Stock Codes: 600801, 900933 Stock abbreviations: Huaxin Cement, Huaxin B Share Ref: Lin 2010-003
Huaxin Cement Co., Ltd.
Announcement on Resolutions of the Eleventh Meeting of the Sixth Board of Directors
and Convening the Annual Shareholders’ General Meeting 2009
The Board of Directors of the Company and its members guarantee that there is no false or misleading statement or material omission in this announcement and shall be severally and jointly liable for the truthfulness, accuracy and completeness of its contents.
The Eleventh Meeting of the Sixth Board of Directors of Huaxin Cement Co., Ltd. (hereinafter referred to as “the Company”) was convened on March 29, 2010 in Wuhan City, Hubei Province. In principle, there should be nine directors attend the Meeting, actually nine attended. The Company has sent the Meeting Notification to all the directors on March 19, 2010, by personal service or by fax. The Meeting was in compliance with the provisions contained in relevant laws, rules, regulations and the Articles of Association of the Company, so it was legitimate and valid.
I. Through reviewing and voting, this Board Meeting adopted the following important resolutions:
(I) Annual Report 2009 of the Company and its abstract
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
(II) Directors’ Report 2009 of the Company
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
For detailed information, please refer to Chapter 8 of the Annual Report disclosed on the same day.
(III) Final Financial Report 2009
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
For detailed information, Please refer to Chapter 11 of the Annual Report disclosed on the same day.
(IV) Profit Distribution Proposal of the Company 2009
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0).
The net profit of the Company for 2009 was 441,411,984 yuan (parent company) or 500,507,612 yuan after consolidation. Pursuant to the relevant provisions contained in the new Company Law and the new Accounting Rule, 10%, i.e. 44,141,198 yuan will be appropriated to statutory surplus common reserve fund. The allocable profit of the parent company is 754,563,996 yuan by the end of December 2009.
The Board proposes that on the basis of the total 403.6 million shares, a cash dividend of 0.2 yuan per share (incl. tax) shall be distributed to all shareholders, hence 80,720,000 yuan shall be distributed, and the whole of the remaining shall be booked as unallocated profit.
The Board also proposes that no capital reserve shall be converted into share capital for 2009.
.
(V) Proposal in Respect of Reappointing the Accounting Firm and Empowering the Board of Directors to Decide its Remuneration
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
As recommended by the Management of the Company, the Audit Committee of the Board of Directors proposes that PricewaterhouseCoopers Zhong Tian CPAs Limited Company be appointed as both domestic and international auditor of the Company for 2010 and that the Shareholders' General Meeting be requested to empower the Board to decide the payment to it.
(VI) Annual Work Report 2009 of Independent Directors
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
(VII) Proposal in Respect of Placement of Mid-term Notes and Renewal of Short-term Financing Bonds
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
For detailed information, please refer to Annex I.
(VIII) Proposal in Respect of Providing Guarantees for Project Loans and Comprehensive Credit Business of Subsidiaries
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
For detailed information, please refer to Annex II.
(IX) Proposal in Respect of Accepting Mr. Tom Clough to Resign from the Position of Director
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
(X) Proposal in Respect of Nominating Mr. Ian Thackwray as the Director of the Sixth Board of Directors
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
Mr. Tom Clough has expressed to the Chairman of the Board his request to resign from the position of Director of the Company; at the same time, shareholder Holchin B.V. recommends Mr. Ian Thackwray to be a new director of the Company.
After studying, the Nominating Committee of the Board of Directors proposes that Mr. Ian Thackwray become a new Director of the Company, and the term of office shall be the same with current Board of Director.
Encl: Résumé of Mr. Ian Thackwray
Ian Thackwray, 52 years old, British. Ian Thackwray holds an MA (Hons) in Chemistry from Oxford University and is also a chartered accountant. After his studies, he joined Price Waterhouse and handled major corporate accounts in Europe. In 1985, he started a career with Dow Corning Corporation, serving in various management roles in Europe, North America and particularly in Asia. From 2004 to 2006, he served as Dow Corning's Asian/Pacific President based out of Shanghai. Since September 2006, he has been CEO of Holcim Philippines. In 2009, the Board of Directors of Holcim Ltd has appointed him a member of the Executive Committee. He has joined the Executive Committee at the beginning of 2010.
(XI) Report on Utilization of the Funds Raised from Previous Offering
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
For detailed information, please refer to Annex III.
(XII) Proposal in Respect of Convening the Annual Shareholders’ General Meeting 2009
(Voting Result: Affirmative 9; Negative: 0; Abstention: 0);
II. Notice regarding Convening the Annual Shareholders’ General Meeting 2009
1. Time of the Meeting: 9:00 am, April 22, 2010 (Wednesday)
2. Share registration date
(1) A-share Registration Date: April 12, 2010
(2) B-share Registration Date: April 16, 2010 (Last trading date is April 12)
3. Place of the Meeting: Meeting Room No.1 on the first floor of the Business Centre of the Company in Wuhan, Building No.5, International Enterprise Centre, Special No.1 Guanshan Road 2, Wuhan City, Hubei, China
4. Convenor of the Meeting: Board of Directors of the Company
5. Manner of Voting: on-site voting
6. Proposals of the Meeting:
(1) To review the Directors’ Report 2009 of the Company;
(2) To review the Supervisors’ Report 2009 of the Company;
(3) To review the Final Financial Report 2009 and the Financial Budget 2010;
(4) To review the Profit Distribution Proposal 2009 of the Company;
(5) To review the Proposal in Respect of Reappointing the Accounting Firm and Empowering the Board of Directors to Decide Its Remuneration;
(6) To review the Annual Work Report 2009 of Independent Directors;
(7) To review the Proposal in Respect of Applying for Placement of Mid-term Notes and Renewal of Short-term Financing Bonds;
(8) To review the Proposal in Respect of Providing Guarantees for Project Loans and Comprehensive Credit Business of Subsidiaries;
(9) To review the Proposal in Respect of Accepting Mr. Tom Clough to Resign from the Position of Director;
(10) To review the Proposal in Respect of Nominating Mr. Ian Thackwray as the Director of the Sixth Board of Directors;
(11) To review the Proposal on Adjusting Allowances for Directors and Supervisors of the Company;
(For detailed information, please refer to the Announcement on Resolutions of the Huaxin Cement Co., Ltd. Tenth Meeting of the Sixth Board of Directors disclosed on March 25.)
(12) To review the Report on Utilization of the Funds Raised from Previous Offering;
For detailed information of the above proposals, please refer to the website of SSE -- www.sse.com.cn one week before the Annual Shareholders’ General Meeting.
7. Attendees of the Meeting
(1) Directors, Supervisors and Senior Management of the Company.
(2) Lawyers engaged by the Company.
(3) All A-shareholders registered with China Securities Registration & Clearing Co. Ltd SH Branch at 3 o’clock of April 12, 2010 and all B-shareholders registered with China Securities Registration & Clearing Co. Ltd SH Branch at 3 o’clock of April 16, 2010 (April 12 being the last trading day of B-shares). Presence by proxy is allowed in case presence in person is impossible, subject to the presentation of a Power of Attorney. For the format of the Power of Attorney, please refer to Annex IV.
All shareholders have the right to attend this meeting.
8. Registration of the Meeting
(1) Registration Period: 09:00-11:30 am, 14:00-17:00 pm, April 21, 2010;
08:00-9:00 am, April 22, 2010.
(2) Registration Place: First floor of the Business Centre of the Company in Wuhan, Building No.5, International Enterprise Centre, Special No.1, Guanshan Road 2, Wuhan, Hubei, China.
(3) Registration Method: The legal representative of a corporate shareholder shall present his ID, valid document evidencing his capacity as legal representative; the proxy of a corporate shareholder shall present his ID, PoA issued by the legal representative and chopped by the company and shareholding certificate.
Individual shareholders shall present their ID cards or other valid documents evidencing their identity, their share account cards; the proxies of individual shareholders shall present their ID cards and PoAs.
The shareholders may as well register by mail or fax.
9. Others
(1) The Meeting is expected to last for a half day. The shareholders present at the Meeting shall pay the accommodation and travelling costs by themselves.
(2) Contacts: Ms. Wang Lu, Mr. Peng Puxin
Tel: 027-87773898
Fax: 027-87773962
Postal Code: 430073
It is herewith announced.
Huaxin Cement Co., Ltd.
Board of Directors
March 31, 2009
Annex I
Proposal in Respect of Applying for Placement of Mid-term Notes
and Renewal of Short-term Financing Bonds
On Jul 7th, 2009, the Company successfully issued 600 million yuan short-term financing bonds, which reduced financial expenses of 12 million yuan compared with bank loans over the same period of the last year, explored new financing channels and reduce the capital cost of the Company.
Owing to the uncertain of equity financing time, to explore new financing channels, relieve the comparatively uptight capital situation, optimize liability structure and reduce financial costs, the Company, conforming to the regulations of Management Method of Debt Financing Instrument for Non-financing Enterprise in Inter-bank Bond Markets, is to apply for placement of mid-term notes and renewal of short-term financing bonds.
1. The Company plans to issue mid-term notes amounting to 1,200 million yuan. It is mainly used for optimizing the liability structure and filling capital gaps. The way of issue will be a stand-by underwriting. It is estimated that the register in Association of Inter-bank Market Dealers will be completed within 100 days as the date of the signing of the Underwriting Agreement. The 3-year mid-term notes amounting to 600 million yuan will be firstly issued within two months after the registration complete. According to the capital needs of the Company, the 5-year mid-term notes amounting to 600 million yuan will be secondly issued within two years after the registration complete. Total cost of issuing mid-term notes is estimated to be 0.8-1.8 percentage points lower than the lending rate at the same period.
2. The Company plans to apply for a renewal of 365 day short-term financial bonds, amounting to 600 million yuan. It will be used for supplementing the liquidity. The way of renewal will be a stand-by underwriting by a main underwriting agent. The procedures of the renewal of short-term financing bonds issue are estimated to be completed at the end of Jul 2010. Total cost of the renewal of short-term financing bonds is estimated to be 1.4 percentage points lower than the lending rate at the same period.
The total amount of short-term financing bonds, Mid-term Notes and bank loans will be within the limit of the Year Budget.
Annex II
Proposal in Respect of Providing Guarantees for
Project Loans and Comprehensive Credit Business of Subsidiaries
Influenced by the national macroeconomic policies, financing institutions are now very strict on controlling the size of credit funds and approving credit funds for restricted industries. In order to meet with the requirements of new situation, effectively complement the capital requirements of subsidiaries, implement project loans, and reasonably burden the financial expenses, the Company is planning to provide guarantees for project loans and other comprehensive credit business of subsidiaries.
1. The senior management of the Company submits to the Board of Directors approve providing loan guarantees for the project No. 1) - 4), the total amount is RMB 772.40 million, and the guarantee period is the same as construction period. After completion, the land of the project and fixed assets will act as collateral, and guarantee liability of the company will be lifted after the mortgage procedures, while the balance guarantee will be provided by the company.
Details of guarantee are listed as follow:
1) The total investment of the 2000 t/d clinker-cement production line of Huaxin Cement (Diqing) Co., Ltd. is 290 million yuan, where 173 million yuan fixed assets loan will be applied for. In view of Huaxin Cement (Diqing) Co., Ltd. is a controlled subsidiary of Huaxin Cement Co., Ltd, the bank requires the Company to provide full guarantee for the project loan, amounting to 173 million yuan.
2) The total investment of the 4500 t/d clinker-cement production line of Huaxin Cement (Lengshuijiang) Co., Ltd. is 650 million yuan, where 420 million yuan fixed assets loan will be applied for. In view of Huaxin Cement (Lengshuijiang) Co., Ltd. is a 90% owned subsidiary of Huaxin Cement Co., Ltd, the bank requires the Company to provide full guarantee for the project loan, amounting to 420 million yuan.
3) The total investment of the 1200 kt/y iron & steel slag comprehensive utilization project of Huaxin Xianggang Cement Co., Ltd. is 165.08 million yuan, where 104 million yuan fixed assets loan will be applied for. As Huaxin Xianggang Cement Co., Ltd. is a 60% owned subsidiary of Huaxin Cement Co., Ltd, the bank requires the Company to provide 60% guarantee for the project loan, amounting to 62.4 million yuan.
4) The total investment of the 2000 t/d new dry process clinker-cement production line of Huaxin Cement Hongta (Jinghong) Co., Ltd. is 350 million yuan, where 227.50 million yuan fixed assets loan will be applied for. As Huaxin Cement Hongta (Jinghong) Co., Ltd. is a 51% owned subsidiary of Huaxin Cement Co., Ltd, the bank requires the Company to provide 51% guarantee for the project loan, amounting to 117 million yuan.
2. The senior management of the Company submits to the Board of Directors approve providing guarantees for comprehensive credit business (liquidity loans, notes financing, and financial leasing business) of part of subsidiaries; once expired, they still need the Company providing guarantee continually, amounting to 111.80 million (Valid guarantees amounting to 414.10 million yuan which have already been approved by the Board Meeting and Shareholders’ General Meeting included). The guarantee period is from April 1st, 2010 to April 1st, 2012. Details of guarantee are listed in the table as follow:
