Lenovo 2010 Annual Report Download - page 128

2009/10 Annual Report Lenovo Group Limited
126
NOTES TO THE FINANCIAL STATEMENTS (continued)
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28 Non-current liabilities
(a) The interest-bearing bank loans of US$200 million classified as non-current liabilities represents a US$300 million
3-year term loan facility with a bank in China obtained in March 2009. This facility was utilized to the extent of
US$200 million at March 31, 2010 (2009: US$200 million).
The carrying amounts of non-current financial liabilities approximate their fair value as the impact of discounting is
not significant.
The exposure of the interest-bearing bank loans to interest rate changes and the contractual repricing dates at the
end of the reporting period are as follows:
Group and Company
2010 2009
US$’000 US$’000
Repayable on demand 230,000 400,000
Over 3 months to 1 year – 35,000
Over 1 year 200,000 230,000
430,000 665,000
(b) On May 17, 2005, the Company issued 2,730,000 convertible preferred shares at the stated value of HK$1,000 per
share and unlisted warrants to subscribe for 237,417,474 ordinary shares of the Company for an aggregate cash
consideration of approximately US$350 million. The convertible preferred shares bear a fixed cumulative preferential
cash dividend, payable quarterly, at the rate of 4.5 percent per annum on the stated value of each convertible
preferred share. The convertible preferred shares are redeemable, in whole or in part, at a price equal to the
issue price together with accrued and unpaid dividends at the option of the Company or the convertible preferred
shareholders at any time after the maturity date at May 17, 2012. The warrant holders are entitled to subscribe for
237,417,474 shares in the Company at HK$2.725 per share.
On September 9, 2009 and February 11, 2010, 621,250 and 384,582 convertible preferred shares were converted
into 227,981,647 and 141,131,005 voting ordinary shares respectively. At March 31, 2010, the outstanding number
of convertible preferred shares was 769,167.
On September 9, 2009, 63,502,788 warrants were exercised pursuant to which the remaining 173,914,686 warrants
were repurchased by the Company at a unit price of HK$0.995 on the same day.
Movements of the liability component of the convertible preferred shares during the year are as follows:
Group and Company
2010 2009
US$’000 US$’000
At April 1 215,974 211,181
Exchange adjustment (280) 918
Interest charged 10,915 14,115
Interest paid (7,925) (10,240)
Conversion to voting ordinary shares (123,704) –
At March 31 94,980 215,974