Weikang Pharmaceutical: Guolian Minsheng Securities Underwriting and Sponsor Co., Ltd.’s verification opinions on Zhejiang Weikang Pharmaceutical Co., Ltd.’s use of part of the super-raised funds to permanently replenish working capital
Guolian Minsheng Securities Underwriting and Sponsoring Co., Ltd.
Verification opinions on Zhejiang Weikang Pharmaceutical Co., Ltd.’s use of part of the super-raised funds to permanently replenish working capital
Guolian Minsheng Securities Underwriting and Sponsoring Co., Ltd. (hereinafter referred to as "Guolian Minsheng Underwriting and Sponsoring" or the "sponsoring agency") serves as the sponsoring agency for Zhejiang Weikang Pharmaceutical Co., Ltd. (hereinafter referred to as "Weikang Pharmaceutical" or the "Company")'s initial public offering and listing on the GEM. In accordance with relevant regulations such as the "Administrative Measures for the Sponsorship Business of Securities Issuance and Listing", the "Shenzhen Stock Exchange GEM Stock Listing Rules" and the "Shenzhen Stock Exchange Guidelines for the Sponsorship of Listed Companies", the company's use of part of the excess raised funds to permanently replenish liquidity was verified.
Zhejiang Weikang Pharmaceutical Co., Ltd. held the 11th meeting of the fourth board of directors on April 28, 2026, and reviewed and approved the "Proposal on Using Part of the Over-raised Funds to Permanently Supplement Working Capital". The company plans to use the over-raised funds of RMB 40.8 million (including interest income, the specific amount shall be based on the bank balance on the day when the funds are transferred) to permanently replenish working capital. The details are as follows:
1. Basic situation of raised funds
With the approval of the China Securities Regulatory Commission's "Reply on the Registration of the Initial Public Offering of Stocks of Zhejiang Weikang Pharmaceutical Co., Ltd." (CSRC Permit [2020] No. 1652), the company publicly issued 20.11 million RMB ordinary shares (A shares) to the public. The par value of each RMB ordinary share in this public offering is RMB 1.00, and the issuance price is 41.34 Yuan/share, the total amount of funds raised by this issuance is 831.3474 million yuan, and the net amount of funds raised after deducting the issuance expenses is 725.5956 million yuan.
The above-mentioned receipt of funds raised has been verified by Tianjian Accounting Firm (Special General Partnership), and a "Capital Verification Report" "Tianjianyan [2020] No. 323" was issued on August 19, 2020. The company has adopted a special account storage system for raised funds and established relevant special accounts for raised funds. After the raised funds arrive, they have all been deposited in a special account for raised funds, and a tripartite supervision agreement for raised funds has been signed with the sponsor and the bank where the raised funds are deposited.
2. Basic situation of investment projects with raised funds
According to the company's "Prospectus for Initial Public Offering of Stocks and Listing on GEM", the investment projects and use plans of funds raised from the initial public offering of stocks are as follows:
Unit: RMB 10,000 Serial number Investment project with raised funds Total project investment (RMB 10,000) Amount of investment from raised funds (RMB 10,000) Phase I Project of Medical Health Industrial Park (Chinese Medicine Pieces
1 35,862.00 35,862.00 and traditional Chinese medicine extraction, research and development center, warehousing center)
2 Marketing network center construction project 2,143.00 2,143.00 3 Supplementary working capital project 16,000.00 16,000.00
Total 54,005.00 54,005.00
The portion of the company's net raised funds exceeding the investment amount of the above-mentioned projects is over-raised funds, and the amount of over-raised funds is 185.5456 million yuan (after deducting issuance expenses).
3. Usage of super-raised funds
As of the date of disclosure of this verification opinion, the company’s use plan and situation of excess raised funds are as follows:
The company held the 17th meeting of the second session of the board of directors on March 29, 2021, and held the 2020 Annual General Meeting of Shareholders on May 17, 2021. The "Proposal on Using Super Raised Funds to Increase Investment in Some Raised Investment Projects" was reviewed and approved, and the company was agreed to use the super raised funds to increase investment in the first phase of the Medical Health Industrial Park project (Chinese medicine pieces and traditional Chinese medicine extraction, R&D center, and storage center) by RMB 97.2094 million.
The company held the fourth meeting of the third session of the Board of Directors on December 14, 2021, and held the company's first extraordinary shareholders' meeting of 2021 on December 30, 2021 to review and adopt the "Proposal on Using Part of the Over-raised Funds to Permanently Supplement Working Capital", and agreed that the company would use 55 million yuan of over-raised funds to permanently supplement working capital.
As of the date of disclosure of this verification opinion, the company has used a total of RMB 152.2094 million of over-raised funds, and the remaining over-raised funds totaled RMB 40.8 million (including interest income, the specific amount is based on the bank balance on the day when the funds are transferred out).
4. The plan to use part of the super-raised funds to permanently replenish working capital
Combined with the company's development plan and actual operating needs, in order to improve the efficiency of the use of over-raised funds, optimize the company's financial structure, and promote efficiency improvement, in accordance with the "Supervisory Rules for Funds Raised by Listed Companies", "Shenzhen Stock Exchange GEM Stock Listing Rules", "Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 2 - Standardized Operation of GEM Listed Companies" and other relevant regulations, the company plans to use part of the over-raised funds of 40.8 million yuan (including interest income, the specific amount shall be based on the bank balance on the day when the funds are transferred) to permanently replenish working capital, accounting for 30% of the total over-raised funds. 21.99%, used for the company's business development and daily operations, etc., in line with the company's actual business development needs and the interests of all shareholders.
- The company’s explanation and commitment on using part of the super-raised funds to permanently replenish working capital.
According to the "Regulations on the Supervision of Funds Raised by Listed Companies" and its revised instructions issued by the China Securities Regulatory Commission on May 9, 2025, the "Supervisory Rules on Funds Raised by Listed Companies" will be implemented on June 15, 2025. The new rules will apply to over-raised funds obtained from issuance after implementation; the old rules will apply to over-raised funds obtained from issuance before implementation. The company's over-raised funds were obtained in August 2020. Therefore, the company's plan to use part of the over-raised funds to permanently replenish working capital this time complies with the relevant requirements of the "Supervisory Rules for Raised Funds by Listed Companies" regarding over-raised funds.
The use of part of the excess raised funds to permanently replenish working capital does not conflict with the implementation plan of the raised funds investment project, does not affect the normal progress of the raised funds investment projects, and does not change the investment direction of the raised funds in any disguised manner and harm the interests of shareholders.
The company promises: (1) The amount used to permanently replenish working capital shall not exceed 30% of the total amount of over-raised funds every twelve months; (2) Within twelve months after replenishing working capital, it will not conduct high-risk investments such as securities investments and derivatives transactions or provide financial assistance to objects other than its holding subsidiaries.
- Review procedures and relevant opinions on using part of the excess raised funds to permanently replenish working capital.
(1) Review status of the Audit Committee of the Board of Directors
The company held the seventh meeting of the Audit Committee of the fourth board of directors on April 28, 2026, and reviewed and approved the "Proposal on Using Part of the Over-raised Funds to Permanently Supplement Liquidity". After deliberation, the Audit Committee believes that the company's use of part of the over-raised funds to permanently replenish working capital does not change the investment direction of the raised funds in a disguised manner and harm the interests of shareholders. All members of the Audit Committee agreed that the company would use the over-raised funds of 40.8 million yuan (including interest income, the specific amount is based on the bank balance on the day when the funds are transferred out) to permanently supplement working capital, and submitted the proposal to the company's board of directors for review.
(2) Review status of the board of directors
The company held the 11th meeting of the fourth session of the board of directors on April 28, 2026, and reviewed and approved the "Proposal on Using Part of the Over-raised Funds to Permanently Supplement Working Capital", agreeing that the company will use part of the over-raised funds of RMB 40.8 million (including interest income, the specific amount shall be based on the bank balance on the day when the funds are transferred out) for permanent replenishment of working capital. The proposal still needs to be submitted to the company's 2025 annual shareholders' meeting for review.
7. Verification Opinions of the Sponsor
After verification, the sponsor institution believes that the company's use of part of the excess raised funds to permanently replenish liquidity has been reviewed and approved by the company's board of directors and the audit committee, and the necessary procedures have been fulfilled. It still needs to be submitted to the shareholders' meeting for review. The relevant matters are in compliance with the "Measures for the Administration of Sponsorship Business for Securities Issuance and Listing", "Shenzhen Stock Exchange GEM Stock Listing Rules" and "Shenzhen Stock Exchange Self-Regulatory Supervision Guidelines for Listed Companies". No. 2 - Standardized Operation of GEM Listed Companies, "Listed Company Supervision Guidelines No. 2 - Supervisory Requirements for the Management and Use of Funds Raised by Listed Companies", "Regulations on the Supervision of Funds Raised by Listed Companies" and other relevant regulations are conducive to improving the efficiency of the use of raised funds, reducing financial costs, meeting the company's business development needs for working capital, and there will be no change in the use of raised funds or damage to the interests of shareholders.
In summary, the sponsor has no objection to Weikang Pharmaceutical’s use of part of the super-raised funds to permanently replenish its liquidity.
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(This page has no text, but is the signature page of "Guolian Minsheng Securities Underwriting and Sponsoring Co., Ltd.'s Verification Opinions on Zhejiang Weikang Pharmaceutical Co., Ltd.'s Use of Part of the Overraised Funds to Permanently Replenish Liquidity")
Sponsor representative: ____________________ __________________
Zhong Desong Bao Jingjing
Guolian Minsheng Securities Underwriting and Sponsoring Co., Ltd.
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