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2011/12 Annual Report Lenovo Group Limited
102
DIRECTORS’ REPORT
Continuing Connected Transactions (continued)
NEC Newco Brand Licence Agreement
Date: The Closing Date
Parties: NEC and NECPC (a member of the JVCo Group on and following the Closing Date)
Services provided/received: NEC agreed to grant NECPC a licence to use certain rights in connection with the letters
andthemark“NEC”atroyaltypayabletoNECbyNECPC.
Term: Commence on the Closing Date for a period of 5 years.
Annual cap: 1/7/2011 – 31/3/2012 : JPY512 million (US$6,195,200)
1/4/2012 – 31/3/2013 : JPY682 million (US$8,252,200)
1/4/2013 – 31/3/2014 : JPY682 million (US$8,252,200)
1/4/2014 – 31/3/2015 : JPY682 million (US$8,252,200)
1/4/2015 – 31/3/2016 : JPY682 million (US$8,252,200)
1/4/2016 – 1/7/2016 : JPY170 million (US$2,057,000)
In accordance with Rule 14A.37 of the Listing Rules, the independent non-executive directors of the Company reviewed the
continuing connected transactions in the paragraph above and confirmed that the transactions were entered into:
(i) In the ordinary and usual course of business of the Group;
(ii) Either on normal commercial terms or on terms no less favorable to the Group than terms available to or from (as appropriate)
independent third parties; and
(iii) In accordance with the relevant agreement governing them on terms that were fair and reasonable and in the interests of the
shareholders of the Group as a whole.
Pursuant to Rule 14A.38 of the Listing Rules, the Company’s auditor was engaged to report on the Group’s continuing connected
transactionsinaccordancewithHongKongStandardonAssuranceEngagements3000“AssuranceEngagementsOtherThan
AuditsorReviewsofHistoricalFinancialInformation”andwithreferencetoPracticeNote740“Auditor’sLetteronContinuing
ConnectedTransactionsundertheHongKongListingRules”IssuedbytheHongKongInstituteofCertifiedPublicAccountants.
The auditor has issued an unqualified letter containing findings and conclusions in respect of the continuing connected transactions
disclosed by the Group in the paragraph above in accordance with paragraph 14A.38 of the Listing Rules. A copy of the auditor’s
letter has been provided by the Company to the Stock Exchange.
Auditor
The financial statements have been audited by PricewaterhouseCoopers who retire and, being eligible, offer themselves for re-
appointment.
Public Float
Based on the information that is publicly available to the Company and within the knowledge of the directors of the Company, as
at the date of this report, there is sufficient public float of more than 25 percent of the Company’s issued shares as required under
the Listing Rules.
On behalf of the Board
Yang Yuanqing
Chairman and Chief Executive Officer
Hong Kong, May 23, 2012