CITIC Securities Co., Ltd.
Special Audit Report on the Custody, Management, and Use of Raised Funds of Zhejiang Xianju Pharmaceutical Co., Ltd. in 2025
CITIC Securities Co., Ltd. (hereinafter referred to as "CITIC Securities" or "Sponsor") is the sponsor of Zhejiang Xianju Pharmaceutical Co., Ltd. (hereinafter referred to as "Xianju Pharmaceutical" or "the Company") for its 2020 private placement of shares. In accordance with the "Supervision Regulations for Raised Funds of Listed Companies," the "Stock Listing Rules of Shenzhen Stock Exchange," and the "Shenzhen Stock Exchange Listed Company Self-Regulatory Supervision Guidelines No. 13 – Sponsorship Business," CITIC Securities has audited the custody, management, and use of Xianju Pharmaceutical's raised funds in 2025. The specific situation is as follows:
I. Basic情况 of Raised Funds
(I) Amount of Raised Funds and Time of Receipt
Approved by the China Securities Regulatory Commission (hereinafter referred to as "CSRC") in the "Approval on the Private Placement of Shares by Zhejiang Xianju Pharmaceutical Co., Ltd." (Zhengjian Permit (2020) No. 2217), Zhejiang Xianju Pharmaceutical Co., Ltd. (hereinafter referred to as "the Company") issued 72,992,700 ordinary shares of RMB (A shares) at a par value of RMB 1 per share and an issue price of RMB 13.70 per share. The total amount of raised funds was RMB 999,999,990. After deducting relevant issuance expenses, the net amount of raised funds was RMB 987,357,806.75. Tianjian Certified Public Accountants (Special General Partnership) verified the paid-in capital of this fundraising and issued the "Capital Verification Report on the Newly Increased Registered Capital and Paid-in Capital (Share Capital) of Zhejiang Xianju Pharmaceutical Co., Ltd. for Private Placement of Shares" (Tianjian Verification (2020) No. 473) on November 3, 2020.
(II) Use and Balance of Raised Funds
As of December 31, 2025, the use and balance of Xianju Pharmaceutical's raised funds are as follows:
| Project | Sequence | Amount (RMB 10,000) |
|---|---|---|
| Net amount of raised funds | A | 98,735.78 |
| Accumulated amount at the beginning of the period | Project Investment | B1 |
| Project | Sequence | Amount (RMB 10,000) |
|---|---|---|
| Net interest income | B2 | 4,438.54 |
| Project Investment | C1 | 7,414.11 |
| Amount incurred during the period | Net interest income | C2 |
| Project Investment | D1=B1+C1 | 93,349.49 |
| Accumulated amount at the end of the period | Net interest income | D2=B2+C2 |
| Outstanding raised funds | E=A-D1+D2 | 9,907.60 |
| Actual outstanding raised funds | F | 9,907.60 |
| Difference | G=E-F | - |
II. Custody and Management of Raised Funds
(I) Management of Raised Funds
To standardize the management and use of raised funds, improve the efficiency and effectiveness of fund utilization, and protect investors' rights and interests, in accordance with the "Stock Listing Rules of Shenzhen Stock Exchange," "Supervision Regulations for Raised Funds of Listed Companies," "Shenzhen Stock Exchange Listed Company Self-Regulatory Supervision Guidelines No. 1 – Operating Rules for Main Board Listed Companies," and other relevant laws and regulations, and in conjunction with the "Articles of Association," the Company has formulated the "Raised Funds Management System." This system clearly stipulates the special deposit, use, change, hierarchical approval authority, decision-making procedures, risk control measures, and information disclosure procedures for raised funds, as well as supervision and accountability.
The Company's Seventh Board of Directors' Ninth Meeting approved the "Proposal on Signing the Tripartite Supervision Agreement for Raised Funds." On November 24, 2020, the Company, together with the sponsor CITIC Securities, signed the "Tripartite Supervision Agreement for Raised Funds" with the Xianju Branch of Industrial Bank Co., Ltd. and the Xianju Branch of Bank of China Co., Ltd. This agreement clarifies the rights and obligations of all parties. The tripartite supervision agreement does not have significant differences from the tripartite supervision agreement template of the Shenzhen Stock Exchange. The Company has strictly adhered to it when using raised funds.