Stock abbreviation: Roshow Technoiogy Co.Ltd(002617) Stock Code: Roshow Technoiogy Co.Ltd(002617) about Roshow Technoiogy Co.Ltd(002617)
Application documents for non-public offering of A-Shares in 2021
Reply to secondary feedback
Sponsor (lead underwriter)
No. 618, Shangcheng Road, China (Shanghai) pilot Free Trade Zone
April, 2002
China Securities Regulatory Commission:
According to the notice of the CSRC on the second feedback on the examination of administrative licensing projects (No. 213585) (hereinafter referred to as the “feedback”) issued by your commission on March 29, 2022, Roshow Technoiogy Co.Ltd(002617) (hereinafter referred to as ” Roshow Technoiogy Co.Ltd(002617) ,” company “,” issuer “or” applicant “) and the recommendation institution Guotai Junan Securities Co.Ltd(601211) (hereinafter referred to as the” recommendation institution “) Guohao law firm (Hangzhou) (hereinafter referred to as “lawyer” and “applicant’s lawyer”) and Zhitong accounting firm (special general partnership) (hereinafter referred to as “accountant” and “applicant’s accountant”) have carefully checked and implemented the problems involved in the feedback one by one. The reply is as follows, please review.
explain:
1. Unless otherwise specified, all values in this feedback reply shall be kept to two decimal places. If the sum of the values of each sub item is inconsistent with the mantissa of the total, it is caused by rounding.
2. Unless the context otherwise requires, the abbreviation in this reply has the same meaning as the abbreviation in Guotai Junan Securities Co.Ltd(601211) due diligence report on non-public development of A-share shares in Roshow Technoiogy Co.Ltd(002617) 2021 (hereinafter referred to as “due diligence report”).
3. The font in this feedback reply represents the following meanings:
Questions listed in bold (not bold) feedback
Song typeface reply to the questions listed in the feedback
catalogue
Question 1. About Bourne Luxiao repurchase, the issuer holds all its shares 3 question 2. About the acquisition 11 question 3. About equity pledge 49 question 4. About raised investment 57 question 5. About other receivables eighty-two
Question 1. About the buyback of burnluxiao, the applicant holds all of its shares
Bourne Luxiao was originally a joint-stock company with 40% shares held by the applicant. On January 22, 2019, the 19th meeting of the Fourth Board of directors of the applicant deliberated and approved the proposal on the proposed signing of major agreements and related party transactions, agreed that the applicant withdraw all its investment in Bourne Luxiao, and Bourne Luxiao repurchased all the equity of the applicant in Bourne Luxiao. On February 14, 2019, the applicant’s second extraordinary general meeting of shareholders in 2019 deliberated and confirmed the above repurchase matters. The total amount of equity contribution signed by the applicant and Lu xiaobern (xiaobern) is RMB 888000, which is the total amount of equity contribution of Huizhou xiaobern Co., Ltd. on the same day The asset repurchase company with a total value of 487 million yuan holds 40% of the equity of Bourne Luxiao (including the paid in contribution of 500 million yuan and the unpaid contribution of 92 million yuan, as well as its representative and corresponding capital, capital reserve, discretionary reserve, undistributed profits and shareholders’ rights and obligations). According to the agreement, Bourne Luxiao took all the two plants and land of the first workshop and the second workshop, 513 sets of 80 kg KY long crystal furnace equipment stored in the first, second and third workshops, 17 sets of 80 kg KY long crystal furnace equipment in the Fifth Workshop and class B KY sapphire crystals with overstocked inventory as the transaction consideration of this repurchase. On June 25, 2019, the 26th meeting of the Fourth Board of directors of the applicant deliberated and approved the proposal on the proposed signing of major agreements and related party transactions, and agreed that the applicant and Bourne Luxiao and Bourne optics (Huizhou) Co., Ltd. sign the supplementary agreement of the agreement on the above agreement. On July 1, 2019, the applicant’s fourth extraordinary general meeting of shareholders in 2019 reviewed and confirmed the signing of the above supplementary agreement to the agreement. The supplementary agreement to the agreement mainly refers to the audit and evaluation results of the audit and evaluation institutions on the assets of Bourne Luxiao as of October 31, 2018, adjusts the total price of equity repurchase, changes the transaction price to RMB 474 million, and confirms that the number of class B KY sapphire crystals as the transaction consideration is 385. In January 2021, the applicant reached an agreement with Bourne Luxiao. The applicant offset the factory and dormitory rent payable to Bourne Luxiao, liquidated damages of relevant litigation between both parties, asset evaluation expenses and other debts with the creditor’s rights of 385 class B KY sapphires of Bourne Luxiao, that is, Bourne Luxiao does not need to deliver 385 class B KY sapphires to the company.
The applicant is requested to: (1) list in detail the details of the assets involved in the first consideration and the evaluation price, and explain the reasons and rationality of the significant changes in the assets involved in the consideration of the repurchase transaction; (2) Explain in detail the reasons and basis for the occurrence of relevant debts involved in the offset of creditor’s rights and debts between the applicant and bernlusiao, and check whether they are consistent with the related transactions and related transactions disclosed in the previous year; (3) Explain whether the above transactions seriously infringe the interests of the listed company.
Verification opinions.
[reply]
1、 List in detail the details of assets involved in the first consideration and the evaluation price, and explain the reasons and rationality of the significant changes in assets involved in the consideration of repurchase transaction
(I) reasons why Bourne Luxiao repurchased the shares held by the issuer with physical assets
Before participating in Bourne Luxiao, Lutong Electromechanical, a subsidiary of Roshow Technoiogy Co.Ltd(002617) has mastered the manufacturing process of sapphire long crystal furnace equipment, and sapphire chips are expected to be widely used in Apple mobile phones and watch screens, with broad market prospects. Based on the above situation, Bourne optics (Huizhou) Co., Ltd. (hereinafter referred to as “Bourne optics”) took the initiative to find Roshow Technoiogy Co.Ltd(002617) , It is hoped that a company specializing in sapphire crystal growth and processing will be established through joint venture to give full play to the technical advantages of Roshow Technoiogy Co.Ltd(002617) existing sapphire long crystal furnace and the crystal growth, processing and sales capacity of Bourne optics. After full investigation and feasibility study, Roshow Technoiogy Co.Ltd(002617) decided to cooperate with Bourne Luxiao and expand the sapphire business industrial chain of Roshow Technoiogy Co.Ltd(002617) by participating in the establishment of Bourne Luxiao, as the entry point for the company’s transformation to high-end manufacturing and emerging industries.
In April 2014, after the deliberation and approval of the 23rd Meeting of the second board of directors of the company, the company and Bourne optics signed the agreement on investment in the establishment of Bourne Luxiao sapphire Co., Ltd. to jointly invest in the establishment of Bourne Luxiao, Roshow Technoiogy Co.Ltd(002617) investment ratio is 40%, Bourne optics investment ratio is 60%, and Bourne Luxiao is mainly engaged in sapphire crystal growth and processing business. At the same time, burnluxiao is also a key investment attraction project of Horqin district government of Tongliao City. The government provides support in infrastructure, land, taxation and other aspects.
After the establishment of Bourne Luxiao, Bourne optics, as the controlling party holding 60% of the shares, plays a leading role in the business activities of Bourne Luxiao, but the performance of Bourne Luxiao is far from expected. From 2014 to 2018, Bourne Luxiao’s net profits were -8.4911 million yuan, – 103446 million yuan, – 29.849 million yuan, – 18.558 million yuan and -160624 million yuan respectively, and the amount of loss showed a rapid increasing trend.
Since 2017, Roshow Technoiogy Co.Ltd(002617) has repeatedly negotiated and communicated with the partner Bourne optics and the person in charge of operation and management of Bourne Luxiao, and proposed practical measures to improve the business performance of Bourne Luxiao through expanding sales channels and raising product prices, but Bourne Luxiao has never achieved the expected business objectives. When Bourne optics subsequently asked the issuer to increase the capital of Bourne Luxiao, the issuer did not actually make capital contribution for the time being due to prudence.
Roshow Technoiogy Co.Ltd(002617) considering that Bourne Luxiao has been in a state of loss since its establishment and the prospect of cooperation is uncertain, in the second half of 2018, Roshow Technoiogy Co.Ltd(002617) and Bourne optics made many efforts to communicate under the coordination of Horqin district government to promote win-win cooperation, but failed. After the coordination of Horqin District government, Roshow Technoiogy Co.Ltd(002617) and Bourne optics agreed to terminate the cooperation. As for the implementation plan of terminating the cooperation, Roshow Technoiogy Co.Ltd(002617) proposed to separate Bourne Luxiao in accordance with the company law, or Bourne optics purchased the shares held by Roshow Technoiogy Co.Ltd(002617) in cash, and negotiated with Bourne optics for many times, but there was no substantive progress. Finally, under the coordination of Horqin district government, in November 2018, witnessed by the representatives of Horqin district people’s Government of Tongliao City, Inner Mongolia Autonomous Region, Roshow Technoiogy Co.Ltd(002617) and Bourne optics signed the memorandum on share repurchase scheme of Bourne Luxiao sapphire Co., Ltd. with assets, and all parties agreed that Bourne Luxiao would repurchase the shares held by Roshow Technoiogy Co.Ltd(002617) with assets.
To sum up, Roshow Technoiogy Co.Ltd(002617) withdrawing from the investment in bernluxiao is a decision made when bernluxiao has suffered losses for many years, the investment benefit is far from expected, and other schemes cannot be effectively implemented; Horqin district government has coordinated for many times, and both parties have agreed that Bourne Luxiao will repurchase the shares held by Roshow Technoiogy Co.Ltd(002617) with physical assets.
(II) the details of the assets involved in the first consideration and the evaluation price, indicating the reasons and rationality of the significant changes in the assets involved in the consideration of the repurchase transaction
On February 14, 2019, the issuer’s second extraordinary general meeting of shareholders in 2019 deliberated and confirmed the repurchase of 40% equity of burnluxiao (hereinafter referred to as the “first consideration”), and the first consideration was 487 million yuan of assets, including the two plants and land held by burnluxiao in the first workshop and the second workshop, and 513 sets of 80 kg KY long crystal furnace equipment stored in the first, second and third workshops, 17 sets of 80kg KY long crystal furnace equipment in the Fifth Workshop and class B KY sapphire crystals with overstocked inventory.
On June 25, 2019 and July 1, 2019, the 26th meeting of the Fourth Board of directors of the issuer and the 4th extraordinary general meeting of shareholders in 2019 considered and adopted the supplementary agreement to the agreement respectively. Referring to the audit and evaluation results of the audit and evaluation institutions on the assets of bernlusiao as of October 31, 2018, the total price of equity repurchase was adjusted, and the transaction price was changed to RMB 474 million, At the same time, it is confirmed that the transaction consideration is the two plants and land of the first workshop and the second workshop, 513 sets of 80kg KY long crystal furnace equipment stored in the first, second and third workshops, 17 sets of 80kg KY long crystal furnace equipment in the Fifth Workshop and 385 class B KY sapphire crystals in stock (hereinafter referred to as the “final consideration”).
According to the asset appraisal report of relevant assets issued by Beijing Guorong Xinghua Assets Appraisal Co., Ltd. in May 2019 (Guorong Xinghua pingbao Zi [2019] No. 020063), the book value and appraisal value of relevant assets as consideration as of October 31, 2018 are as follows:
Unit: 10000 yuan
Increase or decrease in book value
Project details (excluding tax) (excluding tax) (excluding tax) value-added rate% a B C = B-A d = C / A 100%
385 class B KY sapphire 100551 995.69 -9.82 -0.98 crystal balls in stock
Fixed assets 40743324090046 157.28 0.39
Including: house 1 workshop 133057150959 179.02 13.45
Plant building
1 workshop low voltage cable system 172.70 191.04 18.34 10.62
1 workshop high and low voltage power distribution system 446.81 494.29 47.48 10.63
1 workshop circulating cooling water system 759.11 839.76 80.65 10.62
2 workshop low voltage cable system 183.32 200.45 17.12 9.34
High and low voltage power distribution system of machine and equipment workshop 2 438.01 478.91 40.90 9.34
2 workshop circulating cooling water system 613.12 670.38 57.26 9.34
Active filter power supply 66.62 62.36 -4.26 -6.40
Sapphire long
