Citic Securities Company Limited(600030)
About Welle Environmental Group Co.Ltd(300190)
Verification opinions on purchasing financial products with idle self owned funds
Citic Securities Company Limited(600030) (hereinafter referred to as ” Citic Securities Company Limited(600030) ” or “sponsor”) as the sponsor of Welle Environmental Group Co.Ltd(300190) (hereinafter referred to as ” Welle Environmental Group Co.Ltd(300190) ” or “company”) to publicly issue convertible corporate bonds in 2020, In accordance with the provisions of relevant laws and regulations such as the measures for the administration of securities issuance and listing recommendation business, the Listing Rules of Shenzhen Stock Exchange on the gem, the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 2 – standardized operation of listed companies on the gem, the matters of Welle Environmental Group Co.Ltd(300190) using idle self owned funds to purchase financial products have been verified. The verification results are as follows:
1、 Specific conditions of using idle self owned funds to purchase principal guaranteed financial products
(I) investment purpose
In order to improve the use efficiency of self owned funds, make rational use of idle self owned funds to increase the company’s income, and use idle self owned funds to purchase financial products without affecting the company’s normal operation and ensuring the safety of funds.
(II) investment quota
Idle self owned funds with a total amount of no more than RMB 250 million. Within the above limit, the funds can be used on a rolling basis, and the total amount of principal guaranteed financial products purchased by the company with idle self owned funds at any time point shall not exceed the above limit. (III) investment type
The company will strictly control risks in accordance with relevant regulations and choose low-risk financial products with high safety, good liquidity and investment period of no more than 12 months, including fixed income or breakeven floating financial products issued by banks and other financial institutions.
(IV) investment period
It shall be valid within 12 months from the date of deliberation and approval by the board of directors.
(V) implementation mode
Sign relevant documents.
(VI) description of association relationship
There is no relationship between the company and the issuer of financial products.
(VII) approval procedures
According to the articles of association and relevant laws and regulations, the investment amount is within the authority of the board of directors of the company, which needs to be reviewed and approved by the board of directors and the board of supervisors, and implemented after the independent directors of the company express special opinions.
(VIII) information disclosure
The company will disclose the specific situation of purchasing financial products in accordance with the relevant requirements of the Shenzhen Stock Exchange GEM Listing Rules, Shenzhen Stock Exchange listed companies self regulatory guidance No. 2 – standardized operation of GEM listed companies and so on.
2、 Investment risk and risk control measures
(I) investment risk
Although the fixed income or breakeven floating financial products issued by financial institutions belong to low-risk investment varieties, the financial market is greatly affected by the macro economy. The company will intervene appropriately according to the economic situation and changes in the financial market, but it does not rule out the impact of market fluctuations on the above projects.
(II) risk control measures
1. When the company conducts cash management of its own funds, it will choose the opportunity to buy investment products with good liquidity and high security, provide breakeven commitment and investment period of no more than 12 months, and clarify the amount, period, investment varieties, rights, obligations and legal liabilities of both parties.
2. Relevant personnel of the Finance Department of the company will analyze and track the progress in time. If risk factors that may affect the safety of the company’s funds are found in the assessment, corresponding measures will be taken in time to control the investment risk.
3. The internal audit department of the company is responsible for internal supervision and regularly conduct comprehensive inspection on the invested financial products.
4. The independent directors and supervisors of the company have the right to conduct regular or irregular inspection on the situation of their investment products, and can hire professional institutions to audit when necessary.
5. The company will do a good job of relevant information disclosure in accordance with the relevant provisions of Shenzhen Stock Exchange.
3、 Impact on the daily operation of the company
Under the condition of ensuring that it will not affect the normal implementation of the company’s projects and the company’s normal operation, the company plans to use some idle self owned funds to purchase principal guaranteed financial products with high safety and good liquidity, which will not affect the development of the company’s daily business, and will be conducive to improving the utilization efficiency of self owned funds, achieving good investment return, increasing the company’s cash asset income, further improving the overall performance level of the company and fully protecting the interests of shareholders.
4、 Decision making procedures for the implementation of this matter and opinions of relevant institutions
(I) deliberations of the board of directors
The 23rd Meeting of the 4th board of directors of the company deliberated and approved the proposal on using idle self owned funds to purchase financial products, and agreed that the company should use idle self owned funds with a maximum amount of no more than RMB 250 million to purchase principal guaranteed financial products with high safety and good liquidity.
(II) opinions of the board of supervisors
The 15th meeting of the 4th board of supervisors of the company deliberated and approved the proposal on using idle self owned funds to purchase financial products. The board of supervisors held that the company’s use of idle self owned funds to purchase principal guaranteed financial products with high safety and good liquidity will not affect the development of the company’s daily business, improve the use efficiency of idle self owned funds and obtain certain investment income, Therefore, the company agrees to use idle self owned funds to purchase financial products.
(III) opinions of independent directors
The independent directors believe that the decision-making procedure of using idle self owned funds to purchase principal guaranteed financial products with high safety and good liquidity complies with relevant regulations, has fulfilled the specified procedures, and complies with the relevant laws, regulations and normative documents such as the Listing Rules of GEM stocks of Shenzhen Stock Exchange, the self regulatory guidelines for listed companies of Shenzhen Stock Exchange No. 2 – standardized operation of GEM listed companies, On the basis of ensuring the normal operation and capital safety of the company, the company uses some idle self owned funds to invest in principal guaranteed financial products with high safety and liquidity, which is conducive to improving the efficiency of capital use and increasing the investment income of the company, which is in line with the interests of the company and all shareholders. Therefore, I agree to the above matters.
5、 Verification opinions of the recommendation institution
Citic Securities Company Limited(600030) consulted the resolutions of the board of directors, the resolutions of the board of supervisors, the opinions of independent directors and other relevant documents related to the purchase of financial products with idle self owned funds by Welle Environmental Group Co.Ltd(300190) this time. After verification, it is considered that:
Welle Environmental Group Co.Ltd(300190) the purchase of financial products with idle self owned funds of no more than RMB 250 million has been deliberated and adopted at the 23rd Meeting of the Fourth Board of directors and the 15th meeting of the Fourth Board of supervisors, and Welle Environmental Group Co.Ltd(300190) all independent directors have expressed their clear consent. The matter complies with relevant laws and regulations such as the Shenzhen Stock Exchange GEM Listing Rules, the Shenzhen Stock Exchange listed companies self regulatory guidelines No. 2 – standardized operation of GEM listed companies and the relevant provisions of the articles of association, which is conducive to improving the efficiency of capital use, increasing the company’s investment income and in line with the interests of the company and all shareholders.
Therefore, the sponsor agrees to Welle Environmental Group Co.Ltd(300190) use idle self owned funds to purchase financial products this time.
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(there is no text on this page, which is the signature and seal page of Citic Securities Company Limited(600030) verification opinions on Welle Environmental Group Co.Ltd(300190) using idle self owned funds to purchase financial products)
Sponsor representative:
Yang Ling, Wang Qiaoqiao
Citic Securities Company Limited(600030) April 15, 2022
