Securities code: 603112 securities abbreviation: Shanxi Huaxiang Group Co.Ltd(603112) Announcement No.: 2022-007 convertible bond Code: 113637 convertible bond abbreviation: Huaxiang convertible bond
Shanxi Huaxiang Group Co.Ltd(603112)
With regard to the announcement on the use of some idle raised funds of convertible bonds for cash management, the board of directors and all directors of the company guarantee that there are no false records, misleading statements or major omissions in the contents of this announcement, and bear individual and joint liabilities for the authenticity, accuracy and integrity of its contents. Important note: cash management trustee: commercial banks, securities companies, trust companies and other financial institutions. The cash management amount this time: no more than RMB 500 million (inclusive), and the funds can be accumulated and used. Type of cash management products: financial products with high security, good liquidity and capital preservation agreement, and the investment products shall not be used for pledge. Cash management period: valid within 12 months from the date of deliberation and approval by the board of directors and the board of supervisors of the company. Review procedures to be performed: Shanxi Huaxiang Group Co.Ltd(603112) (hereinafter referred to as “the company”) held the 18th meeting of the second board of directors and the 13th meeting of the second board of supervisors on January 20, 2022, and deliberated and adopted the proposal on cash management with the raised funds of some idle convertible bonds. On the premise of ensuring that the normal production and operation of the company and the safety of funds are not affected, it is agreed that the company shall conduct cash management on the temporarily idle raised funds with a total amount of no more than RMB 500 million (inclusive), and the validity period of the amount shall be valid within 12 months from the date of deliberation and approval by the board of directors and the board of supervisors of the company. The independent directors of the company have issued independent opinions with explicit consent, and the recommendation institution has issued clear verification opinions on this matter.
1、 Basic information of raised funds
Approved by the reply on approving Shanxi Huaxiang Group Co.Ltd(603112) public issuance of convertible corporate bonds (zjxk [2021] No. 3088) of China Securities Regulatory Commission, the company is approved to publicly issue 800 million yuan of convertible corporate bonds (hereinafter referred to as “convertible bonds”) to the public, deducting underwriting and recommendation fees, audit and verification fees, lawyer fees The external expenses directly related to the issuance of convertible bonds, such as information disclosure fees and issuance handling fees, totaled 13489284.90 (excluding tax), and the net amount of funds actually raised was 786510715.10 yuan. The above raised funds have been transferred to the designated account on December 28, 2021. Tianjian Certified Public Accountants (special general partnership) verified the availability of the funds raised by the convertible bonds issued by the company and issued the verification report (tjyz [2021] No. 3-81).
According to the requirements of relevant laws and regulations, the company has stored the raised funds in a special account, and signed the tripartite supervision agreement on the storage of raised funds in a special account with the sponsor Guotai Junan Securities Co.Ltd(601211) and the bank storing the raised funds.
2、 Application plan of the raised funds
According to the Shanxi Huaxiang Group Co.Ltd(603112) prospectus for public issuance of convertible corporate bonds (hereinafter referred to as the “prospectus”), the utilization plan of the raised funds of the company is as follows:
Unit: 10000 yuan
S / n project name total project investment total proposed raised capital investment
1. Machining production expansion and upgrading and parts industry chain extension 56437.53 52500.00 project
2. Intelligent upgrading of casting production line and improvement of R & D capacity 7612.80 6500.00
3. Supplementary working capital project 21000.00 21000.00
Total 85050.33 80000.00
3、 Reasons for idle raised funds
As the construction of raised investment projects requires a certain period, according to the project implementation plan and construction progress, part of the raised funds will be temporarily idle for a certain period of time. In order to improve the use efficiency of the raised funds, on the premise of ensuring that the safety of the raised funds and the normal progress of the investment plan of the raised funds are not affected, the temporarily idle raised funds are used for cash management to increase the company’s income and obtain more returns for the company and shareholders.
1. Investment varieties
The issuer of the company’s proposed investment products is a financial institution that can provide breakeven commitment. The product varieties are financial products with high security, good liquidity and breakeven agreement, and the investment products shall not be used for pledge. 2. Limit and term
On the premise of not affecting the normal progress of the company’s investment plan of raised funds, the company plans to conduct cash management on the temporarily idle raised funds with a total amount of no more than RMB 500 million (inclusive). Within the above limit, it shall be valid within 12 months from the date of deliberation and approval by the board of directors and the board of supervisors of the company. The term of financial products purchased shall not exceed 12 months and shall not affect the normal progress of the investment plan of raised funds. Within the above limit, the funds can be used on a rolling basis.
3. Implementation mode
The board of directors of the company authorizes the general manager to exercise the investment decision-making power and sign relevant contract documents within the limit, and the financial department is responsible for handling relevant matters.
4. Income distribution
The income from cash management of the company shall be used to make up the insufficient investment amount of the raised investment project and the working capital required for daily operation, and manage and use the capital in strict accordance with the requirements of China Securities Regulatory Commission and Shanghai Stock Exchange on the regulatory measures for raised funds. After the expiration of cash management, it will be returned to the special account for raised funds.
5. Information disclosure
The company will timely perform the obligation of information disclosure according to the progress of using idle raised funds to purchase principal guaranteed short-term financial products in accordance with the relevant requirements such as the Listing Rules of Shanghai Stock Exchange and the regulatory guidelines for listed companies No. 2 – regulatory requirements for the management and use of raised funds of listed companies.
5、 Investment risk and risk control measures
(I) investment risk
The financial products purchased by the company with some idle raised funds will be strictly evaluated and screened, but the income is affected by the macro-economy, and the investment is affected by market fluctuations.
(II) risk control measures
1. The company will handle relevant cash management business in strict accordance with relevant laws and regulations such as the Listing Rules of Shanghai Stock Exchange, the articles of association and the measures for the administration of Shanxi Huaxiang Group Co.Ltd(603112) raised funds.
2. The company will strictly screen investment objects and select products with good liquidity and short term issued by units with good reputation, large scale, ability to ensure capital safety, good operating efficiency and strong capital operation ability.
3. The company will timely track and analyze the investment direction and project progress of various financial products. Once it is found or judged that there may be adverse factors, it will timely take corresponding preservation measures to control investment risks.
4. The financial department of the company shall establish account management, establish complete accounting accounts for the use of funds, and do a good job in the accounting of the use of funds.
5. The independent directors and the board of supervisors of the company have the right to supervise and inspect the use of funds, and can hire professional institutions to audit when necessary.
6、 Impact on the daily operation of the company
On the premise of complying with relevant laws and regulations and ensuring that the normal progress of the company’s investment projects with raised funds and the safety of raised funds are not affected, the company’s use of some idle raised funds to purchase principal guaranteed financial products will not affect the normal development of the company’s investment projects with raised funds. By using some idle raised funds to purchase principal guaranteed financial products, we can improve the use efficiency of raised funds, obtain certain investment income and seek more investment returns for the company’s shareholders.
7、 Implementation of decision-making procedures and opinions of the board of supervisors, independent directors and recommendation institutions
(I) deliberations of the board of directors
On January 20, 2022, the 18th meeting of the second board of directors of the company deliberated and approved the proposal on cash management using some idle convertible bond raised funds, and agreed that the company plans to use idle raised funds of no more than RMB 500 million for cash management on the premise of ensuring that the normal operation of the investment projects with raised funds is not affected. After the matter is deliberated and approved by the board of directors, it does not need to be submitted to the general meeting of shareholders for deliberation.
(II) opinions of independent directors
For the company’s use of idle raised funds for cash management, the independent directors issued special opinions as follows:
On the premise of ensuring the normal implementation of the use plan of raised funds, the company uses some idle convertible bonds to raise funds for cash management, which will not affect the normal development of the company’s investment projects with raised funds and the company’s normal production and operation, improve the fund use efficiency, obtain a certain investment income and further improve the overall performance level of the company, In line with the rights and interests of the company and all shareholders. The contents and decision-making procedures of this matter comply with the stock listing rules of Shanghai Stock Exchange, the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies, and the guidelines for the self discipline supervision of listed companies of Shanghai Stock Exchange No. 1 – standardized operation.
Therefore, the independent directors unanimously agreed that the company would use the idle convertible bond raised funds of no more than RMB 500 million for cash management.
(III) opinions of the board of supervisors
On January 20, 2022, the 13th meeting of the second board of supervisors of the company deliberated and adopted the proposal on cash management using some idle convertible bond raised funds. This use of idle convertible bond raised funds for cash management is conducive to improving the use efficiency of idle convertible bond raised funds and increasing the investment income of the company, It will not affect the normal development of the company’s main business. The examination and approval procedures for this matter are legal and compliant, comply with the relevant provisions of the company, and there is no situation damaging the interests of the company and all shareholders. The board of supervisors of the company agrees that the company will use the funds raised by idle convertible bonds for cash management this time.
(IV) verification opinions of the recommendation institution
After verification, the sponsor believes that the company’s use of part of the idle raised funds of convertible corporate bonds for cash management has 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, comply with relevant laws and regulations and perform necessary legal procedures. The above matters 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 (revised in January 2022) and the measures for the management of raised funds by listed companies of Shanghai Stock Exchange. There is no change in the use of raised funds in a disguised manner and will not affect the normal progress of the investment plan of raised funds. The recommendation institution has no objection to Shanxi Huaxiang Group Co.Ltd(603112) using the idle raised funds of no more than 500 million yuan of convertible corporate bonds for cash management.
It is hereby announced
Shanxi Huaxiang Group Co.Ltd(603112) board of directors January 21, 2022
