On January 3, Shijia Photonics announced that on July 27, 2023, the company signed a Letter of Intent with Yuhan Optoelectronics Technology (Shanghai) Co. (hereinafter referred to as "YUHAN Optronics"). The Company and YUHAN Optronics have reached a preliminary investment intention, and intends to invest RMB 150 million to RMB 200 million, and acquire up to 30% of YUHAN Optronics' equity, in order to participate in YUHAN Optronics' acquisition of Applied Optoelectronics Inc.'s (hereinafter referred to as "AOI") Chinese assets and related businesses.
Shijia Photonics pointed out that since the two parties reached a preliminary agreement on the investment, the Company has maintained close communication with the relevant parties on the acquisition and followed the significant developments of the acquisition, and received a letter of explanation from Yuhan Photonics on September 14, 2023, in which it was informed that AOI had notified Yuhan Photonics of the termination of the SPA agreement signed by the two parties in relation to the acquisition.
Subsequently, Shijia Photonics had actively communicated and negotiated with Yuhan Optoelectronics in relation to the Transaction, but the parties to the Transaction were unable to sign the formal transaction documents before December 30, 2023, and in accordance with the covenant of the Letter of Intent of the Investment that "the validity of this Letter of Intent is from the date of its signing by both parties to December 30, 2023", the Letter of Intent expired and was terminated, and the Company no longer has any intention to terminate the Letter of Intent. According to the agreement of the Letter of Intent on "the validity period of this Letter of Intent shall be from the date of signing by both parties to 30 December 2023", the Letter of Intent shall expire and be terminated, and the Company shall no longer be bound by the Letter of Intent and it does not constitute a default.
Shijia photonics said, the company signed the "letter of intent to invest" is only a cooperation between the two sides to reach a preliminary intention, the company does not need to terminate the transaction to bear compensation and legal responsibility, the termination of the transaction will not adversely affect the company's operating results, and will not affect the company's future development strategy and business planning.
Data show that Shijia photonics in recent years continue to focus on optical chip products and strengthen the investment in research and development. It is understood that the company's 400G/800G optical modules with AWG, parallel optical components, continuous wave high-power lasers and other chips and components, coherent communications with ultra-wideband dense wavelength division multiplexing AWG and other key technologies and related products, has now realized customer verification and small batch shipments. As for high-speed chips, its 50G PON EML and PAM4 100G EML are in the research and development stage; and its 25G 1286nm DFB laser has been sent to customers for verification.
