Csc Upshot Ventures Management, Llc

Allegations: CHINA SCIENCE & MERCHANTS INVESTMENT MANAGEMENT GROUP CO. LTD. ("CSM") WAS LISTED ON CHINA'S NATIONAL EQUITIES EXCHANGE AND QUOTATIONS IN 2015. IN CONNECTION WITH CSM'S OBLIGATIONS AS A PUBLIC COMPANY UNDER THE APPLICABLE CHINESE LAW, SHENZHEN OFFICE OF CHINA SECURITIES REGULATORY COMMISSION ("CSRC SHENZHEN") ALLEGED THAT (I) CERTAIN DISCLOSED RELATED PARTY TRANSACTIONS ENTERED INTO BY CSM OR ITS AFFILIATES CONSTITUTED OCCUPATION OF FUNDS, AND (II) CSM FAILED TO DISCLOSE CERTAIN OTHER TRANSACTIONS ENTERED INTO BY CSM THAT CONSTITUTED OCCUPATION OF FUNDS. SHAN XIANGSHUANG, AS THE CONTROLLING SHAREHOLDER, CONTROL PERSON AND CHAIRMAN OF BOARD OF CSM, FAILED TO TAKE THE NECESSARY STEPS TO PREVENT THE FOREGOING OCCUPATION OF FUNDS AND TO CAUSE CSM TO FULFILL ITS DISCLOSURE OBLIGATION. Status: Final Sanction Detail: CSRC SHENZHEN REQUESTED CSM TO, AND REQUESTED SHAN XIANGSHUANG TO CAUSE CSM TO (I) IMPROVE ITS ASSETS AND MANAGEMENT CONTROL, (II) TAKE NECESSARY STEPS TO PREVENT OCCUPATION OF FUNDS BY SHAREHOLDERS AND OTHER RELATED PARTIES IN THE FUTURE, AND (III) ENSURE THE QUALITY AND SUFFICIENCY OF ITS INFORMATION DISCLOSURE. Summary: CSM HAS RESTORED AND CLEANED UP ALL OF THE OCCUPATION OF FUNDS AS SPECIFICALLY MENTIONED IN THE CSRC'S DECISION AS OF AUGUST 11, 2016, TOOK NECESSARY STEPS TO PREVENT OCCUPATION OF FUNDS BY SHAREHOLDERS AND OTHER RELATED PARTIES IN THE FUTURE, COMMITTED TO (A) PROVIDE INTERNAL TRAINING OF RELEVANT CHINESE LAWS AND REGULATIONS TO ITS BOARD AND EXECUTIVE OFFICERS, (B) REQUEST ITS PERSONNEL TO COMPLY WITH RELEVANT CHINESE LAWS AND REGULATIONS, AND (C) IMPROVE ITS MANAGEMENT AND CONTROL SYSTEMS OVER INFORMATION DISCLOSURE, AND MADE A PUBLIC ANNOUNCEMENT REGARDING THE FOREGOING ON SEPTEMBER 29, 2017.

Allegations: CHINA SCIENCE & MERCHANTS INVESTMENT MANAGEMENT GROUP CO. LTD ("CSM") WAS LISTED ON CHINA'S NATIONAL EQUITIES EXCHANGE AND QUOTATIONS IN 2015. IN CONNECTION WITH CSM'S DISCLOSURE OBLIGATIONS AS A PUBLIC COMPANY UNDER THE APPLICABLE CHINESE LAW, SHENZHEN OFFICE OF CHINA SECURITIES REGULATORY COMMISSION ("CSRC SHENZHEN") ALLEGED THAT CSM FAILED TO FULLY DISCLOSE CERTAIN INFORMATION TO MEDIA PRIOR TO MAKING THE PUBLIC DISCLOSURE, AND FAILED TO CORRECT CERTAIN INFORMATION PUBLISHED ON MEDIA. CSRC SHENZHEN ALSO ALLEGED THAT SHAN XIANGSHUANG, AS THE CHAIRMAN OF BOARD AND GENERAL MANAGER OF CSM, SHALL BE RESPONSIBLE FOR CSM'S FOREGOING ACTIVITIES. Status: Final Sanction Detail: CSRC SHENZHEN REQUESTED CSM TO (I) IMPROVE ITS INFORMATION DISCLOSURE MECHANISM, (II) STANDARDIZE ITS PROCEDURES IN CONNECTION WITH TAKING MEDIA INTERVIEWS AND PUBLISHING INFORMATION IN THE MEDIA, AND (III) SUBMIT A RECTIFICATION REPORT RELATING TO CSM'S PLAN TO MAKE RELEVANT CORRECTIONS AND IMPROVEMENTS WITH 15 BUSINESS DAYS UPON THE RECEIPT OF THIS DECISION. Summary: CSM SUBMITTED THE RECTIFICATION REPORT WITHIN THE 15 BUSINESS DAYS PERIOD, COMMITTED TO (A) PROVIDE INTERNAL TRAINING OF RELEVANT CHINESE LAWS AND REGULATIONS TO ITS BOARD AND EXECUTIVE OFFICERS, (B) REQUEST ITS PERSONNEL TO COMPLY WITH RELEVANT CHINESE LAWS AND REGULATIONS, AND (C) IMPROVE ITS MANAGEMENT AND CONTROL SYSTEMS OVER INFORMATION AND DISCLOSURE, AND MADE A PUBLIC ANNOUNCEMENT ON NOVEMBER 16, 2015 TO APOLOGIZE FOR THE VIOLATION OF RELEVANT CHINESE LAWS AND REGULATIONS AND TO DISCLOSE THE CSRC SHENZHEN'S DECISION AND CSM'S CORRECTIVE PLAN.

Allegations: CHINA SCIENCE & MERCHANTS INVESTMENT MANAGEMENT GROUP CO. LTD. ("CSM") WAS LISTED ON CHINA'S NATIONAL EQUITIES EXCHANGE AND QUOTATIONS IN 2015. SHENZHEN OFFICE OF CHINA SECURITIES REGULATORY COMMISSION ("CSRC SHENZHEN") ALLEGED THAT CHINA SCIENCE HUITONG EQUITY INVESTMENT FUND ("HUITONG"), A WHOLLY-OWNED SUBSIDIARY OF CSM, FAILED TO DISCLOSE ITS CONTINUOUS PURCHASE AND HOLDING OF SECURITIES OF NETAC TECHNOLOGY CO., LTD. ("NETAC") WHEN ITS SHAREHOLDING IN NETAC REACHED 5%. SHAN XIANGSHUANG, AS THE LEGAL REPRESENTATIVE OF HUITONG, IS RESPONSIBLE FOR HUITONG'S FAILURE TO DISCLOSE. Status: Final Sanction Detail: CSRC SHENZHEN ORDERED HUITONG TO CORRECT ITS VIOLATION BY REPORTING AND MAKING PUBLIC DISCLOSURE OF ITS ABOVE 5% SHAREHOLDING IN NETAC WITHIN 3 DAYS UPON RECEIPT OF CSRC SHENZHEN'S DECISION, ISSUED A WARNING LETTER TO SHAN XIANGSHUANG REPRIMANDING HIS BEHAVIORS, AND IMPOSED A TOTAL FINE OF RMB 3,900,000, AMONG WHICH, RMB 300,000 (APPROXIMATELY, $28,570 USD) WAS IMPOSED UPON SHAN XIANGSHUANG. Summary: HUITONG MADE THE REQUISITE REPORTING AND DISCLOSURE RELATING TO ITS ABOVE 5% SHAREHOLDING IN NETAC, HUITONG AND SHAN XIANGSHUANG PAID THE MONETARY FINE, AND CSM MADE A PUBLIC ANNOUNCEMENT ON JANUARY 26, 2017 TO APOLOGIZE FOR THE VIOLATIONS BY HUITONG AND SHAN XIANGSHUANG AND COMMIT TO (A) PROVIDE INTERNAL TRAINING OF RELEVANT CHINESE LAWS AND REGULATIONS TO ITS BOARD AND EXECUTIVE OFFICERS, (B) REQUEST ITS PERSONNEL TO COMPLY WITH RELEVANT CHINESE LAWS AND REGULATIONS, AND (C) IMPROVE ITS MANAGEMENT AND CONTROL SYSTEMS OVER INFORMATION DISCLOSURE.