证券代码（A/H）：000063/00763 证券简称(A/H)：中兴通讯 公告编号：202553

中兴通讯股份有限公司

关于按照《香港上市规则》公布

H 股可转换债券发售通函

本公司及董事会全体成员保证信息披露的内容真实、准确和完整，没有虚假记载、误导性陈述或重大遗漏。

中兴通讯股份有限公司根据《香港联合交易所有限公司证券上市规则》（简称“《香港上市规则》”）规定，在香港联合交易所有限公司披露易网站（www.hkexnews.hk）刊登了 H 股可转换债券发售通函。

根据《深圳证券交易所股票上市规则》关于境内外同步披露的要求，特将有关公告同步披露如下，供参阅。

特此公告。

中兴通讯股份有限公司董事会

2025年8月6日香港交易及結算所有限公司及香港聯合交易所有限公司對本公告的內容概不負責，

對其準確性或完整性亦不發表任何聲明，並明確表示，概不對因本公告全部或任何部份內容而產生或因倚賴該等內容而引致的任何損失承擔任何責任。

本公告及當中所述的上市文件僅按香港聯合交易所有限公司證券上市規則（「上市規則」）規定刊發以供參考，且並不構成任何證券的出售要約或招攬購買要約。本公告或當中所述任何事宜（包括上市文件）一概並不組成任何合約或承諾的基準。為免生疑，刊發本公告及當中所述的上市文件不應被視為根據發行人（定義見下文）或其代表就香港法例第32章《公司（清盤及雜項條文）條例》而言刊發章程作出證券發售，亦並不構成就香港法例第571章《證券及期貨條例》而言包含邀請公眾人士訂立或要約

訂立協議以收購、處置、認購或包銷證券的廣告、邀請或文件。

本公告並非供於美國（包括其領地及屬土，美國任何一個州及哥倫比亞特區）直接或間接分發。本公告及其所載資料並不構成或組成在美國購買、認購或出售證券的建議或要約。本公告所述的證券並無亦不會根據1933年《美國證券法》（經修訂）（「證券法」）或美國任何州或其他司法權區的證券法登記。本公告所述證券會基於證券法S規例（「S規例」）在美國境外發售及出售，而未根據證券法辦理登記或獲得豁免登記的情況下不可在美國境內發售或出售。在受到限制或禁止的情況下，本公告所述證券並非亦不會在美國或任何其他司法權區公開發售。本公告或其所載資料並非索取金錢、證券或其他代價，而倘回應本公告或其所載資料而發出金錢、證券或其他代價亦不會獲接納。

致香港投資者通知：發行人（定義見下文）確認，債券（定義見下文）擬僅供專業投資者（定義見上市規則第三十七章）購買，並已按此基準在香港聯合交易所有限公司上市。因此，發行人確認，債券並不適合供香港的零售投資者作投資用途。投資者務請審慎考慮所涉及的風險。

–1–刊登發售通函

ZTE CORPORATION（中興通訊股份有限公司）（於中華人民共和國註冊成立的股份有限公司）（股份代號：00763）人民幣3584百萬元零息美元結算於2030年到期的

H股可轉換債券（債券股份代號：85046）

本公告乃中興通訊股份有限公司（「發行人」或「公司」）根據香港聯合交易所有限公司（「香港聯交所」）證券上市規則第37.39A條刊發。

茲提述發行人於2025年8月5日所刊發人民幣3584百萬元零息美元結算於2030年到

期的H股可轉換債券（「債券」）於香港聯交所上市的通告。

請參閱本公告隨附日期為2025年7月28日的發行通函（「發行通函」），內容有關債券。按發行通函所披露，債券僅供專業投資者（定義見上市規則第三十七章）購買，並已按此基準在香港聯交所上市。

發行通函並不構成在任何司法權區向公眾人士提呈發售任何證券的招股章程、通

告、通函、小冊子或廣告，亦非邀請公眾人士提出認購或購買任何證券的要約，且刊發目的並非邀請公眾人士提出認購或購買任何證券的要約。

發行通函不得被視為誘使認購或購買公司任何證券的行為，且公司無意進行任何此類誘使。

承董事會命方榕董事長深圳，中國二零二五年八月六日

–2–於本公告日期，本公司董事會包括執行董事：徐子陽；非執行董事：方榕、閆俊武、諸為民、張洪；獨立非執行董事：莊堅勝、王清剛、徐奇鵬；以及職工董事：

李妙娜。

– 3 –IMPORTANT NOTICE

NOT FOR DISTRIBUTION TO ANY PERSON OR ADDRESS IN THE UNITED STATES.IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the attached

offering circular (the “Offering Circular”). You are therefore advised to read this disclaimer carefully before reading accessing

or making any other use of the attached Offering Circular. In accessing the attached Offering Circular you agree to be bound

by the following terms and conditions including any modifications to them from time to time each time you receive any

information from the Issuer (as defined in the attached Offering Circular) or from CLSA Limited and China Securities

(International) Corporate Finance Company Limited (the “Lead Managers”) as a result of such access. In order to review the

attached Offering Circular or make an investment decision with respect to the securities you must be located outside the

United States.Confirmation of Your Representation: By accessing the attached Offering Circular you shall be deemed to have represented to

the Issuer and the Lead Managers that (1) you are not in the United States and to the extent you purchase the securities

described in the attached Offering Circular you will be doing so pursuant to Regulation S under the U.S. Securities Act of

1933 as amended (the “Securities Act”); (2) the e-mail address that you gave us and to which this e-mail has been delivered is

not located in the United States its territories or possessions; (3) you consent to the delivery of the attached Offering Circular

and any amendments or supplements thereto by electronic transmission; (4) you (and any nominee and any person on whose

behalf you are subscribing for the securities to which the attached Offering Circular relates) are not a “connected person” (as

defined in the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”))

of the Issuer which includes but is not limited to any director chief executive or substantial shareholder of the Issuer or any of

its subsidiaries or any associate of any of them within the meaning of the Listing Rules; and (5) you (and any nominee and any

person on whose behalf you are subscribing for the securities to which the attached Offering Circular relates) are and will

immediately after completion of the offering of such securities be independent of and not acting in concert with any of such

connected persons in relation to the control of the Issuer.The attached Offering Circular has been made available to you in electronic form. You are reminded that documents

transmitted via this medium may be altered or changed during the process of transmission and consequently none of the

Issuer the Lead Managers the Trustee (as defined in the attached Offering Circular) and the Agents (as defined in the

attached Offering Circular) or any of their respective directors officers employees representatives agents affiliates or

advisers or any person who controls any of them accepts any liability or responsibility whatsoever in respect of any

discrepancies between the document distributed to you in electronic format and the hard copy version. The Lead Managers

will provide a hard copy version to you upon request.Restrictions: The attached Offering Circular is being furnished in connection with an offering exempt from registration under

the Securities Act solely for the purpose of enabling a prospective investor to consider the purchase of the securities described

herein.THE SECURITIES DESCRIBED IN THE ATTACHED OFFERING CIRCULAR HAVE NOT BEEN AND WILL NOT BE

REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE OF THE U.S. OR

OTHER JURISDICTION AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES EXCEPT

PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION

REQUIREMENTS OF THE SECURITIES ACT AND ANY APPLICABLE STATE OR LOCAL SECURITIES LAWS.THIS OFFERING IS MADE SOLELY IN OFFSHORE TRANSACTIONS PURSUANT TO THE SECURITIES ACT.NOTHING IN THIS ELECTRONIC TRANSMISSION CONSTITUTES AN OFFER OF SECURITIES FOR SALE IN ANY

JURISDICTION WHERE IT IS UNLAWFUL TO DO SO.Except with respect to eligible investors in jurisdictions where such offer or invitation is permitted by law nothing in this

electronic transmission constitutes an offer or an invitation by or on behalf of the Issuer the Lead Managers the Trustee or

the Agents or any of their respective directors officers employees representatives agents affiliates or advisers or any person

who controls any of them to subscribe for or purchase any of the securities described therein and access has been limited so

that it shall not constitute a general advertisement or solicitation in the United States or elsewhere. If a jurisdiction requires

that the offering be made by a licensed broker or dealer and the underwriters or any affiliate of the underwriters is a licensed

broker or dealer in that jurisdiction the offering shall be deemed to be made by the Lead Managers and their respective

affiliates on behalf of the Issuer in such jurisdiction. You are reminded that you have accessed the attached Offering Circular

on the basis that you are a person into whose possession this Offering Circular may be lawfully delivered in accordance with

the laws of the jurisdiction in which you are located and you may not nor are you authorised to deliver this Offering Circular

electronically or otherwise to any other person. If you have gained access to this transmission contrary to the foregoing

restrictions you will be unable to purchase any of the securities described therein.Actions that You May Not Take: You should not reply by e-mail to this communication and you may not purchase any

securities by doing so. Any reply e-mail communications including those you generate by using the “Reply” function on your

e-mail software will be ignored or rejected.YOU ARE NOT AUTHORISED AND YOU MAY NOT FORWARD OR DELIVER THE ATTACHED OFFERING

CIRCULAR ELECTRONICALLY OR OTHERWISE TO ANY OTHER PERSON OR REPRODUCE SUCH OFFERING

CIRCULAR IN ANY MANNER WHATSOEVER. ANY FORWARDING DISTRIBUTION OR REPRODUCTION OF

THIS DOCUMENT AND THE ATTACHED OFFERING CIRCULAR IN WHOLE OR IN PART IS UNAUTHORISED.FAILURE TO COMPLY WITH THIS DIRECTIVE MAY RESULT IN A VIOLATION OF THE SECURITIES ACT OR

THE APPLICABLE LAWS OF OTHER JURISDICTIONS.You are responsible for protecting against viruses and other destructive items. If you receive this document by e-mail your use

of this e-mail is at your own risk and it is your responsibility to take precautions to ensure that it is free from viruses and other

items of a destructive nature.ZTE CORPORATION

(中興通訊股份有限公司)

(a joint stock limited company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 00763)

(as “Issuer”)

RMB3584 million U.S. Dollar Settled Zero Coupon Convertible Bonds due 2030

Issue Price: 100.0 per cent.The RMB3584 million U.S. dollar settled zero coupon convertible bonds due 2030 (the “Bonds” which term shall include unless the context requires otherwise any further bonds issued in accordance

with Condition 15 (Further Issues) of the terms and conditions of the Bonds set out in “Terms and Conditions of the Bonds” (the “Terms and Conditions”) and consolidated and forming a single series

therewith) will be issued by ZTE Corporation (中興通訊股份有限公司) (the “Issuer” the “Company” “ZTE” “we” or “us”). The issue price of the Bonds shall be 100.0 per cent. of the aggregate

principal amount of the Bonds. The specified denomination of each Bond shall be RMB2000000 each and integral multiples of RMB1000000 in excess thereof.The Bonds will upon issue constitute direct unsubordinated unconditional and (subject to Condition 3.1 (Negative Pledge) of the Terms and Conditions) unsecured obligations of the Issuer and shall

at all times rank pari passu and without any preference or priority among themselves. The payment obligations of the Issuer under the Bonds shall save for such exceptions as may be provided by

mandatory provisions of applicable law and subject to Condition 3.1 (Negative Pledge) of the Terms and Conditions at all times rank at least equally with all of its other present and future direct

unsubordinated unconditional and unsecured obligations.Each Bond will subject to the Terms and Conditions at the option of the holder be convertible (unless previously redeemed converted or purchased and canceled) at any time on or after the 41st day

after 5 August 2025 (the “Issue Date”) up to the close of business (at the place where the Certificate evidencing such Bond is deposited for conversion) on the date falling seven working days prior to the

Maturity Date (as defined herein) (both days inclusive) into fully paid ordinary H Shares (as defined in the Terms and Conditions) with a par value of RMB1.00 each of the Issuer at an initial conversion

price of HK$30.25 per H Share (as defined in the Terms and Conditions) with a fixed exchange rate of RMB0.9133 to HK$1.00 (the “Fixed Exchange Rate”). The conversion price is subject to

adjustment in the circumstances described under “Terms and Conditions of the Bonds — Conversion”.The Bonds are zero coupon and do not bear interest unless upon due presentation thereof payment of principal and premium (if any) is improperly withheld or refused.Unless previously redeemed converted or purchased and cancelled as provided in the Terms and Conditions the Issuer will redeem each Bond at the U.S. Dollar Equivalent (as defined in the Terms and

Conditions) of its outstanding principal amount on 5 August 2030 (the “Maturity Date”). On giving not less than 30 nor more than 60 days’ notice to the Bondholders (which notice will be irrevocable)

the Trustee and the Principal Agent the Issuer may redeem all but not some only of the Bonds at the U.S. Dollar Equivalent of their outstanding principal amount as at the date fixed for redemption if

at any time the aggregate principal amount of the Bonds outstanding is less than 10 per cent. of the aggregate principal amount originally issued (including any Bonds issued pursuant to Condition 15

(Further Issues) of the Terms and Conditions).

The Issuer may also at any time on giving not less than 30 nor more than 60 days’ notice to the Trustee the Principal Agent and the Bondholders (which notice shall be irrevocable) redeem all but not

some only of the Bonds at the U.S. Dollar Equivalent of their outstanding principal amount as at the date fixed for redemption in the event of certain changes or amendments relating to the People’s

Republic of China (the “PRC”) or Hong Kong taxation as further described in the Terms and Conditions.The holder of each Bond will have the right at such holder’s option to require the Issuer to redeem all or some only of such holder’s Bonds on the Relevant Event Put Date (as defined in the Terms and

Conditions) at the U.S. Dollar Equivalent of their outstanding principal amount as at the Relevant Event Put Date following the occurrence of a Relevant Event (as defined in the Terms andConditions). The holder of each Bond will also have the right at such holder’s option to require the Issuer to redeem all or some only of the Bonds of such holder on 5 August 2028 (the “Put OptionDate”) at the U.S. Dollar Equivalent of their outstanding principal amount on the Put Option Date. See “Terms and Conditions of the Bonds — Redemption Purchase and Cancellation”.For a detailed description of the Bonds see “Terms and Conditions of the Bonds”.The Issuer will undertake that it will (i) within 15 Registration Business Days (as defined in the Terms and Conditions) after the Issue Date register or cause to be registered with the StateAdministration of Foreign Exchange or its local branch (“SAFE”) the Bonds (the “Foreign Debt Registration”) pursuant to the Administrative Measures for Foreign Debt Registration《( 外債登記管理辦法》) and its operating guidelines effective as of 13 May 2013 as amended from time to time (the “Foreign Debt Registration Measures”) and if applicable the Circular of the People’s Bank of China onIssues Concerning the Overall Macro Prudential Management System for Cross-border Financing 《( 中國人民銀行關於全口徑跨境融資宏觀審慎管理有關事宜的通知》) (the “Cross-Border FinancingCircular”) (ii) use its best endeavours to complete the Foreign Debt Registration and obtain a registration record from SAFE on or before the Registration Deadline (being the day falling 90

Registration Business Days after the Issue Date) and (iii) comply with all applicable PRC laws and regulations in relation to the Bonds including but not limited to the Foreign Debt Registration

Measures the Cross-Border Financing Circular and any implementing measures promulgated thereunder from time to time.With reference to the Administrative Measures for the Review and Registration of Medium-and Long-Term Foreign Debts of Enterprises (企業中長期外債審核登記管理辦法（國家發展和改革委員會令

第56號）) (“Order 56”) issued by the PRC National Development and Reform Commission (the “NDRC”) and effective from 10 February 2023 and any implementation rules reports certificates

approvals or guidelines as issued by the NDRC from time to time the issuance of the Bonds has been registered with the NDRC and the NDRC has issued a certificate on 25 July 2025 evidencing such

registration which remains valid and in full force and effect. The Issuer will undertake that it will within the relevant prescribed timeframes after the Issue Date file or cause to be filed the requisite

information and documents in respect of the Bonds and comply with other reporting obligations in accordance with Order 56 and any implementation rules reports certificates approvals or guidelines

as issued by the NDRC from time to time including but not limited to the Initial NDRC Post-Issuance Filing (as defined below)).The Issuer will undertake to file or cause to be filed with the China Securities Regulatory Commission (the “CSRC”) within the relevant prescribed timeframes after the Issue Date the requisite

information and documents in respect of the Bonds in accordance with the CSRC Filing Rules (as defined in the Terms and Conditions) (the “CSRC Post-Issuance Filings” which term for the avoidance

of doubt includes the Initial CSRC Post-Issuance Filing (as defined below)) and comply with the continuing obligations under the CSRC Filing Rules and any implementation rules as issued by the

CSRC from time to time. The Issuer shall file or cause to be filed (a) the initial NDRC Post-Issuance Filing with the NDRC or its competent local counterpart of the information and documents relating

to the issue of the Bonds that are required to be filed in accordance with Order 56 within ten Registration Business Days after the Issue Date (the “Initial NDRC Post-Issuance Filing”) and (b) the CSRC

Filing Report (as defined in the Terms and Conditions) and other requisite information and documents in respect of the Bonds that are required to be filed with the CSRC within three Registration

Business Days after the Issue Date in accordance with the CSRC Filing Rules (the “Initial CSRC Post-Issuance Filing”).Application will be made to the Hong Kong Stock Exchange (as defined below) for the listing of the Bonds by way of debt issues to professional investors (as defined in Chapter 37 of the Rules

Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited) (the “Professional Investors”) only. This document is for distribution to professional investors only.Notice to Hong Kong investors: The Issuer confirms that the Bonds are intended for purchase by Professional Investors only and will be listed on the Hong Kong Stock Exchange on that basis. Accordingly

the Issuer confirms that the Bonds are not appropriate as an investment for retail investors in Hong Kong. Investors should carefully consider the risks involved.The Hong Kong Stock Exchange has not reviewed the contents of this document other than to ensure that the prescribed form disclaimer and responsibility statements and a statement limiting distribution of

this document to Professional Investors only have been reproduced in this document. Listing of the Bonds on the Hong Kong Stock Exchange is not to be taken as an indication of the commercial merits or

credit quality of the Bonds or the Issuer or the Group (as defined below) or quality of disclosure in this document. Hong Kong Exchanges and Clearing Limited and the Hong Kong Stock Exchange take no

responsibility for the contents of this document make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in

reliance upon the whole or any part of the contents of this document.Investors should be aware that there are risks relating to the exercise of Conversion Rights of the Bonds and there are various other risks relating to the Bonds the Issuer and its subsidiaries its

business and its jurisdiction of operations which investors should familiarise themselves with before making an investment in the Bonds. See “Risk Factors” beginning on page 19.The Bonds will initially be represented by a global certificate (the “Global Certificate”) in registered form which will be registered in the name of a nominee of and shall be deposited on the Issue Date

with a common depositary on behalf of Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking S.A. (“Clearstream”). Beneficial interests in the Global Certificate will be shown on and

transfer thereof will be effected only through records maintained by Euroclear and Clearstream. Except as described in the Global Certificate individual certificates for Bonds will not be issued in

exchange for interests in the Global Certificate.The Bonds and the H Shares to be issued upon conversion of the Bonds have not been and will not be registered under the United States Securities Act of 1933 as amended (the “Securities Act”) and may not

be offered or sold within the United States except pursuant to an exemption from or in a transaction not subject to the registration requirements of the Securities Act. For a description of these and certain

further restrictions on offers and sales of the Bonds and the H Shares to be issued upon conversion of the Bonds and the distribution of this Offering Circular see “Subscription and Sale”.The Bonds are not intended to be initially placed and may not be initially placed to “connected persons” of the Issuer as defined in the Listing Rules (“Connected Persons”). Each holder of the Bonds

(and the beneficial owners of the Bonds if applicable) will be deemed to have represented to the Issuer CITIC Securities and China Securities International (the “Lead Managers”) that it is not a

Connected Person of the Issuer and will not after completion of the subscription of the Bonds be a Connected Person (as defined in the Listing Rules) of the Issuer. Each prospective investor will be

deemed to have agreed with the Issuer and the Lead Managers that it may to the extent required by the Listing Rules and/or the Hong Kong Stock Exchange and/or the Hong Kong Securities and

Futures Commission (the “SFC”) disclose information about such potential investor (including but not limited to its name company registration number and the number of Bonds allotted to it) to

certain parties.The appointment of China Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公司) as Trustee Principal Paying Agent Registrar Transfer Agent and Conversion Agent in

respect of the Bonds is subject to completion of satisfactory know your client procedures by China Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公司).Joint Global Coordinators Joint Lead Managers and Joint Bookrunners

CITIC Securities China Securities International

The date of this Offering Circular is 28 July 2025.CONTENTS

Page

IMPORTANT NOTICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . viii

PRESENTATION AND INCORPORATION OF

FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . x

CERTAIN DEFINITIONS CONVENTIONS AND

CURRENCY PRESENTATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi

DEFINITIONS AND GLOSSARY OF TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii

SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

RECENT DEVELOPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

SUMMARY FINANCIAL INFORMATION AND OTHER DATA . . . . . . . . . . . . . 6

THE OFFERING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

CAPITALISATION AND INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

DIVIDENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

DESCRIPTION OF THE GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

DIRECTORS AND SENIOR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74

SUBSTANTIAL SHAREHOLDERS’ AND DIRECTORS’ INTERESTS . . . . . . . 79

DESCRIPTION OF THE SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

TERMS AND CONDITIONS OF THE BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

SUMMARY OF PROVISIONS RELATING TO THE BONDS IN

GLOBAL FORM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137

MARKET PRICE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140

EXCHANGE RATE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141

TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 143

SUBSCRIPTION AND SALE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147

DESCRIPTION OF CERTAIN DIFFERENCES BETWEEN PRC

GAAP AND IFRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154

GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156

iIMPORTANT NOTICE

This Offering Circular includes particulars given in compliance with the Listing Rules for

the purpose of giving information with regard to the Issuer and the Group. The Issuer

accepts full responsibility for the accuracy of the information contained in this Offering

Circular and confirms having made all reasonable enquiries that to the best of its

knowledge and belief there are no other facts the omission of which would make any

statement herein misleading.The Issuer having made all reasonable enquiries confirms that (i) this Offering Circular

contains all information (including financial business conditions and prospects

information) with respect to the Issuer the Group the Shares and the Bonds which is

material in the context of the issue and offering of the Bonds (the “Offering”) (including the

information which is required by applicable laws and regulations according to the

particular nature of the Issuer and its subsidiaries taken as a whole (the “Group”) the

Shares and the Bonds is necessary to enable investors and their investment advisers to

make an informed assessment of the assets and liabilities financial position profits and

losses and prospects of the Issuer and the Group and of the rights attaching to the Shares

and the Bonds) (ii) the statements contained in this Offering Circular relating to the Issuer

and the Group are in any material respect true and accurate and not misleading (iii) the

opinions and intentions expressed in this Offering Circular with regard to the Issuer and the

Group are honestly held have been reached after considering all relevant circumstances and

are based on reasonable assumptions (iv) all reasonable enquiries have been made by the

Issuer to ascertain such facts in relation to the Issuer the Group the Bonds and the Shares

and to verify the accuracy in all material respects of all such information and statements in

relation to the Issuer the Group the Bonds and the Shares as contained in this Offering

Circular and (v) this Offering Circular does not include an untrue statement of a material

fact or omit to state a material fact or other facts in relation to the Issuer the Group the

Shares or the Bonds necessary in order to make the statements therein in the light of the

circumstances under which they were made or in the context of the issue and the offering of

the Bonds not misleading. The Issuer accepts full responsibility for the information

contained in this Offering Circular.This Offering Circular has been prepared by the Issuer solely for use in connection with the

proposed offering of the Bonds described in this Offering Circular and may not be

reproduced redistributed or made available in whole or in part to any other person for any

purpose. This Offering Circular does not constitute an offer of or an invitation by or on

behalf of CLSA Limited and China Securities (International) Corporate Finance Company

Limited (the “Lead Managers”) or the Issuer to subscribe for or purchase any of the Bonds.The distribution of this Offering Circular and the offering of the Bonds in certain

jurisdictions may be restricted by law. Persons into whose possession this Offering Circular

comes are required by the Issuer or the Lead Managers to inform themselves about and to

observe any such restrictions. No action is being taken to permit a public offering of the

Bonds or the distribution of this Offering Circular in any jurisdiction where action would be

required for such purposes. There are restrictions on the offer and sale of the Bonds and

the circulation of documents relating thereto in certain jurisdictions including the United

States the United Kingdom the European Economic Area (the “EEA”) the PRC Hong

Kong Singapore and Japan and to persons connected therewith. For a description of

certain further restrictions on offers sales and resales of the Bonds and distribution of this

Offering Circular see “Subscription and Sale”. By purchasing the Bonds investors are

deemed to have represented and agreed to all of those provisions contained in that section

iiof this Offering Circular. This Offering Circular is personal to each offeree and does not

constitute an offer to any other person or to the public generally to subscribe for or

otherwise acquire the Bonds. Distribution of this Offering Circular to any person other

than the prospective investor and any person retained to advise such prospective investor

with respect to its purchase is unauthorised. Each prospective investor by accepting

delivery of this Offering Circular is deemed to have agreed to the foregoing and to make no

photocopies of this Offering Circular or any documents referred to in this Offering Circular.Each prospective investor acknowledges that it is purchasing the Bonds for its own account

and not with a view to distribution thereof and it is or at the time of its purchase will be the

beneficial owner of the Bonds purchased and (i) outside the United States; and (ii) not an

affiliate of the Issuer or a person acting on behalf of such an affiliate. Each prospective

investor acknowledges that its purchase of the Bonds is lawful under the securities laws of the

jurisdiction in which such prospective investor accepts the offer to purchase the Bonds.The completion of the Offering is subject to the satisfaction and/or waiver of customary

conditions precedent and the Lead Managers may exercise its discretion to terminate the

transaction for reasons set forth in the Subscription Agreement (as defined below). Each

person receiving this Offering Circular represents and acknowledges that the Lead

Managers will not be held liable for any damages as a result of non-completion of the

Offering or for the exercise of such rights or discretion.No person has been or is authorised to give any information or to make any representation

concerning the Issuer the Group or the Bonds other than as contained herein and if given

or made any such other information or representation should not be relied upon as having

been authorised by the Issuer the Lead Managers China Construction Bank (Asia)

Corporation Limited (中國建設銀行（亞洲）股份有限公司) as the trustee (the “Trustee”) or

the Agents (as defined in the Terms and Conditions) or any of their respective directors

officers employees agents representatives affiliates or advisers or any person who

controls any of them. Neither the delivery of this Offering Circular nor any offering sale or

delivery made in connection with the issue of the Bonds shall under any circumstances

constitute a representation that there has been no change or development reasonably likely

to involve a change in the affairs of the Issuer the Group or any of them since the date

hereof or create any implication that the information contained herein is correct as of any

date subsequent to the date hereof. This Offering Circular does not constitute an offer of or

an invitation by or on behalf of the Issuer the Lead Managers the Trustee or the Agents or

any of their respective directors officers employees agents representatives affiliates or

advisers or any person who controls any of them to subscribe for or purchase any of the

Bonds and may not be used for the purpose of an offer to or a solicitation by anyone in

any jurisdiction or in any circumstances in which such offer or solicitation is not authorised

or is unlawful.This Offering Circular is being furnished by the Issuer in connection with the offering of the

Bonds and is exempt from registration under the Securities Act solely for the purpose of

enabling a prospective investor to consider purchasing the Bonds. Investors must not use

this Offering Circular for any other purpose make copies of any part of this Offering

Circular or give a copy of it to any other person or disclose any information in this

Offering Circular to any other person. The information contained in this Offering Circular

has been provided by the Issuer and other sources identified in this Offering Circular. Any

reproduction or distribution of this Offering Circular in whole or in part and any

disclosure of its contents or use of any information herein for any purpose other than the

iiiconsideration of an investment in the Bonds offered by this Offering Circular is prohibited.By accepting delivery of this Offering Circular each investor is deemed to have agreed to

these restrictions.None of the Lead Managers the Trustee or the Agents or any of their respective directors

officers employees agents representatives affiliates or advisers or any person who

controls any of them has separately verified the information contained in this Offering

Circular and none of them can give any assurance that such information is accurate

truthful or complete. Accordingly no representation warranty or undertaking express or

implied is made and no responsibility or liability is accepted by the Lead Managers the

Trustee or the Agents or any of their respective directors officers employees agents

representatives affiliates or advisers or any person who controls any of them as to the

accuracy completeness or sufficiency of the information contained in this Offering Circular

or of any such information or for any other statement made or purported to be made by the

Lead Managers the Trustee or the Agents or any of their respective directors officers

employees agents representatives affiliates or advisers or any person who controls any of

them or on their behalf in connection with the Issuer the Group or the issue and offering of

the Bonds or the Shares. Nothing contained in this Offering Circular is or shall be relied

upon as a promise recommendation representation or warranty express or implied by the

Lead Managers the Trustee the Agents or any of their respective directors officers

employees agents representatives affiliates or advisers or any person who controls any of

them. This Offering Circular is not intended to provide the basis of any credit or other

evaluation nor should it be considered as a recommendation by the Issuer the Lead

Managers the Trustee the Agents or any of their respective directors officers employees

agents representatives affiliates or advisers or any person who controls any of them that

any recipient of this Offering Circular should purchase the Bonds.Each prospective investor agrees not to hold the Lead Managers the Trustee or the Agents

or any of their respective directors officers employees agents representatives affiliates or

advisers or any person who controls any of them responsible for any misstatements in or

omissions from this Offering Circular. Each person receiving this Offering Circular

acknowledges that such person has not relied on any investigation or due diligence

conducted by the Lead Managers the Trustee or the Agents or any of their respective

directors officers employees agents representatives affiliates or advisers or any person

who controls any of them in connection with its investigation of the accuracy of such

information or its investment decision and each such person must rely on its own

examination of the Issuer and the Group and the merits and risks involved in investing in

the Bonds.In making an investment decision investors must rely on their own examination of the

Issuer the Group and the terms of the offering of the Bonds including the merits and risks

involved. Each prospective investor acknowledges that it has such knowledge and

experience in financial business and international investment matters such that it is

capable of evaluating the merits and risks of investing in the Bonds and understands that

entering into the Offering involves a high degree of risk and that the Bonds are a speculative

investment. See “Risk Factors” for a discussion of certain factors to be considered in

connection with an investment in the Bonds. Each prospective investor acknowledges that

the Shares are listed on the Hong Kong Stock Exchange and the Issuer is therefore required

to publish certain business and financial information in accordance with the rules and

practices of the Hong Kong Stock Exchange which includes among other things

descriptions of the Group’s principal activities and the balance sheets income statements

ivand cash flow statements and other information relating to the Group which is necessary to

enable holders of the Shares and the public to appraise the position of the Issuer the

Guarantor and the Group and each prospective investor is able to obtain or access such

information without undue difficulty. Nothing herein shall be construed as a

recommendation to each such person to purchase the Bonds. To the fullest extent

permitted by law none of the Lead Managers the Trustee or the Agents or any of their

respective directors officers employees agents representatives affiliates or advisers or any

person who controls any of them accepts any responsibility for the contents of this Offering

Circular.Each of the Lead Managers the Trustee and the Agents and each of their respective

directors officers employees agents representatives affiliates and advisers and each

person who controls any of them accordingly disclaims all and any liability whether arising

in tort or contract or otherwise which it might otherwise have in respect of this Offering

Circular or any such statement. None of the Lead Managers the Trustee or the Agents or

any of their respective directors officers employees agents representatives affiliates or

advisers or any person who controls any of them undertakes to review the Issuer’s or the

Group’s business financial condition results of operations prospects or affairs after the

date of this Offering Circular nor to advise any investor or potential investor in the Bonds

of any information coming to the attention of any of the Lead Managers the Trustee or the

Agents or any of their respective directors officers employees agents representatives

affiliates or advisers or any person who controls any of them.The Trustee shall not be responsible or have any liability for the recitals statements

warranties or representations of any other party contained in the Trust Deed (as defined in

the Terms and Conditions) the Agency Agreement (as defined in the Terms and

Conditions) or any other document entered into in connection with the Bonds and the

Trustee shall be entitled to assume the accuracy and correctness thereof for the execution

legality effectiveness adequacy genuineness validity enforceability or admissibility in

evidence in the Trust Deed the Agency Agreement or any such other agreement or

document referred to above.In connection with the offering of the Bonds the Lead Managers and/or their respective

affiliates or affiliates of the Issuer may act as investors and place orders receive

allocations and trade the Bonds for their own account and such orders allocations or

trading of the Bonds may be material. These entities may hold or sell such Bonds or

purchase further Bonds for their own account in the secondary market or deal in any other

securities of the Issuer and therefore they may offer or sell the Bonds or other securities

otherwise than in connection with the offering of the Bonds. Accordingly references herein

to the offering of the Bonds should be read as including any offering of the Bonds to the

Lead Managers and/or their respective affiliates or affiliates of the Issuer as investors for

their own account. Such entities are not expected to disclose such transactions or the extent

of any such investment otherwise than in accordance with any applicable legal or

regulatory requirements. If such transactions occur the trading price and liquidity of the

Bonds may be impacted.Hong Kong Exchanges and Clearing Limited and the Hong Kong Stock Exchange take no

responsibility for the contents of this Offering Circular make no representation as to its

accuracy or completeness and expressly disclaim any liability whatsoever for any loss

howsoever arising from or in reliance upon the whole or any part of the contents of this

Offering Circular.vNotice to capital market intermediaries and prospective investors pursuant to paragraph 21 of

the Hong Kong SFC Code of Conduct — Important Notice to Prospective Investors:

Prospective investors should be aware that certain intermediaries in the context of this

offering of the Bonds including the Lead Managers are “capital market intermediaries”

(the “CMIs”) subject to Paragraph 21 of the Code of Conduct for Persons Licensed by or

Registered with the Securities and Futures Commission (the “SFC Code”). This notice to

prospective investors is a summary of certain obligations the SFC Code imposes on such

CMIs which require the attention and cooperation of prospective investors.Certain CMIs may also be acting as “overall coordinators” (together the “OCs”) for this

offering and are subject to additional requirements under the SFC Code.Prospective investors who are the directors employees or major shareholders of the Issuer

a CMI or its group companies would be considered under the SFC Code as having an

association (an “Association”) with the Issuer any CMI or the relevant group company.Prospective investors associated with the Issuer or the CMI (including its group companies)

should specifically disclose this when placing an order for the Bonds and should disclose at

the same time if such orders may negatively impact the price discovery process in relation

to this offering. Prospective investors who do not disclose their Associations are hereby

deemed not to be so associated. Where prospective investors disclose their Associations but

do not disclose that such order may negatively impact the price discovery process in relation

to this offering such order is hereby deemed not to negatively impact the price discovery

process in relation to this offering.Prospective investors should ensure and by placing an order prospective investors are

deemed to confirm that orders placed are bona fide are not inflated and do not constitute

duplicated orders (i.e. two or more corresponding or identical orders placed via two or more

CMIs). If a prospective investor is an asset management arm affiliated with any Lead

Manager such prospective investor should indicate when placing an order if it is for a fund

or portfolio where the Lead Manager or its group company has more than 50 per cent.interest in which case it will be classified as a “proprietary order” and subject to

appropriate handling by CMIs in accordance with the SFC Code and should disclose at the

same time if such “proprietary order” may negatively impact the price discovery process in

relation to this offering. Prospective investors who do not indicate this information when

placing an order are hereby deemed to confirm that their order is not a “proprietary order”.If a prospective investor is otherwise affiliated with any Lead Manager such that its order

may be considered to be a “proprietary order” (pursuant to the SFC Code) such

prospective investor should indicate to the Lead Manager when placing such order.Prospective investors who do not indicate this information when placing an order are

hereby deemed to confirm that their order is not a “proprietary order”. Where prospective

investors disclose such information but do not disclose that such “proprietary order” maynegatively impact the price discovery process in relation to this offering such “proprietaryorder” is hereby deemed not to negatively impact the price discovery process in relation to

this offering.Prospective investors should be aware that certain information may be disclosed by the

CMIs (including private banks) which is personal and/or confidential in nature to the

prospective investor. By placing an order prospective investors are deemed to have

understood and consented to the collection disclosure use and transfer of such information

by the Lead Managers and/or any other third parties as may be required by the SFC Code

including to the Issuer any OC relevant regulators and/or any other third parties as may be

virequired by the SFC Code it being understood and agreed that such information shall only

be used for the purpose of complying with the SFC Code during the bookbuilding process

for this offering. Failure to provide such information may result in that order being

rejected.viiFORWARD-LOOKING STATEMENTS

This Offering Circular includes “forward-looking statements”. All statements other than

statements of historical fact contained in this Offering Circular including without

limitation those regarding the Issuer’s and the Group’s future financial position and results

of operations strategy plans objectives goals and targets future developments in the

markets where the Issuer or the Group participates or is seeking to participate and any

statements preceded by followed by or that include the words “believe” “expect” “aim”

“intend” “will” “may” “anticipate” “seek” “should” “estimate” or similar expressions

or the negatives thereof are forward-looking statements. These forward-looking statements

involve known and unknown risks uncertainties and other factors some of which are

beyond the Issuer’s or the Group’s control which may cause its actual results performance

or achievements or industry results to be materially different from any future results

performance or achievements expressed or implied by the forward-looking statements.These forward-looking statements are based on numerous assumptions regarding the

Issuer’s and the Group’s present and future business strategies and the environment in

which the Issuer or the Group will operate in the future. Important factors that could cause

the Issuer’s or the Group’s actual results performance or achievements to differ materially

from those in the forward-looking statements include regional national or global political

economic business competitive market and regulatory conditions and the following:. the Group’s operations and business prospects;. business strategies and plans to achieve these strategies;. future developments trends and conditions in and competitive environment for the

industries and markets in which the Group operates;. general economic political and business conditions in locations where the Group

operates;. the Group’s financial condition performance and results of operations;. the Group’s capital expenditure plans;. various business opportunities that the Group may pursue;. availability of and changes to bank loans and other forms of financing;. the Group’s ability to expand and manage its growth both within the PRC and

abroad;. the Group’s dividend policy;. changes to the regulatory environment politics operating conditions of and general

outlook in the industries and markets in which the Group operates;. possible disruptions to commercial activities due to natural and human-induced

disasters including but not limited to floods earthquakes epidemics terrorist

attacks and armed conflicts;

viii. the Group’s expectation with respect to the ability to acquire and maintain regulatory

licenses or permits;. the amount and nature of and potential for future development of the Group’s

business;. the actions of and developments affecting competitors of the Group;. the actions of and development affecting the major customers and suppliers of the

Group;. certain statement in this Offering Circular with respect to overall market trends;. changes in currency exchange control and rates; and. other factors beyond the Group’s control.Additional factors that could cause actual results performance or achievements to differ

materially include but are not limited to those discussed in “Risk Factors” and elsewhere in

this Offering Circular. The Issuer cautions investors not to place undue reliance on these

forward-looking statements which reflect its managements’ view only as at the date on

which it is made. None of the Issuer the Lead Managers the Trustee or the Agents or any

of their respective directors officers employees agents representatives affiliates or

advisers or any person who controls any of them undertake any obligation to update or

revise any forward-looking statements whether as a result of new information future

events or otherwise. In light of these risks uncertainties and assumptions the

forward-looking events discussed in this Offering Circular might not occur.ixPRESENTATION AND INCORPORATION OF FINANCIAL INFORMATION

The Group’s consolidated statement of comprehensive income and consolidated statement

of financial position data for the years ended and as of 31 December 2022 2023 and 2024

have been extracted from the consolidated financial statements of the Group for the years

ended 31 December 2023 and 2024 (the “Audited Financial Statements”) contained in the

Issuer’s 2023 annual report (“2023 Annual Report”) and the Issuer’s 2024 annual report

(“2024 Annual Report”) respectively which have been audited by Ernst & Young Hua Ming

LLP and incorporated by reference in this Offering Circular. Such consolidated financial

statements are prepared in accordance with the PRC Accounting Standards for Business

Enterprise in the PRC (“PRC GAAP”).The Audited Financial Statements (including the related audit reports and the notes

thereto) which are contained in pages 123 to 271 of the 2023 Annual Report and pages 127

to 271 of the 2024 Annual Report are incorporated by reference in this Offering Circular.Copies of the 2023 Annual Report and the 2024 Annual Report are available and may be

downloaded free of charge from the website of the Hong Kong Stock Exchange at

www.hkex.com.hk.PRC GAAP differs in certain respects from International Financial Reporting Standards

(“IFRS”). The Issuer has not prepared any reconciliation of such consolidated financial

information between PRC GAAP and IFRS. For a discussion of certain differences betweenPRC GAAP and IFRS see “Summary of Certain Differences Between PRC GAAP andIFRS”.xCERTAIN DEFINITIONS CONVENTIONS AND CURRENCY PRESENTATION

This Offering Circular is prepared using a number of conventions which investors should

consider when reading the information contained herein. The terms the “Issuer” the

“Company” the “Group” “ZTE” and words of similar import refer to ZTE Corporation (中

興通訊股份有限公司) itself or to ZTE Corporation (中興通訊股份有限公司) and its

consolidated subsidiaries as the context requires.Market data and certain information and statistics included in this Offering Circular have

been obtained from both public and private sources including market research publicly

available information and industry publications. Although the Issuer believes the

information to be reliable it has not been independently verified by the Issuer the Lead

Managers the Trustee or the Agents or any of their respective directors officers

employees agents representatives affiliates or advisers or any person who controls any of

them and none of the Issuer the Lead Managers the Trustee or the Agents or any of their

respective directors officers employees agents representatives affiliates or advisers or any

person who controls any of them makes any representation as to the accuracy or

completeness of such information. In addition third party information providers may have

obtained information from market participants and such information may not have been

independently verified. In making an investment decision each investor must rely on its

own examination of the Issuer the Group and the terms of this offering and the Bonds

including the merits and risks involved. Where information has been sourced from a third

party the Issuer confirms that this information has been accurately reproduced and that as

far as the Issuer is aware and are able to ascertain from information published by third

parties no facts have been omitted which would render the reproduced information to be

inaccurate or misleading.In this Offering Circular all references to “USD” “US$” “U.S.$” and “U.S. dollars” are to

United States dollars the official currency of the United States; all references to “HK$”

“H.K. dollars” “Hong Kong dollars” and “HKD” are to Hong Kong dollars the official

currency of the Hong Kong Special Administrative Region of the People’s Republic of

China (“Hong Kong” or “HK”); all references to “RMB” or “Renminbi” are to the

Renminbi the official currency of the People’s Republic of China.References to the “PRC” “China” “Mainland of China” and “Mainland China” are to the

People’s Republic of China and for the purposes of this Offering Circular except where the

context requires do not include Hong Kong the Macau Special Administrative Region of

the People’s Republic of China (“Macau”) or Taiwan. The “PRC government” or the

“State” means the central government of the PRC including all political subdivisions

(including provincial municipal and other regional or local governmental entities) and

instrumentalities thereof or where the context requires any of them.Solely for your convenience this Offering Circular contains translations of certain

Renminbi amounts into U.S. dollar amounts at specified rates. Unless indicated

otherwise the translation of Renminbi amounts into U.S. dollar amounts has been made

at the rate of RMB7.2993 to US$1.00 the noon buying rate in New York City for cable

transfers payable in Renminbi as certified for customs purposes by the Federal Reserve

Bank of New York on 31 December 2024. All such translations in this Offering Circular are

provided solely for investors’ convenience and no representation is made that the RMB

xiamounts referred to herein have been could have been or could be converted into U.S.dollars or vice versa at any particular rate or at all. For further information relating to theexchange rates see “Exchange Rates“.In this Offering Circular where information has been presented in thousands or millions of

units amounts may have been rounded up or down. Accordingly totals of columns or rows

of numbers in tables may not be equal to the apparent total of the individual items and

actual numbers may differ from those contained herein due to rounding.The English names of the PRC nationals entities departments facilities laws regulations

certificates titles and the like are translations of their Chinese names and are included for

identification purposes only. In the event of any inconsistency the Chinese names shall

prevail.xiiDEFINITIONS AND GLOSSARY OF TERMS

In this Offering Circular unless the context otherwise requires the following expressions

shall have the following meanings:

“A Share(s)” . . . . . . . . . . ordinary domestic shares of RMB1.00 each issued by the

Issuer which are traded in Renminbi on the Shenzhen Stock

Exchange

“AAU” . . . . . . . . . . . . . . active antenna unit

“AI” . . . . . . . . . . . . . . . . artificial intelligence

“Articles of Association” or the articles of association of the Issuer

“Articles” . . . . . . . . . . .“Board of Directors” or board of directors of the Issuer

“Board” . . . . . . . . . . . .“Bondholder” or “Holder” . a holder of the Bonds

“CSRC” . . . . . . . . . . . . . China Securities Regulatory Commission of the PRC (中國

證券監督管理委員會)

“Director(s)” . . . . . . . . . . the director(s) of the Issuer

“Gbps” . . . . . . . . . . . . . . gigabits per second

“Group”. . . . . . . . . . . . . . the Issuer and its subsidiaries

“H Share(s)” . . . . . . . . . . ordinary foreign shares with a par value of RMB1.00 each

issued by the Issuer which are traded in HK dollars on the

Hong Kong Stock Exchange“Hong Kong Stock The Stock Exchange of Hong Kong Limited aExchange” . . . . . . . . . . . wholly-owned subsidiary of Hong Kong Exchanges and

Clearing Limited

“ICT” . . . . . . . . . . . . . . . information and communications technology

“IT” . . . . . . . . . . . . . . . . information technology

“Shares” . . . . . . . . . . . . . the H Shares the A Shares and any fully-paid and

non-assessable shares of any class or classes of the

ordinary shares of the Issuer authorised after the date of

the issue of the Bonds which have no preference in respect of

dividends or of amounts payable in the event of any

voluntary or involuntary liquidation or dissolution of the

Issuer

“PBOC” . . . . . . . . . . . . . the People’s Bank of China (中國人民銀行) the central bank

of the PRC

xiii“R&D” . . . . . . . . . . . . . . research and development

“SAFE” . . . . . . . . . . . . . . the State Administration of Foreign Exchange of the PRC

(中國國家外匯管理局) or its local branch

“Shenzhen Stock Exchange” the Shenzhen Stock Exchange (深圳證券交易所)

xivSUMMARY

This summary may not contain all of the information that may be important to you. You

should read this entire Offering Circular before making an investment decision to purchase the

Bonds.OVERVIEW

The Issuer was incorporated on 11 November 1997 as a joint stock limited liability company

in Guangdong Province the PRC. The Issuer’s A shares were listed on the main board of

the Shenzhen Stock Exchange following an initial public offering in November 1997 stock

code 000063.SZ. It became the first A share company to be listed on the Main Board of the

Hong Kong Stock Exchange following an initial public offering of H shares in December

2004 stock code 00763.HK. The controlling shareholder of the Group is Zhongxingxin

Telecom Company Limited a company which was incorporated in the PRC on 29 April

1993 and has a registered capital of RMB100 million. The Issuer is independent of its

controlling shareholder in respect of assets staffing finance organisation and business.The Issuer and its controlling shareholder are audited independently and each assumes its

own responsibilities and risks.The Group is a world-leading provider of integrated telecommunications and IT solutions

with a full range of end-to-end ICT products and solutions integrating design

development production sales and services with a special focus on carriers’ networks

consumer business and government and corporate business. As a global leading provider of

integrated ICT solutions the Group is organised into business units based on its products

and services and has three core operating segments as follows:. Carrier’s Network. The carriers’ network business focuses on meeting carriers’

requirements in network evolution with the provision of wireless access wireline

access bearer systems core networks service and storage and other innovative

technologies and production solutions;. Consumer Business. The consumer business focuses on bringing experience in smart

devices to customers while also catering to the requirements of industry clients through

the development production and sale of products such as home information terminal

smart phones mobile Internet terminals innovative fusion terminals as well as the

provision of related software application and value-added services;. Government and Corporate Business. The government and corporate business focuses

on meeting requirements of government and corporate clients providing

informatisation solutions for the government and corporations through the

application of products such as communications networks IOT Big Data and cloud

computing.Technological leadership is the cornerstone of the Group’s development. As at 31 December

2024 the Group has a headcount of over 33000 R&D personnel representing over 48.5%

of its total workforce. The Group is a major contributor of global patents and participant in

the research and standard formulation for global 5G technology. As at 31 December 2024

the Group had submitted approximately 93000 global patent applications and owned

approximately 48000 authorised global patents including approximately 5500 patent

applications and over 2000 authorised patents in the chip sector. In the AI sector the

– 1 –Group had over 5000 patent applications and close to half of them had been authorised.The Group has received 11 gold awards 3 silver awards and 39 awards of excellence in the

patent awards of China. The Group is a member of more than 200 international

standardisation organisations industry alliances scientific associations and open-source

communities such as ITU (International Telecommunication Union) 3GPP (third

generation partnership programme) ETSI (European Telecommunications Standards

Institute) NGMN (The Next Generation Mobile Networks) IEEE (Institute of Electrical

and Electronics Engineers) CCSA (The China Communications Standards Association)

5GAIA (5G Applications Industry Array) and AII (Alliance of Industrial Internet) and a

board member of numerous organisations such as GSA (Global Suppliers’ Alliance) and

ETSI (The European Telecommunications Standards Institute).With innovative technologies and product solutions the Group serves global telecom

operators consumers and government and enterprise customers. Covering more than 160

countries and regions the Group serves over one-fourth of people worldwide and is

committed to achieving a future of global connectivity and trust. The Group strives to

create an intelligent future with digital innovation an excellent growth platform for

employees and greater value for customers shareholders and stakeholders across the globe.The Group intends to persist in its innovation-driven approach and maintain its strategic

focus to speed up transition from connectivity to computility while controlling operational

risks to maintain stable operations.As at 31 December 2024 the total share capital of the Issuer was 4783534887 shares

(including 4028032353 A shares and 755502534 H shares) all of which have already been

paid up. As at 31 December 2022 2023 and 2024 the Group’s total assets amounted to

RMB180953.6 million RMB200958.3 million and RMB207323.2 million. For the years

ended 31 December 2022 2023 and 2024 the Group recorded operating revenue of

RMB122954.4 million RMB124250.9 million and RMB121298.8 million respectively.For the same periods the Group recorded net profit attributable to holders of ordinary

shares of the listed company of RMB8080.3 million RMB9325.8 million and RMB8424.8

million respectively.COMPETITIVE STRENGTHS

We believe the following strengths contribute to our success and differentiate us from our

competitors:. Commitment to long-term investment and mastery of foundational technologies.. A leading position in the ICT industry in China.. Strong global market expansion and service capabilities.BUSINESS STRATEGIES

The Group positions itself as a “path-builder for digital economy” focusing on the pathway

of “connectivity + computility”. In the presence of new challenges as well as opportunitiesthe Group will operate its business on the principle of “seeking advancement while ensuringstability and pursuing innovation while assuring the principal business” and strengthen its

resilience expediting development of the secondary-curve business represented by products

– 2 –and solutions such as server and storage and data centre switch and computing and handset

on top of stable advancement of the primary-curve business represented by wireless and

wireline products in order to chart new frontiers.– 3 –RECENT DEVELOPMENTS

ELECTION OF THE EMPLOYEE DIRECTOR OF THE BOARD

On 23 May 2025 the Group announced that Ms. Li Miaona was elected as the employee

director of the Board at the sixth meeting of the ninth session employee representative

congress of the Issuer. Ms. Li’s term of office commenced on 23 May 2025 and will expire

upon the conclusion of the term of the tenth session of the Board on 27 March 2028. Ms. Li

has been supervisor of the Issuer from March 2022 to April 2025. She has extensivemanagement and operational experience. Please refer to the section headed “Directors andSenior Management — Directors” for her biography.ABOLISHMENT OF THE SUPERVISORY COMMITTEE

At the First Extraordinary General Meeting of 2025 of the Issuer held on 24 April 2025 (the

“EGM”) the shareholders of the Issuer approved amendments to the Articles of

Association the Rules of Procedure for General Meetings of Shareholders of the Issuer

and the Rules of Procedure for Board of Directors Meetings Issuer in order to comply with

the regulatory requirements for listed companies in the PRC and to further improve the

Issuer’s corporate governance. The said amendments were made in accordance with the

provisions of the Company Law of PRC and the Guidelines for the Articles of Association

of Listed Companies (Revised in 2025) issued by the CSRC on 28 March 2025. Pursuant to

the amendments to the Articles of Association the term of Supervisory Committee of the

Issuer shall expire and the Supervisory Committee of the Issuer shall be abolished. After the

EGM all the functions and powers of the Supervisory Committee of Issuer shall be

exercised by the Audit Committee of the Board.PROVISION OF GUARANTEE FOR A SUBSIDIARY

On 24 April 2025 the Group announced that it resolved to provide a total guarantee

amount of no more than US$1.5 billion for the payment obligations of its subsidiary ZTE

KANGXUN TELECOM CO. LTD. in the procurement business commencing on the date

on which the letter of guarantee comes into effect and ending when the subsidiary

terminates the procurement from suppliers and no debt payment is due and outstanding.FINANCIAL INFORMATION FOR THE THREE MONTHS ENDED 31 MARCH 2025

For the three months ended 31 March 2025 the Group recorded a decrease in net cash flows

from operating activities when compared to the corresponding period in 2024 primarily due

to an increase in cash paid for the purchase of goods and labour services. In addition the

Group recorded an increase in investment income primarily due to an increase in gain from

structured deposits and decrease in loss from associates and joint ventures and an increase

in credit impairment losses primarily due to increase in receivable impairment provisions.As at 31 March 2025 as compared to their respective balances as at 31 December 2024 the

Group recorded (i) an increase in total assets primarily due to an increase in prepayment

for purchases from third parties unexpired bill discounting for the period and purchase of

fixed-income certificates and prepaid VAT and credit tax available for set-off and (ii) an

increase in total liabilities primarily due to an increase in long term borrowings dividends

payable and medium-term notes issued for the period.– 4 –The financial information of the Group as at and for the three months ended 31 March 2025

is prepared in accordance with PRC GAAP and has not been subject to an audit or review

by the Group’s independent auditors and should not be relied upon by investors to provide

the same quality of information associated with audited or reviewed financial information.Potential investors must exercise caution when using such data to evaluate the Group’s

financial condition and results of operations. Such financial information as at and for the

three months ended 31 March 2025 should not be taken as an indication of the Group’s

expected financial condition or results of operations as at and for the full financial year

ended 31 December 2025.ELECTION OF CHAIR OF THE BOARD

At the first meeting of the tenth session of the Board held on 31 March 2025 Ms. Fang

Rong was elected as chair of the Board. Ms. Fang Rong has been a Non-executive Director

of the Issuer since June 2018. She has many years of operational and management in thetelecommunication industry. Please refer to the section headed “Directors and SeniorManagement — Directors” for her biography.USE OF DERIVATIVE FINANCIAL INSTRUMENTS AND WEALTH MANAGEMENT

PRODUCTS

On 28 February 2025 the Issuer announced on the Hong Kong Stock Exchange that the

Group proposed to use derivative financial instruments including but not limited to

currency forward exchange contracts currency swaps interest rate swaps and call options

on a rolling basis within a pre-approved time period in the amount up to US$7300 million.On the same day the Issuer also announced that the board of directors of the Issuer

resolved to entrust qualified banks securities firms fund managers insurers and asset

managers with no more than RMB30 billion to invest in wealth management products with

a high level of security good liquidity and a low/medium risk profile to utilise the Group’s

own funds and increase the Group’s capital investment income.– 5 –SUMMARY FINANCIAL INFORMATION AND OTHER DATA

The following tables set forth the summary consolidated financial information of the Group

as at and for the periods indicated.The selected consolidated financial statements of the Group as at and for the years ended 31

December 2022 2023 and 2024 set forth below have been extracted from the Group’s

consolidated financial statements as at and for the years ended 31 December 2023 and 2024

which have been audited by Ernst & Young Hua Ming LLP the independent auditors and

incorporated by reference in this Offering Circular.The Audited Financial Statements have been prepared and presented in Chinese in

accordance with PRC GAAP. PRC GAAP is substantially in line with IFRS except for

certain modifications which reflect the PRC’s unique circumstances and environment.Accordingly potential investors must exercise caution when using such Audited Financial

Statements to evaluate the Group’s financial condition and results of operations. For asummary of certain differences see “Description of Certain Differences between PRC GAAPand IFRS”.The selected financial information of the Group as at and for the years ended 31 December

2022 2023 and 2024 have been derived from the English translation of the Audited

Financial Statements. The English translation of such consolidated financial statements the

auditors’ reports and the related notes have been included elsewhere in this Offering

Circular.None of the Lead Managers the Trustee or the Agents or any of their respective directors

officers employees representatives agents advisers or affiliates or any person who

controls any of them has independently verified or checked the accuracy of the translated

Audited Financial Statements and can give no assurance that the information contained in

the translated Audited Financial Statements is accurate truthful or complete. Potential

purchasers must exercise caution when using such financial information to evaluate the

financial condition results of operations and prospects of the Group.The information set out below should be read in conjunction with and is qualified in its

entirety by reference to the Audited Financial Statements included elsewhere in this

Offering Circular. Historical results of the Group are not necessarily indicative of results

that may be achieved for any future period.– 6 –SUMMARY OF AUDITED CONSOLIDATED BALANCE SHEET

As at 31 December

202220232024

(RMB’000) (RMB’000) (RMB’000)

(audited) (audited) (audited)

Current assets:

Currency cash . . . . . . . . . . . . . . . . . . . . . . . . 56346367 78543219 43885348

Trading financial assets . . . . . . . . . . . . . . . . . . 513784 153285 13768781

Derivative financial assets . . . . . . . . . . . . . . . . 132125 85341 173439

Trade receivables . . . . . . . . . . . . . . . . . . . . . . 17751390 20821526 21288393

Factored trade receivables . . . . . . . . . . . . . . . . 81525 3503 6498

Receivable financing . . . . . . . . . . . . . . . . . . . . 3712142 4074078 4243041

Prepayments. . . . . . . . . . . . . . . . . . . . . . . . . . 278724 242440 692097

Other receivables . . . . . . . . . . . . . . . . . . . . . . 1346935 1146400 2597585

Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . 45234990 41131259 41257657

Contract assets . . . . . . . . . . . . . . . . . . . . . . . . 4851066 4844974 4972074

Non-current assets due within one year . . . . . . . — — 3085

Other current assets . . . . . . . . . . . . . . . . . . . . 7624795 7458528 8899348

Total current assets . . . . . . . . . . . . . . . . . . . . . 137873843 158504553 141787346

Non-current assets:

Debt investment . . . . . . . . . . . . . . . . . . . . . . . — — 25068445

Long-term receivables . . . . . . . . . . . . . . . . . . . 2562213 2013559 833972

Factored long-term receivables . . . . . . . . . . . . . 186025 10509 8664

Investment in associates and joints . . . . . . . . . . 1754030 2157550 2333836

Other non-current financial assets . . . . . . . . . . 1028262 831930 715761

Investment properties . . . . . . . . . . . . . . . . . . . 2010627 1473823 99045

Property plant and equipment . . . . . . . . . . . . . 12913313 13372364 14178419

Construction in progress . . . . . . . . . . . . . . . . . 964004 987803 685376

Right-of-use assets . . . . . . . . . . . . . . . . . . . . . 1079521 1557313 1551573

Intangible assets . . . . . . . . . . . . . . . . . . . . . . . 7341866 7697446 7159200

Development costs . . . . . . . . . . . . . . . . . . . . . 2584570 1301545 1594563

Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 14425

Deferred tax assets . . . . . . . . . . . . . . . . . . . . . 3718544 4145923 4396088

Other non-current assets . . . . . . . . . . . . . . . . . 6936756 6904000 6896517

Total non-current assets . . . . . . . . . . . . . . . . . . 43079731 42453765 65535884

TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . 180953574 200958318 207323230

Current liabilities:

Short-term loans. . . . . . . . . . . . . . . . . . . . . . . 9962315 7560358 7027070

Bank advances on factored trade receivables . . . 84550 3687 6498

Derivative financial liabilities . . . . . . . . . . . . . . 201717 184544 200853

Short-term bonds payable . . . . . . . . . . . . . . . . — 5012890 —

Bills payable . . . . . . . . . . . . . . . . . . . . . . . . . 10629852 9442739 10959334

Trade payables . . . . . . . . . . . . . . . . . . . . . . . . 19074746 18931425 22371792

Contract liabilities . . . . . . . . . . . . . . . . . . . . . 17699861 14889658 12859416

Employee benefits payable . . . . . . . . . . . . . . . . 13222179 16176919 16991686

Taxes payable . . . . . . . . . . . . . . . . . . . . . . . . 1447082 1413093 1205018

Other payables . . . . . . . . . . . . . . . . . . . . . . . . 2889964 3844735 3236993

Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . 2549490 2568768 2184073

Non-current liabilities due within one year . . . . 661744 3001598 5592740

Total current liabilities . . . . . . . . . . . . . . . . . . 78423500 83030414 82635473

– 7 –As at 31 December

202220232024

(RMB’000) (RMB’000) (RMB’000)

(audited) (audited) (audited)

Non-current liabilities:

Long-term loans . . . . . . . . . . . . . . . . . . . . . . . 35125988 42576057 44058915

Bank advances on factored long-term trade

receivables . . . . . . . . . . . . . . . . . . . . . . . . . 195210 11062 8664

Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . — — 1004880

Lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . 788649 960459 972943

Long-term employee benefits payable . . . . . . . . 144874 141762 153647

Deferred income . . . . . . . . . . . . . . . . . . . . . . . 2322076 2315842 1496556

Deferred tax liabilities . . . . . . . . . . . . . . . . . . . 87144 77865 90651

Other non-current liabilities . . . . . . . . . . . . . . . 4322910 3513412 3791219

Total non-current liabilities . . . . . . . . . . . . . . . 42986851 49596459 51577475

TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . 121410351 132626873 134212948

Shareholder’s equity:

Share capital . . . . . . . . . . . . . . . . . . . . . . . 4736113 4783252 4783535

Capital reserve . . . . . . . . . . . . . . . . . . . . . . 25892832 27603291 27476099

Other comprehensive income . . . . . . . . . . . . (2352743) (2199965) (2465531)

Special reserve . . . . . . . . . . . . . . . . . . . . . . 26553 53394 88214

Surplus reserve . . . . . . . . . . . . . . . . . . . . . . 3029811 3053382 3053523

Retained profits . . . . . . . . . . . . . . . . . . . . . 27308621 34714953 39872643

Total equity attributable to holders of ordinary

shares of the parent . . . . . . . . . . . . . . . . . . . 58641187 68008307 72808483

Non-controlling interests . . . . . . . . . . . . . . . . . 902036 323138 301799

Total owners’ equity . . . . . . . . . . . . . . . . . . . . 59543223 68331445 73110282

TOTAL LIABILITIES AND OWNERS’

EQUITY . . . . . . . . . . . . . . . . . . . . . . . . . . 180953574 200958318 207323230

– 8 –SUMMARY OF AUDITED CONSOLIDATED INCOME STATEMENT

Years ended 31 December

202220232024

(RMB’000) (RMB’000) (RMB’000)

(restated)

Operating revenue . . . . . . . . . . . . . . . . . . . . . . 122954418 124250878 121298752

Less: Operating costs . . . . . . . . . . . . . . . . . . . 77227569 72702602 75311066

Taxes and surcharges . . . . . . . . . . . . . . . 950767 1335662 1175971

Selling and distribution costs . . . . . . . . . . 9173329 10119542 8900503

Administrative expenses . . . . . . . . . . . . . 5332728 5631779 4477021

Research and development costs. . . . . . . . 21602300 25289211 24031499

Finance costs . . . . . . . . . . . . . . . . . . . . . 163207 (1101192) (264570)

Add: Other income . . . . . . . . . . . . . . . . . . . . . 1892972 1805981 2932725

Investment income . . . . . . . . . . . . . . . . . 1087498 (205027) 112394

Gains from changes in fair values . . . . . . . (1141849) (702284) (625131)

Credit impairment losses . . . . . . . . . . . . . (369304) (75796) 92454

Asset impairment losses. . . . . . . . . . . . . . (1190030) (858366) (933182)

Gains from asset disposal . . . . . . . . . . . . 11029 20597 95659

Operating profit . . . . . . . . . . . . . . . . . . . . . . . 8794834 10258379 9342181

Add: Non-operating income. . . . . . . . . . . . . . . 195804 173063 76279

Less: Non-operating expenses. . . . . . . . . . . . . . 238982 228302 188855

Total profit . . . . . . . . . . . . . . . . . . . . . . . . . . 8751656 10203140 9229605

Less: Income tax. . . . . . . . . . . . . . . . . . . . . 960046 962291 873992

Net profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7791610 9240849 8355613

Analysed by continuity of operations

Net profit from continuing operations . . . . . 7791610 9240849 8355613

Analysed by ownership

Holders of ordinary shares of the parent . . . . 8080295 9325753 8424792

Non-controlling interests . . . . . . . . . . . . . . . (288685) (84904) (69179)

Other comprehensive income net of tax . . . . . . (67167) 149253 (265303)

Other comprehensive income attributable to

holders of ordinary shares of the parent

company net of tax. . . . . . . . . . . . . . . . . . . (65722) 152778 (265566)

Other comprehensive income that cannot be

reclassified to profit or loss . . . . . . . . . . . . . 1509 985 (3358)

Other comprehensive income that will be

reclassified to profit or loss . . . . . . . . . . . . . (67231) 151793 (262208)

Other comprehensive income attributable to

non-controlling interests net of tax. . . . . . . . (1445) (3525) 263

Total comprehensive incomes . . . . . . . . . . . . . . 7724443 9390102 8090310

Attributable to:

Holders of ordinary shares of the parent . . . . 8014573 9478531 8159226

Non-controlling interests . . . . . . . . . . . . . . . (290130) (88429) (68916)

Earnings per share (RMB/share)

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RMB1.71 RMB1.96 RMB1.76

Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . RMB1.71 RMB1.96 RMB1.76

– 9 –SUMMARY OF AUDITED CONSOLIDATED CASH FLOW STATEMENT

Years ended 31 December

202220232024

(RMB’000) (RMB’000) (RMB’000)

Cash flows from operating activities

Cash received from sale of goods or rendering of

services . . . . . . . . . . . . . . . . . . . . . . . . . . . 136874889 128264163 127930762

Refunds of taxes. . . . . . . . . . . . . . . . . . . . . . . 7518815 5355413 5320200

Other cash received in relation to operating

activities. . . . . . . . . . . . . . . . . . . . . . . . . . . 6089720 10666423 6563537

Sub-total of cash inflows . . . . . . . . . . . . . . . . . 150483424 144285999 139814499

Cash paid for goods and services . . . . . . . . . . . 96473887 74064351 75666643

Cash paid to and on behalf of employees . . . . . 26152518 28697009 28935061

Cash paid for various types of taxes . . . . . . . . . 9001574 8652058 8047637

Other cash paid in relation to operating activities 11277745 15466882 15685314

Sub-total of cash outflows . . . . . . . . . . . . . . . . 142905724 126880300 128334655

Net cash flows from operating activities . . . . . . . 7577700 17405699 11479844

Cash flows from investing activities

Cash received from sale of investments . . . . . . . 13449728 10547704 80388840

Cash received from return on investment. . . . . . 1106970 1287109 1986934

Net cash received from the disposal of property

plant and equipment intangible assets and

other long-term assets . . . . . . . . . . . . . . . . . 24173 104486 535436

Net cash received from the disposal of

subsidiaries and other operating units . . . . . . 116836 38486 —

Other cash received in relation to investing

activities. . . . . . . . . . . . . . . . . . . . . . . . . . . — — 105749

Sub-total of cash inflows . . . . . . . . . . . . . . . . . 14697707 11977785 83016959

Cash paid to acquisition of property plant and

equipment intangible assets and other

long-term assets . . . . . . . . . . . . . . . . . . . . . 4951916 4004683 4014730

Cash paid for acquisition of investments . . . . . . 11010174 28874455 107674648

Other cash paid in relation to investing activities 27016 — —

Sub-total of cash outflows . . . . . . . . . . . . . . . . 15989106 32879138 111689378

Net cash flows from investing activities . . . . . . . (1291399) (20901353) (28672419)

Cash flows from financing activities

Cash received from capital injection . . . . . . . . . 171231 1676157 374322

Cash received from borrowings . . . . . . . . . . . . 148942904 274690500 190217674

Other cash received in relation to financing

activities. . . . . . . . . . . . . . . . . . . . . . . . . . . — 2200 —

Sub-total of cash inflows . . . . . . . . . . . . . . . . . 149114135 276368857 190591996

Cash repayment of borrowings . . . . . . . . . . . . . 143536892 263526293 190470434

Cash payments for distribution of dividends

profits and for interest expenses . . . . . . . . . . 3687580 4836200 5419138

Other cash paid in relation to financing activities 434835 634774 520799

Sub-total of cash outflows . . . . . . . . . . . . . . . . 147659307 268997267 196410371

Net cash flows from financing activities . . . . . . . 1454828 7371590 (5818375)

Effect of changes in foreign exchange rate on cash

and cash equivalents . . . . . . . . . . . . . . . . . . . 260017 65502 24200

Net increase in cash and cash equivalents . . . . . . 8001146 3941438 (22986750)

Add: cash and cash equivalents at beginning

of year . . . . . . . . . . . . . . . . . . . . . . . . 39070583 47071729 51013167

Net balance of cash and cash equivalents at the end

of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47071729 51013167 28026417

– 10 –THE OFFERING

The following summary contains basic information about the Bonds and is not intended to be

complete. It does not contain all the information that is important to investors. For a more

complete description of the Bonds please refer to the section of this Offering Circular entitled

“Terms and Conditions of the Bonds.” Phrases used in this summary and not otherwise definedshall have the meaning given to them in the section entitled “Terms and Conditions of theBonds”.Issuer . . . . . . . . . . . . . . . ZTE Corporation (中興通訊股份有限公司).Bonds . . . . . . . . . . . . . . . RMB3584 million U.S. dollar settled zero coupon

convertible bonds due 2030.The issue of the Bonds and the right of conversion into H

Shares were authorised by resolutions of the board of

directors of the Issuer passed on 27 July 2025.A Shares . . . . . . . . . . . . . Ordinary domestic share(s) with a par value of RMB1.00

each issued by the Issuer which are listed for trading on the

Shenzhen Stock Exchange and traded in Renminbi (Stock

Code: 000063).H Shares . . . . . . . . . . . . . Ordinary foreign share(s) with a par value of RMB1.00 each

issued by the Issuer which are listed on the Hong Kong

Stock Exchange and traded in Hong Kong dollars (Stock

Code: 00763).Issue Price . . . . . . . . . . . . The Bonds will be issued at 100.0 per cent. of their principal

amount.Interest . . . . . . . . . . . . . . The Bonds are zero coupon and do not bear interest.Issue Date . . . . . . . . . . . . 5 August 2025.Maturity Date . . . . . . . . . 5 August 2030.Redemption at Maturity . . . Unless previously redeemed converted or purchased and

cancelled as provided in the Terms and Conditions the

Issuer will redeem each Bond at the U.S. Dollar Equivalent

of its outstanding principal amount on the Maturity Date.See “Terms and Conditions of the Bonds — RedemptionPurchase and Cancellation — Maturity”.– 11 –Status of the Bonds . . . . . . The Bonds will constitute direct unsubordinated

unconditional and (subject to Condition 3.1 (Negative

Pledge) of the Terms and Conditions) unsecured

obligations of the Issuer and shall at all times rank pari

passu and without any preference or priority among

themselves. The payment obligations of the Issuer under

the Bonds shall save for such exceptions as may be provided

by mandatory provisions of applicable law and subject to

Condition 3.1 (Negative Pledge) of the Terms and

Conditions at all times rank at least equally with all of its

other present and future direct unsubordinatedunconditional and unsecured obligations. See “Terms andConditions of the Bonds — Status”.Negative Pledge . . . . . . . . So long as any Bond remains outstanding (as defined in the

Trust Deed) the Issuer will not create or permit to subsist

and the Issuer will procure that no Subsidiary will create or

have outstanding any mortgage charge pledge lien or

other form of encumbrance or security interest upon the

whole or any part of its undertaking assets or revenues

(including any uncalled capital) present or future to secure

any Relevant Indebtedness or to secure any guarantee or

indemnity in respect of any Relevant Indebtedness unless at

the same time or prior thereto according to the Bonds the

same security as is created or subsisting to secure any such

Relevant Indebtedness guarantee or indemnity or such

other security as shall be approved by an Extraordinary

Resolution (as defined in the Trust Deed) of theBondholders. See “Terms and Conditions of the Bonds —Negative Pledge”.– 12 –Conversion Right . . . . . . . . Subject as provided in the Terms and Conditions each Bond

shall entitle the holder to convert such Bond into H Shares

(the “Conversion Right”). Subject to and upon compliance

with the Terms and Conditions the Conversion Right

attaching to any Bond may be exercised at the option of

the Bondholder at any time on or after the 41st day after

the Issue Date up to the close of business (at the place where

the Certificate evidencing such Bond is deposited for

conversion) on the date falling seven working days prior

to the Maturity Date (both days inclusive) or if such Bond

shall have been called for redemption by the Issuer before

the Maturity Date then up to and including the close of

business (at the place aforesaid) on a date no later than

seven working days (at the place aforesaid) prior to the date

fixed for redemption thereof; provided that no Conversion

Right may be exercised in respect of a Bond where the

holder shall have exercised its right to require the Issuer to

redeem or repurchase such Bond pursuant to Condition 7.4

(Redemption at the Option of the Bondholders) or Condition

7.5 (Redemption for Relevant Events) of the Terms and

Conditions or during a Restricted Conversion Period (both

dates inclusive); provided further that the Conversion Right

is exercised subject to any applicable fiscal or other laws or

regulations or as hereafter provided in the Terms and

Conditions (the “Conversion Period”). See “Terms andConditions of the Bonds — Conversion Right”.Conversion Price . . . . . . . . The price at which H Shares will be issued upon conversion

will initially be HK$30.25 per H Share but will be subject to

adjustments for among other things consolidation

subdivision or reclassification capitalisation of profits or

reserves capital distributions rights issues of Shares or

options over Shares rights issues of other securities issues

at less than current market price and certain other dilutiveevents. See “Terms and Conditions of the Bonds —Conversion — Adjustments to Conversion Price”.– 13 –Redemption for Taxation At any time the Issuer may having given not less than 30

Reasons. . . . . . . . . . . . . nor more than 60 days’ notice to the Trustee the Principal

Agent and the Bondholders (which notice shall be

irrevocable) redeem all but not some only of the Bonds at

the U.S. Dollar Equivalent of their outstanding principal

amount as at the date fixed for redemption if the Issuer

satisfies the Trustee immediately prior to the giving of such

notice that (i) the Issuer has or will become obliged to pay

Additional Tax Amounts as provided or referred to in

Condition 8 (Taxation) of the Terms and Conditions as a

result of any change in or amendment to the laws or

regulations of the PRC or Hong Kong or in each case any

political subdivision or any authority thereof or therein

having power to tax or any change in the general

application or official interpretation of such laws or

regulations which change or amendment becomes effective

on or after 28 July 2025 and (ii) such obligation cannot be

avoided by the Issuer taking reasonable measures available

to it provided that no such notice of redemption shall be

given earlier than 90 days prior to the earliest date on which

the Issuer would be obliged to pay such Additional Tax

Amounts were a payment in respect of the Bonds then due.If the Issuer gives a notice of redemption pursuant to

Condition 7.3 (Redemption for Taxation Reasons) of the

Terms and Conditions each Bondholder will have the right

to elect that his Bond(s) shall not be redeemed and that the

provisions of Condition 8 (Taxation) of the Terms and

Conditions shall not apply in respect of any payment of

principal or interest (if any) to be made in respect of such

Bond(s) which falls due after the relevant Tax Redemption

Date whereupon no Additional Tax Amounts shall be

payable in respect thereof pursuant to Condition 8

(Taxation) of the Terms and Conditions and payment of

all amounts shall be made subject to the deduction or

withholding of the taxation required to be withheld or

deducted by the government of the PRC or Hong Kong or

in each case any political subdivision or any authoritythereof or therein having power to tax.. See “Terms andConditions of the Bonds — Redemption Purchase andCancellation — Redemption for Taxation Reasons”.– 14 –Redemption at the Option of On giving not less than 30 nor more than 60 days’ notice to

the Issuer . . . . . . . . . . . the Bondholders (which notice will be irrevocable) the

Trustee and the Principal Agent the Bonds may be

redeemed by the Issuer in whole but not in part at the

U.S. Dollar Equivalent of their outstanding principal

amount as at date fixed for redemption if at any time the

aggregate principal amount of the Bonds outstanding is less

than 10 per cent. of the aggregate principal amount

originally issued (including any Bonds issued in

accordance with Condition 15 (Further Issues) of theTerms and Conditions). See “Terms and Conditions of theBonds — Redemption Purchase and Cancellation —Redemption at the Option of the Issuer”.Redemption at the Option of The holder of each Bond will have the right at such holder’s

the Bondholders . . . . . . . option to require the Issuer to redeem all or some only ofthat holder’s Bonds on 5 August 2028 (the “Put OptionDate”) at the U.S. Dollar Equivalent of their outstandingprincipal amount on the Put Option Date. See “Terms andConditions of the Bonds — Redemption Purchase and

Cancellation — Redemption at the Option of theBondholders”.Redemption for Relevant Following the occurrence of a Relevant Event the holder of

Events . . . . . . . . . . . . . . each Bond will have the right at such holder’s option to

require the Issuer to redeem all or some only of such

holder’s Bonds on the Relevant Event Put Date at the U.S.Dollar Equivalent of their outstanding principal amount as

at the Relevant Event Put Date. A “Relevant Event” means

the occurrence of either (a) a Change of Control in the

Issuer; (b) a Delisting or (c) an H Share Suspension inTrading. See “Terms and Conditions of the Bonds —Redemption Purchase and Cancellation — Redemption forRelevant Events”.– 15 –Lock-up . . . . . . . . . . . . . . The Issuer has agreed in the Subscription Agreement that

neither the Issuer nor any person acting on its behalf will (a)

issue offer sell pledge encumber contract to sell or

otherwise dispose of or grant options issue warrants or

offer rights entitling persons to subscribe or purchase any

interest in any Shares or securities of the same class as the

Bonds or the Shares or any securities convertible into

exchangeable for or which carry rights to subscribe or

purchase the Bonds the Shares or securities of the same

class as the Bonds the Shares or other instruments

representing interests in the Bonds the Shares or other

securities of the same class as them (b) enter into any swap

or other agreement that transfers in whole or in part any of

the economic consequences of the ownership of the Shares

(c) enter into any transaction with the same economic effect

as or which is designed to or which may reasonably be

expected to result in or agree to do any of the foregoing

whether any such transaction of the kind described in (a)

(b) or (c) is to be settled by delivery of Shares or other

securities in cash or otherwise or (d) announce or otherwise

make public an intention to do any of the foregoing in any

such case without the prior written consent of the Lead

Managers between the date hereof and the date which is 90

days after the Issue Date (both dates inclusive); except for (i)

the Bonds and the New Shares issued on conversion of the

Bonds or (ii) any Shares or other securities (including rights

or options) which are issued offered exercised allotted

appropriated modified or granted to or for the benefit of

employees (including directors) of the Issuer or any of its

subsidiaries pursuant to any employee share scheme or plan

existing as at the date of the Subscription Agreement.Events of Default . . . . . . . The Trustee may give notice to the Issuer that the Bonds are

and they shall accordingly thereby become immediately due

and repayable at the U.S. Dollar Equivalent of their

principal amount without prejudice to the right of

Bondholders to exercise the Conversion Right in respect of

their Bonds in accordance with Condition 5 of the Terms

and Conditions if any of the events listed under Condition 9of the Terms and Conditions has occurred. See “Terms andConditions of the Bonds — Events of Default”.Form and Denomination of The Bonds will be issued in registered form in the specified

Bonds . . . . . . . . . . . . . . denomination of RMB2000000 each and integral multiples

of RMB1000000 in excess thereof.– 16 –Further Issues . . . . . . . . . . The Issuer may from time to time without the consent of the

Bondholders create and issue further bonds having the

same terms and conditions as the Bonds in all respects (or in

all respects except for the issue date and the timing for

complying with the requirements set out in the Terms and

Conditions in relation to the Initial NDRC Post-Issuance

Filing the CSRC Post-Issuance Filings and the Foreign

Debt Registration) and so that such further issue shall be

consolidated and form a single series with the Bonds. See

“Terms and Conditions of the Bonds — Further Issues”.Clearing Systems. . . . . . . . The Bonds will be represented initially by beneficial interests

in the Global Certificate which will be registered in the

name of a nominee of and deposited on the Issue Date with

a common depositary for Euroclear and Clearstream.Beneficial interests in the Global Certificate will be shown

on and transfers thereof will be effected only through

records maintained by Euroclear and Clearstream. Except as

described in the Global Certificate certificates for the

Bonds will not be issued in exchange for beneficial

interests in the Global Certificate.Listing . . . . . . . . . . . . . . . Application will be made to the Hong Kong Stock Exchange

for the listing of and permission to deal in the Bonds on the

Hong Kong Stock Exchange by way of debt issues to

Professional Investors only and it is expected that listing of

and permission to deal in the Bonds on the Hong Kong

Stock Exchange will commence on 6 August 2025.The H-Shares are listed on the Hong Kong Stock Exchange.Application has been made to the Hong Kong Stock

Exchange for the listing of the H-Shares issuable upon

conversion of the Bonds (the “New Shares”).Trustee . . . . . . . . . . . . . . China Construction Bank (Asia) Corporation Limited (中國

建設銀行（亞洲）股份有限公司).Principal Paying Agent and China Construction Bank (Asia) Corporation Limited (中國

Conversion Agent . . . . . . 建設銀行（亞洲）股份有限公司).Registrar and Transfer Agent China Construction Bank (Asia) Corporation Limited (中國

建設銀行（亞洲）股份有限公司).Governing Law . . . . . . . . . The Bonds the Trust Deed and the Agency Agreement and

any non-contractual obligations arising out of or in

connection with them will be governed by and shall be

construed in accordance with English law.Use of Proceeds . . . . . . . . See “Use of Proceeds”.– 17 –Risk Factors . . . . . . . . . . . For a discussion of certain factors that should be consideredin evaluating an investment in the Bonds see “RiskFactors”.Selling Restrictions . . . . . . There are restrictions on the offer sale and transfer of the

Bonds in among others the United States the United

Kingdom EEA the PRC Hong Kong Singapore and

Japan. For a description of the selling restrictions on offerssales and deliveries of the Bonds see “Subscription andSale”.Legal Entity Identifier (LEI) 3003004FBGVVG1CW5U45.ISIN . . . . . . . . . . . . . . . . XS3140158430.Common Code . . . . . . . . . 314015843.Notes:

(1) Concurrent with the offering of the Bonds CLSA Limited may facilitate sales of existing H shares

notionally underlying the Bonds by buyers of the Bonds who wish to sell such H shares in short sales to

purchasers procured by CLSA Limited in order to hedge the market risk to which buyers of the Bonds are

exposed with respect to the Bonds that they may acquire in the offering of the Bonds.– 18 –RISK FACTORS

An investment in the Bonds is subject to significant risks. You should carefully consider all of

the information in this Offering Circular and in particular the risks described below before

deciding to invest in the Bonds. The following describes some of the significant risks that could

affect us and the value of the Bonds. Some risks may be unknown to us and other risks

currently believed to be immaterial could become material. All of these could materially and

adversely affect our business financial condition and results of operations. The risks described

below do not necessarily comprise all those faced by the Group and are not intended to be

presented in any assumed order of priority. The market price of the Bonds could decline due to

any of these risks and you may lose all or part of your investment. The investment referred to

in this Offering Circular may not be suitable for all of its recipients. Investors are accordingly

advised to consult an investment advisor before making a decision to subscribe for the Bonds.This Offering Circular also contains forward-looking statements that involve risks and

uncertainties. Our actual results could differ materially from those anticipated in these

forward-looking statements as a result of certain factors including the risks faced by us

described below and elsewhere in this Offering Circular.RISKS RELATING TO OUR GROUP AND BUSINESS

We are dependent on our ability to continuously introduce new innovative products through our

R&D efforts.The information and communication technology industries are characterised by rapid

technological changes frequent introductions of new products and solutions constant

innovation and keen global competition. The industries are also susceptible to changes in

product life cycles. These rapid technological developments require us to consider the

regulatory standards integrate new technology into our products create new and relevant

product categories and adapt to changing business models in a timely manner.Our competitors may develop or acquire alternative and competing technologies and

standards that could allow them to create new and disruptive products and/or produce

similar competitive products at lower costs of production thus rendering our products less

competitive or obsolete. Our ability to compete effectively will therefore depend on our

ability to adapt to advancements in engineering and production technologies to meet our

customers’ needs our ability to identify and leverage on new trends in the market and our

ability to innovate on our R&D capabilities.In order to keep pace with technological and regulatory changes and compete effectively

the Group needs to invest significant resources in R&D to maintain market position. The

Group’s R&D expenses were RMB21602.3 million RMB25289.2 million and

RMB24031.5 million for the years ended 31 December 2022 2023 and 2024 respectively

representing 17.57% 20.35% and 19.81% of the Group’s revenue for the same period

respectively. With technological advancement particularly the growth of AI technologies

and applications the Group may incur substantial R&D expenses during the periods of

technological transformation to adapt to the evolving competitive landscape and

technology development and lay a foundation for future growth. Given the inherent

uncertainties of R&D activities there can be no guarantee that the Group will continue to

succeed in technological innovations and effectively commercialise them. The Group’s

business and results of operations may be adversely affected if it does not operate as

– 19 –efficiently as its competitors or if the Group cannot adapt on a timely basis to technological

changes or if the Group is unable to effectively engage in R&D to introduce new products

which meet the needs of the market in a timely manner.We operate in a highly competitive industry and may not be able to continue competing

successfully.Our business is highly competitive and we face competition from other market participants.Some competitors may enter markets we serve and sell products at lower prices in order to

gain and obtain a greater market share. Our competitors may be able to respond more

quickly to new or emerging technologies and changes in customer requirements. They may

also be able to devote greater resources to the development promotion and sale of their

products and services than we can. Current and potential competitors may make strategic

acquisitions or establish cooperative relationships among themselves or with third parties

that enhance their ability to address the needs of our prospective customers. It is possible

that new competitors or alliances among current and new competitors may emerge and

rapidly gain significant market share. Our competitors may also produce products that are

equal or superior to our products or engage in aggressive pricing in order to gain or

increase market share which could subject our products to downward price pressures

reduce our market share reduce our overall sales and require us to invest additional funds

in new technology development or if we are not able to match such lower pricing. This may

have a material adverse effect on our business including our financial position results of

operations and cash flow.While our continued innovation to the technologies and qualities shown in our products

and services may keep us competitive there is no assurance that we will continue to remain

competitive. In the event that we are unable to retain our existing customers and/or attract

new customers amidst the competition our business results of operations financial

position and cash flow may be materially and adversely affected.We are subject to risks associated with international trade policies export controls and

economic sanctions in particular trade restrictions and sanctions imposed by the United

States and our reputation business results of operations and financial condition could be

adversely affected.We are subject to deterioration in the political and economic relations among countries and

sanctions and export controls administered by government authorities and other

geopolitical challenges including but not limited to economic and labor conditions

increased custom duties tariffs taxes and other costs and political instability. Our sales and

operations could be materially and adversely affected by international trade regulations

including custom duties tariffs and anti-dumping penalties and imposition of trade

restrictions. In particular the U.S. government imposed economic and trade sanctions

directly or indirectly affecting China-based technology companies. It is possible that the

extent and scope of such sanctions may escalate. There is no assurance as to how the

U.S.-China trade tensions might develop or whether there will be any changes to the scope

and extent of goods that are or will be subject to such export controls sanctions tariffs or

new trade policies introduced by the two countries. We cannot predict the implications of

the ongoing U.S.-China trade tensions and the resulting impact on our industry and the

global economy.– 20 –In recent years the United States has increased export controls restrictions on the PRC

through the U.S. Export Administration Regulations (“EAR”) administered by the U.S.Department of Commerce’s Bureau of Industry and Security (“BIS”) which includes a list

of foreign persons on which certain trade restrictions are imposed (the “Entity List”). The

export re-export and/or transfer (in-country) of items subject to the EAR to a listed foreign

person is generally prohibited unless the specified license requirements are met.On March 8 2016 the BIS decided to add ZTE Corporation (“ZTE” or “the Company”) its

wholly-owned subsidiary ZTE Kangxun Telecommunications Ltd. (“ZTE Kangxun”

collectively with the ZTE as “the Subject Companies”) ZTE Parsian and Beijing 8 Star

International Co. Ltd. to the Entity List (the “Decision”). According to this Decision

suppliers of products under EAR were required to apply for export licenses before

supplying such products to the Company and the aforementioned three other companies

with a presumption of denial licensing policy in effect. On March 24 2016 BIS amended

this Decision by issuing a temporary general license postponing enforcement of export

restrictions on ZTEC until June 30 2016. Subsequently from June 2016 through February

2017 BIS extended this temporary general license four times.In March 2017 the Subject Companies reached agreements (collectively the “2017Agreements”) with the BIS the U.S. Department of Justice (“DOJ”) and the Office of

Foreign Assets Control (“OFAC”) of the U.S. Department of the Treasury regarding

investigations into its compliance with EAR and U.S. sanctions laws. These included a

settlement agreement with BIS (the “2017 Settlement Agreement”).On 15 April 2018 the BIS signed an order activating a previously suspended 7-year denialorder (commencing on 15 April 2018 and ended on 13 March 2025) (the “15 April 2018Denial Order”). The 15 April 2018 Denial Order restricted and prohibited the Subject

Companies from participating in any way whether directly or indirectly in any transaction

involving any commodity software or technology exported or to be exported from the

United States that is subject to the EAR or any other activities subject to control under

EAR. The full text of the 15 April 2018 Denial Order was published in the United States

Federal Register (Federal Register Vol. 83 p. 17644) on 23 April 2018.In June 2018 the Subject Companies and BIS entered into a superseding settlement

agreement (“2018 Superseding Settlement Agreement”) to supersede the 2017 Settlement

Agreement. In accordance with the 2018 Superseding Settlement Agreement BIS issued a

new denial order for a period of ten years from 8 June 2018 (the “New Denial Order”)

which would among other things restrict and prohibit the Subject Companies from

applying for obtaining or using any license license exception or export control document

and participating in any way in any transaction involving any commodity software or

technology that is subject to EAR provided that such New Denial Order shall be suspended

during the period of ten years from 8 June 2018 (commencing on 8 June 2018 and ended on

7 June 2028) (the “Probationary Period”) and thereafter be waived subject to the Subject

Companies’ compliance with the 2018 Superseding Settlement Agreement. In addition in

accordance with the 2018 Superseding Settlement Agreement the Subject Companies had

paid civil monetary penalties totaling USD1.4 billion including a lump sum payment of

USD1 billion and an additional penalty of USD0.4 billion placed in an escrow account with

a U.S. bank suspended during the Probationary Period. The USD0.4 billion penalty will be

waived after the end of Probationary Period if the Subject Companies comply with the

probationary conditions set forth in the 2018 Superseding Settlement Agreement during the

Probationary Period.– 21 –In addition to the aforesaid requirements the Subject Companies were required to comply

with all applicable terms and conditions of the 2017 Agreements and 2018 Superseding

Settlement Agreement including but not limited to:

(i) The Subject Companies shall retain at its expense an independent special compliance

coordinator (“SCC”) within 30 days of 8 June 2018 to coordinate monitor assess and

report on compliance by ZTE and its subsidiaries or affiliates worldwide with the U.S.Export Administration Act of 1979 EAR the 2018 Superseding Settlement Agreement

etc. during the Probationary Period. The SCC will report to the chief executive officer

and the Board of Directors of the Subject Companies and to BIS equally. ZTE and its

subsidiaries and affiliates shall cooperate with all requests of the SCC. The Subject

Companies shall timely pay the SCC and its assistants and professional staff and shall

not hire employ or retain the SCC or any of his or her assistants or professional staff

for a period of five (5) years from the date of termination of the Probationary Period.(ii) The Subject Companies shall complete and submit nine audit reports of its compliance

with U.S. export control laws. At the conclusion of the term of the independent

compliance monitor created according to the agreement signed between the Company

and the United States Department of Justice and any related court orders the SCC is

responsible for conducting the six remaining audit reports. These audit reports shall

include a certification to BIS certifying that ZTE and its subsidiaries and affiliates are

in compliance with the terms of the 2018 Superseding Settlement Agreement. In

addition where said audit identifies actual or potential violations of EAR the Subject

Companies shall promptly provide copies of all related export control documents and

other pertinent documentation to the BIS.(iii) The Subject Companies shall ensure that all records required to be kept or retained

under the EAR are stored in or fully accessible from the United States.(iv) The Subject Companies shall provide extensive training on applicable export control

requirements to its leadership management and employees and the leadership

management and employees of its subsidiaries affiliates and other entities worldwide

over which it has ownership or control including informing its leadership

management employees contractors suppliers and others who deal in items subject

to the EAR that transfers of such items to sanctioned destinations are generally

prohibited unless legally authorised.(v) The Subject Companies shall provide and fully implement within six months of the

date of 8 June 2018 a comprehensive and updated export control compliance program

that transcends through all corporate levels of ZTE its subsidiaries affiliates and

other entities worldwide over which it has ownership or control including an annual

statement of corporate policy of export control compliance from the chief executive

officers of the Subject Companies to ensure compliance with the EAR.(vi) The Subject Companies shall replace the entire boards of directors of both the

Company and ZTE Kangxun (the “Subject Boards of Directors”) within 30 days of 8

June 2018. Within 30 days of replacing the Subject Boards of Directors the Subject

Companies shall create special audit/compliance committees under the Subject Boards

of Directors composed of three or more independent members of the new Subject

Boards of Directors. Within 30 days of 8 June 2018 the Subject Companies shall

terminate all current members of the senior leadership of both the Company and ZTE

– 22 –Kangxun at or above the senior vice president level as well any executive or officer who

participated in oversaw or was otherwise responsible for the conduct described in the

proposed charging letter issued by BIS in March 2017 or the 15 April 2018 Denial

Order and prohibit the re-hire of those employees by ZTE and any of its subsidiaries

or affiliates.(vii) The Subject Companies shall not take any action or make or permit to be made any

public statement directly or indirectly denying the allegations in the Proposed

Charging Letter the 2017 Settlement Agreement or 2018 Superseding Settlement

Agreement or other related document. In addition during the ten-year probationary

period the Subject Companies shall continue to cooperate fully with BIS the

Department of Justice and OFAC including with regard to the production of

documents and making witnesses available in any and all matters concerning any act

within the scope of or related to the conduct described in the Proposed Charging

Letter the 15 April 2018 Denial Order or related to other potential violations of U.S.export control laws occurring during the ten-year probationary period subject to

applicable law and regulations.(viii) The Subject Companies agree that its applicable obligations under the 2017

Agreements and 2018 Superseding Settlement Agreement shall be binding upon any

acquirer or successor in interest to the Subject Companies or substantially all of their

assets and liabilities or business.To fulfill the obligations under the 2017 Agreements and 2018 Superseding Settlement

Agreement the Issuer is required to provide and implement a comprehensive and updated

export control compliance programme that covers all levels of the Group. Measures

adopted by us as part of the said export control compliance programme include:. established the Export Compliance Committee of the Board which includes the

Issuer’s executive directors non-executive directors and independent non-executive

directors;. built a team led by Chief Export Compliance Officer and composed of export control

compliance team members with global coverage and engaged a number of counsels and

consultants;. established and enhanced the Issuer’s export control compliance management

structure system and procedure;. introduced and implemented the SAP Global Trade Services (GTS) System

self-developed the Enterprise Compliance Service System (ECSS) and achieved

integration with key business systems to automate key aspects of export compliance

management; carried out Export Control Classification Number (“ECCN”)

Publication Project which makes available to its customers and business partners

the applicable ECCN information and other export control information for products

subject to the EAR via a public website;. continued to provide online and offline export compliance training for senior

management subsidiaries compliance liaisons account managers and new

employees; and

– 23 –. cooperated with the special compliance coordinator to conduct various monitoring and

compliance audits; and made continuous investment on the work on export control

compliance.The Issuer attaches significant importance to the work on export control compliance

regarding compliance as a foundation for the Group’s strategy and condition and

bottom-line for the Group’s operations. The Issuer is committed to effectively

implementing the current export control compliance programme and fulfilling its

obligations under the 2017 Agreements and 2018 Superseding Settlement Agreement.However possibly due to potential performance disputes or other reasons the Issuer may

be deemed in violation of obligations under the 2017 Agreements and 2018 Superseding

Settlement Agreement (i) the suspended New Denial Order might be activated which

would among other things restrict and prohibit the Group from applying for obtaining or

using any license license exception or export control document and participating in any

transaction involving any commodity software or technology that is subject to the EAR;

and (ii) the USD0.4 billion placed in an escrow account with a U.S. bank shall become

payable immediately and shall be paid in full or in part which in turn could adversely affect

the Group’s business results of operation and financial condition.Furthermore similar or more expansive trade and export control restrictions or regulations

that may be imposed by the U.S. or other jurisdictions on any member of the Group in the

future may materially and adversely affect our ability to acquire technologies systems

devices or components that may be critical to our technology infrastructure product

offerings and business operations. Any uncertainties and changes in these current or future

restrictions or regulations may have a negative impact on our reputation and business. If we

or certain of our customers and suppliers are listed on the Entity List and subject to

restrictions from sourcing or selling technologies software or components from or to us

we may not be able to obtain extend or maintain the requisite regulatory permits in relation

to our transactions with these customers and suppliers.In addition on 9 August 2023 the U.S. government issued the Executive Order on

Addressing United States Investments in Certain National Security Technologies and

Products in Countries of Concern granting the U.S. government the authority to establish

and enforce an outbound investment regulatory regime on U.S. persons. On 28 October

2024 the U.S. Department of the Treasury issued the Provisions Pertaining to U.S.

Investments in Certain National Security Technologies and Products in Countries of

Concern (the “Final Rule”) to implement the Executive Order of 9 August 2023. The Final

Rule became effective on 2 January 2025. The Final Rule applies to investments by U.S.persons into “covered foreign persons” which are “persons of a country of concern”

engaged in certain “covered activities” in three identified sectors pertaining to national

security technologies and products: (i) semiconductors and microelectronics (ii) quantum

information technologies and (iii) artificial intelligence. While we expect we would be a

“covered foreign person” under the Final Rule we do not expect investments by U.S.persons in us (including the purchase of the Bonds a “contingent equity interest” and thesubsequent conversion of the contingent equity interest) to constitute “prohibitedtransactions” under the Final Rule. While such an investment may constitute a

“notifiable transaction” there are various exceptions that may apply under the Final

Rule. It is important to note that there is no assurance that the U.S. Department of the

Treasury will take the same view on any of these issues. In addition the Final Rule may

increase the compliance burden of U.S. investors and may cause certain U.S. investors to

– 24 –adopt a more cautious approach in their investments in our securities whether publicly

traded or not affecting investor sentiment towards us and therefore negatively impacting

our ability to raise capital in the future.Our net cash flows from operating activities is subject to fluctuation and may adversely affect

our liquidity and financial condition.We recorded net cash flows from operating activities of RMB7577.7 million RMB17405.7

million and RMB11479.8 million for the years ended 31 December 2022 2023 and 2024

respectively. Along with the expansion of the Group’s business the amount of cash paid for

purchase of goods and labour services may increase and lead to fluctuations in our results

of operations. We cannot assure you that we will not continue to experience significant

fluctuations in cash flows from operating activities. Our liquidity and financial condition

may be materially and adversely affected by the negative net cash flows and we cannot

assure you that we will have sufficient cash from other sources to fund our operations. If we

resort to other financing activities to generate additional cash we will incur financing costs

and we cannot guarantee that we will be able to obtain the financing on terms acceptable to

us or at all.We are exposed to concentration risk of reliance on major customers and customers in the

carriers’ network segment and the loss of or a significant reduction in sales to any of these

customers could adversely affect our business financial condition and results of operations.We generate a substantial portion of our revenue from a limited number of major customers

and customers in the carriers’ network segment. For the years ended 31 December 2022

2023 and 2024 revenue from our five largest customers amounted to RMB75163.7 million

RMB77598.2 million and RMB67577.7 million accounting for 61.1% 62.5% and 55.7%

of our total sales in the respective year and sales to our largest customer amounted to

RMB37132.4 million RMB34725.3 million and RMB33294.5 million accounting for

30.2% 28.0% and 27.5% of our total sales in the respective year. For the years ended 31

December 2022 2023 and 2024 revenue generated from customers in the carriers’ network

segment amounted to RMB80040.6 million RMB82758.9 million and 70326.7 million

accounting for 65.1% 66.6% and 58.0% of our operating revenue in the respective year.Despite our long-term business relationships with our major customers we cannot assure

you that we will be able to maintain our long-term collaborations with our business

partners. The formation of our business and future expansion plans is based on our

estimation of market and customer demands. However the actual demands may fall short

of our estimation due to changes in our customers’ business models strategies or financial

condition or changes in the domestic and international market conditions and economic

development among others. For example a reduction in capital expenditures by carriers in

the PRC domestic market or structural changes in the carriers market in the PRC may

reduce the demands for our products from these customers which in turn could adversely

affect our results of operation. In addition any adverse changes in our relationships or in

the key commercial arrangements with our major customers such as purchase price could

adversely affect our business financial condition and results of operations.If any of our five largest customers or major customers significantly reduces its purchase

volume or ceases to place orders with us or if we misinterpret the market demands we may

not be able to identify new customers in a timely manner and conduct our sales on

– 25 –comparable terms or seek alternative ways to make up for the decrease in sales which in

turn could have a material adverse effect on our business financial condition results of

operations and prospects.Customers’ credit risks may adversely affect our business operations.We provide one-stop communications solutions to our customers. With the rapid expansion

of our business we are serving a large customer base with differing credit status and our

business will inevitably be affected by the varied credit profiles of these customers. We seek

to mitigate the aforesaid impact mainly by identifying and managing credit risks through

the adoption of internal credit management measures such as customer credit search

customer credit rating and award customer credit limit management overall risk control

and credit control against customers with faulty payment records and by transferring credit

risks through the purchase of credit insurance and appropriate financial instruments.However there is no guarantee that our customers will settle payment in full as it falls due

or that our efforts to manage these risks will be successful. In the event our customers are

unable to settle trade amounts due to us on a timely basis this will have an adverse impact

on our results of operations cash flows and financial position.Failure to collect our trade receivables and other receivables in a timely manner may adversely

affect our liquidity.We may not be able to collect our trade receivables in a timely manner and we may face

difficulty collecting receivables for reasons beyond our control such as customers delaying

payment past the relevant credit periods granted or being unable to pay us when payments

are due. We had total trade receivables with gross carrying amount of RMB17751.4

million RMB20821.5 million and RMB21288.4 million for the years ended 31 December

2022 2023 and 2024 respectively representing 9.81% 10.36% and 10.27% of our Group’s

total assets for the same period respectively. In addition we had other receivables of

RMB1346.9 million RMB1146.4 million and 2597.6 million for the years ended 31

December 2022 2023 and 2024 respectively. Any significant delay or default in our

collection of trade receivables and other receivables may impose pressure on our cash flow

and working capital and reduce the pool of available financial resources relative to our

expectations and expenditure plans which in turn could have a material adverse effect on

our business financial condition and results of operations.We are exposed to risks in relation to the inventories the Group maintains.Our inventories include raw materials materials sub-contracted for processing

work-in-progress finished goods dispatched goods contract fulfillment cost and data

resources. We manage our inventory levels based on our forecasts of customer demand for

our services in terms of ongoing projects and potential new projects. Our inventories

amounted to RMB45235.0 million RMB41131.3 million and RMB41257.7 million as at 31

December 2022 2023 and 2024 respectively representing 25.0% 20.5% and 19.9% of our

total assets respectively.Customer demand however can be affected by numerous uncertainties. Furthermore the

rapid technological development in the telecommunications industry resulted in provision

for outdated obsolete and sluggish inventories. For the years ended 31 December 2022

2023 and 2024 our provisions for impairment of inventories were RMB4660.4 million

RMB5038.2 million and RMB5.310.0 million respectively.– 26 –If we fail to manage our inventories effectively we may be subject to a heightened risk of

inventory obsolescence a decline in the value of inventories and potential inventory

write-downs or write-offs. Procuring additional inventories may also require us to commit

substantial working capital preventing us from using such capital for other purposes. Any

of the foregoing may materially and adversely affect our results of operations and financial

condition.We may face challenges in expanding our business and operations internationally and our

ability to conduct business in international markets may be adversely affected by legal

regulatory political and economic risks.We generate a substantial portion of our operating revenue from the international market.Our operating revenue generated from markets outside of the PRC were RMB37708.1

million RMB37765.5 million and RMB39293.1 million for the years ended 31 December

2022 2023 and 2024 respectively representing 30.7% 30.4% and 32.4% of our Group’s

revenue for the same period respectively. We face challenges and risks associated with

expanding our business and operations globally into new geographic markets. New

geographic markets may have competitive conditions user preferences and technological

requirements that are more difficult to predict or satisfy than our existing markets. In

certain markets we have relatively little operating experience and may not benefit from any

first-to-market advantages or otherwise succeed.We may also face protectionist policies that could among other things hinder our ability to

execute our business strategies and put us at a competitive disadvantage relative to domestic

companies. Local companies may have a substantial competitive advantage because of their

greater understanding of and focus on the local users as well as their more established

local brand names requiring us to build brand awareness in that market. International

expansion may also require significant capital investment which could strain our resources

and adversely impact current performance while adding complexity to our current

operations. We are subject to PRC law in addition to the laws of the other regions and

countries in which we operate. If any of our overseas operations or our associates or

agents violate such laws we could become subject to sanctions or other penalties which

could negatively affect our reputation business and operating results.Furthermore the Group may be adversely affected by political geopolitical economic or

social developments in any of the countries or regions in which the Group conducts

business. For instance despite the insignificance of the Group’s business operation in

Russia which is conducted in compliance with the relevant sanction and export control

regulations that the Group is subject to the military incursion by Russia into Ukraine as

well as the series of severe economic sanctions imposed by various governments in response

may adversely impact macroeconomic conditions give rise to regional instability and result

in heightened economic sanctions from the international community in a manner and to an

extent that cause elevated levels of political unrest and market volatility. Hence while the

military incursion has not caused any material adverse impact on the Group’s results of

operations and cash flows the business financial condition and results of operations of the

Group may still be affected in ways unforeseen by the Group. Similarly the political

geopolitical economic or social developments in other countries in which the Group

conducts business may lead to implementation of protectionist policies that result in

unfavourable business environment for the Group’s operation and may even restrict the

Group’s ability to continue to operate and expand its business in such jurisdictions thereby

adversely affecting the business financial condition and results of operations of the Group.– 27 –Our business may also subject to a variety of other risks and uncertainties related to trading

in numerous other foreign countries including the imposition of any local protectionist

policies import export investment or currency restrictions including tariffs and import or

export quotas or any other relevant restrictions. The materialisation of such risks or

uncertainties could have a material adverse effect on our business results of operations and

financial position.In addition as the industry that we operate in has a high barrier of entry our reputation

business and results of operations could be materially adversely affected if we encounter

issues including but not limited to the following:. lack of acceptance of our products and services and challenges in localising our

offerings/services to appeal to local demands;. difficulties conforming our products to regulatory and safety requirements and other

telecommunication systems and/or infrastructures;. failure to attract and retain capable talents with international perspectives who can

effectively manage and operate local businesses;. challenges in identifying appropriate local business partners and establishing and

maintaining good working relationships with them;. challenges related to the availability reliability and security of international payment

systems and logistics infrastructure;. challenges in maintaining efficient and consolidated internal systems including

technology infrastructure and in achieving customisation and integration of these

systems with the other parts of our technology platform;. challenges in replicating or adapting our policies and procedures to operating

environments different from that of our present policies and procedures;. national security policies that restrict our ability to utilise technologies that are deemed

by local governmental regulators to pose a threat to their national security;. political social or economic instability in the jurisdictions that we operate;. the need for increased resources to manage regulatory compliance across our

international businesses;. compliance with privacy laws and data security laws and compliance costs across

different legal systems;. heightened restrictions and barriers on the transfer of data between different

jurisdictions;. differing complex and potentially adverse customs import/export laws tax rules and

regulations or other trade barriers or restrictions related to compliance obligations and

consequences of non-compliance and any new developments in these areas;. business licensing or certification requirements of the local markets;

– 28 –. exchange rate fluctuations;. any regulations or sanctions imposed on our customers; and. political instability and general economic or political conditions in particular countries

or regions including territorial or trade disputes war and terrorism.Failure to manage these risks and challenges could negatively affect our ability to expand

our business and operations overseas as well as materially and adversely affect our business

financial condition and results of operations.We may incur increased costs associated with compliance with laws of the differing

jurisdictions in which the Group operates in including any variation thereof.Laws and regulations in other countries vary and change over time. These laws may also be

complex or loosely defined and at times conflicting in nature intent or interpretation in

certain countries in which we operate. Many are untested in courts and can have different

interpretation and guidance even from the same regulators and enforcement of such laws

may be inconsistent. An adverse development related to any of the abovementioned factors

and other risks associated with international trade may have a material and adverse effect

on our business financial position results of operations and prospects if the Group is

unable to adapt its business strategies or operations accordingly.Should the Group be subject to any new or additional tariffs for our products or if our

customers are unwilling to continue to bear such tariffs or additional tariffs such tariffs

may reduce our price competitiveness and negatively impact our sales financial

performance cash flows and prospects. Any changes in trade policy by any of the

world’s major trading powers could trigger retaliatory actions by affected countries

resulting in “trade wars” where states increasingly raise or create tariffs.The Group maintains business and contractual relationships with customers and suppliers

across different jurisdictions. Our contracts with such customers and suppliers may

therefore be subject to the laws of the countries where such customers and suppliers are

situated within. There is no assurance that the relevant laws regulations and guidelines in

such jurisdictions will not change. In the event that there are any such changes in the

relevant laws regulations and guidelines applicable to our business such changes in the

relevant laws and regulations may impose additional obligations on top of our existing

contractual obligations or modify or change the nature of our contractual obligations with

such customers and suppliers. We may also incur additional costs for compliance with and

obtaining advice on the interpretation of such changes in the relevant laws regulations and

guidelines and on the possible effects on our contractual relationships with such customers

and suppliers in the affected jurisdictions. If we fail to comply with such amended and/or

new laws and regulations our business results of operations and financial position may be

adversely affected.We are subject to complex and evolving laws regulations and governmental policies regarding

data security privacy and personal information.In recent years data security and privacy protection has become an increasing regulatory

focus of government authorities across the world. The PRC government has enacted a series

of laws and regulations on privacy protection and data security in the past few years. When

– 29 –conducting our business we may have access to certain data of our users and therefore are

subject to the privacy and data protection laws and regulations including without

limitation the PRC Civil Code Law《( 中華人民共和國民法典》) and the PRC Cybersecurity

Law 《( 中華人民共和國網絡安全法》). Moreover different regulatory bodies in PRC have

enforced data security and privacy protections laws and regulations with various standards

and applications. The various standards in enforcement of data privacy and protection laws

may increase our operating cost as we need to spend time and resources to comply with

various such standards. Furthermore the PRC regulatory and enforcement regime with

regard to cybersecurity and data protection is still evolving. PRC regulators have been

increasingly focused on regulation in the areas of cybersecurity and data protection. The

following are examples of recent PRC regulatory activities in this area.On 20 August 2021 the State Council promulgated the PRC Personal Information

Protection Law 《( 中華人民共和國個人信息保護法》) effective from 1 November 2021. The

Personal Information Protection Law requires among others that (i) the processing of

personal information should have a clear and reasonable purpose which should be directly

related to the processing purpose in a method that has the least impact on personal rights

and interests and (ii) the collection of personal information should be limited to the

minimum scope necessary to achieve the processing purpose to avoid the excessive

collection of personal information. Entities handling personal information shall bear

responsibilities for their personal information handling activities and adopt necessary

measures to safeguard the security of the personal information they handle. Otherwise the

entities handling personal information could be ordered to rectify or suspend or terminate

the provision of services and face confiscation of illegal income fines or other penalties.On 10 June 2021 the Standing Committee of the National People’s Congress promulgated

the PRC Data Security Law《( 中華人民共和國數據安全法》). The PRC Data Security Law

among others provides for a security review procedure for the data activities that may

affect national security. On 28 December 2021 the Cyberspace Administration of China

together with other relevant administrative departments jointly promulgated the revised

Cybersecurity Review Measures 《( 網絡安全審查辦法》) with effect from 15 February 2022

according to which critical information infrastructure operators that procure internet

products and services and network platform operators engaging in data processing

activities must be subject to the cybersecurity review if their activities affect or may affect

national security. The Cybersecurity Review Measures grant the governmental authorities

the discretion to initiate a cybersecurity review on any data processing activity if they deemsuch activity affects or may affect national security. The exact scope of “critical informationinfrastructure operators” under the current regulatory regime remains unclear and the

identification of critical information infrastructure operators is subject to specific

identification rules stipulated by relevant industry regulators and the notice from the

relevant regulators pursuant to the Regulations on Protection of Critical Information

Infrastructure《( 關鍵信息基礎設施安全保護條例》). As of the date hereof no detailed rules

or guidance with respect to the implementation of such regulations has been issued by any

government authorities and the Issuer and its PRC Subsidiaries have not received anynotification determining the Issuer or its PRC Subsidiaries as “critical infrastructureinformation operator” from the relevant supervisory authorities. However the exact scope

of “critical information infrastructure operators” under the current regulatory regime

remains unclear and the PRC government authorities may have the discretion in the

interpretation and enforcement of these laws and there can be no assurance that therelevant PRC government authorities would not determine us as “critical infrastructure– 30 –information operator” in the future. In addition it is possible that we may become subject

to additional or new laws and regulations in this regard particularly to cybersecurity and

protection laws in other jurisdictions which may result in additional expenses to us and

subject us to potential liability.Furthermore on 30 September 2024 the State Council published the AdministrationRegulations on Network Data Security 《( 網絡數據安全管理條例》) (the “Data SecurityRegulations”) which provides that network data processors conduct network data

processing activities that affect or may possibly affect national security must conduct

national security review in accordance with relevant laws and regulations. The Data

Security Regulations provide no further explanation or interpretation as to how to

determine what constitutes “affecting national security.” As such there remain

uncertainties of interpretation application and enforcement of the evolving relevant laws

and regulations and future regulatory changes may impose additional restrictions.The laws and regulations regarding data security and privacy protection in the PRC as well

as other countries are generally complex and evolving with uncertainty as to the

interpretation and application thereof. As such we cannot assure you that our privacy and

data protection measures are and will be always considered sufficient under applicable

laws and regulations. Additionally the integrity of our privacy and data protection

measures is also subject to system failure interruption inadequacy security breaches or

cyber-attacks. If we are unable to comply with the then applicable laws and regulations or

to address any data security and privacy protection concerns such actual or alleged failure

could damage our reputation deter current and potential customers from using our

solutions and could subject us to significant legal financial and operational consequences.Our financial condition and results of operations may be affected by material fluctuations of

interest rates.The interest rate risk of the Group is mainly associated with interest-bearing liabilities. As

at 31 December 2024 the Group’s total interest-bearing liabilities amounted to

RMB58071.7 million representing 28.0 per cent. of the Group’s total assets. The Group

seeks to lower its interest rate risk mainly through control over the total amount and

structured management of its interest-bearing liabilities. The total amount of

interest-bearing liabilities is matched with the funding requirements of the Group’s

operational development. Control over the total amount of interest-bearing liabilities is

mainly achieved by improving the cash turnover efficiency and increasing the free cash flow

of the Group. Structured management of interest-bearing liabilities is achieved mainly by

way of comprehensive control of interest rate risks through a mixed portfolio of

long-term/short-term domestic and overseas loans denominated in RMB or foreign

currencies with fixed or floating interests complemented by derivative instruments such

as interest rate swaps sought from a diverse range of low-cost financing channels in the

global market taking into account the trends of market changes. Fluctuations in the interest

rates of our interest-bearing liabilities in RMB or foreign currencies will result in changes in

the total amount of interest payable by the Group and could therefore adversely affect our

business financial condition and results of operations.– 31 –Foreign currency exchange rate fluctuations may have a material adverse effect on our results

of operations.The Group’s consolidated financial statements are expressed in RMB. The exchange rate

risk of the Group arises mainly from foreign exchange exposures associated with the sales

purchases and financing settled in currencies other than RMB and the volatility of exchange

rates which could have an adverse effect on our business financial condition results of

operations and prospects.We adopt ongoing measures to strengthen foreign exchange risk management covering the

entire business process and seeks to minimize exposures through various. Based on the risk

exposure of monetary assets and liabilities and estimates of future foreign currency income

and expenditure we adopt forward exchange contracts to offset exchange rate risks. We

also conduct hedging transactions in respect of exchange rate risk exposure according to

annual caps for foreign exchange derivative trades approved and authorised by the Board

and the General Meeting. The derivative trades of our Group are centrally managed by the

Group’s derivative investment committee which will adjust the foreign exchange hedging

strategy according to market movements. In addition a derivative investment work group

has been established under the said committee to be in charge of specific transactions. We

have also strengthened liquidity risk management in countries with foreign exchange

difficulties and endeavoured to facilitate RMB pricing and settlement for overseas projects

to lower its exchange risks in the long term. We cannot assure that our efforts in managing

exchange rate risks will be effective and which in turn could adversely affect our business

financial condition and results of operations.We may not be able to adequately protect our intellectual property rights which could

adversely affect our business operations.In the course of our business we rely on certain intellectual property rights such as patents

and trademarks. Our success depends in part on our ability to obtain maintain and defend

our intellectual property rights. We have always attached great importance to product

technology research and development as well as the protection and management of

intellectual property rights. Trademarks of the Group’s products and services “ZTE” or

“ZTE中興” are all protected by trademark registration and intellectual property right

protection in various forms including but not limited to application for patent right or

copyright has been adopted wherever possible in respect of such products and services.While we have adopted highly stringent measures to protect our intellectual property rights

potential disputes over intellectual property rights between the Group and other

telecommunications equipment manufacturers franchisee companies and carriers under

partnerships with the Group cannot be entirely avoided. Furthermore there can be no

assurance that pending patent applications will result in issued patents that future patent

applications will be issued that patents issued to or licensed by us will not be challenged or

circumvented by competitors or that such patents will be found to be valid or sufficiently

broad to protect our technologies or to provide us with a competitive advantage. The

coverage of patents is subject to interpretation by the courts and such interpretation is not

always uniform or predictable.– 32 –In the event that the measures taken by the Group and the protection afforded by law do

not adequately safeguard the Group’s proprietary technology or property we could suffer

significant losses due to the sales of competing products or services that appoints the

Group’s intellectual property which in turn could adversely affect the Group’s business

financial condition and results of operations.We face risk associated with our investments including the exposure of fair value changes for

our financial assets at fair value through profit or loss and valuation uncertainty.Subject to fulfilment of our day-to-day working capital requirements we have utilised our

internal funds to invest in wealth management products and may from time to time invest

in such products in the future. As of 31 December 2024 the balance of the outstanding

financial products purchased by the Group amounted to RMB13687.0 million

representing 6.6% of our total assets. We are exposed to credit risk in relation to such

investments which may adversely affect the net changes in their fair value. Our investments

may earn yields substantially lower than anticipated and the fair values of our investments

may fluctuate significantly which contribute to the uncertainties in valuation. The financial

products at fair value through profit or loss are stated at fair value and net changes in their

fair value are recorded under net other gains/(losses) and therefore directly affect our

results of operations. If we record fair value losses our financial condition results of

operations and prospects may be adversely affected.We use significant unobservable inputs such as the expected yield of the underlying

investment portfolio and discount rate in valuing such financial assets. Accordingly such

determinations require us to make significant estimates which may be subject to material

changes. Factors beyond our control can significantly influence and cause adverse changes

to the estimates and thereby affect the fair value. These factors include but are not limited

to general economic conditions changes in market interest rates and stability of the capital

markets. The valuation may involve a significant degree of judgment and assumptions

which are inherently uncertain and may result in material adjustments which in turn may

materially and adversely affect our results of operations.The Audited Financial Statements have been prepared and presented in accordance with PRC

GAAP which are different from IFRS in certain respects.The Audited Financial Statements have been prepared and presented in accordance withPRC GAAP. PRC GAAP differs in certain material respects from IFRS. See “Summary ofCertain Differences between PRC GAAP and IFRS” for further information. Each investor

should consult its own professional advisers for an understanding of the differences between

PRC GAAP and IFRS and/or between PRC GAAP and other generally accepted

accounting principles as well as how those differences might affect the financial

information contained herein.Potential investors should not place reliance on financial information which is not audited or

reviewed.The Group may publish annual semi-annual and/or quarterly consolidated financial

information to satisfy its continuing disclosure obligations relating to its securities listed on

the stock exchanges in other jurisdictions according to the applicable regulations and rules

of such stock exchanges. Some of these financial information may not be audited or

reviewed by the Group’s independent auditors and should not be relied upon by investors to

– 33 –provide the same quality of information associated with information that has been subject

to an audit or a review. Such unaudited or unreviewed consolidated interim financial

information is not necessarily indicative of the results that may be expected for the full

financial year or any period thereafter. Consequently potential investors should not take

such financial information as indicative of the expected financial condition or results of

operations of the Issuer or the Group for the relevant full financial year. Potential investors

should exercise caution when using such data to evaluate the Issuer’s or the Group’s

financial condition and results of operations.We may seek to obtain future financing through the issuance of debt or equity which may have

an adverse effect on our shareholders or may otherwise adversely affect our business.If we raise funds through the issuance of additional equity or debt including convertible

debt or debt secured by some or all our assets holders of any debt securities or preferred

shares issued will have rights preferences and privileges senior to those of holders of our

Shares in the event of liquidation. If additional debt is issued there is a possibility that once

all senior claims are settled there may be no assets remaining to pay out to the holders of

Shares. In addition if we raise funds through the issuance of additional equity whether

through private placements or public offerings such an issuance would dilute the interests

of our current shareholders that do not participate in the issuance. If we are unable to

obtain any needed additional funding we may be required to reduce the scope of delay or

eliminate some or all of our planned research development manufacturing and marketing

activities any of which could materially and adversely affect our business.Furthermore the terms of any debt securities we may issue in the future may impose

restrictions on our operations which may include limiting our ability to incur additional

indebtedness pay dividends on or repurchase our share capital or make certain

acquisitions or investments or otherwise restrict our freedom to operate our business by

requiring lenders’ consent for certain corporate actions. In addition we may be subject to

covenants requiring us to satisfy certain financial tests and ratios and our ability to satisfy

such covenants may be affected by events outside of our control. There is no assurance that

we will be able to obtain additional financing on terms that are favourable and acceptable.If we are not able to secure adequate financing our business and growth may be negatively

affected.We may be affected by the cost and impact of future disputes and/or litigation.We are from time to time susceptible to claims and various legal and administrative

proceedings in the ordinary course of our business. Litigation arising from any failure

injury or damage from the Group’s operations may result in the relevant member of the

Group being named as defendant in lawsuits asserting large claims against such member of

the Group or subject such member of the Group to significant regulatory penalties. The

Group may also be subject to inquiries investigations and proceedings by regulatory and

other governmental agencies in the ordinary course of its business. These risks are often

difficult to assess or quantify and their existence and magnitude often remain unknown for

a substantial period of time. Actions brought against the Group may result in settlements

injunctions fines penalties or other sanctions adverse to the Group’s reputation financial

condition and results of operations. Even if the Group is successful in defending against

these actions the costs associated with the Group’s defence may be significant. When the

market experiences a downturn the number of legal claims and amount of damages sought

in litigations and regulatory proceedings may increase. A significant judgment arbitration

– 34 –award or regulatory action against the Group or a disruption in the Group’s business

arising from adverse adjudications in proceedings against the Group’s directors senior

management or key employees would materially and adversely affect the Group’s liquidity

business financial condition reputation results of operations and prospects.There may be an adverse impact on our business as a result of a loss of business reputation or

negative publicity.We operate in an environment where integrity and the trust of clients are of utmost

importance. Therefore it is vulnerable to negative market perceptions. Negative publicity

associated with us our officers or employees in particular adverse media coverage relating

to allegations of fraudulent or illegal activities associated with our officers or employees or

the occurrence of any of the risks set out in this section could result in loss of clients. Since

our business operations depend to a large extent on our officers and employees the actions

misconduct omissions failures or breaches of any of such officers or employees and/or

service providers may by association create negative publicity on the Group. Accordingly

any mismanagement fraud or failure to discharge legal contractual regulatory or fiduciary

duties responsibilities liabilities or obligations or the negative perception resulting from

such activities or any allegation of such activities could have a material adverse effect on

the Group’s business growth prospects net inflows of asset under management fee income

financial condition and results of operations.Failure to detect or prevent fraudulent or illegal activities or other misconduct by our

employees representatives agents customers suppliers or other business partners may

materially and adversely affect our business.We are exposed to risks of fraudulent or illegal activities or other misconduct by our

employees representatives agent customers suppliers or other business partners in the

course of our business operations. Such misconduct could include fraud corruption

bribery collusion or other violations of applicable laws including anti-corruption and

anti-bribery laws which could expose us to liabilities fines and penalties imposed by

government authorities as well as significant reputational damage. We cannot assure you

that our measures in place to monitor and prevent such misconduct would be effective at all

times in identifying or mitigating all potential risks. Instances of misconduct may still

occur and any undetected or unresolved incidents could lead to adverse consequences such

as financial losses legal liabilities or disruptions to our operations.Furthermore any publicised instances including adverse media coverage and allegations

of fraudulent or illegal activities associated with our employees representatives agents or

business partners could harm our reputation reducing customer and partner trust in our

business. If such misconduct involves our employees we could also face liabilities to third

parties and penalties imposed by authorities. Accordingly any failure to detect and prevent

fraudulent or illegal activities or other misconduct by our employees customers suppliers

or other business partners could materially and adversely affect our business financial

condition and results of operations.– 35 –Our risk management and internal control systems may not be adequate or effective.We have established risk management and internal control systems in relation to our

operations. However due to the inherent limitations in the design and implementation of

risk management and internal control systems including the identification and evaluation

of risks internal control variables and the communication of information we cannot assure

you that such systems will be able to identify mitigate and manage all our exposure to risks.Our risk management and internal controls also depend on the proficiency of and

implementation by our employees. We cannot assure you that such implementation will not

involve any human error or mistakes which may materially and adversely affect our

business financial condition and results of operations.Our operations rely on complex information technology systems and networks and our

business and reputation may be impacted by information technology system failures network

disruptions or cybersecurity breaches.We rely extensively on information technology systems to manage and operate our business

some of which are supported by third party vendors including cloud-based systems and

managed service providers. If these systems fail to function properly experience security

breaches or disruptions or do not provide the anticipated benefits our ability to manage

our operations could be impaired which could have a material adverse impact on our

results of operations and financial condition.We may be subject to information technology system failures or network disruptions caused

by natural disasters accidents power disruptions telecommunications failures acts of

terrorism or war computer viruses physical or electronic break-ins or other events or

disruptions. System redundancy and other continuity measures may be ineffective or

inadequate and our business continuity and disaster recovery planning may not be

sufficient for all eventualities. Such failures or disruptions could adversely impact our

business by among other things preventing access to our internet services interfering with

customer transactions or impeding the assembling and shipping of our products. These

events could materially and adversely affect our reputation financial condition and

operating results.Our information technology systems may be subject to computer viruses or other malicious

codes unauthorised access attempts phishing and other cyberattacks. We continue to

assess potential threats and make investments seeking to address and prevent these threats

including monitoring and upgrading our networks and systems and conducting employee

trainings. However because the techniques used in these cyberattacks change frequently

and may be difficult to detect for periods of time we may face difficulties in anticipating

and implementing adequate preventative measures. To date we have not been materially

affected by cyberattacks; however we cannot guarantee that our security efforts will

prevent breaches or breakdowns to our databases or systems. If the information technology

systems networks or service providers we rely upon fail to function properly or if we suffer

a loss significant unavailability of or disclosure of our business or stakeholder information

and our business continuity plans do not effectively address these failures on a timely basis

we may be exposed to reputational competitive and business harm as well as litigation and

regulatory action including administrative fines. The costs and operational consequences

of responding to breaches and implementing remediation measures could be significant.– 36 –Our insurance coverage may not be sufficient to cover all losses or potential claims by our

customers which would affect our business results of operations and financial condition.We have maintained insurance coverage which includes mandatory social insurance and

director liability insurance. While our directors are of the view that the amount of our

insurance coverage is in line with the industry practice and is adequate for our operations it

may not be adequate to fully compensate for all kinds of losses we may suffer in the future.In addition our insurers will review our policies every year and we cannot guarantee that

our policies can be renewed on similar or other acceptable terms or at all. Furthermore if

we suffer unexpected severe losses or losses that far exceed the policy limits it could

materially and adversely affect our business results of operations financial condition and

prospects.Our business may be impacted by political events war terrorism public health issues natural

disasters and other business interruptions.War terrorism geopolitical uncertainties public health issues and other business

interruptions could cause damage or disruption to international commerce and the global

economy and thus could have a material adverse effect on us our customers and suppliers.Our business operations are subject to interruption by among others natural disasters

whether as a result of climate change or otherwise fire power shortages and other

industrial accidents terrorist attacks and other hostile acts labor disputes public health

issues demonstrations or strikes and other events beyond our control. Such events could

decrease demand for our products make it difficult or impossible for us to make and deliver

products to our customers or to receive materials from our suppliers and create delays and

inefficiencies in our supply chain. In the event of a natural disaster or major public health

issue we could incur significant losses require substantial recovery time and experience

significant expenditures in order to resume operations.Our business may be adversely affected by the uncertain global economic outlook.Our Group’s business financial condition results of operations profitability and prospects

may be affected by general global economic conditions. The outlook for the global economy

and financial markets remains uncertain. In particular:. A number of major economies in the world including Europe the United States

Japan and the PRC are experiencing uncertainty in economy outlook due to lower

global economic growth prospects higher government fiscal deficits and public debt

and continued inflationary pressure. Furthermore the rise in commodity prices has

played a pivotal role in amplifying the inflationary pressure. High commodity prices

and other trade barriers driven by various factors including trade tariff disputes

supply chain disruptions and efforts to localise supply chains increased demand and

geopolitical uncertainties have resulted in higher costs for goods and raw materials

which in turn have escalated the cost of living and production.. Escalating tension between the United States and the PRC in recent years over trade

policies including tariffs and barriers on imports and exports and government

incentives to onshore and/or nearshore production and supply chains to favoured

jurisdictions could significantly undermine the stability of the global economies. Both

countries have implemented tariffs and other barriers on certain industries and

products from the other casting uncertainty over tariffs and barrier to entry for

– 37 –products on both sides. There are uncertainties as to when and whether the trade

disputes will be resolved and the trade barriers lifted. The trade dispute between the

United States and China has resulted in disruption to global trade flows global

production and supply chains; and it also increased volatility in the financial markets

around the world. In addition the European Union (“EU”)-China relations have

become increasingly complex with bilateral relations marked by challenges related to

market access and investment as well as key foreign and security policy issues.. The prolonged military conflict between Russia and Ukraine has further resulted in an

escalated regional instability and amplified the tensions between international

relationships as well as adversely affected global economic conditions and the

sanctions imposed by various countries on Russia continue to pose adverse effects on

global economy. The sanctions imposed by various countries on Russia has also

resulted in increased commodity and food costs which affects the global economy

adversely. Moreover the ongoing conflict in Israel Iran and Gaza has increased the

risk of destabilisation of the Middle East region which has led to further military

conflicts between the United States Israel and Iran and the situation remains highly

volatile and uncertain.. Persistent high interest rates pose substantial risks to the global economy and financial

markets potentially leading to a slowdown in economic growth as borrowing costs rise

for both consumers and businesses. These elevated rates can also trigger increased

volatility in financial markets with noticeable price fluctuations in stocks bonds and

other financial instruments. If these high rates are sustained the consequent reduction

in investment and consumer spending could heighten the risk of a global recession

adversely affecting overall economic stability. Although certain global central banks

have recently decided to lower their local interest rates based on their latest outlook on

inflation and other key economic indicators there is no guarantee that further

increases will not occur.Accordingly these situations could potentially present risks to our Group. Given the

uncertainties as to the future economic outlook we cannot give any assurance that we will

be able to maintain or continue to grow our revenue and profits or that we will be able to

react promptly to any change in economic conditions. In the event that we fail to react

promptly to the changing economic conditions our performance and profitability could be

adversely affected.RISKS RELATING TO DOING BUSINESS IN THE PRC

Economic and social conditions in the PRC and government policies could affect the Group’s

business and prospects.A substantial majority of the Group’s businesses assets and operations are located in the

PRC. Accordingly the Group’s business prospects financial condition and results of

operations are to a significant degree subject to the economic and legal developments in

the PRC. For the past few decades the PRC government has implemented various

economic reform measures to utilise market forces in the development of the PRC economy.In addition the PRC government continues to play a significant role in regulating certain

industries and the economy through numerous policy measures. The Group cannot predict

whether changes in the nation’s economic or social conditions or in any laws regulations

and policies will adversely affect its business financial condition or results of operations.– 38 –In addition many of the economic reforms carried out by the PRC government are

unprecedented or experimental and are expected to be refined and improved over time.Other economic and social factors may also lead to further adjustments of the reform

measures. This refining and adjustment process may not necessarily have a positive effect

on the Group’s operations and business development.Bondholders shall pay attention to the characteristics of the PRC legal system.The Group is subject to laws and regulations of the PRC. The PRC legal system is based on

written statutes. However since some of the current laws and regulations are relatively new

and the PRC legal system continues to rapidly evolve the enforcement of these laws

regulations and rules may also be evolving. These characteristics relating to the PRC laws

and regulations may impede the Group’s ability to enforce contracts that the Group has

entered into with its investors creditors customers suppliers and business partners. The

Group cannot predict the effect of future developments in the PRC legal system or the

integration of such developments under the legal systems of other jurisdictions. This shall

be taken into consideration when seeking legal protections available to or against the

Group.Changes in PRC laws and regulations on labor and employee benefits may adversely affect our

business and results of operations and substantially increase our labor-related costs.As a substantial portion of our business is conducted through our subsidiaries in China we

are subject to PRC laws and regulations on labor and employee benefits. In recent years the

PRC government has implemented policies to strengthen the protection of employees and

obligate employers to provide more benefits to their employees. The PRC Employment

Contract Law and the Implementation Regulations of the Employment Contract Law both

of which became effective in 2008 require more benefits to be provided to employees such

as compensation for termination of employment contracts. In addition the Employment

Contract Law and the Implementation Regulations of the Employment Contract Law

contain provisions that are more favorable to employees than the prior labor laws and

regulations in China. For example an employer is obligated to compensate an employee if

the employer decides not to renew an existing employment contract unless the employee

refuses the employer’s offer to renew the expiring employment contract with the same or

better terms. In addition an employer is obligated to provide an open-ended employment

contract after an employee has completed two consecutive terms of fixed-term employment

under which the employer will be liable to pay damages to an employee if the employer

terminates the employment without cause until the employee reaches an age at which he or

she is eligible for pension payment. As a result of the Employment Contract Law and the

Implementation Regulations of the Employment Contract Law we may have greater

difficulty terminating under-performing employees and may incur higher levels of labor

costs in order to comply with the provisions of the new law and regulation which may

adversely affect our business financial condition and operating results.Our operations are subject to and may be affected by changes in PRC tax laws and regulations

We are subject to periodic examinations on fulfillment of our tax obligation under the PRC

tax laws and regulations by PRC tax authorities. Although we believe that in the past we

had acted in compliance with the requirements under the relevant PRC tax laws and

regulations in all material aspects and had established effective internal control measures in

relation to accounting regularities we cannot assure you that future examinations by PRC

– 39 –tax authorities would not result in fines other penalties or actions that could adversely

affect our business financial condition and results of operations as well as our reputation.Furthermore the PRC government from time to time adjusts or changes its tax laws and

regulations. For example under the Individual Income Tax Law (“IIT Law”) which was last

amended on 31 August 2018 and its implementation rules foreign nationals have no

domicile in China but have resided in the PRC for a total of 183 days or more in a tax year

would be subject to PRC individual income tax on such income gained within or outside the

PRC as wages salaries remuneration for labor service. Upon such change of rules our

ability to attract and retain highly skilled foreign scientists and research technicians to work

in China may be materially affected which may in turn have a material adverse effect on

our business financial condition results of operations cash flows and prospects. Further

adjustments or changes to PRC tax laws or regulations together with any uncertainty

resulting therefrom could also have an adverse effect on our business financial condition

and results of operations.There is no assurance that one is able to effect service of process upon or to enforce against

the Issuer or its directors or members of its senior management who reside in the PRC in

connection with judgments obtained in non-PRC courts.A substantial portion of the Group’s assets and the Group’s members are located in the

PRC. In addition substantially all of the assets of the Issuer’s directors and the members of

its senior management may be located within the PRC. Therefore there can be no assurance

for investors to effect service of process upon the Issuer or its directors or members of its

senior management inside the PRC in connection with judgements obtained in non-PRC

courts. On 14 July 2006 Hong Kong and the PRC entered into the Arrangement on

Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters

by the Courts of the Mainland and of the Hong Kong Special Administrative Region

Pursuant to Choice of Court Agreements Between Parties Concerned (關於內地與香港特別行政區法院相互認可和執行當事人協議管轄的民商事案件判決的安排) (the “Choice of CourtArrangement”) which took effect on 1 August 2008 pursuant to which a party with a final

court judgment rendered by a Hong Kong court requiring payment of money in a civil and

commercial case according to a “choice of court” agreement in writing may apply for

recognition and enforcement of the judgment in the PRC. Similarly a party with a final

court judgment rendered by a PRC court requiring payment of money in a civil and

commercial case pursuant to a “choice of court” agreement in writing may apply for

recognition and enforcement of such judgment in Hong Kong. A “choice of court”

agreement in writing is defined as any agreement in writing entered into between parties

after the effective date of the Choice of Court Arrangement in which a Hong Kong court or

a PRC court is expressly designated as the court having sole jurisdiction for resolving the

dispute. Therefore it is not possible to enforce a judgment rendered by a Hong Kong court

in the PRC if the parties in dispute do not enter into a “choice of court” agreement in

writing. As a result it may be difficult or impossible for investors to effect service of process

against the Issuer or its directors or members of its senior management in the PRC and/or

seek recognition and enforcement for foreign judgments in the PRC. On 18 January 2019

Hong Kong and the PRC entered into the Arrangement on Reciprocal Recognition and

Enforcement of Judgements in Civil and Commercial Matters between the Courts of the

Mainland and of the Hong Kong Special Administrative Region (關於內地與香港特別行政

區法院相互認可和執行民商事案件判決的安排) (the “2019 Arrangement”) which seeks to

establish a bilateral legal mechanism with greater clarity and certainty for recognition and

enforcement of judgements in a wider range of civil and commercial matters between the

– 40 –courts of Hong Kong and the PRC. The 2019 Arrangement has been implemented in Hong

Kong by the Mainland Judgments in Civil and Commercial Matters (Reciprocal

Enforcement) Ordinance (Cap. 645) which came into operation on 29 January 2024. In

Mainland China the Supreme People’s Court promulgated a judicial interpretation to

implement the 2019 Arrangement on 25 January 2024 (the “Judicial Interpretation”). The

2019 Arrangement applies to judgments made on or after 29 January 2024. Under the 2019

Arrangement where the Hong Kong court has given a legally effective judgment in a civil

and commercial matter any party concerned may apply to the relevant People’s Court of

the Mainland China for recognition and enforcement of the judgment subject to the

provisions limits procedures and other terms and requirements of the 2019 Arrangement

and the Judicial Interpretation. The recognition and enforcement of a Hong Kong court

judgment could be refused if the relevant People’s Court of the Mainland China consider

that the enforcement of such judgment is contrary to the basic principles of the PRC law or

the social and public interests of the Mainland China. As a result there can be no assurance

that a Hong Kong court judgment will be recognised and enforced by the relevant PRC

court.Furthermore the PRC does not have treaties or agreements providing for the reciprocal

recognition and enforcement of judgments awarded by courts of the United States the

United Kingdom or most other European countries or Japan. Hence there can be no

assurance that the recognition and enforcement in the PRC of judgment of a court in any of

these jurisdictions in relation to any matter not subject to a binding arbitration provision.The Group is subject to regulations on the remittance of Renminbi into and out of the PRC

and may be affected by the risks relating to fluctuations in exchange rates in the future.The PRC government imposes regulations on the convertibility of Renminbi into foreign

currencies and the remittance of currency out of PRC. A substantial portion of the Group’s

operating income is denominated in Renminbi a portion of which may need to be converted

into other currencies in order to meet the Group’s foreign currency obligations if any.Under the existing PRC laws and regulations on foreign exchange payments of current

account items including profit distributions interest payments and trade and

service-related foreign exchange transactions can be made in foreign currencies without

prior approval from SAFE provided that certain procedural requirements are complied

with. Approval from or registration with competent government authorities is required

where Renminbi is to be converted into foreign currency and remitted out of the PRC to

pay capital expenses such as the repayment of loans denominated in foreign currencies. The

PRC government may at its discretion take measures to regulate foreign currencies

exchanges for current account and capital account transactions under certain

circumstances. If the foreign exchange regulations prevent the Group from obtaining

sufficient foreign currencies to satisfy the Group’s foreign currency demands if any. In

addition there can be no assurance that new laws or regulations will not be promulgated in

the future that would have the effect of remittance of Renminbi into or out of the PRC.As a result any appreciation of Renminbi against any foreign currencies may result in the

decrease in the value of the Group’s foreign currency-denominated assets. Conversely any

depreciation of Renminbi may adversely affect the Group’s ability to service liabilities

denominated in foreign currencies.– 41 –RISKS RELATING TO THE BONDS THE SHARES AND THE OFFERING

The Bonds will be effectively subordinated to all of the Issuer’s secured debt.The Bonds are senior unsecured obligations. The Bonds will be effectively subordinated to

all the Issuer’s secured indebtedness to the extent of the value of the assets securing such

indebtedness. In addition the Bonds will subject to some limitations permit the Issuer to

incur additional secured indebtedness in connection with bank and other financing

arrangements.In the event of bankruptcy liquidation reorganisation or other winding-up the Issuer’s

assets that secure the Issuer’s secured indebtedness will be available to pay obligations on

the Bonds only after all secured indebtedness together with accrued interest has been

repaid. If the Issuer is unable to repay its secured indebtedness the lenders could foreclose

on substantially all the Issuer’s assets which serve as collateral. Under such circumstances

the Issuer’s secured lenders would be entitled to be repaid in full from the proceeds of the

liquidation of those assets before those assets would be available for distribution to other

creditors including holders of the Bonds. Holders of the Bonds will participate in the

proceeds of the liquidation of the Issuer’s remaining assets ratably with holders of the

Issuer’s unsecured indebtedness that is deemed to be of the same class as the Bonds and

potentially with all of the Issuer’s other general creditors.Claims by holders of the Bonds are structurally subordinated to creditors of the Issuer’s

subsidiaries.The Issuer’s ability to make payments in respect of the Bonds depends largely upon the

receipt of dividends distributions interest of advances from its subsidiaries. The ability of

the Issuer’s subsidiaries to pay dividends and other amounts to the Issuer may be subject to

such subsidiaries’ profitability and applicable laws. Payments under the Bonds are

structurally subordinated to all existing and future liabilities and obligations of each of

the Issuer’s subsidiaries. Claims of creditors of such companies will have priority as to the

assets of such companies over the Issuer and its creditors including holders of the Bonds.There may not be a liquid market for the Bonds and Bondholders may not be able to sell their

Bonds at an attractive price or at all.The Bonds are a new issue of securities for which there is currently no trading market.Although application will be made to the Hong Kong Stock Exchange for the listing of

and permission to deal in the Bonds the Issuer cannot assure investors as to the liquidity of

the Bonds that an active trading market will develop or that the Issuer will be able to

maintain a listing of the Bonds on the Hong Kong Stock Exchange. If such a market were to

develop the Bonds could trade at prices that may be higher or lower than the initial price

depending on many factors including but not limited to the prevailing interest rates the

Issuer’s operating and financial results and the market for similar securities. The Lead

Managers are not obligated to make a market in the Bonds and any such market making if

commenced may be discontinued at any time at the sole discretion of the Lead Managers.Accordingly there is no assurance that a liquid trading market for the Bonds will develop

or be sustained. If an active trading market for the Bonds does not develop or is not

sustained the market price and liquidity of the Bonds may be adversely affected.– 42 –Even if an active trading market were to develop the Bonds could trade at prices that might

be lower than the initial offering price. Future trading prices of the Bonds will depend on

many factors including but not limited to:. the market price of the Shares;. prevailing interest rates and interest rate volatility;. the market for similar securities;. the Issuer’s operating and financial results;. the publication of earnings estimates or other research reports and speculation in the

press or the investment community;. the market price of the Bonds; or. changes in the Group’s industry and competition; and general market and economic

conditions.Accordingly Bondholders may not be able to sell their Bonds at an attractive price or at all

and may incur losses on their investments.The Trustee may request the Bondholders to provide an indemnity and/or security and/or

prefunding to its satisfaction.In certain circumstances including giving of notice to the Group pursuant to Condition 14

of the Terms and Conditions (Indemnification of the Trustee) the Trustee may request

Bondholders to provide an indemnity and/or security and/or prefunding to its satisfaction

before it takes steps and/or actions and/or institutes proceedings on behalf of Bondholders.The Trustee shall not be obliged to take any such steps and/or actions and/or institute any

such proceedings if it is not indemnified and/or secured and/or prefunded to its satisfaction.Negotiating and agreeing to an indemnity and/or security and/or prefunding can be a

lengthy process and may affect when such steps and/or actions can be taken and/or when

such proceedings can be instituted. The Trustee may not be able to take steps and/or actions

and/or institute proceedings notwithstanding the provision of an indemnity and/or security

and/or prefunding to it in breach of the terms of the Trust Deed and in circumstances

where there is uncertainty or dispute as to the applicable laws or regulations and to the

extent permitted by the agreements and the applicable law it will be for the Bondholders to

take such steps and/or actions and/or institute such proceedings directly.Bondholders will have no rights as holders of the H Shares prior to conversion of the Bonds

but are subject to changes made with respect to the H Shares.Unless and until the Bondholders acquire the H Shares upon conversion of the Bonds

Bondholders will have no rights with respect to the H Shares including any voting rights or

rights to receive any regular dividends or other distributions with respect to the H Shares.Upon conversion of the Bonds these holders will be entitled to exercise the rights of holders

of the H Shares only as to actions for which the applicable record date occurs after the date

of conversion. However such Bondholders are subject to all changes affecting the H Shares.For example in the event that an amendment is proposed to the Issuer’s articles requiring

shareholder approval and the record date for determining the shareholders of record

– 43 –entitled to vote on the amendment occurs prior to the date of conversion of the Bonds for

such Shares and (as applicable) the date of registration by the relevant Bondholder as the

holder thereof that Bondholder would not be entitled to vote on the amendment but would

nevertheless be subject to any resulting changes in the powers preferences or special rights

that affect the Shares after conversion.There is a limited period during which the Bondholders may convert their Bonds.Subject as provided in the Terms and Conditions Conversion Rights under the Terms and

Conditions may only be exercised in certain limited circumstances (subject to any applicable

fiscal or other laws or regulations and as further provided in the Terms and Conditions) at

any time on or after the 41st day after the Issue Date until the earlier of (a) the close of

business (at the place where the Certificate evidencing such Bond is deposited for

conversion) on the date falling seven working days prior to the Maturity Date; or (b) if the

Bonds shall have been called for redemption by the Issuer before the Maturity Date up to

and including the close of business (at the place aforesaid) on a date no later than seven

working days (at the place aforesaid) prior to the date fixed for redemption. If the

Conversion Rights are not exercised by Bondholders during the Conversion Period the

Bonds will be redeemed at the U.S. Dollar Equivalent of its outstanding principal amount

on the Maturity Date unless the Bonds are previously redeemed converted or purchased

and canceled in accordance with the Terms and Conditions.Securities law restrictions on the resale and conversion of the Bonds and the resale of the H

Shares issuable upon their conversion may limit Bondholders’ ability to sell the Bonds in the

United States.The Bonds and the H Shares into which the Bonds are convertible have not been and will

not be registered under the Securities Act any state securities laws or the securities laws of

any other jurisdiction. Unless and until they are registered the Bonds and the H Shares

issuable upon conversion may not be offered sold or resold except pursuant to an

exemption from registration under the Securities Act and applicable state laws or in a

transaction not subject to such laws. The Bonds are being offered and sold outside the U.S.in reliance on Regulation S under the Securities Act. The Issuer is not required to register

the Bonds and the H Shares into which the Bonds are convertible under the terms of the

Bonds. Hence future resales of the Bonds and the H Shares into which the Bonds are

convertible may only be made pursuant to an exemption from registration under the

Securities Act and applicable state laws or in a transaction not subject to such laws.The Issuer will follow the applicable corporate disclosure standards for debt securities listed on

the Hong Kong Stock Exchange which may be different from those applicable to companies in

certain other countries.The Issuer will be subject to reporting obligations in respect of the Bonds to be listed on the

Hong Kong Stock Exchange. The disclosure standards imposed by the Hong Kong Stock

Exchange may be different from those imposed by securities exchanges in other countries or

regions. As a result the level of information that is available may not correspond to what

investors in the Bonds are accustomed to or may expect.– 44 –The Bondholders may be subject to tax on their income or gain from the Bonds.Prospective investors of the Bonds are advised to consult their own tax advisers concerning

the overall tax consequences of the acquisition ownership or disposition (including upon

conversion of the Bonds) of the Bonds or the Shares. (See “Taxation” for certain PRC and

Hong Kong tax consequences.).If the Issuer or any of its subsidiaries is unable to comply with the restrictions and covenants in

its debt agreements there could be a default under the terms of these agreements which could

cause repayment of its debt to be accelerated.If the Issuer or any of its subsidiaries is unable to comply with the restrictions and

covenants or its current or future debt obligations and other agreements there could be a

default under the terms of these agreements. In the event of a default under these

agreements the holders of the debt could terminate their commitments to lend accelerate

repayment of the debt and declare all outstanding amounts due and payable or terminate

the agreements as the case may be. As a result a default under one debt agreement may

cause the acceleration of repayment of not only such debt but also other debt including the

Bonds or result in a default under the Issuer’s or such subsidiary’s other debt agreements.If any of these events occurs there is no assurance that the Issuer will have sufficient assets

and cash flow to repay in full all of its indebtedness or that the Issuer would be able to find

alternative financing. Even if the Issuer could obtain alternative financing it cannot

guarantee that it would be on terms that are favorable or acceptable to the Issuer.The Issuer may not have the ability to redeem the Bonds.Bondholders may require the Issuer subject to certain conditions to redeem for cash some

or all of their Bonds upon a transaction or event constituting a Relevant Event as describedunder “Terms and Conditions of the Bonds — Redemption Purchase and Cancellation —Redemption at the Option of the Bondholders” and “Terms and Conditions of the Bonds —Redemption Purchase and Cancellation — Redemption for Relevant Events”. The Issuer may

not have sufficient funds or other financial resources to make the required redemption in

cash at such time or the ability to arrange necessary financing on acceptable terms or at all.The Issuer’s ability to redeem the Bonds in such event may also be limited by the terms of

other debt instruments. Failure to repay repurchase or redeem tendered Bonds by the

Issuer would constitute an event of default under the Bonds which may also constitute a

default under the terms of other indebtedness held by the Issuer.The Bonds may be redeemed at the option of the Issuer which may adversely affect the trading

price and liquidity of the Bonds and may subject Bondholders to reinvestment risks.Subject to certain conditions the Bonds may be redeemed at the Issuer’s option at any time

if the aggregate principal amount of the Bonds outstanding is less than 10 per cent. of the

aggregate principal amount originally issued at the U.S. Dollar Equivalent of theiroutstanding principal amount as at the relevant redemption date. See “Terms andConditions of the Bonds — Redemption Purchase and Cancellation — Redemption at theOption of the Issuer”. As a result the trading price of the Bonds may be affected when this

option of the Issuer becomes exercisable. Accordingly Bondholders may not be able to sell

their Bonds at an attractive price thereby exercise of the Issuer’s option to redeem the Bond

could have a material adverse effect on the trading price and liquidity of the Bonds. In

addition the Bondholders may not be able to reinvest the redemption proceeds at an

– 45 –effective interest rate and may only be able to do so at a significantly lower rate. Potential

investors should consider reinvestment risk in light of other investments available at that

time.Short selling of the Shares by Bondholders could materially and adversely affect the market

price of the Shares.The issuance of the Bonds may result in downward pressure on the market price of the

Shares. Investors in convertible securities may seek to hedge their exposure in the

underlying equity securities often through short selling of the underlying equity securities

or similar transactions. Any short selling and similar hedging activity could place

significant downward pressure on the market price of the Shares thereby having a

material adverse effect on the market value of the Shares owned by an investor as well as on

the trading price of the Bonds.The Issuer may be unable to obtain and remit foreign currencies out of the PRC.The Issuer’s ability to satisfy its obligations under the Bonds will be affected by its ability to

obtain and remit sufficient foreign currency. The Issuer must present certain documents to

the SAFE its authorised branch or the designated foreign exchange bank for registration

before it can obtain and remit foreign currencies out of China. If the Issuer for any reason

fails to satisfy any of the PRC legal requirements for remitting foreign currency payments

it may affect the Issuer’s ability to satisfy its obligations under the Bonds without any delay.The market value of the Bonds may fluctuate.Trading prices of the Bonds are influenced by numerous factors including the results of

operations and/or financial condition and business strategy (in particular further issuance

of debt or corporate events such as share sales reorganisations takeovers or share

buybacks) of the Group and/or the subsidiaries and/or associated companies of the Group

political economic financial regulatory and any other factors that can affect the capital

markets the industry the Group and/or the subsidiaries and/or associated companies of the

Group generally. Adverse economic developments in Hong Kong and China as well as

countries in which the Group and/or the subsidiaries and/or associated companies of Group

operate or have business dealings could have a material adverse effect on the Hong Kong

economy and the results of operations and/or the financial condition of the Group and/or

the subsidiaries and/or associated companies of the Group.In addition the market price of the Bonds is expected to be affected by fluctuations in the

market price of the Shares. There can be no certainty as to the effect if any that future

issues or sales of Shares or the availability of such Shares for future issue or sale will have

on the market price of the Shares prevailing from time to time and therefore on the market

price of the Bonds. Disposals of shares by shareholders or a perception in the market that

such disposals could occur could adversely affect the prevailing market price of the Shares

and the Bonds.– 46 –Changes in interest rates may have an adverse effect on the price of the Bonds.The Bonds will not bear interest. The Bondholders may suffer unforeseen losses due to

fluctuations in interest rates. Generally a rise in interest rates may cause a fall in the prices

of the Bonds resulting in a capital loss for the Bondholders. Conversely when interest rates

fall the prices of the Bonds may rise. The Bondholders may enjoy a capital gain.The return on the Bonds may decrease due to inflation.The Bondholders may suffer erosion on the return of their investments due to inflation. The

Bondholders would have an anticipated rate of return based on expected inflation rates on

the purchase of the Bonds. An unexpected increase in inflation could reduce the actual

returns.The U.S. dollar return on the Bonds may be adversely affected by changes in the exchange

rates between the Renminbi and the U.S. dollar.The Bonds are U.S. dollar-settled debt instruments. Bondholders are required to pay the

subscription money for the Bonds in U.S. dollars based on the exchange rate between

Renminbi and the U.S. dollar fixed on the pricing date of the Bonds. In addition all

amounts due from the Issuer under the Bonds including the redemption price premium

and/or default interest of the Bonds will be settled in U.S. dollars at the spot rate between

Renminbi and the U.S. dollar prior to the time of payment. Accordingly the U.S. dollar

return on the Bonds will depend on the principal amount the premium and/or default

interest converted into U.S. dollars at the spot rate. Any volatility of the exchange rate

between Renminbi and the U.S. dollar during the term of the Bonds will affect the return on

the Bonds in U.S. dollars. In particular any devaluation of the Renminbi against the U.S.dollar during the term of the Bonds will decrease the U.S. dollar return on the Bonds which

is calculated in Renminbi. In the event of a material devaluation of the Renminbi against

the U.S. dollar Bondholders may not receive the full U.S. dollar subscription money upon

redemption of the Bonds.Lack of a public market for the Bonds.The Bonds are a new issue of securities for which there is currently no trading market.Application will be made to the Hong Kong Stock Exchange for the listing and permission

to deal in the Bonds by way of debt issues to Professional Investors only. However no

assurance can be given that an active trading market for the Bonds will develop or as to the

liquidity or sustainability of any such market the ability of Bondholders to sell their Bonds

or the price at which Bondholders will be able to sell their Bonds. If an active market for the

Bonds fails to develop or be sustained the trading price of the Bonds could fall.If an active trading market were to develop the Bonds could trade at a price that may be

lower than the initial offering price of the Bonds. Whether or not the Bonds will trade at

lower prices depends on many factors including:. prevailing interest rates and the market for similar securities;. general economic market and political conditions;. the financial condition financial performance and future prospects of the Issuer;

– 47 –. the publication of earnings estimates or other research reports and speculation in the

press or investment community in relation to the Issuer; and. changes in the industry and competition affecting the Group.The Bonds may not be a suitable investment for all investors.Each potential investor in the Bonds must determine the suitability of that investment in

light of its own circumstances. In particular each potential investor should:. have sufficient knowledge and experience to make a meaningful evaluation of the

Bonds and the merits and risks of investing in the Bonds and the information

contained in this Offering Circular;. have access to and knowledge of appropriate analytical tools to evaluate in the

context of its particular financial situation an investment in the Bonds and the impact

such investment will have on its overall investment portfolio;. have sufficient financial resources and liquidity to bear all of the risks of an investment

in the Bonds including where the currency for principal is different from the potential

investor’s currency;. understand thoroughly the terms of the Bonds and be familiar with the behavior of any

relevant indices and financial markets; and. be able to evaluate (either alone or with the help of a financial advisor) possible

scenarios for economic interest rate and other factors that may affect its investment

and its ability to bear the applicable risks.The Bonds are complex financial instruments. Sophisticated institutional investors

generally do not purchase complex financial instruments as stand-alone investments.They purchase complex financial instruments as a way to reduce risk or enhance yield with

an understood measured appropriate addition of risk to their overall portfolios. A

potential investor should not invest in the Bonds which are complex financial instruments

unless it has the expertise (either alone or with the help of a financial adviser) to evaluate

how the Bonds will perform under changing conditions the resulting effects on the value of

the Bonds and the impact this investment will have on the potential investor’s overall

investment portfolio.The Bonds contain provisions regarding modification waivers and substitution which could

affect the rights of Bondholders.The Terms and Conditions contain provisions for calling meetings of Bondholders to

consider matters affecting their interests generally. These provisions permit defined

majorities to bind all Bondholders including Bondholders who did not attend and vote at

the relevant meeting and Bondholders who voted in a manner contrary to the majority.The Trust Deed further provides that the Trustee may but shall not be obliged to agree

without the consent of the Bondholders to any modification of the Trust Deed the Terms

and Conditions the Bonds and/or the Agency Agreement which in the opinion of the

Trustee is of a formal minor or technical nature or is made to correct a manifest error or to

comply with any mandatory provision of law.– 48 –In addition the Trustee may also but shall not be obliged to without the consent of the

Bondholders agree to any modification (except as mentioned in the Trust Deed) and any

waiver or authorisation of any breach or proposed breach of the Bonds the Trust Deed the

Terms and Conditions or the Agency Agreement (other than a proposed breach or a breach

relating to the subject of certain reserved matters) if in the opinion of the Trustee is not

materially prejudicial to the interests of the Bondholders.Exchange rate risks and exchange controls may affect an investor’s returns on the Bonds.Investment in the Bonds presents certain risks relating to currency conversions if an

investor’s financial activities are denominated principally in a currency or currency unit (the

“Investor’s Currency”) other than U.S. dollars. These include the risk that exchange rates

may significantly change (including changes due to devaluation of the U.S. dollars or

revaluation of the Investor’s Currency) and the risk that authorities with jurisdiction over

the Investor’s Currency may impose or modify exchange controls. An appreciation in the

value of the Investor’s Currency relative to U.S. dollars would decrease (i) the Investor’s

Currency-equivalent yield on the Bonds; (ii) the Investor’s Currency-equivalent value of the

principal payable on the Bonds; and (iii) the Investor’s Currency-equivalent market value of

the Bonds. Government and monetary authorities may impose (as some have done in the

past) exchange controls that could adversely affect an applicable exchange rate. As a result

investors may receive less principal than expected or no principal.Legal investment considerations may restrict certain investments.The investment activities of certain investors are subject to legal investment laws and

regulations or review or regulation by certain authorities. Each potential investor should

consult its legal advisers to determine whether and to what extent:. the Bonds are legal investments for it;. the Bonds can be used as collateral for various types of borrowing; and. any other restrictions apply to its purchase or pledge of the Bonds.Financial institutions should consult their legal advisers or the appropriate regulators to

determine the appropriate treatment of the Bonds under any applicable risk-based capital

or similar rules.The Issuer’s subsidiaries jointly controlled entities and associated companies are subject to

restrictions on the payment of dividends and the repayment of intercompany loans or advances

to the Issuer its jointly controlled entities and associated companies.The Issuer depends on the receipt of dividends and the interest and principal payments on

intercompany loans or advances from its subsidiaries jointly controlled entities and

associated companies to satisfy its obligations including its obligations under the Bonds.The ability of the Issuer’s subsidiaries jointly controlled entities and associated companies

to pay dividends and make payments on intercompany loans or advances to their

shareholders is subject to among other things distributable earnings cash flow conditions

restrictions contained in the articles of association of these companies applicable laws and

restrictions contained in the financing agreements or other debt instruments of such

companies. The Issuer cannot assure that its subsidiaries jointly controlled entities and

associated companies will have distributable earnings or will be permitted to distribute their

– 49 –distributable earnings to it as it anticipates or at all. In addition dividends payable to it by

these companies are limited by the percentage of its equity ownership in these companies.Further if any of these companies raises capital by issuing equity securities to third parties

dividends declared and paid with respect to such shares would not be available to the Issuer

to make payments on the Bonds. These factors could reduce the payments that the Issuer

receives from its subsidiaries jointly controlled entities and associated companies which

would restrict its ability to meet its payment obligations under the Bonds.PRC laws and regulations permit payment of dividends only out of accumulated profits as

determined in accordance with PRC accounting standards and regulations. The PRC

subsidiaries jointly controlled entities and associated companies of the Issuer or its

non-PRC subsidiaries jointly controlled entities and associated companies are also required

to (i) set aside a portion of their post-tax profits according to PRC accounting standards

and regulations to fund certain reserves that are not distributable as cash dividends and (ii)

cover the deficit of prior years to the extent such reserves fall short of deficit coving.Any failure to complete the relevant filings under Order 56 and the relevant registration with

SAFE within the prescribed time frame following the completion of the issue of the Bonds may

have adverse consequences for the Issuer and/or the investors of the Bonds.Effective from 10 February 2023 the NDRC issued Order 56 which has superseded the

Notice on Promoting the Reform of the Filing and Registration System for Issuance of

Foreign Debt by Corporates (國家發展改革委關於推進企業發行外債備案登記制管理改革的

通知). Under Order 56 the Issuer shall (i) obtain a Certificate of Review and Registration

of Enterprise Borrowing of Foreign Debt from the NDRC (the “NDRC Certificate”) (ii)

file or report or cause to be filed or reported with the NDRC the requisite information and

documents within ten PRC business days after each foreign debt issuance and the expiration

of the NDRC Certificate in accordance with Order 56 (iii) file or report or cause to be filed

or reported with the NDRC status of utilisation of foreign debt funds the status of and the

plan for repayment of principal key operating indicators etc. within five PRC business

days before the end of January and the end of July each year (iv) file or report or cause to

be filed or reported the requisite information and documents upon the occurrence of any

material event that may affect the enterprise’s due performance of its debt obligations and

comply with other obligations under Order 56.The NDRC has issued a certificate on 25 July 2025 in accordance with Order 56. Failure to

comply with the NDRC post-issue and continuing obligations (such as post-issue reporting

pre-issuance approval expiration reporting periodical reporting and major event reporting

etc.) under articles 24 and 26 of Order 56 may result in the relevant entities being ordered to

make corrections within a time limit and in the case of aggravating circumstances or in the

case that such corrections are not made within the prescribed time limit relevant entities

and their main person-in-charge will be warned. The aforesaid regulatory violations

committed by enterprises shall be publicised on the “Credit China” website and the national

enterprise credit information publicity system among others.The Issuer undertakes that it will within the relevant prescribed timeframes after the Issue

Date file or cause to be filed with the NDRC the requisite information and documents in

respect of the Bonds in accordance with Order 56 and comply with the continuing

obligations under Order 56 and other applicable PRC laws and regulations in relation to the

issue of the Bonds.– 50 –In accordance with the Foreign Debt Registration Measures issued by SAFE on 28 April 2013which came into effect on 13 May 2013 and as amended from time to time (the “Foreign DebtRegistration Measures”) and the Circular of the People’s Bank of China on Issues Concerning the

Overall Macro Prudential Management System for Cross-border Financing (中國人民銀行關於

全口徑跨境融資宏觀審慎管理有關事宜的通知) (the “Cross-Border Financing Circular”) the

Issuer shall complete foreign debt registration in respect of the issue of the Bonds with the local

branches of SAFE in accordance with relevant laws and regulations. According to the Foreign

Debt Registration Measures and the Cross-Border Financing Circular and based on the Issuer’s

inquiries with local SAFE the Issuer is required to register the Bonds within 15 working days

after execution of the Issue Date and complete such registration in accordance relevant laws and

regulations. Before such registration of the Bonds is completed it is uncertain whether the Bonds

are enforceable under the PRC laws and it may be difficult for Bondholders to recover amounts

due from the Issuer and the Issuer may not be able to remit the proceeds of the offering into the

PRC or remit money out of the PRC in order to meet its payment obligations under the Bonds.Pursuant to article 27(5) of the Foreign Debt Registration Measures a failure to comply with

registration requirements may result in a warning and fine as set forth under article 48 of the

Foreign Exchange Administrative Regulations (外匯管理條例) promulgated by the State Council

in 2008. However pursuant to article 40 of the Foreign Debt Administration Provisional Rules

(外債管理暫行辦法) promulgated by the Ministry of Finance the NDRC and SAFE a failure by

a domestic entity to register a foreign debt contract will render the contract not legally binding

and unenforceable. Under the Terms and Conditions the Issuer has undertaken to use its best

endeavours and it intends to complete the registration of the Bonds with SAFE within 90

Registration Business Days after the Issue Date. The Issuer has already consulted with local

SAFE in connection with the registration procedures and documentary requirements. In the

unlikely event that having exercised its best endeavours the Issuer is unable to complete such

registration on or before the Registration Deadline (as defined in the Terms and Conditions) the

Issuer may have difficulty in remitting funds offshore to service payments in respect of the Bonds

and investors may encounter difficulties in enforcing judgments obtained in the Hong Kong

courts with respect to the Bonds and the Trust Deed in the PRC. In such circumstances the value

and secondary market price of the Bonds may also be materially and adversely affected.There may be filing or other requirements of the CSRC or other PRC government authorities

in relation to our proposed issuance of the Bonds or further capital raise activities.On 17 February 2023 the CSRC released the Trial Administrative Measures of Overseas

Securities Offering and Listing by Domestic Companies (境內企業境外發行證券和上市管理

試行辦法) and supporting guidelines (together the “CSRC Filing Rules”) which came into

effect on 31 March 2023. The CSRC Filing Rules will regulate both direct and indirect

overseas offering and listing of PRC domestic companies’ securities by adopting a

filing-based regulatory regime. According to the CSRC Filing Rules indirect overseas

offering and listing of domestic companies refers to securities offerings and listings in an

overseas market made under the name of an offshore entity but based on the underlying

equity assets earnings or other similar rights of a company in mainland China that

operates its main business in mainland China. The CSRC Filing Rules state that any

post-listing follow-on offering by an issuer in an overseas market including issuance of

shares convertible bonds and other similar securities shall be subject to filing requirement

within three business days after the completion of the offering. In connection with the

CSRC Filing Rules on 17 February 2023 the CSRC also published the Notice on the

Administrative Arrangements for the Filing of Overseas Securities Offering and Listing byDomestic Enterprises (關於境內企業境外發行上市備案管理安排的通知) (the “Notice on– 51 –Overseas Listing Measures”). According to the Notice on Overseas Listing Measures

issuers that have already been listed in an overseas market by 31 March 2023 the date the

Overseas Listing Measures became effective are not required to make any immediate filing

and are only required to comply with the filing requirements under the CSRC Filing Rules

when it subsequently seeks to conduct a follow-on offering. We have been advised that we

are required to go through filing procedures with the CSRC after the completion of this

offering of the Bonds and for our future offerings and listing of our securities in an overseas

market under the CSRC Filing Rules for this offering. The CSRC Filing Rules provide that

an overseas offering and listing including the follow-on offering of convertible bonds is

prohibited under any of the following circumstances: if (i) such securities offering and

listing is explicitly prohibited by provisions in laws administrative regulations and relevant

state rules; (ii) the intended securities offering and listing may endanger national security as

reviewed and determined by competent authorities under the State Council in accordance

with law; (iii) the domestic company intending to make the securities offering and listing or

its controlling shareholder(s) and the actual controller have committed relevant crimes

such as corruption bribery embezzlement misappropriation of property or undermining

the order of the socialist market economy during the latest three years; (iv) the domestic

company intending to make the securities offering and listing is currently under

investigation for suspicion of criminal offences or major violations of laws and

regulations and no conclusion has yet been made thereof; or (v) there are material

ownership disputes over equity held by the domestic company’s controlling shareholder(s)

or by other shareholder(s) that are controlled by the controlling shareholder(s) and/or

actual controller (the “Forbidden Circumstances”). In addition in the process of filing

where the issuer may be under any of the Forbidden Circumstances the CSRC may solicit

the opinions of the competent government authorities under the State Council.We will comply with applicable filing requirements as appropriate. However the

interpretation application and enforcement of the CSRC Filing Rules are evolving. We

cannot assure you that we are able to meet such requirements obtain such permit from the

relevant government authorities or complete such filing in a timely manner or at all. In

addition we cannot guarantee that new rules or regulations promulgated in the future will

not impose any additional requirements on us. If it is determined that we are subject to any

approval filing other governmental authorisation or requirements from the CSRC or other

PRC government authorities we may fail to obtain such approval or meet such

requirements in a timely manner or at all. Such failure may subject us to fines penalties

or other sanctions which may have a material adverse effect on our business and financial

condition.We are subject to risks related to PBOC’s changes in registration and reporting requirements.The Cross Border Financing Circular established a mechanism aimed at regulating cross

border financing activities conducted by domestic institutions including domestic

enterprises and financial institutions other than the governmental financing platforms

and real estate enterprises based on the capital or net asset of the borrowing entities using a

prudent management principle on a macro nationwide scale.Neither the PBOC nor SAFE has promulgated implementation rules of the Cross Border

Financing Circular. The registration and reporting process for the aforesaid regulations and

the interpretation and enforcement of the Cross Border Financing Circular thus involve

substantial uncertainties due to its recent promulgation and publication.– 52 –Bondholders have limited anti-dilution protection.The Conversion Price will be adjusted in the event that there is a consolidation sub-division

or reclassification capitalisation of profit or reserves rights issue capital distributions

other dilutive events or upon change of control but only in the situations and only to theextent provided in “Terms and Conditions of the Bonds — Conversion — Adjustments toConversion Price”. There is no requirement that there should be an adjustment for every

corporate or other event that may affect the value of the Shares. vents in respect of which

no adjustment is made may adversely affect the market price of the Shares and therefore

adversely affect the market price of the Bonds.Future issuances of Shares or equity-related securities may depress the trading price of the H

Shares.Any issuance of the Issuer’s equity securities after this offering could dilute the interest of

the existing shareholders and could substantially decrease the trading price of the Shares.The Issuer may issue equity securities in the future for a number of reasons including to

finance its operations and business strategy (including in connection with acquisitions

strategic collaborations or other transactions) to adjust its ratio of debt-to-equity to

satisfy its obligations upon the exercise of outstanding warrants options or other

convertible bonds or for other reasons. Sales of a substantial number of Shares or other

equity-related securities in the public market (or the perception that such sales may occur)

could depress the market price of the Shares. The Issuer cannot predict the effect that future

sales of the Shares or other equity-related securities would have on the market price of the

Shares. In addition the price of the Shares could be affected by possible sales of the Shares

by investors who view the Bonds as a more attractive means of obtaining equity

participation in the Issuer and by hedging or engaging in arbitrage trading activity

involving the Bonds.The conversion of some or all of the Bonds will dilute the ownership interest of existing

shareholders.The conversion of some or all of the Bonds will dilute the ownership interest of existing

shareholders. Any sales in the public market of the H Shares issuable upon such conversion

or exercise or the perception that such sale may occur could adversely affect prevailing

market prices of the H Shares and the Bonds. In addition the existence of the Bonds may

encourage short selling by market participants because the conversion of the Bonds could

depress the market price of the H Shares.Enforcement of shareholder rights; mandatory arbitration.Currently the primary sources of shareholder rights are our Articles of Association the

PRC Company Law the PRC regulations and the listing rules of the Hong Kong Stock

Exchange and the Shenzhen Stock Exchange which among other things impose certain

standards of conduct fairness and disclosure on us our directors and our controlling

shareholder. In general these rights are different from those applicable to companies

incorporated in the United States the United Kingdom and many European countries. In

addition the mechanism for enforcement of rights under the corporate framework to which

we are subject may also be relatively undeveloped and untested. To our knowledge there

has not been any published report of judicial enforcement in the PRC by holders of H

Shares of their rights under constituent documents of joint stock limited companies or the

– 53 –PRC Company Law or in the application or interpretation of the PRC or Hong Kong

regulatory provisions applicable to PRC joint stock limited companies. We cannot assure

you that our shareholders will enjoy the protections to which they may be entitled in other

jurisdictions.China does not have treaties providing for the reciprocal recognition and enforcement of

judgments of courts with the United States the United Kingdom or most European

countries and therefore there can be no assurance that recognition and enforcement in

China of judgments of a court in any of these jurisdictions in relation to any matter not

subject to a binding arbitration provision may be assured. Our Articles of Association as

well as the Listing Rules provide that most disputes between holders of H Shares and us

our directors supervisors officers or holders of domestic shares arising out of the Articles

of Association or the PRC Company Law concerning the affairs of our company or with

respect to the transfer of our shares are to be resolved through arbitration by arbitration

organisations in Hong Kong or China rather than through a court of law. An arrangement

was made between Hong Kong and Mainland China for the mutual enforcement of arbitral

awards which was approved by the Supreme People’s Court of the PRC and the Hong

Kong Legislative Council and became effective on 1 February 2000 and was further

supplemented in 2020 and 2021. We are uncertain as to the outcome of any action brought

in China to enforce an arbitral award granted to shareholders.The Bonds will initially be represented by the Global Certificate and holders of a beneficial

interest in the Global Certificate must rely on the procedures of the relevant Clearing System.The Bonds will initially be represented by the Global Certificate. Such Global Certificate

will be deposited with a common depositary for Euroclear and Clearstream (together the

“Clearing Systems” and each a “Clearing System”). Except in the circumstances described in

the Global Certificate investors will not be entitled to receive definitive Bonds. The

relevant Clearing System will maintain records of the beneficial interests in the Global

Certificate. While the Bonds are represented by the Global Certificate investors will be able

to trade their beneficial interests only through the Clearing Systems.While the Bonds are represented by the Global Certificate the Issuer will discharge its

payment obligations under the Bonds by making payments to the common depositary for

Euroclear and Clearstream for distribution to their account holders. A holder of a

beneficial interest in the Global Certificate must rely on the procedures of the relevant

Clearing System to receive payments under the Bonds. The Issuer has no responsibility or

liability for the records relating to or payments made in respect of beneficial interests in

the Global Certificate.Holders of beneficial interests in the Global Certificate will not have a direct right to vote in

respect of the Bonds. Instead such holders will be permitted to act only to the extent that

they are enabled by the relevant Clearing System to appoint appropriate proxies.– 54 –USE OF PROCEEDS

The net proceeds from this offering after deduction of fees commissions and certain

estimated offering expenses will be approximately US$494.30 million (equivalent to

approximately RMB3543 million). The Issuer intends to use the net proceeds of this

offering for enhancing the Issuer’s R&D investments in computility products.– 55 –CAPITALISATION AND INDEBTEDNESS

The following table sets forth the Group’s capitalisation and indebtedness as of 31

December 2024 and as adjusted to give effect to this offering. You should read this table in

conjunction with the Group’s audited consolidated financial statements as of 31 December

2024 and related notes incorporated by reference in this Offering Circular.

As of 31 December 2024

Actual As Adjusted(2)

RMB US$(1) RMB US$(1)

(in millions)

Indebtedness

Short-term loans. . . . . . . . . . . . . . . 11475.03 1572.07 11475.03 1572.07

Long-term loans . . . . . . . . . . . . . . . 44058.92 6036.05 44058.92 6036.05

Bonds payable . . . . . . . . . . . . . . . . 1004.88 137.67 1004.88 137.67

Bonds to be issued . . . . . . . . . . . . . — — 3584.00 491.01

Total indebtedness . . . . . . . . . . . . . . . . 56538.83 7745.79 60122.83 8236.80

Total shareholders’ equity. . . . . . . . . . . 73110.28 10016.07 73110.28 10016.07

Total capitalisation(3). . . . . . . . . . . . . . 129649.11 17761.86 133233.11 18252.87

Notes:

(1) Amounts in Renminbi have been translated at an exchange rate of USD1.00 = RMB7.2993 being the

noon buying rate as set forth in the H.10 statistical release of the Federal Reserve Bank of New York on

31 December 2024. No representation is made that the RMB amounts should have been could have been

or may be converted to U.S. dollars or vice versa at that rate.

(2) As adjusted as of 31 December 2024 to give effect to the issue of the Bonds and the proceeds we are

expecting to receive from the issue of the Bonds (before deducting underwriting commissions and certain

estimated offering expenses). In accordance with International Accounting Standards 32 Financial

Instruments: Presentation a convertible bond that can be converted to equity share capital at the option of

the holder which is accounted for as compound financial instruments contains both a liability component

and an equity component. For illustrative purpose the aggregate proceeds we are expecting to receive

from the issue of the Bonds (before deducting underwriting commissions and certain estimated offering

expenses) will be assumed as the liability component and no allocation to the equity component will be

made.

(3) Total capitalisation represents the sum of the total indebtedness and total shareholders’ equity.

Other than as disclosed above there has been no material change in the Issuer’s

consolidated capitalisation or indebtedness since 31 December 2024.– 56 –DIVIDENDS

Subject to the laws of the PRC and the Articles of Association the Issuer shall distribute

dividends to shareholders on a yearly basis in a specific proportion out of the distributable

profit realised for the year. The Issuer may distribute dividends in cash or in shares. Under

favourable circumstances the Issuer may distribute interim dividends. When distributing

dividends to shareholders the Issuer shall withhold and turn over the tax payable on the

dividend income of shareholders based on the amount distributed and in accordance with

PRC tax laws.Dividends or other distributions of the Issuer shall be declared and calculated in Renminbi.Where the Company makes payment to holders of foreign investment shares in foreign

currency the foreign currency shall be arranged in accordance with the relevant state

foreign exchange regulations.The Board has recommended the payment of a final dividend of RMB6.17 for every 10

shares (before tax) in respect of the year ended 31 December 2024. The final dividend has

been approved by the shareholders of the Issuer at the 2024 annual general meeting of the

Issuer.– 57 –DESCRIPTION OF THE GROUP

OVERVIEW

The Issuer was incorporated on 11 November 1997 as a joint stock limited liability company

in Guangdong Province the PRC. The Issuer’s A shares were listed on the main board of

the Shenzhen Stock Exchange following an initial public offering in November 1997 stock

code 000063.SZ. It became the first A share company to be listed on the Main Board of the

Hong Kong Stock Exchange following an initial public offering of H shares in December

2004 stock code 00763.HK. The controlling shareholder of the Group is Zhongxingxin

Telecom Company Limited a company which was incorporated in the PRC on 29 April

1993 and has a registered capital of RMB100 million. The Issuer is independent of its

controlling shareholder in respect of assets staffing finance organisation and business.The Issuer and its controlling shareholder are being audited independently and each

assumes its own responsibilities and risks.The Group is a world-leading provider of integrated telecommunications and IT solutions

with a full range of end-to-end ICT products and solutions integrating design

development production sales and services with a special focus on carriers’ networks

consumer business and government and corporate business. As a global leading provider of

integrated ICT solutions the Group is organised into business units based on its products

and services and has three core operating segments as follows:. Carrier’s Network. The carriers’ network business focuses on meeting carriers’

requirements in network evolution with the provision of wireless access wireline

access bearer systems core networks service and storage and other innovative

technologies and production solutions.. Consumer Business. The consumer business focuses on bringing experience in smart

devices to customers while also catering to the requirements of industry clients through

the development production and sale of products such as home information terminal

smart phones mobile Internet terminals innovative fusion terminals as well as the

provision of related software application and value-added services.. Government and Corporate Business. The government and corporate business focuses

on meeting requirements of government and corporate clients providing

informatisation solutions for the government and corporations through the

application of products such as communications networks IOT Big Data and cloud

computing.Technological leadership is the cornerstone of the Group’s development. As at 31 December

2024 the Group has a headcount of over 33000 R&D personnel representing over 48.5%

of its total workforce. The Group is a major contributor of global patents and participant in

the research and standard formulation for global 5G technology. As at 31 December 2024

the Group had submitted approximately 93000 global patent applications and owned

approximately 48000 authorised global patents including approximately 5500 patent

applications and over 2000 authorised patents in the chip sector. In the AI sector the

Group had over 5000 patent applications and close to half of them had been authorised.The Group has received 11 gold awards 3 silver awards and 39 awards of excellence in the

patent awards of China. The Group is a member of more than 200 international

standardisation organisations industry alliances scientific associations and open-source

– 58 –communities such as ITU (International Telecommunication Union) 3GPP (third

generation partnership programme) ETSI (European Telecommunications Standards

Institute) NGMN (The Next Generation Mobile Networks) IEEE (Institute of Electrical

and Electronics Engineers) CCSA (The China Communications Standards Association)

5GAIA (5G Applications Industry Array) and AII (Alliance of Industrial Internet) and a

board member of numerous organisations such as GSA (Global Suppliers’ Alliance) and

ETSI (The European Telecommunications Standards Institute).With innovative technologies and product solutions the Group serves global telecom

operators consumers and government and enterprise customers. Covering more than 160

countries and regions the Group serves over one-fourth of people worldwide and is

committed to achieving a future of global connectivity and trust. The Group strives to

create an intelligent future with digital innovation an excellent growth platform for

employees and greater value for customers shareholders and stakeholders across the globe.The Group intends to persist in its innovation-driven approach and maintain its strategic

focus to speed up transition from connectivity to computility while controlling operational

risks to maintain stable operations.As at 31 December 2024 the total share capital of the Issuer was 4783534887 shares

(including 4028032353 A shares and 755502534 H shares) all of which have already been

paid up. As at 31 December 2022 2023 and 2024 the Group’s total assets amounted to

RMB180953.6 million RMB200958.3 million and RMB207323.2 million. For the years

ended 31 December 2022 2023 and 2024 the Group recorded operating revenue of

RMB122954.4 million RMB124250.9 million and RMB121298.8 million respectively.For the same periods the Group recorded net profit attributable to holders of ordinary

shares of the listed company of RMB8080.3 million RMB9325.8 million and RMB8424.8

million respectively.COMPETITIVE STRENGTHS

Commitment to long-term investment and mastery of foundational technologies.The Group is committed to long-term investment and leverages its strengths as it seeks to

position itself as a “path-builder for digital economy”. Driven by this commitment the

Group continues to advance R&D efforts across connectivity and computility as a form of

long-term investment with a strong emphasis on achieving mastery of foundational

technologies. These efforts which led to breakthroughs in technology support the ongoing

enhancement of core products and solutions spanning network segment computility

infrastructure terminal and digital energy as well as the development of new patents.Mastery of foundational technologies

The Group continues to strengthen its position as one of the world leaders in chip design

and innovation. Since initiating its chip R&D efforts in 1996 the Group has steadily

deepened its investment in advanced process technique design advanced architecture and

seal packaging design core intellectual properties and digitalised efficient development

platforms. Through years of structured and purposeful R&D efforts the Group has

attained comprehensive end-to-end chip design capabilities that serve as the backbone to

its mastery of foundational technologies.– 59 –The Group has achieved sustained advances in operating systems underpinned by

long-term proprietary R&D across foundational technologies such as internal core

virtualisation and development tooling. Its systems are at the forefront of the industry in

terms of real-time performance reliability and security and support a complete suite of

solutions for a broad range of devices including built-in devices servers desktop

platforms and terminals. These solutions have been widely adopted across key sectors

such as telecommunication automotive energy and railway transportation providing

global customers with secure reliable and functionally robust foundational software

platforms. The Group’s achievements in this domain have been recognised through awards

including Class I Science and Technology Award of China Institute of Communications and

the Fourth China Industry Award. The Group’s operating systems have also attained the

OSDL (Open Source Development Labs) Telecom-grade Linux accreditation Tier-four

National Information System Security accreditation China Network Security Examination

and Accreditation Centre EAL4 enhanced accreditation ISO 26262 ASIL-D management

accreditation and product accreditation for auto electronics POSIX PSE52 accreditation of

IEEE (Institute of Electrical and Electronics Engineers) safety and reliability assessment

test of China Information Technology Security Evaluation Center for server operating

system and class III (optimal grade) certification for software supply chain security. These

credentials underscore the Group’s mastery in operating systems.The Group has expanded its technological innovation and market presence in the database

domain through the development of GoldenDB its proprietary relational database product.GoldenDB supports locally-deployed database solutions tailored to users’ requirements and

industry trends. Meanwhile the Group has partnered with China Mobile in the R&D of

public cloud database products. On the technical front the Group is among the leading

developers of HTAP (hybrid transactional analytical processing) technologies in the

financial sector having achieved over 2.60 million TPS (transaction per second) in live

testing which significantly outperforms customers’ existing databases. The first batch of

the Group’s distributed database products have successfully passed the security and

reliability test of China Information Technology Security Evaluation Center. In terms of

market adoption GoldenDB held leading market share in both the financial and

telecommunications sectors in 2024 whilst also extending into the government

transportation and energy sectors. As at the end of 2024 GoldenDB supported over

RMB10000 billion in financial transaction volume and more than 10 billion core

transactions while also enabling billing for more than 900 million mobile users on a

daily basis.Network technology

The Group continued to enhance product competitiveness in the network segment through

ongoing technological innovation and remain one of the industry leaders in 5G base

stations and the network deployment. In 2024 the Group partnered with carriers to

accelerate the industrial application and technical maturity of a range of products featuring

innovative 5G-A technologies such as double 10G+ high-speed network

communication-sensing integration and air-space-terrestrial integration among others.Furthermore the Group has launched the industry’s first integrated full-speed 50G PON

solution equipped with a proprietary core chip that supports compatibility across multiple

generations of PON technologies. This solution has undergone trial deployment at more

than 50 carriers globally supporting the smooth upgrade and evolution of live networks

while accelerating sophisticated commercial application.– 60 –Computivity infrastructure

In terms of computility infrastructure the Group has strengthened its R&D efforts to

capture emerging opportunities arising from large-scale AI models. It has introduced a full

stack of intelligent computing solutions designed for deployment across diverse scenarios

empowering the digital and intelligent transformation of multiple industries. These

developments are underpinned by continued progress in open-ended decoupling and

enhanced computing through network training and inference. Collectively these initiatives

strengthen the competitiveness of the Group’s intelligent computing offerings and foster an

open ecosphere for intelligent computing.In the area of server and storage systems the Group offers a diverse portfolio of intelligent

computing products designed to meet varying scenario requirements. These products

leverage mainstream GPUs to provide users with flexible options whilst enhancing

performance and stability of intelligent computing resources through wide-area

coordination of computing storage and network. Notably the Group has independently

developed the Dinghai chip which supports multiple configurations such as RDMA cards

smart network interface cards and DPU cards to provide high-performance and diversified

computing acceleration hardware. The Group also partnered with industry players to

promote high-speed and open-ended interconnection standards for GPUs to catalyze the

development of next-generation intelligent computing servers equipped with interconnected

super nodes.In the switching domain the Group has developed and domestically manufactured an

ultra-high density 400GE/800GE frame switch based on the proprietary 7.2T distributed

forwarding chip and 112Gb/s high-speed bus technology. The switch which supports 576

400GE ports or 288 800GE ports ranks among the highest-performing products within the

industry. Additionally the 51.2T box switch supporting 128 400GE ports at first-rate

industry standards has been deployed at scale by major Internet companies demonstrating

its suitability for demanding commercial applications.Terminal products

The Group has continued to advance its “AI for All” strategy by launching terminal

products tailored to five key consumer spending scenarios including sports and health

audio-visual entertainment business travel home education and intelligent driving. These

products aim to enhance user experiences through innovative AI-driven agent-to-agent

interaction technologies. The Group consistently leads the market with top global ranking

in the dispatch for PON CPE and IP set-top boxes with the annual dispatch of our home

terminal products for 2024 exceeding 100 million units.Digital energy

The Group has introduced its Zero-Carbon Energy Net Solution V3.0 aimed at advancing

green power application improving network energy efficiency and enabling intelligent

maintenance through enhanced network power management. Building on key innovations

such as sPV (smart phovolatic) systems ultra-high-efficiency energy conversion intelligent

backup and storage smart power distribution smart temperature control and AI-based

multi-energy scheduling the Group has focused on implementing solutions for minimal site

green machine room green industrial complex and energy operation among others.Leveraging its position as a major global supplier of communications energy solutions the

– 61 –Group has carried out large-scale deployment of the 5G power supply systems and minimal

station solutions. The Group has also continued its intensive investment in the development

of core capabilities in power conversion maintaining a leading position in the industry in

terms of terms of rectifier efficiency and power density performance. The Group’s

sPV-based solar power solutions enable seamless integration at existing network sites.In addition the Group has intensified its efforts in the development of communication

energy storage and supported storage integration and multiple forms of energy storage

conducive to low-carbon energy consumption. The Group has been a leading supplier in the

communication energy storage sector with a growth rate of over 30% in terms of annual

dispatch of lithium batteries for 2024.Intellectual property

The Group is a major contributor and participant in the research and standard formulation

for global 5G technology. As at 31 December 2024 the Group had filed approximately

93000 global patent applications and held approximately 48000 authorised global patents

including approximately 5500 patent applications and over 2000 authorised patents

specifically in the chip domain. In the AI sector the Group filed over 5000 patent

applications with close to half already authorised. The Group has continued to make ETSI

(European Telecommunications Standards Institute) disclosures on its 5G standard

essential patents. Its achievements in intellectual property have been recognised with 11

gold awards 3 silver awards and 39 awards of excellence in the patent awards of China.A leading position in the ICT industry in China.Leveraging over 40 years of experience in the ICT industry in China the Group has

developed two long-standing strengths in the networking domain and two emerging

advantages in the field of integrated ICT solutions solidifying its position as a leading

player in the industry.Among its long-standing strengths the Group maintains an organisational structure

tailored to support the management of complex projects and possesses the technical

capability to catalyze software-hardware synergy. While the broader industry is actively

working towards decoupling the emerging intelligent computing intelligent computing

remains to be highly integrated and complex. With a well-developed organisational

structure the Group’s ability to organise large-scale teams across chip development

hardware design operating systems software applications and system optimisation

positions it strongly in addressing the complexity of delivering intelligent computing

solutions before full decoupling of intelligent computing is achieved. The Group’s ability to

catalyze software-hardware synergy made possible through deep software-hardware

co-design also enables the Group to deliver intelligent computing solutions with better

efficacy at a reduced cost when both software and hardware remain deeply coupled in

intelligent computing.In terms of emerging advantages the Group adopts a modular research and development

model and implements a business model which embraces collaboration with external

business partners. The Group has adopted a modular research model since 2018 to address

the increased need to shorten research and development cycles brought about by the

convergence of information technology and computational thinking. Relying on the

modular model and ZTE Digital Star Cloud Solution (中興通訊數字星雲解決方案) the

– 62 –Group has maintained its strength in delivering complex solutions while enhancing its

responsiveness to market changes. Furthermore the Group has implemented a business

model embracing collaboration with external business partners in recent years the open and

collaborative approach has and continues to foster symbiotic-like business relationships for

the Group’s accelerated growth across the value chain.Strong global market expansion and service capabilities.The Group maintains active partnership with more than 110 global telecom operators in

more than 160 countries and regions supported by a portfolio of innovative technologies

and product solutions. Global footprint of the Group’s partnered telecom operators spans

key markets including the PRC Europe Asia Pacific and the Middle East collectively

serving more than 2 billion users worldwide. In 2024 operating revenue generated by the

Group from markets outside of the PRC amounted to RMB39293.1 million representing

32.4% of our Group’s revenue for the year.

As at 31 December 2024 the Group operated 11 R&D centres globally alongside 12

overseas joint innovation centres. To support global clients the Group established a global

customer support center (GCSC) with three sub-centers in the PRC 5 regional customer

support centers (RCSC) and 40 local customer support centers (LCSC) forming a three-tier

customer support service cloud platform with coverage across key international markets.This global support infrastructure offers round-the-clock technical support in multiple

languages. The Group coordinates its global service cloud resources to ensure prompt

response to customer issues effectively maintaining the secure and stable operation of

customer networks. In addition the Group maintains a global repair center and 3

sub-centers 2 overseas regional repair centers and 12 local repair centers with a total

maintenance capacity of 600000 parts per annum. Complementing this infrastructure are a

centralised spare parts warehouse 3 regional spare parts warehouses and more than 400

local spare parts storage sites which enable the Group to provide efficient and convenient

hardware support to customers worldwide.As one of the leading Chinese technology enterprises with a focus on the development and

application of its proprietary intellectual property across foundational technologies the

Group offers attractive prospects for high-calibre technology and business professionals

both domestically and abroad. Anchored by a corporate culture that prioritises customer

value innovation mutual respect and dedication the Group has nurtured a motivated

efficient and high-quality workforce which has served and continues to serve as a robust

foundation for the Group’s future development. The Group believes in the benefits of

developing the skills and knowledge of the Group’s management team and employees and

regularly conducts both in-house and external management and professional training

programs. It has successfully attracted trained and retained a significant pool of highly

educated and experienced managers and technical professionals with extensive experience.As at 31 December 2024 the Group employs more than 10000 service engineers over 3000

PMP certified personnel and more than 2500 contractors worldwide.BUSINESS STRATEGIES

The Group positions itself as a “path-builder for digital economy” focusing on the pathway

of “connectivity + computility”. In the presence of new challenges as well as opportunitiesthe Group will operate its business on the principle of “seeking advancement while ensuringstability and pursuing innovation while assuring the principal business” and strengthen its

– 63 –resilience expediting development of the secondary-curve business represented by products

and solutions such as server and storage and data centre switch and computing and handset

on top of stable advancement of the primary-curve business represented by wireless and

wireline products in order to chart new frontiers.In connection with the Group’s primary-curve business in the domestic market the Group

will focus in identifying the potential of network products seizing opportunities arising

from the construction of 5G-A and full-optical networks to consistently enhance its

advantage of being technologically advanced and increase its market share. The Group will

persist in designating intelligent computing as a major pathway in our long-term strategy

and bring into play our strengths in full-stack technologies and engineering competence in

line with our core principles of open-ended decoupling enhancing computing through

network and training and inference. In the international market the Group will continue to

identify further potentials in major nations and big Ts (mainstream telecom carriers) for its

traditional business to consistently increase its market share and influence.In connection with the Group’s secondary-curve business the Group will focus on

advancing the application of products and solutions such as server and storage data centre

switch data centre support and training and inference. The Group will also focus on

opportunities presented by digitalisation intelligentisation low-carbon development and

IT innovation and make ongoing efforts to deepen domestic market development. The

Group will further deepen cooperation with leading players in the Internet and finance

sectors and deepen its operation in key sectors such as power transportation and

government affairs seeking to increase its market share and business scale with a special

emphasis on qualitative growth. Furthermore the Group will seek innovation and

breakthrough on the back of technologies and capabilities developed over years of R&D

effort.In view of the historic opportunity presented by the latest round of technological revolution

and industrial transformation the Group will actively embrace the new wave of digital

construction by persisting in proprietary innovation in core technologies in firm adherence

to its positioning as a “path-builder for digital economy” as it strives to enhance its

primary-curve business and bring driving force to its secondary-curve business with a

sustained strategic focus in a bid to facilitate sustainable qualitative development.– 64 –CORPORATE STRUCTURE

The following chart is a simplified structure of the Group as at 31 December 2024 :

Zhuhai Guoxing Ruike Capital

Xi’an Microelectronics Shenzhen Aerospace Guangyu Shenzhen Zhongxing WXT Management Centre (Limited

Technology Research Institute Industrial Company Limited Equipment Company Limited Partnership)

(西安微電子技術研究所)(深圳航天廣宇工業有限公司)(深圳市中興維先通設備有限公司)(珠海國興睿科資本管理中心(PRC) (PRC) (PRC) （有限合夥))

34%14.5%49%2.5%

Zhongxingxin Telecom Company Limited

(中興新通訊有限公司)

(PRC)

20.09%79.91%

ZTE CORPORATION

(中興通訊股份有限公司)

Other Shareholders

(the Issuer)

(PRC)

87.22%90%

direct direct 100%

100%100%100%100%100%

12.78% 10% indirect

indirect indirect

The Issuer carries out its business activities in the PRC primarily through subsidiaries

directly and wholly owned by it as at 31 December 2024. The following is an overview of the

major subsidiaries:. ZTE KANGXUN TELECOM CO. LTD. (深圳市中興康訊電子有限公司) was

incorporated in the PRC and directly and wholly owned by the Issuer. It has a

registered capital of RMB1755 million as at 31 December 2024. It principally engages

in the design production and sales of electrical appliances their components and

integrated circuits.. ZTE (H.K.) Limited (中興通訊（香港）有限公司) was incorporated in Hong Kong and

directly and wholly owned by the Issuer. It has a share capital of HK$2483.7 million.It principally engages in the sales of communication equipment the procurement of

electronic components and ancillary equipment R&D training and consulting services

and investment holding business in the international market.–65–

Other subsidiaries

CRS Technology Co. Ltd.(西安克瑞斯半導體技術有限公司) (PRC)

Shenzhen Zhongxing Telecom Technology & Service Company Limited

(深圳市中興通訊技術服務有限責任公司) (PRC)

ZTE (Nanjing) Co. Ltd.(中興通訊（南京）有限責任公司) (PRC)

Sanechips Technology Co. Ltd.(深圳市中興微電子技術有限公司) (PRC)

Xi’an ZTE Terminal Technology Co. Ltd.(西安中興通訊終端科技有限公司) (PRC)

Shenzhen Zhongxing Software Company Limited

(深圳市中興軟件有限責任公司) (PRC)

ZTE (H.K.) Limited

(中興通訊（香港）有限公司) (HK)

ZTE KANGXUN TELECOM CO. LTD.(深圳市中興康訊電子有限公司) (PRC). Shenzhen Zhongxing Software Company Limited (深圳市中興軟件有限責任公司) was

incorporated in the PRC and directly and wholly owned by the Issuer. It has a

registered capital of RMB51.1 million. It principally engages in the servicing of

communication equipment network planning terminal products and software

development.. Xi’an ZTE Terminal Technology Co. Ltd. (西安中興通訊終端科技有限公司) was

incorporated in the PRC and directly and wholly owned by the Issuer. It has a

registered capital of RMB300 million. It principally engages in the manufacturing and

sales of mobile terminal products digitalised family products smart family

consumption apparatus and smart in-vehicle devices.. Sanechips Technology Co. Ltd. (深圳市中興微電子技術有限公司) was incorporated in

the PRC and directly and indirectly owned as to respectively 87.22% and 12.78% by

the Issuer. It has a registered capital of RMB131.6 million. In principally engages in

the design production and sales of integrated circuits and cross-border trading.. ZTE (Nanjing) Co. Ltd. (中興通訊（南京）有限責任公司) was incorporated in the PRC

and directly and wholly owned by the Issuer. It has a registered capital of RMB1000

million. It principally engages in the development of communication equipment

production stored program control system multimedia communication system

equipment transmission system.. Shenzhen Zhongxing Telecom Technology & Service Company Limited (深圳市中興通

訊技術服務有限責任公司) was incorporated in the PRC and directly and indirectly

owned as to respectively 90% and 10% by the Issuer. It has a registered capital of

RMB200 million. It principally engages in the servicing of communication engineering

and technology and the development of computer networks electronical appliances

computer software and communication equipment.. CRS Technology Co. Ltd. (西安克瑞斯半導體技術有限公司) was incorporated in the

PRC and indirectly and wholly owned by the Issuer. It has a registered capital of

RMB1000 million. It principally engages in the design production and sales of

integrated circuits the development of computer technology electronic technology

and information technology.THE GROUP’S BUSINESS SEGMENTS

The Issuer is a world-leading provider of integrated telecommunications and IT solutions

with a full range of end-to-end ICT products and solutions integrating design

development production sales and services. The Group has a special focus on three

principal business segments namely (i) carriers’ network (ii) consumer business and (iii)

government and corporate business.– 66 –The following table sets out a breakdown of the Group’s operating revenue for the years

ended 31 December 2022 2023 and 2024 categorised by business segments:

Year ended 31 December

202220232024

Amount % Amount % Amount %

(RMB in (RMB in (RMB in

millions) millions) millions)

Carriers’ network . . . . . . . 80040.6 65.1 82758.9 66.6 70326.7 58.0

Consumer business . . . . . . 28286.1 23.0 27908.5 22.5 32406.1 26.7

Government and

corporate business . . . . . 14627.7 11.9 13583.5 10.9 18566.0 15.3

Total . . . . . . . . . . . . . . . . 122954.4 100.0 124250.9 100.0 121298.8 100.0

The following table sets out a breakdown of the Group’s operating costs for the years ended

31 December 2022 2023 and 2024 categorised by business segments:

Year ended 31 December

202220232024

Amount % Amount % Amount %

(RMB in (RMB in (RMB in

millions) millions) millions)

Carriers’ network . . . . . . . 43046.5 55.8 42116.0 57.9 34527.8 45.8

Consumer business . . . . . . 23261.3 30.1 21745.1 29.9 25063.3 33.3

Government and

corporate business . . . . . 10919.8 14.1 8841.5 12.1 15720.0 20.9

Total . . . . . . . . . . . . . . . . 77227.6 100.0 72702.6 100.0 75311.1 100.0

The following table sets out a breakdown of the Group’s gross profit margin for the years

ended 31 December 2022 2023 and 2024 categorised by business segments:

Year ended 31 December

202220232024

%%%

Carriers’ network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46.2 49.1 50.9

Consumer business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.8 22.1 22.7

Government and corporate business . . . . . . . . . . . . . . . . . . . . . . . 25.4 34.9 15.3

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37.2 41.5 37.9

Carriers’ Network

The Group’s core business is in the provision of carriers’ network which is also the main

source of the Group’s revenues and profits. The Group provides carriers’ network

predominantly by collaborating with the top three carriers in China as well as overseas

mainstream telecom carriers and providing them with end-to-end communication

equipment along with a reliable stable and effective communication network. The Group

develops the business by engaging in innovations in computing network and cloud network

integration advancing the application of products and solutions such as server and storage

data centre switch data centre support and training and inference and committing in the

development of key technologies relating to wireless access full-optical networks cloud

networks and chips. The Group settles transactions for its carriers’ network with the top

three carriers in China mostly by way of cash and commercial papers and with overseas

mainstream telecom carriers mostly by way of wire transfer and letters of credit.– 67 –The Group leverages its 20+-year proprietary R&D efforts in the distribution of operating

systems offering a complete range of solutions for operating systems of equipment types

such as built-in device server desktop system and terminals that have been extensively used

in the communication automobile electricity and railway transportation sectors. The

Group’s operating systems have attained the OSDL (Open Source Development Labs)

Telecom-grade Linux accreditation Tier-four National Information System Security

accreditation China Network Security Examination and Accreditation Centre EAL4

enhanced accreditation ISO 26262 ASIL-D management accreditation and product

accreditation for auto electronics POSIX PSE52 accreditation of IEEE (Institute of

Electrical and Electronics Engineers) safety and reliability assessment test of China

Information Technology Security Evaluation Center for server operating system and class

III (optimal grade) certification for software supply chain security.The Group designs mobile communication networks for its carrier and industry customers.It creates product solutions with special features for scenarios such as the high-speed rail

indoor hotspots and scenic areas. Its carriers’ networks allow for multiple frequencies

multiple modes and high integration levels. It distributes products for wireless access such

as the 2.6GHz+4.9GHz dual-frequency 64TR AAU with a 20Bbps+ throughput volume

1.6GHz bandwidth millimeter wave AAU with a 25Gbps+ throughput volume and

medium-frequency pooling MiCell millimeter wave distributed mini-stations. It also

distributes products for wireline access such as the integrated full-speed

50-Gigabit-capable Passive Optical Network (50G PON) with a proprietary core chip

compatible with PON technologies of different generations.The Group seeks to expand its 5G-A innovations applications and practices as it

collaborates with carriers to achieve (i) double 10G+ maximum limit network (ii)

communication and sensor integration and (iii) air-space-terrestrial integration. It has

expanded its 10G networks to new business sectors such as cultural activities and

entertainment programme production and broadcast metro transport and cruise. It

distributes its large spread-angle 128TR AAU product to fulfill integrated communication

and sensor capabilities at low altitudes of 0–600 meters serving multiple areas from

logistical distribution low-altitude security defense to low-altitude smart industry park

and security protection and inspection. It completed verification of the carrier NR-NTN

(non-terrestrial network) low-orbit satellite laboratory simulation the verification test for

general service carrier and verification of the NR-NTN+VoWiFi integrated network. In

line with the evolution of 5G-A intelligentisation the Group also operates the AI Core an

initiative to fully integrate AI capabilities into networks business service and maintenance

enabling and assisting carriers to enhance their network efficiency and facilitate network

realisation through AI.When providing and maintaining carriers’ network the Group derives earnings from

offering value-added solutions relating to individual electronic components (such as surface

wave soldering and in-circuit testing) as well as solutions relating to complete units of

communication equipment (such as high-temperature testing packaging and warehousing).The Group also earns from manufacturing and distributing wireless products (such as

2/3/4/5G multi-mode wireless access products microwave cloud core network and servers)

as well as wireline products (such as optical storage optical access high-end routers data

centre exchanges industry park exchanges and end products). The Group’s manufacturing

facilities for its wireless products are primarily located in Shenzhen and Nanjing whereas

its manufacturing facilities for its wireline products are primarily located in Shenzhen

Heyuan and Changsha in China.– 68 –The costs of distributing the Group’s carriers’ network include those for human resources

management and procurement of raw materials such as integrated circuits and other

electronic components.Consumer Business

The Group started its consumer business developing and producing mobile phone-related

products in 1998. It has broadened the coverage of its consumer business into now

distributing 2/3/4/5G all-series end products to around 160 countries and regions in Asia

Africa and Europe America and Oceania. The Group has over 9 R&D centres supporting

the growth of an all-comprehensive global network of sales channels consumers and

carriers. It develops designs and sells three categories of end products being mobile

phones individual and household products and ancillary products. It owns the ZTE Nubia

and Red Magic brands. It intends to allow users of its consumer business to enjoy the

experience afforded by AI through new technologies in smart agent-to-agent interaction.The Group develops the consumer business by deploying its “AI for All” full-scenario smart

ecosphere 3.0 featuring a full upgrade of MyOS to Nebula AIOS based on the ZTE nebula

large model that focuses on five core consumer spending scenarios namely sports and

health audio-visual entertainment business travel home education and intelligent driving.The Group also introduces innovations in technologies such as under-screen camera and

bare eye 3D as it launches its flagship products including innovative terminals such as

nubia Z70 Ultra Red Magic 10 Pro and nubia Pad 3D II a bare eye 3D tablet. The Group’s

R&D units for its consumer business are committed to appearance design structural design

hardware design software development and quality control. The Group’s manufacturing

facilities for its end products are primarily located in Changsha and Xi An in China.The Group has launched Digital Nebula 3.0 to facilitate general upgrade by using as well as

leveraging AI as it helps its customers and partners with large-scale application of AI

technologies in a cost-effective manner to realise the value of “AI+”. It has developed more

than 1000 digital nebula partners and created a series of pole projects in digital and

intelligent transformation across 18 industrial sectors including industrial manufacturing

metallurgical smelting mining electricity transportation government affairs and culturaltourism for which the Group has been awarded the “2024 Leading Supplier of DigitalSolutions in China” and the “2024 Leading Enterprise in Corporate Digital and IntelligentTransformation”.When operating the consumer business the Group makes profit under two business models.It distributes packages comprising both its carriers’ network and its end products to

domestic and overseas carriers deriving earnings from the difference between the cost of

production and the wholesale price of the end products. It also distributes its products

directly to retail consumers through public and e-commerce channels deriving earnings

from the difference between the cost of production and the retail price of the end products.It settles transactions of its consumer business with carriers in China mostly by way of cash

and commercial papers with a maturity period that is no longer than six months with

overseas carriers mostly by way of wire transfer and with retail consumers mostly by way of

cash.The costs of operating the Group’s consumer business include commissions and expenses

incurred for the procurement and manufacture of electronic components such as integrated

circuits monitors storers camera models and shells.– 69 –Government and Corporate Business

Since the inception of China’s Fourteenth Five-Year Plan for the National Economic and

Social Development and Long-range Objectives Through the Year 2035 the digital

economy has become one of the core pillars of qualitative economic development. The

Group’s government and corporate business seeks to be part of this continuing process of

digital and intelligent transformation. It strives to empower the digital and intelligent

transformation of all industries and meet government and corporate clients’ demands for

intelligent computing solutions for all scenarios in return for equipment and service fees. It

settles transactions of its government and corporate business mostly by way of cash and

commercial papers.The Group operates a digital electric station to assist in the construction of multi-location

digital converter stations such as Ludao ±320kV converter station in Xiamen and

Gezhouba ±500kV converter station in Yichang in collaboration with the State Grid

Corporation of China one of the world’s largest utility companies. It collaborates with

China Southern Power Grid Company Limited a state-owned enterprise responsible for

electricity transmission and distribution in Southern China to implement digital station

projects in provinces including Guizhou Yunnan and Hainan in China. The Group also

collaborates with leading enterprises such as State Power Investment Corporation China

Huaneng Group Co. Ltd. and China Huadian Corporation being three of the five largest

state-owned power generation companies in China focusing on smart maintenance

scenarios for power generation facilities such as solar power wind power thermal power

and hydropower stations. The Group operates 5G+AI smart power plants in Liaoning

Anhui Yunnan and Guangxi in China. Its digital power generation station solution has

received a Class I Award for Cases of Excellence at the ICT China Annual Awards (2024).The Group has developed a transport computing brain around the core of a cloud platform

and the digital nebula with a digital intelligent base based on the large model to support the

building of an operational and management “smart brain” for Qingdao Metro Line. It

collaborates with China Railway China’s national passenger and freight railroad

corporation as well as the railway bureaus of Beijing Shanghai Shenyang and Jinan in

China to assist in intelligent railway operation with system cloudification and network

automation. It works with Hebei Port Group Jiangsu Port and Liaoning Port Group to

enhance data management and safe production at the port terminals. It assists in building

vehicle-road-cloud integration showcase projects in Jinan Beijing Changsha and Nanjing

in China. It also participates in digital transformation in connection with expressways in

Henan and Liaoning in China.The Group provides the only solution in the industry that features a space air and

terrestrial drone emergency aid platform covering both public and private sectors. It

supplies its large-scale unmanned helicopter rescue platforms to 10 provinces under the air

emergency category of the 2024 Special National Project for Improvement of Emergency

Response to Natural Disasters. The Group’s city lifeline solution in service in NanjingKunshan and Changsha has been recognised by the “Gold Award for Achievements in NewIoT Technologies Applications and Models” at the 2024 World IoT Expo. The Group’s

digital twin-based water conservancy solution has served in projects such as the

improvement of flood controls at Yongding River and Siyu Platform of Hebei Provincial

Department of Water Resources. The Group also launched the “Jiupai” Large Model for

Yangtze Hydrology in association with the Hydrographic Bureau under the Yangtze River

Committee of the Ministry of Water Resources. The communication safeguard system for

– 70 –extreme weather conditions at the gorge section of Yongding River built for the Group’s

customers as part of the initiative for improving flood controls at Yongding River has beenincluded in the “Promotional List of Achievements in Sophisticated and ApplicableHydrological Technologies 2024” named by the Ministry of Water Resources.HUMAN RESOURCES

The Group implements principles in line with its core values to unite staff and support the

achievement of common strategic goals. It organises daily gathering groups and reading

groups to leverage the entrepreneurship of the older generation and to build a common

awareness among staff members. It promotes and shares positive energy strives to shape a

sense of honour and belonging and encourages its staff members to engage in value-added

commitments. It embraces a corporate ambience of openness equality and team effort to

motivate staff creativity. It has in place a multi-platform matrix for communication. It

counts on its brand influence as an employer to attract high-calibre talents. It also stresses

its social responsibility to drive the co-development of the Group and the community.As at 31 December 2024 the Group had 68375 employees with an average age of 35.6 and

including 16361 female employees (or approximately 23.9% of the total staff headcount)

and 52014 male employees (or approximately 76.1% of the total staff headcount). As at 31

December 2024 48.5% and 20.3% of the Group’s total staff headcount work in R&D and

manufacturing respectively and 41.4% and 35.4% of the same received a master’s degree

or above and a bachelor’s degree respectively. The Group regularly provides all its staff

members with induction training leadership training job-specific business skill training

and compliance training. The Group’s training sessions are conducted in the form of class

lessons public lectures shared book studies case discussions themed seminars sand table

drilling project assignments and online learning or remote learning via PC terminals or

mobile phones. The Group also specifically provides its management officers with a variety

of online and offline training comprising reading classes close-ended training guided

reading and online learning.INTELLECTUAL PROPERTY

The Group is positioned within the first quadrant in terms of global patents as a major

contributor and participant in the research and standard formulation for global 5G

technology. As at 31 December 2024 the Group had submitted approximately 93000 global

patent applications and owned approximately 48000 authorised global patents including

approximately 5500 patent applications and over 2000 authorised patents in the chip

sector. In the AI sector the Group had over 5000 patent applications and close to half of

them had been authorised. The Group has continued to make ETSI (European

Telecommunications Standards Institute) disclosures on its 5G standard essential patents.The Group has received 11 gold awards 3 silver awards and 39 awards of excellence in the

patent awards of China.The Group is a member of more than 200 international standardisation organisations

industry alliances scientific associations and open-source communities such as ITU

(International Telecommunication Union) 3GPP (third generation partnership

programme) NGMN (The Next Generation Mobile Networks) IEEE (Institute of

Electrical and Electronics Engineers) CCSA (The China Communications Standards

Association) 5GAIA (5G Applications Industry Array) and AII (Alliance of Industrial

Internet) and a board member of numerous organisations such as GSA (Global Suppliers’

– 71 –Alliance) and ETSI (European Telecommunications Standards Institute). The Group’s

specialists also serve in key roles such as chairman/vice chairman and reporter of leading

international standardisation organisations industry alliances scientific associations and

open-source communities.ENVIRONMENT

The Group implements a low-carbon green strategy and drives sustainable development

through four major aspects: (i) green corporate operation (ii) green supply-chain (iii) green

digital and intelligent bases and (iv) green industry empowerment. For the year ended 31

December 2024 the Group’s total expenditures in environmental treatment and protection

amounted to approximately RMB56.6 million which has been applied in the energy-saving

conversion of equipment at R&D production and administration facilities green landscape

in the plant areas handling of exhaust gas sewage hazardous waste and garbage and green

and low-carbon accreditations. The Group organises training sessions on dual carbon

requirements such as carbon customs tax and also regularly instructs its metal product

manufacturers to conduct carbon emission audit in accordance with the carbon border

adjustment mechanism (CBAM) requirements for the declaration of carbon emission data

under the European Union’s carbon customs tax regime. The Group seeks to enhance

efficiency throughout the production process and reduce energy consumption along the

entire supply chain. It has in place a “dual circulation” model for the circular economy to

optimise and reduce its use of resources help facilitate global transition towards

decarbonisation increase the ratio of product recycling and reuse reduce emission and

discharge of pollutants and lower the rate of incineration and landfill.INSURANCE

The Group has purchased liability insurance for its directors supervisors and senior

employees with a view to procuring timely and proper compensation for any economic loss

incurred by third parties as a result of the performance of duties in office by its directors

supervisors and senior management. For businesses that operate in regions with higher

assessed risk levels the Group has the necessary export insurance and resorts to financing

means to reduce probable loss. The Group also has in place credit insurance to mitigate

customer credit risks. The Group’s employees are entitled to accident insurance business

travel insurance housing allowance retirement and other benefits. In accordance with

relevant regulations of the countries where its employees are located the Group also

participates in social insurance plans organised by the relevant government authorities

under which the Group makes contributions towards each employee’s social insurance fund

in an amount equivalent to a specified percentage of his or her monthly salaries. The

Group’s employees are also entitled to pension insurance and unemployment insurance

schemes managed by local governments.COMPLIANCE WITH LAWS AND REGULATIONS

The Group is a global leading provider of integrated ICT solutions. The laws and

regulations which have a material impact on the business and operations of the Group

include but are not limited to those pertaining to corporations contracts product safety

privacy protection and data compliance intellectual property and other pertinent laws and

regulations of relevant countries and regions and trade rules of relevant international

organisations countries and regions. The Group endeavours to ensure compliance of its

businesses and operations with applicable domestic and international laws and regulations.– 72 –The Group’s Compliance Management Committee monitors the Group’s overall

conformity with compliance laws and regulations which have a material impact on the

Group’s business and operations and reports to the Board. The Group’s Compliance

Management Committee dedicates itself to be responsible for the operation of compliance

management regimes and policy-making relating to areas including export control

compliance compliance in anti-commercial bribery and data compliance.LITIGATION

From time to time the Group may be involved in legal proceedings or other disputes in the

ordinary course of its business. As at the date of this Offering Circular the Group is not

aware of any material legal proceedings investigations claims disputes penalties or

liabilities currently existing or pending against it that may have a material adverse impact

on its business financial condition or results of operations. None of the Issuer nor any

member of the Group is involved in any litigation or arbitration proceedings that are

material in the context of the Bonds nor is the Issuer aware that any such proceedings are

pending or threatened as at the date of this Offering Circular.– 73 –DIRECTORS AND SENIOR MANAGEMENT

DIRECTORS

The following table sets forth key information of the directors of the Issuer as of the date of

this Offering Circular:

Name Age Position

Ms. Fang Rong (方榕). . . . . . . . . 60 Chair and Non-executive Director

Mr. Xu Ziyang (徐子陽) . . . . . . . 52 Executive Director and President

Mr. Yan Junwu (閆俊武) . . . . . . . 56 Non-executive Director

Mr. Zhu Weimin (諸為民) . . . . . . 58 Non-executive Director

Mr. Zhang Hong (張洪). . . . . . . . 46 Non-executive Director

Mr. Zhuang Jiansheng (莊堅勝) . . 59 Independent Non-executive Director

Mr. Wang Qinggang (王清剛). . . . 54 Independent Non-executive Director

Mr. Tsui Kei Pang (徐奇鵬) . . . . . 64 Independent Non-executive Director

Ms. Li Miaona (李妙娜) . . . . . . . 50 Employee Director

The biographies of the directors of the Issuer are set out below.Ms. Fang Rong (方榕) born in 1964 graduated from Nanjing Institute of Posts and

Telecommunications (now known as Nanjing University of Posts and Telecommunications)

in 1987 with a bachelor’s degree in engineering majoring in telecommunications

engineering. From 1987 to 1995 Ms. Fang worked at Wuhan Posts and

Telecommunications and Science Research Institute under the Ministry of Posts and

Telecommunications. She worked with Zhongxingxin controlling shareholder of the Issuer

from 1995 to 1997. The Issuer was incorporated on 11 November 1997 and Ms. Fang

worked with the Issuer from 1997 to 2009 acting as Senior Vice President of the Issuer from

1998 to 2009. She was executive vice president of Zhongxing Development Company

Limited from 2009 to April 2024 and has been director of the company since 2009. From

September 2021 she has been chair of Xiazhi Technology Company Limited. Ms. Fang has

been Non-executive Director of the Issuer since June 2018 and has been Chair of the Issuer

since 31 March 2025. Ms. Fang has many years of operational and management experience

in the telecommunication industry

Mr. Xu Ziyang (徐子陽) born in 1972 graduated from University of Electronic Science and

Technology of China with a bachelor’s degree in engineering majoring in physical

electronics technology in 1994. Mr. Xu joined the Issuer in 1998 and served successively

as head of development department and product general manager of core network regional

MKT general manager general manager of subsidiary and assistant to the President. Mr.Xu has been President of the Issuer since July 2018 and Executive Director of the Issuer

since August 2018. Mr. Xu has many years of operational and management experience in

the telecommunication industry.Mr. Yan Junwu (閆俊武) born in 1968. Mr. Yan was previously named Yan Suoping. He

graduated from Inner Mongolia University in 1989 majoring in electronics and information

systems and further obtained a Master of Engineering degree specialising in general missile

design as well as the title of research fellow in 1992. Mr. Yan joined Beijing Institute of

Astronautical System Engineering under China Academy of Launch Vehicle Technology in

1992 to engage in general missile design and informatisation projects serving successively

as designer team leader and deputy head of the development and planning department of

– 74 –Beijing Institute of Astronautical System Engineering under China Academy of Launch

Vehicle Technology from 1992 to 2009. From 2009 to 2015 he successively served as deputy

head of the planning department and deputy head of the weaponry department of China

Aerospace Science and Technology Corporation. From 2015 to 2017 he served as director

president and deputy secretary of Party Committee of Beijing Shenzhou Aerospace

Software Technology Co. Ltd. From 2017 to 2020 he was vice chairman of China Siwei

Surveying & Mapping Technology Co. Ltd. From 2020 to 2023 he served as director of

China Great Wall Industry Corporation China Siwei Surveying & Mapping Technology

Co. Ltd. and Beijing Shenzhou Aerospace Software Technology Co. Ltd. respectively.Since 2023 he has been deputy head of China Academy of Space Electronics Technology

an indirect shareholder of Zhongxingxin. Mr. Yan has extensive experience in the

electronics industry in both professional and management capacities.Mr. Zhu Weimin (諸為民) born in 1966 graduated from the Department of Electronic

Engineering of Shanghai Jiaotong University in 1988 with a bachelor’s degree in

engineering majoring in electronic engineering and obtained an MBA degree from China

Europe International Business School in Shanghai in 2003. Mr. Zhu served successively as a

technician and deputy head of Suzhou Dongfeng Communication Equipment Factory

Research Institute from 1988 to 1991; research engineer and deputy director of the

development department of Shenzhen Zhongxing Semiconductor Co. Ltd. from 1991 to

1993; research engineer of Zhongxingxin the controlling shareholder of the Issuer and

head of Nanjing Research Institute of Zhongxingxin from 1993 to 1997.. The Issuer was

incorporated on 11 November 1997 and Mr. Zhu served as Director and Deputy General

Manager of the Issuer from 1997 to 2000; deputy general manager of Zhongxingxin from

2002 to 2003; general manager of Shenzhen Changfei Investment Co. Ltd. from 2004 to

2013; and director of Shenzhen Jufei Optoelectronics Co. Ltd. (a company listed on the

Shenzhen Stock Exchange) from 2009 to 2015. Mr. Zhu served as director of Shenzhen

Techaser Technologies Co. Ltd. from 2008 to 2023 (concurrently as advisor from 2013 to

2018); and chairman/director of Shenzhen Zhongxing International Investment Co. Ltd.

and its certain subsidiaries since 2018. At present he is concurrently serving as director of

Zhongxingxin Shenzhen Zhongxing WXT Equipment Company Limited Shenzhen Xinyu

Tengyue Electronics Co. Ltd. and Hainan Xinghang Technology Company Limited. Mr.Zhu has been Non-executive Director of the Issuer since June 2018. Mr. Zhu has extensive

experience in management and operations.Mr. Zhang Hong (張洪) born in 1979 graduated from Hubei University with a bachelor’s

degree in Management in 2001 majoring in Accounting. In 2019 he obtained a master’s

degree in Public Administration from Zhongnan University of Economics and Law. He

holds the title of senior accountant and qualifications as a Certified Internal Auditor and an

International Certified Management Accountant. He has been included in the list of

Top-tier Accounting Professionals of Hubei Province. From 2001 to 2012 Mr. Zhang

worked with Hubei Sanjiang Space Wan Feng Technology Development Co. Ltd. as a

financial personnel holding successively the positions of accounting clerk at the financial

division deputy head of accounting division head of accounting division head of audit

division director of factory office head of financial department and deputy chief

accountant. From 2012 to 2015 he worked successively as assistant to head of institute

and head of financial department and chief accountant of Aerospace Heavy Industry Co.Ltd. From 2015 to 2018 he was deputy head of financial department of China Aerospace

Sanjiang Group Co. Ltd. From 2018 to 2023 he was chief accountant chief legal adviser

and chief compliance officer (CCO) of Henan Aerospace Industrial Co. Ltd. Since 2023 he

– 75 –has been chief accountant chief legal adviser and chief compliance officer (CCO) of

Shenzhen Aerospace Industrial Technology Research Institute Limited and concurrently

director and chief accountant of CASIC Shenzhen (Group) Company Limited. He has been

supervisor of Zhongxingxin since July 2024 and Non-executive Director of the Issuer since

June 2024. Mr. Zhang has many years of experience in management and operations.Mr. Zhuang Jiansheng (莊堅勝) born in 1965 graduated from East China University of

Political Science and Law with a bachelor’s degree in law in 1988 and obtained a master’s

degree in international and economic law from the University of International Business and

Economics in 1991. Mr. Zhuang has been admitted as a PRC Attorney. Mr. Zhuang has

worked in Shanghai WGQ Free Trade Zone Development Corporation

PricewaterhouseCoopers Consulting Firm and Baker & McKenzie LLP in the United

States. Mr. Zhuang has been the advisory partner of Shanghai Huiye Law Firm with respect

to the business of trade compliance and customs since January 2016. He has been

Independent Non-executive Director of the Issuer since June 2020. Mr. Zhuang has

extensive experience in legal and practical matters in areas like international trade

compliance corporate regulatory matters customs and tax law.Mr. Wang Qinggang (王清剛) born in 1970. Mr. Wang was previously named Wang Yong.He graduated from Huazhong Agricultural University with a bachelor’s degree in

Economics in 1993 majoring in Economic Management. He received a master’s degree in

Economics from Zhongnan University of Finance (renamed Zhongnan University of

Economics and Law in 2000) in 1996 followed by a PHD in Management at Zhongnan

University of Economics and Law in 2004. During 2004–2007 he undertook post-doctoral

research in business administration at Xiamen University. He holds the qualification of a

PRC certified accountant (non-practising). Mr. Wang has been on the faculty of Zhongnan

University of Economics and Law since 1996 and is currently a professor/tutor to doctoral

students at the School of Accounting of the university. Mr. Wang has been an independent

director of Wuhan Xingtu Xinke Electronics Co. Ltd. (a company listed on the Shanghai

Stock Exchange) Wuhan SZY Biotech Joint Stock Co. Ltd. (a non-listed company) and

Anhui Hongyu Wuzhou Medical Manufacturing Co. Ltd. (a company listed on the

Shenzhen Stock Exchange) since March 2019 January 2021 and February 2023

respectively. He has previously served as independent director at Wuhan Sante Cableway

Group Co. Ltd. (a company listed on the Shenzhen Stock Exchange) Jinhui Liquor Co.Ltd. (a company listed on the Shanghai Stock Exchange) and Wuhan Mindsemi Company

Limited (a non-listed company). Mr. Wang has been Independent Non-executive Director

of the Issuer since June 2024. He has a strong academic and professional background as

well as extensive experience in accounting and finance.Mr. Tsui Kei Pang (徐奇鵬) born in 1960 graduated from The University of Hong Kong

with a LLB degree and a Master of Laws degree in 1990 and 1997 respectively. Mr. Tsui

has been a practicing solicitor of Hong Kong for more than 30 years working with Gallant

Y T Ho & Co from 1993 to 2018 and since 2018 Messrs. Anthony Siu & Co where he is

currently a partner. Mr. Tsui has been an independent non-executive director of CIMC

Enric Holdings Limited (a company listed on the Stock Exchange of Hong Kong) since

November 2009. He is also an arbitrator at China International Economic and Trade

Arbitration Commission South China Branch (Shenzhen International Arbitration

Committee) Hainan International Arbitration Court. and Huizhou Arbitration

Committee respectively an honorary legal adviser of The Hong Kong Real Estate

Association and Hong Kong Association for Testing Inspection and Certification Ltd.– 76 –respectively and the vice president of Association of China-Appointed Attesting Officers

Limited. He has been Independent Non-executive Director of the Issuer since June 2024.Mr. Tsui has strong professional qualifications and extensive experience in the legal sector.Ms. Li Miaona (李妙娜) born in 1974 graduated from Renmin University of China in 1997

with a bachelor’s degree in History majoring in Archival Science. Ms. Li joined the Issuer

in 2000 and worked with the Quality Section of the Network Business Department and the

Editorial of ZTE Newsletter under the Human Resources Department from 2000 to 2005.Ms. Li was Head of the Shenzhen Platform of the Administrative Department of the Issuer

from 2005 to 2010. She worked at the Cloud Service Centre under the financial organisation

from 2010 to 2017. She was Principal of the Administrative Platform under the

Administrative Department Principal of Operations and Management of Administrative

Properties and Head of the Administrative Properties Staff Service Management

Department of the Issuer from 2017 to July 2021. Since July 2021 she has been chairman

of the Trade Union and Head of the Office of Trade Unions Directly Affiliated with the

Headquarters of the Issuer. She is concurrently the chairman of Shenzhen Zhongxing Yihe

Investment and Development Company Limited. She has been Supervisor of the Issuer

from March 2022 to April 2025 and Employee Director of the Issuer since May 2025. Ms. Li

has extensive management and operational experience.SENIOR MANAGEMENT

The following table sets forth key information of the senior management of the Issuer as of

the date of this Offering Circular:

Name Age Position

Mr. Xu Ziyang (徐子陽) . . . . . . . 52 Executive Director and President

Mr. Wang Xiyu (王喜瑜) . . . . . . . 50 Executive Vice President

Ms. Li Ying (李瑩) . . . . . . . . . . . 47 Executive Vice President and Chief

Financial Officer

Mr. Xie Junshi (謝峻石) . . . . . . . 49 Executive Vice President

Mr. Ding Jianzhong (丁建中) . . . . 48 Secretary to the Board/Company Secretary

The biographies of the senior management of the Issuer are set out below.Mr. Xu Ziyang (徐子陽). Please refer to the section headed “Directors” for his biography.Mr. Wang Xiyu (王喜瑜) born in 1974 graduated from Northern Jiaotong University (now

renamed as “Beijing Jiaotong University”) in 1995 with a bachelor’s degree in engineering

majoring in power traction and transmission control and further obtained a master’s

degree in engineering from Northern Jiaotong University in 1998 majoring in railway

traction electrification and automation. Mr. Wang joined the Issuer in 1998 and served

successively as engineer project manager head of development division and deputy general

manager at the CDMA Department of the Issuer from 1998 to 2007. From 2008 to 2016 he

had been Head of the Wireless Structure Division and Deputy Head/Head of the Wireless

Research Institute at the Wireless Department of the Issuer. He was Deputy CTO and

Assistant to the President of the Issuer from 2016 to July 2018. Mr. Wang has been

Executive Vice President of the Issuer since July 2018. He has many years of operational

and management experience in telecommunications industry.– 77 –Ms. Li Ying (李瑩) born in 1978 graduated from Xi’an Jiaotong University in 1999 with a

bachelor’s degree in management and a bachelor’s degree in engineering and further

obtained a master’s degree in management majoring in management science and engineering

from Xi’an Jiaotong University in 2002. Ms. Li joined the Issuer in 2002 and acted

successively as Principal of the Cost and Strategy Office Head of the Logistics Finance

Department Head of the Production Research Finance Department Deputy Head of the

Finance Management Department and Deputy Chief of the Finance Management

Department from 2002 to January 2018. From January to July 2018 she was Chief of

Finance Management Department. She has been Executive Vice President and Chief

Financial Officer of the Issuer since July 2018. Ms. Li has many years of experience in

finance and the operation and management of the telecommunication industry.Mr. Xie Junshi (謝峻石) born in 1975 graduated from Tsinghua University in 1998 with a

bachelor’s degree in engineering majoring in engineering mechanics and further obtained a

master’s degree in engineering majoring in fluid mechanics in 2001 also from Tsinghua

University. Mr. Xie joined the Issuer in 2001 and had successively served as the Issuer’s

Technology Manager (International Markets) Regional Business Technology Manager

(Europe and South Asia) and Regional Deputy General Manager (Europe and North

America) and Regional Deputy General Manager (Europe) from 2001 to 2013. From 2014

to July 2018 he was the Issuer’s General Manager (Europe and America) for MKT and

Solutions. He was Senior Vice President and Chief Operating Officer from July 2018 to

September 2019. Since September 2019 he has been Executive Vice President and Chief

Operating Officer of the Issuer. Mr. Xie has many years of experience in the operation and

management of the telecommunication industry.Mr. Ding Jianzhong (丁建中) born in 1976 holds a master’s degree in management and is a

certified public accountant of the PRC and an Associate Member of China Certified Tax

Agents Association. Mr. Ding joined the Issuer in 2003. From 2003 to March 2019 he had

served successively as: Financial Principal of the Business Department Principal of the

Cost and Strategy Office Financial Principal of the Engineering Service Operation

Department Deputy Head of the Engineering Business Department Deputy Chief of the

Business Centre Head of Financial Division II under the Financial Management

Department Head of Supply Chain Procurement Division III and Chief of Work

Outsourcing Division under the Engineering Service Operation Department. He has been

Chief of the Securities Department under the Finance Department of the Issuer since April

2019 Secretary to the Board of the Issuer since July 2019 and Company Secretary since

November 2019. Mr. Ding has many years of experience in finance and operation and

management in the telecommunication industry.– 78 –SUBSTANTIAL SHAREHOLDERS’ AND DIRECTORS’ INTERESTS

SUBSTANTIAL SHAREHOLDERS’ INTERESTS

As at 31 December 2024 as far as is known to any Directors the following shareholders

had interests or short positions in the Ordinary Shares or underlying shares which shall be

disclosed to the Issuer under the provisions of Divisions 2 and 3 of Part XV of the Securities

and Futures Ordinance (the “SFO”) or recorded in the register required to be kept under

section 336 of the SFO:

Shareholding as

an approximate

percentage of(1):

Number of Total share Class shares

Name Capacity shares held capital

Zhongxingxin . . . . . . . . . . Beneficial owner 958940400 20.05% (L) 23.81% (L)

A shares (L)

Zhongxing WXT. . . . . . . . Interests of corporate 958940400 20.05% (L) 23.81% (L)

controlled by you A shares (L)

Xi’an Microelectronics . . . Interests of corporate 958940400 20.05% (L) 23.81% (L)

controlled by you A shares (L)

China Aerospace Electronics Interests of corporate 958940400 20.05% (L) 23.81% (L)

Technology Research controlled by you A shares (L)

Institute . . . . . . . . . . . .China Aerospace Science and Interests of corporate 958940400 20.05% (L) 23.81% (L)

Technology Corporation controlled by you A shares (L)

JPMorgan Chase & Co. . . . Beneficial owner 40433384 0.85% (L) 5.35% (L)

investment manager H shares (L) 0.20% (S) 1.27% (S)

holder of assured 9601588 0.34% (P) 2.12% (P)

entitlements to shares H shares (S)

approved lending agent 16035781

H shares (P)

Capital Research and Investment manager 38410000 0.80% (L) 5.08% (L)

Management Company . H shares (L)

(L) — Long position; (S) — Short position; (P) — Lending pool

Note:

(1) Shareholdings as percentage of total share capital and relevant class of shares was calculated on the basis

of the Issuer’s total share capital of 4783534887 shares comprising 4028032353 A shares and

755502534 H shares as at 31 December 2024.

– 79 –DIRECTORS’ AND SENIOR MANAGEMENT’S INTERESTS

As at 31 December 2024 the interests of the Issuer’s current directors supervisors and

senior management and those who vacated office during the year ended 31 December 2024

in the Issuer’s shares that is required to be recorded in the register to be kept under Section

352 of the SFO or otherwise notified to the Issuer and the Hong Kong Stock Exchange

pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers as set

out in Appendix C3 to the Hong Kong Listing Rules were as follows:

Number of Number of Number of Number of

shares shares shares shares As a percentage of:

Title (Status of held at the acquired disposed held at the Total

office as at 31 beginning during the of during end of share Class A

Name December 2024) of the year year the year year capital shares

Xu Ziyang . . . . . . . Director and 168000 — — 168000 0.0035% 0.0042%

President

(Incumbent)

Xie Daxiong(3) . . . . Chairman of the 279103 — 69700 209403 0.0044% 0.0052%

Supervisory

Committee

(Incumbent)

Xia Xiaoyue . . . . . . Supervisor 50927 — — 50927 0.0011% 0.0013%

(Incumbent)

Wang Xiyu . . . . . . Executive Vice 139034 — — 139034 0.0029% 0.0035%

President

(Incumbent)

Li Ying . . . . . . . . . Executive Vice 95500 — — 95500 0.0020% 0.0024%

President and

Chief Financial

Officer

(Incumbent)

Xie Junshi . . . . . . . Executive Vice 112468 — — 112468 0.0024% 0.0028%

President

(Incumbent)

Ding Jianzhong . . . Secretary to the 33160 — — 33160 0.0007% 0.0008%

Board of

Directors

(Incumbent)

Notes:

(1) All shareholdings in the Issuer held by the Directors Supervisors and senior management of the Issuer

were A shares and no H shares were held by them.

(2) The Directors Supervisors and senior management of the Issuer did not hold any equity interests in the

subsidiaries of the Company.

(3) During the year ended 31 December 2024 Mr. Xie Daxiong disposed of 69700 A shares in the Issuer.

– 80 –DESCRIPTION OF THE SHARES

The following information is a summary of certain provisions of the Articles of Association

and certain other information concerning the Issuer. These statements are only a summary and

qualified in their entirety by reference to the full Articles of Association and Company Law of

the People’s Republic of China. Any provision of the Articles of Association may be varied by

special resolution passed at a general meeting of shareholders of the Issuer as approved by the

relevant competent authority according to the applicable laws and rules.GENERAL

The Issuer was established as a joint stock limited company in the PRC on 11 November

1997 in accordance with the provisions set out in the Company Law. The A Shares of the

Issuer were listed on The Shenzhen Stock Exchange on 18 November 1997 and the H Shares

of the Issuer were listed on the Hong Kong Stock Exchange on 9 December 2004.SHARE CAPITAL

As of the date of this Offering Circular the total share capital of the Issuer was

4783534887 shares with a par value of RMB1.00 each which can be categorised as

follows:

Approximate

percentage of the

Description of Shares Number of shares total share capital

Domestic shares (A Shares) . . . . . . . . . . . . . . 4028032353 84.2%

Overseas listed foreign shares (H Shares). . . . . 755502534 15.8%

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4783534887 100.0%

RANKING

Both holders of H Shares and A Shares are regarded as holders of ordinary shares under the

Articles of Association and shall enjoy and bear the same rights and obligations.ISSUER OF SHARES

The Issuer may based on its operational and development requirements increase its capital

in accordance with the relevant provisions of the Articles of Association. The Issuer may

increase its capital by the following methods: (i) by public share offering (ii) by non-public

share offering; (iii) by allotting bonus shares to existing shareholders; (iv) by capital

increase by conversion from common reserve funds; and (v) by any other means permitted

by laws and administrative regulations as well as upon the approval of the CSRC.The increase of capital of the Issuer by way of issuing new shares shall be carried out in

accordance with the procedures provided for in relevant laws and administrative regulations

and after having been approved in accordance with the Articles of Association.DIVIDENDS

According to the Articles of Association the accumulated profit to be distributed in cash

for any three consecutive years shall not be less than 30% of the average annual

distributable profit realised in the three years provided that the annual distributable profits

– 81 –of the Issuer (namely profits after tax of the Company after making up for losses and

allocations for reserve funds) are positive in value and such distributions are in compliance

with the prevailing laws and regulations. The annual dividends shall be passed by

shareholders in general meeting and the amount of dividends to be distributed shall be

proposed by the board of directors of the Issuer.The Issuer shall appoint recipient agents on behalf of the shareholders of overseas listed

foreign shares. Recipient agents shall receive on behalf of the relevant shareholders

dividends distributed and other monies payable by the Issuer in respect of the overseas

listed foreign shares. The receiving agent appointed by the Issuer shall comply with the laws

and the requirements of the stock exchange where the shares of the Issuer are listed. The

receiving agent appointed by the Issuer on behalf of holders of H Shares shall be a trust

company registered in accordance with the Trustee Ordinance of Hong Kong.Dividends or other distributions of the Issuer shall be declared and calculated in Renminbi.Where the Issuer makes payment to holders of foreign investment shares in foreign

currency the foreign currency shall be arranged in accordance with the relevant state

foreign exchange regulations. When distributing dividends the Issuer shall withhold on

behalf of the shareholders the tax payable on dividend income in accordance with PRC tax

law.SHAREHOLDERS’ GENERAL MEETINGS

Shareholders’ general meetings shall be divided into annual general meetings and

extraordinary general meetings. Shareholders’ general meetings shall be convened by the

board of directors. Annual general meetings shall be convened once every year and shall be

held within six months after the end of the preceding accounting year.Upon the occurrence of any of the following events the board of directors shall convene an

extraordinary general meeting within two months thereof:

(i) the number of directors falls short of the minimum number required by the Company

Law or is less than two-thirds of the number required by the Articles of Association;

(ii) the unrecovered losses of the Company amount to one-third of the total amount of its

paid-up share capital;

(iii) upon request by shareholder(s) holding not less than 10% of the Issuer’s issued and

outstanding voting shares request(s) in writing for an extraordinary general meeting to

be convened;

(iv) it is deemed necessary by the board of directors or the audit committee so requests;

(v) upon request by a majority of the independent non-executive directors of the Issuer;

and

(vi) any other circumstances required by the laws administrative regulations departmental

rules and the Articles of Association.When the Issuer convenes an annual general meeting a written notice to notify all

registered shareholders must be given no later than 20 days before the meeting; when the

Issuer convenes an extraordinary general meeting a written notice to notify all registered

– 82 –shareholders must be given no later than 15 days before the meeting. Such notice shall

contain the matters to be considered at the meeting as well as the date and venue of the

meeting.When the general meeting is held the shareholders alone or in aggregate holding more than

1% of the Issuer’s shares shall have the right to put forward a proposal in writing to the

Issuer 10 days prior to the general meeting and the Issuer shall incorporate those matters in

the proposal which fall within the scope of the duties of the general meeting into the agenda

of such meeting.– 83 –TERMS AND CONDITIONS OF THE BONDS

The following subject to completion and amendment and other than the words in italics is the

text of the Terms and Conditions of the Bonds which will appear on the reverse of each of the

definitive certificates evidencing the Bonds:

The issue of RMB3584 million in aggregate principal amount of U.S. dollar settled zero

coupon convertible bonds due 2030 (the “Bonds” which term shall include unless the

context requires otherwise any further bonds issued in accordance with Condition 15

(Further Issues) and consolidated and forming a single series therewith) of ZTE

Corporation (中興通訊股份有限公司) (the “Issuer”) and the right of conversion into H

Shares (as defined in Condition 5.1.5 (Meaning of “Shares”)) of the Issuer were authorised

by the general mandate granted to the board of directors of the Issuer by the shareholders

of the Issuer at the annual general meeting of the Issuer held on 28 March 2025 and

resolutions of the board of directors of the Issuer passed on 27 July 2025. The Bonds areconstituted by a trust deed (as amended and/or supplemented from time to time the “TrustDeed”) dated on or about 5 August 2025 (the “Issue Date”) and made between the Issuer

and China Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公

司) (the “Trustee” which term shall where the context so permits include all successor

trustee and other persons for the time being acting as trustee or trustees under the Trust

Deed) as trustee for itself and the holders of the Bonds. The Issuer has entered into a

paying conversion and transfer agency agreement (as amended and/or supplemented from

time to time the “Agency Agreement”) dated on or about 5 August 2025 with the Trustee

China Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公司)

as principal paying agent (the “Principal Paying Agent” which expression shall include any

additional or successor principal paying agent appointed from time to time in connectionwith the Bonds) China Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公司) as conversion agent (the “Conversion Agent” which expression shall

include any successor conversion agent appointed from time to time in connection with the

Bonds and together with the Principal Paying Agent the “Principal Agent”) China

Construction Bank (Asia) Corporation Limited (中國建設銀行（亞洲）股份有限公司) as

registrar (the “Registrar” which expression shall include any successor registrar appointed

from time to time in connection with the Bonds) and transfer agent (the “Transfer Agent”

which expression shall include any additional or successor transfer agent appointed from

time to time in connection with the Bonds) and the other paying agents transfer agents and

conversion agents appointed under it (each a “Paying Agent” a “Transfer Agent” or a

“Conversion Agent” (as applicable) and together with the Registrar and the Principal Agent

the “Agents”) relating to the Bonds. For the avoidance of doubt references to the “PayingAgents” the “Transfer Agents” or as the case may be the “Conversion Agents” each

include the Principal Agent. References to the “Principal Agent” the “Registrar” and the

“Agents” below are references to the principal agent the registrar and the agents for the

time being for the Bonds. These terms and conditions (these “Conditions”) include

summaries of and are subject to the detailed provisions of the Trust Deed. Copies of the

Trust Deed and of the Agency Agreement (i) are available for inspection at all reasonable

times during usual business hours (being between 9.00 a.m. (Hong Kong time) and 3.00 p.m.(Hong Kong time) Monday to Friday except for public holidays) at the specified office of

the Principal Agent being at the date of the Trust Deed at 3/F CCB Tower 3 Connaught

Road Central Central Hong Kong and (ii) may be provided by email to any Bondholder

in each case following prior written request and proof of holding and identity satisfactory

to the Principal Agent. The Bondholders (as defined in Condition 1.3 (Title)) are entitled to

– 84 –the benefit of are bound by and are deemed to have notice of all the provisions of the

Trust Deed and are deemed to have notice of those provisions of the Agency Agreement

applicable to them.All capitalised terms that are not defined in these Conditions will have the meanings given

to them in the Trust Deed.

1 STATUS; FORM DENOMINATION AND TITLE

1.1 Status

The Bonds constitute direct unsubordinated unconditional and (subject to the

provisions of Condition 3.1 (Negative Pledge)) unsecured obligations of the Issuer

and shall at all times rank pari passu and without any preference or priority

among themselves. The payment obligations of the Issuer under the Bonds shall

save for such exceptions as may be provided by mandatory provisions of

applicable law and subject to Condition 3.1 (Negative Pledge) at all times rank at

least equally with all of its other present and future direct unsubordinated

unconditional and unsecured obligations.

1.2 Form and Denomination

The Bonds are issued in registered form in the specified denomination of

RMB2000000 each and integral multiples of RMB1000000 in excess thereof

(each an “Authorised Denomination”). A bond certificate (each a “Certificate”)

will be issued to each Bondholder in respect of its registered holding of Bonds.Each Certificate will be numbered serially with an identifying number which will

be recorded on the relevant Certificate and in the register of Bondholders (the

“Register”) which the Issuer will procure to be kept by the Registrar.Upon issue the Bonds will be represented by a global certificate (the “GlobalCertificate”) registered in the name of a nominee of and deposited with a common

depositary for Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking

S.A. (“Clearstream”). The Conditions are modified by certain provisions contained

in the Global Certificate.Except in the limited circumstances described in the Global Certificate owners of

interests in Bonds represented by the Global Certificate will not be entitled to receive

definitive Certificates in respect of their individual holdings of Bonds. The Bonds are

not issuable in bearer form.

1.3 Title

Title to the Bonds passes only by transfer and registration in the Register as

described in Condition 2 (Registration and Transfers of Bonds; Issue of

Certificates). The holder of any Bond will (except as otherwise required by law

or as ordered by a court of competent jurisdiction) be treated as its absolute

owner for all purposes (whether or not it is overdue and regardless of any notice

of ownership trust or any interest in it or any writing on or the theft or loss of

the Certificate issued in respect of it) and no person will be liable for so treating

the holder. In these Conditions “Bondholder” and (in relation to a Bond) “holder”

means the person in whose name a Bond is registered.– 85 –2 REGISTRATION AND TRANSFERS OF BONDS; ISSUE OF CERTIFICATES

2.1 Register

The Issuer will cause the Register to be kept at the specified office of the Registrar

outside the United Kingdom and Hong Kong and in accordance with the terms of

the Agency Agreement on which shall be entered the names and addresses of the

holders of the Bonds and the particulars of the Bonds held by them and of all

transfers redemptions and conversions of the Bonds. Each Bondholder shall be

entitled to receive only one Certificate in respect of its entire holding of Bonds.

2.2 Transfers

Subject to Conditions 2.5 (Restricted Transfer Periods) and 2.6 (Regulations) and

the terms of the Agency Agreement a Bond may be transferred in whole or in part

in an Authorised Denomination by delivery of the Certificate issued in respect of

that Bond with the form of transfer on the back duly completed and signed by the

holder or his attorney duly authorised in writing to the specified office of the

Registrar or of any of the Transfer Agents and any other evidence as the Registrar

or any Transfer Agent may require. No transfer of a Bond will be valid or

effective unless and until entered on the Register. A Bond may be registered only

in the name of and transferred only to a named person.Transfers of interests in the Bonds evidenced by the Global Certificate will be

effected in accordance with the rules and procedures of the relevant clearing systems.

2.3 Delivery of New Certificates

2.3.1 Each new Certificate to be issued upon a transfer of Bonds will within seven

business days of receipt by the Registrar or as the case may be any Transfer

Agent of the original Certificate and the form of transfer duly completed and

signed be made available for collection at the specified office of the Registrar

or such Transfer Agent or if so requested in the form of transfer be mailed

by uninsured mail at the risk of the holder entitled to the Bonds (but free of

charge to the holder and at the Issuer’s expense) to the address specified in

the form of transfer. The form of transfer is available at the specified office

of the Registrar and each Transfer Agent.Except in the limited circumstances described in the Global Certificate the

Bonds will only be issued to the Bondholders in book-entry form and owners of

interests in the Bonds will not be entitled to receive physical delivery of

Certificates.

2.3.2 Where only part of a principal amount of the Bonds (being that of one or

more Bonds) in respect of which a Certificate is issued is to be transferred

converted redeemed or repurchased a new Certificate in respect of the

Bonds not so transferred converted redeemed or repurchased will within

seven business days of delivery of the original Certificate to the Registrar or

any Transfer Agent be made available for collection at the specified office of

the Registrar or such Transfer Agent or if so requested in the form of

transfer be mailed by uninsured mail at the risk of the holder of the Bonds

– 86 –not so transferred converted redeemed or repurchased (but free of charge to

the holder and at the Issuer’s expense) to the address of such holder

appearing on the Register.

2.3.3 For the purposes of this Condition 2.3 (Delivery of New Certificates)

“business day” shall mean a day other than a Saturday or Sunday or public

holiday on which commercial banks are generally open for business in the

city in which the specified office of the Registrar (if a Certificate is deposited

with it in connection with a transfer or conversion) or the Agent with whom a

Certificate is deposited in connection with a transfer or conversion is

located.

2.4 Formalities Free of Charge

Registration of a transfer of Bonds and issuance of new Certificates will be

effected without charge subject to (i) the person making such application for

transfer paying or procuring the payment of any taxes duties and other

governmental charges in connection therewith (ii) the Registrar or the relevant

Transfer Agent (as the case may be) being satisfied with the documents of title

and/or identity of the person making the application and (iii) the Registrar or the

relevant Transfer Agent (as the case may be) being satisfied that the Regulations

(as defined in Condition 2.6 (Regulations) below) have been complied with.

2.5 Restricted Transfer Periods

No Bondholder may require the transfer of a Bond to be registered (i) during the

period of seven days ending on (and including) the dates for payment of any

amount pursuant to these Conditions (including any date of redemption pursuant

to Condition 7.2 (Redemption at the Option of the Issuer) and Condition 7.3

(Redemption for Taxation Reasons)); (ii) after a Conversion Notice (as defined in

Condition 5.2.1 (Conversion Notice)) has been delivered with respect to such Bond

or (iii) after a Put Option Notice (as defined in Condition 7.4 (Redemption at the

Option of the Bondholders)) has been deposited in respect of such Bond (iv) after a

Relevant Event Put Exercise Notice (as defined in Condition 7.5 (Redemption for

Relevant Events)) has been deposited in respect of such Bond each such period

being a “Restricted Transfer Period”.

2.6 Regulations

All transfers of Bonds and entries on the Register will be made subject to the

detailed regulations concerning transfer of Bonds the initial form of which is

scheduled to the Agency Agreement (the “Regulations”). The Regulations may be

changed by the Issuer with the prior written approval of the Trustee and the

Registrar or by the Registrar with the prior written approval of the Trustee. A

copy of the current Regulations will be made available (free of charge to the

Bondholder and at the Issuer’s expense) by the Registrar to any Bondholder

following written request and satisfactory proof of holding and identity and is

available for inspection following written request and proof of holding and

identity satisfactory to the Registrar at all reasonable times during normal

– 87 –business hours (being between 9.00 a.m. (Hong Kong time) and 3.00 p.m. (Hong

Kong time) Monday to Friday except for public holidays) at the specified office of

the Registrar.

3 COVENANTS

3.1 Negative Pledge

So long as any Bond remains outstanding (as defined in the Trust Deed) the

Issuer will not create or permit to subsist and the Issuer will procure that no

Subsidiary (as defined below) will create or have outstanding any mortgage

charge pledge lien or other form of encumbrance or security interest upon the

whole or any part of its undertaking assets or revenues (including any uncalled

capital) present or future to secure any Relevant Indebtedness (as defined below)

or to secure any guarantee or indemnity in respect of any Relevant Indebtedness

unless at the same time or prior thereto according to the Bonds the same security

as is created or subsisting to secure any such Relevant Indebtedness guarantee or

indemnity or such other security as shall be approved by an Extraordinary

Resolution (as defined in the Trust Deed) of the Bondholders.

3.2 Undertakings Relating to Foreign Debt Registration

The Issuer undertakes that it will (i) within 15 Registration Business Days after

the Issue Date register or cause to be registered with SAFE the Bonds (the

“Foreign Debt Registration”) pursuant to the Administrative Measures for

Foreign Debt Registration (外債登記管理辦法) and its operating guidelineseffective as of 13 May 2013 as amended from time to time (the “Foreign DebtRegistration Measures”) and if applicable the Circular of the People’s Bank of

China on Issues Concerning the Overall Macro Prudential Management System

for Cross-border Financing (中國人民銀行關於全口徑跨境融資宏觀審慎管理有關

事宜的通知) (the “Cross-Border Financing Circular”) (ii) use its best endeavours

to complete the Foreign Debt Registration and obtain a registration record from

SAFE on or before the Registration Deadline and (iii) comply with all applicable

PRC laws and regulations in relation to the Bonds including but not limited to

the Foreign Debt Registration Measures the Cross-Border Financing Circular

and any implementing measures promulgated thereunder from time to time.

3.3 Notification to NDRC

The Issuer undertakes that it will within the relevant prescribed timeframes after

the Issue Date file or cause to be filed with the NDRC the requisite information

and documents in respect of the Bonds and comply with other reporting

obligations in accordance with the Administrative Measures for the Review and

Registration of Medium- and Long-Term Foreign Debts of Enterprises (企業中長

期外債審核登記管理辦法（國家發展和改革委員會令第56號）) (the “Order 56”)

issued by the NDRC and effective from 10 February 2023 and any

implementation rules reports certificates approvals or guidelines as issued by

the NDRC from time to time including but not limited to the Initial NDRC

Post-Issuance Filing (as defined below).– 88 –3.4 CSRC Post-Issuance Filings

The Issuer undertakes to file or cause to be filed with the CSRC (as defined below)

within the relevant prescribed timeframes after the Issue Date the requisite

information and documents in respect of the Bonds in accordance with the CSRC

Filing Rules (as defined below) (the “CSRC Post-Issuance Filings” which term for

the avoidance of doubt includes the Initial CSRC Post-Issuance Filing (as defined

below)) and comply with the continuing obligations under the CSRC Filing Rules

and any implementation rules as issued by the CSRC from time to time.

3.5 Notification of Submission of the Initial NDRC Post-Issuance Filing and the Initial

CSRC Post-Issuance Filing and the completion of the Foreign Debt Registration

The Issuer shall:

3.5.1 file or cause to be filed (i) the Initial NDRC Post-Issuance Filing with the

NDRC or its competent local counterpart of the information and documents

relating to the issue of the Bonds that are required to be filed in accordance

with Order 56 within ten Registration Business Days after the Issue Date (the

“Initial NDRC Post-Issuance Filing”) and (ii) the CSRC Filing Report and

other requisite information and documents in respect of the Bonds that are

required to be filed with the CSRC within three Registration Business Daysafter the Issue Date in accordance with the CSRC Filing Rules (the “InitialCSRC Post-Issuance Filing”); and

3.5.2 on or before the Registration Deadline and within ten Registration Business

Days after the latest of (i) the submission of the Initial NDRC Post-Issuance

Reporting (ii) the submission of the Initial CSRC Post-Issuance Filing and

(iii) receipt of the registration certificate from SAFE (or any other document

evidencing the completion of the Foreign Debt Registration issued by

SAFE) provide the Trustee with (A) a certificate (substantially in the form

scheduled to the Trust Deed) in English signed by an Authorised Signatory

(as defined in the Trust Deed) confirming the submission of the Initial

NDRC Post-Issuance Reporting and the Initial CSRC Post-Issuance Filing

the completion of the Foreign Debt Registration; and (B) copies of the

relevant documents evidencing the submission of the Initial NDRC

Post-Issuance Reporting and the Initial CSRC Post-Issuance Filing and the

completion of Foreign Debt Registration each certified in English as a true

and complete copy of the original by an Authorised Signatory (the items

specified in (A) and (B) together the “Registration Documents”). In addition

the Issuer shall within ten Registration Business Days after the Registration

Documents are delivered to the Trustee give notice to the Bondholders (in

accordance with Condition 16 (Notices)) confirming the submission of the

Initial NDRC Post-Issuance Reporting and the Initial CSRC Post-Issuance

Filing and the completion of the Foreign Debt Registration.– 89 –The Trustee shall have no obligation or duty to monitor or assist with or ensure

the Initial NDRC Post-Issuance Filing or the Initial CSRC Post-Issuance Filing is

submitted or the Foreign Debt Registration is submitted or completed within the

timeframe specified in Condition 3.2 (Undertakings Relating to Foreign Debt

Registration) Condition 3.3 (Notification to NDRC) and Condition 3.4 (CSRC

Post-Issuance Filings) respectively or to verify the accuracy validity and/or

genuineness of any documents in relation to or in connection with the Initial

NDRC Post-Issuance Filing the Initial CSRC Post-Issuance Filing and/or the

Foreign Debt Registration and/or the Registration Documents or to translate or

procure the translation into English of the documents in relation to or in

connection with the Initial NDRC Post-Issuance Filing the Initial CSRC

Post-Issuance Filing or the Foreign Debt Registration or to give notice to the

Bondholders confirming the completion of the Initial NDRC Post-Issuance

Filing the Initial CSRC Post-Issuance Filing and the Foreign Debt Registration

and shall not be liable to Bondholders or any other person for not doing so.

3.6 Financial Statements

So long as any Bond remains outstanding the Issuer shall provide (A) a

Compliance Certificate (on which the Trustee may rely conclusively as to such

compliance) within 14 days of a request by the Trustee and at the time of the

provision of the Audited Financial Reports; (B) as soon as practicable after their

date of publication and in any event not more than 120 days after the end of each

Relevant Period a copy of the Audited Financial Reports (audited by a nationally

recognised firm of independent accountants) prepared and presented in

accordance with PRC Accounting Standards; and (C) as soon as practicable

after their date of publication and in any event not more than 90 days after the

end of each Relevant Period a copy of the Unaudited Financial Reports prepared

and presented on a basis consistent with the Audited Financial Reports and if any

such financial reports referred to in this sub-paragraph shall be in the Chinese

language together with an English language translation of the same translated by

(x) an internationally recognised firm of independent accountants or (y) a

professional translation service provider and checked by an internationally

recognised firm of independent accountants together with a certificate signed by

any Authorised Signatory certifying that such translation is complete and

accurate provided that if at any time the capital stock of the Issuer is listed

for trading on a recognised stock exchange the Issuer may furnish to the Trustee

as soon as they are available but in any event not more than 30 days after any

financial reports of the Issuer is filed with such recognised stock exchange on

which the Issuer’s capital stock is at such time listed for trading copies of such

financial report filed with such exchange in lieu of the reports identified in this

sub-paragraph (and if the same are not in the English language together with an

English translation of the same translated by (x) an internationally recognised

firm of independent accountants or (y) a professional translation service provider

and checked by an internationally recognised firm of independent accountants

together with a certificate in English signed by any Authorised Signatory

certifying that such translation is complete and accurate).– 90 –3.7 Definitions

For the purposes of these Conditions:

“Audited Financial Reports” means the annual audited consolidated statement of

financial position statement of profit or loss statement of cash flows of the Issuer

and its consolidated Subsidiaries and statement of changes in owners’ equity of

the Issuer together with any statements reports (including any directors’ and

auditors’ reports) and notes attached to or intended to be read with any of them;

“Compliance Certificate” means a certificate of the Issuer in English substantially

in the form scheduled to the Trust Deed signed by an Authorised Signatory

certifying that having made all reasonable enquiries to the best of the knowledge

information and belief of the Issuer as at a date (the “Certification Date”) not

more than five days before the date of the certificate:

(a) no Event of Default or Potential Event of Default (as defined in the Trust

deed) had occurred since the Certification Date of the last such certificate or

(if none) the date of the Trust Deed or if such an event had occurred giving

details of it; and

(b) the Issuer has complied with all its respective obligations under the Trust

Deed and the Bonds or if any non-compliance had occurred giving details of

it;

“CSRC” means the China Securities Regulatory Commission;

“CSRC Filing Report” means the filing report of the Issuer in relation to the

issuance of the Bonds which will be submitted to the CSRC within three

Registration Business Days after the Issue Date pursuant to Articles 13 and 16 of

the CSRC Filing Rules;

“CSRC Filing Rules” means the Trial Administrative Measures of Overseas

Securities Offering and Listing by Domestic Companies (境內企業境外發行證券和

上市管理試行辦法) and supporting guidelines issued by the CSRC on 17 February

2023 and became effective on 1st March 2023 as amended supplemented or

otherwise modified from time to time;

“Hong Kong” means the Hong Kong Special Administrative Region of the

People’s Republic of China;

“NDRC” means the National Development and Reform Commission of the PRC;

“person” means any individual corporation partnership limited liability

company joint venture trust unincorporated organisation or government or

any agency or political subdivision thereof;

“PRC” means the People’s Republic of China which shall for the purpose of these

Conditions only exclude Hong Kong the Macau Special Administrative Region

of the People’s Republic of China and Taiwan;

– 91 –“Registration Business Day” means a day other than a Saturday Sunday or

public holiday on which commercial banks are generally open for business in

Beijing;

“Registration Deadline” means the day falling 90 Registration Business Days after

the Issue Date;

“Relevant Indebtedness” means any present or future indebtedness having a

maturity of not less than one year incurred outside the PRC in the form of or

represented by bonds debentures notes loan stock bearer participation

certificates depositary receipts certificates of deposit or other investment

securities which represent indebtedness and are for the time being or are

intended to be or capable of being quoted listed ordinarily dealt in or traded on

any stock exchange or over-the-counter or other securities market but shall not

include any future or present indebtedness denominated in RMB and offered or

sold in the PRC;

“SAFE” means the State Administration of Foreign Exchange of the PRC or its

local branch;

“Subsidiary” or “subsidiary” means in relation to any person (i) any company or

other business entity of which that person owns or controls (either directly or

through one or more other Subsidiaries) more than 50 per cent. of the registered

share capital or issued share capital or other ownership interest having ordinary

voting power to elect directors managers or trustees of such company or other

business entity or (ii) any company or other business entity which at any time has

its accounts consolidated with those of that person or which under the laws of

Hong Kong or the PRC or in accordance with generally accepted accounting

principles applicable in the PRC from time to time should have its accounts

consolidated with those of that person; and

“Unaudited Financial Reports” means the semi-annual unaudited and unreviewed

consolidated statement of financial position statement of profit or loss statement

of cash flows of the Issuer and its consolidated Subsidiaries and statements of

changes in owners’ equity of the Issuer together with any statements reports

(including any directors’ and auditors’ reports if any) and notes attached to or

intended to be read with any of them if any.

4 INTEREST

The Bonds are zero coupon and do not bear interest unless upon due presentation

thereof payment of principal and premium (if any) is improperly withheld or refused.In such event such unpaid amount shall bear interest at the rate of two per cent. per

annum (both before and after judgment) until whichever is the earlier of (A) the day on

which all sums due in respect of such Bond up to that day are received by or on behalf

of the relevant holder and (B) the day falling seven days after the Trustee or the

Principal Agent has notified Bondholders of receipt of all sums due in respect of all the

Bonds up to that seventh day (except to the extent that there is failure in the

subsequent payment to the relevant holders under these Conditions).– 92 –If interest is required to be calculated for a period of less than one year it will be

determined on the basis of a 360-day year consisting of twelve months of 30 days each

and in the case of an incomplete month the number of days elapsed.

5 CONVERSION

5.1 Conversion Right

5.1.1 Conversion Right and Conversion Period: Subject as hereinafter provided

Bondholders have the right to convert their Bonds into H Shares credited as

fully paid at any time during the Conversion Period referred to below.Subject to and upon compliance with these Conditions the right of aBondholder to convert any Bond into H Shares is called the “ConversionRight”. The number of H Shares to be issued on conversion of a Bond will be

determined by dividing the principal amount of the Bond to be converted

(translated into HK dollars at the fixed rate of RMB0.9133 = HK$1.00) (the

“Fixed Exchange Rate”) by the Conversion Price (as defined in Condition

5.1.3 (Conversion Price)) in effect on the Conversion Date (as defined in

Condition 5.2.1 (Conversion Notice)). A Conversion Right may only be

exercised in respect of an Authorised Denomination for one or more Bonds.If more than one Bond held by the same holder is converted at any one time

by the same holder the number of H Shares to be issued upon such

conversion will be calculated on the basis of the aggregate principal amount

of the Bonds to be converted.Subject to and upon compliance with these Conditions (including without

limitation Condition 5.1.4 (Revival and/or survival after Default)) the

Conversion Right attaching to any Bond may be exercised at the option of

the holder thereof at any time on or after the 41st day after the Issue Date up

to the close of business (at the place where the Certificate evidencing such

Bond is deposited for conversion) on the date falling seven working days

prior to the Maturity Date (as defined in Condition 7.1 (Maturity)) (both

days inclusive) or if such Bond shall have been called for redemption by the

Issuer before the Maturity Date then up to and including the close of

business (at the place aforesaid) on a date no later than seven working days

(at the place aforesaid) prior to the date fixed for redemption thereof;

provided that no Conversion Right may be exercised in respect of a Bond

where the holder shall have exercised its right to require the Issuer to redeem

or repurchase such Bond pursuant to Condition 7.4 (Redemption at the

Option of the Bondholders) or Condition 7.5 (Redemption for Relevant Events)

or during a Restricted Conversion Period (both dates inclusive) (as defined

below); provided further that the Conversion Right is exercised subject to

any applicable fiscal or other laws or regulations or as hereafter provided in

these Conditions (the “Conversion Period”).In accordance with the below paragraphs exercise of Conversion Rights is

restricted in relation to any Bond during the period (i) commencing for an

annual shareholders’ general meeting of the Issuer on the date falling 20

days prior to that meeting or for an extraordinary shareholders’ general

meeting of the Issuer on the date falling 15 days prior to that meeting and

– 93 –ending on the date of that meeting; or (ii) commencing the date falling five

working days prior to the record date set by the Issuer for the purpose of

distribution of any dividend and ending on such record date; or (iii)

commencing on such date and for such period as determined by applicable

law from time to time that the Issuer is required to close its register (a

“Restricted Conversion Period”). The Issuer will give notice of any such

Restricted Conversion Period to the Bondholders the Trustee and the Agents

not less than five working days prior to the commencement of any such

Restricted Conversion Period.If the Conversion Date in respect of a Bond would otherwise fall during a

Restricted Conversion Period such Conversion Date shall be postponed to

the first H Share Stock Exchange Business Day (as defined in Condition 5.8

(Definitions)) following the expiry of such Restricted Conversion Period.

If the Conversion Date in respect of the exercise of any Conversion Right is

postponed as a result of the foregoing provision to a date that falls after the

expiry of the Conversion Period or after the relevant redemption date such

Conversion Date shall be deemed to be the final day of such Conversion

Period or the relevant redemption date as the case may be.For the purpose of this Condition 5.1.1 (Conversion Right and Conversion

Period) “working day” means a day other than a Saturday Sunday or a

public holiday on which commercial banks and foreign exchange markets are

generally open for business in the city which the specified office of each of the

Principal Agent and the Registrar is located respectively.

5.1.2 Fractions of H Shares: Fractions of H Shares will not be issued on conversion

and no cash payments or other adjustments will be made in lieu thereof.However if the Conversion Right in respect of more than one Bond is

exercised at any one time such that H Shares to be issued on conversion are

to be registered in the same name the number of such H Shares to be issued

in respect thereof shall be calculated on the basis of the aggregate principal

amount of such Bonds being so converted and rounded down to the nearest

whole number of H Shares. Notwithstanding the foregoing in the event of a

consolidation or re-classification of H Shares by operation of law or

otherwise occurring after 28 July 2025 which reduces the number of H Shares

outstanding the Issuer will upon conversion of Bonds pay in cash in U.S.dollars (by means of a U.S. dollar cheque drawn on a bank that processes

payments in U.S. dollars and mailed directly to the address of the

Bondholder or by transfer to a U.S. dollar account maintained by the

payee in either case in accordance with instructions given by the relevant

Bondholder in the Conversion Notice) a sum equal to such portion of the

principal amount of the Bond or Bonds evidenced by the Certificate

deposited in connection with the exercise of Conversion Rights aggregated

as provided in Condition 5.1.1 (Conversion Right and Conversion Period) as

corresponds to any fraction of an H Share not issued as a result of such

consolidation or re-classification aforesaid if such sum exceeds U.S.$10.00

(which shall be determined using the Prevailing Rate on the Conversion

Date).– 94 –5.1.3 Conversion Price: The price at which H Shares will be issued upon conversion

(the “Conversion Price”) will initially be HK$30.25 per H Share but will be

subject to adjustment in the manner provided in Condition 5.3 (Adjustments

to Conversion Price).

5.1.4 Revival and/or survival after Default: Notwithstanding the provisions of

Condition 5.1.1 (Conversion Right and Conversion Period) if (i) the Issuer

shall default in making payment in full in respect of any Bond which shall

have been called or put for redemption on the date fixed for redemption

thereof (ii) any Bond has become due and payable prior to the Maturity

Date by reason of the occurrence of any of the events referred to in Condition

9 (Events of Default) or (iii) any Bond is not redeemed on the Maturity Date

in accordance with Condition 7.1 (Maturity) the Conversion Right attaching

to such Bond will revive and/or will continue to be exercisable up to and

including the close of business (at the place where the Certificate evidencing

such Bond is deposited for conversion) on the date upon which the full

amount of the moneys payable in respect of such Bond has been duly received

by the Principal Agent or the Trustee and notice of such receipt has been duly

given to the Bondholders in accordance with Condition 16 (Notices) and

notwithstanding the provisions of Condition 5.1.1 (Conversion Right and

Conversion Period) any Bond in respect of which the Certificate and

Conversion Notice are deposited for conversion prior to such date shall be

converted on the relevant Conversion Date notwithstanding that the full

amount of the moneys payable in respect of such Bond shall have been

received by the Principal Agent or the Trustee before such Conversion Date

or that the Conversion Period may have expired before such Conversion

Date.

5.1.5 Meaning of “Shares”: As used in these Conditions the expression (i) “HShares” means ordinary foreign shares with a par value of RMB1.00 each

issued by the Issuer which are listed on the Hong Kong Stock Exchange; (ii)

“A Shares” means ordinary domestic shares of RMB1.00 each issued by the

Issuer which are traded in Renminbi on the Shenzhen Stock Exchange; and

(iii) “Ordinary Shares” means the H Shares the A Shares and any fully-paid

and non-assessable shares of any class or classes of the ordinary shares of the

Issuer authorised after the date of the issue of the Bonds which have no

preference in respect of dividends or of amounts payable in the event of any

voluntary or involuntary liquidation or dissolution of the Issuer.– 95 –5.2 Conversion Procedure

5.2.1 Conversion Notice:

Conversion Rights may be exercised by a Bondholder during the Conversion

Period by delivering the relevant Certificate to the specified office of any

Conversion Agent during its usual business hours (being 9 : 00 a.m. (Hong

Kong time) to 3 : 00 p.m. (Hong Kong time) Monday to Friday except for

public holidays on which commercial banks are generally open for business

in the city of the specified office of the Conversion Agent) accompanied by a

duly completed and signed notice of conversion (a “Conversion Notice”) in

the form (for the time being current and being substantially in the form

scheduled to the Agency Agreement) obtainable from any Conversion Agent

together with (i) the relevant Certificate; and (ii) certification by the

Bondholder in the form obtainable from any Conversion Agent as may be

required under the laws of the PRC Hong Kong or any jurisdiction in which

the specified office of such Conversion Agent is located. Conversion Rights

shall be exercised subject in each case to any applicable fiscal or other laws or

regulations applicable in the jurisdiction in which the specified office of the

Conversion Agent to whom the relevant Conversion Notice is delivered is

located.If such delivery is made after 3.00 p.m. (Hong Kong time) on any business

day or on a day which is not a business day in each case in the place of the

specified office of the Conversion Agent such delivery shall be deemed for all

purposes of these Conditions to have been made on the next business day

following such day. If such delivery is made during a Restricted Conversion

Period such delivery shall be deemed for all purposes of these Conditions to

have been made on the H Share Stock Exchange Business Day following (in

the place of the specified office of the Conversion Agent) the last day of such

Restricted Conversion Period unless such date shall fall outside the

Conversion Period.Any determination as to whether any Conversion Notice has been duly

completed and properly delivered shall be made by the relevant Conversion

Agent and shall save in the case of manifest error be conclusive and binding

on the Issuer the Trustee the Agents and the relevant Bondholder.A Conversion Notice once delivered shall be irrevocable and may not be

withdrawn without the Issuer’s consent.The conversion date in respect of a Bond (the “Conversion Date”) shall be

deemed to be the H Share Stock Exchange Business Day immediately

following the date of the surrender of the Certificate in respect of such Bond

and delivery of such Conversion Notice and if applicable any such

certificate and/or any payment to be made or indemnity given under these

Conditions in connection with the exercise of such Conversion Right.– 96 –5.2.2 Stamp Duty etc.: A Bondholder delivering a Certificate in respect of a Bond

for conversion must pay directly to the relevant authorities or party any taxes

and duties including capital stamp issue excise transfer registration and

other similar taxes and duties and transfer costs (“Duties”) in any applicable

jurisdiction arising on conversion (other than any Duties payable in the PRC

or Hong Kong or if relevant in the place of the Alternative Stock Exchange

by the Issuer in respect of the allotment and issue of H Shares and listing of

the H Shares on the Hong Kong Stock Exchange or the Alternative StockExchange (as the case may be) on conversion such Duties being the “IssuerDuties”) (such Duties and Issuer Duties are collectively known as “Taxes”).The Issuer will pay all other expenses arising from the issue of H Shares onconversion of the Bonds and all charges (together the “ConversionExpenses”) of the Agents and the share transfer agent for the H Shares.The Bondholder (and if different the person to whom the H Shares are to be

issued) must declare in the relevant Conversion Notice that any amounts

payable to the relevant tax authorities or party in settlement of Duties (other

than the Issuer Duties) payable pursuant to this Condition 5.2.2 (Stamp Duty

etc.) have been paid.If the Issuer fails to pay any Issuer Duties or Conversion Expenses the

relevant holder shall be entitled to tender and pay the same and the Issuer as

a separate and independent stipulation covenants to reimburse and

indemnify each Bondholder in respect of any payment thereof and any

penalties payable in respect thereof.Such Bondholder must also pay all if any Duties (other than Issuer Duties)

imposed on it and arising by reference to any disposal or deemed disposal of

a Bond or interest therein in connection with the exercise of Conversion

Rights by it.Neither the Trustee nor the Agents shall be responsible for determining

whether such Taxes or Conversion Expenses are payable or the amount

thereof and none of them shall be responsible or liable for any failure by the

Issuer or any Bondholder to pay any such amount.– 97 –5.2.3 Registration:

(i) As soon as practicable and in any event not later than seven H Share

Stock Exchange Business Days (excluding any H Share Stock Exchange

Business Days that fall within a Restricted Conversion Period) after the

Conversion Date the Issuer will in the case of Bonds converted on

exercise of the Conversion Right and in respect of which a duly

completed Conversion Notice has been delivered and the relevant

Certificate and certification and amounts payable by the relevant

Bondholder deposited or paid as required by Conditions 5.2.1

(Conversion Notice) and 5.2.2 (Stamp Duty etc.) register the person or

persons designated for the purpose in the Conversion Notice as

holder(s) of the relevant number of H Shares in the Issuer’s H share

register and will if the Bondholder has also requested in the Conversion

Notice and to the extent permitted under applicable law and the rules

and procedures of the Central Clearing and Settlement System of Hong

Kong (“CCASS”) take all action reasonably necessary to enable the H

Shares to be delivered through CCASS for so long as the H Shares are

listed on the Hong Kong Stock Exchange; or will make such certificate

or certificates available for collection at the office of the Issuer’s share

registrar in Hong Kong (being at the time of issue of the Bonds

Computershare Hong Kong Investor Services Limited at Shops

1712–16 17th Floor Hopewell Centre 183 Queen’s Road East

Wanchai Hong Kong) notified to Bondholders in accordance with

Condition 16 (Notices) or if so requested in the relevant Conversion

Notice cause its share registrar to mail (at the risk and if sent at the

request of such person otherwise than by ordinary mail at the expense

of the person to whom such certificate or certificates are sent) such

certificate or certificates to the person and at the place specified in the

Conversion Notice together (in either case) with any other securities

property or cash required to be delivered upon conversion and such

assignments and other documents (if any) as may be required by law to

effect the transfer thereof.(ii) The delivery of the H Shares to the converting Bondholder (or such

person or persons designated in the relevant Conversion Notice) in the

manner contemplated in Condition 5.2.3(i) will be deemed to satisfy the

Issuer’s obligation to pay any amounts under such converted Bonds.The person or persons designated in the Conversion Notice will become

the holder of record of the number of H Shares issuable upon conversion

with effect from the date he is or they are registered as such in the

Issuer’s register of members for H shares (the “Registration Date”). The

H Shares issued upon exercise of the Conversion Rights will be fully

paid up and will in all respects rank pari passu with and within the same

class as the H Shares in issue on the relevant Registration Date except

for any right excluded by mandatory provisions of applicable law. Save

as set out in these Conditions a holder of H Shares issued on exercise of

the Conversion Rights shall not be entitled to any rights distributions

or other payments the record date or due date for the establishment of

entitlement for which precedes the relevant Registration Date.– 98 –(iii) If (A) the Registration Date in relation to any Bond shall be on or after

the record date for any issue distribution grant offer or other event

that gives rise to the adjustment of the Conversion Price pursuant to

Condition 5.3 (Adjustments to Conversion Price) and (B) the Conversion

Date in relation to such exercise shall be before the date on which such

adjustment to the Conversion Price becomes effective under the relevant

Condition (any such adjustment a “Retroactive Adjustment”) upon the

relevant adjustment to the Conversion Price becoming effective under

the relevant Condition the Issuer shall procure the issue to the

converting Bondholder (in accordance with the instructions contained

in the Conversion Notice (subject to any applicable laws orregulations)) such additional number of H Shares (“Additional HShares”) as together with the H Shares issued or to be issued on

conversion of the relevant Bond is equal to the number of H Shares

which would have been required to be issued on conversion of such

Bond if the relevant adjustment to the Conversion Price under the

relevant Condition had been made and become effective on or

immediately prior to the relevant Conversion Date and in such event

and in respect of such Additional H Shares references in this Condition

5.2.3(iii) to the Conversion Date shall be deemed to refer to the date

upon which the Retroactive Adjustment becomes effective

(notwithstanding that the date upon which it becomes effective falls

after the end of the Conversion Period).

5.3 Adjustments to Conversion Price

Upon the occurrence of any of the following events described below the

Conversion Price will be adjusted as follows:

5.3.1 Consolidation Subdivision or Re-classification: If and whenever there shall be

an alteration to the nominal value of the H Shares as a result of

consolidation subdivision or re-classification the Conversion Price shall

be adjusted by multiplying the Conversion Price in force immediately before

such alteration by the following fraction:

A

B

Where:

A is the nominal amount of one H Share immediately after such alteration;

and

B is the nominal amount of one H Share immediately before such

alteration.Such adjustment shall become effective on the date the alteration takes effect.– 99 –5.3.2 Capitalisation of Profits or Reserves:

(i) If and whenever the Issuer shall issue Ordinary Shares of any classcredited as fully paid to the holders of such Ordinary Shares (“OrdinaryShareholders”) by way of capitalisation of profits or reserves including

Ordinary Shares of such class paid up out of distributable profits or

reserves and/or share premium account (except any Scrip Dividend) the

Conversion Price shall be adjusted by multiplying the Conversion Price

in force immediately before such issue by the following fraction:

A

B

Where:

A is the aggregate nominal amount of the issued Ordinary Shares

immediately before such issue; and

B is the aggregate nominal amount of the issued Ordinary Shares

immediately after such issue.Such adjustment shall become effective on the date of issue of such

Ordinary Shares or if a record date is fixed therefor immediately after

such record date; provided that if there are different effective dates for

different classes of Ordinary Shares the effective date of the H Shares

shall prevail.– 100 –(ii) In the case of an issue of H Shares by way of a Scrip Dividend where the

aggregate value of such H Shares by way of a Scrip Dividend as

determined by reference to the Current Market Price on the date of

announcement of the terms of such Scrip Dividend multiplied by the

number of such H Shares issued exceeds 105 per cent. of the amount of

the Relevant Cash Dividend or the relevant part thereof (in respect of

the H Shares) and which would not have constituted a Capital

Distribution the Conversion Price shall be adjusted by multiplying

the Conversion Price in force immediately before the issue of such Scrip

Dividend by the following fraction:

A + B

A + C

Where:

A is the aggregate nominal amount of the issued H Shares

immediately before such issue;

B is the aggregate nominal amount of such Scrip Dividend multiplied

by a fraction of which (i) the numerator is the amount of the whole

or the relevant part of the Relevant Cash Dividend in respect of

the H Shares and (ii) the denominator is such aggregate Current

Market Price of the Scrip Dividend issued in lieu of the whole or

the relevant part of the Relevant Cash Dividend in respect of the H

Shares; and

C is the aggregate nominal amount of such H Shares issued by way of

such Scrip Dividend

or by making such other adjustment as an Independent Financial

Advisor shall certify to the Trustee is fair and reasonable.Such adjustment shall become effective on the date of issue of such H

Shares or if a record date is fixed therefor immediately after such record

date.

5.3.3 Capital Distributions: If and whenever the Issuer shall pay or make any

Capital Distribution to the holders of H Shares (except to the extent that the

Conversion Price falls to be adjusted under Condition 5.3.2 (Capitalisation of

Profits or Reserves) above) the Conversion Price shall be adjusted by

multiplying the Conversion Price in force immediately before such Capital

Distribution by the following fraction:

A – B

A

Where:

A is the Current Market Price per H Share on the date on which the

Capital Distribution is first publicly announced; and

– 101 –B is the Fair Market Value of the portion of Capital Distribution

attributable to one H Share.Such adjustment shall become effective on the date that such Capital

Distribution is actually made or if a record date is fixed therefor

immediately after such record date. For the purpose of the above FairMarket Value shall (subject as provided in the definition of “Fair MarketValue” (as defined in Condition 5.8 (Definitions))) be determined as at the

date on which the Capital Distribution is first publicly announced or if later

the first date on which the Fair Market Value of the relevant Capital

Distribution is capable of being determined as provided herein.In making any calculation pursuant to this Condition 5.3.3 (Capital

Distributions) such adjustments (if any) shall be made as an Independent

Financial Advisor may consider appropriate to reflect (i) any consolidation

or subdivision of the H Shares (ii) issues of H Shares by way of capitalisation

of profits or reserves or any like or similar event (iii) the modification of

any rights to dividends of H Shares or (iv) any change in the fiscal year of the

Issuer.

5.3.4 Rights Issues of Shares or Options over Shares: If and whenever the Issuer

shall issue Ordinary Shares of one or more classes to all or substantially all

Ordinary Shareholders of such classes by way of rights or issue or grant to

all or substantially all Ordinary Shareholders of such classes by way of

rights options warrants or other rights to subscribe for purchase or

otherwise acquire any Ordinary Shares of such classes in each case at a

consideration less than 95 per cent. of the Current Market Price per H Share

on the date of the first public announcement of the terms of the issues or

grants the Conversion Price shall be adjusted by multiplying the Conversion

Price in force immediately before such issues or grants by the following

fraction:

A + B1 + B2

A + C1+ C2

Where:

A is the aggregate number of Ordinary Shares of all classes in issue

immediately before such announcement;

B1 is the number of Ordinary Shares of one class which the aggregate

consideration (if any) receivable for the Ordinary Shares of such class

issued by way of rights or for the options or warrants or other rights

issued or granted by way of rights and for the total number of Ordinary

Shares of such class comprised therein would subscribe for purchase or

otherwise acquire at such Current Market Price per Ordinary Share of

the class;

B2 where applicable is the number of Ordinary Shares of a second class

which the aggregate consideration (if any) receivable for the Ordinary

Shares of such class issued by way of rights or for the options or

– 102 –warrants or other rights issued or granted by way of rights and for the

total number of Ordinary Shares of such class comprised therein would

subscribe for purchase or otherwise acquire at such Current Market

Price per Ordinary Share of the class;

C1 is the aggregate number of Ordinary Shares of one class issued or as the

case may be comprised in the issue or grant; and

C2 where applicable is the aggregate number of Ordinary Shares of a

second class issued or as the case may be comprised in the issue or

grant.Such adjustment shall become effective on the date of issue of such Ordinary

Shares or issue or grant of such options warrants or other rights (as the case

may be) or where a record date is set the first date on which the Ordinary

Shares are traded ex-rights ex-options or ex-warrants as the case may be;

provided that if there are different effective dates for different classes of

Ordinary Shares the effective date of H Shares shall prevail.

5.3.5 Rights Issues of Other Securities: In respect of each class of Ordinary Shares

if and whenever the Issuer shall issue any securities (other than Ordinary

Shares or options warrants or other rights to subscribe for purchase or

otherwise acquire Ordinary Shares) to all or substantially all Ordinary

Shareholders of such class by way of rights or issue or grant to all or

substantially all Ordinary Shareholders of such class by way of rights

options warrants or other rights to subscribe for purchase or otherwise

acquire any securities (other than Ordinary Shares or options warrants or

other rights to subscribe for purchase or otherwise acquire Ordinary Shares)

the Conversion Price shall be adjusted by multiplying the Conversion Price in

force immediately before such issue or grant by the following fraction:

A – B

A

Where:

A is the aggregate Ordinary Shares of all classes in issue multiplied by their

respective Current Market Price per Ordinary Share on the date on

which the terms of such issue or grant are publicly announced; and

B is the Fair Market Value of the aggregate securities rights options or

warrants (as the case may be) attributable to the Ordinary Shares.Such adjustment shall become effective on the date of issue of the securities

or the issue or grant of such rights options or warrants (as the case may be)

or where a record date is set the first date on which the Ordinary Shares are

traded ex-rights ex-options or ex-warrants as the case may be provided that

if there are different effective dates for different classes of Ordinary Shares

the effective date of the H Shares shall prevail. For the purpose of the aboveFair Market Value shall (subject as provided in the definition of “FairMarket Value” (as defined in Condition 5.8 (Definitions))) be determined as

– 103 –at the date on which the terms of such issue or grant is first publicly

announced or if later the first date on which the Fair Market Value of the

aggregate rights attributable to the Ordinary Shares in relation to such issue

or grant is capable of being determined as provided herein.

5.3.6 Issues at Less than Current Market Price: If and whenever the Issuer shall

issue (otherwise than as mentioned in Condition 5.3.4 (Rights Issues of

Shares or Options over Shares) above) any Ordinary Shares (other than H

Shares issued on the exercise of Conversion Rights or on the exercise of any

other rights of conversion into or exchange or subscription for Ordinary

Shares) or issue or grant (otherwise than as mentioned in Condition 5.3.4

(Rights Issues of Shares or Options over Shares) above) options warrants or

other rights to subscribe for purchase or otherwise acquire Ordinary Shares

of one or more classes in each case at a consideration which is less than 95

per cent. of the Current Market Price per H Share on the date of

announcement of the terms of such issues the Conversion Price shall be

adjusted by multiplying the Conversion Price in force immediately before

such issues by the following fraction:

A + B1 + B2

A + C1 + C2

Where:

A is the aggregate number of Ordinary Shares of all classes in issue

immediately before the issue of such additional Ordinary Shares of such

class or the grant of such options warrants or other rights to subscribe

for purchase or otherwise acquire any Ordinary Shares of such class;

B1 is the number of Ordinary Shares of one class which the aggregate

consideration (if any) receivable for the issue of such additional

Ordinary Shares of such class would purchase at the Current Market

Price per Ordinary Share of such class;

B2 where applicable is the number of Ordinary Shares of a second class

which the aggregate consideration (if any) receivable for the issue of

such additional Ordinary Shares of such class would purchase at the

Current Market Price per Ordinary Share of such class;

C1 is the aggregate number of Ordinary Shares of one class issued or as the

case may be the maximum number of Ordinary Shares of such class to

be issued on the exercise of such options warrants or other rights at the

initial exercise price or rate; and

C2 where applicable is the aggregate number of Ordinary Shares of a

second class issued or as the case may be the maximum number of

Ordinary Shares of such class to be issued on the exercise of such

options warrants or other rights at the initial exercise price or rate.– 104 –References to additional Ordinary Shares in the above formula shall in the

case of an issue by the Issuer of options warrants or other rights to subscribe

or purchase Ordinary Shares mean such Ordinary Shares to be issued

assuming that such options warrants or other rights are exercised in full at

the initial exercise price or rate on the date of issue or grant of such options

warrants or other rights.Such adjustment shall become effective on the date of issue of such additional

Ordinary Shares or as the case may be the issue or grant of such options

warrants or other rights; provided that if there are different effective dates

for different classes of Ordinary Shares the effective date of the H Shares

shall prevail.

5.3.7 Other Issues at less than Current Market Price: Save in the case of an issue of

securities arising from a conversion or exchange of other securities in

accordance with the terms applicable to such securities themselves falling

within this Condition 5.3.7 (Other Issues at less than Current Market Price) if

and whenever the Issuer or any of its Subsidiaries (otherwise than as

mentioned in Condition 5.3.4 (Rights Issues of Shares or Options over

Shares) Condition 5.3.5 (Rights Issues of Other Securities) or Condition 5.3.6

(Issues at Less than Current Market Price)) or (at the direction or request of

or pursuant to any arrangements with the Issuer or any of its Subsidiaries)

any other company person or entity shall issue any securities (other than the

Bonds which shall be deemed to exclude any further bonds issued pursuant

to Condition 15 (Further Issues)) which by their terms of issues carry rights of

conversion into or exchange or subscription for Ordinary Shares of one or

more classes to be issued by the Issuer upon conversion exchange or

subscription in each case at a consideration which is less than 95 per cent. of

the Current Market Price per H Share on the date of announcement of the

terms of issues of such securities the Conversion Price shall be adjusted by

multiplying the Conversion Price in force immediately before such issues by

the following fraction:

A + B1 + B2

A + C1 + C2

Where:

A is the aggregate number of Ordinary Shares of all classes in issue

immediately before such issue;

B1 is the number of Ordinary Shares of one class which the aggregate

consideration receivable by the Issuer for the Ordinary Shares of such

class to be issued on conversion or exchange or on exercise of the right

of subscription attached to such securities would purchase at such

Current Market Price per Ordinary Share of such class;

– 105 –B2 where applicable is the number of Ordinary Shares of a second class

which the aggregate consideration receivable by the Issuer for the

Ordinary Shares of such class to be issued on conversion or exchange or

on exercise of the right of subscription attached to such securities would

purchase at such Current Market Price per Ordinary Share of such class;

C1 is the maximum number of Ordinary Shares of one class to be issued on

conversion or exchange of such securities or on the exercise of such

rights of subscription attached thereto at the initial conversion

exchange or subscription price or rate; and

C2 where applicable is the maximum number of Ordinary Shares of a

second class to be issued on conversion or exchange of such securities or

on the exercise of such rights of subscription attached thereto at the

initial conversion exchange or subscription price or rate.Such adjustment shall become effective on the date of issue of such securities.

5.3.8 Modification of Rights of Conversion etc.: If and whenever there shall be any

modification of the rights of conversion exchange subscription purchase or

acquisition attaching to any such securities as are mentioned in Condition

5.3.7 (Other Issues at less than Current Market Price) (other than in

accordance with the terms of such securities) so that the consideration per

Ordinary Share of one or more classes (for the number of Ordinary Shares of

such classes available on conversion exchange subscription purchase or

acquisition following the modification) is reduced and in each case is less

than 95 per cent. of the Current Market Price per H Share on the date of the

first public announcement of the proposals for such modifications the

Conversion Price shall be adjusted by multiplying the Conversion Price in

force immediately before such modifications by the following fraction:

A – B

A

Where:

A is the aggregate number of Ordinary Shares of all classes in issue

multiplied by their respective Current Market Price per Ordinary Share

on the date on which such modification is publicly announced; and

B is the difference between the Fair Market Value of the modification

aggregated across all Ordinary Shares of all classes in issue on the date

of such announcement and the aggregate consideration received for the

modification.Such adjustment shall become effective on the date of modification of the

rights of conversion exchange subscription purchase or acquisition

attaching to such securities.– 106 –5.3.9 Other Offers to Ordinary Shareholders: In respect of H Shares if and

whenever the Issuer or any of its Subsidiaries or (at the direction or request

of or pursuant to any arrangements with the Issuer or any of its Subsidiaries)

any other company person or entity issues sells or distributes any securities

in connection with an offer pursuant to which the holders of H Shares

generally are entitled to participate in arrangements whereby such securities

may be acquired by them (except where the Conversion Price falls to be

adjusted under Condition 5.3.4 (Rights Issues of Shares or Options over

Shares) Condition 5.3.5 (Rights Issues of Other Securities) Condition 5.3.6

(Issues at Less than Current Market Price) or Condition 5.3.7 (Other Issues at

less than Current Market Price)) the Conversion Price shall be adjusted by

multiplying the Conversion Price in force immediately before such issue by

the following fraction:

A – B

A

Where:

A is the Current Market Price per H Share on the date on which the terms

of such issue sale or distribution of securities are first publicly

announced; and

B is the Fair Market Value of the portion of the rights attributable to one

H Share.Such adjustment shall become effective on the date of issue sale or

distribution of the securities or if a record date is fixed therefor

immediately after such record date or if later the first date upon which the

Fair Market Value of the relevant securities is capable of being determined as

provided herein. For the purpose of the above Fair Market Value shall

(subject as provided in the definition of “Fair Market Value” (as defined in

Condition 5.8 (Definitions))) be determined as at the date on which the terms

of such issue sale or distribution of securities are first publicly announced or

if later the first date on which the Fair Market Value of the portion of the

aggregate rights attributable to the Ordinary Shares is capable of being

determined as provided herein.

5.3.10 Other Events: If the Issuer determines in its sole discretion that an

adjustment should be made to the Conversion Price as a result of one or more

events or circumstances not referred to in this Condition 5.3 (Adjustments to

Conversion Price) the Issuer shall at its own expense consult an

Independent Financial Advisor to determine as soon as practicable what

adjustment (if any) to the Conversion Price is fair and reasonable to take

account thereof if the adjustment would result in a reduction in the

Conversion Price and the date on which such adjustment should take effect

and upon such determination by the Independent Financial Advisor such

adjustment (if any) shall be made and shall take effect in accordance with

such determination provided that where the events or circumstances giving

rise to any adjustment pursuant to this Condition 5.3 (Adjustments to

– 107 –Conversion Price) have already resulted or will result in an adjustment to the

Conversion Price or where the events or circumstances giving rise to any

adjustment arise by virtue of events or circumstances which have already

given rise or will give rise to an adjustment to the Conversion Price such

modification (if any) shall be made to the operation of the provisions of this

Condition 5.3 (Adjustments to Conversion Price) as may be advised by the

Independent Financial Advisor to be in its opinion appropriate to give the

intended result. Notwithstanding the foregoing the per Ordinary Share value

of any such adjustment shall not exceed the per Ordinary Share value of the

dilution in the Ordinary Shareholders’ interest in the Issuer’s equity caused

by such events or circumstances.

5.3.11 Further Classes of Ordinary Shares: In the event that the Issuer has more than

two classes of Ordinary Shares outstanding at any time the formulae set out

in this Condition 5.3 (Adjustments to Conversion Price) shall be restated to

take into account such further classes of Ordinary Shares so that “B1 + B2”

and “C1 + C2” shall become “B1 + B2 + B3” and “C1 + C2 + C3” and “B3”

and “C3” shall have the same meaning as “B1” and “C1” respectively but by

reference to a third class of Ordinary Shares and so on.

5.4 Undertakings

5.4.1 The Issuer has undertaken in the Trust Deed inter alia that so long as any

Bond remains outstanding save with the approval of an Extraordinary

Resolution (as defined in the Trust Deed) of the Bondholders:

(i) it will use its commercially reasonable endeavours (a) to maintain a

listing for the H Shares on the Hong Kong Stock Exchange (b) to

obtain and maintain a listing for all the H Shares issued on the exercise

of the Conversion Rights attaching to the Bonds on the Hong Kong

Stock Exchange and (c) if the Issuer having used such endeavours is

unable to obtain or maintain such listing to instead use all reasonable

endeavours to obtain and maintain a listing for all the issued H Shares

on such Alternative Stock Exchange as the Issuer may from time to time

determine and will forthwith give notice to the Bondholders in

accordance with Condition 16 (Notices) of the listing or delisting of

the H Shares (as a class) by any of such stock exchange;

(ii) it will pay the expenses of the issue and delivery of and all expenses of

obtaining listing for H Shares arising on conversion of the Bonds (save

for the Duties to be borne by any Bondholder as described in Condition

5.2.2 (Stamp Duty etc.));

(iii) it will not make any reduction of its registered share capital or any

uncalled liability in respect thereof or of any share premium account or

capital redemption reserve fund (except in each case as permitted by

law (including but not limited to repurchase or cancellation of its shares

(i) pursuant to any share incentive or share option schemes of the Issuer;

(ii) as a result of its shareholders’ dissent to the Issuer’s merger or

segregation in a shareholders’ meeting and request the Issuer to

repurchase its shares; (iii) for the protection of the interests of the

– 108 –Issuer’s shareholders; and (iv) as permitted by laws and regulations and

the Issuer’s articles of association) provided that all or any part of the

corporate action(s) comprising the reduction results in an adjustment to

the Conversion Price then in effect or would otherwise be taken into

account for the purposes of determining whether such an adjustment

should be made pursuant to Condition 5;

(iv) it will use all commercially reasonable endeavours to maintain the listing

of the Bonds on the Hong Kong Stock Exchange.

5.4.2 In the Trust Deed the Issuer has undertaken with the Trustee inter alia that

so long as any Bond remains outstanding save with the approval of an

Extraordinary Resolution of the Bondholders:

(i) it will issue H Shares to Bondholders on exercise of Conversion Rights

and ensure that it has the ability to issue free from pre-emptive or other

similar rights such number of H Shares on exercise of any Conversion

Right as would enable the Conversion Rights and all other rights of

subscription and exchange for and conversion into H Shares to be

satisfied in full and will ensure that all H Shares delivered upon

conversion of the Bonds will be duly and validly issued as fully-paid and

not subject to call for further funds; and

(ii) it will not make any offer issue or distribution or take any action the

effect of which would be to reduce the Conversion Price below the par

value of the H Shares of the Issuer provided always that the Issuer shall

not be prohibited from purchasing its H Shares to the extent permitted

by law.

5.4.3 The Issuer has also given certain other undertakings in the Trust Deed for the

protection of the Conversion Rights.

5.5 Notice of Change in Conversion Price

The Issuer shall give notice to the Hong Kong Stock Exchange to the Trustee and

each Conversion Agent in writing and to the Bondholders in accordance with

Condition 16 (Notices) of any change in the Conversion Price. Any such notice

relating to a change in the Conversion Price shall set forth the event giving rise to

the adjustment the Conversion Price prior to such adjustment the adjusted

Conversion Price and the effective date of such adjustment.

5.6 Adjustment upon Change of Control

If a Change of Control (as defined in Condition 7.5.5(ii) shall have occurred theIssuer shall give notice of that fact to the Bondholders (the “Change of ControlNotice”) in accordance with Condition 16 (Notices) and to the Trustee and the

Agents in writing within 14 days after it becomes aware of such Change of

Control. Following the giving of a Change of Control Notice upon any exercise

of Conversion Rights such that the relevant Conversion Date falls within the

period of 30 days following the later of (i) the occurrence of the relevant Change

– 109 –of Control and (ii) the date on which the Change of Control Notice is given to

Bondholders (such period the “Change of Control Conversion Period”) the

Conversion Price shall be adjusted in accordance with the following formula:

NCP = OCP/(1 + (CP x c/t))

Where:

NCP = the Conversion Price after such adjustment;

OCP = the Conversion Price before such adjustment. For the avoidance of

doubt OCP for the purposes of this Condition 5.6 (Adjustment upon

Change of Control) shall be the Conversion Price applicable on the

relevant Conversion Date in respect of any conversion pursuant to

this Condition 5.6 (Adjustment upon Change of Control);

Conversion Premium (“CP”) = 22 per cent. expressed as a fraction;

c = the number of days from and including the first day of the Change

of Control Conversion Period to but excluding the Maturity Date;

and

t = the number of days from and including the Issue Date to but

excluding the Maturity Date

provided that the Conversion Price shall not be reduced pursuant to this

Condition 5.6 (Adjustment upon Change of Control) below the level permitted by

applicable laws and regulations from time to time (if any).If the last day of a Change of Control Conversion Period shall fall during a

Restricted Transfer Period or a Restricted Conversion Period as the case may be

the Change of Control Conversion Period shall be extended such that its last day

will be the fifteenth day following the last day of the Restricted Transfer Period or

the Restricted Conversion Period as the case may be.On the H Share Stock Exchange Business Day immediately following the last day

of the Change of Control Conversion Period the Conversion Price shall be

re-adjusted to the Conversion Price in force immediately before the adjustment to

the Conversion Price during the Change of Control Conversion Period.

5.7 Provisions Relating to Changes in Conversion Price

5.7.1 Minor Adjustments: On any adjustment the resultant Conversion Price if not

an integral multiple of one Hong Kong cent shall be rounded down to the

nearest Hong Kong cent. No adjustment shall be made to the Conversion

Price if such adjustment (rounded down if applicable) would be less than one

per cent. of the Conversion Price then in effect. Any adjustment not required

to be made and/or any amount by which the Conversion Price has been

rounded down shall be carried forward and taken into account in any

subsequent adjustment and such subsequent adjustment shall be made on the

basis that the adjustment not required to be made had been made at the

relevant time and/or as the case may be that the relevant rounding down

– 110 –had not been made. Notice of any adjustment shall be given by the Issuer to

the Bondholders in accordance with Condition 16 (Notices) and to the

Trustee and the Agents in writing in each case promptly after the

determination thereof.

5.7.2 Decision of an Independent Financial Advisor: If any doubt shall arise as to

whether an adjustment falls to be made to the Conversion Price or as to how

an adjustment to the Conversion Price under Condition 5.3 (Adjustments to

Conversion Price) or Condition 5.6 (Adjustment upon Change of Control)

should be made and following consultation between the Issuer and an

Independent Financial Advisor a written opinion of such Independent

Financial Advisor in respect thereof shall be conclusive and binding on the

Issuer the Bondholders and the Trustee save in the case of manifest error.Notwithstanding the foregoing the per H Share value of any such adjustment

shall not exceed the per H Share value of the dilution in the shareholders’

interest in the Issuer’s equity caused by such events or circumstances.

5.7.3 Minimum Conversion Price: Notwithstanding the provisions of this Condition

5 (Conversion) the Issuer undertakes that: (i) the Conversion Price shall not

in any event be reduced to below the nominal or par value of the H Shares as

a result of any adjustment hereunder unless under applicable law then in

effect the Bonds may be converted at such reduced Conversion Price into

legally issued fully paid and non-assessable H Shares; and (ii) it shall not

take any action and shall procure that no action is taken that would

otherwise result in an adjustment to the Conversion Price to below such

nominal or par value or any minimum level permitted by applicable laws or

regulations.

5.7.4 Reference to “fixed”: Any references herein to the date on which a

consideration is “fixed” shall where the consideration is originally

expressed by reference to a formula which cannot be expressed as an actual

cash amount until a later date be construed as a reference to the first day on

which such actual cash amount can be ascertained.

5.7.5 Multiple Events: Where more than one event which gives or may give rise to

an adjustment to the Conversion Price occurs within such a short period of

time that in the opinion of an Independent Financial Advisor the foregoing

provisions would need to be operated subject to some modification in order

to give the intended result such modification shall be made to the operation

of the foregoing provisions as may be advised by such Independent Financial

Advisor to be in its opinion appropriate in order to give such intended result.

5.7.6 Upward/Downward Adjustment: No adjustment involving an increase in the

Conversion Price will be made except in the case of a consolidation or

re-classification of the H Shares as referred to in Condition 5.3.1

(Consolidation Subdivision or Re-classification). The Issuer may at any

time and for a specified period of time only following notice being given to

the Trustee and the Agents in writing and to the Bondholders in accordance

with Condition 16 (Notices) reduce the Conversion Price subject to

Condition 5.7.3 (Minimum Conversion Price).– 111 –5.7.7 Trustee Not Obliged to Monitor or Make Calculations: Neither the Trustee

nor any Agent shall be under any duty to monitor whether any event or

circumstance has happened or exists which may require an adjustment to be

made to the Conversion Price or to make any calculation or determination

(or verification thereof) in connection with the Conversion Price and/or any

adjustments to it or any determinations advice or opinions made or given in

connection therewith and none of them will be responsible or liable to

Bondholders or any other person for any loss arising from any failure by it to

do so or for any delay by the Issuer or any Independent Financial Advisor in

making any calculation or determination or any erroneous calculation or

determination in connection with the Conversion Price.

5.7.8 Employee Share Option Schemes: No adjustment will be made to the

Conversion Price when Ordinary Shares or other securities (including

rights or options) are issued offered exercised allotted appropriated

modified or granted to or for the benefit of employees (including directors)

of the Issuer or any of its Subsidiaries pursuant to any employee share

scheme or plan (and which employee share scheme or plan is in compliance

with if applicable the Rules Governing the Listing of Securities on the Hong

Kong Stock Exchange or if applicable the Stock Listing Rules of the

Shenzhen Stock Exchange or if relevant the listing rules of the Alternative

Stock Exchange (“Share Scheme Options”) unless any issue or grant of Share

Scheme Options (which but for this provision would have required

adjustment pursuant to Condition 5 (Conversion)) would result in the total

number of Ordinary Shares which may be issued upon exercise of all Share

Scheme Options granted during the 12-month period up to and including the

date of such issue or grant representing in aggregate more than two per

cent. of the average of the issued and outstanding Ordinary Shares during

such 12-month period. For the avoidance of doubt any Ordinary Shares

issued in excess thereof and only such Ordinary Shares issued in excess

thereof shall be subject to adjustment to the Conversion Price and taken into

account in determining such adjustment as set out in Condition 5.3

(Adjustments to Conversion Price).

5.7.9 Consideration Receivable: For the purpose of any calculation of the

consideration receivable or price pursuant to Condition 5.3.4 (Rights Issues

of Shares or Options over Shares) Condition 5.3.6 (Issues at Less than

Current Market Price) Condition 5.3.7 (Other Issues at less than Current

Market Price) and Condition 5.3.8 (Modification of Rights of Conversion

etc.) the following provisions shall apply:

(i) the aggregate consideration receivable or price for Ordinary Shares of a

class issued for cash shall be the amount of such cash;

(ii) (a) the aggregate consideration receivable for Ordinary Shares of a class

to be issued on the conversion exercise or exchange of any options

warrants or other rights or securities (or following any modification

thereof) shall be deemed to be the consideration received or receivable

by the Issuer for any such options warrants or other rights or securities

(or following any modification thereof); (b) the aggregate consideration

receivable for Ordinary Shares of a class to be issued on the exercise of

– 112 –rights of subscription attached to any such securities (or following any

modification thereof) shall be deemed to be that part (which may be the

whole) of the consideration received or receivable by the Issuer for such

securities (or following any modification thereof) which is attributed by

the Issuer to such rights of subscription or if no part of such

consideration is so attributed to the Fair Market Value of such rights

of subscription as at the date of the announcement of the terms of issue

or modification of such securities plus in the case of each of (a) and (b)

above the additional minimum consideration (if any) to be received by

the Issuer on the conversion exercise or exchange of such options

warrants or other rights or securities (or following any modification

thereof) or on the exercise of such rights of subscription; and (c) the

consideration per Ordinary Share of a class receivable by the Issuer on

the conversion exercise or exchange of or on the exercise of such rights

of subscription attached to such options warrants or other rights or

securities (or following any modification thereof) shall be the aggregate

consideration referred to in (a) or (b) above (as the case may be) divided

by the number of Ordinary Shares of such class to be issued on such

conversion or exchange or exercise at the initial conversion exchange or

subscription price or rate;

(iii) if the consideration or price determined pursuant to (i) or (ii) above of

this Condition 5.7.9 (Consideration Receivable) (or any component

thereof) shall be expressed in a currency other than HK dollars it shall

be converted into HK dollars at the Prevailing Rate on the relevant date;

(iv) in determining the consideration or price pursuant to the above no

deduction shall be made for any commissions or fees (howsoever

described) or any expenses paid or incurred for any underwriting

placing or management of the issue of the relevant Ordinary Shares of a

class or securities or options warrants or rights or otherwise in

connection therewith;

(v) the consideration or price shall be determined as provided above on the

basis of the consideration or price received receivable paid or payable

regardless of whether all or part thereof is received receivable paid or

payable by or to the Issuer or another entity;

(vi) if as part of the same transaction Ordinary Shares of a class shall be

issued or issuable for a consideration receivable in more than one or in

different currencies then the consideration receivable per Share shall be

determined by dividing the aggregate consideration (determined as

aforesaid and converted if and to the extent not in HK dollars into HK

dollars at the Prevailing Rate as aforesaid) by the aggregate number of

Ordinary Shares so issued; and

(vii) neither the Trustee nor the Agents shall be under any duty to determine

calculate or verify any entitlement of any Bondholder to any amount

payable upon or following the exercise of any Conversion Right and

none of them will be responsible or liable to any Bondholder or any

other person for any loss arising from any failure to do so.– 113 –5.8 Definitions

For the purposes of these Conditions:

“Alternative Stock Exchange” means at any time in the case of the H Shares if

they are not at that time listed and traded on the Hong Kong Stock Exchange the

principal stock exchange or securities market on which such H Shares are then

listed or quoted or dealt in;

“Closing Price” means in respect of an Ordinary Share of a class for any Trading

Day the closing market price quoted by the principal stock exchange or securities

market on which the Ordinary Shares of such class are then listed admitted to

trading or quoted or dealt in and in the case of the A Shares shall (unless

otherwise determined at the relevant time) mean the Shenzhen Stock Exchange

and in the case of the H Shares shall (unless otherwise determined at the relevant

time) mean the Hong Kong Stock Exchange;

“Current Market Price” means in respect of an Ordinary Share of a class on a

particular date the average of the daily Closing Price on each of the 20

consecutive Trading Days ending on and including the Trading Day immediately

preceding such date and (if necessary) translated into HK dollars at the Prevailing

Rate as at the relevant date; provided that:

(A) for the purposes of determining the Current Market Price pursuant to

Conditions 5.3.4 (Rights Issues of Shares or Options over Shares) or 5.3.6

(Issues at Less than Current Market Price) in circumstances where the

relevant event relates to an issue of Ordinary Shares if at any time during the

said 20 Trading Day-period (which may be on each of such 20 Trading Days)

the Ordinary Shares of such class shall have been quoted ex-dividend (or ex-

any other entitlement) and/or during some other part of that period (which

may be on each of such 20 Trading Days) the Ordinary Shares of such class

shall have been quoted cum-dividend (or cum- any other entitlement) then:

(i) if the Ordinary Shares of such class to be issued or transferred and

delivered do not rank for the dividend (or entitlement) in question the

Closing Price on the dates on which the Ordinary Shares of such class

shall have been based on a price cum-dividend (or cum-any other

entitlement) shall for the purpose of this definition be deemed to be the

amount thereof reduced by an amount equal to the Fair Market Value

of any such dividend or entitlement per Ordinary Shares of such class; or

(ii) if the Ordinary Shares of such class to be issued or transferred and

delivered rank for the dividend or entitlement in question the Closing

Price on the dates on which the Ordinary Shares of such class shall have

been based on a price ex-dividend (or ex-any other entitlement) shall for

the purpose of this definition be deemed to be the amount thereof

increased by the Fair Market Value of any such dividend or entitlement

per Ordinary Shares of such class

– 114 –(B) for the purpose of determining the Current Market Price of any Ordinary

Shares of any class which are to be issued or may be issued pursuant to a

Scrip Dividend pursuant to Condition 5.3.2(ii) if on any day during the said

20 Trading Day-period the Volume Weighted Average Price of the Ordinary

Shares of such class shall have been based (A) on a price cum the Relevant

Cash Dividend (and/or any other dividend or other entitlement which the

Ordinary Shares of such class that may be issued pursuant to terms of such

Scrip Dividend do not rank for) the Volume Weighted Average Price of an

Ordinary Share of such class on any such day shall for the purposes of this

definition be deemed to be the amount thereof reduced by an amount equal

to the Fair Market Value of the Relevant Cash Dividend (and/or such other

dividend or other entitlement) (as at the date of first public announcement of

the terms of such Relevant Cash Dividend) per Ordinary Share of such class

entitled to the Relevant Cash Dividend (and/or such other dividend or other

entitlement) or (B) on a price ex- the Relevant Cash Dividend the Volume

Weighted Average Price of an Ordinary Share of such class on any such day

shall for the purposes of this definition be deemed to be the amount thereof

(x) multiplied by the sum of one and the number of Ordinary Shares of such

class which are to be issued or may be issued pursuant to such Scrip Dividend

per Ordinary Share of such class entitled to the Relevant Cash Dividend and

(y) reduced by the Fair Market Value of the Relevant Cash Dividend (as at

the date of first public announcement of the terms of such Relevant Cash

Dividend) per Ordinary Share of such class entitled to the Relevant Cash

Dividend; and

(C) for any other purpose if any day during the said 20 Trading Day-period was

the ex-date in relation to any dividend (or any other entitlement) the Volume

Weighted Average Prices that shall have been based on a price cum- such

dividend (or cum- such entitlement) shall for the purpose of this definition be

deemed to be the amount thereof reduced by an amount equal to the Fair

Market Value of any such dividend (or other entitlement) per Ordinary Share

of such class as at the date of first public announcement of the terms of such

dividend (or other entitlement);

“Capital Distribution” means on a per Ordinary Share basis

(i) any distribution of assets in specie by the Issuer for any financial period

whenever paid or made and however described (and for these purposes a

distribution of assets in specie includes without limitation an issue of

Ordinary Shares or other securities credited as fully or partly paid by way of

capitalisation of reserves but excludes any Ordinary Shares credited as fully

paid to the extent an adjustment to the Conversion Price is made in respect

thereof under Condition 5.3.2(i) and a Scrip Dividend adjusted for under

Condition 5.3.2(ii)); and

(ii) any cash dividend or distribution on a gross basis (including without

limitation the relevant cash amount of a Scrip Dividend) of any kind by the

Issuer for any financial period (whenever paid and however described)

translated into HK dollars at the Prevailing Rate as at the effective date of

the relevant adjustment to the Conversion Price

– 115 –provided that a purchase or redemption of Ordinary Shares by or on behalf of

the Issuer (or a purchase of Ordinary Shares by or on behalf of a Subsidiary

of the Issuer) shall not constitute a Capital Distribution unless the weighted

average price (before expenses) on any one day in respect of such purchases

exceeds the Current Market Price of the Ordinary Shares by more than five

per cent. either (a) on that date or (b) where an announcement has been

made of the intention to purchase Ordinary Shares at some future date at a

specified price on the Trading Day immediately preceding the date of such

announcement and if in the case of either (a) or (b) of this definition the

relevant day is not a Trading Day the immediately preceding Trading Day

in which case such purchase or redemption shall be deemed to constitute a

Capital Distribution in an amount equal to the amount by which the

aggregate consideration paid (before expenses) in respect of such Ordinary

Shares purchased or redeemed exceeds the product of 105 per cent. of such

Current Market Price and the number of Ordinary Shares so purchased or

redeemed;

“Fair Market Value” means with respect to any asset security option warrant or

other right on any date the fair market value of that asset security option

warrant or other right as determined by an Independent Financial Advisor on the

basis of commonly accepted market valuation method and taking into account

such factors as it considers appropriate provided that an Independent Financial

Advisor will not be required to determine the fair market value where (i) the

Capital Distribution is paid in cash in which case the fair market value of such

cash Capital Distribution per Ordinary Share of the relevant class shall be the

amount of such cash Capital Distribution per Ordinary Share of such class

determined as at the date of announcement of such cash Capital Distribution and

(ii) any other amounts are paid in cash in which case the fair market value of such

cash amount shall be the amount of cash and (iii) options warrants or other

rights or securities are or will upon issuance be publicly traded in a market of

adequate liquidity (as determined by such Independent Financial Advisor) the

fair market value of such options warrants or other rights or securities shall equal

the arithmetic mean of the daily closing prices of such options warrants or other

rights or securities during the period of five trading days on the relevant market

commencing on the first such trading day such options warrants or other rights

or securities are publicly traded. Such amounts if expressed in a currency other

than HK dollars shall be translated into HK dollars (a) in the case of any cash

Capital Distribution at the average benchmark exchange rate between Renminbi

and HK dollars expressed to be used in respect of such cash Capital Distribution

and (b) in any other case at the Prevailing Rate on such date. In addition in the

case of provisos (i) and (ii) above of this definition the Fair Market Value shall be

determined on a gross basis and disregarding any withholding or deduction

required to be made for or on account of tax and disregarding any associated tax

credit;

“Hong Kong Stock Exchange” means The Stock Exchange of Hong Kong Limited

or any successor thereto;

“H Share Stock Exchange Business Day” means any day (other than a Saturday or

Sunday) on which the Hong Kong Stock Exchange or the Alternative Stock

Exchange (as the case may be) is open for the business of dealing in securities;

– 116 –“Independent Financial Advisor” means an independent investment bank or

licensed financial advisor or institution of international repute (acting as an

expert) selected and appointed at its own cost by the Issuer and notified in writing

to the Trustee. The Trustee shall not be responsible for or under any obligation to

appoint an Independent Financial Advisor and shall have no responsibility or

liability for verifying any calculation determination certification advice or

opinion made given or reached by it;

“Prevailing Rate” means in respect of any currency on any day the spot mid-rate

of exchange between the relevant currencies prevailing as at or about 12 : 00 noon

(Hong Kong time) on that date as appearing on or derived from the Relevant Page

or if such a rate cannot be determined at such time the rate prevailing as at or

about 12 : 00 noon (Hong Kong time) on the immediately preceding day on which

such rate can be so determined provided that in the case of any cash Capital

Distribution in respect of the H Shares the “Prevailing Rate” shall be deemed to

be the average benchmark exchange rate between Renminbi and HK dollars

calculated in the manner as announced by the Issuer on the Hong Kong Stock

Exchange from time to time;

“Relevant Cash Dividend” means the aggregate cash dividend or distribution

declared by the Issuer including any cash dividend in respect of which there is any

Scrip Dividend;

“Relevant Page” means the relevant Bloomberg BFIX page (or its successor page)

or if there is no such page on the relevant Reuters HKDFIX page (or its

successor page) or such other information service provider that displays the

relevant information;

“Scrip Dividend” means Ordinary Shares of any class issued in lieu of the whole or

any part of any Relevant Cash Dividend being a dividend which the Ordinary

Shareholders concerned would or could otherwise have received and which would

not have constituted a Capital Distribution (and for the avoidance of doubt no

adjustment is to be made under Condition 5.3.3 (Capital Distributions) in respect

of the amount by which the Current Market Price of the Ordinary Shares exceeds

the Relevant Cash Dividend or the relevant part thereof but without prejudice to

any adjustment required in such circumstances to be made under Condition 5.3.2

(Capitalisation of Profits or Reserves));

“Shenzhen Stock Exchange” means The Shenzhen Stock Exchange;

“Trading Day” means in respect of an Ordinary Share of a class a day when the

principal stock exchange of such Ordinary Share is open for dealing business and

in the case of the A Shares shall (unless otherwise determined at the relevant

time) mean the Shenzhen Stock Exchange and in the case of the H Shares shall

(unless otherwise determined at the relevant time) mean the Hong Kong Stock

Exchange; provided that for the purposes of any calculation where a Closing Price

is required if no Closing Price is reported for one or more consecutive dealing

days such day or days will be disregarded in any relevant calculation and shall be

deemed not to have been dealing days when ascertaining any period of dealing

days; and

– 117 –“Volume Weighted Average Price” means in relation to an H Share for any H

Share Stock Exchange Business Day the order book volume-weighted average

price of an H Share for such H Share Stock Exchange Business Day appearing on

or derived from Bloomberg screen page “763 HK Equity VAP” (or its successor

page) or if not available on any of such screens from such other source as shall be

determined in good faith and in a commercially reasonable manner using a

volume-weighted average method to be appropriate by an Independent Financial

Advisor provided that for any H Share Stock Exchange Business Day where such

price is not available or cannot otherwise be determined as provided above the

Volume Weighted Average Price of an H Share in respect of such H Share Stock

Exchange Business Day shall be the Volume Weighted Average Price determined

as provided above on the immediately preceding H Share Stock Exchange

Business Day on which the same can be so determined.References to any issue or offer or grant to Ordinary Shareholders “as a class” or

“by way of rights” shall be taken to be references to an issue or offer or grant to

all or substantially all Ordinary Shareholders other than Ordinary Shareholders

by reason of the laws of any territory or requirements of any recognised

regulatory body or any other stock exchange or securities market in any territory

or in connection with fractional entitlements it is determined not to make such

issue or offer or grant.

6 PAYMENTS

6.1 U.S. dollar settlement

All amounts due under and all claims arising out of or pursuant to the Bonds

and/or the Trust Deed from or against the Issuer shall be payable and settled in

U.S. dollars only.For the purposes of these Conditions “U.S. Dollar Equivalent” means in respect

of a Renminbi-denominated amount that but for this Condition 6.1 would be

due under the Bonds in Renminbi the Renminbi amount converted into U.S.dollars using the Spot Rate for the relevant Rate Calculation Date (as defined

below) as determined by the Issuer. The Issuer shall notify the Trustee and the

Principal Agent such U.S. Dollar Equivalent immediately after determination and

in any event by no later than 5 : 00 p.m. (Hong Kong time) on the relevant Rate

Calculation Date.For the purpose of this Condition 6.1 :

“Business Day” means a day (other than a Saturday or a Sunday or a public

holiday) on which banks are open for business in Hong Kong Beijing and New

York;

“Rate Calculation Date” means the day which is two Business Days before the due

date of the relevant amount under these Conditions;

“Reference Dealers” means four leading dealers engaged in the foreign exchange

market of the relevant currency selected by the Issuer;

– 118 –“Spot Rate” means for each Rate Calculation Date a rate determined by the

Issuer as follows:

(a) in respect of the US dollar and Renminbi the USD/CNH spot mid-rate of

exchange expressed as the amount of Renminbi per one US dollar reported

by the Hong Kong Treasury Markets Association which appears on the

Bloomberg page “BFIX” at approximately 12 : 00 p.m. (Hong Kong time) on

the Rate Calculation Date or any such other source as the Issuer may

determine which displays such rate;

(b) if no such rate is available under sub-paragraphs (a) of this definition the

Spot Rate determined by the Issuer on the basis of quotations provided by

the Reference Dealers of the specified exchange rate for the Rate Calculation

Date as obtained in accordance with the provisions below or if fewer than

two quotations are provided the exchange rate for the Rate Calculation Date

as shall be determined by an Independent Financial Advisor in good faith.In determining the Spot Rate under sub-paragraph (b) of this definition the

Issuer will request the Hong Kong office of each of the Reference Dealers to

provide a quotation of what the specified screen rate would have been had it been

published reported or available for the Rate Calculation Date based upon each

Reference Dealer’s experience in the foreign exchange market for Renminbi and

general activity in such market on the Rate Calculation Date. The quotations used

to determine the Spot Rate under sub-paragraph (a) of this definition for a Rate

Calculation Date will be determined in each case for such Rate Calculation Date

and will be requested on such Rate Calculation Date or as soon as practicable

after it is determined that the specified screen rate was not available.If four quotations are provided the rate for a Rate Calculation Date will be the

arithmetic mean of the rates without regard to the rates having the highest and

lowest value. For this purpose if more than one quotation has the same highest

value or lowest value then the rate of only one of such quotations shall be

disregarded. If two or three quotations are provided the rate for a Rate

Calculation Date will be the arithmetic mean of the rates provided.All notifications opinions determinations certificates calculations quotations

and decisions given expressed made or obtained for the purposes of the

provisions of this Condition 6 (Payments) whether by the Reference Dealers (or

any of them) the Issuer or the Independent Financial Advisor will be binding on

the Issuer the Trustee the Agents and the Bondholders save in the case of

manifest error.

6.2 Principal

Payment of principal premium and interest (if any) will be made by transfer to the

registered account of the Bondholder except in the case of any amount payable by

the Issuer pursuant to Condition 5 (Conversion) where any amounts payable to a

Bondholder will be made by U.S. dollar cheque drawn on a bank that processes

payments in U.S. dollars and mailed directly to the address of the Bondholder or

by transfer to a U.S. dollar account maintained by the payee in either case in

– 119 –accordance with instructions given by the relevant Bondholder in the Conversion

Notice. Such payment will only be made after surrender of the relevant Certificate

at the specified office of any of the Agents.If an amount which is due on the Bonds is not paid in full the Registrar will

annotate the Register with a record of the amount (if any) in fact paid.So long as the Bonds are represented by the Global Certificate and the GlobalCertificate is held on behalf of Euroclear or Clearstream (each a “relevant clearingsystem”) each payment in respect of the Global Certificate will be made to the

person shown as the holder thereof in the Register at the close of business (in the

relevant clearing system) on the Clearing System Business Day before the due date

for such payment where “Clearing System Business Day” means a weekday

(Monday to Friday inclusive) except December 25 and January 1.

6.3 Registered Accounts

For the purposes of this Condition 6 (Payments) a Bondholder’s registered

account means the U.S. dollar account maintained by or on behalf of it with a

bank that processes payments in U.S. dollars details of which appear on the

Register at the close of business on the second Payment Business Day (as defined

in Condition 6.7 (Payment Business Day)) before the due date for payment and a

Bondholder’s registered address means its address appearing on the Register at

that time.

6.4 Fiscal Laws

All payments are subject in all cases to (i) any applicable fiscal or other laws and

regulations in the place of payment but without prejudice to the provisions of

Condition 8 (Taxation) and (ii) any withholding or deduction required pursuant

to an agreement described in Section 1471(b) of the U.S. Internal Revenue Code

of 1986 as amended (the “Code”) or otherwise imposed pursuant to Sections 1471

through 1474 of the Code any regulations or agreements thereunder any official

interpretations thereof or (without prejudice to the provisions of Condition 8

(Taxation)) any law implementing an intergovernmental approach thereto. No

commissions or expenses shall be charged to the Bondholders in respect of such

payments

6.5 Payment Initiation

Payment instructions (for value on the due date or if that is not a Payment

Business Day for value on the first following day which is a Payment Business

Day) will be initiated on the due date for payment (or if it is not a Payment

Business Day the immediately following Payment Business Day) or in the case of

a payment of principal if later on the Payment Business Day on which the

relevant Certificate is surrendered at the specified office of an Agent.– 120 –6.6 Delay in Payment

Bondholders will not be entitled to any interest or other payment for any delay

after the due date in receiving the amount due if the due date is not a Payment

Business Day or if the Bondholder is late in surrendering its Certificate (if

required to do so).

6.7 Payment Business Day

In this Condition 6 (Payments) “Payment Business Day” means a day other than a

Saturday Sunday or public holiday on which commercial banks and foreign

exchange markets are generally open for business in New York City and the city in

which the specified office of the Principal Agent is located and in the case of the

surrender of a Certificate in the place where the Certificate is surrendered.

6.8 Rounding

When making payments to Bondholders fraction of one cent will be rounded to

the nearest cent (half a cent being rounded upwards).

6.9 Appointment of Agents

The initial Agents and their initial specified offices are listed below. The Issuer

reserves the right at any time with the prior written approval of the Trustee to

vary or terminate the appointment of any Agent and appoint additional or

replacement Agents provided that the Issuer shall at all times maintain (i) a

Principal Agent (ii) a Registrar (iii) a Transfer Agent (iv) a Conversion Agent

and (v) such other agents as may be required by the stock exchange on which the

Bonds may be listed in each case as approved in writing by the Trustee.Notice of any changes in any Agent or their specified offices will promptly be

given by the Issuer to the Bondholders in accordance with Condition 16 (Notices).

7 REDEMPTION PURCHASE AND CANCELLATION

7.1 Maturity

Unless previously redeemed converted or purchased and cancelled as provided

herein the Issuer will redeem each Bond at the U.S. Dollar Equivalent of its

outstanding principal amount on 5 August 2030 (the “Maturity Date”). The Issuer

may not redeem the Bonds at its option prior to that date except as provided in

Condition 7.2 (Redemption at the Option of the Issuer) or Condition 7.3

(Redemption for Taxation Reasons) below (but without prejudice to Condition 9

(Events of Default)).

– 121 –7.2 Redemption at the Option of the Issuer

The Issuer may having given not less than 30 nor more than 60 days’ notice (an

“Optional Redemption Notice”) to the Bondholders (which notice will be

irrevocable) the Trustee and the Principal Agent redeem all but not some only

of the Bonds at the U.S. Dollar Equivalent of their outstanding principal amount

as at the date fixed for redemption if at any time the aggregate principal amount

of the Bonds outstanding is less than 10 per cent. of the aggregate principal

amount originally issued (including any Bonds issued pursuant to Condition 15

(Further Issues)).

Upon the expiry of the Optional Redemption Notice the Issuer will be bound to

redeem the relevant Bonds at their outstanding principal amount as at the date

fixed for redemption.

7.2.1 Redemption under this Condition 7.2 (Redemption at the Option of the Issuer)

may not occur within seven days of the end of a Restricted Transfer Period

but otherwise may occur when the Conversion Right is expressed in these

Conditions to be exercisable.

7.2.2 The Trustee and the Agents shall have no obligation to confirm whether the

circumstances giving rise to a right for the Issuer to redeem under this

Condition 7.2 (Redemption at the Option of the Issuer) have in any case arisen

and none of them shall be liable to the Bondholders or any other person for

not doing so.

7.3 Redemption for Taxation Reasons

7.3.1 At any time the Issuer may having given not less than 30 nor more than 60

days’ notice to the Trustee the Principal Agent and the Bondholders (which

notice shall be irrevocable) redeem all but not some only of the Bonds at theU.S. Dollar Equivalent of their outstanding principal amount (the “TaxRedemption Date”) as at the date fixed for redemption if the Issuer satisfies

the Trustee immediately prior to the giving of such notice that (i) the Issuer

has or will become obliged to pay Additional Tax Amounts as provided or

referred to in Condition 8 (Taxation) as a result of any change in or

amendment to the laws or regulations of the PRC or Hong Kong or in each

case any political subdivision or any authority thereof or therein having

power to tax or any change in the general application or official

interpretation of such laws or regulations which change or amendment

becomes effective on or after 28 July 2025 and (ii) such obligation cannot be

avoided by the Issuer taking reasonable measures available to it provided

that no such notice of redemption shall be given earlier than 90 days prior to

the earliest date on which the Issuer would be obliged to pay such Additional

Tax Amounts were a payment in respect of the Bonds then due. Prior to the

publication of any notice of redemption pursuant to this Condition 7.3.1 the

Issuer shall deliver to the Trustee (a) a certificate signed by two directors of

the Issuer each of whom are also Authorised Signatories stating that the

obligation referred to in (i) above of this Condition 7.3.1 cannot be avoided

by the Issuer having taken reasonable measures available to it and (b) an

opinion of independent legal or tax advisors of recognised standing in form

– 122 –and substance satisfactory to the Trustee to the effect that such change or

amendment has occurred (irrespective of whether such amendment or change

is then effective) and stating that the Issuer has or will become obliged to pay

such Additional Tax Amounts as a result of such change or amendment and

the Trustee shall be entitled to accept such certificate and opinion as

sufficient evidence thereof in which event the same shall be conclusive and

binding on the Bondholders.

7.3.2 On the Tax Redemption Date the Issuer shall redeem the Bonds at their

outstanding principal amount as at the Tax Redemption Date provided that

redemption under this Condition 7.3 (Redemption for Taxation Reasons) may

not occur within seven days of the end of a Restricted Transfer Period but

otherwise may occur when the Conversion Right is expressed in these

Conditions to be exercisable.

7.3.3 If the Issuer gives a notice of redemption pursuant to this Condition 7.3

(Redemption for Taxation Reasons) each Bondholder will have the right to

elect that his Bond(s) shall not be redeemed and that the provisions of

Condition 8 (Taxation) shall not apply in respect of any payment of principal

or interest (if any) to be made in respect of such Bond(s) which falls due after

the relevant Tax Redemption Date whereupon no Additional Tax Amounts

shall be payable in respect thereof pursuant to Condition 8 (Taxation) and

payment of all amounts shall be made subject to the deduction or

withholding of the taxation required to be withheld or deducted by the

government of the PRC or Hong Kong or in each case any political

subdivision or any authority thereof or therein having power to tax. For the

avoidance of doubt any Additional Tax Amounts which had been payable in

respect of the Bonds as a result of the laws or regulations of the government

of the PRC or Hong Kong or in each case any authority thereof or therein

having power to tax prior to 28 July 2025 will continue to be payable to such

Bondholders. To exercise such right the holder of the relevant Bond must

complete sign and deposit at the specified office of any Paying Agent during

normal business hours (being between 9.00 a.m. (Hong Kong time) and 3.00

p.m. (Hong Kong time) Monday to Friday except for public holidays) a duly

completed and signed notice of election in the form for the time being

current obtainable from the specified office of any Paying Agent together

with the Certificate evidencing the Bonds on or before the day falling 10 days

prior to the Tax Redemption Date. Such notice of election once delivered

shall be irrevocable and may not be withdrawn without the Issuer’s consent.

7.4 Redemption at the Option of the Bondholders

The holder of each Bond will have the right at such holder’s option to require the

Issuer to redeem all or some only of that holder’s Bonds on 5 August 2028 (the

“Put Option Date”) at the U.S. Dollar Equivalent of their outstanding principal

amount on the Put Option Date. To exercise such right the holder of the relevant

Bond must complete sign and deposit at the specified office of any Paying Agent

during normal business hours (being between 9.00 a.m. (Hong Kong time) and

3.00 p.m. (Hong Kong time) Monday to Friday except for public holidays) a duly

completed and signed notice (the “Put Option Notice”) substantially in the form

scheduled to the Agency Agreement obtainable from the specified office of any

– 123 –Paying Agent together with the Certificate evidencing the Bonds to be redeemed

not earlier than 60 days and not later than 30 days prior to the Put Option Date. A

Bond may not be redeemed unless the principal amount of such Bond to be

redeemed and (where not all of the Bonds held by a holder are being redeemed)

the principal amount of the balance of such Bond not being redeemed are equal to

an Authorised Denomination.A Put Option Notice once delivered shall be irrevocable (and may not be

withdrawn unless the Issuer consents to such withdrawal) and the Issuer shall

redeem the Bonds the subject of a Put Option Notice delivered as aforesaid on the

Put Option Date.

7.5 Redemption for Relevant Events

7.5.1 Following the occurrence of a Relevant Event (as defined in Condition

7.5.5(vi)) the holder of each Bond will have the right at such holder’s option

to require the Issuer to redeem all or some only of such holder’s Bonds on the

Relevant Event Put Date (as defined below) at the U.S. Dollar Equivalent of

their outstanding principal amount as at the Relevant Event Put Date. To

exercise such right the holder of the relevant Bond must complete sign and

deposit at the specified office of any Paying Agent during normal business

hours (being between 9.00 a.m. (Hong Kong time) and 3.00 p.m. (Hong Kong

time) Monday to Friday except for public holidays) a duly completed and

signed notice of redemption substantially in the form scheduled to the

Agency Agreement obtainable from the specified office of any Paying Agent

(a “Relevant Event Put Exercise Notice”) together with the Certificate

evidencing the Bonds to be redeemed by not later than 30 days following a

Relevant Event or if later 30 days following the date upon which notice

thereof is given to Bondholders by the Issuer in accordance with Condition

16 (Notices). The “Relevant Event Put Date” shall be the fourteenth day after

the expiry of such period of 30 days as referred to above in this Condition

7.5.1. A Bond may not be redeemed unless the principal amount of such

Bond to be redeemed and (where not all of the Bonds held by a holder are

being redeemed) the principal amount of the balance of such Bond not being

redeemed are equal to an Authorised Denomination.

7.5.2 A Relevant Event Put Exercise Notice once delivered shall be irrevocable

and may not be withdrawn without the Issuer’s consent. The Issuer shall

redeem the Bonds which form the subject of the Relevant Event Put Exercise

Notices delivered as aforesaid (subject to delivery of the relevant Certificates)

on the Relevant Event Put Date.

7.5.3 None of the Trustee or the Agents shall be required to monitor or take any

steps to ascertain whether a Relevant Event or any event which could lead to

the occurrence of a Relevant Event has occurred or may occur and none of

them shall be liable to Bondholders or any other person for not doing so.– 124 –7.5.4 Not later than 14 days after becoming aware of a Relevant Event the Issuer

shall procure that notice regarding the Relevant Event shall be delivered to

Bondholders (in accordance with Condition 16 (Notices)) and to the Trustee

and the Principal Agent in writing stating:

(i) the Relevant Event Put Date;

(ii) the date of such Relevant Event and briefly the events causing such

Relevant Event;

(iii) the date by which the Relevant Event Put Exercise Notice must be given;

(iv) the redemption amount and the method by which such amount will be

paid;

(v) the names and addresses of all Paying Agents;

(vi) briefly the Conversion Right and the then current Conversion Price;

(vii) the procedures that Bondholders must follow and the requirements that

Bondholders must satisfy in order to exercise their rights under this

Condition 7.5 (Redemption for Relevant Events) or their Conversion

Right; and

(viii) that a Relevant Event Put Exercise Notice once validly given may not

be withdrawn without the Issuer’s consent.

7.5.5 For the purposes of this Condition 7.5 (Redemption for Relevant Events):

(i) “control” means the acquisition or control of more than 50 per cent. of

the voting rights of the registered share capital of the Issuer or the right

to appoint and/or remove all or the majority of the members of the

Issuer’s board of directors or other governing body whether obtained

directly or indirectly and whether obtained by ownership of share

capital the possession of voting rights contract or otherwise;

(ii) a “Change of Control” occurs when:

(a) any person or persons acting together acquires control of the

Issuer; or

(b) the Issuer consolidates with or merges into or sells or transfers all

or substantially all of its assets to any other person or persons

acting together unless the consolidation merger sale or transfer

will not result in any person acquiring control over the Issuer or the

successor entity.(iii) a “Delisting” occurs when the H Shares cease to be listed or admitted to

trading on the Hong Kong Stock Exchange or the Alternative Stock

Exchange (as the case may be);

– 125 –(iv) an “H Share Suspension in Trading” means the suspension in trading of

the H Shares for a period of 30 consecutive H Share Stock Exchange

Business Days;

(v) a “person” includes any individual company corporation firm

partnership joint venture undertaking association organisation

trust state or agency of a state (in each case whether or not being a

separate legal entity) but does not include the Issuer’s board of directors

or any other governing board and does not include the Issuer’s

wholly-owned direct or indirect Subsidiaries;

(vi) a “Relevant Event” means the occurrence of either (a) a Change of

Control in the Issuer; (b) a Delisting or (c) an H Share Suspension in

Trading; and

(vii) “voting rights” means the right generally to vote at general meetings of

shareholders of the Issuer (irrespective of whether or not at the time

stock of any other class or classes shall have or might have voting

power by reason of the happening of any contingency).

7.6 Purchases

The Issuer or any of its Subsidiaries may subject to applicable laws and

regulations at any time and from time to time purchase Bonds at any price in the

open market or otherwise. The Bonds so acquired while held by or on behalf of

the Issuer or any such Subsidiary shall not entitle them to convert the Bonds in

accordance with these Conditions nor shall such Bonds be deemed to be

outstanding for the purposes of among other things calculating quorums at

meetings of the Bondholders and exercising any voting rights with respect to such

Bonds and Conditions 9 (Events of Default) and 13 (Enforcement).

7.7 Cancellation

All Bonds which are repurchased redeemed or converted or purchased by or on

behalf of the Issuer will forthwith be cancelled. Certificates in respect of all Bonds

cancelled will be forwarded to or to the order of the Registrar and such Bonds

may not be reissued or resold. For the avoidance of doubt all or any Bonds which

are purchased by or on behalf of the Issuer’s Subsidiaries may be resold in any

manner and at any price in compliance with relevant laws and regulations

(including any applicable rules of the relevant stock exchange).

7.8 Redemption Notices

All notices to Bondholders given by or on behalf of the Issuer pursuant to this

Condition 7 (Redemption Purchase and Cancellation) will be irrevocable and will

be given in accordance with Condition 16 (Notices) specifying: (i) the Conversion

Price as at the date of the relevant notice; (ii) the last day on which Conversion

Rights may be exercised; (iii) the principal and/or premium (if any) as at the

relevant redemption date payable; (iv) the date fixed for redemption; (v) the

– 126 –manner in which redemption will be effected; and (vi) the aggregate principal

amount of the Bonds outstanding as at the latest practicable date prior to the

publication of the notice.If more than one notice of redemption is given (being a notice given by either the

Issuer or a Bondholder pursuant to these Conditions) the first in time shall

prevail.Neither the Trustee nor any of the Agents shall be responsible for calculating or

verifying the calculations of any amount payable on redemption of the Bonds

pursuant to this Condition 7 (Redemption Purchase and Cancellation) or have any

duty to verify the accuracy content completeness validity and/or genuineness of

any certificates confirmations or documents in relation to or in connection to any

such redemption or the exercise of any right of redemption or to require

redemption and none of them shall be liable to the Bondholders or any other

person for not doing so.

8 TAXATION

8.1 All payments made by or on behalf of the Issuer in respect of the Bonds will be

made free from any set-off counterclaim restriction or condition and will be

made without deduction or withholding for or on account of any present or future

taxes duties assessments or governmental charges of whatever nature imposed

levied collected withheld or assessed by or on behalf of the PRC or Hong Kong

or in each case any authority thereof or therein having power to tax unless

deduction or withholding of such taxes duties assessments or governmental

charges is compelled by law. Where such withholding or deduction is made by the

Issuer by or within the PRC up to and including the aggregate rate applicable on

28 July 2025 (the “Applicable Rate”) the Issuer will increase the amounts paid by

it to the extent required so that the net amount received by Bondholders equals

the amounts which would otherwise have been receivable by them had no such

withholding or deduction been required. If the Issuer is required to make a

deduction or withholding in respect of PRC tax in excess of the Applicable Rate

or any Hong Kong deduction or withholding is required in such event the Issuer

shall pay such additional amounts (“Additional Tax Amounts”) as will result in

receipt by the Bondholders of such amounts as would have been received by them

had no such withholding or deduction been required except that no Additional

Tax Amounts shall be payable in respect of any Bond:

8.1.1 to a holder (or to a third party on behalf of a holder) who is subject to such

taxes duties assessments or governmental charges in respect of such Bond

by reason of his having some connection with the PRC or Hong Kong as the

case may be otherwise than merely by holding the Bond or by the receipt of

amounts in respect of the Bond or where the withholding or deduction could

be avoided by the holder making a declaration of non-residence or other

similar claim for exemption to the appropriate authority which such holder is

legally capable and competent of making but fails to do so; or

– 127 –8.1.2 where the withholding or deduction could be avoided by the holder or

beneficial owner making a declaration of non-residence or other similar claim

for exemption to the appropriate authority or any other person which such

holder is legally capable and competent of making but fails to do so; or

8.1.3 (in the case of a payment of principal) if the Certificate in respect of such

Bond is surrendered more than 30 days after the Relevant Date except to the

extent that the holder would have been entitled to such additional amount on

surrendering the relevant Certificate for payment on the last day of such

period of 30 days.

8.2 “Relevant Date” means whichever is the later of (i) the date on which such

payment first becomes due and (ii) if the full amount payable has not been

received by the Trustee or the Principal Agent on or prior to such due date the

date on which the full amount having been so received notice to that effect shall

have been given to the Bondholders and payment made.

8.3 References in these Conditions to principal premium and interest (if any) shall be

deemed also to refer to any additional amounts or premiums which may be

payable under these Conditions or any undertaking or covenant given in addition

thereto or in substitution therefor pursuant to the Trust Deed.

8.4 Neither the Trustee nor any Agent shall be responsible for paying any tax duty

charges withholding or other payment referred to in this Condition 8 (Taxation)

or for determining whether such amounts are payable or the amount thereof and

none of them shall be responsible or liable for any failure by the Issuer any

Bondholder or any third party to pay such tax duty charges withholding or

other payment in any jurisdiction or to provide any notice or information to the

Trustee or any Agent that would permit enable or facilitate the payment of any

principal premium (if any) interest or other amount under or in respect of the

Bonds without deduction or withholding for or on account of any tax duty

charge withholding or other payment imposed by or in any jurisdiction.

9 EVENTS OF DEFAULT

The Trustee at its discretion may and if so requested in writing by the holders of not

less than 25 per cent. in aggregate principal amount of the Bonds then outstanding or if

so directed by an Extraordinary Resolution shall (subject in any such case to being

indemnified and/or secured and/or pre-funded to its satisfaction) give notice to the

Issuer that the Bonds are and they shall accordingly thereby become immediately due

and repayable at the U.S. Dollar Equivalent of their principal amount (subject as

provided below and without prejudice to the right of Bondholders to exercise the

Conversion Right in respect of their Bonds in accordance with Condition 5

(Conversion)) if any of the following events (each an “Event of Default”) has occurred:

9.1 Non-Payment: the Issuer fails to pay the principal or premium (if any) on any of

the Bonds when due; or

9.2 Default on Conversion: failure by the Issuer to deliver the H Shares; or

– 128 –9.3 Breach of Other Obligations: the Issuer does not perform or comply with one or

more of its other obligations in the Bonds or the Trust Deed which default is in

the opinion of the Trustee incapable of remedy or if capable of remedy in the

opinion of the Trustee is not remedied within 30 days after written notice of such

default shall have been given to the Issuer by the Trustee; or

9.4 Insolvency: the Issuer or any Principal Subsidiary is (or is or could be deemed by

law or a court to be) insolvent or bankrupt or unable to pay its debts stops

suspends or threatens to stop or suspend payment of all or a substantial part of

(or of a particular type of) its debts proposes or makes any agreement for the

deferral rescheduling or other readjustment of all or a substantial part of (or of a

particular type of) its debts proposes or makes a general assignment or an

arrangement or composition with or for the benefit of the relevant creditors in

respect of any of such debts or a moratorium is agreed or declared in respect of or

affecting all or any part of (or of a particular type of) the debts of the Issuer or

any Principal Subsidiary; or

9.5 Cross-Acceleration: (i) any other present or future indebtedness of the Issuer or

any of its Principal Subsidiaries for or in respect of moneys borrowed or raised

becomes due and payable prior to its stated maturity by reason of any actual or

potential default event of default or the like (howsoever described) or (ii) any

such indebtedness is not paid when due or as the case may be within any

applicable grace period and in each case such default continues for more than 10

days after the expiration of any grace period or extension of time for payment

applicable thereto; provided that any such Event of Default shall be deemed cured

and not continuing upon payment of such indebtedness rescission of such

declaration of acceleration or waiver or with consent of the applicable lender or

(iii) the Issuer or any of its Principal Subsidiaries fails to pay when due any

amount payable by it under any present or future guarantee for or indemnity in

respect of any present or future indebtedness in respect of moneys borrowed or

raised provided that the aggregate amount of the relevant indebtedness

guarantees and indemnities in respect of which one or more of the events

mentioned above in this Condition 9.5 (Cross-Acceleration) have occurred equals

or exceeds U.S.$50 million or its equivalent (as determined on the basis of the

middle spot rate for the relevant currency against the U.S. dollar as quoted by any

leading bank on the day on which such indebtedness become due and payable or is

not paid or any such amount become due and payable or is not paid under any

such guarantee or indemnity); or

9.6 Enforcement Proceedings: a distress attachment execution or other legal process

is levied enforced or sued out on or against any material part of the property

assets or revenues of the Issuer or any of its Principal Subsidiaries and is not

discharged or stayed within 60 days; or

9.7 Winding-up: an order is made or an effective resolution passed for the winding-up

or dissolution judicial management or administration of the Issuer or any

Principal Subsidiary or the Issuer or any Principal Subsidiary ceases or threatens

to cease to carry on all or substantially all of its business or operations except for

the purpose of and followed by a reconstruction amalgamation reorganisation

merger or consolidation (i) on terms approved by an Extraordinary Resolution of

– 129 –the Bondholders or (ii) in the case of a Principal Subsidiary whereby the

undertaking and assets of such Principal Subsidiary are transferred to or

otherwise vested in the Issuer or another Principal Subsidiary; or

9.8 Security Enforced: any mortgage charge pledge lien or other encumbrance

present or future created or assumed by the Issuer or any of its Principal

Subsidiaries on any material part of their respective property assets or revenues

becomes enforceable and any step is taken to enforce it (including the taking of

possession or the appointment of a receiver manager or other similar person) and

is not discharged within 60 days; or

9.9 Illegality: it is or will become unlawful for the Issuer to perform or comply with

any one or more of its obligations under any of the Bonds or the Trust Deed; or

9.10 Authorisation and Consents: any action condition or thing (including the

obtaining or effecting of any necessary consent approval authorisation

exemption filing licence order recording or registration) at any time required

to be taken fulfilled or done by the Issuer in order (i) to enable the Issuer lawfully

to enter into exercise its rights and perform and comply with its obligations under

the Bonds and the Trust Deed (ii) to ensure that those obligations are legally

binding and enforceable and (iii) to make the Bonds and the Trust Deed

admissible in evidence in the courts of the PRC or Hong Kong is not taken

fulfilled or done; or

9.11 Nationalisation: any step is taken by any person with a view to the seizure

compulsory acquisition expropriation or nationalisation of all or a substantial

part of the assets of the Issuer or any Principal Subsidiary; or

9.12 Analogues Event: any event occurs which under the laws of any relevant

jurisdiction has an analogous effect to any of the events referred to in any of

Conditions 9.6 (Enforcement Proceedings) to 9.8 (Security Enforced) (both

inclusive) or Condition 9.11 (Nationalisation).The Trustee and the Agents shall not be bound to take any steps to ascertain

whether any Event of Default or any condition event or act which with the giving

of notice and/or the lapse of time and/or fulfilment of any other conditions and/or

the making of any determination would constitute an Event of Default has

happened and none of them shall be responsible or liable to Bondholders or any

other person for not doing so.

9.13 For purposes of this Condition 9 (Events of Default) “Principal Subsidiary”

means any Subsidiary of the Issuer:

(i) whose total revenue (consolidated in the case of a Subsidiary which itself has

Subsidiaries) as shown by its latest audited income statement is at least 5

percent of the consolidated total revenue as shown by the latest published

audited income statement of the Issuer and its consolidated Subsidiaries; or

(ii) whose total assets (consolidated in the case of a Subsidiary which itself has

Subsidiaries) as shown by its latest audited balance sheet are at least 5

percent of the consolidated total assets of the Issuer and its Subsidiaries as

– 130 –shown by the latest published audited consolidated balance sheet of the

Issuer and its Subsidiaries including the investment of the Issuer and its

consolidated Subsidiaries in each Subsidiary whose accounts are not

consolidated with the consolidated audited accounts of the Issuer and of

associated companies and after adjustment for minority interests;

provided that in relation to paragraphs (i) and (ii) above of this definition:

(a) in the case of a corporation or other business entity becoming a

Subsidiary after the end of the financial period to which the latest

consolidated audited accounts of the Issuer relate the reference to the

then latest consolidated audited accounts of the Issuer and its

Subsidiaries for the purposes of the calculation above shall until

consolidated audited accounts of the Issuer for the financial period in

which the relevant corporation or other business entity becomes a

Subsidiary are published be deemed to be a reference to the then latest

consolidated audited accounts of the Issuer and its Subsidiaries adjusted

to consolidate the latest audited accounts (consolidated in the case of a

Subsidiary which itself has Subsidiaries) of such Subsidiary in such

accounts;

(b) if at any relevant time in relation to the Issuer or any Subsidiary which

itself has Subsidiaries no consolidated accounts are prepared and

audited total revenue or total assets of the Issuer and/or any such

Subsidiary shall be determined on the basis of pro forma consolidated

accounts prepared for this purpose by or on behalf of the Issuer;

(c) if at any relevant time in relation to any Subsidiary no accounts are

audited its total assets (consolidated if appropriate) shall be

determined on the basis of pro forma accounts (consolidated if

appropriate) of the relevant Subsidiary prepared for this purpose by

or on behalf of the Issuer; and

(d) if the accounts of any Subsidiary (not being a Subsidiary referred to in

proviso (i) above) are not consolidated with those of the Issuer then the

determination of whether or not such Subsidiary is a Principal

Subsidiary shall be based on a pro forma consolidation of its accounts

(consolidated if appropriate) with the consolidated accounts

(determined on the basis of the foregoing) of the Issuer; or

(iii) to which is transferred the whole or substantially the whole of the assets of a

Subsidiary which immediately prior to such transfer was a Principal

Subsidiary whereupon the Principal Subsidiary which so transfers its

assets shall forthwith upon such transfer cease to be a Principal Subsidiary

and the Subsidiary to which the assets are so transferred shall immediately

become a Principal Subsidiary provided that on or after the date on which

the first published audited accounts (consolidated if appropriate) of the

Issuer prepared as of a date later than such transfer are issued whether or

not such transferor Subsidiary or transferee Subsidiary would continue to be

a Principal Subsidiary shall be determined on the basis of such accounts by

virtue of the provisions of (i) or (ii) above;

– 131 –A certificate signed by an Authorised Signatory stating that in their opinion a

Subsidiary is or is not or was or was not a Principal Subsidiary shall in the

absence of manifest error be conclusive and binding on all parties.

10 PRESCRIPTION

Claims in respect of amounts due in respect of the Bonds will become prescribed and

void unless made within 10 years (in the case of principal) and five years (in the case of

interest if any) from the Relevant Date in respect thereof.

11 MEETINGS OF BONDHOLDERS MODIFICATION AND WAIVER

11.1 Meetings

The Trust Deed contains provisions for convening meetings of Bondholders to

consider any matter affecting their interests including without limitation the

sanctioning by Extraordinary Resolution of a modification of the Bonds or the

provisions of the Trust Deed. Such a meeting may be convened by the Issuer or

the Trustee and shall be convened by the Trustee if requested in writing to do so

by Bondholders holding not less than 10 per cent. in aggregate principal amount

of the Bonds for the time being outstanding and if it is indemnified and/or secured

and/or pre-funded to its satisfaction against all costs and expenses. The quorum at

any such meeting for passing an Extraordinary Resolution will be two or more

persons holding or representing over 50 per cent. in aggregate principal amount of

the Bonds for the time being outstanding or at any adjournment of such meeting

two or more persons being or representing Bondholders whatever the principal

amount of the Bonds so held or represented unless the business of such meeting

includes consideration of proposals inter alia (i) to modify the due date for any

payment in respect of the Bonds (ii) to reduce or cancel the amount of principal

premium interest (if any) or any other amount payable in respect of the Bonds

(iii) to change the currency of payment of the Bonds (iv) to modify or cancel the

Conversion Rights (except by unilateral and unconditional reduction in the

Conversion Price) or the put options specified in Condition 7 (Redemption

Purchase and Cancellation) or (v) to modify the provisions concerning the quorum

required at any meeting of the Bondholders or the majority required to pass an

Extraordinary Resolution including this proviso in which case the necessary

quorum for passing an Extraordinary Resolution will be two or more persons

holding or representing not less than 66 per cent. or at any adjourned such

meeting not less than 25 per cent. in aggregate principal amount of the Bonds for

the time being outstanding. An Extraordinary Resolution passed at any meeting

of Bondholders will be binding on all Bondholders whether or not they are

present at the meeting. The Trust Deed provides that a written resolution signed

by or on behalf of the holders of not less than 90 per cent. of the aggregate

principal amount of Bonds outstanding and/or an Electronic Consent (as defined

in the Trust Deed) shall be as valid and effective as a duly passed Extraordinary

Resolution.– 132 –11.2 Modification and Waiver

The Trustee may (but shall not be obliged to) agree without the consent of the

Bondholders to (i) any modification (except as mentioned in the Trust Deed) to

or the waiver or authorisation of any breach or proposed breach of the Bonds

the Agency Agreement or the Trust Deed which is not in the opinion of the

Trustee materially prejudicial to the interests of the Bondholders or (ii) any

modification to the Bonds the Agency Agreement or the Trust Deed which in the

Trustee’s opinion is of a formal minor or technical nature or to correct a

manifest error or to comply with mandatory provisions of law. Any such

modification waiver or authorisation will be binding on the Bondholders and

unless the Trustee agrees otherwise any such modification waiver or

authorisation will be notified by the Issuer to the Bondholders as soon as

practicable thereafter.

11.3 Interests of Bondholders

In connection with the exercise of its functions rights powers and discretions

(including but not limited to those in relation to any proposed modification

authorisation or waiver) the Trustee shall have regard to the interests of the

Bondholders as a class and shall not have regard to the consequences of such

exercise for individual Bondholders and the Trustee shall not be entitled to

require on behalf of any Bondholder nor shall any Bondholder be entitled to

claim from the Issuer or the Trustee any indemnification or payment in respect of

any tax consequences of any such exercise upon individual Bondholders except to

the extent provided for in Condition 8 (Taxation) and/or any undertakings given

in addition thereto or in substitution therefor pursuant to the Trust Deed.

12 REPLACEMENT OF CERTIFICATES

If any Certificate is mutilated defaced destroyed stolen or lost it may be replaced at

the specified office of the Registrar or any Transfer Agent subject to all applicable

laws and stock exchange requirements upon payment by the claimant of such costs as

may be incurred in connection therewith and on such terms as to evidence and such

indemnity and/or security as the Issuer and/or such Agent may require. Mutilated or

defaced Certificates must be surrendered before replacements will be issued.

13 ENFORCEMENT

At any time when the Bonds become due and payable the Trustee may at its discretion

and without further notice take such steps and/or actions and/or institute such

proceedings against the Issuer as it may think fit to enforce the terms of the Trust Deed

and the Bonds but it need not take any such steps and/or actions and/or institute any

such proceedings unless (i) it shall have been so directed by an Extraordinary

Resolution or shall have been so requested in writing by the holders of not less than 25

per cent. in principal amount of the Bonds then outstanding and (ii) it shall have been

indemnified and/or secured and/or pre-funded to its satisfaction. No Bondholder may

proceed directly against the Issuer unless the Trustee having become bound so to

proceed fails to do so within a reasonable period and such failure is continuing.– 133 –14 INDEMNIFICATION OF THE TRUSTEE

The Trust Deed contains provisions for the indemnification of the Trustee and for its

relief from responsibility including without limitation from taking steps and/or actions

and/or instituting proceedings to enforce payment unless indemnified and/or secured

and/or prefunded of its satisfaction and entitling the Trustee to be paid or reimbursed

for any fees costs expenses indemnity payments and for liabilities incurred by it in

priority to the claims of the Bondholders. The Trustee and its affiliates are entitled to

enter into business transactions with the Issuer and any entity related (directly or

indirectly) to the Issuer without accounting for any profit.The Trustee may rely conclusively without liability to Bondholders or any other person

on any report confirmation or certificate from or any advice or opinion of any legal

counsel accountants financial advisers financial institution or any other expert

whether or not obtained by or addressed to it and whether their liability in relation

thereto is limited (by its terms or by any engagement letter relating thereto entered into

by the Trustee or any other person or in any other manner) by reference to a monetary

cap methodology or otherwise. The Trustee may accept and shall be entitled to rely

conclusively on any such report confirmation certificate advice or opinion in which

case such report confirmation certificate advice or opinion shall be binding on the

Issuer and the Bondholders.Whenever the Trustee is required or entitled by the terms of the Trust Deed or these

Conditions to exercise any discretion or power take any action make any decision or

give any direction the Trustee is entitled prior to exercising any such discretion or

power taking any such action making any such decision or giving any such direction

to seek directions or clarifications of any directions from the Bondholders by way of

Extraordinary Resolution and the Trustee shall not be responsible for any loss or

liability incurred by the Issuer the Bondholders or any other person as a result of any

delay in it exercising such discretion or power taking such action making such

decision or giving such direction or clarifications of any directions as a result of

seeking such direction from the Bondholders or in the event that no direction is given

to the Trustee by the Bondholders.None of the Trustee or any of the Agents shall be responsible for the performance by

the Issuer and any other person appointed by the Issuer in relation to the Bonds of the

duties and obligations on their part expressed in respect of the same and unless it has

written notice from the Issuer to the contrary the Trustee and each Agent shall be

entitled to assume that the same are being duly performed. None of the Trustee or any

Agent shall be liable to any Bondholder or any other person for any action taken by

the Trustee or such Agent in accordance with the instructions of the Bondholders. The

Trustee shall be entitled to rely on any direction request or resolution of Bondholders

given by holders of the requisite principal amount of Bonds outstanding or passed at a

meeting of Bondholders convened and held in accordance with the Trust Deed. Neither

the Trustee nor any of the Agents shall be under any obligation to ascertain whether

any Relevant Event Event of Default or Potential Event of Default has occurred or

may occur or monitor compliance by the Issuer with the provisions of the Trust Deed

the Agency Agreement or these Conditions and none of them shall be responsible or

liable to the Issuer the Bondholders or any other person for not doing so. Each of the

– 134 –Trustee and the Agents shall be entitled to assume that no Relevant Event Event of

Default or Potential Event of Default has occurred until it has received written notice

to the contrary from the Issuer.Each Bondholder shall be solely responsible for making and continuing to make its

own independent appraisal and investigation into the financial condition

creditworthiness condition affairs status and nature of the Issuer and its

Subsidiaries and the Trustee shall not at any time have any responsibility for the

same and each Bondholder shall not rely on the Trustee in respect thereof.

15 FURTHER ISSUES

The Issuer may from time to time without the consent of the Bondholders create and

issue further bonds having the same terms and conditions as the Bonds in all respects

(or in all respects except for the issue date and the timing for complying with the

requirements set out in these Conditions in relation to the Initial NDRC Post-Issuance

Filing the CSRC Post-Issuance Filings and the Foreign Debt Registration) and so that

such further issue shall be consolidated and form a single series with the Bonds. Such

further bonds shall be constituted by a deed supplemental to the Trust Deed.

16 NOTICES

All notices to Bondholders shall be validly given if mailed to them at their respective

addresses in the register of Bondholders maintained by the Registrar or published in a

leading newspaper having general circulation in Asia and so long as the Bonds are

listed on the Hong Kong Stock Exchange and the rules of that stock exchange so

require published in a leading newspaper having general circulation in Hong Kong

(which is expected to be the South China Morning Post). Any such notice shall be

deemed to have been given on the later of the date of such publication and the seventh

day after being so mailed as the case may be.As long as the Bonds are represented by the Global Certificate and the Global Certificate

is held on behalf of Euroclear or Clearstream or an alternative clearing system notices to

Bondholders may be given by delivery of the relevant notice to Euroclear or Clearstream

or the alternative clearing system for communication by it to entitled accountholders in

substitution for notification as required by the Conditions and such delivery shall be

deemed to have been given on the date of delivery to such clearing system.

17 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

No person shall have any right to enforce any term or condition of the Bonds under the

Contracts (Rights of Third Parties) Act 1999 but this is without prejudice to the rights

of Bondholders as contemplated in Condition 13 (Enforcement).

18 GOVERNING LAW AND JURISDICTION

18.1 Governing Law

The Bonds the Trust Deed and the Agency Agreement and any non-contractual

obligations arising out of or in connection with them are governed by and shall be

construed in accordance with English law.– 135 –18.2 Jurisdiction

The courts of Hong Kong are to have exclusive jurisdiction to settle any disputes

which may arise out of or in connection with the Bonds the Trust Deed and the

Agency Agreement and accordingly any legal action or proceedings arising out of

or in connection with the Bonds the Agency Agreement and/or the Trust Deed

(“Proceedings”) may be brought in such courts. Pursuant to the Trust Deed the

Issuer has irrevocably submitted to the jurisdiction of such courts and waives any

objection to Proceedings in such courts on the ground of venue or on the ground

that the Proceedings have been brought in an inconvenient forum.

18.3 Waiver of Immunity

The Issuer has waived any right to claim sovereign or other immunity from

jurisdiction or execution and any similar defence and has irrevocably consented

to the giving of any relief or the issue of any process including without

limitation the making enforcement or execution against any property whatsoever

(irrespective of its use or intended use) of any order or judgment made or given in

connection with any Proceedings.– 136 –SUMMARY OF PROVISIONS RELATING TO THE BONDS IN GLOBAL FORM

The Global Certificate contains provisions which apply to the Bonds in respect of which the

Global Certificate is issued some of which modify the effect of the terms and conditions of

the Bonds set out in this Offering Circular. Terms defined in the Terms and Conditions of

the Bonds have the same meaning in the paragraphs below. The following is a summary of

those provisions:

PROMISE TO PAY

For value received the Issuer promises to pay the registered holder (subject to surrender of

the Global Certificate if no further payment falls to be made in respect of such Bonds) on

such date or dates as the same may become repayable in accordance with the Terms and

Conditions the amount payable upon redemption under the Terms and Conditions

represented by the Global Certificate and (unless the Bonds represented by the certificate do

not bear interest) to pay interest in respect of such Bonds in arrear at the rates on the dates

for payment and in accordance with the method of calculation provided for in the Terms

and Conditions save that the calculation is made in respect of the total aggregate amount

of the Bonds represented by the Global Certificate together with such other sums and

additional amounts (if any) as may be payable under the Terms and Conditions in

accordance with the Terms and Conditions. Each payment will be made to or to the order

of the person whose name is entered on the register at the close of business on the record

date which shall be on the Clearing System Business Day immediately prior to the due date

for payment where “Clearing System Business Day” means a weekday (Monday to Friday

inclusive) except 25 December and 1 January.MEETINGS

For the purposes of any meeting of Bondholders the holder of the Bonds represented by the

Global Certificate will be treated as two persons for the purposes of any quorum

requirements of a meeting of Bondholders and as being entitled to one vote in respect of

each RMB1000000 in principal amount of Bonds.CANCELLATION

On cancellation of any Bond represented by the Global Certificate that is required by the

Terms and Conditions to be cancelled (other than upon its redemption) the Issuer

acknowledges that details of such cancellation shall be entered in the records of the relevant

clearing systems in accordance with the rules and procedures of Euroclear and Clearstream

(or any alternative clearing system as the case may be) and upon any such entry being

made the principal amount of the Bonds recorded in the records of the relevant clearing

systems and represented by the Global Certificate shall be reduced by the aggregate

principal amount of the Bonds so cancelled.TRUSTEE’S POWERS

In considering the interests of Bondholders while the Global Certificate is registered in the

name of a nominee of for a clearing system(s) the Trustee may to the extent it considers it

appropriate to do so in the circumstances but without being obligated to do so (a) have

regard to any information as may have been made available to it by or on behalf of the

relevant clearing system(s) or its operator as to the identity of its accountholders (either

– 137 –individually or by way of category) with entitlements in respect of the Bonds and (b)

consider such interests on the basis that such accountholders were the holders of the Bonds

in respect of which the Global Certificate is issued.CONVERSION

Subject to the requirements of Euroclear and Clearstream (or any alternative clearing

system) the Conversion Right attaching to a Bond in respect of which the Global

Certificate is issued may be exercised by the presentation thereof to or to the order of the

Principal Agent of one or more conversion notices duly completed by or on behalf of a

holder of a book-entry interest in such Bonds. Deposit of the Global Certificate with the

Principal Agent together with the relevant conversion notice(s) shall not be required. The

exercise of the Conversion Right shall be notified by the Principal Agent to the Registrar

and the holder of the Global Certificate.NOTICES

So long as the Bonds are represented by the Global Certificate and the Global Certificate is

held on behalf of Euroclear and Clearstream or any alternative clearing system notices to

be given to Bondholders may be given by their being delivered to Euroclear and

Clearstream or as the case may be any alternative clearing system for communication

by it to accountholders entitled to an interest in the Bonds rather than by publication as

required by the Terms and Conditions and shall be deemed to have been given on the date

of delivery to Euroclear and Clearstream or as the case may be any alternative clearing

system.BONDHOLDER’S REDEMPTION

The Bondholder’s redemption option in Condition 7.4 (Redemption at the Option of the

Bondholders) and Condition 7.5 (Redemption for Relevant Events) may be exercised by the

holder of the Global Certificate giving notice to the Principal Agent of the principal amount

of Bonds in respect of which the relevant option is exercised and presenting this Global

Certificate for endorsement or exercise within the time limits specified in the Terms and

Conditions of the Bonds.Notice of exercise received within the time limits specified in the Terms and Conditions by

the Principal Agent from or on behalf of a holder of a book-entry interest in the relevant

Bonds will be accepted by the Issuer as having been given by the holder as to the principal

amount of Bonds in respect of which it is given (but without double counting) and whether

or not the Global Certificate is presented for endorsement therewith. Following the exercise

of any such option the Issuer shall procure that the principal amount of the Bonds recorded

in the records of Euroclear or Clearstream (or as the case may be any alternative clearing

system) and represented by the Global Certificate shall be reduced accordingly.REDEMPTION AT THE OPTION OF THE ISSUER

The options of the Issuer provided for in Conditions 7.2 (Redemption at the Option of the

Issuer) and 7.3 (Redemption for Taxation Reasons) shall be exercised by the Issuer giving

notice to the Bondholders within the time limits set out in and containing the information

required by the relevant Condition.– 138 –TRANSFERS

Transfers of beneficial interests in the Bonds represented by the Global Certificate will be

effected through the records of Euroclear and Clearstream (or any alternative clearing

system) and their respective participants in accordance with the rules and procedures of

Euroclear and Clearstream (or any alternative clearing system) and their respective direct

and indirect participants.The Global Certificate shall not become valid for any purpose until authenticated by or on

behalf of the Registrar.– 139 –MARKET PRICE INFORMATION

The H shares have been listed on the Hong Kong Stock Exchange (Code: 00763) since the

Issuer’s initial public offering on 9 December 2004. Prior to that time there was no public

market for the Issuer’s H Shares. The Issuer’s publicly traded domestic shares or A Shares

have been listed on the Shenzhen Stock Exchange (Code: 000063.SZ) since 18 November

1997.

The table below sets forth for the periods indicated the high and low closing prices per H

share as reported on the Hong Kong Stock Exchange and per A Share as reported on the

Shenzhen Stock Exchange:

Closing Share Price

H Share A Share

Year High Low High Low

(HK$) (RMB)

2022

First quarter ended 31 March 31 2022 . . . . . . . . . 23.25 12.88 34.58 22.55

Second quarter ended 30 June 2022 . . . . . . . . . . . 18.28 14.88 25.70 21.79

Third quarter ended 30 September 2022 . . . . . . . . 17.70 14.08 25.38 21.24

Fourth quarter ended 31 December 2022 . . . . . . . . 18.20 13.72 26.92 20.52

2023

First quarter ended 31 March 31 2023 . . . . . . . . . 26.40 17.90 36.60 25.49

Second quarter ended 30 June 2023 . . . . . . . . . . . 31.40 22.10 45.54 31.05

Third quarter ended 30 September 2023 . . . . . . . . 31.95 23.10 45.25 32.32

Fourth quarter ended 31 December 2023 . . . . . . . . 23.75 15.94 33.92 24.64

2024

First quarter ended 31 March 31 2024 . . . . . . . . . 17.92 13.58 30.54 21.70

Second quarter ended 30 June 2024 . . . . . . . . . . . 18.12 14.86 28.99 26.46

Third quarter ended 30 September 2024 . . . . . . . . 20.10 14.80 31.15 23.53

Fourth quarter ended 31 December 2024 . . . . . . . . 27.55 18.44 40.99 29.44

2025

First quarter ended 31 March 31 2025 . . . . . . . . . 34.65 21.55 43.80 34.21

Second quarter ended 30 June 2025 . . . . . . . . . . . 24.35 19.44 35.04 30.36

– 140 –EXCHANGE RATE INFORMATION

The PBOC sets and publishes on a daily basis a base exchange rate with reference primarily

to the supply and demand of Renminbi against a basket of currencies in the market during

the prior day. The PBOC also takes into account other factors such as the general

conditions existing in the international foreign exchange markets. On 21 July 2005 the PRC

government introduced a managed floating exchange rate system to allow the value of the

Renminbi to fluctuate within a regulated band based on market supply and demand and by

reference to a basket of currencies. On the same day the value of the Renminbi appreciated

by 2.0 per cent. against the U.S. dollar. The PRC government has since made and in the

future may make further adjustments to the exchange rate system. On 18 May 2007 the

PBOC enlarged effective on 21 May 2007 the floating band for the trading prices in the

inter-bank spot exchange market of Renminbi against the U.S. dollar from 0.3 per cent. to

0.5 per cent. around the central parity rate. This allows the Renminbi to fluctuate against

the U.S. dollar by up to 0.5 per cent. above or below the central parity rate published by the

PBOC. The floating band was further widened to 1.0 per cent. on 16 April 2012. These

changes in currency policy resulted in the Renminbi appreciating against the U.S. dollar by

approximately 26.9 per cent. from 21 July 2005 to 31 December 2013. The PBOC authorised

the China Foreign Exchange Trading Centre effective since 4 January 2006 to announce

the central parity exchange rate of certain foreign currencies against the Renminbi on each

business day. This rate is set as the central parity for the trading against the Renminbi in the

inter-bank foreign exchange spot market and the over-the-counter exchange rate for the

following business day. On 14 March 2014 the PBOC further widened the floating band

against the U.S. dollar to 2.0 per cent. On 11 August 2015 the PBOC announced to improve

the central parity quotations of Renminbi against the U.S. dollar by authorizing

market-makers to provide central parity quotations to the China Foreign Exchange

Trading Centre daily before the opening of the interbank foreign exchange market with

reference to the interbank foreign exchange market closing rate of the previous day the

supply and demand for foreign exchange as well as changes in major international currency

exchange rates. Following the announcement by the PBOC on 11 August 2015 Renminbi

depreciated significantly against the U.S. dollar. In January and February 2016 Renminbi

experienced further fluctuation in value against the U.S. dollar. The PRC government may

adopt further reforms of its exchange rate system in the future.– 141 –The following table sets forth the noon buying rates for U.S. dollars in New York City for

cable transfers payable in Renminbi as certified by the Federal Reserve Bank of New York

for customs purposes for and as at the periods indicated as set forth in the H.10 statistical

release of the Federal Reserve Board.Exchange Rates between Renminbi and U.S. Dollar

Period End Average(1) High Low

(RMB per U.S. $1.00)

2021.................................6.34356.43826.3726

2022.................................6.89726.75187.3084

2023.................................7.09997.08967.7540

2024.................................7.29937.29937.0106

2025

January . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2422 7.2957 7.3326 7.2422

February . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2828 7.2734 7.3088 7.2422

March . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2486 7.2449 7.2843 7.2273

April . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2706 7.2968 7.3499 7.2675

May . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1991 7.2166 7.2706 7.1798

June . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1636 7.1804 7.1975 7.1636

July (through 18 July) . . . . . . . . . . . . . . . . . . . 7.1776 7.1730 7.1832 7.1647

Note:

(1) Determined by averaging the rates on the last business day of each month during the relevant year except

for monthly average rates which are determined by averaging the daily rates during the respective

months.– 142 –TAXATION

The following summary of certain tax consequences of the purchase ownership and disposition

of the Bonds and Shares is based upon applicable laws regulations rulings and decisions as at

the date of this Offering Circular all of which are subject to change (possibly with retroactive

effect). This discussion does not purport to be a comprehensive description of all the tax

considerations that may be relevant to a decision to purchase own or dispose of the Bonds or

Shares and does not purport to deal with consequences applicable to all categories of investors

some of which may be subject to special rules. Persons considering the purchase of the Bonds

should consult their own tax advisors concerning the tax consequences of the purchase

ownership and disposition of the Bonds and Shares including such possible consequences under

the laws of their country of citizenship residence or domicile.PRC

The following summary of certain PRC tax consequences of the purchase ownership and

disposition of Bonds is based upon applicable laws rules and regulations in effect as of the date

of this Offering Circular all of which are subject to change (possibly with retroactive effect).This discussion does not purport to be a comprehensive description of all the tax considerations

that may be relevant to a decision to purchase own or dispose of the Bonds and does not

purport to deal with consequences applicable to all categories of investors some of which may

be subject to special rules. Persons considering the purchase of Bonds should consult their own

tax advisors concerning the tax consequences of the purchase ownership and disposition of

Bonds including such possible consequences under the laws of their country of citizenship

residence or domicile.Income Tax

The Issuer is a high-tech enterprise provided for by the state considered a PRC tax resident

enterprise for the purpose of the PRC EIT Law and is subject to enterprise income tax at a

rate of 15 per cent. on its income sourced from both within and outside the PRC. On that

basis Holders will be subject to withholding tax income tax and other taxes or duties

imposed by relevant government authorities in the PRC in respect of the holding of the

Bonds or any repayment of principal and premium (if any) and interest (if any) made

thereon as further described below.Pursuant to the PRC EIT Law and the PRC IIT Law as amended and their implementation

rules any non-PRC resident enterprise without an establishment within the PRC or whose

income has no actual connection to its establishment inside the PRC or any non-PRC

resident individual who is not residing in the PRC or who has resided in the PRC for less

than 183 days with a tax year must pay income tax on the PRC-sourced income unless a

preferential rate is provided by tax treaties or arrangements entered into between the

country or region where the non-resident is established or tax resided and the PRC and

such income tax must be withheld at source by the PRC payer. Accordingly the Issuer must

withhold income tax from the payments of redemption premium (if any) and interest (if

any) on the Bonds to any non-PRC resident enterprise Holder at the rate of 10% and any

non-PRC resident individual Holder at the rate of 20% unless there is an applicable tax

treaty or arrangement that reduces or exempts such income tax.– 143 –Under the PRC EIT Law and its implementation rules any gains realised on the transfer of

the Bonds by non-PRC resident enterprise Holders may be subject to PRC enterprise

income tax if such gains are regarded as PRC-sourced income. If the gains derived from the

disposal of the Bonds issued by a PRC enterprise and held by non-PRC resident enterprise

Holders are regarded as PRC-sourced income such gain will be subject to PRC enterprise

income tax. However it is not clear under the PRC laws whether the gains realised on the

transfer of the Bonds are PRC-sourced for PRC tax purposes. Therefore there is

uncertainty as to whether gains realised on the transfer of the Bonds by non-PRC individual

Holders will be subject to PRC individual income tax.In addition under the PRC IIT Law individuals who do not have a domicile in the PRC

and have not resided in the PRC or individuals who do not have a domicile in the PRC but

have resided in the PRC for less than 183 days cumulatively within a tax year shall be

deemed as non-resident individuals. Income derived by non-resident individuals from China

shall be subject to individual income tax pursuant to the provisions of the PRC IIT Law.There is uncertainty as to whether gains realised on the transfer of the Bonds by individual

holders who are not PRC citizens or residents will be subject to PRC individual income

taxarising within the territory of the PRC.Any PRC tax on interest (if any) redemption premium or transfers of Bonds will apply at a

rate of 10 per cent. in the case of non-PRC enterprises without an establishment within the

PRC or whose income has no actual connection to its establishment inside the PRC and at a

rate of 20 per cent. in the case of non-PRC individuals unless there is an applicable tax

treaty or arrangement that reduces or exempts such income tax.The conversion of the Bonds without converting due interests into shares by non-PRC

Holders is not subject to PRC income tax.Value-added Tax

On 23 March 2016 the Ministry of Finance and the SAT issued Circular on the

Comprehensively Launching of the Pilot Scheme for the Conversion of Business Tax into

Value-added Tax (關於全面推開營業稅改徵增值稅試點的通知) (“Circular 36”) which

confirms that business tax will be completely replaced by VAT from 1 May 2016. Since

then the income derived from the provision of financial services which attracted business

tax will be entirely replaced by and subject to VAT.According to Circular 36 the entities and individuals providing the services within the PRC

shall be subject to VAT. The services are treated as being provided within the PRC where

either the service provider or the service recipient is located in the PRC. The services subject

to VAT include the provision of financial services such as the provision of loans. It is

further clarified under Circular 36 that the “loans” refers to the activity of lending capital

for another’s use and receiving the interest income thereon. Based on the definition of

“loans” under Circular 36 the issuance of Bonds is likely to be treated as the holders of the

Bonds providing loans to the Issuer which thus shall be regarded as financial services

subject to VAT. Further given that the Issuer is located in the PRC the holders of the

Bonds would be regarded as providing the financial services within the PRC and

consequently the holders of the Bonds shall be subject to VAT at the rate of 6 per cent.for payments of interest (if any) and certain other amounts on the Bonds paid by the Issuer

to Bondholders that are non-resident enterprises or individuals.– 144 –However there is uncertainty as to whether gains derived from a sale or exchange of Bonds

consummated outside of the PRC between non-PRC resident Bondholders will be subject to

VAT. VAT is unlikely to be applicable to any transfer of Bonds between entities or

individuals located outside of the PRC and therefore unlikely to be applicable to gains

realised upon such transfers of Bonds but there is uncertainty as to the applicability of

VAT if either the seller or buyer of Bonds is located inside the PRC. Circular 36 together

with other laws and regulations pertaining to VAT are relatively new and the interpretation

and enforcement of such laws and regulations involve uncertainties.Stamp Duty

No PRC stamp duty will be chargeable upon the issue or transfer of the Bonds or H Shares

(if the register of the Holders is maintained outside the PRC and the issue or transfer of the

Bonds or H Shares are made outside of the PRC).HONG KONG

Withholding Tax

No withholding tax is payable in Hong Kong in respect of payments of principal or interest

(if any) on the Bonds or in respect of any capital gains arising from the sale of the Bonds.Profits Tax

Hong Kong profits tax is chargeable on every person carrying on a trade profession or

business in Hong Kong in respect of profits arising in or derived from Hong Kong from

such trade profession or business (excluding profits arising from the sale of capital assets).Interest on the Bonds if any may be deemed to be profits arising in or derived from Hong

Kong from a trade profession or business carried on in Hong Kong in the following

circumstances:

(a) interest on the Bonds is derived from Hong Kong and is received by or accrues to a

corporation carrying on a trade profession or business in Hong Kong;

(b) interest on the Bonds is derived from Hong Kong and is received by or accrues to a

person other than a corporation carrying on a trade profession or business in Hong

Kong and is in respect of the funds of that trade profession or business;

(c) interest on the Bonds is received by or accrues to a financial institution (as defined in

the Inland Revenue Ordinance (Cap. 112) of Hong Kong (the “IRO”)) and arises

through or from the carrying on by the financial institution of its business in Hong

Kong; or

(d) interest on the Bonds is received by or accrues to a corporation other than a financial

institution and arises through or from the carrying on in Hong Kong by the

corporation of its intra-group financing business (within the meaning of section 16(3)

of the IRO).– 145 –Sums received by or accrued to a financial institution by way of gains or profits arising

through or from the carrying on by the financial institution of its business in Hong Kong

from the sale disposal or redemption of Bonds will be subject to Hong Kong profits tax.Sums received by or accrued to a corporation other than a financial institution by way of

gains or profits arising through or from the carrying on in Hong Kong by the corporation

of its intra-group financing business (within the meaning of section 16(3) of the IRO) from

the sale disposal or other redemption of Bonds will be subject to Hong Kong profits tax.Sums derived from the sale disposal or redemption of Bonds will be subject to Hong Kong

profits tax where received by or accrued to a person other than a financial institution who

carries on a trade profession or business in Hong Kong and the sum has a Hong Kong

source unless otherwise exempted. The source of such sums will generally be determined by

having regard to the manner in which the Bonds are acquired and disposed of.In addition with effect from 1 January 2024 pursuant to various foreign-sourced income

exemption legislation in Hong Kong (the “FSIE Amendments”) certain specified

foreign-sourced income (including interest dividend disposal gain or intellectual

property income in each case arising in or derived from a territory outside Hong Kong)

accrued to an MNE entity (as defined in the FSIE Amendments) carrying on a trade

profession or business in Hong Kong is regarded as arising in or derived from Hong Kong

and subject to Hong Kong profits tax when it is received in Hong Kong. The FSIE

Amendments also provide for relief against double taxation in respect of certain foreign

sourced income and transitional matters.In certain circumstances Hong Kong profits tax exemptions (such as concessionary tax

rates) may be available. Investors are advised to consult their own tax advisors to ascertain

the applicability of any exemptions to their individual position.Stamp Duty

No Hong Kong stamp duty will be chargeable upon the issue or transfer or conversion of a

Bond.– 146 –SUBSCRIPTION AND SALE

The Issuer has entered into a subscription agreement with the Lead Managers dated 28 July

2025 (the “Subscription Agreement”) pursuant to which and subject to certain conditions

contained therein the Issuer has agreed to issue and the Lead Managers has agreed to

subscribe and pay for or to procure subscribers to subscribe and pay for the aggregate

principal amount of the Bonds set forth opposite its name below.Principal amount of

the Bonds to be

subscribed

(RMB)

CLSA Limited . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3405 million

China Securities (International) Corporate Finance Company Limited 179 million

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3584 million

The Issuer has agreed in the Subscription Agreement that neither the Issuer nor any person

acting on its behalf will (a) issue offer sell pledge encumber contract to sell or otherwise

dispose of or grant options issue warrants or offer rights entitling persons to subscribe or

purchase any interest in any Shares or securities of the same class as the Bonds or the Shares

or any securities convertible into exchangeable for or which carry rights to subscribe or

purchase the Bonds the Shares or securities of the same class as the Bonds the Shares or

other instruments representing interests in the Bonds the Shares or other securities of the

same class as them (b) enter into any swap or other agreement that transfers in whole or in

part any of the economic consequences of the ownership of the Shares (c) enter into any

transaction with the same economic effect as or which is designed to or which may

reasonably be expected to result in or agree to do any of the foregoing whether any such

transaction of the kind described in (a) (b) or (c) is to be settled by delivery of Shares or

other securities in cash or otherwise or (d) announce or otherwise make public an intention

to do any of the foregoing in any such case without the prior written consent of the Lead

Managers between the date hereof and the date which is 90 days after the Closing Date

except for the Bonds and the New Shares issued on conversion of the Bonds.The Subscription Agreement provides that the Issuer will indemnify the Lead Managers

against certain liabilities in connection with the offer and sale of the Bonds. The

Subscription Agreement provides that the obligations of the Lead Managers are subject to

certain conditions precedent and entitles the Lead Managers to terminate it in certain

circumstances prior to payment being made to the Issuer.The Lead Managers and their respective affiliates are full service financial institutions

engaged in various activities which may include securities trading commercial and

investment banking financial advisory investment management principal investment

hedging financing and brokerage activities (“Banking Services or Transactions”). The Lead

Managers and their respective affiliates may have from time to time performed and may

in the future perform various Banking Services or Transactions with the Issuer for which

they have received or will receive fees and expenses.In connection with the offering of the Bonds the Lead Managers and/or their respective

affiliates or affiliates of the Issuer may act as investors and place orders receive

allocations and trade the Bonds for its or their own account and such orders allocations or

trading of the Bonds may be material. Such entities may hold or sell such Bonds or purchase

– 147 –further Bonds for their own account in the secondary market or deal in any other securities

of the Issuer and therefore they may offer or sell the Bonds or other securities otherwise

than in connection with the offering of the Bonds. Accordingly references herein to offering

of the Bonds should be read as including any offering of the Bonds to the Lead Managers or

their respective affiliates or affiliates of the Issuer as investors for their own account. Such

entities are not expected to disclose such transactions or the extent of any such investment

otherwise than in accordance with any applicable legal or regulatory requirements. If such

transactions occur the trading price and liquidity of the Bonds and the Shares may be

impacted.Furthermore it is possible that a significant proportion of the Bonds may be initially

allocated to and subsequently held by a limited number of investors. If this is the case the

trading price and liquidity of trading in the Bonds may be constrained. The Issuer and the

Lead Managers are under no obligation to disclose the extent of the distribution of the

Bonds amongst individual investors otherwise than in accordance with any applicable legal

or regulatory requirements.In the ordinary course of their various business activities the Lead Managers and their

respective affiliates make or hold a broad array of investments and actively trade debt and

equity securities (or related derivative securities) and financial instruments (including bank

loans) for their own account and for the accounts of their customers and may at any time

hold long and short positions in such securities and instruments. Such investment and

securities activities may involve securities and instruments of the Issuer including the

Bonds and the Shares and could adversely affect the trading price and liquidity of the Bonds

and the Shares. The Lead Managers and their respective affiliates may make investment

recommendations and/or publish or express independent research views (positive or

negative) in respect of the Bonds the Shares or other financial instruments of the Issuer

and may recommend to their clients that they acquire long and/or short positions in the

Bonds the Shares or other financial instruments of the Issuer.Notice to capital market intermediaries and prospective investors pursuant to paragraph 21 of

the Hong Kong SFC Code of Conduct — Important Notice to CMIs (including private banks):

This notice to CMIs (including private banks) is a summary of certain obligations the SFC

Code imposes on CMIs which require the attention and cooperation of other CMIs

(including private banks). Certain CMIs may also be acting as OCs for this offering and are

subject to additional requirements under the SFC Code.Prospective investors who are the directors employees or major shareholders of the Issuer

a CMI or its group companies would be considered under the SFC Code as having an

Association with the Issuer the CMI or the relevant group company. CMIs should

specifically disclose whether their investor clients have any Association when submitting

orders for the Bonds. In addition private banks should take all reasonable steps to identify

whether their investor clients may have any Associations with the Issuer or any CMI

(including its group companies) and inform the Lead Managers accordingly.CMIs are informed that the marketing and investor targeting strategy for this offering

includes institutional investors sovereign wealth funds pension funds hedge funds family

offices and high net worth individuals in each case subject to the selling restrictions set out

elsewhere in this Offering Circular.– 148 –CMIs should ensure that orders placed are bona fide are not inflated and do not constitute

duplicated orders (i.e. two or more corresponding or identical orders placed via two or more

CMIs). CMIs should enquire with their investor clients regarding any orders which appear

unusual or irregular. CMIs should disclose the identities of all investors when submitting

orders for the Bonds (except for omnibus orders where underlying investor information

may need to be provided to any OCs when submitting orders). Failure to provide

underlying investor information for omnibus orders where required to do so may result in

that order being rejected. CMIs should not place “X-orders” into the order book.CMIs should segregate and clearly identify their own proprietary orders (and those of their

group companies including private banks as the case may be) in the order book and book

messages.CMIs (including private banks) should not offer any rebates to prospective investors or pass

on any rebates provided by the Issuer. In addition CMIs (including private banks) should

not enter into arrangements which may result in prospective investors paying different

prices for the Bonds.The SFC Code requires that a CMI disclose complete and accurate information in a timely

manner on the status of the order book and other relevant information it receives to

targeted investors for them to make an informed decision. In order to do this the Lead

Managers should consider disclosing order book updates to all CMIs.When placing an order for the Bonds private banks should disclose at the same time if

such order is placed other than on a “principal” basis (whereby it is deploying its own

balance sheet for onward selling to investors). Private banks who do not provide such

disclosure are hereby deemed to be placing their order on such a “principal” basis.Otherwise such order may be considered to be an omnibus order pursuant to the SFC

Code.In relation to omnibus orders when submitting such orders CMIs (including private

banks) that are subject to the SFC Code should disclose underlying investor information in

respect of each order constituting the relevant omnibus order (failure to provide such

information may result in that order being rejected). Underlying investor information in

relation to omnibus orders should consist of:. The name of each underlying investor;. A unique identification number for each investor;. Whether an underlying investor has any “Associations” (as used in the SFC Code);. Whether any underlying investor order is a “Proprietary Order” (as used in the SFC

Code);. Whether any underlying investor order is a duplicate order.Underlying investor information in relation to omnibus order should be sent to:

ib.equitylinked@clsa.com and syndicate@csci.hk.– 149 –To the extent information being disclosed by CMIs and investors is personal and/or

confidential in nature CMIs (including private banks) agree and warrant: (A) to take

appropriate steps to safeguard the transmission of such information to any OCs; and (B)

that they have obtained the necessary consents from the underlying investors to disclose

such information to any OCs. By submitting an order and providing such information to

any OCs each CMI (including private banks) further warrants that it and the underlying

investors have understood and consented to the collection disclosure use and transfer of

such information by any OCs and/or any other third parties as may be required by the SFC

Code including to the Issuer relevant regulators and/or any other third parties as may be

required by the SFC Code for the purpose of complying with the SFC Code during the

bookbuilding process for this offering. CMIs that receive such underlying investor

information are reminded that such information should be used only for submitting

orders in this offering. The Lead Managers may be asked to demonstrate compliance with

their obligations under the SFC Code and may request other CMIs (including private

banks) to provide evidence showing compliance with the obligations above (in particular

that the necessary consents have been obtained). In such event other CMIs (including

private banks) are required to provide the Lead Managers with such evidence within the

timeline requested.SELLING RESTRICTIONS

General

The distribution of this Offering Circular or any offering material and the offering sale or

delivery of the Bonds is restricted by law in certain jurisdictions. Therefore persons who

may come into possession of this Offering Circular or any offering material are advised to

consult with their own legal advisers as to what restrictions may be applicable to them and

to observe such restrictions. This Offering Circular may not be used for the purpose of an

offer or invitation in any circumstances in which such offer or invitation is not authorised.No action has been taken or will be taken in any jurisdiction that would permit a public

offering of the Bonds or possession or distribution of this Offering Circular or any

amendment or supplement thereto or any other offering or publicity material relating to the

Bonds in any country or jurisdiction where action for that purpose is required.Accordingly the Bonds may not be offered or sold directly or indirectly and neither

this Offering Circular nor any other offering material or advertisements in connection with

the Bonds may be distributed or published by the Issuer or the Lead Managers in or from

any country or jurisdiction except in circumstances which will result in compliance with all

applicable rules and regulations of any such country or jurisdiction and will not impose any

obligations on the Issuer or the Lead Managers.If a jurisdiction requires that the offering be made by a licensed broker or dealer and the

Lead Managers or any affiliate of the Lead Managers is a licensed broker or dealer in that

jurisdiction the offering shall be deemed to be made by the Lead Managers or such affiliate

on behalf of the Issuer in such jurisdiction.United States

The Bond and the Shares to be issued upon conversion of the Bonds have not been and will

not be registered under the Securities Act and subject to certain exceptions may not be

offered or sold within the United States.– 150 –The Bonds are being offered and sold outside of the United States in reliance on Regulation

S.In addition until 40 days after the commencement of the offering of the Bonds an offer or

sale of the Bonds or Shares to be issued upon conversion of the Bonds within the United

States by any dealer (whether or not participating in the offering) may violate the

registration requirements of the Securities Act.United Kingdom

Each Lead Manager has represented warranted and agreed that:

(i) it has only communicated or caused to be communicated and will only communicate or

cause to be communicated an invitation or inducement to engage in investment activity

within the meaning of section 21 of the Financial Services and Markets Act 2000 (the

“FSMA”) received by it in connection with the issue or sale of the Bonds in

circumstances in which section 21(1) of the FSMA does not apply to the Issuer; and

(ii) it has complied and will comply with all applicable provisions of the FSMA with

respect to anything done by it in relation to the Bonds in from or otherwise involving

the United Kingdom.Prohibition of Sales to EEA Retail Investors

Each Lead Manager has represented and agreed that it has not offered sold or otherwise

made available and will not offer sell or otherwise make available any Bonds which are the

subject of the offering contemplated by this Offering Circular in relation thereto to any

retail investor in the EEA. For the purposes of this provision:

(a) the expression “retail investor” means a person who is one (or more) of the following:

(i) a retail client as defined in point (11) of Article 4(1) of MiFID II; or

(ii) a customer within the meaning of IMD where that customer would not qualify as

a professional client as defined in point (10) of Article 4(1) of MiFID II.Prohibition of Sales to UK Retail Investors

Each Lead Manager has represented and agreed that it has not offered sold or otherwise

made available and will not offer sell or otherwise make available any Bonds which are the

subject of the offering contemplated by this Offering Circular in relation thereto to any

retail investor in the United Kingdom. For the purposes of this provision:

(a) the expression “retail investor” means a person who is one (or more) of the following:

(i) a retail client as defined in point (8) of Article 2 of Regulation (EU) No 2017/565

as it forms part of domestic law by virtue of the EUWA; or

– 151 –(ii) a customer within the meaning of the provisions of the FSMA and any rules or

regulations made under the FSMA to implement Directive (EU) 2016/97 where

that customer would not qualify as a professional client as defined in point (8) of

Article 2(1) of Regulation (EU) No 600/2014 as it forms part of domestic law by

virtue of the EUWA.Hong Kong

Each Lead Manager has represented and agreed that:

(i) it has not offered or sold and will not offer or sell in Hong Kong by means of any

document any Bonds other than (a) to “professional investors” as defined in the

Securities and Futures Ordinance (Cap. 571) of Hong Kong (the “SFO”) and any rules

made under the SFO; or (b) in other circumstances which do not result in the document

being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous

Provisions) Ordinance (Cap. 32) of Hong Kong (the “C(WUMP)O”) or which do not

constitute an offer to the public within the meaning of the C(WUMP)O; and

(ii) it has not issued or had in its possession for the purposes of issue and will not issue or

have in its possession for the purposes of issue whether in Hong Kong or elsewhere

any advertisement invitation or document relating to the Bonds which is directed at

or the contents of which are likely to be accessed or read by the public of Hong Kong

(except if permitted to do so under the securities laws of Hong Kong) other than with

respect to Bonds which are or are intended to be disposed of only to persons outside

Hong Kong or only to “professional investors” as defined in the SFO and any rules

made under the SFO.Singapore

Each Lead Manager has acknowledged that this Offering Circular has not been registered as

a prospectus with the Monetary Authority of Singapore. Accordingly each Lead Manager

has represented warranted and agreed that it has not offered or sold any Bonds or caused

the Bonds to be made the subject of an invitation for subscription or purchase and will not

offer or sell the Bonds or cause the Bonds to be made the subject of an invitation for

subscription or purchase and has not circulated or distributed nor will it circulate or

distribute this Offering Circular or any other document or material in connection with the

offer or sale or invitation for subscription or purchase of the Bonds whether directly or

indirectly to any person in Singapore other than (i) to an institutional investor (as defined

in Section 4A of the Securities and Futures Act 2001 of Singapore as modified or amended

from time to time (the “SFA”) pursuant to Section 274 of the SFA or (ii) to an accredited

investor (as defined in Section 4A of the SFA) pursuant to and in accordance with the

conditions specified in Section 275 of the SFA.Japan

The Bonds have not been and will not be registered under the Financial Instruments andExchange Act of Japan (Act No. 25 of 1948 as amended) (the “Financial Instruments andExchange Act”). Accordingly each Lead Manager has represented warranted and agreed

that it has not directly or indirectly offered or sold and will not directly or indirectly offer

or sell any Bonds in Japan or to or for the benefit of any resident of Japan (which term as

used herein means any person resident in Japan including any corporation or other entity

– 152 –organised under the laws of Japan) or to others for re-offering or re-sale directly or

indirectly in Japan or to or for the benefit of any resident of Japan except pursuant to an

exemption from the registration requirements of and otherwise in compliance with the

Financial Instruments and Exchange Act and other relevant laws and regulations of Japan.PRC

Each Lead Manager represents warrants and agrees that the Bonds are not being offered or

sold and may not be offered or sold directly or indirectly in the PRC (for such purposes

not including Hong Kong and the Macau Special Administrative Region of the PRC and

Taiwan) except as permitted by the applicable laws and regulations in the PRC.– 153 –DESCRIPTION OF CERTAIN DIFFERENCES BETWEEN PRC GAAP AND IFRS

The audited consolidated financial statements of the Issuer have been prepared and presented

in accordance with PRC GAAP. PRC GAAP are substantially in line with IFRS except for

certain modifications that still exist between PRC GAAP and IFRS which might be relevant

to the financial information of the Group included herein.The following is a general summary of certain differences between PRC GAAP and IFRS as

applicable to the Group. The differences identified below are limited to those significant

differences that are appropriate to the Group’s financial statements. Since the summary is not

meant to be exhaustive there can be no assurance regarding the completeness of the summary.The Group has not prepared a complete reconciliation of the consolidated financial

information and related footnote disclosure between PRC GAAP and IFRS and has not

quantified such differences. Had any such quantification or reconciliation been undertaken by

the Group other potentially significant accounting and disclosure differences may be required

that are not identified below. Additionally no attempt has been made to identify possible

future differences between PRC GAAP and IFRS as a result of prescribed changes in

accounting standard. Regulatory bodies that promulgate PRC GAAP and IFRS have

significant projects ongoing that could affect future comparisons such as this one. Finally

no attempt has been made to identify future differences between PRC GAAP and IFRS that

may affect the financial information as a result of transactions or events that may occur in the

future. Accordingly no assurance is provided that the following summary of differences

between PRC GAAP and IFRS is complete.In making an investment decision investors must rely upon their own examination of the

Group the terms of the offering and other disclosure contained herein. Investors should consult

their own professional advisors for an understanding of the differences between PRC GAAP

and IFRS and/or between PRC GAAP and other generally accepted accounting principles and

how those differences might affect the financial information contained herein.GOVERNMENT GRANT

Under PRC GAAP an assets-related government grant is only required to be recognised as

deferred income and evenly amortised to profit or loss over the useful life of the related

asset. However under IFRS such assets-related government grants are allowed to be

presented in the statement of financial position either by setting up the grant as deferred

income or by deducting the grant in arriving at the carrying amount of the asset.Under PRC GAAP the relocation compensation for public interests is required to be

recognised as special payables. The income from compensation attributable to losses of

fixed assets and intangible assets related expenses losses from production suspension

incurred during the relocation and reconstruction period and purchases of assets after the

relocation shall be transferred from special payables to deferred income and accounted for

in accordance with the government grants standard. The surplus reached after deducting the

amount transferred to deferred income shall be recognised in capital reserve.Under IFRS if an entity relocates for reasons of public interests the compensation received

shall be recognised in profit and loss.– 154 –REVERSAL OF AN IMPAIRMENT LOSS

Under PRC GAAP once an impairment loss is recognised for a long term asset (including

fixed assets intangible assets and goodwill etc.) it shall not be reversed in any subsequent

period.Under IFRS an impairment loss recognised in prior periods for an asset other than

goodwill could be reversed if there has been a change in the estimates used to determine the

asset’s recoverable amount since the last impairment loss was recognised.RELATED PARTY DISCLOSURES

Under PRC GAAP government-related entities are not treated as related parties.Under IFRS government-related entities are still treated as related parties.FIXED ASSETS AND INTANGIBLE ASSETS

Under PRC GAAP only the cost model is allowed.Under IFRS an entity can choose either the cost model or the revaluation model as its

accounting policy.– 155 –GENERAL INFORMATION

1. Clearing System: The Bonds have been accepted for clearance through Euroclear and

Clearstream under Common Code number 314015843 and the International Securities

Identification Number for the Bonds is XS3140158430. The Legal Entity Identifier

(LEI) of the Issuer is 3003004FBGVVG1CW5U45.

2. Listing of Bonds: Application will be made to the Hong Kong Stock Exchange for the

listing of and permission to deal in the Bonds by way of debt issues to Professional

Investors only. It is expected that listing of and permission to deal in the Bonds on the

Hong Kong Stock Exchange will commence on 6 August 2025.

3. Listing of the Shares: Application will be made to the Hong Kong Stock Exchange for

the listing of the H Shares issuable upon conversion of the Bonds on the Hong Kong

Stock Exchange. It is expected that dealing in and listing of such H Shares on the

Hong Kong Stock Exchange will commence when they are issued.

4. Authorisations: The Issuer has obtained all necessary consents approvals and

authorisations in connection with the issue and performance of the Bonds. The issue

of the Bonds was approved by the resolutions of the board of directors of the Issuer on

27 July 2025. The Shares to be issued upon conversion of the Bonds are to be issued

pursuant to the general mandate to the Directors of the Issuer at its annual general

meeting held on 28 March 2025.

5. No Material Adverse Change: Save as disclosed in this Offering Circular there has been

no material adverse change since 31 December 2024 in the financial or trading

position prospects or results of operations of the Group.

6. Litigation: From time to time the members of the Group may be involved in litigation

or other disputes that arise in the ordinary course of business. However none of any

member of the Group is currently involved in any litigation disputes or arbitration

proceedings which are material in the context of the issue of the Bonds. The Issuer is

not aware of any such litigation disputes or arbitration proceedings that are currently

pending or threatened.

7. Consolidated Financial Statements: The consolidated financial statements of the Issuer

for the years ended 31 December 2023 and 2024 are incorporated by reference in this

Offering Circular and have been audited by Ernst & Young Hua Ming LLP as stated

in their reports appearing therein.– 156 –8. Available Documents: Copies of the latest annual reports and interim reports of the

Issuer may be downloaded free of charge from the website of the Hong Kong Stock

Exchange (http://www.hkex.com.hk) and copies of the Articles of Association the

Trust Deed and the Agency Agreement will be made available for inspection from the

Issue Date upon prior written request and proof of holding at the Issuer’s principal

office in Hong Kong at 31/F Tower Two Times Square 1 Matheson Street Causeway

Bay Hong Kong during normal business hours. Copies of the Trust Deed and of the

Agency Agreement (i) are available for inspection at all reasonable times during usual

business hours (being between 9.00 a.m. (Hong Kong time) and 3.00 p.m. (Hong Kong

time) Monday to Friday except for public holidays) at the principal office of the

Principal Agent being at the date of the Trust Deed at 3/F CCB Tower 3 Connaught

Road Central Central Hong Kong and (ii) may be provided by email to any

Bondholder in each case following prior written request and proof of holding and

identity satisfactory to the Principal Agent so long as any of the Bonds is outstanding.– 157 –REGISTERED AND PRINCIPAL OFFICE OF THE ISSUER

Registered Office Principal Place of Business in Hong Kong

ZTE Plaza Keji Road South 31/F Tower Two Times Square

Hi-Tech Industrial Park 1 Matheson Street Causeway Bay

Nanshan District Shenzhen Guangdong Province Hong Kong

PRC

TRUSTEE PRINCIPAL PAYING AGENT

CONVERSION AGENT REGISTRAR AND

TRANSFER AGENT

China Construction Bank (Asia) China Construction Bank (Asia)

Corporation Limited Corporation Limited

(中國建設銀行（亞洲）股份有限公司)(中國建設銀行（亞洲）股份有限公司)

28/F CCB Tower 28/F CCB Tower

3 Connaught Road Central 3 Connaught Road Central

Central Hong Kong Central Hong Kong

LEGAL ADVISORS TO THE ISSUER

as to Hong Kong law as to English law as to PRC law

Paul Hastings (Hong Kong) LLP Paul Hastings (Europe) LLP JunHe LLP

22/F Bank of China Tower 100 Bishopgate 20/F China Resources Building

1 Garden Road London EC2N 4AG 8 Jianguomen North Street

Central Hong Kong United Kingdom Beijing PRC

LEGAL ADVISORS TO THE LEAD MANAGERS

as to English law and Hong Kong law as to PRC law

Linklaters Jingtian & Gongcheng LLP

11th Floor Alexandra House 34/F Tower 3 China Central Place

18 Chater Road 77 Jianguo Road

Central Hong Kong Chaoyang District Beijing PRC

LEGAL ADVISORS TO THE TRUSTEE

as to English law

Linklaters

11th Floor Alexandra House

18 Chater Road

Central Hong Kong

INDEPENDENT AUDITORS

Ernst & Young Hua Ming LLP

Level 47 Ernst & Young Tower Oriental Plaza

No.1 East Chang An Avenue

Dongcheng District Beijing PRC