Article 154
Company bonds referred to herein means a form of security which is issued by a company in accordance with legally prescribed procedure, and which provides that the principal thereof and interest thereon shall be paid at specified times. The issue of company bonds shall meet the requirements set forth by the Securities Law of the People’s Republic of China.
Article 155
Upon approval of an application for company bonds issue granted by the relevant department authorized by the State Council, the plan for company bonds offer shall be made public. The plan for company bonds offer shall set forth the following major items:
(1) the name of the company;
(2) the purpose of the fund raised;
(3) the total value of the bonds and the par value of each bond;
(4) the determination method of the rate of interest on the bonds;
(5) the time limit and method for payment of the principal of and interest on the bonds;
(6) the security information concerning the bonds;
(7) the price, the commencing and ending date of the bonds issue;
(8) the net assets value of the company;
(9) the total value of issued and outstanding company bonds;
(10) the underwriter of the company bonds.
Article 156
Where material company bonds are issued, a company must state on each bond certificate the name of the company, the par value of the bond, interest rate, and repayment period, and the bond certificate shall be signed by the legal representative, and the company's chop shall be impressed thereon.
Article 157
Company bonds may be classified as either registered bonds or bearer bonds.
Article 158
If a company has issued bonds, it shall maintain a record of bondholders.
If registered bonds are issued, the following shall be recorded on the company's record of bondholders:
(1) the name and domicile of each bondholder;
(2) the dates on which the bondholders acquired the bonds and the serial numbers of the bond certificates;
(3) the total value of the bonds, the par value of each bond, the interest thereon, the term thereof and method for payment of principal and interest;
(4) the date of issue of the bonds.
If bearer company bonds are issued, the company's record of bondholders shall record the total value of such bonds, the interest rate thereon, the term thereof and the method for repayment, and the date of issue and the serial numbers of the bond certificates.
Article 159
In the event of registered bonds, securities registration and settlement organizations shall establish relevant rules and regulations for the bonds registration, deposit, interest payment and bond redemption.
Article 160
Company bonds may be assigned, the price of which shall be agreed upon between the assignor and the assignee.
Where the company bonds are listed and traded at a securities exchange, the assignment of the bonds shall be conducted in accordance with the trading rules of the securities exchange.
Article 161
Assignment of registered company bonds is effected by the bondholder's endorsement of the bonds or by other methods prescribed by relevant laws and administrative regulations. After the assignment of the bonds, the company shall record the assignee's name and domicile on the record of bondholders.
Assignment of bearer bonds takes effect upon delivery thereof by the bondholder to the assignee at a lawfully established securities exchange.
Article 162
Upon adoption of a resolution by the general meeting of shareholders, a listed company may issue bonds which are convertible to its shares, and it shall prescribe the specific method for such conversion in the plan for company bonds offer. In order to issue convertible company bonds, an application shall be submitted to the securities regulatory authority under the State Council for approval. In the case of issue of convertible company bonds, the face of the bond certificate shall be marked with the word "Convertible," and the number of convertible company bonds shall be specified in the company's record of bondholders.
Article 163 Where convertible company bonds are issued, the company shall exchange its shares for the bonds held by the bondholders using the prescribed method of conversion, provided that the bondholders have the option on whether or not to convert their bonds.
