Yellow River whirlwind: Announcement on the use of raised funds

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Henan Huanghe Cyclone Co., Ltd. (hereinafter referred to as “the company”) intends to use the raised funds of up to 400 million yuan to purchase bank-guaranteed wealth management products for a period of 12 months from the date of approval by the board of directors.

First, the basic situation of raised funds

Approved by the China Securities Regulatory Commission on the approval of the non-public offering of shares of Henan Huanghe Cyclone Co., Ltd. (Zheng Jian Li [2014] No. 1342), the company issued RMB 161,669,696 shares of RMB common stock to 6 specific targets. The issue price was RMB 6.60, and the total amount of funds raised was RMB 1,067,019,993.60. After deducting the issuance expenses totaling RMB 28,687,169.54, the net proceeds raised were RMB 1,038,332,824.06. The above funds were put in place on January 30, 2015, and the company was certified by Zhitong Accounting Firm ( Special General Partnership) Verification and issue of the Capital Verification Report (To Tongci (2015) No. 110ZC0051). The company has adopted a special account storage system for the raised funds, and has signed the “Tripartite Supervision Agreement for the Collection of Special Accounts for Raised Funds” with the sponsor institution (lead underwriter) and the bank that deposits the raised funds.

Second, the use of raised funds

According to the resolution of the 2013 Annual General Meeting of Shareholders, before the non-public offering of funds is in place, the company will invest in self-raised funds according to the actual situation of the project schedule, and will replace it after the raised funds are in place. The First Extraordinary Meeting of the Sixth Board of Directors in 2015 and the First Extraordinary Meeting of the Sixth Supervisory Committee in 2015 reviewed and approved the Proposal on Replacing Pre-Invested Self-raised Funds with Raised Funds, Independent Directors, Board of Supervisors and Sponsors They respectively expressed their opinions and agreed that the company will replace the pre-invested self-raised funds of RMB 153,829,921.48 with the raised funds. Ruihua Certified Public Accountants (Special General Partnership) issued the “Advance Investment Funds for Self-raised Funds of Henan Huanghe Cyclone Co., Ltd.” The Situation Assurance Report (Ruihua Nuclear [2015] 48060010) explains the company's pre-investment in fundraising projects with self-raised funds. For details, please refer to the Shanghai Securities News and the Shanghai Stock Exchange website

According to the company's fundraising project promotion plan, some of the company's recently raised funds may be temporarily idle.

Third, the use of part of the idle raised funds to purchase wealth management products

In order to improve the efficiency of the use of raised funds, the company plans to use some of the idle raised funds to purchase bank-guaranteed wealth management products with high security, good liquidity and guaranteed capital, in the case of ensuring that the construction of fundraising projects and the use of raised funds are not affected. details as following:

(1) Source of funds and investment quota

The company intends to use the temporary idle raised funds with a maximum amount of not more than 400 million yuan for cash management to purchase guaranteed-type wealth management products. Within the above quota, funds can be used in a rolling manner.

(II) Variety of wealth management products and investment period

In order to control risks, the issuing entity of the wealth management products to be purchased by the company is a commercial bank that can provide a capital preservation commitment. The investment products are bank wealth management products with high security, good liquidity and guaranteed capital preservation. It may not be used for securities investment, and may not purchase high-risk wealth management products with stocks and derivatives and unsecured bonds as investment targets.

The term of a single wealth management product is no longer than one year.

(3) The validity period of the resolution

Valid for one year from the date of approval by the board of directors.

(4) Implementation methods

The chairman of the authorized company shall exercise the investment decision-making power and sign the relevant contract documents within one year from the date of deliberation and approval by the board of directors, and the financial department of the company shall be responsible for organizing the implementation and management.

The bank wealth management products purchased by the company shall not be pledged. The special settlement account for wealth management products shall not store non-raised funds or be used for other purposes. If the special settlement account for products is opened or cancelled, the company shall promptly file with the Shanghai Stock Exchange for filing and public announcement.

(5) Information disclosure

After purchasing wealth management products, the company will fulfill its information disclosure obligations in a timely manner, including the amount, duration and income of the purchase of wealth management products.

The company will disclose the company's investment in wealth management products and its corresponding profit and loss during the reporting period in the special report on the periodic report and the deposit and use of funds raised.

(6) Investment risk and risk control measures

1. Investment risk

(1) The principal-guaranteed wealth management products purchased by the company are low-risk investment products, but the financial market is affected by the macro economy, and it is not excluded that the investment is affected by market fluctuations.

(2) The company will intervene according to the economic situation and changes in the financial market in a timely and appropriate manner, and does not rule out the impact of market fluctuations.

2. Risk control measures

(1) The company establishes and approves the approval and execution procedures for the purchase of wealth management products in accordance with the principle of separation of decision-making, execution and supervision functions to ensure the effective development and standard operation of the purchase of wealth management products.

(2) The company's finance department will analyze and track the investment and progress of wealth management products in a timely manner. Once there are risk factors that may affect the safety of the company's funds, it will take timely preservation measures to control investment risks.

(3) The independent directors and the board of supervisors of the company have the right to conduct regular or irregular inspections of the wealth management products invested by the company, and may employ professional institutions to conduct audits when necessary.

(VII), the impact on the company's operations

The company's use of part of the idle raised funds to purchase guaranteed-type wealth management products is carried out on the premise of ensuring the funds required for the company's fundraising projects and ensuring the security of the raised funds. It does not affect the construction of the fund-raising investment projects and does not affect the company's main business. development of. Through modest capital-guaranteed short-term financial management, it is conducive to improving the efficiency of fund use, and there is no behavior to change the use of funds in disguised form, which is in the interest of the company and all shareholders.

Fourth, special advice

(1) Opinions of independent directors

Under the premise of not affecting the normal investment of the raised capital investment plan, the company uses the idle raised funds with a maximum amount of not more than 400 million yuan for cash management, and has high investment security, good liquidity, and guaranteed bank wealth management products and decision-making procedures. It complies with the relevant provisions of the China Securities Regulatory Commission, “Regulations on the Supervision of Listed Companies No. 2—Regulatory Requirements for the Management and Use of Funds Raised by Listed Companies”, and the Shanghai Stock Exchange “Administrative Measures on the Raised Funds of Listed Companies (Revised in 2013), etc. It is conducive to improving the efficiency of the use of funds raised by the company. It does not contradict the implementation plan of the fund-raising investment project, and does not affect the normal operation of the fund-raising investment project. There is no disguised change in the investment of the fundraising and damage to the interests of the shareholders of the company. The interests of shareholders. Therefore, we unanimously agree that the company will use the idle raised funds with a maximum amount of not more than 400 million yuan to invest in bank-guaranteed wealth management products.

(II) Opinions of the Board of Supervisors

Under the premise of ensuring that the fund-raising investment project construction and fund-raising plan are not affected, the company will use some idle raised funds to purchase capital-guaranteed wealth management products, which will help improve the efficiency of the use of raised funds and obtain certain investment benefits without affecting. The construction of raised funds and the use of raised funds do not change the use of raised funds in disguise, in line with the interests of the company and all shareholders, and there is no harm to the interests of the company and all shareholders, especially small and medium shareholders, in line with the listing of the China Securities Regulatory Commission. The company's supervision guidelines No. 2—Regulatory requirements for the management and use of raised funds of listed companies” and the Shanghai Stock Exchange “Administrative Measures on the Raised Funds of Listed Companies (Revised in 2013) and other relevant regulations. The Board of Supervisors agreed that the company will use the idle raised funds with a maximum amount of not more than 400 million yuan to purchase bank-guaranteed wealth management products.

(3) Opinions of sponsor institutions

The company's use of part of the idle raised funds to purchase guaranteed-type wealth management products has been reviewed and approved by the company's sixth extraordinary board meeting in 2015 and the first extraordinary meeting of the sixth board of supervisors in 2015. The independent directors have issued clear consent. , fulfilled the necessary legal procedures; the company used part of the idle raised funds to purchase guaranteed-type wealth management products, in line with the “Regulations for the Supervision of Listed Companies No. 2—Regulatory Requirements for the Management and Use of Raised Funds of Listed Companies” and “Shanghai Stock Exchange Listing Rules” And the requirements of the “Regulations on the Management of Funds Raised by Listed Companies of the Shanghai Stock Exchange” (revised in 2013); the company’s use of some idle raised funds to purchase wealth management products does not change the use of raised funds in disguise, and does not affect the raised funds. The investment plan is going on normally and can improve the efficiency of fund use, in line with the interests of the company and all shareholders. The sponsor institution has no objection to the use of part of the idle funds raised by the Yellow River Cyclone to purchase guaranteed-type wealth management products.

V. Documents for reference

1. The resolution of the first extraordinary meeting of the sixth board of directors of the company in 2015;

2. The resolution of the first extraordinary meeting of the sixth supervisory committee of the company in 2015;

3. Independent opinions of independent directors on the use of part of the idle raised funds to purchase capital-guaranteed wealth management products; 4. The verification opinions of the sponsors on the use of part of the idle raised funds to purchase capital-guaranteed wealth management products.

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