Incident: On September 26, the company signed a “Strategic Cooperation Framework Agreement” (“Strategic Cooperation Agreement”) with the China Aerospace Aerodynamics Technology Research Institute (“11th Aerospace Institute”). It will carry out strategic cooperation with the 11th Aerospace Academy in aerodynamic engine technology research and development, aerodynamic equipment development and testing, small and medium-sized aerodynamic engine manufacturing, aerodynamics technology innovation platform construction, etc., and plans to invest in 40% of the shares in Chongqing Zongshen Aero Engine Manufacturing Co., Ltd. (under construction). Comment: 1. An exclusive agreement was signed with the 11th Aerospace Academy. The 11th Academy of Military Drone Propulsion and Acceleration belongs to the China Aerospace Science and Technology Corporation. It is the former Aerospace 701 Institute, leading the technology for integrated unmanned reconnaissance aircraft. Earlier, Zongshen and the 11th Academy had already begun collaborative research and development on Rainbow 3 and Rainbow 4. Meanwhile, on November 6, 2015, the company increased the capital of Shenfei Company (responsible for the manufacture of Rainbow 3 and 4 series drones) and obtained 16.7% of the shares. According to Nanyang Technology's announcement, there are two special aerospace equipment manufacturing companies under the 11th Aerospace Academy: Rainbow Drone Technology Co., Ltd. (Drone Company) and Aerospace Shenzhou Aircraft Co., Ltd. (Shenfei). Currently, Shenfei is mainly responsible for the manufacture of Rainbow 3 and 4 series drones, while drone companies are mainly responsible for manufacturing other spacecraft such as multi-rotors and hand-thrown spacecraft. Previously, the company's cooperation with the Eleventh Academy was limited to providing engine power components for Rainbow 3 and 4 through Shenfei. However, Shenfei's participation of 40% in the Zongshen Aero Engine Company, which is controlled by Zongshen, represents a further upgrade of the company's cooperation with the 11th Academy. It is expected that the future will not only focus on engines, but also on current cooperative models. It is expected that the cooperation space will open up, and the binding relationship with the 11th Academy will further deepen. Most importantly, the 11th Academy's participation in Zongshen Aero Engine Co., Ltd. represents the formal beginning of the cooperation between Zong Electric Power and the Eleventh Institute from cooperative research and development and prototype trial production to batch supply through a new platform. 2. Absolute leader in domestic motorcycle engines and general machinery. Steady main business provides stable cash flow, absolute leader in domestic motorcycle engines and general machinery power systems. The main business is mature and stable, providing stable cash flow support for business expansion. The company has accumulated more mature parts manufacturing technology and upstream and downstream resources, and has complete production lines and human resources reserves for die-casting, coating, machining, etc. In the context of motorcycle bans and motorcycle restrictions, the company has successively entered the parts procurement system of domestic automakers and has begun supplying parts and components such as boxes and cylinder blocks to automakers. At the same time, we are actively upgrading our business and signing an agreement in the field of robotics with Chongqing University. The two sides are carrying out cooperative R&D, design, and planning in the field of fieldrobots such as garden robots, snow plowing robots, and lawn mowing robots. Promote the industrialization of research and development results by establishing a platform for scientific research cooperation and exchange, and establishing a platform for talent training and human resource sharing. Risk warning: Project progress falls short of expectations.