*ST Gaosheng (000971): Letter Of Concern

In September 19th, *ST Gaosheng (000971) issued a notice on the Shenzhen stock exchange's letter of concern.

1. the Shenzhen stock exchange asked the company to explain the reasons and rationality that the ninth session of the board of supervisors did not examine the content of the proposal at the twelfth session of the ninth session of the board of supervisors, and the reasons for and rationality of some unlawful compliance resolutions were made by the fourteenth meeting of the ninth session of the board of supervisors.

Reply: the reason and rationality that the contents of the proposal were not examined at the Twelfth Meeting of the ninth supervisory board:

The board of supervisors received the mail in July 26, 2019 and the written application in July 29th. The shareholders submitted to the board of directors at the Ping and Weng yuan (total 180109344 shares of the company's shares, representing 16.54% of the total share capital of the company at that time, accounting for 17% of the total share capital of the company), submitted a letter to the Cmi Holdings Ltd's board of supervisors to convene the provisional shareholders' meeting (hereinafter referred to as the "letter to the provisional shareholders' meeting") and the relevant shareholders' meeting motion. The board of supervisors (hereinafter referred to as the "convener") convened the Twelfth Meeting of the ninth supervisory board in July 30, 2019, and deliberated on the motion to convene the first provisional shareholders meeting of the Cmi Holdings Ltd in 2019 and issued a notice of the relevant shareholders' meeting.

At the Twelfth Meeting of the ninth supervisory committee, the legal compliance of the proposal was not examined, and it was explained at the notice of the general meeting of shareholders. It was in conformity with the provisions of the forty-eighth articles of the articles of association and complies with the provisions of laws, administrative regulations and articles of Association.

2, the story explained that the reason and rationality of some of the bills' unlawful compliance resolutions was delayed until the fourteenth meeting of the ninth supervisory board.

The opinions of the provisional shareholders meeting (hereinafter referred to as "shareholders' opinions") dissenting the motion of the first provisional shareholders meeting in 2019. The board of supervisors, as the convenor of the general assembly of the shareholders, took the responsibility of considering all the shareholders of the company and held the fourteenth meeting of the ninth supervisory board in September 8, 2019. In view of the problems raised by the shareholders' opinions, the case of the first extraordinary shareholder meeting in 2019 was re examined. It was considered that the "special instructions" of the shareholders in Ping Wen Weng yuan's letter to the convening of the provisional shareholders' meeting violated the relevant provisions of the articles of association eighty-second and eighty-third, and at the same time, according to the relevant provisions of the articles fifty-second and fifty-third of the articles of association, "special instructions". Company replies: the board of supervisors of the company received the first time submitted by some shareholders in September 5, 2019 for the first time in 2019.

Relevant motions (including motions from 2 to 7, 6 motions) shall not be submitted to the general assembly for voting and making resolutions; therefore, in accordance with relevant laws, administrative regulations and the articles of association, the board of supervisors decided to cancel the 2 motions, 2 motions, 3 motions, 4 motions, 5 motions, 6 motions and 7 motions of the first provisional shareholders' meeting in 2019.

In summary, the fourteenth meeting of the ninth supervisory board of the company made some resolutions.

3. the company's preliminary notice shows that the company's annual legal adviser is Beijing Zhong Lun law firm, and the company has also hired Beijing Zhen Bang law firm to issue a legal opinion on the fourteenth meeting of your ninth supervisory board and the first provisional shareholders' meeting in 2019. The company will explain in detail the reason and rationality of the temporary replacement of the law firm before the shareholders' meeting.

Reply: Article twelfth of the main board information disclosure Memorandum No. forty-two - related matters of shareholders' meeting forty-two: "the convener of the shareholders' meeting shall be invited by the law firm to issue a legal opinion on the relevant issues of the shareholders' meeting and make a public announcement." Since the convening of the first provisional shareholders' meeting in 2019 was the board of supervisors, the board of supervisors should hire a law firm for the first provisional shareholders' meeting in 2019. Beijing Zhen Bang law firm and Beijing Zhong Lun law firm are one of the company's regular cooperation. After considering it comprehensively, the board of supervisors has hired Beijing Zhen Bang law firm for the fourteenth meeting of the ninth supervisory board and the first provisional shareholders meeting in 2019, according to the forty-second provision of the main board information disclosure Memorandum No. twelfth - shareholders' meeting.

In summary, the board of supervisors of the company hired the Beijing Zhen Bang law firm to give testimony to the company's first provisional shareholders' meeting in 2019. The board of supervisors, according to the forty-two provisions of the twelfth memorandum on motherboard information disclosure, related matters of shareholders' meeting, is legally reasonable.