Huadian Heavy Industries Co.Ltd(601226)
Prior approval and independent opinions of independent directors on the matters considered at the sixth meeting of the Fourth Board of directors
In accordance with laws, regulations and normative documents such as the rules for independent directors of listed companies, the guidelines for the governance of listed companies, the rules for the listing of shares on the Shanghai Stock Exchange, the guidelines for the self discipline supervision of listed companies on the Shanghai Stock Exchange No. 1 - standardized operation, as well as Huadian Heavy Industries Co.Ltd(601226) (hereinafter referred to as " Huadian Heavy Industries Co.Ltd(601226) " or "the company"), the articles of association, the working system of independent directors and other relevant provisions, As an independent director of Huadian Heavy Industries Co.Ltd(601226) the Fourth Board of directors, we have given prior approval and independent opinions on the relevant matters considered at the sixth meeting of the Fourth Board of directors held on April 21, 2022, as follows:
1、 Independent opinions on the company's profit distribution plan in 2021
The profit distribution plan for 2021 proposed by the board of directors takes into account the current operating conditions, capital needs and future development of the company, complies with the profit distribution policies specified in the articles of association and the relevant provisions of laws and regulations, and is conducive to the sustainable, stable and healthy development of the company without the intervention and cash out of major shareholders and damaging the interests of shareholders, especially small and medium-sized shareholders, It is agreed to submit the company's profit distribution plan for 2021 to the company's 2021 annual general meeting for deliberation.
2、 Independent opinions on the internal control evaluation report of the company in 2021
According to the relevant requirements of China Securities Regulatory Commission, Shanghai Stock Exchange and other regulatory authorities on the internal control of listed companies, as well as the relevant normative documents such as the basic norms of enterprise internal control and the supporting guidelines for enterprise internal control, combined with its own actual characteristics and conditions, the company evaluated the operation and effectiveness of internal control in 2021 on the basis of daily and special supervision of internal control.
The company has established a relatively perfect internal control system in accordance with the basic norms of enterprise internal control, supporting guidelines for enterprise internal control and other relevant normative documents, and the key activities of internal control are carried out in accordance with the provisions of various internal control systems. During the reporting period, the company had no major defects in internal control, and there were no factors affecting the evaluation conclusion of the effectiveness of internal control. The company has maintained effective internal control in all major aspects in accordance with the requirements of the enterprise internal control standard system and relevant regulations. Therefore, we believe that the evaluation of the company's internal control is comprehensive, true and accurate, reflecting the actual situation of the company's internal control.
3、 Independent opinions on the remuneration of senior managers of the company in 2021
On April 11, 2022, the nomination and Remuneration Committee of the Fourth Board of directors of the company held the fourth interim meeting to assess the work and operating performance of the company's senior managers in 2021. After verification, we believe that the formulation and decision-making procedures of the company's senior management salary in 2021 comply with the provisions of the articles of association, senior management salary management measures and other relevant rules and regulations, and the assessment results and payment are objective and fair, in line with the actual situation of the company. We agree to cash the senior management salary in accordance with the proposal on the company's senior management salary in 2021.
4、 Prior approval and independent opinions on the implementation of the company's daily connected transactions in 2021 and the forecast of daily connected transactions in 2022
We have reviewed the implementation of the company's daily related party transactions in 2021 and the expected related matters of the company's daily related party transactions in 2022, and agreed to submit relevant proposals to the sixth meeting of the Fourth Board of directors for deliberation.
After carefully reading the relevant materials provided by the company, we believe that the daily related party transactions actually occurred in 2021 and 2022 are expected to be conducive to the stability of the company's production and operation, and can realize complementary advantages and rational allocation of resources. Related party transactions follow the commercial principles of compensation, fairness and voluntariness. The transaction contents and deliberation procedures are legal and compliant, and the transaction pricing is fair, which is conducive to the production, operation and long-term development of the company, will not adversely affect the current and future financial status and operating results of the company, and will not damage the interests of the company and other shareholders. It is agreed to submit relevant proposals to the 2021 annual general meeting of shareholders of the company for deliberation.
5、 Prior approval and independent opinions on employing the company's audit institution and internal control audit institution in 2022
We conducted a pre audit on the matters related to the engagement of the company's audit institution and internal control audit institution in 2022 and agreed to submit the relevant proposals to the sixth meeting of the Fourth Board of directors for deliberation.
Through reviewing the proposal on employing the company's audit institution and internal control audit institution in 2022 and relevant materials, we believe that Tianzhi International Certified Public Accountants (special general partnership) (hereinafter referred to as "Tianzhi international") has the qualification to engage in accounting statement audit and internal control audit of securities and futures related businesses, has many years of experience and ability to provide audit services for listed companies, and has institutional independence, Its listed company's statement audit performance and brand are good, and the audit fee is reasonable. The company's review procedures for hiring the 2022 audit institution and internal control audit institution are legal and compliant. It agrees to hire Tianzhi international to provide the company with financial audit and internal control audit services in 2022, and agrees to submit relevant proposals to the 2021 annual general meeting of shareholders of the company for review.
6、 Independent opinions on cash management of some temporarily idle raised funds
(I) the decision-making procedures for the company to use some temporarily idle raised funds for cash management comply with the relevant provisions of the China Securities Regulatory Commission, such as the guidelines for the supervision of listed companies No. 2 - regulatory requirements for the management and use of raised funds by listed companies, the guidelines for the self discipline supervision of listed companies on Shanghai Stock Exchange No. 1 - standardized operation, and the articles of association of the company.
(II) under the condition of ensuring that the investment and construction of the raised funds and the use of the raised funds are not affected, the company will carry out cash management on the temporarily idle raised funds with a maximum amount of no more than 500 million yuan according to the schedule of the raised investment project and the capital investment plan, and timely purchase cash management products such as bank structured deposits, which will help to improve the cash management income of the idle raised funds and will not affect the normal development of the company's main business, It will not affect the normal progress of the investment plan of the raised funds, and there will be no direct or disguised change in the purpose of the raised funds, and will not damage the interests of the company and all shareholders, especially the minority shareholders.
In conclusion, we agree with the proposal on cash management of some temporarily idle raised funds considered at the sixth meeting of the Fourth Board of directors of the company.
7、 Independent opinions on temporarily replenishing working capital with some idle raised funds
(I) the decision-making procedures for the company to use idle raised funds to temporarily supplement working capital comply with the relevant provisions of the guidelines for the supervision of listed companies No. 2 - regulatory requirements for the management and use of raised funds by listed companies, the guidelines for the self discipline supervision of listed companies on Shanghai Stock Exchange No. 1 - standardized operation and the articles of association of the company.
(II) under the condition of ensuring that the investment and construction of the raised funds and the use of the raised funds are not affected, the company uses the idle raised funds of 150 million yuan to temporarily supplement the working capital according to the progress arrangement of the raised investment project and the capital investment plan, which is conducive to maximizing the interests of shareholders, improving the use efficiency of the idle raised funds, not affecting the normal development of the company's main business and the normal progress of the investment plan of the raised funds, There is no direct or disguised change in the purpose of the raised funds, which will not damage the interests of the company and all shareholders, especially minority shareholders.
To sum up, we agree with the proposal on using some idle raised funds to temporarily supplement working capital considered at the sixth meeting of the Fourth Board of directors of the company.
8、 Prior approval and independent opinions on signing the financial service agreement with China Huadian Group Finance Co., Ltd
We have reviewed the financial service agreement signed between the company and China Huadian Group Finance Co., Ltd. (hereinafter referred to as "Huadian finance company") in advance and agreed to submit relevant proposals to the sixth meeting of the Fourth Board of directors for deliberation.
After carefully reading the relevant materials provided by the company, we believe that the signing of the financial service agreement between the company and Huadian finance company is conducive to the company to make full use of the financial service platform provided by Huadian finance company, broaden financing channels, reduce financing costs, ensure the demand for operating funds, enhance the ability of capital allocation and maximize capital benefits.
On April 27, 2015, the company held the third meeting of the second board of directors to consider and approve the proposal on risk control system for connected transactions between Huadian Heavy Industries Co.Ltd(601226) and China Huadian Group Finance Co., Ltd., which considered the relevant risks that may affect the company's capital security and formulated risk control measures and disposal plans, which can prevent and control relevant risks and maintain the company's capital security. In addition, the company has made an objective and fair assessment of the business qualification, business and risk status of Huadian finance company. Huadian finance company has established a relatively perfect risk management system in accordance with the requirements of the financial regulatory department. All indicators meet the relevant standards and can effectively control the risks of financial business such as deposits and loans.
This connected transaction follows the commercial principles of compensation, fairness and voluntariness. The transaction content and deliberation procedures are legal and compliant, and the transaction pricing is fair, which will not affect the company's capital independence and security, and will not damage the interests of the company and other shareholders, especially the interests of minority shareholders. It is agreed to submit relevant proposals to the 2021 annual general meeting of shareholders of the company for deliberation.
9、 Independent opinions on providing guarantee for 222.7 million yuan bank credit of Huadian Caofeidian heavy industry equipment Co., Ltd., a wholly-owned subsidiary
The company provides guarantee for the wholly-owned subsidiary Huadian Caofeidian heavy industry equipment Co., Ltd. (hereinafter referred to as "Caofeidian heavy industry") to apply for a comprehensive bank credit of 222.7 million yuan, which can effectively reduce its financing cost, alleviate its capital pressure and ensure that it can better complete its business plan in 2022. At the same time, it is also conducive to the sustainable, stable and healthy development of the company and is in line with the overall interests of the company. The guarantee provided by the company to Caofeidian heavy industry will not damage the rights and interests of the company and shareholders. The decision-making and voting procedures of this guarantee are legal and effective. We unanimously agree to this guarantee and agree to submit relevant proposals to the 2021 annual general meeting of shareholders of the company for deliberation.
10、 Independent opinions on providing guarantee for the bank credit of RMB 80 million of the wholly-owned subsidiary Huadian Heavy Industries Co.Ltd(601226) Machinery Co., Ltd
The company provides guarantee for the wholly-owned subsidiary Huadian Heavy Industries Co.Ltd(601226) Machinery Co., Ltd. (hereinafter referred to as "heavy industry machinery") to apply for a comprehensive bank credit of 80 million yuan, which can effectively solve its capital demand, alleviate its capital pressure and ensure its better completion of the business plan in 2022. At the same time, it is also conducive to the sustainable, stable and healthy development of the company and is in line with the overall interests of the company. The guarantee provided by the company for heavy industrial machinery will not damage the rights and interests of the company and shareholders. The decision-making and voting procedures of this guarantee are legal and effective, and we unanimously agree on this guarantee.
11、 Independent opinions on providing guarantee for 50 million yuan bank credit of Wuhan Huadian Engineering Equipment Co., Ltd., a wholly-owned subsidiary
The company provides guarantee for the wholly-owned subsidiary Wuhan Huadian Engineering Equipment Co., Ltd. (hereinafter referred to as "Wuhan Huadian") to apply for a comprehensive bank credit of 50 million yuan, which can effectively solve its capital demand, alleviate its capital pressure and ensure its better completion of its business plan in 2022. At the same time, the guarantee provided by Wuhan Huadian will not damage the rights and interests of the company and shareholders. The decision-making and voting procedures of this guarantee are legal and effective. We unanimously agree to this guarantee and agree to submit relevant proposals to the 2021 annual general meeting of shareholders of the company for deliberation.
Independent director: Lu Daming, Wang Kun, Huang Yanghua April 22, 2002
