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) January, 2002
Shanghai Stock Exchange:
We have received your reply to the second round of examination and inquiry letter on Wuxi Autowell Technology Co.Ltd(688516) application documents for issuing shares to specific objects (szkss (refinancing) [2022] No. 17) (hereinafter referred to as "the second round of inquiry letter") issued on January 22, 2022. Wuxi Autowell Technology Co.Ltd(688516) (hereinafter referred to as " Wuxi Autowell Technology Co.Ltd(688516) ", "the issuer", "the company") and Ping An Securities Co., Ltd. (hereinafter referred to as "the sponsor"), Guohao law firm (Shanghai) (hereinafter referred to as "the issuer's lawyer") and other relevant parties have checked the questions listed in the second round of inquiry letter item by item. 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 the issuance of 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
Amendments and supplements to the prospectus in italics (BOLD)
Question 1: about the issuance plan
According to the inquiry reply, Ge Zhiyong used 550 million yuan to subscribe for the shares issued this time 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) (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) 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, 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 agency holding, compensation, promised income or other interest arrangement between himself and his controlled related parties and the lender. In the future, he is willing to accept relevant supervision and inspection on this commitment. In case of violation of this commitment, the relevant income corresponding to the illegal part shall be owned by the listed company.
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 loan amount 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 January 20, 2022: LPR for one-year term is 3.7%, and LPR for more than five years 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 current market value of Ge Zhiyong's main assets is high, and the real risk borne by the lender is low
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 the photovoltaic industry, and the improvement of the competitiveness of its main products, Wuxi Autowell Technology Co.Ltd(688516) is currently in good operation. According to its performance forecast, Wuxi Autowell Technology Co.Ltd(688516) it is estimated that the net profit attributable to the shareholders of the listed company from January to December 2021 will be 327 million to 342 million yuan, with a year-on-year increase of 110.16% to 120.14%.
Ge Zhiyong's main asset is his 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) . It is planned to calculate the average daily closing price. Before and after this subscription, the company's shares held by GE Zhiyong are worth 4.517 billion yuan and 6.190 billion yuan.
Therefore, despite the risk of sharp fluctuations in the stock price, considering the good operating conditions of Wuxi Autowell Technology Co.Ltd(688516) and the high market value of the shares held by GE Zhiyong as one of the actual controllers of Wuxi Autowell Technology Co.Ltd(688516) , the principal and interest repayment of Zhang Hong and Wang Huaiqian's loan still has a high safety margin, and the real risk of their loan is low. To sum up, Zhang Hong and Wang Huaiqian can obtain higher fixed income by lending large amounts 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) , the market value of his shares after the issuance is high, and Wuxi Autowell Technology Co.Ltd(688516) is in good operating condition, The lender's real risk of this loan is relatively low. Therefore, Zhang Hong and Wang Huaiqian believe that the large amount of funds lent to ge Zhiyong to subscribe for the shares issued this time is 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) ; 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. I have no holding or other interest arrangement with the borrower Ge Zhiyong and its controlled affiliates. 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) .
1-2-3: the borrower shall promise and disclose in the prospectus that the loan fund is indeed a loan, and there is no agency holding, compensation, promised income or other interest arrangement between himself and his controlled related parties and the lender. He is willing to accept relevant supervision and inspection on this commitment in the future. In case of violation of this commitment, the relevant income corresponding to the illegal part shall be owned by the listed company
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.
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) application documents for issuing shares to specific objects)
Wuxi Autowell Technology Co.Ltd(688516) mm / DD / yy
Statement of the chairman of the issuer
I have carefully read Wuxi Autowell Technology Co.Ltd(688516) all the contents of the reply to 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) year
