*ST Gaosheng (000971): Progress In The Acquisition Of Hua Qi Communications Transactions

Stock Code: 000971 securities short: *ST, Gao Sheng Announcement No.: 2020-25

Gaosheng Cmi Holdings Ltd's announcement on the acquisition of Hua Qi communications transaction matters

All members of the company and the board of Directors ensure that the contents of the announcement are true, accurate and complete, without false records, misleading statements or major omissions.

The progress made by Gaosheng Cmi Holdings Ltd (hereinafter referred to as the "company") to acquire Beijing Hua Qi Communication Technology Co., Ltd. (hereinafter referred to as "Hua Qi communications") is as follows:

I. major asset restructuring

In May 2, 2018, the company received the approval issued by the China Securities Regulatory Commission (CSRC) on Approving the purchase of assets and raising matching funds by the Gaosheng Cmi Holdings Ltd to Liu Feng Qin and other shares issued by the securities and Futures Commission (SFC [2018]757), and former permitted company to the original shareholders of Beijing Hua Qi Communications Technology Co., Ltd. (hereinafter referred to as "the original shareholder of Hua Qi"), Liu Fengqin, and 55 natural persons and Jun Feng. Huayi emerging industries investment fund (hereinafter referred to as "Junfeng fund") purchased 99.997% stake in Hua Qi communications through issuing shares and paying cash. The original shareholders of the company and Hua Qi communications signed the agreement on the issue of shares and the payment of assets for cash in December 11, 2017, and the supplementary agreement for the issuance of shares and the payment of assets for cash in January 16, 2018. The agreement stipulated that 55% (505 million 434 thousand and 800 yuan) of the total consideration should be paid by the company issuing shares, and the other 45% (41). 3 million 534 thousand and 800 yuan) paid by the company in cash.

In June 12, 2018, Dongcheng Branch of the Beijing Administration for Industry and Commerce approved the change of the shareholder of Hua Qi communications. The 99.997% stake in Hua Qi communications held by the other party has been transferred to the list of listed companies.

Two, payment of equity consideration.

(1) payment by issuing shares.

On October 2018 26, the company issued 33450344 shares to the 26 natural persons such as Liu Fengqin, the trading party. At this point, the company completed the consideration of the share price according to the original shareholders of Huaqi communications.

(two) cash payment consideration

In April 27, 2018, the China Securities Regulatory Commission issued the "approval of Gaosheng Cmi Holdings Ltd's issue of shares to Liu Fengqin and the purchase of assets and raise matching funds" (SFC license No. [2018]757). Former permitted company issued a total of 66856456 shares to 26 natural persons, such as Liu Feng Qin, to purchase related assets; and the amount of matching funds for former permitted company non-public offering shares was not more than 45. 3 million 830 thousand yuan. The reply is valid within 12 months from the date of issuance. Due to the expiration of the validity period of the approval, the company can not raise the equity cash consideration through the non-public offering shares, and the company must pay by itself.

1, up to now, the company has paid a cash consideration of 189 million 186 thousand and 800 yuan.

2. Deferred payment part

The company owed five shareholders, such as Liu Fengqin and other 152 million 926 thousand and 100 shareholders, and the total price was 152 million 926 thousand and 100 yuan. In April 24, 2020, the company signed a supplementary agreement with the five original shareholders to issue shares and pay cash to purchase assets (hereinafter referred to as "supplementary agreement").

(two)) the main contents of the agreement are:

(1) Junfeng fund

After paying $65 million in December 26, 2019, the balance of arrears was 86 million 243 thousand and 800 yuan. The payment plan is as follows:

A. paid 1 million 510 thousand yuan of liquidated damages up to December 26, 2019 and paid in April 25, 2020.

B. assumes a legal cost of 1/2 yuan and 2 million 375 thousand and 800 yuan before payment in May 31, 2020.

C. assumes the interest rate for deferred payment is 6% of the annualized rate. The interest is calculated on the basis of the balance of 86 million 243 thousand and 800 yuan in December 26, 2019.

D. paid 15 million (including 13 million 260 thousand yuan in principal, interest 1 million 740 thousand) in April 25, 2020, and paid 75 million 250 thousand yuan (including 72 million 980 thousand yuan in principal and interest 2 million 270 thousand yuan) before October 29, 2020.

E. if it breaks the contract again, it will receive 12% penalty on the part of the default.

(2) payment of four individual shareholder arrangements such as Liu Fengqin

By January 6, 2020, the company paid Liu Fengqin, Fu Gangyi, Fang Yu and Li Wei four yuan 104 million 476 thousand and 700 yuan, the arrears balance was 79 million 943 thousand and 100 yuan, the arrears payment plan agreed as follows:

Since January 6, 2020, the cost of deferred payment has been paid on the basis of the balance of arrears of RMB 79 million 943 thousand and 100 yuan, which is paid at the rate of 6% per annualized rate. The company plans to pay a total of 25 million yuan including the share transfer price and the interest earned during the capital occupation by September 30, 2020, and will pay the remaining share transfer price and the total interest rate during the period of capital occupation up to 54 million 940 thousand yuan by November 30, 2021. Liu Fengqin and other four people are exempt from liability for breach of contract due to deferred payment of cash consideration before January 6, 2020.

3, pay the remaining shareholders arrangement

The company has recently arranged to pay the remaining shareholders' debts totaling 40 million 560 thousand yuan with its own funds.

The balance is paid when the personal income tax is paid.

(three) the actual payment and statement of the supplementary agreement (two).

1, in accordance with the above agreement, the company paid a sum of 1 million 510 thousand yuan for breach of the Junfeng fund in April 24, 2020, 13 million 260 thousand yuan for equity transfer and 1 million 740 thousand for capital occupation, totaling 16 million 510 thousand yuan.

2, the interest rate of the delayed capital occupancy fee in the above agreement is 6% of the annual interest rate, and the floating interest rate is 30% based on the interest rate of the same period of the bank.

3, the agreement agreed to pay the Junfeng fund 75 million 250 thousand yuan before October 29, 2020, and the total interest of Liu Fengqin and other four shareholders in the transfer of shares and the total interest during the period occupied by the fund will be 54 million 940 thousand yuan before November 30, 2021. The arrangement of funds in the company agreement is made according to the actual business conditions, and is expected to be paid on time and will not touch the penalty clause.

Notice hereby

Gaosheng Cmi Holdings Ltd board two O two O April 24th