I. Purpose of Conducting Foreign Exchange Hedging Business
According to the development strategy and business growth of Guangdong Xianglu Tungsten Industry Co., Ltd. (hereinafter referred to as "the Company"), in order to further mitigate foreign exchange market risks, the Company and its subsidiaries plan to engage in foreign exchange hedging business with banks and other financial institutions. This is beneficial for reducing the adverse effects of exchange rate fluctuations on the Company's production operations and cost control, thereby minimizing foreign exchange losses.
II. Overview of Foreign Exchange Hedging Business
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Main Currencies and Business Types
The foreign exchange hedging business of the Company and its subsidiaries is limited to currencies that are the same as the main settlement currencies used in the Company's production operations and international investment and financing activities. The main foreign currencies include the US dollar and other currencies relevant to actual business. The types of foreign exchange hedging business conducted by the Company include but are not limited to forward foreign exchange contracts, foreign exchange swaps, foreign exchange futures, foreign exchange options, and other foreign exchange derivatives. -
Funding Scale and Sources
Based on the Company's asset scale and business needs, the scale of the foreign exchange hedging business proposed by the Company will not exceed $50 million or its equivalent in other currencies. Funds within this limit can be rolled over and reused, and the transaction amount at any point during the transaction period (including amounts related to the proceeds from the aforementioned transactions) will not exceed this limit. The foreign exchange hedging business will be conducted with banks and other financial institutions qualified for foreign exchange derivatives trading, using bank credit, margin, or option fees. The funding source for this business will be the Company's own funds and will not involve raised funds. -
Authorization and Duration
This authorization is valid for 12 months from the date of approval by the Board of Directors. -
Counterparties or Platforms
The counterparties will be banks and other financial institutions qualified for foreign exchange derivatives trading.