2012 Annual Report - ZTE

ANNUAL REPORT 20125. Status of liabilities and credit rating changes of the Company and debt repayments during the yearAt the end of the year, the Group’s gearing ratio was 78.93% according to the financial statements preparedunder PRC ASBEs and there was no change in the Group’s credit rating. The Bonds cum Warrants of the Grouphave a 5-year life from the date of issue. Interest is paid annually with the interest payment date falling on theanniversary of issue of the Bonds cum Warrants. The Group will pay the interest for the current year within 5business days following (and inclusive of) the interest payment date. The Group will repay the principal togetherwith interest accruable for the year within 5 working days after the maturity date of the bonds.The bonds matured on 30 January 2013 and payments of principal and interest with a total amount of RMB4,032million have been completed.6. Other informationOn 17 March 2010, the Company entered into the “Agreement for Tripartite Supervision of Issue Proceeds” withChina Development Bank, Shenzhen Branch and Guotai Junan Securities Co., Ltd. in respect of the proceedsfrom the issue of Bonds cum Warrants. On 22 March 2010, the Company received the “Notice of Replacementof Sponsor’s Representative” from Guotai Junan Securities Co., Ltd., the Company’s sponsor in respect of theissue of Bonds cum Warrants. On 23 March 2010, the “Resolution of the Company on the Replacement ofInternal Funds Previously Invested in Issue Proceed Investment Projects with Proceeds from the Issue of Bondscum Warrants” was passed at the Thirty-fourth Meeting of the Fourth Session of the Board of Directors of theCompany. For details of the aforesaid matters, please refer to the “Overseas Regulatory Announcement” of theCompany dated 17 and 24 March 2010. The use of proceeds from the Company’s issue of Bonds cum Warrantsis discussed in the section headed “(II) Management Discussion and Analysis Prepared in accordance with PRCASBEs” in “Report of the Board of Directors” of this report.(VII) INFORMATION ON THE CORPORATE BONDS OF THE COMPANY1. Information on the issue of corporate bonds by the CompanyTo meet the Company’s working capital requirements, further improve its debt structure and lower its finance costs,the Company was given approval to issue corporate bonds with a nominal value of not more than RMB6 billionat an issue price of RMB100 each in accordance with relevant provisions of the Company Law of the People’sRepublic of China, Securities Law of the People’s Republic of China, Trial Measures for the Issue of CorporateBonds and other pertinent laws, regulations and regulatory documents, following consideration and approval atthe Twenty-sixth Meeting of the Fifth Session of the Board of Directors of the Company held on 8 March 2012and the First Extraordinary Meeting of 2012 of the Company held on 11 April 2012 and approval by the CSRCby virtue of the document Zheng Jian Xu Ke [2012] No. 754. The Issue was conducted by way of a combinationof online offering to public investors and offline bid placing to institutional investors.73