The company and members of the Board of Directors guarantee that the content of information disclosed is true, accurate, complete and free from false records, misleading statements or material omissions.
Zangge Mining Co., Ltd. (hereinafter referred to as “the company”) held the 30th (interim) meeting of the 8th Board of Directors and the 25th (interim) meeting of the 8th Board of Supervisors on April 12, 2022, reviewed and passed Proposal of Entrusted Asset Management of Idle Funds. Under the premise of not affecting the company's daily operations and ensuring the safety of funds, to make rational use of idle funds and realize the maintenance and increase of funds, the company and its subsidiaries within its consolidated statements plan to use idle funds of no more than RMB 3 billion yuan at any time to purchase financial products, including structural deposits, income vouchers and other financial products with high security and good liquidity. Within the above capital limit, the funds can be used on a rolling basis. The Board of Directors authorizes the company management to handle the specific matters, and the authorization period shall be within 12 months from the date of deliberation and approval at the 30th (interim) meeting of the 8th Board of Directors.
According to Shenzhen Stock Exchange Stock Listing Rules, Articles of Association of Zangge Mining Co., Ltd. (hereinafter referred to as “Articles of Association”), Entrusted Asset Management System of Zangge Mining Co., Ltd., and other relevant provisions, the purchase of financial products is within the authority of the Board of Directors of the company, with no need to be submitted to the general meeting of shareholders of the company for deliberation. This purchase does not constitute a related transaction, nor a major asset restructuring as stipulated in Administrative Measures for Major Asset Restructuring of Listed Companies, hence not affecting the normal activities of operation and business of the company. The relevant matters are hereby announced as follows:
I. Overview of Entrusted Asset Management
1. Investment Purpose
On the premise of ensuring the company’s capital needs and safety of daily operation, the entrusted asset management can improve the efficiency of idle fund, seeking better investment returns for the company and shareholders.
2. Investment Quota
According to the capital status of the company and its subsidiaries included in the consolidated statements, it is proposed to use the idle funds of no more than RMB 3 billion yuan at any time to purchase financial products. Within the above limit, the funds can be used circularly.
3. Investment Varieties
Varieties include investment in banks, securities companies, fund companies and other financial institutions whose products are safe and with good liquidity.
4. Investment Period
It is within 12 months from the date of approval of the 30th meeting of the 8th Board of Directors.
5. Single Product Term
It is selected according to the financial status of the company.
6. Source of Funds
Idle funds of the company are to be entrusted under the premise of ensuring the capital need for the normal operation and development of the company.
Considering the strong timeliness of financial products, the Board of Directors authorizes the company’s management to work on the implementation of relevant matters within the above quota and period limits. Responsibilities include but not limit to: based on the company’s capital needs by periods and stages and its daily working capital, flexible allocating idle funds, timely purchasing financial products with high safety and liquidity, selecting qualified trustees, selecting the variety of entrusted financial products, determining the amount and period of entrusted capitals, and signing relevant contracts and agreements. The company and the financial trustee shall not have an associated relationship.
8. Review Procedure
The entrusted asset management is reviewed and approved by the Board of Directors and the Board of Supervisors, with independent directors expressing independent opinions. It need not be submitted to the general meeting of shareholders of the company for review. It does not constitute a related transaction, nor belong to the major asset restructuring stipulated by Administrative Measures for Major Asset restructuring of Listed Companies.
II. Risk Analysis and Risk Control Measures
1. Risk Analysis
The entrusted asset management products are subject to risks, and not excluded from the effects of market fluctuations in view of the macro-economy implications.
(2) Risks of fund deposit and use
(3) Operation and moral hazards of related personnel
2. Risk Control Measures
(1) Measures against risks are as follows:
1) The company will perform its duty in the preliminary investigation and feasibility demonstration of entrusted financial products, strictly abide by the principle of prudent investment, select stable investment varieties, and intervene timely and appropriately according to the economic situation and changes in the financial market, so as to prevent possible investment risks and ensure the safety and increase of investment funds.
2) The company has formulated Entrusted Asset Management System of Zangge Mining Co., Ltd. to prevent investment risks, which stipulates the principles, limits of powers, internal audit processes, internal reporting procedures, supervision of the funds and other aspects of entrusted asset.
(2) The following measures are proposed against the risks of fund deposit and use.
1) Establish complete accounts and financial accounting for the use of funds.
2) Independent directors are entitled to inspect the use of entrusted funds and express independent opinions on related matters submitted to the Board of Directors for consideration.
3) The Board of Supervisors shall inspect and supervise the use of funds on a regular or irregular basis.
(3) The following measures are proposed against the risks of operation and moral hazards of related personnel.
1) The related personnel shall keep the financial affairs confidential, not disclosing the financial plan, transaction, settlement, capital status, and other relevant information without permission.
2) Posts concerning the approval of investment business, capital entry and transfer out, and trading (subscription or redemption) shall be separated.
III. Impact on the Company
The investment is based on the guarantee of the working capital for the normal operation of the company, with idle funds as investment money, which shall not affect the daily capital turnover or the development of the company’s main business. It shall be conducive to improving the efficiency of capital use and increase the company’s income.
IV. Opinions of Independent Directors
Independent directors express the following independent opinions: the use of idle funds for entrusted asset management is conducive to improving the efficiency of funds and increasing income. It shall not affect the development of the company’s main business, and shall not damage the interests of the company and all shareholders, especially minority shareholders. The necessary formalities of the investment approval have been fulfilled, which is in line with relevant laws and regulations and the provisions of Articles of Association. Therefore, we agree that the company uses idle funds to purchase financial products.
V. Opinions of the Board of Supervisors
The Board of Supervisors believes that under the premise of ensuring the normal capital turnover and development of the company’s business, the company’s entrusted asset management is conducive to improving the efficiency of funds and will not affect the development of the company’s main business. It does no harm to the interests of the company and shareholders, especially of the minority shareholders. The company has performed the necessary approval procedures for entrusted asset management with the idle funds, which is in line with relevant laws and regulations and the provisions of Articles of Association.
VI. Other Issues
The company will continue to pay attention to the progress of the entrusted financial management, and timely perform the obligation of information disclosure in accordance with the relevant laws and regulations. Investors are advised to invest rationally and aware of investment risks.
VII. Documents for Reference
1. Resolutions of the 30th (interim) meeting of the 8th Board of Directors
2. Resolutions of the 25th (interim) meeting of the 8th Board of Supervisors
3. Opinions of Independent Directors.
It is hereby announced.