Group 1 - The core transaction involves Guangzhou Silin Jie Technology Co., Ltd. issuing shares and paying cash to acquire 71% of Qingdao Kekai Electronic Research Institute Co., Ltd. and raising supporting funds [15][17] - The transaction is classified as a major asset restructuring under the relevant regulations [15][17] - The total cash consideration for the transaction is set at 85.7 million yuan, with 56.3 million yuan paid in shares [17] Group 2 - The company plans to raise supporting funds not exceeding 100% of the transaction price through the issuance of shares to no more than 35 specific investors [19][21] - The funds raised will be used to cover cash consideration, intermediary fees, and related taxes [19][21] - The issuance of shares will not exceed 30% of the company's total share capital prior to the transaction [19][21] Group 3 - The independent financial advisor for the transaction is Minsheng Securities Co., Ltd. [5] - The legal advisor is Shanghai Zechang Law Firm, and the auditing firm is Xinyong Zhonghe Accounting Firm [5] - The asset evaluation was conducted using the income approach, with a valuation of 210.2 million yuan for the target company [17]

Core Viewpoint - Guangzhou Silin Jie Technology Co., Ltd. is undergoing a significant transaction involving the acquisition of 71% equity in a target company through a combination of share issuance and cash payment, with a total transaction value of approximately 1.42 billion yuan [1][2]. Transaction Details - The company plans to pay 591 million yuan in shares to other shareholders and 900 million yuan in cash to the actual controller of the target company, with an additional 500 million yuan to be paid within 10 working days after the completion of the share transfer and fundraising [1]. - The cash portion of the transaction includes 500 million yuan sourced from raised funds, with alternative financing options available if fundraising fails, including potential bank loans covering up to 60% of the transaction price [1][2]. Performance and Compensation Arrangements - The performance compensation agreement stipulates that if the actual net profit for 2026 and 2027 falls below 90% of the promised net profit, the compensation party will be obligated to compensate for the shortfall [1][3]. - The transition period profits from the target shares will be enjoyed by the company, except for a maximum of 30% of the net profit for 2024, capped at 28 million yuan [1]. Financial Projections and Valuation - The target company is projected to achieve net profits of 90 million yuan, 120 million yuan, and 140 million yuan for the years 2025, 2026, and 2027, respectively, with a cumulative profit commitment of 540 million yuan [6][7]. - The valuation of the target company was assessed using both asset-based and income approaches, with the income approach yielding a valuation of 2.1 billion yuan, reflecting a significant increase of 128.10% compared to the asset-based valuation of 1.01 billion yuan [18][19]. Industry Context - The defense and military modernization sector is experiencing high demand, with China's defense budget projected to reach 1.78 trillion yuan in 2025, marking a 7.2% increase [11][12]. - The target company operates in a high-barrier industry with strong customer loyalty, particularly in the military sector, which is characterized by stable long-term contracts with major defense groups [11][12].

Core Viewpoint - The document provides a supplementary legal opinion regarding Guangzhou Silin Jie Technology Co., Ltd.'s issuance of shares and cash payment for acquiring 71% of Qingdao Kekai Electronics Research Institute Co., Ltd. and raising supporting funds through related transactions [1][2]. Group 1: Transaction Overview - The overall transaction plan consists of issuing shares and cash payment to acquire 71% of Kekai Electronics and raising up to 500 million yuan through issuing shares to no more than 35 specific investors [4][5]. - The total transaction price for the acquisition is 1.42 billion yuan, with 563 million yuan paid in shares and 857 million yuan in cash [5][6]. Group 2: Pricing and Issuance - The issuance price for the shares is set at 16.74 yuan per share after adjustments for dividends, which is above the minimum required price of 80% of the market reference price [6][8]. - The number of shares to be issued is calculated based on the total share payment divided by the issuance price, resulting in approximately 33.63 million shares, representing 33.53% of the post-issuance total share capital [8][9]. Group 3: Regulatory Compliance - The transaction has undergone necessary decision-making and approval processes, including resolutions from the board of directors and supervisory board, and is pending approval from the Shanghai Stock Exchange and registration with the China Securities Regulatory Commission [10][11]. - The transaction is classified as a related party transaction due to the expected shareholding exceeding 5% by certain parties post-transaction, necessitating compliance with relevant regulations [17]. Group 4: Financial and Legal Due Diligence - The legal opinion confirms that all necessary documents and materials have been provided for the transaction, ensuring the accuracy and completeness of the information [3][4]. - The target company, Kekai Electronics, has been recognized as a high-tech enterprise, qualifying for a reduced corporate income tax rate of 15% for three years starting from 2023 [15][16]. Group 5: Assets and Liabilities - Kekai Electronics holds 22 authorized patents, including 6 defense invention patents, and has a total of 160 registered copyrights [12][13]. - As of the baseline date, Kekai Electronics reported no short-term debt and a long-term debt of approximately 99.1 million yuan [14][16].