to purchase assets and the raising of supporting funds and related party transactions with relevant laws and regulations (this proposal needs to be submitted to the general meeting of shareholders for deliberation);
The company plans to purchase 100% equity of Guangdong Construction Engineering Group Co., Ltd. (hereinafter referred to as “Construction Engineering Group” or “target company”) from Guangdong Construction Engineering Group Holding Co., Ltd. (hereinafter referred to as “Construction Engineering Group”) by issuing shares, and plans to raise matching funds (hereinafter referred to as “this reorganization” or “this transaction”) from non-public issuance of shares to no more than 35 qualified specific objects.
According to the company law of the people’s Republic of China (hereinafter referred to as the “company law”), the securities law of the people’s Republic of China (hereinafter referred to as the “Securities Law”), the measures for the administration of major asset restructuring of listed companies (hereinafter referred to as the “measures for the administration of restructuring”), the measures for the administration of securities issuance of listed companies, and the provisions on Several Issues concerning the regulation of major asset restructuring of listed companies (hereinafter referred to as the “measures”)“ The provisions on certain issues of reorganization (the “provisions”), the detailed rules for the implementation of non-public offering of shares by listed companies and other laws, administrative regulations, departmental rules and other normative documents. After careful self-examination and demonstration of the actual situation and relevant matters of the company, the board of directors of the company believes that the reorganization of the company meets the requirements and conditions specified in the above-mentioned relevant laws, regulations, departmental rules and normative documents.
2、 The proposal on the company issuing shares to purchase assets and raising matching funds and related party transactions was deliberated and adopted item by item (this proposal needs to be submitted to the general meeting of shareholders for deliberation);
The directors attending the meeting reviewed the plan of this transaction item by item, and the main contents are as follows: (I) the overall plan of this transaction
1. The company plans to purchase 100% equity of Construction Engineering Group (hereinafter referred to as “underlying assets”) held by construction engineering holdings by issuing shares.
2. The company plans to raise supporting funds by non-public offering of shares to no more than 35 specific investors, with the total amount of supporting funds raised not exceeding 2 billion yuan, and the number of shares issued not exceeding 30% of the total share capital of the listed company before this transaction, i.e. not exceeding 360678600 shares. After deducting intermediary fees and relevant taxes, the supporting funds raised this time will be used for the construction of projects raised by China Construction Engineering Group or supplement working capital. If the latest regulatory opinions of the securities regulatory authority are adjusted, the listed company may adjust the matters related to the raising of supporting funds accordingly according to the latest regulatory opinions of the relevant securities regulatory authority.
The effectiveness and implementation of the raised matching funds are conditional on the effectiveness and implementation of the purchase of assets by issuing shares, but the successful implementation of the raised matching funds is not a prerequisite for the purchase of assets by issuing shares. The success of the final issuance of the raised matching funds does not affect the implementation of the purchase of assets by issuing shares.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
(II) scheme for purchasing assets by issuing shares this time
1. Counterparty and underlying assets
The counterparty of this issuance of shares to purchase assets is the only shareholder of Construction Engineering Group, namely construction engineering holding.
The underlying asset of this transaction is 100% equity of Construction Engineering Group held by the counterparty.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
2. Pricing basis and transaction price of underlying assets
The final transaction price of the underlying assets of this transaction will refer to the evaluation value specified in the asset evaluation report issued by the asset evaluation institution hired by the listed company in line with the provisions of the securities law and reviewed and filed by the state-owned assets supervision and administration institution, which shall be determined by the parties to the transaction through negotiation. Up to now, the audit and evaluation of the underlying assets of this transaction have not been completed, and the estimated value has not been determined. The final financial data and evaluation results of the underlying assets involved in this transaction will be determined in the formal audit report and evaluation report, and the relevant audit, evaluation data and final transaction price will be disclosed in the restructuring report.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
3. Payment method
The company plans to purchase 100% equity of Construction Engineering Group held by the counterparty by issuing shares.
Result: 1 affirmative vote, 0 abstention vote; The result of the vote was passed.
4. Pricing base date, pricing basis and issue price of issued shares
According to the provisions of the reorganization management measures, the price of shares issued by a listed company shall not be lower than 90% of the market reference price. The market reference price is one of the average trading prices of the company’s shares 20 trading days, 60 trading days or 120 trading days before the announcement date of the resolution of the board of directors to purchase assets by issuing shares this time. The average trading price of the company’s shares on several trading days before the pricing benchmark date = the total trading volume of the company’s shares on several trading days before the pricing benchmark date / the total trading volume of the company’s shares on several trading days before the pricing benchmark date.
The pricing benchmark date of this transaction is the announcement date of the resolution of the first board of directors of the company to consider matters related to this transaction. The issue price is 4.86 yuan / share, which is no less than 90% of the average trading price of the listed company’s shares 120 trading days before the pricing benchmark date. The final issue price shall be examined and approved by the general meeting of shareholders of the listed company and approved by the China Securities Regulatory Commission (hereinafter referred to as “CSRC”).
During the period from the pricing base date to the completion of the issuance, if there are ex rights and ex interests matters such as dividend distribution, share distribution, conversion of capital reserve into share capital, the issuance price will be adjusted in accordance with the relevant provisions of Shenzhen Stock Exchange (hereinafter referred to as “Shenzhen Stock exchange”).
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
5. Issuance method
The way of issuing shares is non-public issuance to specific objects.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
6. Type and par value of issued shares
The type of shares issued this time is domestic listed RMB ordinary shares (A shares), with a par value of 1.00 yuan per share.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
7. Distribution object and quantity
The issuing object of this transaction is construction engineering holdings, which subscribes the consideration shares issued this time with its equity of construction engineering group.
The number of shares issued to the issuing object = the transaction consideration paid to the counterparty in the form of issued shares ÷ the stock issuance price, rounded down to shares, and the part less than one share is included in the capital reserve, which shall be deliberated and approved by the general meeting of shareholders of the listed company and approved by the CSRC.
If the listed company has ex rights and ex interests matters from the pricing benchmark date to the issuance date, such as dividend distribution, share distribution, conversion of capital reserve into share capital, share allotment and so on, the issuance quantity shall be adjusted accordingly in accordance with the relevant provisions of Shenzhen Stock Exchange.
Since the transaction consideration of the underlying assets has not been determined, the number of shares issued to the counterparty in this transaction has not been determined, and the specific number of shares issued will be disclosed in the restructuring report.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
8. Listing arrangement
The shares issued in this transaction will be listed and traded on the Shenzhen Stock Exchange.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
9. Lock up period and lifting arrangement of issued shares
The consideration shares obtained by construction engineering holdings through this purchase of assets shall not be transferred or entrusted to others for management within 36 months from the date of completion of share issuance. Within 6 months after the completion of this restructuring, if the closing price of the shares of the listed company is lower than the issue price for 20 consecutive trading days, or the closing price is lower than the issue price at the end of 6 months after the completion of this restructuring, The lock up period of the above-mentioned shares shall be automatically extended for at least 6 months (if the listed company has ex dividend matters such as dividend distribution, share distribution, conversion of share capital or allotment of shares during the above-mentioned period, the above-mentioned issue price shall be calculated based on the price adjusted by ex dividend, ex right and other factors).
After the completion of this offering, if the shares of the listed company obtained by the counterparty through this transaction are increased due to the dividend distribution, bonus shares, conversion of share capital or allotment of shares of the listed company, the above agreement shall also be observed. After the expiration of the above lock-in period, its transfer and transaction shall be handled in accordance with the laws in force at that time and the rules of Shenzhen Stock Exchange.
If the transaction is filed for investigation by the judicial organ or the CSRC due to the suspected false records, misleading statements or major omissions of the information provided or disclosed, construction engineering holdings will not transfer its shares in the listed company until the conclusion of the case investigation is clear.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
10. Arrangement of accumulated undistributed profits
The accumulated undistributed profits of the company before the completion of this issuance shall be shared by the new and old shareholders of the company after the completion of this issuance.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
11. Profit and loss arrangement in transition period
The period from the base date of audit and evaluation (excluding the date) to the delivery date of the underlying assets (including the date) is the transition period. After the delivery date, the listed company shall employ an accounting firm in accordance with the provisions of the securities law to conduct delivery audit on the profits and losses of the subject assets during the transition period and issue a delivery audit report. The audited profit and loss during the closing period shall prevail.
In addition to the costs and expenses incurred or taxes to be borne due to this major asset restructuring, during the transition period, if the underlying assets achieve profits or the net assets increased due to other reasons, the listed company shall own the part; In case of loss or reduction of net assets due to other reasons, the counterparty shall compensate the listed company with the same amount of cash.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
12. Validity of the resolution
The resolution on the issuance of shares to purchase assets shall be valid within 12 months from the date of deliberation and adoption by the general meeting of shareholders. If the company has obtained the approval document of the CSRC for this transaction within this period, the validity period of the authorization will be automatically extended to the completion date of this reorganization.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
(III) scheme for raising supporting funds by issuing shares this time
1. Type, par value and listing place of issued shares
The shares issued this time are RMB common A shares, with a par value of 1.00 yuan per share, and the listing place is Shenzhen Stock Exchange.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
2. Issuing method, issuing object and subscription method
The matching raised funds are intended to issue shares by non-public offering to no more than 35 specific investors such as securities investment fund management companies, securities companies, trust and investment companies, financial companies, insurance institutional investors, qualified overseas institutional investors, other domestic legal person investors and natural persons in accordance with the provisions of the CSRC. The issuing object shall meet the conditions stipulated by laws and regulations. The issuing objects of the raised matching funds are subscribed in cash. If a securities investment fund management company subscribes with more than two funds under its management, it shall be regarded as an issuing object. The above-mentioned specific objects subscribe for the non-public offering of shares in cash and at the same price.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
3. Pricing method and price of issued shares
(1) Pricing base date
The pricing principle of the supporting funds raised this time is inquiry issuance, and the pricing benchmark date of the supporting funds raised this time is the first day of the issuance period of the supporting funds raised.
(2) Issue price
The issue price shall not be lower than 80% of the average price of the shares of the listed company 20 trading days before the pricing benchmark date of the supporting raised funds. The final issue price will be determined by the board of directors of the listed company through consultation with the independent financial adviser of the transaction in accordance with the authorization of the general meeting of shareholders, the relevant regulatory requirements of the CSRC and the provisions of relevant laws and regulations, and the subscription quotation of the issuing object.
Voting results: 8 in favor, 0 against, 0 abstention and 1 avoidance; The result of the vote was passed.
4. Number of issues
The company plans to raise matching funds by non-public offering of shares to no more than 35 qualified specific investors, and the number of shares issued does not exceed 30% of the total share capital of the company before this transaction, that is, no more than 360678600 shares. After deducting intermediary fees and relevant taxes, the supporting funds raised this time will be used for the construction of projects raised by China Construction Engineering Group or supplement working capital. If the latest regulatory policies or opinions of the securities regulatory authorities are adjusted, the company may adjust the matters related to the raised matching funds accordingly according to the latest regulatory policies or opinions of the relevant securities regulatory authorities.
If the company pays dividends and
