Article 1 To regulate enterprises’ capital increase behaviors at China Beijing Equity Exchange (hereinafter referred to as the CBEX), these measures are formulated in accordance with the Corporation Law of the People’s Republic of China and the Implementation Opinions on Further Regulating the Restructuring of State-owned Enterprises (2005 No. 60).
Article 2 These measures apply to capital increase behaviors of state-owned or state-controlled enterprises, and serve as the reference for the capital increase behaviors of other types of enterprises excluding non state-owned companies.
Article 3 The enterprise seeking capital increase (i.e., the financier) and the intended investor may entrust their corporate capital increase issues to the CBEX.
Article 4 The CBEX provide the enterprise with services including receiving financing application, releasing financing information, registering investment intention, determining investor, organizing contract signing for shareholders and presenting certification documents, etc.
Article 5 Enterprises seeking capital increase shall file an information release application to the CBEX after completing relevant procedures, including inner decision, reporting for approval, financial auditing and capital rating, etc., according to relevant laws, rules and policies. The CBEX shall release the capital increase information.
Article 6 The financial applying for information release shall submit the following materials to the CBEX:
- Corporate Capital Increase Information Release Application;
- Business license for legal person of the financier;
- Corporate constitution of the financier;
- Inner decision documents of the financier;
- Certificate of registration for state-owned property rights or annual inspection form of state-owned property rights registration;
- Approval documents from approving authorities;
- Capital increase or restructuring scheme;
- Resolutions about employee settlement that shall be submitted for the approval of the financier’s Workers’ Congress;
- Financier’s capital rating report, capital rating record form or approval document;
- Financier’s financial auditing report from the last 3 years;
- Financier’s recent financial reports;
- Letter of legal opinion;
- Other documents required by the CBEX.
Article 7 The CBEX shall examine and verify the completeness of the materials submitted by the financier or through the broker member within 3 business days after receiving the materials. Upon approval, the CBEX shall present the financial with a Letter of Acceptance of Corporate Capital Increase Information Release Application. In case of non-approval, the CBEX shall inform the financier to supply the missing materials.
Article 8 The financier shall be responsible for the authenticity, completeness and validity of the submitted materials. Where the financier entrusts a broker member, the broker member shall examine and verify the authenticity, completeness, validity and conformity of the materials submitted by the financier.
Article 9 The released information is mainly from the Corporate Capital Increase Information Release Application, including the following elements:
- Basic information about the financier;
- Major financial indicators and capital assessment;
- Inner decision and its approval;
- Important information disclosure;
- Financing terms and requirements for investors;
- Margin call;
- Other issues that need to be disclosed.
Article 10 The financier may have necessary requirements for the investor’s qualification, business integrity, business circumstance, financial circumstance, management ability and asset size, and these requirements shall comply with relevant laws and regulations of the state.
Article 11 The period of information release shall be determined by the financier, which shall not be fewer than 20 business days.
Article 12 The information shall be released on the CBEX website, and provincial level, publicly released newspapers and magazines specializing in economy or finance to attract intended investors. The date of information release starts as of the day the corporate capital increase information is published.
Article 13 When filing the information release application, the financier may request a prolonged release of the original information when no intended investor is found before the release period expires. One prolonged period constitutes 5 business days, and shall be continued until the intended investor is found. However, the accumulative release period shall not exceed 6 months.
Article 14 When filing the information release application, the financier may request a change of capital increase information and a new information release when no intended investor is found before the release period expires. The new release period shall not be fewer than 20 business days. The change of capital increase information shall be approved by approving authorities, and the financier shall submit relevant approving documents.
Article 15 Where the financier has not applied for prolonged release or new release when filing the information release application, the information release shall be terminated when no intended investor is found before the release period expires.
Article 16 The financier shall not change or cancel the released information during the information release period. Change or cancellation that has to be made due to special reasons shall require approval documents from approving authorities. The CBEX shall publish a notice on the original information release channel, which starts counting on the date of release.
Article 17 During the period of information release, the intended investor shall consult relevant materials. The financier shall accept the query from the intended investor.
Article 18 The intended investor shall file an investment application to the CBEX within the period of information release for registration.
Article 19 The intended investor shall submit the following materials when filing investment application to the CBEX:
- Corporate Capital Increase Application;
- Certificate of the legal person, or ID of the natural person;
- Recent balance sheet and income statement of the corporate legal person; valid credit standing and respectability of the natural person and other legal body;
- Articles and inner decision documents;
- Relevant documents and certificates meeting the investment requirements;
- Other documents required by the CBEX.
Article 20 The intended investor shall be responsible for the authenticity, completeness and validity of the submitted materials. The entrusted broker member shall examine and verify the authenticity, completeness, validity and conformity of the materials submitted by the intended investor.
Article 21 The intended investor shall meet the following requirements:
- Sound financial condition and payment ability;
- Sound business credit;
- A natural person intended investor shall have full capacity for civil conduct;
- A intended investor that is a legal person, natural person or other organization from a foreign country, Hong Kong SAR, Macao SAR, or Taiwan shall meet the Provisions on Guiding the Orientation of Foreign Investment released by the State Council and other relevant regulations;
- Other requirements set by state laws, administrative laws and regulations.
Article 22 When the intended investor files an investment application, it is considered to have accepted the requirements in the released information.
Article 23 The CBEX shall check for completeness of the Corporate Capital Increase Application and the application materials within 2 business days after the investment application materials are received. Where the intended investor has not submitted complete materials, the CBEX shall inform in written form the intended investor to supply the missing materials.
Article 24 When all materials submitted by the intended investor are complete, the CBEX shall investigate and evaluate the investor according to the requirements in the released information with the financier. Upon approval, the CBEX shall present a Confirmation of Accredited Investor Status to the intended investor.
Article 25 The Confirmation of Accredited Investor Status shall inform the intended investor of the amount and deadline for margin payment. The deadline is normally 5 business days after the Confirmation of Accredited Investor Status is presented by the CBEX.
Article 26 The intended investor shall pay a margin call to the CBEX according to the requirement in the Confirmation of Accredited Investor Status within the time limit set in the status confirmation notice. Where the intended investor fails to pay the margin call in time, its status shall be considered renounced.
Article 27 Where only 1 intended investor is found through a public call, the interested parties hall sign the Corporate Capital Increase Agreement within 5 business days.
Article 28 Where 2 or more intended investors are found through a public call, the CBEX shall organize a tendering and bidding activity, and determine the final investor according to the Law of the People’s Republic of
Article 29 Before signing the Corporate Capital Increase Agreement, the financier shall fully guarantee the priority enjoyed by the original shareholders of the enterprise according to the Corporation Law and the Corporate Constitution to inscribe and purchase stocks first.
Article 30 After the investor is determined, the CBEX shall recoup the margins from the other intended investors all at once. The margin from the investor shall be refunded after the signing of the Corporate Capital Increase Agreement. Where disposal of the margin is otherwise agreed upon in the information disclosure or between interested parties, the agreement shall be followed.
Article 31 After the interested parties have signed the Corporate Capital Increase Agreement and paid the service charge, the CBEX shall present the certification documents and inform the interested parties about receiving the documents within 3 business days.
Article 32 Where the financier provides fake, false or omissive information and materials due to restructuring of the enterprise and leads to losses on the part of the interested party, the financier shall be liable for the losses resulting therefrom.
Article 33 All documents on the capital increase projects shall be stored in the archive and for the record by the CBEX.
Article 34 These measures shall be reported to the state-owned property supervision and administration body and relevant governmental departments for the record.
Article 35 The power of interpretation and amendment of these measures shall be vested in the CBEX.
Article 36 These measures shall come into trial implementation on the day of release.