ZTE board approves new raw material purchase agreement with controlling shareholder

ZTE Corporation's board, at its Eighteenth Meeting of the Tenth Session on December 23, 2025, approved the Zhongxingxin Purchase Framework Agreement and associated annual caps for the year ending December 31, 2026. Zhongxingxin, holding approximately 20.09% interest in ZTE, is a connected person under Hong Kong Listing Rules, making these transactions continuing connected transactions. The proposed annual caps for 2026 are subject to reporting, annual review, and announcement requirements, but are exempt from independent Shareholders' approval as applicable percentage ratios exceed 0.1% but remain below 5%.

The Group estimates that the aggregate transaction amounts for raw material purchases from Zhongxingxin Group will not exceed RMB400 million (excluding VAT) for the year ending December 31, 2026. This projection aligns with historical transaction amounts, which were RMB268 million in 2023, RMB225 million in 2024, and RMB226 million for the first 11 months of 2025, against an annual cap of RMB400 million for 2025.

Raw materials purchased include various components such as wiring equipment, optical patch cords, and LiFePO4 batteries, with estimated prices ranging from RMB0.1 to RMB500,000 per unit/set/piece. The payment method for these purchases dictates that payables shall be settled within 210 days of goods acceptance, primarily through commercial acceptance bills.