Fundraising Overview - The company, Zhejiang Kanglongda Special Protective Technology Co., Ltd., issued 2,000,000 convertible bonds on April 23, 2020, with a face value of RMB 100 each, raising a total of RMB 200 million [1] - The funds raised were managed under a dedicated account system, in compliance with relevant laws and regulations [1][2] Fund Management and Supervision - The company established a fundraising management system and signed a tripartite supervision agreement with its sponsor, CITIC Securities, and Bank of China, ensuring proper management and usage of the funds [1] - The dedicated accounts were opened at Bank of China and China Minsheng Bank, with specific account numbers provided [3][2] Account Cancellation - On June 11, 2025, the company’s board and supervisory board approved the termination of an investment project related to the production of high-performance polyethylene fibers and decided to permanently supplement the remaining funds into working capital [3][4] - As of July 1, 2025, the company transferred a total of RMB 89,725,510.27, including interest income, to its ordinary account and completed the cancellation of the dedicated fundraising accounts [4][5]

Core Viewpoint - The company, Kanglongda, has decided to terminate its project for producing 2,400 tons of multifunctional, high-performance polyethylene fibers due to industry challenges and financial inefficiencies [1][3]. Group 1: Project Termination - The project aimed at producing 2,400 tons of multifunctional, high-performance polyethylene fibers has been halted, with remaining funds of 89.72 million yuan redirected to supplement working capital [1]. - The decision to terminate the project will be subject to approval at the company's shareholder meeting [1]. Group 2: Industry Context - As of June 2024, the company's production capacity for ultra-high molecular weight polyethylene (UHMWPE) fibers is approximately 1,000 tons per year, primarily serving defense and police sectors [2]. - The industry has faced a slowdown in growth, leading to existing capacities meeting current demand, which diminishes the need for new production lines [3]. Group 3: Financial Performance - In 2024, the company reported revenues of 1.52 billion yuan, a decrease of 2.73% year-on-year, with net losses widening from 220 million yuan to 486 million yuan [6]. - The first quarter of 2025 showed a revenue increase of 42.18% year-on-year, with a turnaround in net profit from a loss of 64.58 million yuan to a profit of 114 million yuan [7]. Group 4: Competitive Landscape - The industry is experiencing intensified competition, with product prices declining due to homogenization and recent export controls further squeezing profit margins [4]. - The company's investment products reported a loss of 2.29 million yuan in 2024, indicating a risk of declining returns on further investments [4]. Group 5: Company Overview - Kanglongda specializes in the research, production, and sales of special and ordinary labor protection gloves, focusing on providing comprehensive hand protection solutions [5].

Core Viewpoint - The company has decided to terminate the "Annual Production of 2,400 Tons of Multifunctional, High-Performance, High-Strength, High-Modulus Polyethylene Fiber Project" due to industry growth slowdown, intensified competition, and the need to improve capital efficiency [1] Group 1 - The remaining raised funds of 89.7245 million yuan will be permanently used to supplement working capital [1] - The project has accumulated an investment of 107 million yuan, with an investment progress of 55.58% [1] - The termination of the project is subject to approval at the shareholders' meeting [1]