AVIC Securities Co., Ltd. Audit Opinion on China Porcelain Electronics Technology Co., Ltd.'s Use of Partial Idle Raised Funds to Temporarily Supplement Working Capital
AVIC Securities Co., Ltd. ("AVIC Securities" or "Independent Financial Advisor"), as the independent financial advisor for the issuance of shares by Hebei China Porcelain Electronics Technology Co., Ltd. (hereinafter referred to as "the Company," "the Listed Company," or "China Porcelain Electronics") to purchase assets and raise supporting funds, and the associated connected transaction (hereinafter referred to as "Major Asset Restructuring"), has, in accordance with the "Supervision Regulations for the Management of Raised Funds by Listed Companies," "Shenzhen Stock Exchange Listed Company Self-Regulatory Guidelines No. 1 - Normative Operation of Main Board Listed Companies," and other relevant laws and regulations, audited the matter of China Porcelain Electronics using part of its idle raised funds to temporarily supplement working capital. The details are as follows:
I. Basic Situation of Raised Funds
As per the "Approval on the Registration of the Issuance of Shares by Hebei China Porcelain Electronics Technology Co., Ltd. to Purchase Assets and Raise Supporting Funds" (Issuance Registration Approval [2023] No. 1519) issued by the China Securities Regulatory Commission, the Company was approved to issue shares to 7 counterparties, including China Electronics Technology Group Corporation's 13th Research Institute, to purchase relevant assets, and to raise supporting funds not exceeding RMB 2.5 billion through share issuance. The shares to be issued in this targeted offering for supporting funds are domestic A-shares with a par value of RMB 1.00 per share. Dahua Certified Public Accountants (Special General Partnership) issued the "Capital Verification Report on the Company's Issuance of 29,940,119 A-shares" (Dahua Verification [2023] No. 000647) on November 1, 2023. Upon verification, as of October 31, 2023, China Porcelain Electronics issued 29,940,119 A-shares at a price of RMB 83.50 per share, raising a total of RMB 2,499,999,936.50. After deducting issuance-related expenses of RMB 37,309,377.46, the net amount of raised funds is RMB 2,462,690,559.04. The Company has implemented a special account deposit system for the raised funds, ensuring they are used for their intended purpose.
II. Situation of Raised Fund Investment
According to the Company's "Report on the Issuance of Shares to Purchase Assets and Raise Supporting Funds and Connected Transactions," the raised funds from the major asset restructuring are planned to be invested in the following projects after deducting restructuring-related expenses: