About Wuxi Autowell Technology Co.Ltd(688516)
Application documents for issuing shares to specific objects
Reply to the inquiry letter of the second round of audit
Sponsor (lead underwriter)
(floor 22-25, block B, Ping An financial center, No. 5023, Yitian Road, Futian street, Futian District, Shenzhen) April 2002
Shanghai Stock Exchange:
We have received the reply to the second round of examination and inquiry letter on the application documents of Wuxi Autowell Technology Co.Ltd(688516) issuing shares to specific objects (szkss (refinancing) [2022] No. 17) (hereinafter referred to as "the second round of inquiry letter") issued by your exchange on January 22, 2022 Wuxi Autowell Technology Co.Ltd(688516) (hereinafter referred to as " Wuxi Autowell Technology Co.Ltd(688516) ", "issuer", "company") and Ping An Securities Co., Ltd. (hereinafter referred to as "sponsor"), Guohao law firm (Shanghai) (hereinafter referred to as "issuer's lawyer") and other relevant parties have checked the questions listed in the second round of inquiry letter item by item, and now the reply is as follows, please review.
Unless otherwise specified, the abbreviation used in this reply has the same meaning as that in the prospectus for offering A-Shares to specific objects in Wuxi Autowell Technology Co.Ltd(688516) 2021 (hereinafter referred to as the "prospectus"). If the total value is inconsistent with the mantissa of the sum of the itemized values, it is caused by rounding.
Font interpretation
Questions listed in the inquiry letter in bold
Song typeface (not bold) reply to the inquiry letter and verification opinions of the intermediary
Amendment and supplement to the disclosure of the prospectus in italics (BOLD)
Question 1: about the issuance plan
According to the inquiry reply, the 550 million yuan Ge Zhiyong used to subscribe for the shares issued came from the loans of natural persons Zhang Hong and Wang Huaiqian, of which Zhang Hong is the spouse of Lin Jianhua, the actual controller of Hangzhou First Applied Material Co.Ltd(603806) ( Hangzhou First Applied Material Co.Ltd(603806) . SH), and Wang Huaiqian is the actual controller of century Zhiyuan investment company. The two parties have signed a loan intention agreement with an agreed term of 24 months and can be extended for 12 months. The interest rate is 9% annualized (simple interest), and there is no need to provide guarantee. In addition, the issue price is 70.39 yuan / share, and the closing price of the company's shares is 245.72 yuan / share as of December 31, 2021, which is far from the issue price.
Please explain to the issuer: (1) whether Zhang Hong and Wang Huaiqian are the final lending entities of this loan, whether they have internal division arrangements on the loan amount, and the legitimacy and compliance of the source of funds; (2) Combined with the agreed contents of the intention agreement between the two parties, Ge Zhiyong's capital strength and the fluctuation of the company's share price, this paper further discusses the commercial rationality of Zhang Hong and Wang Huaiqian lending large amounts of funds to ge Zhiyong to subscribe for the shares issued this time, and whether there are other interest arrangements.
The issuer is requested to disclose: (1) the source of Ge Zhiyong's subscription funds and whether there is any external raising, holding on behalf, structured arrangement or indirect use of the funds of the issuer and its related parties for this subscription; (2) The lender shall promise and disclose in the prospectus to understand the purpose of the loaned funds. The loaned funds are indeed loans, and perform relevant agreements according to the term and interest agreed in the loan agreement. There is no agency or other interest arrangement with the borrower and its controlled related parties; (3) The borrower shall promise and disclose in the prospectus that the loan fund is indeed a loan, and there is no holding, compensation, promised income or other interest arrangement between himself and his controlled related parties and the lender.
The sponsor and the issuer's lawyers are requested to check and express clear opinions in accordance with question 10 of the answers to some questions on refinancing business.
reply:
1、 Issuer description
1-1-1: whether Zhang Hong and Wang Huaiqian are the final lending entities of this loan, whether they have internal division arrangements on the loan amount, and the legitimacy and compliance of the source of funds;
According to the documents issued by Zhang Hong and Wang Huaiqian, they are the final lending entities of their respective loans; The two are friends, and there is no related relationship defined in the Listing Rules of science and Innovation Board of Shanghai Stock Exchange; The total amount of funds lent by the two persons this time is no more than RMB 550 million and no less than the subscription funds required for the registration and consent of the CSRC to issue shares, of which Zhang Hong plans to lend 500 million yuan to 530 million yuan and Wang Huaiqian plans to lend 20 million yuan to 50 million yuan. The final amount of each loan shall be determined by the two persons through negotiation with Ge Zhiyong within the above scope and in the formal loan agreement signed; The source of funds lent by the two persons is their own funds accumulated by means of operation and investment, and they have provided asset certificates such as deposits, private securities investment funds or financial products with a total of more than 550 million yuan, and promised that the source of funds is legal and compliant.
Among them, according to the documents issued by Zhang Hong and his spouse, the loan fund of Zhang Hong belongs to the joint property of Zhang Hong and his spouse, and the loan provided by Zhang Hong to ge Zhiyong has been agreed by Zhang Hong's spouse.
1-1-2: further discuss the commercial rationality of Zhang Hong and Wang Huaiqian lending large amount of funds to ge Zhiyong to subscribe for the shares issued this time, and whether there are other interest arrangements, in combination with the agreed contents of the intention agreement between the two parties, Ge Zhiyong's capital strength and the fluctuation of the company's share price.
(I) the loan income of Zhang Hong and Wang Huaiqian is at a high level due to unsecured
According to the loan cooperation intention agreement, the loan income of Zhang Hong and Wang Huaiqian is fixed income. The calculation method is: loan income = the actual contribution amount of Zhang Hong and Wang Huaiqian 9% (actual days of use / 360).
According to the announcement of the national interbank lending center authorized by the people's Bank of China, the quoted interest rate (LPR) of the loan market on April 15, 2022: 1-year LPR is 3.7%, and more than 5-year LPR is 4.6%.
The borrowing period is between 1-5 years. Because the borrower Ge Zhiyong does not provide guarantee, the lender will bear credit risk and obtain relatively high fixed income (annualized simple interest of 9%), which is reasonable.
(II) the borrower's real market value is relatively low, and Ge Zhiyong mainly bears risks in the current market
Ge Zhiyong is one of the actual controllers of Wuxi Autowell Technology Co.Ltd(688516) Wuxi Autowell Technology Co.Ltd(688516) is mainly engaged in the R & D, design, production and sales of high-end intelligent equipment. Its products are used in photovoltaic, lithium battery, semiconductor sealing and testing and other industries, which have a large development space. Benefiting from the stable development of downstream industries, especially photovoltaic industry, and the improvement of the competitiveness of its main products, Wuxi Autowell Technology Co.Ltd(688516) currently operates well.
According to its 2021 annual report, Wuxi Autowell Technology Co.Ltd(688516) 2021 from January to December, the net profit attributable to the shareholders of the listed company was 371 million yuan, with a year-on-year increase of 138.63%.
Ge Zhiyong's main asset is the stock of Wuxi Autowell Technology Co.Ltd(688516) . Before this offering, Ge Zhiyong directly held 21102450 shares of the company. All the funds Ge Zhiyong borrowed this time are used to subscribe for the shares issued by Wuxi Autowell Technology Co.Ltd(688516) and he plans to subscribe for no more than 7813609 shares. According to the maximum issuance and 20 transactions before April 15, 2022, RMB 6.097 billion.
Therefore, despite the risk of sharp fluctuations in the stock price, considering Wuxi Autowell Technology Co.Ltd(688516) good operating conditions and Ge Zhiyong's high market value of the shares held by Wuxi Autowell Technology Co.Ltd(688516) as one of the actual controllers, Zhang Hong and Wang Huaiqian still have a high margin of safety for the repayment of the principal and interest of this loan, and their real risk of this loan is low. To sum up, Zhang Hong and Wang Huaiqian can obtain higher fixed income by lending large amount of funds to ge Zhiyong. Although Ge Zhiyong does not directly guarantee the loan, considering that GE Zhiyong is one of the actual controllers of Wuxi Autowell Technology Co.Ltd(688516) and the high market value of their shares after the issuance, as well as Wuxi Autowell Technology Co.Ltd(688516) current good operating conditions and other factors, the real risk borne by the lender is low. Therefore, Zhang Hong The first two of Wang Huai believed that the large amount of funds lent to ge Zhiyong to subscribe for the shares issued this time was a good investment opportunity and commercially reasonable.
As confirmed by the lenders Zhang Hong, Wang Huaiqian and the borrower Ge Zhiyong, there is no interest arrangement other than the loan cooperation intention agreement and its supplementary agreement.
2、 Issuer disclosure
1-2-1: the source of Ge Zhiyong's subscription funds, whether there is external raising, holding on behalf, structured arrangement or indirect use of the funds of the issuer and its related parties for this subscription
The company has supplemented and disclosed the following in "II. Issuing objects and their relationship with the company" in "section II summary of this securities issuance" of the prospectus:
(IV) issuing object and source of funds
Ge Zhiyong's capital source for this subscription is loan, and there is no external raising, holding on behalf, structured arrangement or indirect use of the company's and its related party's funds other than Ge Zhiyong for this subscription.
1-2-2: the lender is requested to make a commitment and disclose it in the prospectus to understand the purpose of the loaned funds. The loaned funds are indeed loans, and perform relevant agreements according to the term and interest agreed in the loan agreement. There is no agency or other interest arrangement with the borrower and its controlled related parties
The company has supplemented and disclosed the following in "II. Issuing objects and their relationship with the company" in "section II summary of this securities issuance" of the prospectus:
(IV) issuing object and source of funds
……
Zhang Hong and Wang Huaiqian, the lenders of the subscription fund, promise that they understand the purpose of the loan fund, that is, Ge Zhiyong will use it to subscribe for the shares issued by Wuxi Autowell Technology Co.Ltd(688516) company; The loan is indeed a loan. I will perform the relevant agreements in accordance with the term and interest rate agreed in the loan cooperation intention agreement and the supplementary agreement to the loan cooperation intention agreement, that is, the term is 24 months and can be extended for 12 months with my consent, and the interest is 9% (simple interest) of the total loan. Ge Zhiyong and his related parties have no interest in the arrangement. I am willing to accept relevant supervision and inspection on the above commitments. If I violate the above commitments, the relevant income corresponding to the illegal part will belong to Wuxi Autowell Technology Co.Ltd(688516) all.
1-2-3: the borrower shall promise and disclose in the prospectus that the loan fund is indeed a loan, and there are no holding, compensation, promised income or other interest arrangements between himself and his controlled related parties and the lender
The company has supplemented and disclosed the following in "II. Issuing objects and their relationship with the company" in "section II summary of this securities issuance" of the prospectus:
(IV) issuing object and source of funds
……
Ge Zhiyong, the object of this issuance, promises that the loan fund is indeed a loan, and there are no holding, compensation, promised income or other interest arrangements between myself and the related parties under my control and the lender. I am willing to accept relevant supervision and inspection on the above commitments in the future. In case of violation of the above commitments, the relevant income corresponding to the illegal part shall be owned by the listed company. 3、 Intermediary verification
1-3-1: the sponsor and the issuer's lawyers are requested to check and express clear opinions in accordance with question 10 of the answers to some questions on refinancing business.
(I) verification procedure
The sponsor and the issuer's lawyers have performed the following main verification procedures:
1. Refer to the loan cooperation intention agreement and its supplementary agreement, the lender's checklist and its asset certificate, and Ge Zhiyong's checklist.
2. Interview the fund lender on matters related to the loan, and obtain the commitment of the fund lender that the specific source of funds lent in the future is legal and compliant, and there is no drawer agreement in any form, such as explicit debt, real shares, holding on behalf of others, excess income distribution, etc. Obtain the commitment issued by GE Zhiyong on the legality and compliance of the source of loan funds and the absence of other interest arrangements.
3. Obtain and check the supplementary commitments issued by the capital lenders Zhang Hong and Wang Huaiqian and the issuing object Ge Zhiyong on matters such as the source of capital really belongs to the loan.
4. Obtain the commitment issued by Li Wen, one of the issuer and actual controller, that there is no financial assistance, compensation, promised income or other agreement arrangements directly or through its stakeholders to ge Zhiyong, the subscription object. (II) verification opinions
After verification, the sponsor and the issuer's lawyer believe that:
1. The issuing object Ge Zhiyong's funds come from the loan, which is the self owned funds of the borrowers Zhang Hong and Wang Huaiqian.
2. The source of funds of Ge Zhiyong, the issuing object, does not exist the situation of external raising, holding on behalf of others, structured arrangement or direct or indirect use of the funds of the issuer and its related parties for this subscription.
3. Li Wen, the issuer and one of the actual controllers, does not provide financial assistance, compensation, promised income or other agreement arrangements directly or through its stakeholders to ge Zhiyong, the subscription object.
4. The issuer's information disclosure on the source of funds of the issuing object is true, accurate and complete, which can effectively safeguard the legitimate rights and interests of the company and minority shareholders, and comply with the relevant provisions of the CSRC.
5. The issuer has provided the relevant commitments issued by the borrower, lender and related parties involved in this issuance as an annex for future reference.
Attachment: general opinions of the sponsor
The sponsor has checked and confirmed the company's reply in this reply material to ensure its authenticity, completeness and accuracy.
(there is no text on this page, which is the seal page of the reply to the second round of examination and inquiry on Wuxi Autowell Technology Co.Ltd(688516) the application documents for issuing shares to specific objects)
Wuxi Autowell Technology Co.Ltd(688516) mm / DD / yyyy
Statement of the chairman of the issuer
I have carefully read all the contents of Wuxi Autowell Technology Co.Ltd(688516) this inquiry letter and confirm that the contents of the reply report are true, accurate and complete, and there are no false records, misleading statements or major omissions. Legal representative and chairman of the issuer:
Ge Zhiyong
Wuxi Autowell Technology Co.Ltd(688516) mm / DD / yyyy (there is no text on this page, which is about Wuxi Autowell Technology Co.Ltd(688516) issuing shares to specific objects
