*ST Middle Velvet (000982): Cancel Two Investment Proposals Before Receiving Enquiry Letter

*ST Zhong Rong (000982) announced today evening that the company decided to cancel the two motion of the first provisional shareholders' meeting this year.

The two motions are the motion on investment in Securities and the motion to invest in the establishment of Beijing Yan Han technology investment management partnership (limited partnership), which has been approved by the board of directors in January.

*ST Zhong Rong said that after the disclosure of the above bill, the company, based on feedback from small and medium-sized shareholders, combined with the company's reorganization plan, further discussed the board of directors of the company. Based on more prudent and security considerations, the two investment proposals need to be further demonstrated.

One of the two is to use the accumulated amount of not more than 600 million yuan to carry out securities investment related business according to the development of the business, of which no more than 100 million yuan will invest in stocks, including the two level market investment, new stock placement or purchase, issuance and so on. The amount of 500 million yuan will be invested in other securities, including fund, bond investment (including convertible bonds) and repurchase.

The other is the establishment of Beijing Yan Han technology investment management partnership (limited partnership), the size of the partnership is 201 million yuan, *ST as a limited partner, and intends to invest 200 million yuan in its own capital, with a contribution ratio of 99.5%. The partners are Hunan crown Cci Capital Ltd.

In 2019, *ST Zhong Rong was implemented in bankruptcy and reorganization. *ST Zhong Rong said the reformed short-term business plan (2020 -2021) was "around the control of the supply of raw wool and the trade in cashmere related products". The middle and long term business plan (after 2022) is that, on the basis of controlling raw materials, the listed companies will start building high-end brands from raw materials, yarns and fabrics, so as to expand their business scale. And thickening the business purpose of operating profits.

*ST Zhong Rong announced in February 26th that on the 23 day, it signed the strategic cooperation framework agreement with Kang Ming Bai, and jointly promoted the development of the platform of "Mebs-lg" (antibody specific bispecific antibody) platform, and chose to go to the domestic CDMO platform to provide one-stop technology service for customers to carry out strategic cooperation.

On the evening of February 26th, the Shenzhen Stock Exchange issued a letter of concern to the *ST on issues related to the matter. It asked *ST to carry out the main business of the company after the completion of the bankruptcy reorganization, including the specific contents, the main body and the way of development, and whether the follow-up business development plan and specific arrangements were matched with the business plan stipulated in the draft plan of the company's reorganization plan, and the company launched securities investment. The reasonableness and necessity of setting up a limited partnership outside the country and whether it matches the business plan stipulated in the draft reorganization plan may affect the development of the main business of the company. He also asked for an explanation of the need to cooperate with Kang Ming Bai Ao, which required disclosing the financial data of the partners and collaborator.