Dream Garden Receives Supplementary Materials Request for Overseas Listing Filing, Focusing on Termination Arrangements for Special Shareholder Rights and Verification of Business Qualifications Across Multiple Fields

NewTimeSpace News: Recently, Shandong Huawutang Cosmetics Co., Ltd. (Dream Garden) has received a request for supplementary materials from regulatory authorities during the filing process for its overseas listing.

As required, the company shall firstly clarify whether there exist affiliated relationships among shareholders with a shareholding ratio below 5%. If any affiliation exists, it shall specify whether their shareholdings should be combined for calculation. Where the combined ratio exceeds 5%, thorough background checks shall be conducted in accordance with the standards applicable to shareholders holding more than 5% stakes. Secondly, the company needs to elaborate on the reasonableness of the share subscription prices for new shareholders added in the latest 12 months and the reasons for price discrepancies among different shareholders, and deliver conclusive opinions on whether the pricing is fair and reasonable and whether any interest transfer exists.

Thirdly, the company shall specify the composition and employment status of personnel participating in the equity incentive plan, and verify whether these participants have affiliations with other shareholders, directors, supervisors and senior management of the company, as well as whether any personnel prohibited by laws and regulations from participating in corporate equity incentives are included. Conclusive opinions shall also be issued on the fairness of subscription prices, contractual terms, decision-making procedures and standardized operation, as well as the legality and compliance of the incentive plan and the existence of interest transfer. Fourthly, the full details of special shareholder rights arrangements, specific termination clauses and adopted decision-making procedures shall be disclosed. The company shall confirm whether all shareholders have reached a consensus and if any disputes exist, and whether the above circumstances constitute substantial obstacles to this overseas listing.

Fifthly, the company shall present details of its obtained business qualifications. In accordance with the 2024 Special Administrative Measures (Negative List) for the Access of Foreign Investment, it shall verify whether the businesses and business scopes of the company and its subsidiaries involve fields restricted or prohibited under the negative list for foreign investment, and confirm continuous compliance with foreign investment access policies before and after this listing and full circulation. It shall also specify the contract terms and specific cooperation models with major OEM suppliers. In addition, the company needs to explain the actual development of various businesses within its business scope and that of domestic subsidiaries, including food sales, advertising, navigation and mapping, electric vehicle charging facilities, new energy vehicle sales, health food and property management, and confirm whether all necessary qualifications and permits have been obtained and whether the aforesaid businesses are actually in operation. Sixthly, the company shall disclose whether the shares held by shareholders participating in the full circulation arrangement are pledged, frozen or encumbered with other rights defects. Legal counsel shall complete relevant verification procedures and issue explicit legal opinions on all the above items.