China International Capital Corporation Limited(601995)
About Tianshui Zhongxing Bio-Technology Co.Ltd(002772)
Verification opinions on the settlement of some investment projects with raised funds and the permanent supplement of surplus raised funds to working capital
China International Capital Corporation Limited(601995) (hereinafter referred to as ” China International Capital Corporation Limited(601995) ” or “sponsor”) as a sponsor of Tianshui Zhongxing Bio-Technology Co.Ltd(002772) (hereinafter referred to as ” Tianshui Zhongxing Bio-Technology Co.Ltd(002772) ” or “company”) for continuous supervision of public issuance of convertible corporate bonds, in accordance with the administrative measures for securities Issuance and listing sponsor business and the stock listing rules of Shenzhen Stock Exchange In accordance with the provisions of relevant laws, regulations and normative documents such as the guidelines for self discipline supervision of listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board, we have carefully verified the closing of Tianshui Zhongxing Bio-Technology Co.Ltd(002772) some investment projects with raised funds and the permanent supplement of surplus raised funds to working capital, and expressed the following opinions:
1、 Overview of changes in investment projects with raised funds
(I) receipt of raised funds
With the approval of the reply on approving Tianshui Zhongxing Bio-Technology Co.Ltd(002772) public issuance of convertible corporate bonds (zjxk [2017] No. 2002) issued by the China Securities Regulatory Commission, the company publicly issued 9.2 million convertible corporate bonds on December 13, 2017, with a face value of 100 yuan each, issued at par, and raised a total of 92 million yuan. After deducting the issuance expenses, the net amount of funds actually raised was 902.9 million yuan. The above funds have been verified by Zhongshen Zhonghuan Certified Public Accountants (special general partnership) and issued the capital verification report (zhyz (2017) No. 080011). (II) management and use of raised funds
1. Deposit and management of raised funds
In order to standardize the management and use of the raised funds and protect the legitimate rights and interests of investors, the company has formulated the measures for the administration of Tianshui Zhongxing Bio-Technology Co.Ltd(002772) raised funds in accordance with the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of the raised funds of listed companies and the measures for the administration of Tianshui Zhongxing Bio-Technology Co.Ltd(002772) raised funds handed over by Shenzhen securities The management and supervision of raised funds and information disclosure are strictly regulated.
On December 19, 2017, the second meeting of the 38th board of directors on opening convertible accounts of the company reviewed and approved the proposal on opening convertible accounts of the company. The company, its subsidiaries, the sponsor and the raised funds storage bank have signed the raised funds supervision agreement, and the opening and storage of the company’s special raised funds account are as follows:
Unit: 10000 yuan
Sequence item name deposit bank account name bank account number amount
number
Annual output of 20000 tons of Agaricus bisporus Bank Of Communications Co.Ltd(601328)
1 mushroom and 110000 ton compost Co., Ltd. Anyang Tianshui Zhongxing Bio-Technology Co.Ltd(002772) 72903012801801004229000 factory production project company Tianshui Technology Co., Ltd. 68657
branch
Annual output of 32400 tons of golden needle Gansu Bank Jilin Zhongxing bacteria 6101240020001365
2 mushroom production line construction project Tianshui Industry Technology Co., Ltd. 02400000 company
Annual output of 32400 tons of gold needle Bank Of Communications Co.Ltd(601328)
3. Mushroom industrialized circular economy Co., Ltd. Wuwei Tianshui Zhongxing Bio-Technology Co.Ltd(002772) 72903011001801012400000 industrial chain construction project company Tianshui Technology Co., Ltd. 12000
branch
Total 9029000
2. Use of raised funds
The first extraordinary general meeting of the company in 2018, the annual general meeting of shareholders in 2018 and the first extraordinary general meeting of shareholders in 2020 all considered and approved the proposal of using some idle raised funds for cash management. Under the condition of ensuring that the investment projects of the company’s raised funds will not be affected, some idle raised funds will be managed in cash to improve the use efficiency of raised funds.
On January 12, 2018, the company held the 40th meeting of the second board of directors and the 28th meeting of the second board of supervisors, deliberated and approved the proposal on using the raised funds to replace the self raised funds of the pre invested projects. The board of directors agreed that the company would use the raised funds of 30484613632 yuan to replace the pre invested “20000 tons of Agaricus bisporus and 110000 tons of compost industrialized production project” “Production line construction project with annual output of 32400 tons of Flammulina velutipes” and “industrial chain construction project with annual output of 32400 tons of industrialized circular economy of Flammulina velutipes”
On September 22, 2020, the company held the 34th meeting of the third board of directors and the third board of supervisors
The 20th meeting deliberated and adopted the proposal on changing the special account for raised funds. To optimize fund-raising
Under the management of Jin, the company changed the “factory production project with an annual output of 20000 tons of Agaricus bisporus and 110000 tons of compost” and
“32400 tons of Flammulina velutipes annual output industrialized circular economy industrial chain construction project” is stored in the bank. company
The supervision agreement on raised funds was re signed with the sponsor and the changed storage bank, Bank of Gansu.
(III) cumulative investment of raised funds
As of March 21, 2022, the use and savings of funds raised by convertible corporate bonds of the company are as follows: unit: 10000 yuan
Sequence commitment as of 2022, the investment amount of the implementation subject of Project No. investment project is calculated according to the balance of the accumulated interest income account on March 21
Annual output of 20000 tons of Agaricus bisporus Anyang Tianshui Zhongxing Bio-Technology Co.Ltd(002772) branch
1 mushroom and 110000 ton Composting Technology Co., Ltd. 422900032068522020531224201 put into factory production project
2. Jilin Tianshui Zhongxing Bio-Technology Co.Ltd(002772) 24 China Vanke Co.Ltd(000002) 78587 748.982196311 Zhonggu production line construction project technology Co., Ltd. with an annual output of 32400 tons of gold needle
Annual output of 32400 tons of gold needle Wuwei Tianshui Zhongxing Bio-Technology Co.Ltd(002772) branch
3. Industrial chain construction project invested by mushroom industrialized circular economy production technology Co., Ltd. 24 China Vanke Co.Ltd(000002) 053094108009454915
3827003860904
meter
2、 Closing and permanent replenishment of working capital of some investment projects with raised funds
Anyang Zhongxing’s “factory production project with an annual output of 20000 tons of Agaricus bisporus and 110000 tons of compost” has been completed in 2019
It was completed and put into operation in March, and the industrial chain of industrialized circular economy with an annual output of 32400 tons of Flammulina velutipes was built in Zhongxing, Wuwei
The project has been put into operation in August 2019.
Jilin Zhongxing “annual output of 32400 tons of Flammulina velutipes production line construction
The “project” is under construction. Due to its location in Northeast China, the annual effective construction time is relatively short, and
The repetition of the situation has a great impact on the overall construction progress. In 2021, the whole edible fungus industry was relatively depressed, and the public
The company will continue to pay attention to the industry trends and timely analyze and demonstrate the feasibility of the project.
(I) reasons for savings of raised funds
Through fine management, the company further strengthens project management and cost control, makes full use of resources and
Based on the actual situation of the project and without affecting the smooth implementation and completion of the project invested with raised funds
Each link of the investment project is optimized to save the project investment. At the same time, in order to improve the use efficiency of the raised funds during the implementation of the raised investment project, the company used some temporarily idle raised funds for cash management on the premise of ensuring that the normal progress of the investment plan of the raised funds was not affected, and obtained more investment income. (II) use plan of surplus raised funds
The company’s “20000 ton / year Agaricus bisporus and 110000 ton compost industrialized production project” implemented by Anyang Zhongxing and the “32400 ton / year Flammulina velutipes industrialized circular economy industrial chain construction project” implemented by Wuwei Zhongxing have been completed and put into operation. In order to give full play to the use efficiency of the raised funds, create greater benefits for the company and all shareholders, and meet the demand for working capital for the growth of the company’s main business in the future, To promote the follow-up operation and long-term development of the company, the company plans to raise 167911600 yuan of surplus funds after the completion of the above-mentioned raised investment projects (including interest and unpaid project balance of 5.047 million yuan / quality assurance deposit, and the actual amount shall be subject to the balance of the special account on the day of fund transfer out) Permanently replenish working capital for the company’s daily operation and business development. After the funds are transferred out, the raised funds of “20000 tons of Agaricus bisporus and 110000 tons of compost industrialized production project” and “32400 tons of Flammulina velutipes industrialized circular economy industrial chain construction project” are all used up, and the company will cancel the special account for the raised funds. After the cancellation of the special account, the supervision agreement on raised funds signed by the company and its subsidiaries with the sponsor and the deposit bank shall be terminated accordingly. The unpaid balance of 5.047 million yuan / quality guarantee deposit in the raised investment project will be paid from the basic account of the company according to the contract.
3、 Impact of permanent replenishment of working capital with surplus raised funds and relevant explanations
The company uses the surplus raised funds of some projects to permanently supplement the working capital, which will help to improve the use efficiency of raised funds, reduce financial expenses, improve the operating efficiency of the company, and maximize the interests of the company and shareholders. There is no change or disguised change in the investment direction of the raised funds, and there is no violation of the relevant provisions on the use of the raised funds stipulated in laws, regulations and normative documents.
4、 Approval procedures for the closing of some investment projects with raised funds and permanent replenishment of working capital
On March 23, 2022, the company held the 12th meeting of the 4th board of directors and the 6th meeting of the 4th board of supervisors, deliberated and adopted the proposal on closing some investment projects with raised funds and permanently supplementing the surplus raised funds with working capital. The board of directors agreed to conclude the “industrialized production project of Agaricus bisporus with an annual output of 20000 tons and 110000 tons of compost” and the “industrialized circular economy industrial chain construction project of Flammulina velutipes with an annual output of 32400 tons”. At the same time, in order to improve the use efficiency of the raised funds and in combination with the actual operation of the company, it is agreed to raise 167911600 yuan of the surplus raised funds after the completion of the above-mentioned raised investment projects (including interest and unpaid project balance / quality assurance deposit of 5.047 million yuan, and the actual amount shall be subject to the balance of the special account on the day the funds are transferred out.) Permanent supplementary working capital accounts for 18.60% of the net funds raised by the company’s public issuance of convertible corporate bonds. This change does not constitute a connected transaction. According to the relevant provisions of the stock listing rules of Shenzhen Stock Exchange and the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board, this matter needs to be submitted to the general meeting of shareholders of the company for deliberation.
(I) opinions of independent directors
The independent directors believe that the closing of some of the company’s investment projects with raised funds and the permanent supplement of the surplus raised funds to the working capital are in line with the development reality of the company, conducive to improving the use efficiency of raised funds and reducing financial expenses, which is in line with the interests of all shareholders. There is no situation of changing the investment direction of raised funds in a disguised manner and damaging the interests of the company and all shareholders, and its deliberation procedure is legal and effective. Therefore, we agree to conclude the “industrialized production project with an annual output of 20000 tons of Agaricus bisporus and 110000 tons of compost” and the “industrialized circular economy industrial chain construction project with an annual output of 32400 tons of Flammulina velutipes”, and permanently supplement the surplus funds with working capital.
(II) opinions of the board of supervisors
The board of supervisors believes that the closing of some of the company’s investment projects with raised funds and the permanent supplement of working capital with the surplus raised funds for the production and operation activities related to the company’s main business will help to improve the use efficiency of raised funds and reduce financial expenses, which is in line with the interests of the company and all shareholders.
5、 Verification opinions of the recommendation institution
After verification, the recommendation structure believes that: the closing of some of the company’s investment projects with raised funds and the permanent replenishment of working capital with the surplus raised funds have been deliberated and approved by the board of directors and the board of supervisors of the company, the independent directors have issued clear consent opinions, fulfilled the necessary approval procedures, and complied with the stock listing rules of Shenzhen Stock Exchange Relevant provisions such as self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board and regulatory guidelines for listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies.
In conclusion, the recommendation institution has no objection to the settlement of some investment projects with raised funds and the permanent supplement of working capital with the surplus raised funds, which needs to be submitted to the general meeting of shareholders of the company for deliberation.
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